The Powerball jackpot reached $1 billion, only the fifth time in its history. The recent dry spell saw 38 consecutive drawings without a winner, with the last big prize being won on January 1st for $842.4 million in Michigan. If a winner emerges from Monday night’s drawing, they will have the option of a single lump-sum payment of $438.8 million or an annuity with an immediate payment followed by annual payments for 29 years, increasing by 5% each year.
However, both of these payouts are subject to hefty taxes. Winners in New York have it especially tough, with federal withholding of 24% in addition to state taxes of 10.90%. New York City also withholds 3.876% on top of the state and federal tax. In Yonkers, winners are subject to an additional 1.82575% in Yonkers withholding tax. According to NerdWallet’s lottery tax calculator, a New Yorker who wins Monday night’s jackpot and opts for the lump-sum payment could end up with just under $295 million after taxes, having paid over $105 million in federal tax and $38.7 million to the Empire State.
Johnnie Taylor, a 71-year-old handyman from Howard Beach, became New York State’s biggest lottery winner last April when he won a $476 million Mega Millions jackpot. Powerball tickets are sold in 45 states, Washington, D.C., Puerto Rico, and the US Virgin Islands. The overall odds of winning any Powerball prize are 1 in 24.9, while the odds of winning the jackpot are 1 in 292.2 million. The drawing for Monday’s jackpot is scheduled for 10:59 p.m. EST.
Monday night’s Powerball drawing is a highly anticipated event as the jackpot reached a historic $1 billion. With no winner for 38 consecutive drawings, the excitement is palpable as participants hope to be the lucky winner. The tax implications for winners, especially in New York, are significant, with federal withholding, state taxes, and city taxes all taking a serious cut of the jackpot. Despite the high taxes, lottery winners like Johnnie Taylor have walked away with life-changing amounts of money, making the Powerball drawing a night of suspense and possibility for all involved.
