By Alicia Adamczyk
January 14, 2016

Well, it was fun while it lasted. At least three winners have claim to the $1.6 billion Powerball jackpot, the largest lottery prize in history. The winning tickets were sold in Florida, California, and Tennessee — and in all three cases, there’s extra reason to be jealous of the winners because of the local tax implications.

Unlike most states, California, Florida, and Tennessee do not tax lottery winnings. Considering USA Mega, a site that tracks lottery numbers, estimated the state with the lowest tax (New Jersey) would take an extra $28 million cut when the jackpot was $1.5 billion, that’s a pretty sweet savings.

So yes, the winners will still have the federal income tax (39.6%) to grapple with, and they’ll have to split the pot three ways (each will take home about $187.2 million if they all take the lump sum, which they should, according to CNN). But considering the chances of winning the pot were 1 in 292 million, there’s hardly room to complain.

Other states and territories that do not tax lottery winnings or have a state income tax: New Hampshire, Pennsylvania, Puerto Rico (no state or federal), South Dakota, Texas, the U.S. Virgin Islands, Washington and Wyoming.

Another person feeling pretty good this morning? According to CNN, Balbir Atwal, the owner of the 7-Eleven franchise in California that sold one winning tickets, will receive a $1 million bonus. Talk about lucky.

SPONSORED FINANCIAL CONTENT

You May Like

EDIT POST