With a $1.6 billion Mega Millions lottery jackpot, North Dakota stand to score big if a winning ticket belongs to a resident.
Ryan Koppy, sales and marketing manager for the state lottery, said the state taxes lottery winnings at 2.9 percent. If the winner lives in North Dakota, he or she will pay about $43 million in state taxes. In Minnesota, the 7.25 percent tax rate would add up to around $116 million.
The winner will end up handing over about $384 million to the federal government for a 24 percent tax rate.
Koppy said the $1.6 billion jackpot is a world-record high and only the second time a lottery jackpot has reached over $1 billion. A 2017 financial statement from the North Dakota state lottery said sales during fiscal year 2016 were 22 percent higher than 2017 in part because of the Powerball jackpot that reached $1.5 billion that January.
Several states have no additional taxation on lottery winnings, but North Dakota has the lowest tax percentage among states that do charge winnings with state taxes, according to data from USA Mega, a site that provides lottery alerts and information. New York has the highest tax at 8.8 percent and residents of New York City face another 3.8 percent extra in taxes.
North Dakota sold more than $27 million in lottery tickets during 2017. Koppy said the profits go into the state's general fund.
While there are plenty of North Dakotans buying tickets and dreaming of what they'd do with $1.6 billion, the odds are slim. Chances of winning the jackpot are one in 302,575,350, according to the Mega Millions website. The largest win North Dakota has seen is a $3 million ticket during 2016.