The Powerball draw of Saturday, October 27th, 2018 marked another benchmark for this American lottery. Two ticket holders nabbed the $687.8 million jackpot, the third largest ever in the Powerball history. One of them is from Iowa, the other from New York.
As the Mega Millions frenzy was settling down, it was Powerball’s turn to make lottery fans from all over the world dream about becoming millionaires. With an estimated jackpot of $750 million, the draw of Saturday, October 27th, 2018 was certainly a not-to-miss one. Out of 86,413,920 participating tickets, two matched all the winning numbers of the draw: 8, 12, 13, 19, 27, and Powerball 4. They will share the jackpot of the draw worth $687.8 million after final calculations.
Why Did the Jackpot Amount Shrink?
Although estimated at $750 million, the Powerball jackpot had a final value of $687 million. The reason is simple: ticket sales did not raise to the estimated amount. Estimated values are based on historical patterns. As the jackpot grows, more and more people buy tickets. But, this time, people did not behave according to the pattern. As you can understand from the table below, the $750 million jackpot attracted less attention than the previous 2 ones worth $620, respectively $430 million.
|Draw Date||Estimated Jackpot||Tickets Sold|
How Much Will the Winners Cash?
As there were two winning tickets, the jackpot amount will be equally split between the two ticket holders. Depending on the way they decide to cash their win, they will get the following amounts:
|State||Annuity (30 years)||Lump Sum|
|Iowa||$16,2 million||$281,3 million|
|New York||$15,4 million||$266,1 million|
Why are the amounts different if the jackpot is split equally? It’s simple: because different states have different taxes on lottery wins. The cash value of the $687.8 million Powerball jackpot is $396,2 million. So, in the case of a lump sum, the cash value after deducting the federal tax of 24% stands at $301,1 million. If the winners decide to go for annual payments, the gross amount to be cashed every year is $22,9 million. This means $17,4 million per year after federal taxes.
The state of Iowa has a 5% tax on lottery winnings, while New York 8.82%. This is where the difference comes from.
Now the jackpot has been reset and the wheels were set into motion again. Even if you are not one of the two jackpot winners, it is never too late! Buy your Powerball ticket now! You could be the next jackpot winner!