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How are Mega Millions paid out in California?

The Mega Millions lottery is one of the two major multi-state lottery games in the United States, along with Powerball. Mega Millions is played in 45 states, including California, as well as Washington D.C. and the U.S. Virgin Islands. The game has produced some of the largest lottery jackpots in U.S. history, with the current record being a $1.537 billion jackpot won in South Carolina in 2018.

Mega Millions Game Overview

Mega Millions is drawn twice a week, on Tuesdays and Fridays, at 11 p.m. Eastern Time. To play, players pick six numbers: five main numbers between 1 and 70, and one Mega Ball number between 1 and 25. The cost is $2 per play. There are nine prize tiers in Mega Millions, ranging from $2 for matching just the Mega Ball up to the game’s jackpot for matching all six numbers.

The minimum Mega Millions jackpot is $40 million. If nobody wins the jackpot in a given drawing, the prize money rolls over into the next drawing, increasing the jackpot for the next draw. Jackpots start at $40 million, grow by at least $5 million each draw, and can roll over for months before someone wins. The odds of winning the Mega Millions jackpot are about 1 in 302 million.

How the Jackpot Grows

The Mega Millions jackpot grows over multiple draws based on game sales and rolls. When the jackpot is won, the prize pool resets to the minimum $40 million amount for the next draw. If no players match all six numbers, the jackpot rolls over and increases for the next drawing. The rate at which the jackpot increases varies depending on game participation and sales across all participating states.

In every Mega Millions drawing, a set percentage of sales is allocated to each of the prize tiers. Here is how each prize pool is funded in every draw:

Prize Pool Allocation
Match 5+Mega Ball (Jackpot) 75.30%
Match 5 7.50%
Match 4+Mega Ball 1.67%
Match 4 1.62%
Match 3+Mega Ball 1.07%
Match 3 1.29%
Match 2+Mega Ball 0.65%
Match 1+Mega Ball 4.35%
Match 0+Mega Ball 6.55%

The jackpot prize pool starts at $40 million and keeps growing by at least $5 million per rollover until someone wins. The other tier prize pools stay fixed, with the amount of the prizes determined by dividing the allocated percentage for that tier by the number of winners. The more winners at each tier, the smaller each individual prize becomes.

Mega Millions Sales in California

In California, Mega Millions sales open at 6:00 a.m. PT on draw days and close at 7:45 p.m. PT that night. Tickets can be purchased at over 21,000 lottery retail locations across the state. Sales are also available online through the California Lottery website and official mobile app.

California joined Mega Millions in June 2005, shortly after the game expanded to become a multi-state offering. In fiscal year 2021-2022, Californians spent approximately $195 million on Mega Millions tickets, accounting for about 10% of total Mega Millions sales across all participating jurisdictions.

When the jackpot climbs particularly high, sales in California and across the country surge along with the increasing prize. For example, in July 2022 when the jackpot reached $1.02 billion, more than $116 million in Mega Millions tickets were sold in California alone.

How California Mega Millions Winnings are Taxed

California taxes lottery winnings differently depending on how large the prize is:

  • Prizes under $600 are not taxed.
  • Prizes between $600 and $14,999 are taxed at the state income tax rate, which ranges from 1% to 13.3% based on income brackets.
  • Prizes of $15,000 or more are taxed at the highest state marginal income tax rate, which is currently 13.3%.

California does not allow lottery winners to remain anonymous. However, winnings from tickets purchased online can be claimed through a trust to provide some privacy.

For multi-state games like Mega Millions, California taxes its residents who play and win in California. Winners from other states pay taxes based on their own state’s tax laws.

How Mega Millions Jackpots are Paid Out

Mega Millions gives players two options when claiming substantial prizes:

  • Cash option – A one-time, lump-sum payment that is equal to the cash in the jackpot prize pool. The cash value is typically estimated to be about 70% of the advertised jackpot amount.
  • Annuity option – The full jackpot prize paid out over 29 years in 30 graduated payments. Each payment is 5% higher than the previous one to account for inflation.

Most jackpot winners take the cash option. The annuity option pays out more overall, but reduces risks associated with managing large sums of money.

For either the cash or annuity option, California state income taxes are withheld from each payment. Federal income taxes of at least 24% are also withheld from payments.

Cash Option

If the winner selects the cash option, they receive a one-time, lump-sum payment of all the cash in the prize pool. If the jackpot amount is advertised as $400 million, the cash value might be around $280 million before taxes.

California automatically withholds state taxes of between 13.3% and 5% depending on the winner’s total taxable income. Federal taxes of at least 24% are also withheld. Finally, the winner is responsible for paying any additional federal or state taxes owed at the end of the tax year.

