News

Share to FacebookShare to TwitterShare to LinkedinTopline No one bagged Tuesday night’s billion-dollar Mega Millions draw, the lottery operator said, sending the jackpot soaring to $1.35 billion for the next draw on Friday the 13th, one of the largest prizes in U.S. lottery history that many will hope to claim despite the unlucky date, though any winner will face a hefty tax bill and take home much less than the headline prize—here’s how much.

Friday’s Mega Millions draw has grown to $1.35 billion.

Getty Images Key Facts The Mega Millions jackpot winner will have to choose between receiving the full prize as an annuity—a series of 30 payments paid over 29 years—or as a smaller, one-off payment equal to the cash in the prize pool.

Though the lump-sum payment is less than the advertised jackpot (which emphasizes the value of the annuity prize), it is by far the most popular option among lottery winners and Friday’s cash prize is worth an estimated $708 million.

Just under a quarter of the prize—24%—will be automatically withheld for federal taxes by the IRS, immediately cutting the payout by around $170 million to roughly $538 million, though the taxman is not done yet.

The top federal tax rate is 37% and unless the winner has managed to significantly reduce their taxable income—for example through large charitable donations—they will need to set aside $92 million to cover the remaining federal tax bill, leaving them with around $446 million.

Depending on where the winner lives and where they bought the winning ticket, state and city taxes could also come into play and eat into the jackpot even more, though the exact amount is hard to predict as each state has their own tax laws governing income and lottery winnings.

Mega Millions annuity payments increase by 5% each year to guard against inflation, the lottery operator says, and the amount of tax paid each year would likewise vary, with the first payout likely to be around $20 million, which will be reduced to nearly $13 million after federal taxes and could be cut further by state and city taxes.

Key Background Friday’s $1.35 billion jackpot is the second highest in Mega Millions’ history, the operator said in a statement. It has surpassed a $1.34 billion jackpot claimed by a single ticket holder in July and is approaching the operator’s record of $1.54 billion, which was claimed in 2018. Massive jackpots have become a feature of lotteries in recent years, where rules are designed to make it easier to win but harder to win big. The lottery operator said there were more than 6.1 million winning tickets from Monday’s Mega Millions draw—white balls drawn were 7, 13, 14, 15 and 18 and the gold Mega Ball drawn was 9—with prizes ranging from $2 to $3 million. Sixteen of these tickets matched the five white balls to win $1 million, with three having tripled the amount with an extra purchase.

What To Watch For The next Mega Millions draw will take place at 11 p.m. ET on Friday, January 13.

Surprising Fact Many people associate Friday the 13th with bad luck and superstition. However, Mega Millions says the day has been rewarding for players over the years and six jackpots have been won on such days. Michiganders have been particularly lucky, the operator said, claiming four of these winning tickets, though none came close to Friday’s $1.35 billion jackpot.

Big Number $2.04 billion. That’s the value of the largest lottery jackpot won in the U.S., a Powerball draw claimed by a single winner in California in November. Before that, the largest lottery jackpot in the U.S. was a Powerball draw worth $1.59 billion, which was shared by three winners in 2016. The 2018 Mega Millions Jackpot, worth $1.54 billion, is the third highest jackpot in U.S. lottery.

Tangent The odds of winning the Mega Millions jackpot are slight, around 1 in 302 million, according to the operator. Such odds are not in players’ favor. Players have much greater odds of being struck by lightning in any given year, which are less than 1 in 1 million, according to the CDC.

Further Reading California Ticket Wins Record $2.04 Billion Powerball Jackpot—Here’s How Much They’ll Pay In Taxes (Forbes)

Mega Millions: Two Finally Claim Historic $1.337 Billion Jackpot In Illinois (Forbes)

Yes, The Powerball Jackpot Is Over A Billion Dollars, But Here’s Why You Shouldn’t Buy A Ticket (Buzzfeed News)

Follow me on Twitter or LinkedIn. Send me a secure tip.