How to Play American Lotto and the Amount Taxed
American Lotto was first introduced in 1988 before being replaced by Powerball game in 1992. It made a comeback on November 15, 2017, replacing the multi-state game, Hot Lotto. The main game costs $1 to play, but lotto players have the opportunity to add $1 for the All-star Bonus.
The Jackpot starts at $2 million, and it does not have a cap; this means you can expect to see some massive jackpots often.
American Lotto gives players a chance to win one of nine different cash prizes, which include a Multi-million dollar jackpot prize. Here is how one can play American Lotto online.
How to Play American Lotto Online
Here are some few quick steps on how players can play American Lotto online
- Select five numbers from a pool of 1-52 and then pick an All-Star Ball number from1-10.
- To win the Jackpot prize, you must match the five Mega Millions numbers and the Star Ball for the particular draw.
- The minimum number of main balls one must match to win is three, which gives you $5. A player wins $2 for matching the Star \ball number correctly.
- The minimum guaranteed Jackpot prize is $40 million, and it grows by a minimum of five million each time the jackpot rolls. The All-Star bonus may also increase from time to time due to special promotions.
- Depending on your state, players have between 90 and 365 days to claim their prizes.
How Much Tax Do Players Have to Pay After Winning American Lotto
Do you know that if you win American Lotto, you have to pay taxes? The question on every player’s mind is how much tax is paid on these jackpot prizes.
The state where you live plays an essential role in taxes. Some states don’t use taxes for lottery winnings, which is excellent for the players. Rates of income tax on lottery prizes differ by state.
When a player wins the Jackpot prize, he or she does not receive the total sum. This is because taxes need to be paid. The American Lotto winner has to pay 25 percent of his or her winnings to the government. For this reason, when one wins the jackpot prize, the whole amount is not transferred to the bank account immediately, and the player is paid in intervals. This option is known as ‘annuity.’
Annuity means that you don’t receive all the money at once, but over the years. , the player gets to enjoy the money slowly. For those who prefer receiving all their payment at once, they can do so by contacting the lottery. This is called ‘lump sum,’ it is a good idea if you are planning to do something significant with the money.
In the event of big lottery winnings, players are advised to contact professional financial consultants for further advice on how much tax you should pay. If a player has not chosen the payment plan within 60 days, the money will be automatically sent as an annuity.