How much do you win in mega millions

Topline

The Mega Millions lottery jackpot surpassed ten figures Tuesday after no ticket matched all six numbers drawn, pushing Friday’s potential winnings up to $1.025 billion—but because of taxes, the winner will take home significantly less cash.

Beckoning billions: Mega Millions lottery tickets sit inside a convenience store in lower Manhattan.

Key Facts

Mega Millions winners can either take 30 annual payments over 29 years or an immediate cash lump sum, which most winners opt for.

The estimated cash option will come out to $602.5 million, and the prize would be subject to an initial 24% federal tax withholding, or roughly $144.6 million.

The winner would also owe additional taxes at higher brackets, up to the 37% top federal marginal tax bracket for ordinary income: For a single taxpayer with no additional income, no dependents and no itemized deductions (like big charitable contributions), the total additional tax would be another $78.3 million due, leaving the winner with $379.6 million before state taxes.

The annuity option provides the full $1.03 billion in winnings over 30 annual payments of $34.1 million on average—but again, that’s before taxes.

While the 24% federal tax withholding still applies, it amounts to $8.2 million annually, and the additional federal tax (for a single taxpayer with no other income, at today’s rates, which are likely to change) would come to another $4.4 million, leaving the winner with $21.5 million per year, before state taxes.

State taxes vary, and while some states don’t tax lottery winnings (including those with no state income tax, like Texas and Florida, and those that specifically exempt lottery winnings, like high-tax California), state income taxes can be as high as 10.9% in New York.

In some states, cities are allowed to impose their own income taxes, and in New York City the top rate is an additional 3.87% on top of the state and federal taxes.

Key Background

If there is a winning ticket Friday, the jackpot would be the third largest in Mega Millions history, and the third time the prize has exceeded $1 billion. The largest in history was a jackpot of nearly $1.54 billion in 2018. The odds of winning the jackpot by matching all six numbers is approximately 1 in 302 million. This jackpot’s run began in April, and the next drawing will take place Friday at 11 p.m. EDT.

Further Reading

Mega Millions: Do This If You Win The $810 Million Lottery Jackpot (Forbes)

Getty Mega Millions

If you’re watching the Mega Millions drawing tonight, you may find that you matched only one number that was drawn. Does this mean you won something, even if you didn’t win the big jackpot? Unfortunately, if you only matched one white number on the Mega Millions drawing, you did NOT win any money. If the only number matched was the yellow Mega Ball number itself, then you’ll win $2.

Here’s How Much You Win for Matching One Number

There are multiple ways to win the Mega Millions drawing. But unfortunately, if you only matched one white number, then you haven’t won anything tonight.

If you matched one yellow ball (which is the last number drawn), then you’ll win $2. You can put that money into buying one more Mega Millions ticket! (And yes, if this seems different, then you’re right. Mega Millions used to cost just $1 a ticket, but now it costs $2 a ticket.)

Other Ways You Can Win Tonight

The $2 you’ll win for matching one yellow ball is the smallest prize amount. Here are other ways that you can win tonight. In order to win tonight’s jackpot, you’d need to match all five white balls and the yellow Mega ball. If you match all five white numbers only, you’ll win $1 million (and more if you’re using a Mega plier option.) If you match 4 white and the yellow, you’ll win $10,000. If you match 4 white only, you’ll win $500. If you match 3 white and 1 yellow, you’ll win $200. If you match 3 white only or if you match 2 white and 1 yellow, you’ll win $10. If you match one white and one yellow, you’ll win $4.

The odds of winning Mega Millions are 1 in 302.6 million, which are actually less than the odds of winning the Powerball, which is 1 in 292.2 million. Mega Millions recently changed its rules in October 2017, making the odds of winning the big jackpot lower (they used to be 1 in 258.9 million.) On October 28, 2017, Mega Millions increased the cost of buying a ticket from $1 to $2. They also changed the play structure. Instead of picking five numbers out of 75 and 1 number out of 15, players now pick five numbers out of 70 and and 1 out of 25.

When someone eventually does win the jackpot, it will take a while before we find out their identity (if ever.) Some states allow a few weeks to claim a prize and other states allow winners to take up to a year to claim them. And some states allow winners to stay anonymous. And as for the states that don’t — well, those rules might be changing soon, thanks to a recent Powerball jackpot winner in New Hampshire. Although New Hampshire rules allow people who win games like Powerball to take up to a one year from the draw date to claim their prize, New Hampshire law also requires the winner’s name, town, and amount won be available for public information. The winner was able to file a lawsuit and stay anonymous while claiming the winnings through an anonymous trust even though they had originally signed their winning ticket with their name.