Virginia Lottery's new in-state game awards $1 million, taxes paid

Aug 24, 2015, 8:53 am (21 comments)

Virginia Lottery

$1,000,000 Money Ball game being retired

Wouldn't it be nice if you won some money, and you received a bonus to pay the taxes on your windfall? That's the idea behind the Virginia's Lottery's newest game, Bank a Million.

The top prize in this new draw game is $1 million, but winners of that prize receive something extra.  The top prize amount is calculated so that winners actually receive $1 million after the federal and state tax-withholdings.  In other words, winners get to actually "bank" a million dollars.

In addition to the top $1 million prize there are seven other prize levels awarding payouts from $4 up to $20,000 with a $2 ticket.

The odds of winning the top prize are 1 in 3.8 million. The odds of winning any prize are 1 in 18.3.

Bank a Million has a unique "Play Your Way" feature that allows players to select their wager amount, and the top prize they want to win. All Bank a Million tickets cost two dollars, but players can opt to:

  • Pick one set of six numbers for a chance to win $1,000,000
  • Pick two sets of numbers for a chance to win $500,000
  • Pick four sets of numbers for a chance to win $250,000

To play Bank a Million, players select six numbers from 1 through 40.  The Lottery draws six balls plus one Bonus Ball.  Players can win a prize by matching various combinations of their numbers with the six numbers and Bonus Ball number drawn by the Lottery.  (See the prize chart below.)

The top prize is won when a player matches all six numbers without the help of the Bonus Ball.

Bank a Million tickets will be available at all Virginia Lottery retailers beginning August 30, with the first drawing on September 2. Drawings will be held Wednesdays and Saturdays at 11:00 p.m.  The purchase cut-off time on drawing nights is 10:45 p.m.

Bank a Million winning numbers will be published on Lottery Post's Virginia Lottery Results page shortly after each drawing.

Bank a Million is played exclusively in Virginia.

The game replaces $1,000,000 Money Ball, which ends its year-long run on August 29.  During that time, five Virginia Lottery players have won $1 million in $1,000,000 Money Ball, and an additional 29 won $100,000.

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Lottery Post Staff

Comments

mypiemaster's avatarmypiemaster

You might bank a million, just keep in mind that the extra fluff still counts against you as ordinary income.

jarasan's avatarjarasan

Dang I might be driving over to Ole' Virginny to pick me up some of them bank numbers,  of course, not during rush hour.

Teddi's avatarTeddi

This is a really great idea. Win a million, actually bank a million. Plus the option to play for lesser prizes, which should shut those up who complain about $x being too much money to give to one person. They can actually choose which amount they want to play for. Would be awesome if some of the MUSL games accepted this idea. Imagine winning $100 million and actually banking $100 million like in England.

HoLeeKau's avatarHoLeeKau

Glad to see VA is at least advertising the full prize including the taxes they pay to clue people in that they will owe taxes on that money too. 

Hot Lotto pays 25% of fed tax and I believe all of the state tax, but they advertise (at least in my state) that what you see is what you get because taxes are paid.  Nope, not true.  You'll end up paying the residual 15% fed tax and any state tax on the additional amount that the lottery already paid for you.

Groppo's avatarGroppo

Quote: Originally posted by HoLeeKau on Aug 24, 2015

Glad to see VA is at least advertising the full prize including the taxes they pay to clue people in that they will owe taxes on that money too. 

Hot Lotto pays 25% of fed tax and I believe all of the state tax, but they advertise (at least in my state) that what you see is what you get because taxes are paid.  Nope, not true.  You'll end up paying the residual 15% fed tax and any state tax on the additional amount that the lottery already paid for you.

IF YOU WANT TO SEE WHAT'S GOING ON WITH TAXES AND LOTTO, SEE THE CRAIGSLIST HEADING:

"Maryland Charges Way Too Much Lotto Tax".

I think it explains it well.   It even credits this site USAMEGA as the source for what it talks about.

I don't think it mentions this new Virginia game, though.

savagegoose's avatarsavagegoose

I approve of this lotto

LottoLucy's avatarLottoLucy

Hmmm.  I have been " shunning" VA since they got rid of my beloved Decades of Dollars.  I don't enjoy Cash 4 Life and I hated Money Ball.  This just may entice me back over the border.

LottoLucy's avatarLottoLucy

Quote: Originally posted by Groppo on Aug 24, 2015

IF YOU WANT TO SEE WHAT'S GOING ON WITH TAXES AND LOTTO, SEE THE CRAIGSLIST HEADING:

"Maryland Charges Way Too Much Lotto Tax".

I think it explains it well.   It even credits this site USAMEGA as the source for what it talks about.

I don't think it mentions this new Virginia game, though.

The post has expired on Craig's List.

MeAndMyArrow

Meh. All Lotto winnings should be tax-exempt. The governments already make enough money off them.

