Are lottery prizes taxable?
Lottery winnings of $600.01 and over are subject to Federal Withholding tax. For
winnings of $600.01, up to and including $5,000, you will be issued a W-2G form
to report your winnings on your federal income tax form. For winnings of
$5,000.01 and over, your state’s Department of Revenue removes the 24 percent federal
withholding before you receive your winnings check (or, if it is
an annuity, from each winnings check). You then receive a W-2G form with each
check to submit with your 1040 form to show that the 24 percent federal
withholding already has been paid. In addition to federal tax, your state will
make additional withholdings for taxes, and most states will deduct other money that
you may owe to the state, such as back taxes, child support, loan payments, etc.
In addition, like the federal tax withholding, the state tax withholding at the time
of prize payout may not be the total state tax owed at the end of the year.
You must consult your state division of taxation for more information about the total
state tax requirements for lottery winners.
The state tax withholdings are as follows:
|Arizona||4.8% state withholding (Arizona residents), 6% state withholding (non-Arizona residents)|
|Arkansas||6.6% state withholding|
|California||No state tax on lottery prizes|
|Colorado||4.63% state withholding|
|Connecticut||6.99% state withholding|
|Delaware||6.6% state withholding|
|Florida||No state tax on lottery prizes|
|Georgia||5.75% state withholding|
|Idaho||6.925% state withholding|
|Illinois||4.95% state withholding|
|Indiana||3.23% state withholding|
|Iowa||5% state withholding|
|Kansas||5.7% state withholding|
|Kentucky||5% state withholding|
|Louisiana||6% state withholding|
|Maine||7.15% state withholding|
|Maryland||8.95% state withholding (Maryland residents), 8% state withholding (non-Maryland residents)|
|Massachusetts||5% state withholding|
|Michigan||4.25% state withholding|
|Minnesota||7.25% state withholding|
|Mississippi||5% state withholding|
|Missouri||4% state withholding|
|Montana||6.9% state withholding|
|Nebraska||5% state withholding|
|New Hampshire||No state tax on lottery prizes|
|New Jersey||8% state withholding|
|New Mexico||4.9% state withholding|
|New York||8.82% state withholding, plus: 3.876% (NYC residents), 1.323% (Yonkers residents)|
|North Carolina||5.25% state withholding|
|North Dakota||2.9% state withholding|
|Ohio||4.797% state withholding|
|Oklahoma||5% state withholding|
|Oregon||8% state withholding|
|Pennsylvania||3.07% state withholding|
|Puerto Rico||No state tax on lottery prizes|
|Rhode Island||5.99% state withholding|
|South Carolina||7% state withholding|
|South Dakota||No state tax on lottery prizes|
|Tennessee||No state tax on lottery prizes|
|Texas||No state tax on lottery prizes|
|U.S. Virgin Islands||† Unknown State Tax Rate|
|Vermont||6% state withholding|
|Virginia||4% state withholding|
|Washington||No state tax on lottery prizes|
|Washington, D.C.||8.95% state withholding|
|West Virginia||6.5% state withholding|
|Wisconsin||7.65% state withholding|
|Wyoming||No state tax on lottery prizes|
† This state/jurisdiction has not responded to our requests for this information.
Why is the cash option different than the advertised jackpot?
The Powerball jackpot is an estimated 29-year annuity value, with a total 30 payments (the first payment happens right away, followed by 29 annual payments). When players choose
the annuity option for their prize, the state lottery pays the prize out over 29 years (30 payments) by
buying U.S. Government Treasury Securities, which earn interest and mature annually over
the 29 years. That annual return is the amount the winners receive each year for the
29 year period. With the cash option, the state lottery will take the amount of
money that would have been invested and will pay it directly to the winner in one
payment. Both payment options have federal and applicable state taxes deducted
from them, although with an annuity option you pay taxes gradually on each annual payout, not all at once like with the cash option.
