You might also move into a higher income tax bracket for the year, which could triple your tax rate. How Are They Taxed?Ĭash option: Federal income taxes are due as soon as you receive the cash payout. Here’s a look at some things to consider when deciding which option is best, based on insights from and The Annuity Expert websites. Most winners opt for the cash option, even though doing so means you get a reduced sum.ĭeciding which option is best depends on a few different factors, ranging from your age and financial situation to your comfort with investing. Powerball offers a similar payout option. If somebody is lucky enough to match all six numbers they can choose to have their Mega Millions winnings distributed in one of two different ways: as an annuity of 30 payments over 29 years, or as an immediate cash lump sum.

See: 10 Games That Pay Instantly To Your Cash App Accountįind: 18 Legitimate Games & Apps That Pay Real Money in 2023 July 17’s Powerball draw is paying out a whopping $900 million to a prospective winner, and Mega Millions is offering $640 million on July 18’s draw. Given that nobody has taken down the jackpots to either multi-state lottery in some time, the jackpots have risen accordingly. July is shaping up to be a historic month for Mega Millions and Powerball players.

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