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  1. Taxes
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How Much You'll Pay in Taxes When You Win the $700 Million Powerball Jackpot, in Every State

By:
Alicia Adamczyk
Last Updated: Aug 22, 2017 | 10 min read
7-Eleven franchise owner Balbir Atwal, right, who will receive $1 million for selling a winning ticket, holds a Powerball poster as media crowds around at Chino Hills store, January 14, 2016. - Allen J. Schaben—LA Times via Getty Images
7-Eleven franchise owner Balbir Atwal, right, who will receive $1 million for selling a winning ticket, holds a Powerball poster as media crowds around at Chino Hills store, January 14, 2016. Allen J. Schaben—LA Times via Getty Images

This post was updated to reflect the Powerball jackpot increasing from $650 million to $700 million.

The Powerball drawing Wednesday is worth $700 million, the second-largest windfall in the program's history. Depending on the state where the winning ticket is sold, the chosen one(s) will receive far less than the total advertised.

To start, a single winner will receive the $700 million check only if they choose an annuity, which is paid out over 29 years. Selecting the lump sum option, which most winners do, will gross $443 million. The federal government will then take a 25% cut of the winnings (foreigners are taxed 30%), leaving the winner with a $308.8 million jackpot, or $17.5 million per year, if they pick the annuity, according to USA Mega, a site that tracks the numbers. (Whether to take the lump sum or the annuity is a heated debate, but far more winners have selected the one-time payment.)

Then there's state taxes to take into consideration. Some states, like Texas and California, do not tax lottery winnings, while others tax as much as 8.82% (hi New York). Here's how much of a cut each state would take, per USA Mega. Two things to note: first, Alabama, Alaska, Hawaii, Mississippi, Nevada, and Utah are not listed because they do not sell Powerball tickets, and second, the annuity payments actually increase over time due to inflation. What's listed is an average of the 30 payments (USAMega breaks down each state's annuity payment schedule.) Additionally, if you take the lump sum, you'll be paying taxes each year on any investment income.

Arizona: 5% state tax for residents

Arkansas: 7% state tax

California: No state tax on lottery winnings

Colorado: 4% state tax

Connecticut: 6.99% state tax

Delaware: No state tax on lottery winnings

District of Columbia: 8.5% state tax

Florida: No state tax on lottery winnings.

Georgia: 6% state tax

Idaho: 7.4% state tax

Illinois: 4.95% state tax

Indiana: 3.4% state tax

Iowa: 5% state tax

Kansas: 5% state tax

Kentucky: 6% state tax

Louisiana: 5% state tax

Maine: 5% state tax

Maryland: 8.75% state tax for residents

Massachusetts: 5% state tax

Michigan: 4.25% state tax

Minnesota: 7.25% state tax

Missouri: 4% state tax

Montana: 6.9% state tax

Nebraska: 5% state tax

New Hampshire: No tax on lottery winnings.

New Jersey: 8% state tax

New Mexico: 6% state tax

New York: 8.82% state tax

North Carolina: 5.499% state tax

North Dakota: 2.9% state tax

Ohio: 4% state tax

Oklahoma: 4% state tax

Oregon: 8% state tax

Pennsylvania: 3.07% state tax

Puerto Rico: No state or federal taxes on income.

Rhode Island: 5.99% state tax

South Carolina: 7%

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South Dakota: No state income tax.

Tennessee: Only income tax on income from stocks and bonds.

Texas: No state income tax.

US Virgin Islands: No state tax on lottery winnings.

Vermont: 6% state tax

Virginia: 4%

Washington: No state tax on lottery winnings.

West Virginia: 6.5% state tax

Wisconsin: 7.65% state tax

Wyoming: No state tax on lottery winnings.

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