Millionaire for Life taxes: what you keep from $1 million a year
Millionaire for Life is the $5 nightly draw game whose top prize is $1 million a year for life. The headline is round, but the check is not: a winner chooses between yearly payments and an $18 million cash option, and both are taxed. Here is what each choice leaves after federal and state tax, using the official prize chart and the same tax rates as our lottery tax calculator.
The $18 million cash option after tax, by state
The table applies the top federal rate for 2026 (37%) and the state's lottery tax rate to the whole $18 million, which is how most top-prize winners end up being taxed on a one-time payment. It lists only the states that sell Millionaire for Life and whose lottery tax rules we have checked against the state's own revenue department.
| Where the winner lives | State tax | You keep (about) |
|---|---|---|
| New Hampshire | 0% | $11,340,000 |
| South Dakota | 0% | $11,340,000 |
| Tennessee | 0% | $11,340,000 |
| Wyoming | 0% | $11,340,000 |
| Ohio | 2.75% | $10,845,000 |
| Pennsylvania | 3.07% | $10,787,400 |
| North Carolina | 3.99% | $10,621,800 |
| Michigan | 4.25% | $10,575,000 |
| Georgia | 4.99% | $10,441,800 |
| Virginia | 5.75% | $10,305,000 |
| Massachusetts | 9% (5% + 4% surtax) | $9,720,000 |
| New Jersey | 10.75% | $9,405,000 |
| New York | 10.9% | $9,378,000 |
| New York City resident | 10.9% + 3.876% city | $8,680,320 |
Federal tax at 37% is $6,660,000 in every row. When you claim, the lottery withholds 24% ($4,320,000); the rest is due when you file. Other states that sell the game are still being verified on our side; in the meantime the calculator shows them with federal tax only.
The $1 million a year option
If you take the yearly payments, each $1 million is income in the year you receive it, so you pay tax every year instead of all at once. Official rules guarantee payments for at least 20 years, so the minimum before tax is $20 million.
- Withholding: the lottery withholds 24% federal tax from each payment, or $240,000 a year, and your state may withhold too.
- Federal tax: $1 million a year puts most winners in the top federal bracket of 37% for part of that income. Because the lower brackets still apply to the first part, the real federal bill on a $1 million year is lower than 37% of $1 million. It depends on your other income, filing status and deductions.
- State tax: a flat-rate state takes the same share every year. In states with brackets or a surtax (for example the Massachusetts 4% surtax applies only above $1,107,750 of income), the yearly option can be taxed at a lower rate than the cash option.
- Moving: yearly payments are taxed by the state where you live each year, so a later move can change the bill. The state that sold the ticket may still tax you as a nonresident; see ticket state vs home state.
So which is "better" depends on your age, health, other income, where you plan to live and what you would do with a lump sum. Our lump sum vs annuity guide walks through the trade-offs; a tax professional can run your real numbers.
Millionaire for Life prize chart
| Prize | Cash option | Odds (1 in) |
|---|---|---|
| $1,000,000 a year for life | $18,000,000 | 22,910,580 |
| $100,000 a year for life | $2,200,000 | 5,727,645 |
| $7,500 | — | 86,455.02 |
| $500 | — | 21,613.75 |
| $250 | — | 1,662.60 |
| $50 | — | 415.65 |
| $25 | — | 97.80 |
| $8 | — | 24.45 |
| $8 | — | 15.65 |
The official overall odds of winning any prize are 1 in 8.46. The top prize is pari-mutuel: if more than one ticket wins it in the same draw, the official rules say the payouts can change.
The $7,500 prize is above the $5,000 line, so 24% federal tax is withheld when you claim it; any prize of $2,000 or more paid in 2026 comes with a Form W-2G. Smaller prizes have no withholding but are still taxable income.
Where Millionaire for Life is sold
As of November 4, 2026, the official game page lists 31 lottery jurisdictions: Arkansas, Colorado, Connecticut, District of Columbia, Georgia, Idaho, Indiana, Iowa, Kansas, Kentucky, Maine, Massachusetts, Michigan, Mississippi, Montana, Nebraska, New Hampshire, New Jersey, New York, North Carolina, North Dakota, Ohio, Oklahoma, Pennsylvania, Rhode Island, South Dakota, Tennessee, Vermont, Virginia, West Virginia and Wyoming. States not on that list, such as California, Florida and Texas, did not sell it on that date.
Common questions
Is "$1 million a year for life" really for life?
The yearly prize is paid for the winner's life, with a minimum guarantee of 20 years of payments under the official rules. Check the full game rules of the state that sold the ticket for what happens to the guaranteed payments if the winner dies early.
Why is the cash option $18 million and not more?
The cash option is a one-time amount set in the official prize chart. It is less than the total you could receive over a long life because it is paid all at once.
Do you sell Millionaire for Life tickets?
No. LotteryTaxHub does not sell tickets and is not affiliated with any lottery. We only explain the tax side.
Sources
- Millionaire for Life game page: price, draw time, how to play, where to play
- Millionaire for Life prize chart, cash options and odds
- IRS Instructions for Forms W-2G and 5754 (withholding and reporting)
Game facts checked on November 4, 2026. State rates are the ones verified on our state pages. Estimates only, not tax advice.