The Mega Millions jackpot has reached an impressive $965 million, marking it as the second largest lottery prize of the year. This increase follows a recent drawing where no tickets matched all six winning numbers, which were 10, 13, 40, 42, 46, and Mega Ball 1.
Jackpot Options and Payouts
Should a winner be announced in the upcoming drawing, they will face a significant choice regarding how to receive their prize. There are two main payout options for the $965 million jackpot:
- Annual Installments: The total amount is distributed over 30 years.
- Lump Sum Cash Payment: A one-time payout of approximately $445.3 million.
Most winners typically opt for the lump sum. However, it is crucial to understand the impact of taxes on these winnings. After an initial federal tax withholding of 24%, the payout decreases to about $338.4 million. Given federal tax rates that may soar up to 37% based on the winner’s income, the ultimate amount could drop to approximately $280.5 million.
Impact of Federal and State Taxes
If the winner chooses the installment option, they will receive about $32.16 million per year. However, after applying the higher federal tax rate, this annual payment may be reduced to approximately $20.26 million. Additional state taxes can also apply, depending on the winner’s location.
- New York: 10.9% tax on lottery winnings
- Texas, Florida, California: No state tax on lottery winnings
Upcoming Drawings
The next Mega Millions drawing is set for Friday night. In addition, the Powerball jackpot has also increased, reaching $512 million, with its drawing scheduled for Wednesday night. Players across the country eagerly anticipate these events, hoping they will strike it rich.
