Illinois Lottery Tax

Illinois tax4.95%#21 highest of 38 states
Federal withholding24%on prizes of $5,000 or more
Top federal rate37%owed on a big prize at tax time
IRS form W-2G$2,000+prizes the lottery reports

Illinois counts lottery prizes as income and taxes them at 4.95%. The IRS taxes every prize as income: the lottery withholds 24% from prizes of $5,000 or more, and a big prize puts you in the top bracket (37%), so the rest is due when you file.

What you keep in Illinois

Prize	Federal (37%)	Illinois (4.95%)	You keep
$1,000	−$370	−$49.50	$580.50
$10,000	−$3,700	−$495	$5,805
$100,000	−$37,000	−$4,950	$58,050
$1,000,000	−$370,000	−$49,500	$580,500

Estimate at the top federal rate. Smaller prizes are taxed at your own bracket, so you may owe less; city or county taxes are not included unless the note above says so.

If you win the jackpot in Illinois

$562 Million jackpot

Cash value: $230M
Federal tax: −$85.2M
Illinois tax: −$11.4M
You keep: $134M

Cash or annuity: Powerball payout calculator

$403 Million jackpot

Cash value: $162M
Federal tax: −$60M
Illinois tax: −$8M
You keep: $94.1M

Cash or annuity: Mega Millions payout calculator

Lottery tax by state

38 states tax lottery prizes, from 2.5% to 10.9%. 8 do not: California, Florida, New Hampshire, South Dakota, Tennessee, Texas, Washington and Wyoming.

Rates as of October 13, 2026. tax.illinois.gov, IRS. Not tax advice: ask a tax professional before you claim a big prize.