Fourth-Largest Lottery Prize in US History: Powerball Jackpot

Published: October 9, 2023, 07:59h. 

Last updated: October 9, 2023, 07:59h.

The Powerball jackpot for tonight’s game is estimated to be a staggering $1.55 billion, with a one-time cash option of $679.8 million.

Powerball jackpot lottery odds
A man walks by Lambert’s Market in Boston, with the $1.55 billion Powerball prize advertised on a digital display. No ticket has matched the six winning Powerball numbers since the July 19 drawing. (Image: Boston Herald)

The odds of winning the Powerball jackpot by matching all six numbers are consistently at 1 in 292.2 million. However, as the jackpot reaches unprecedented levels of wealth, the likelihood of a jackpot winner seemingly increases due to the surge in ticket sales and the subsequent increase in number combinations being played.

Despite the increased participation over the past two weeks as the Powerball jackpot climbed towards and surpassed the billion-dollar mark, there have been no winners in the past 34 drawings.

A single Powerball play starts at $2, with many states offering an optional $1 add-on Powerball Play multiplier that can significantly multiply the prize. In certain states such as Pennsylvania, players also have the opportunity to participate in the “Double Play” feature, where an additional set of six numbers is drawn, although the maximum prize is limited to $10 million instead of the advertised Powerball jackpot.

Powerball is available in 45 states, plus the District of Columbia, Puerto Rico, and the US Virgin Islands. The Double Play option is offered in 17 states, including the nation’s capital.

Expert Advisors Recommend Winners Seek Professional Counsel

At $1.55 billion, tonight’s Powerball jackpot is the third largest in the game’s history and the fourth largest lottery prize in US history.

The all-time record for a US lottery prize is held by Powerball, with a $2.04 billion jackpot won by a player in California last November. The second largest prize was a $1.6 billion Mega Millions jackpot won in August of this year. The third largest is a $1.586 billion Powerball jackpot won in January 2016 by ticket holders in California, Florida, and Tennessee.

If a ticket matches all six numbers tonight, financial advisors strongly advise the winner(s) to consult with a wealth manager and possibly an attorney to make the most of their life-changing payout. Experts recommend opting for the annuity option as it provides long-term financial security with the winnings paid out over 30 years.

“Most people take the lump sum, because they want the money, they want to control it,” said Robert Pagliarini, president and chief financial advisor for Pacifica Wealth Advisors and author of The Sudden Wealth Solution. “I honestly think most people are probably better off taking the annuity.”

Financial managers highlight that the 30-year annuity distribution is more beneficial due to the Effective Federal Funds Rate (EFFR) currently standing at 5.33%.

The full advertised jackpot payout is determined using the Federal interest rate since the annuity is backed by US Treasury bonds. With high interest rates, the annuity has grown much faster during this Powerball run than it would have a few years ago when the Federal rate was closer to zero.

Federal Taxes Guaranteed for Jackpot Winner

While the odds of winning the Powerball jackpot are slim, the US federal government is guaranteed to collect a substantial amount in taxes. This is due to the high federal income tax rate imposed on the winner of the life-changing prize.

The highest federal income tax bracket for the country’s highest earners is an effective rate of 37%. If a ticket wins tonight’s jackpot and the winner chooses the lump sum option, the $679.8 million prize would be subject to an immediate reduction of $251.4 million. This leaves the winner with approximately $428.3 million, which may still be subject to state taxes.

Only California, Delaware, Florida, New Hampshire, Puerto Rico, South Dakota, Tennessee, Texas, Washington, and Wyoming do not tax lottery winnings.

Source link

Leave a Comment