After 35 straight drawings without a big winner, Powerball players will have a shot Wednesday at a near-record jackpot worth an estimated $1.73 billion.
It would be the second largest of any lottery prize ever, topped only by the $2.04 billion Powerball won by a player in California last November. The previous No. 2 was a $1.586 billion Powerball with three winners in California, Florida and Tennessee on Jan. 13, 2016.
The $1.73 billion jackpot is for a sole winner who opts for payment through an annuity, doled out over 30 years. Winners almost always take the cash option, which for Wednesday night’s drawing is estimated at $756.6 million.
The prize is also subject to taxes, which includes an automatic withholding tax of 24% levied against the winnings, and other 13% in federal taxes when you file your 2023 returns, according to CNBC.
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There's also state taxes in some jurisdictions, which range from 2.9% to 10.9% depending on the state you live in. But if you're lucky enough to live in California, Florida, New Hampshire, South Dakota, Tennessee, Texas, Washington or Wyoming, you won't pay income in your winnings.
Powerball’s terrible odds of 1 in 292.2 million are designed to generate big jackpots, with prizes becoming ever larger as they repeatedly roll over when no one wins. And wins in recent months have been few and far between.
Since 2021, six prizes have topped $1 billion, not counting the latest game. The increased frequency is due to higher interest rates and worsened odds for winning a jackpot. The advertised lottery jackpot is for winners choosing payment through an annuity over 30 years. Higher interest rates mean a lump sum will grow larger when paid through an annuity over decades. And years ago, the odds were changed to make jackpots more rare, allowing prizes to roll over and become larger.
The jackpot has grown so large because there have been 35 consecutive drawings since someone matched all five white balls and the Powerball. The previous winning Powerball ticket was sold on July 19, and it was worth $1.08 billion after 39 drawings without a jackpot win.
In most states, a Powerball ticket costs $2 and players can select their own numbers or leave that task to a computer.
Powerball is played in 45 states, as well as Washington, D.C., Puerto Rico and the U.S. Virgin Islands.
