(NEXSTAR) — A new Mega Millions jackpot is on the way, but like previous jackpots, the eventual winner won't take home the entire prize.
There were no winners in Tuesday's drawing. The current jackpot is $740 million. Ahead of Friday's drawing (the total could grow before then), the current size of the jackpot is: 7th largest Mega Millions jackpot in history.
But if someone wins the big prize on Friday, they'll likely take home the 18th-largest prize ever, or worse.
There are two surefire and one unpredictable reason why a winner might take home a lottery jackpot amount: payment method, taxes, and split tickets.
In the case of Mega Millions (and Powerball), there are two ways that jackpot winners can receive their prize: an annuity option and a cash option. In this case, the annuity is worth an estimated $740 million, while the cash option is worth about $366.3 million.
The cash option is generally considered to be the amount needed to fund the annuity option (one payment followed by 29 years of payments, increasing by 5% each time).
If a winner wants to receive their entire prize immediately, they can choose to receive it in cash. If they want to receive a portion of their prize each year, they can choose to receive it in an annuity. Neither option will amount to the payouts shown above ($366.3 million for the cash prize and $740 million for the annuity) due to tax reasons.
State lotteries are required to withhold 25% federal income tax from jackpots this large, and with the additional withholding, jackpot winners would have to pay 37% tax on their winnings. where you liveand many more may be withheld.
According to one analysis America MegaThe maximum cash prize a winner can receive in Friday's Mega Millions drawing is about $230.8 million, and the maximum annuity is about $467.5 million ( States that don't tax lottery winnings).
Outside of those few states, Arizona will have the largest payouts, at about $221.7 million in cash and $449 million in annuities. New York, which has the highest lottery withholding, will pay out about $190.9 million in cash and $386.8 million in annuities.
The interactive map below shows roughly how much pension and cash payments will be in each state, according to an analysis by USA Mega.
These calculations don't even take into account the possibility of multiple winners. The odds of winning the Mega Millions top prize are 1 in 302.6 million, but it's possible that there could be multiple tickets that match all six winning numbers in Friday's drawing.
Two of the biggest jackpots in the game's history, a $656 million prize in 2012 and a $648 million prize in 2013, were split between three and two winners, respectively. Two Mega Millions tickets sold at the same gas station A man from Encino, California, won a $394 million jackpot. (Luckily, California doesn't have a state lottery tax.)
Still, if you win the jackpot on Friday, experts recommend keeping your ticket safe and teaming up with a financial professional before claiming any winnings, no matter how small the amount you actually get.
Mega Millions is played in 45 states and the District of Columbia. Tickets cost $2 and there are nine ways to win a prize. Drawings take place every Tuesday and Friday at 11pm ET.
