A resident of the American state of Illinois won the Powerball jackpot of $1.04 billion — this is the largest lottery win in the USA this year. However, after tax payments, the winner will be left with less than $300 million if they choose a one-time payout, writes Forbes.
On Wednesday evening, the Powerball lottery jackpot of $1.04 billion was drawn. The winning ticket was purchased by a player from Illinois.
The winner is now offered two options: receive the entire sum over 30 years or take a lump-sum payment of $450.5 million. Most winners choose the second option.
However, $450.5 million is not yet the amount that will end up in the winner's account. First, the mandatory 24% federal tax will be withheld from it, and the payout will be reduced to approximately $342.4 million.
After this, the winner will likely have to pay tax at the highest federal rate — 37%. As a result, after federal taxes, approximately $283.8 million will remain from the one-time payout.
An additional tax is also levied by the state of Illinois. There, lottery winnings are taxed at a rate of 4.95%. For a one-time payout, this amounts to about $22.3 million, which will also be withheld when receiving the prize money.
If the winner opts for 30-year payments, they will receive approximately $34.7 million annually before federal taxes. After applying the 37% rate, this will amount to approximately $21.8 million per year, not including state tax.
This jackpot became the largest lottery win in the USA in 2026. The chances of such a win are extremely small — 1 in 292.2 million.
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