Even the People's Republic of California doesn't withhold state taxes from lottery winnings if you're a resident.

maximumfun's avatarmaximumfun

Couldn't PowerBall and MegaMillions also be called "tax free" if they upped the amount initially withheld and only listed the "post tax" amount as the winning jackpot?

maringoman's avatarmaringoman

Quote: Originally posted by MeAndMyArrow on Aug 24, 2015

Meh. All Lotto winnings should be tax-exempt. The governments already make enough money off them.

Even the People's Republic of California doesn't withhold state taxes from lottery winnings if you're a resident.

I Agree! 25% federal withholding is so much taxes that it doesn't make sense to tax jackpots at state level. If California gets that why won't Massachusetts?

MillionsWanted's avatarMillionsWanted

What you win is what you get. Not bad - for lotteries in the United States.

Most state run lotteries in Europe are tax exempt. Neither the lotteries nor players pay taxes for the wins.

rasean75

Quote: Originally posted by LottoLucy on Aug 24, 2015

Hmmm.  I have been " shunning" VA since they got rid of my beloved Decades of Dollars.  I don't enjoy Cash 4 Life and I hated Money Ball.  This just may entice me back over the border.

I'm in the state and agree with you on that. Only reason I stop now is for my pick numbers.

faber98

the 2.00 price tag negates most of the value in this game. better off searching for another state lottery with a 40 or under matrix pik 6 that traditionally charges 1.00 a line and has a jackpot higher than the paltry million. not sneezing at a million mind you but if you shop you can do better.

Artist77's avatarArtist77

Don't get attached to this game. I am sure it will be replaced  in less than a year with something else. Bring back Decades of Dollars.

KY Floyd's avatarKY Floyd

"This is a really great idea. Win a million, actually bank a million."

There's a reason they're calling the game "Bank a Million" instead of "Tax-free Million" or something similar. If you were to win they'd give you an even $1 million dollars, so you really could put a million in the bank, but you won't clear a million after taxes.

The prize is just big enough to cover the required tax withholding, which is 25% for federal taxes and 4% for VA income tax. Since that prize will put you in the top bracket you can expect to pay an additional 14.6% to the IRS and another 1.75% to VA. That's another 16.35% you can expect to owe (less a fairly modest amount since some of it may be taxed at the rates for lower brackets, depending on your other income). That 16.35% will be on the pre-withholding prize of $1,408,451, meaning you should expect to unbank as much as $230,000 sometime after banking the million.

DELotteryPlyr's avatarDELotteryPlyr

Quote: Originally posted by faber98 on Aug 25, 2015

the 2.00 price tag negates most of the value in this game. better off searching for another state lottery with a 40 or under matrix pik 6 that traditionally charges 1.00 a line and has a jackpot higher than the paltry million. not sneezing at a million mind you but if you shop you can do better.

It is nice that there are betting OPTIONS that must add up to $2, that is new to me.  Never seen that before.

HaveABall's avatarHaveABall

Well, KY Floyd, it's all in the WORDING, isn't it!  This game still sounds like a good deal (though I wouldn't play it because the jackpot prizes don't meet my needs).  However, KY Floyd, thanks for breaking down how much is really banked after the remainder taxes are taken out the following year.  Cheers!

Thinking of...

mikeintexas's avatarmikeintexas

Quote: Originally posted by mypiemaster on Aug 24, 2015

You might bank a million, just keep in mind that the extra fluff still counts against you as ordinary income.

I griped about that very thing a yr. or so ago in another thread.  Lottery wins are counted as ordinary income, yet how can the govt. claim a JP win is "ordinary"?  It's really more of a "windfall profits" tax.   I can understand - even if I don't agree with the percentages - taxing the $413, 400 top bracket income (on single filers, it's more for married/filing jointly and head of household) at 39.6% ,  that's income that's most likely fairly consistent- but a multi-million dollar lottery win is a once-in-a-lifetime event.

It's one thing I actually agree on with a certain non-US member in here who constantly harps on anonymity and counselling for lottery winners, as well as lottery winnings being tax-free...which is the thing I agree with.  Even if a JP win was taxed, 39.6% is simply too much for taking the win in a lump sum.   I don't know what's "fair", but 10% sounds perfectly reasonable. 

I forget the exact figures, but I remember calculating that the $230+ million that the elderly Florida resident Gloria MacKenzie paid in federal taxes was just enough to run the govt. for about a half hour.

Scratch$'s avatarScratch$

The FedGov should get no more than 10%, and the states no more than 5%.

realtorjim

Quote: Originally posted by Scratch$ on Sep 7, 2015

The FedGov should get no more than 10%, and the states no more than 5%.

You are forgetting one important aspect... GREED!  The Beatles hit the nail on the head when they sang "And you're working for no one but me TAXMAN".

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