A Powerball ticket bought in California has won a record $2.04 billion jackpot after more than three months without anyone hitting the top prize.
On Tuesday, the record-breaking $2.04 billion Powerball jackpot was won by a single winning ticket purchased in the state of California. The lucky winner had the option of receiving 30 annual payments over the course of 29 years or a smaller lump sum up front, which is the choice that is most commonly made by lottery winners.
The winning ticket was purchased at Joe’s Service Center in Altadena, California, which is located around 10 miles north of Los Angeles. The winning numbers on the ticket were 10, 33, 41, 47, and 56, and the Powerball was 10.
If the winner opts for the lump sum payment, the Powerball estimates that they will walk away with $997.6 million before taxes. However, they will be required to pay the Internal Revenue Service (IRS) a mandatory 24% federal tax withholding of $239,424,000, which will leave them with $758,176,000.
After that, the winner is subject to a federal marginal tax rate of up to 37%, which would result in a reduction of the prize amount by an additional $126,560,096, leaving them with a total of $631,615,904 if the winner did not have any additional income, dependents, or itemized tax deductions such as charitable giving.
The winner also has the option of taking the whole $2.04 billion in the form of thirty annual payments of around $68 million on average; however, this amount would be reduced to $43.27 million per payment once federal taxes are taken into account.
After 41 consecutive drawings with no exact winner, the Powerball jackpot increased to over $2 billion at the time of the Monday night drawing. The previous record for the prize was $1.9 billion. In the event that there was no victor, the amount was scheduled to rise to $2.3 billion. The previous record for the Powerball jackpot was $1.586 billion, which was won in January 2016 by three winners in the states of California, Florida, and Tennessee. Tuesday’s jackpot surpassed that mark. The second-largest jackpot in the history of Mega Millions was won in July 2018 and was worth $1.337 billion. The previous record-setting jackpot was worth $1.537 billion and was won in October 2018.
The state of California, the location where the winning ticket was purchased, is one of the 14 states that does not deduct any taxes from the amount of the prize earnings. Washington, District of Columbia (10.75%), Maryland (8.95%), and New York (8.82%) have the highest state taxes in the US. In addition to the taxes collected at the federal and state levels, certain municipalities, such as New York City, have instituted their own local income tax, which now stands at 3.87%.