Free tool, updated for 2026
Lottery tax calculator
What a jackpot is actually worth where you live, after federal and state tax, for a lump sum or an annuity. It shows the number most calculators leave out: what is still owed after the withholding everyone quotes.
What you actually keep
$204,813,000
from $325,100,000, taken as cash
- Federal withheld at payout (24%)
- - $78,024,000
- In the bank on payout day
- $247,076,000
- Federal actually owed (37%)
- - $120,287,000
- Left after filing
- $204,813,000
Still to pay at filing: $42,263,000. Withholding is not the tax. Set this aside, because the bill arrives the following April and nobody sends a reminder.
An estimate, not tax advice. It applies the top federal bracket, which a jackpot lands entirely inside, and ignores deductions, other income, filing status and any local tax beyond the notes above. Talk to a tax professional before you claim.
The 13% almost every calculator hides
When a prize over $5,000 is paid, the lottery withholds a flat 24% for federal tax under IRC 3402(q). That figure is where most after-tax calculators stop, and it is a deposit rather than a settlement.
A jackpot lands entirely inside the top federal bracket, 37%. The missing 13 percentage points do not go away. They arrive as a bill the following April, and on a nine-figure prize that bill runs to tens of millions.
17 states repeat the same trick at state level, withholding less than they charge. Massachusetts withholds 5% against 9% owed. Delaware withholds nothing at all and still taxes at 6.6%. The calculator above splits payout day from filing day for exactly this reason.
States that take nothing
9 states levy no income tax, so a jackpot won there faces federal tax only:
- Alaska
- Florida
- Nevada
- New Hampshire
- South Dakota
- Tennessee
- Texas
- Washington
- Wyoming
California is the interesting one. It has the highest top income tax rate in the country at 13.3%, and it exempts California Lottery prizes entirely by statute. Win a Powerball ticket bought in California and the state takes nothing. Win another state’s lottery as a Californian and it taxes you at up to 13.3%.
One correction worth making
Delaware appears on almost every “states with no lottery tax” list online. It does not belong there. The Delaware Lottery’s own FAQ states that all winning Delaware Lottery tickets are subject to Delaware income tax. What confuses people is that Delaware withholds nothing at payout, so the money looks untaxed until the return is filed.
Lump sum or annuity
The advertised jackpot is not a pot of money. It is the sum of 30 payments made over 29 years, each 5% larger than the last. The cash value is what the operator holds today, currently around 43% of the advertised figure rather than the 50% people assume.
Taking the annuity spreads the income across 30 tax years instead of concentrating it in one, though a jackpot is large enough that every year still lands in the top bracket. The calculator will do both, so you can see the two side by side rather than argue about it.
Frequently asked questions
How much tax do you pay on lottery winnings?
A US lottery jackpot is taxed at the top federal rate of 37%, plus state tax of up to 13.3%. Only 24% is withheld when the prize is paid, so a large balance is still due at filing. On a $300 million lump sum the gap between what is withheld and what is owed is around $39 million.
Which states do not tax lottery winnings?
Nine states have no income tax at all, so they take nothing: Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington and Wyoming. California is a tenth case: it exempts California Lottery prizes by statute under Government Code 8880.68, but it does tax winnings from another state’s lottery at up to 13.3%.
Does Delaware tax lottery winnings?
Yes. Delaware is widely and wrongly listed as tax-free. The Delaware Lottery states that all winning Delaware Lottery tickets are subject to Delaware income tax, which reaches 6.6%. What makes it unusual is that no state tax is withheld at payout, so the entire state bill arrives at filing rather than being deducted first.
Why is only 24% withheld if the tax is 37%?
24% is a flat federal withholding rate on gambling proceeds over $5,000, set by IRC 3402(q). It is a deposit against the bill, not the bill. A jackpot lands entirely inside the top 37% bracket, so the remaining 13 percentage points are settled on your return the following April.
Is the lump sum or the annuity better after tax?
The annuity pays more in total, because the advertised jackpot is the sum of 30 payments rising 5% a year while the cash value is roughly 43% of it. The lump sum gives you the money now and control of how it is invested. Tax rates apply to both, and the annuity spreads the income across 30 tax years rather than concentrating it in one.
Do you pay state tax where you bought the ticket or where you live?
Usually both matter. The state where the ticket was sold generally withholds first, and your home state then taxes the winnings and gives credit for tax paid elsewhere. A few states are stricter: Connecticut withholds 6.99% whether or not you live there. This calculator uses the state where you bought the ticket.
How much do you get if you win $1 million?
On a $1 million prize taken as cash, 24% is withheld immediately, leaving $760,000. The actual federal liability at the top rate is $370,000, so about $130,000 more is due at filing, before state tax. In a no-income-tax state you keep roughly $630,000; in New York you keep roughly $521,000.
Holding a ticket rather than daydreaming? Check your numbers against the latest draw, or read how to pick lottery numbers.
Rates are for tax year 2026 and were confirmed against state revenue departments and state lotteries. Current Powerball figures shown by default: $748 million advertised, $325.1 million cash. This is an estimate and not tax advice.