Cash vs. Annuity

Cash

This payment is a one-time cash payment that is made after you win the jackpot.

Annuity

An annuity payment means that you will receive an annual check for 25 years.

Example - Jackpot of $1,000,000 (assumes 1 winner in each option)

Cash Option*
Total Payments - 1
Annuity Option
25 Annual Payments

Pre-tax prize $500,000

$40,000 (1 of 25)

After tax prize $350,000

$28,000 (1 of 25)

Total after-tax winnings $350,000

$700,000 (over 25 years)

* Pre-tax prize may vary depending on interest rates.

The Maine State Lottery is required by law to withhold 25% federal tax and 5% state tax. Winners could be liable for higher taxes when they report their winnings to the IRS.