Sorry, Winning Powerball’s $1.7 Billion Jackpot Won’t Make You A Billionaire
Sorry, Winning Powerball’s $1.7 Billion Jackpot Won’t Make You A Billionaire. Here’s why you might end up with $136.6 million instead.
Charles Passy MarketWatch Tue, December 23, 2025
You just won the big $1.7 billion Powerball jackpot and you’re feeling like, well, a billion bucks.
But let’s get real for a moment: You’re almost certainly not a billionaire.
There’s no doubt that someone who wins a lottery jackpot will walk away a rich person. And Wednesday’s Powerball prize — the drawing is set for 10:59 p.m. Eastern time — is the fourth largest in the game’s history. But even when a jackpot heads into billion-dollar territory, the winner isn’t likely to see that kind of money. When all is said and done, they may be fortunate enough to call themselves a centimillionaire — someone with a net worth of $100 million or more.
We did some research and crunched some numbers to come up with the following scenario, showing how a $1.7 billion jackpot can turn into an actual prize of $136.6 million — again, nothing to sneeze at, but not quite enough to put you in Elon Musk territory (net worth: $748 billion). Or even Jerry Seinfeld territory (net worth: $1.1 billion).
Here’s how it all breaks down.
You may have to split the prize
It’s great if you can keep that jackpot all to yourself, but that doesn’t always happen. In fact, in the 50 largest lottery jackpots claimed to date, the prize has been split by two or more winners 10 times, and in some cases by as many as three. Let’s assume a worst-case scenario here, and you get only a third of that jackpot.
Your share of the $1.7 billion prize is $566,666,667.
You take the lump sum
The big advertised jackpot number reflects the amount you’d receive if you opted to annuitize your prize over 29 years (30 payments in all). But the vast majority of jackpot winners go for the lump-sum payout, according to reports.
And at least some financial advisers say there’s good logic behind doing that, because it leaves you in control of how to invest (and presumably grow) the money. Still, taking the lump sum cuts the total by more than 50%, according to what Powerball shares. The current lump sum if only one winner claims the $1.7 billion jackpot is $781.3 million. If there are three winners, that would have to be split three ways.
Your prize is now $260,433,333.
You have to pay Uncle Sam
You didn’t think the taxman would forget to come for a share of your winnings, did you? With a big lottery prize, you’ll now be in the highest federal tax bracket, which means a 37% hit. (You can do the math yourself, but trust us: You’ll be among the top earners.)
Your prize is now $164,073,000.
Your state and city can come calling, too
Most states — and some municipalities — levy their own income taxes. So that’s another chunk to calculate based on that $260,433,333 figure. The rates vary considerably, but let’s say you live in a place with a high income-tax rate, especially for wealthy individuals. For example, New York state’s top tax rate is 10.9% (New York City residents pay an additional income tax) and New Jersey’s is 10.75%, according to the Tax Foundation website. For the sake of simplicity, we’ll consider what a 10% state income-tax hit might do to your winnings.
You need to bring in professionals to sort everything out
If you talk to folks who work with high-net-worth individuals, they’ll all tell you pretty much the same thing: It costs money to be a rich person, because you need to sort through a minefield of legal and tax-related matters.
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