Here’s what you should do if you win the $760 million Powerball prize

By Kate Dore – cnbc

Powerball has reached $760 million, the sixth-largest prize pool in the game’s history, and experts are offering advice on what the lucky winner should do.

If you match the winning ticket, you will be able to choose between two options: an annual payment of $760 million or a lump sum payment of $383.6 million. Both estimates do not take tax cuts into account.

The next Powerball drawing is Saturday at 10:59 pm ET, and the odds of winning a prize are approximately 1 in 292 million.

Whether you opt for a lump sum payment or annuity payments, you’ll face a larger tax bill, including the initial 24% federal tax withholding.

(Who won $1.765 million Powerball in California? “The phones are ringing wildly, people are congratulating. It’s so crazy.”)

But it will soon reach 37% of the federal income tax, and the final bill is likely to be several million higher. (You may also have to pay state taxes on lottery winnings.)

Find a team of financial experts

Andrew Stoltman, a Chicago-based attorney who has represented many lottery winners, said lottery winners typically “don’t have the knowledge base to handle a sum of money this large.” “This is exactly what we see with our clients who are professional athletes.”

That’s why it’s important to find the right team of experts, including financial advisors, accountants and lawyers, he said.

The winner should also be prepared for the “estate tax consequences” of multimillion-dollar winnings, according to Warren Rakusin, an estate planning attorney and partner at Lowenstein Sandler.

For 2024, the federal estate tax exemption is $13.61 million per individual or $27.22 million for married couples. But, without changes from Congress, those limits will be cut by nearly half in 2026.

(The winner of the $1.6 billion Mega Millions appears to be claiming his prize in Florida)

“There are a variety of estate planning ideas and techniques you can use to save on estate taxes and benefit your family,” Racusin said.

Saturday’s Powerball drawing comes nearly two and a half months after a ticket sold in California won a $1.765 million prize. Meanwhile, the Mega Millions jackpot has dropped back to $92 million and the odds of winning that prize are about 1 in 302 million.