That would leave most of us disappointed but some lucky winner beset by a host of questions. Here are some answers for someone holding that prized lottery ticket for what would be the largest lottery jackpot in
I’VE WON. NOW WHAT?
Lottery officials recommend winners take a deep breath, put their winning ticket in a safe spot and consult with a reputable financial planner before popping over to the lottery headquarters. Their first decision is whether to take the cash option, which would be $904 million, or an annuity, with one initial payment and annual installments over 29 years. Nearly all winners opt for cash, but the annuity has advantages, as it reduces the tax bill a little and offers a stable flow of income that climbs by 5 percent annually.
HOW LONG DO I HAVE TO CLAIM THE JACKPOT?
States have different rules, so depending on where you purchased the ticket, you have from 180 days to a year.
DO I GET MY MONEY INSTANTLY?
No, you can’t just cash one of those oversized checks shown in all the winner photos. Payment speed also varies by state, but a week or two is common. Carole Gentry, a spokeswoman for the
CAN I KEEP MY NAME SECRET?
Jackpot winners can remain anonymous in eight states —
WHAT ABOUT TAXES?
For winners of $5,000 or more, all states automatically deduct 24 percent in federal taxes, but state taxes vary widely. Some big states, including
Melissa Labant, a tax policy expert at the
“That catches people off guard,” she said. “You have to be prepared to write another check to the IRS in April.”
WHAT ARE MY TAXES IF I DON’T LIVE IN THE STATE WHERE I BOUGHT THE TICKET?
This can get complicated, but for the most part winners pay taxes where they bought the ticket and then can get a credit on their taxes in their home state. The final tax bill can depend on if the state where you live taxes at a higher or lower rate than where you purchased the ticket. Rules vary by state, so this is a good topic for that financial planner.
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