How to Play
USA Powerball draws take place twice a week in Florida. They are held at 22:59 Eastern Time on Wednesdays and Saturdays — see the on this page for the draw schedule according to South Africa local time. To take part, you must select five main numbers between 1 and 69 and one Powerball number from 1 to 26. It costs $2 per board to play.
Playing from South Africa
Tickets are only available to buy from retailers in 45 states in the USA, plus the jurisdictions of Washington D.C., the U.S. Virgin Islands and Puerto Rico. However, you can also play online from South Africa and other countries by following the steps below:
- Go to the Buy Tickets page and select USA Powerball
- Choose your numbers or select a Quick Pick on as many boards as you want to play
- Select whether to enter a single draw or multiple draws
- Select ‘Add To Cart’ and pay for your purchase.
If it is your first time, you will be guided through how to set up an online account. Your numbers will be safely stored online and you will be notified automatically if you are a winner, with prizes paid straight into your account.
When you buy a Powerball ticket, you can also add Power Play for an extra $1 per line. If you win any prize except the jackpot, it will be multiplied by 2x, 3x, 4x, 5x or 10x its original amount if you have selected the Power Play option. The multiplier is determined by a number that is randomly selected in the Power Play draw that takes place alongside the main game.
The 10x Power Play is not available once the jackpot exceeds $150 million. The second prize of $1 million is always doubled to $2 million regardless of which Power Play multiplier is in play.
The table below shows the odds of each Power Play multiplier being selected. The odds differ slightly depending on whether the 10x multiplier is available.
|Multiplier||Odds with 10x||Odds without 10x|
|10x||1 in 43||N/A|
|5x||1 in 21.5||1 in 21|
|4x||1 in 14.33||1 in 14|
|3x||1 in 3.31||1 in 3.23|
|2x||1 in 1.79||1 in 1.75|
Power Play may not always be available to players entering online from outside the USA.
What is the Power Play?
Power Play is an option that is currently offered in all states that sell Powerball tickets except California. For an extra $1.00 per ticket you can increase your non-jackpot prize winnings by 2, 3, 4, 5, or 10 times. (The 10 times Power Play is only available when the jackpot is $150 million or less.) The Power Play number is randomly drawn from a pool of multipliers that includes two 5Xs, three 4Xs, 13 3Xs, and 24 2Xs, plus one 10X when the jackpot is $150 million or less.
Power Play is not available in California because of state law that requires all lottery prizes to be paid out on a pari-mutuel basis.
The Power Play multiplier number is chosen at random just before the Powerball winning numbers are drawn.
A player must choose the Power Play option when they buy their Powerball ticket, and then the ticket must match one of the 9 Ways to Win (except the jackpot) before the multiplier takes effect. Power Play costs an extra $1 per play. See How to Play Powerball for more information.
Why is the cash option always a different percentage of the annuity from draw to draw?
If you’re calculating what percentage the cash value is of the annuity, then you’re looking at it backwards. The cash value is the starting point, as it is a direct percentage of ticket sales. Then the annuity amount is calculated from that, based on prevailing interest rates. Since the interest rates are constantly changing, the annuity amount calculated on one day will be a different number than if it is calculated the next day. So when a drawing occurs and the lottery has to estimate the next annuity jackpot, they first estimate the number of tickets that will be sold for the next drawing, which determines what the cash value estimate is (because a fixed percentage of each ticket sold goes toward prizes). Then they finally calculate what the annuity will be based on the current interest rates.
Why You Should Play usa powerball At Multilotto
Many jackpots and smaller wins have gone unclaimed and been used as a charity fund, simply because players probably misplaced or did not get to watch the draw. At Multilotto, the winning Powerball numbers are always sent to all those who played and informs any of their users who have won. Apart from just Powerball, players can indulge in many other lotteries such as Euromillions, Mega Millions, El Gordo, Mega-Sena amongst others that you can all play at once to increase your chances of winning. Casino game enthusiasts can also take a shot at the slots, table games and even video poker that are available at the site. The games are all from giant providers such as NetEnt Playn’ Go. You can enjoy all these while playing the Powerball lottery.