But how much of that will end up in the winner’s pocket and how much will be due in taxes? The tax bill depends on whether the Mega Millions winner chooses a $780.5 million cash payout or annual payments totaling $1.3 billion over 29 years. Currently, Illinois withholds 24 percent in federal taxes and 4.95 percent in state income taxes, although this may not be the total tax liability, depending on the winner’s financial situation. If the winner decides to take the $780.5 million lump sum, about $187.3 million in federal taxes will be withheld, on top of $38.6 million in state taxes. That would mean an estimated payout of $554.6 million. If the winner receives the full $1.337 billion in annual installments and tax rates remain unchanged over the next 29 years, an estimated $320.9 million in federal taxes will be withheld and an estimated $66.2 million will be withheld in state taxes. That would mean an estimated payment of $949.9 million over 29 years. After taxes, the winning Mega Millions ticket holder will receive either cash payments or annual lump sum payments for the next 29 years. Corbis via Getty Images Although the cash option is more popular, the annuity payments are each 5 percent larger than the previous one. “This helps protect winners’ lifestyles and purchasing power during times of inflation,” the Mega Millions lottery says on its website. This Mega Millions jackpot is one of the largest ever since the 2018 South Carolina winner won a $1.537 billion jackpot. “Congratulations to the Illinois Lottery for selling the winning ticket for the $1.337 billion Mega Millions jackpot,” said Ohio Lottery Director Pat McDonald. “We are thrilled to witness one of the largest jackpot wins in Mega Millions history. We can’t wait to find out who won and look forward to congratulating the winner soon! Even better, this exciting jackpot run has had a significant positive impact on the charitable proceeds raised by our members’ lotteries.”
