Also, some of the money you’ll pay in federal taxes will never reach you to begin with: The lottery is required to withhold 24 percent of your winnings.
“Then you need to have cash for the difference between what was withheld and the final tax bill,” Weston said.
State tax withholding rates depend on where you bought the ticket. Be aware that winning in a no-tax state won’t get you off the hook if you live in a state where lottery winnings are taxed.
However, everyone’s situation is different, and big lottery winners should consult with a tax advisor, along with an attorney and financial advisor.
Of course, most people won’t need to worry about how a jackpot is taxed. Your chance of winning Mega Millions is 1 in 302.6 million. For Powerball, it’s 1 in 292 million. The chance of hitting both? 1 in at least 88 quadrillion. That’s 88 followed by 15 zeros.
You have a much better chance of being struck by lightning in your lifetime: 1 in 14,600, according to the National Weather Service.