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Mega Thousands and thousands jackpot now $1.35 billion. Here’s tax bill when you win

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Chances are you’ll face long odds of hitting the Mega Thousands and thousands jackpot — now value $1.35 billion — however the taxman is at all times guaranteed a slice when there is a winner.

The jackpot jumped again after no ticket matched all six numbers drawn Tuesday night to land the grand prize. If won in the subsequent drawing — set for Friday night — it could mark the second-largest Mega Thousands and thousands jackpot ever and the fourth-largest lottery prize in history.

With the chances stacked against a single ticket winning the motherlode — 1 in 302.6 million — the quantity has been growing since Oct. 14 when the jackpot was reset to $20 million after two tickets sold in Florida and California split a $502 million grand prize.

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In fact, the advertised amount is at all times what you’d get (pretax) when you were to assert your windfall as an annuity spread over three a long time and taxed every year as you receive the income.

Most winners, nevertheless, select the lump sum money option, which for this jackpot is $707.9 million.

That quantity could be reduced by a compulsory 24% federal withholding, or $169.9 million, which might lower your winnings to $538 million. Yet since the top marginal income tax rate of 37% applies to income above $578,125 for individual tax filers and $693,750 for married couples, you could possibly count on owing more to the IRS at tax time.

Many jackpot winners tap their philanthropic side and provides a few of their windfall to charitable causes. Those donations are tax deductible, which would cut back your tax bill.

Nevertheless, when you were to face the highest rate of 37% on the total $707.9 million money option, $261.9 million in all would go to the IRS, reducing your haul to $446 million.

State taxes — and sometimes local taxes — would also likely be withheld or due, depending on where you bought the ticket and where you reside. Those levies can range from zero to greater than 10%.

Nevertheless, even when fully half of your winnings went to taxes, you’d still find yourself with roughly $354 million, which is way over most individuals see in a lifetime.

Meanwhile, Powerball’s jackpot is $360 million ($188.7 million money) for Wednesday night’s drawing. The prospect of hitting the jackpot in that game is barely higher than with Mega Thousands and thousands: 1 in 292 million.

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