Lottery Tax Calculator
See exactly how much of a lottery jackpot you actually keep after federal and state taxes — lump sum or annuity.
State Lottery Tax Rates (2025)
| State | State Tax Rate | Notes |
|---|---|---|
| New York | 10.9% | + 3.87% NYC local |
| New Jersey | 10.75% | |
| Oregon | 9.9% | |
| Minnesota | 9.85% | |
| Maryland | 8.75% | |
| California | 0% | No lottery tax |
| Florida | 0% | No income tax |
| Texas | 0% | No income tax |
Frequently Asked Questions
How much tax do you pay on lottery winnings?
Lottery winnings are taxed as ordinary income. For large jackpots: Federal mandatory withholding is 24% at payout. But the top federal rate is 37%, so you owe an additional ~13% when you file your taxes. Plus state income tax (0–13.3% depending on state). Combined, most large jackpot winners keep 35–55% of the lump sum cash value. Example: $500M jackpot → ~$300M lump sum → ~$111M federal tax (37%) → ~$15M state tax (5%) → ~$174M after all taxes.
Should I take the lump sum or annuity?
The lump sum (cash option) is typically 60% of the advertised jackpot, paid immediately. The annuity pays out 100% of the advertised jackpot over 29 years (30 payments increasing 5% annually). Financially, the lump sum is often better if you invest it well — historical stock market returns (~10%/yr) typically outpace the 5% annuity escalation. However, the annuity offers tax advantages (taxed each year at lower rates rather than all at once) and protection against spending the money too quickly. Most winners take the lump sum.
Which states have no lottery tax?
Eight states have no income tax on lottery winnings: Florida, Texas, Washington, Nevada, South Dakota, Wyoming, Tennessee, and New Hampshire (no income tax on wages/lottery). California is unusual — it has no state lottery tax despite having the highest income tax rate. Delaware taxes at only 6.6%. The highest state lottery tax rates are in New York (10.9% state + 3.867% NYC local = 14.767% combined for NYC residents), Minnesota (9.85%), Maryland (8.75%), and New Jersey (10.75%).
What is the biggest lottery jackpot ever won?
The largest US lottery jackpots: Powerball $2.04 billion (Nov 2022, CA winner), Powerball $1.586 billion (Jan 2016, 3 winners), Mega Millions $1.537 billion (Oct 2018, SC), Mega Millions $1.35 billion (Jan 2023, ME), Powerball $1.326 billion (Oct 2023, CA). For the $2.04B jackpot, the lump sum was ~$997M. After 37% federal tax (~$369M) and California's 0% state lottery tax, the winner kept approximately $628M.