Powerball jackpot hits $725 million. If you win, here's the tax bill

The Powerball jackpot has hit an estimated $725 million, making it the seventh-largest jackpot in the game's history. If you're lucky enough to win, you'll be facing a hefty tax bill.

How much will you owe in taxes?

The amount of taxes you owe on your lottery winnings will depend on a number of factors, including your state of residence and how you choose to receive your winnings.

Federal taxes: The federal government withholds 24% of all lottery winnings over $5,000. This is a mandatory withholding, so you won't have to wait until tax season to pay this tax.
State taxes: In addition to federal taxes, you may also owe state taxes on your lottery winnings. The amount of state tax you owe will depend on your state of residence.
Other taxes: You may also owe other taxes on your lottery winnings, such as estate taxes or gift taxes.
How much will you take home after taxes?

After federal and state taxes, you'll likely take home about half of your winnings. For example, if you win the $725 million jackpot and choose to receive the lump sum payment of $366.2 million, you'll take home about $183.1 million after taxes.

What can you do to minimize your tax bill?

There are a few things you can do to minimize your tax bill on lottery winnings:

Choose the right payment option: If you choose to receive your winnings in installments, you'll spread out the tax liability over time. This can help to reduce your overall tax bill.
Consider donating to charity: You can deduct up to 60% of your adjusted gross income for donations to qualified charities. This can help to reduce your taxable income and lower your tax bill.
Consult with a tax advisor: If you're unsure about how to minimize your tax liability on lottery winnings, you should consult with a tax advisor. They can help you to understand your options and make the best decision for your individual circumstances.