New York lottery taxes: what a winner really keeps
If you live in New York and win a big Powerball or Mega Millions prize, three governments can take a share: the IRS, New York State and, if you live in the five boroughs, New York City. Yonkers residents pay a city surcharge too. That makes New York the most expensive place in the country to win a jackpot.
The good news is that the math is predictable. Below you will find the take-home on common prize sizes, how the tax is collected when you claim, and what changes if you live outside the city.
Take-home pay on a lump-sum prize in New York
The table applies the top federal rate of 37% plus 10.9% New York tax and the New York City rate of 3.876%. Amounts are the cash (lump-sum) value you receive, not the advertised annuity jackpot.
| Cash prize | Federal (37%) | State | NYC | You keep |
|---|---|---|---|---|
| $1.00M | −$370,000 | −$109,000 | −$38,760 | $482,240 |
| $10.00M | −$3.70M | −$1.09M | −$387,600 | $4.82M |
| $100.00M | −$37.00M | −$10.90M | −$3.88M | $48.22M |
| $500.00M | −$185.00M | −$54.50M | −$19.38M | $241.12M |
| $1.00B | −$370.00M | −$109.00M | −$38.76M | $482.24M |
Federal figure is the total owed at the top bracket. At claim time only 24% is withheld; the rest is due when you file. Smaller prizes can fall into lower brackets, so the real federal bill may be less.
How New York taxes a big prize
New York treats lottery winnings as ordinary income. A jackpot pushes you into the top state bracket, which is 10.9% on income above $25 million. Smaller prizes are taxed at the lower brackets, so a $50,000 win is not taxed at 10.9%.
City tax depends on where you live, not where you bought the ticket:
- New York City residents pay city income tax at a top rate of 3.876%.
- Yonkers residents pay a surcharge equal to 16.75% of their net New York State tax.
- Everyone else in the state pays state tax only.
What is withheld when you claim
For prizes over $5,000 the New York Lottery withholds federal tax at 24% and also withholds state tax, plus city tax for NYC and Yonkers residents. Withholding is a down payment, not the final bill. A jackpot winner will owe the gap between 24% and the top federal rate of 37% when filing the next return, and should set that money aside on day one.
Bought your ticket in New Jersey or Connecticut?
Many New Yorkers buy tickets across the border. In that case the state where you bought the ticket may tax the prize as a nonresident, and New York will still tax you as a resident. New York generally gives a credit for tax paid to the other state, so you do not pay twice in full, but you pay at whichever rate is higher. Our calculator assumes your home state, which is the right starting point for most readers.
Nonresidents who win in New York
If you live in another state and win with a New York ticket, New York taxes the prize as New York-source income. New York City tax does not apply to nonresidents. Your home state may then tax it again, usually with a credit for the New York tax.
Common questions
Does New York tax lottery winnings?
Yes. New York taxes lottery winnings as income, at up to 10.9% for very large prizes. New York City and Yonkers residents also pay local tax.
How much of a $100 million cash prize do I keep in NYC?
About 48% after the top federal rate (37%), the top state rate (10.9%) and the top city rate (3.876%), or roughly $48.2 million. Outside the city it is about $52.1 million.
Can I stay anonymous in New York?
New York generally requires winners to be identified, though rules can change. Ask the New York Lottery directly and talk to a lawyer before you sign the ticket.