Powerball Problems
13th January 2016
A lawyer looks at the Powerball.
As Wired magazine lays out here, the maximum number is what you’d get if you took the payout over 30 years. You’re not dumb enough to do that, so you’d take it in cash, giving you just $868 million. Wait, who’s that at the door? Most likely an IRS agent, dressed just like the one also waiting at the back door, so don’t bother trying that. That big bag slung under a helicopter is to take away about 40% of your winnings. The less-well-dressed agents behind them, with a smaller bag under a smaller helicopter, are there to take your state’s cut, unless you had the good sense to move to a state with no income tax before you won the lottery. But you didn’t. Now you’re down to $394 million, barely enough to get you a decent condo in the Bay Area, and according to Wired this brings your expected return on a $2 ticket down below $2. But the more people who play, the more likely it is that the jackpot will be split anyway, and then it just gets worse.