The Powerball jackpot as crossed the half-billion dollar mark rising to $550 million dollars.
It’s the 8th largest Powerball jackpot ever and today is the last day to buy your ticket.
The chances of winning the half-billion dollar prize are 1 in 292,201,338.
If you are lucky enough to win, you have two options.
Take a lump sum of $335 million or receive the prize in annuity payments over 30 years.
In either case, you’ll still have to pay taxes.
According to BankingRates.com, the cash option comes with about $80.4 million dollars that will be withheld right away for federal taxes.
Then you’ll likely pay another roughly $114,140,000 when your tax return is due.
That’s not even counting state taxes on top of that.
While you may think that the money you’re spending on a lottery ticket is going into one big pool, that’s actually not the case.
It’s being split between a few different places.
According to the Michigan Lottery for every $1 spent last year:
- 62¢ to prizes for players.
- 26¢ to the School Aid Fund.
- 9¢ to commissions for vendors and retailers.
- 3¢ for the Lottery’s ongoing operations and administrative costs
Out of every dollar spent on Lottery products, 97¢ directly benefits the state.
In 2018, the Michigan Lottery broke a record.
It provided $941 million dollars to the state’s School Aid Fund.
That works out to be more than $600 for each child in the kindergarten through 12th-grade system.
While that may sound like a lot, it’s only about 7.5% of the state’s total fund.
Other sources of funding include state sales and use tax, earmarked income tax, state education property tax, as well as cigarette, liquor and other taxes.