Texas Lottery Tax
Texas Lottery texaslottery.com
- Texas tax0%no state tax on prizes
- 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
Texas does not tax lottery prizes, like California, Florida, New Hampshire, South Dakota, Tennessee and Washington. No state income tax. 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 Texas
| Prize | Federal (37%) | Texas (0%) | You keep |
|---|---|---|---|
| $1,000 | −$370 | $0 | $630 |
| $10,000 | −$3,700 | $0 | $6,300 |
| $100,000 | −$37,000 | $0 | $63,000 |
| $1,000,000 | −$370,000 | $0 | $630,000 |
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 Texas
$562 Million jackpot
- Cash value
- $230M
- Federal tax
- −$85.2M
- Texas tax
- $0
- You keep
- $145M
$385 Million jackpot
- Cash value
- $155M
- Federal tax
- −$57.3M
- Texas tax
- $0
- You keep
- $97.5M
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.
- Arizona 2.5%
- Arkansas 3.7%
- California 0%
- Colorado 4.4%
- Connecticut 6.99%
- Delaware 6.6%
- District of Columbia 10.75%
- Florida 0%
- Georgia 4.99%
- Idaho 5.3%
- Illinois 4.95%
- Indiana 2.95%
- Iowa 3.8%
- Kansas 5.58%
- Kentucky 3.5%
- Louisiana 3%
- Maine 9.15%
- Maryland 6.5%
- Massachusetts 9%
- Michigan 4.25%
- Minnesota 9.85%
- Mississippi 4%
- Missouri 4.7%
- Montana 5.65%
- Nebraska 4.55%
- New Hampshire 0%
- New Jersey 10.75%
- New Mexico 5.9%
- New York 10.9%
- North Carolina 3.99%
- North Dakota 2.5%
- Ohio 2.75%
- Oklahoma 4.5%
- Oregon 9.9%
- Pennsylvania 3.07%
- Rhode Island 5.99%
- South Carolina 5.21%
- South Dakota 0%
- Tennessee 0%
- Vermont 8.75%
- Virginia 5.75%
- Washington 0%
- West Virginia 4.58%
- Wisconsin 7.65%
- Wyoming 0%
Rates as of October 13, 2026. taxfoundation.org, IRS. Not tax advice: ask a tax professional before you claim a big prize.