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How much money would you really get if you won the $1.9 billion dollar Powerball?

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  • Staff Report 

The jackpot for the Powerball is now at $1.9 billion dollars after another drawing had no grand prize winners.

Though the prize is a total of $1.9 billion dollars, that number changes depending on how you want to be paid if you win it. You can choose either a lump sum payment or an annuity payout that will give you payments every year for 29 years.

Most people who win choose the lump sum prize. In fact, the last time anyone chose the annuity payment was back in 2014, according to My Twin Tiers.

When a winner chooses a lump sum payout for the $1.6 billion, they would see $929.1 million dollars before taxes. If they chose the annuity payment, they would see the whole $1.9 billion over the span of 29 years.

Annuity payments explained

The annuity payments let you get your payments over the span of 29 years and you’ll receive 30 payments in all. The payments are not even though. Each payment is 5% larger than the last one.

With a jackpot of $1.9 billion, the first payment would probably be around $28.6 million dollars. The second would be around $30 million. Your 30th final payment would be about $117.7 million.

While the idea sounds good, you have no idea what inflation or the economy will look like 30 years from now.

Lump sum payment explained

The lump sum payment is decided on by the Powerball Finance and Audit Committee when they decide what the cash option is worth by multiplying the overall prize with a discount value set before each drawing.

The lump sum payment is far less than the grand prize, but once you have your hands on all of the money you can do with it what you please, including investing it.

Taxes will be determined by where you live. About a quarter of the winnings for the lump sum payment will be taken for federal taxes.

States decide what they will take based on their state tax laws. While some states won’t take anything, New York will take the most at 8.82%.

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