By Nicholas Christensen
Last Updated: September 25, 2023
The lottery can deal with some very large numbers, leading to some complex calculations regarding odds or payouts. Also, the different taxes can be problematic when calculating a precise payout. Here at Lottery Critic, we've created our very own calculators to solve all of those issues.
Lottery Odds Calculator
Not quite sure how to calculate lottery combinations to find your chances of winning? Use our lottery odds calculator for an easy solution! It displays all the formulas involved, so you can easily follow along.
Using our calculator, you can add your lucky numbers: birthdays or anniversaries, and see their odds of coming up together.
You can also input how many tickets you’re thinking of purchasing to see how much it’ll increase your chances.
Powerball Payout and Tax Calculator
Around since 1992, Powerball has become known for producing some of the largest jackpots in history – which recently surpassed a record-breaking $2.1 billion. It rolls biweekly with the promise of changing the winner’s life forever.
Did you know that you have to pay income tax on your Powerball lottery winnings, though?
Find out how much federal and state taxes you need to pay if you win the Powerball jackpot – for both the annuity and cash options. Our lottery tax calculator also displays a payout schedule to show you how much of your winnings you'll receive each year.
Mega Millions Payout and Tax Calculator
Mega Millions jackpots are slightly lower than Powerball’s, and the odds are likewise lower. Nevertheless, with the option to play just for the jackpot, it’s among the most popular lotteries in the US.
Similarly to Powerball, you can also compute your tax liabilities on lottery winnings if you win the Mega Millions jackpot.
Our calculator lets you compare taxes for both annuity and cash lump sum payout options, and of course, displays a handy payment table for easy reference.
Powerball
$34,000,000
Next Draw Closes In:
01075211
Play Using Best Tools
Mega Millions
$47,000,000
Next Draw Closes In:
00075211
Play Using Best Tools
How Our Lottery Calculator Can Help You Play Smarter
These lottery tools are here to help you make better decisions.
For one thing, you can use our odds calculator tofind the lotteries with the best chances of winning. Compare the odds between your favorite lottery games, and focus on the ones that show the most potential.
Maximize Your Lottery Winnings
As we said above, lottery winnings count as ordinary taxable income. Taken either as annuity payments or one big lump sum payment, lottery winnings are taxed both at federal and state levels.
How much you pay taxes depends on your withdrawal options: lump sum lottery winnings usually attract more tax while annuity payouts result in smaller losses but take decades to be completely deployed.
Federal taxes can eat out as much as 24 percent of your prize if you opt for a lottery lump sum payout. It can easily push you to a higher federal tax bracket, which adds more to your losses.
On the flip side, you can access your prize money much faster (time is money, after all) and start investing it right away!
Alternatively, you can spread out your winnings over three decades – which would come with federal and state tax liabilities, but on the whole, attract a much smaller federal tax rate.
In the event that you do win, our calculators and payout tables can help you understand how much tax you will pay and plan ahead.
Taxes on Lottery Winnings
The IRS treats lottery winnings as taxable income, which means that you’ll be paying both federal and state tax.
Taxes on a Federal Level
How much you’ll be paying in federal taxes depends on whether you’re a single or joint filer, and your tax bracket – note that it you’ve won the lottery, chances are that it’ll be pushed to a higher bracket. You can access federal tax rates and calculators via the IRS website.
Let's consider a scenario where you are an individual taxpayer with an annual income of $45,000. Now, imagine you win a substantial $100,000 in the lottery. This newfound windfall increases your taxable income to $145,000, causing your marginal tax rate to rise from 22% to 24%. (For simplicity, we are assuming there are no deductions in this example.)
However, it's important to note that you won't be taxed at the 24% rate on the entire $145,000. If, for instance, the tax bracket for income above $95,376 begins at that threshold, you will only be subject to the 24% tax rate on the portion of your income that exceeds $95,376. In this case, that excess amount is $49,624.
To break it down, you would owe $16,290 in taxes on the first $95,376 of your income and 24% of the remaining $49,624. Consequently, out of your $100,000 lottery winnings, your total federal tax liability would be $28,199.76.
Taxes on a State Level
If you’re unlucky, some states will also take a piece of your winnings as well as the federal tax. How much you’ll be paying depends on where you live, with rates varying from 0% to 8%. State of New York levy the highest rate, whereas the following 9 out of 51 states don’t levy any income tax at all:
- Alaska
- Florida
- Nevada
- New Hampshire
- South Dakota
- Tennessee
- Texas
- Washington
- Wyoming
If you live in one state and get your ticket in another, you will pay taxes in accordance with the rules of the state you bought the ticket in.
You can easily calculate the federal and state tax liabilities, both for annuity and lump sum payments, using our calculators above!
