Since no one hit the Mega Millions jackpot on Tuesday, the top prize has climbed to $340 million.
Regardless of the payment option you choose, the federal government gets 25 percent of the loot. With the lump-sum choice, this would mean the IRS takes $51 million of the $204 million, according to estimates from lottery site USAMega.com. That would reduce the winner’s take to $153 million.
With the annuity option, annual payments of about $11.3 million would be reduced yearly to $8.5 million from about $2.8 million going to the IRS. Over 30 years, that would mean $255 million for you and $85 million paid in federal taxes.
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On top of that, you face state taxes unless you live in one of a handful of places where lottery wins are tax-free. In states that do take a piece, the range is from a high of 8.82 percent in New York to a low of 2.9 percent in North Dakota.
The $340 million jackpot amount marks the 10th biggest in the game’s history. The largest was $656 million in 2012, when three ticket-holders hit the winning numbers.
Source:CNBC
