As required by Idaho law, the Lottery automatically deducts Federal and State income taxes from your winnings of prizes over $5,000. The Federal tax rate is 25% and the State of Idaho tax rate is 7.8%. The Lottery is also required to report winnings of $600 or over to the IRS, although they do not deduct taxes until the prize exceeds $5,000.
When you receive your check, you will also receive three copies of your W-2 G forms detailing your taxed amount. You should keep these tax records safe until the following year when you will be required to use them. One copy is for your Federal taxes, one copy is for your State of Idaho taxes, and one copy is for your personal records.
For specific tax information, the Idaho Lottery suggests all winners consult a professional tax accountant, attorney or advisor.
When large groups of players claim a large jackpot prize, each player shares in the tax liability equally. Taxes are removed at a rate of 25% Federal and 7.8% Idaho tax. Each claimant receives their W-2 G forms, which detail their tax liability along with a check for their portion of the remaining money.
If a group selects an annuity, taxes are removed each year based upon current tax laws before preparing the winners' annual checks. The Idaho Lottery must pre-pay taxes on winning amounts consistent with current Federal and State tax laws.
Any person, 18 years of age or older, who legitimately purchases a lottery ticket in Idaho and wins, may claim the top jackpot prize. You do not have to be an Idaho resident or a citizen of the USA to play and win. The only difference between these players and Idaho residents is how you claim your winning prize and handle your tax liabilities.
Non-Idaho residents claim their winnings as a non-resident United States citizen. You must present photo identification that establishes your location of legal residency. During the following year in April, you will need to file an income tax return for all monies earned (winnings included) in the State of Idaho.
United States citizens may also receive a credit on their state of residence income tax return for the monies you have paid to the State of Idaho. You will want to confer with your tax advisor on whether you owe any additional taxes on this income in your resident state.
Jackpot or large-tier winners who live in countries other than the United States of America are considered non-resident aliens. Upon presentation of your winning ticket, you must also demonstrate with legal photo identification documentation of your country of residence.
Non-resident aliens have a slightly higher tax rate withheld from their winnings at the Federal level – 30% as apposed to 25% for United States citizens. The Idaho withholding rate remains unchanged at 7.8%.
Non-resident aliens of the United States of America who earn money in the United States (including lottery winnings) are required to file a non-resident United States tax return and to file a non-resident Idaho tax return. You will want to consult a tax advisor in your resident country and one in Idaho to ensure that your taxes have been paid or credited appropriately.
Many people ask us to explain how their chances of winning are determined. So, let's start at the beginning!
The Powerball game is played by selecting five numbers out of 59 choices (the numbers from 1 to 59), and by selecting one extra number from 1 to 39 (that's the Powerball). When it's time to draw the winning numbers, there are two machines tumbling the ball sets at the same time: one machine has the 59 white balls, and the other one has the 39 red "Powerballs." So the Powerball game is like holding two drawings at the same time; two independent events played simultaneously. Any chances of winning description of the game has to consider what happens to the number selections within one drum combined with the possibilities of what's happening in the other drum. That idea is really important to keep in mind. A winning set of numbers will be whatever five balls are selected out of the white-ball drum plus the one ball selected from the red-ball drum.
But the chances of winning look confusing because even at the smallest winning level (just getting the Powerball right), many people think the chances of winning of that should be 1 in 39 (one correct choice out of a drum of 39 balls, right?). But we're not just playing that one drum; in order to say you "only matched the Powerball" that means you have to have missed all five of the white balls that were chosen in that other drum! The chances of doing that combined with your 1-in-39 shot of getting the Powerball actually come out to being 1 in 61. In other words, there is one chance in 61 that you'd pick the winning Powerball number and miss selecting any of the five winning white-ball numbers.
So when you hear a "chances of winning" calculation, it's describing the chance that you will have chosen the winning numbers including the chances you chose numbers that didn't get drawn. Since there are several ways to win, (from zero to all five of the white balls, with and without having the Powerball) that means people who calculate the chances of winning have to figure each level of winning or not winning in each of the two drums. For example, in order to win the big jackpot, a winner must have chosen all five white balls correctly, as well as the Powerball number. To describe the chances of winning, you have to say what your possible chances are of choosing the winning balls against choosing any of the 55 non-winning balls in the one drum, combined with your chances of choosing the winning Powerball against choosing any of the 38 non-winning red balls in that drum. That's a lot of combinations! More than 195 million, in fact. But there's an easy formula that gets you there.
Where do you start? Well, the general math formula for calculating lottery chances will combine three things:
The mathematical formula looks like this:
Each part of that formula, which is in parentheses, is a "binomial coefficient," which is a calculation on how many ways there are to make different combinations. In our case, we're talking about how many combinations of lottery balls you could make with a set of 59 (or 39) balls. What that means is that for whatever numbers you have, the binomial can be rewritten as follows:
X! means "x factorial"; for example, 5! is 5 x 4 x 3 x 2 x 1 = 120.
Now we're ready to look at winning that jackpot!
To do that, we said you'd have to describe the chances of picking five numbers including 54 non-winning ones out of a total of 59. Then you combine that with the figure to describe your chances of picking one winning Powerball number including choosing 38 non-winning numbers. So using our binomials and factorials, it looks like this: POWERBALL CHANCES OF WINNING THE JACKPOT: (5 of 5 plus the Powerball)
So, 59 x 58 x 57 x 56 x 55... = 600,766,320 and 5 x 4 x 3 x 2 x 1 = 120; divide one by the other:
600,766,320 / 120 = 5,006,386 (chances of 5,006,386 to 1 of picking all 5 white balls out of 59)
And don't forget that now we have to combine the possibilities of choosing the Powerball, which we know is one in 42. That formula works just like the one above:
So, 5,006,386 / 1 x 39 / 1 = 195,249,054.
Now, that's just one win scenario: the big jackpot. But you can also win eight other prizes ranging from $200,000 to $3.
(In order to win a prize, your Powerball number must at least match the Powerball number drawn, or you must match at least three of the five white-ball numbers drawn.)
When you combine the chances of all those levels and all those combinations, it comes out to roughly 1 in 35.
So each player has a 1-in-35 chance to win any of the prizes (jackpot, $200,000, $10,000, $100, $7, $4, or $3)!
We hope this helps to better explain the chances of winning the Powerball jackpot.
Click on one of the following Draw Games™ to get the downloadable list: Powerball PowerPlay®, Mega Millions® with Megaplier, Hot Lotto Sizzler®, Weekly Grand™, Wild Card, Idaho Pick 3. You can download a list of past winning numbers in text format for each game by doing the following: