The Mega Millions jackpot surged to $792 million, marking it as the second-largest jackpot prize of the year thus far, as no tickets matched all six numbers drawn on Tuesday night. However, the eventual winner will receive a substantially reduced payout after accounting for taxes.
Here are the key points:
- If a winner emerges in the upcoming draw, they have the option to receive the $792 million jackpot spread over 30 annual payments or opt for a lump sum cash prize of $381.8 million, which is typically the preferred choice.
- The lump sum payment would decrease to $290.2 million after a mandatory federal tax withholding of 24%.
- Further reducing the winnings, the winner might face a federal marginal rate of up to 37%, depending on their taxable income, resulting in a final payout of $240.5 million.
- Opting for the installment route would lead to annual payments of $26.4 million, which would decrease to $16.63 million if the 37% federal marginal rate is applied.
- Additionally, the winner may be subject to additional taxes from their state of residence, with some states like New York imposing a 10.9% tax on lottery winnings, while others like Texas, Florida, and California do not.
The odds of winning the Mega Millions jackpot stand at an astounding 1-in-302.6 million, even worse than the already slim odds of 1-in-292.2 million for the Powerball jackpot.
In terms of background:
- The Powerball prize increased once more on Monday night as no tickets matched all six numbers drawn. The largest jackpot of the year thus far was the $842.4 million Powerball prize won by a single ticket holder from Michigan on New Year’s Day.
The next drawing for the Mega Millions jackpot is scheduled for Friday night, while Powerball will hold a drawing for a $559 million jackpot on Wednesday night.
