New Jersey Lottery
New Jersey Lottery Tax Calculator
New Jersey exempts New Jersey Lottery prizes of $10,000 or less, taxes larger ones at up to 10.75%, and withholds 5% on prizes up to $500,000 and 8% above that.
Verified · tax year 2026
New Jersey prize — results
Take-home
62.7% kept of $750,000
Annuity · 30 payments
Year 1 — → year 30 —
| Cash received | $750,000 |
|---|---|
| Federal income tax | −$227,500 |
| Tax to New Jersey | $0 |
| New Jersey tax | −$52,149 |
| Local income tax | $0 |
| You keep | $470,351 |
| Federal withholding (24%) | −$180,000 |
|---|---|
| State withholding | −$60,000 |
| Check you receive | $510,000 |
| Still owed when you file | $39,649 |
Data: IRS Rev. Proc. 2025-32 · state agencies, verified · what this leaves out
The $10,000 line and the $500,000 line
New Jersey’s income tax instructions list New Jersey Lottery winnings from prizes of $10,000 or less as exempt — including Mega Millions and Powerball prizes won through New Jersey. Above $10,000 the whole prize is taxable. Withholding has two tiers: 5% on prizes over $10,000 up to $500,000, and 8% on prizes above $500,000. A $750,000 prize therefore has $60,000 withheld, against $52,149 of New Jersey tax for a single filer with no other income.
Casinos get no exemption
The $10,000 exemption is for the Lottery only; Atlantic City casino and racetrack winnings are fully taxable. At the top, income above $1,000,000 is taxed at 10.75% for every filing status, so on a $5,000,000 prize the 8% withholding ($400,000) falls short of the $504,574 New Jersey bill. Married couples and heads of household use the wider Table B brackets, which include a 2.45% step that single filers do not get.
New Jersey at a glance
| State income tax on winnings | Up to 10.75% |
|---|---|
| Rate table used | Tax years 2020 and after |
| Lottery | New Jersey Lottery |
| State withholding at claim | 5% ($10,001–$500,000) · 8% (over $500,000) |
What New Jersey winners should know
- New Jersey Lottery prizes of $10,000 or less — including Powerball and Mega Millions prizes won through New Jersey — are exempt from New Jersey income tax.
- Withholding jumps from 5% to 8% once a prize passes $500,000, but the 10.75% top rate on income over $1 million means a jackpot still owes more at filing.
- Casino and racetrack winnings get no $10,000 exemption in New Jersey.
New Jersey sources
- New Jersey Tax Rate Schedules (2020 and after) — NJ Division of Taxation
- Claim a Prize / Tax Requirements — New Jersey Lottery †
- 2025 Form NJ-1040 instructions — NJ Division of Taxation
Agency: NJ Division of Taxation. † read through a browser session (why). How the math works.