Mega Millions Jackpot: How Much Will the IRS Get From $1.35 Billion Cash Prize?

The Tuesday draw for Mega Millions did not result in any winner again, which means the jackpot shot up again as it will now be worth $1.35 billion. However, with such a large prize, this begs the question, how much will the winner have to pay the IRS?

According to The Hill, the winning numbers are 7, 13, 14, 15, 18, and gold ball 9. The estimated cash option before the draw was approximately $568.7 million. It was considered one of the largest prizes in Mega Millions lottery history.

However, with the prize now shooting up to $1.35 billion, several Twitter users managed to calculate how much taxes will the winner be paying to the IRS. The $1.35 billion prize is now considered the second largest in history. However, Twitter sleuths have estimated that the eventual winner will be taking less than a billion dollars.

Mega Millions Jackpot and Taxes the Winner Will Be Paying to the IRS

The New York Post pointed out that the real winner of this lottery may be the IRS, as no matter who wins, they are still going to get a huge tax payment.

Grit Capital CEO Genevieve Roch-Decter, one of those who estimated how much the winner will take, said on social media that "They'll collect at least $200 million immediately if the winner selects the $568m immediate cash payout."

Another financial Twitter page, Market Rebellion, tweeted "CONGRATS to the IRS for winning the $846.3MM Mega Millions lottery!" The page also added, "Winner Of $1.28 Billion Lottery Gets $433.7 Million After Tax."

Business author Jared Dillian also tried his hand at calculating how much the winner might get after taxes. He said that assuming that the prize was $1.1 billion and the cash value is $568.7 million, with a tax rate of 45%, this may leave winners with just $313 million.

What Are the Best States to Win the Mega Millions Jackpot?

Many pointed out that those are just federal taxes. The state taxes that winners might also pay are a much different thing entirely. After the winner gets the jackpot and pays the federal taxes, he or she would still also have to pay an additional state tax, which ranges from 3% to a whopping 10.9% in New York.

However, CNBC pointed out that eight states do not charge additional taxes for lottery winners at all. This means that winners from these eight states will be able to receive the maximum payout.

These eight states are California, Florida, New Hampshire, South Dakota, Tennessee, Texas, Washington state, and Wyoming.

For the $1.35 billion Mega Millions jackpot, those who live here might get $446,014,045 for the lump sum amount and a total of $851,611,350 for the 30-year annuity payments. The majority of winners often go for the lump sum as the money can be reinvested right away.

This article is owned by Latin Post.

Written by: Rick Martin

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