Tonight's Powerball Jackpot Tops $1 Billion, Fourth-Biggest in History

By
Mack Wilowski
Mack Wilowski
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Mack Wilowski is a staff writer for Investopedia, focusing on breaking news stories, earnings previews, and company-specific insights and analysis. Previously, he was an associate editor for Investopedia's earned media team, where he covered the New York City Recovery Index and Economy Tracker, the weekly "What to Expect" markets preview, The Investopedia Express and Green Investor podcast transcripts, and the Term of the Day newsletter.
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Published October 02, 2023
Powerball tickets

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Key Takeaways

  • With no winner announced on Saturday, Monday night's Powerball jackpot stands at a lofty $1.04 billion.
  • Correctly match five white numbers and one red—with odds of roughly 1 in 292 million—and you could win the fourth-biggest prize in Powerball history.
  • The tax bill for the lucky winner who takes either a lump sum or annual payments from the $1 billion pot could cut the prize significantly.
  • If the winner chooses a lump sum, the most they would likely pocket is slightly more than $300 million, once federal withholding and income taxes are applied.
  • If you live in a state with a lottery tax, those pocketed earnings could drop even more; a winner from New York could take home no more than $250 million.

With no winner announced on Saturday, Monday night's Powerball jackpot amounts to a whopping $1.04 billion.

Correctly match five white numbers and one red one at the 10:59 p.m. Eastern time drawing—a feat with odds of roughly 1 in 292 million—and you could win the fourth-biggest prize in Powerball history.

But winning doesn't mean the lucky ticket holder gets to pocket $1 billion.

Winners of the Powerball jackpot have two options to claim the money: lump sum or annuity. Choosing a lump sum means you'll receive about $478.2 million right away—less than half the $1.04 billion sum.

Next, a 24% federal withholding tax is applied to that sum, dropping the winnings to just more than $360 million. What's more—because the federal government counts lottery earnings as income—you could be moved into a higher tax bracket, potentially as high as 37%, which could slice your earnings to as little as $301.3 million.

Go with the annuity option, and you'll receive the full $1.04 billion over 30 years of installments. That, however, could also be cut, once federal taxes are applied. If you're in the top income-tax bracket of 37%, your annual installments could decline to $21.8 million, from $34.7 million. That will total just over $650 million over three decades.

The amount you pocket from a Powerball win also could depend on where you live. Certain states, like Florida and Texas, don't tax lottery winnings. Others, like Maryland and New York, tax upwards of 8% on your winnings. A lump-sum winning ticket in New York, with an 8.82% lottery tax rate, would yield less than $250 million after federal withholding tax, income tax, and state lottery tax is accounted for.

Of course, the numbers above assume a single winner. If there are multiple winners, the earnings will be evenly divided by how many winners there are.

Correction—Oct. 2, 2023: A previous version of this article incorrectly stated the amount a Powerball jackpot winner could take home after federal and state taxes.

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  1. Powerball. "Powerball: Home."

  2. Powerball. "9 Ways To Win!"

  3. Powerball. "Powerball Drawing Detail for Monday, October 2, 2023."

  4. USA Mega Millions. "Powerball Jackpot Analysis."

  5. WiseVoter. "Tax on Lottery Winnings by State."

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