Annuity Option

If the winner chooses the annuity option, the full advertised jackpot amount is paid out over 29 years. The initial payment is made right away, with subsequent graduated payments made annually around the anniversary date of the win.

Each payment is 5% larger than the previous one. For example, if the jackpot amount is $500 million, the annual payments would increase as follows:

Payment # Payment Amount
1 $16,666,667
2 $17,500,000
3 $18,375,000
30 $33,913,793

California state taxes between 13.3% and 5% are withheld from each payment depending on the winner’s total taxable income. At least 24% in federal taxes are withheld as well. As with the cash option, additional taxes may need to be paid at the end of each tax year if not enough was withheld initially.

Mega Millions Jackpot Winners in California

Since Mega Millions began in 2005, there have been several notable jackpot wins in California:

  • In December 2013, two winning tickets split a $636 million jackpot, worth $318 million each. One ticket was purchased in San Jose and the other in Atlanta.
  • In July 2015, a $20 million prize was won in the Central Valley community of Hilmar.
  • In January 2021, a $426 million ticket was sold at a Chevron station in Woodland Hills. The winner opted for the lump sum of $292.9 million before taxes.
  • In July 2022, 20 tickets in California matched the first five numbers to win $24,000 each during a run-up to a record $1.34 billion jackpot.

At least one California resident has also won a secondary prize of $1 million or more in most years that Mega Millions has been offered in the state.

Unclaimed Mega Millions Jackpots

Mega Millions winners have between 180 days and one year to come forward and claim their prize, depending on the rules in their home state. In California, winners have one year from the date of the draw to submit a claim.

If a jackpot winning ticket in California goes unclaimed, the money remains in the prize pool for future drawings. Unclaimed funds are distributed proportionally across each prize tier in line with the game’s standard payout structure.

While no one has ever failed to collect a Mega Millions jackpot, there have been several instances of smaller prizes going unclaimed:

  • In August 2015, a $1 million winning ticket was sold in Palmdale but never claimed. The money ultimately went back into the prize pool for future drawings.
  • In August 2018, two $4 million winning tickets were sold in San Francisco and Santa Rosa but never redeemed.
  • Between 2005 and 2018, more than $224 million in California Mega Millions prizes went unclaimed overall.

Lottery officials frequently urge players to check their tickets carefully so they do not miss out on any potential prizes.

Odds of Winning

The odds of winning any Mega Millions prize are about 1 in 24. The odds for each prize tier are as follows:

Prize Level Odds of Winning
Jackpot 1 in 302,575,350
Match 5 1 in 12,607,306
Match 4+Mega Ball 1 in 931,001
Match 4 1 in 38,792
Match 3+Mega Ball 1 in 14,547
Match 3 1 in 606
Match 2+Mega Ball 1 in 693
Match 1+Mega Ball 1 in 89
Match 0+Mega Ball 1 in 37

A player is about 350 times more likely to be struck by lightning than to win the Mega Millions jackpot. However, their odds improve significantly if they buy multiple tickets for the same draw.

Strategies for Winning

The random nature of Mega Millions drawings means there is no guaranteed strategy to win the jackpot. However, there are some tactics players use to try increasing their odds:

  • Buy multiple tickets – More tickets equals more number combinations covered.
  • Join an office pool – Combining money with others improves ticket-buying power.
  • Mix up numbers – Avoid only using birthdays or patterns to randomize picks.
  • Consider Quick Picks – Letting the computer generate random numbers mixes things up.
  • Check your tickets – Make sure you don’t miss any smaller prize wins.

In the end, a major factor is simply luck. But regularly playing Mega Millions with different number sets can improve your chances versus playing infrequently.

Changes for Mega Millions

Mega Millions has made several changes over the years that altered the game’s odds and prizes:

  • 2010: Starting jackpot raised to $12 million.
  • 2013: Second prize tier for matching first 5 added.
  • 2017: Odds lowered and starting jackpot raised to $40 million.
  • 2017: Megaplier option added to multiply non-jackpot prizes.
  • 2022: Third weekly drawing added on Mondays.

These changes increased the game’s overall difficulty but produced larger jackpots more frequently. California and other states approved the adjustments to spark higher sales and bigger prizes for players.


Winning the Mega Millions jackpot requires immense luck, but players in California have just as much chance as anyone to match all six numbers. Jackpot winners in the state have two payment options and must pay significant state and federal taxes on their windfall.

To hit the jackpot, players should buy tickets regularly whenever the top prize grows sufficiently large. While there is no guaranteed path to matching all six numbers, using different number combinations every draw can help increase your odds.

Dreaming of multi-million dollar winnings is fun, but responsible players should only spend discretionary income on Mega Millions tickets. As long as you play strictly for entertainment and not investment purposes, Mega Millions can be an exciting addition to your weekly routine!