Powerball, Mega Millions jackpots both top $400 million for the first time

Personal Finance


That’s just what’s withheld before you’re awarded that giant check. You’ll owe the rest of the bill come tax time. (See infographic below.)

Winners face a different tax scenario than last year. Under the new tax law’s brackets, a winner with that kind of nine-figure income in 2018 would end up in the top bracket at a rate of 37 percent. (In 2017, the top rate was a slightly steeper 39.6 percent.)

But state and local income taxes paid are now capped at $10,000 as an itemized deduction. The loss of that deduction whittles a few million more off your take-home. (The luckiest winners will still be in those states that participate in that multistate lottery but do not have an income tax, or specifically do not tax lottery prizes.)



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