Guide
Won the Lottery in Another State?
Two states can claim the same prize: the one that sold the ticket, because the prize was won there, and the one you live in, because it taxes all of its residents’ income. A credit usually keeps you from paying the full rate twice — but not always.
Published and verified · Jackpot Tax Calc Editorial Team
The three steps
- The selling state withholds. Its lottery applies its own withholding rule to you as a nonresident. Connecticut, Michigan, Illinois and Colorado say outright that their rate applies regardless of residency; Maryland withholds 8.75% from nonresidents instead of 9.5%.
- The selling state may tax the prize. A lottery prize is generally income from sources in the state that ran the drawing. You file a nonresident return there. Kansas, for example, taxes a nonresident on all income at Kansas rates and multiplies by the Kansas share; Wisconsin prorates by the ratio of Wisconsin income to federal AGI.
- Your home state taxes everything, then credits. Your resident return includes the prize. Most states then allow a credit for tax paid to the other state on the same income, limited to the home state’s own tax on it. You end up paying the higher of the two rates, split between the states.
Exceptions that change the answer
- The District of Columbia cannot tax nonresidents — the Home Rule Act forbids it — so a Maryland or Virginia resident who wins a DC Lottery prize pays only the home state.
- California exempts every California Lottery prize, including those won by nonresidents; a Nevadan or Arizonan with a California ticket owes California nothing.
- No-income-tax home states give no credit, because there is nothing to credit against: a Texan who wins in Oklahoma bears Oklahoma’s tax in full.
- No-income-tax selling states withhold nothing: a Massachusetts resident who wins in New Hampshire owes the whole Massachusetts tax at filing.
- New Jersey’s $10,000 exemption applies to New Jersey Lottery prizes; it does not exempt a New Jerseyan’s prize from another state’s lottery.
Seven $1 million examples
Single filer, no other income, 2026 rules. Where we could not confirm from a primary source how the selling state taxes nonresidents, the calculator assumes the prize is taxed there as in-state income and flags it.
| Live in → bought in | Selling-state tax | Home-state tax after credit | Kept after all tax |
|---|---|---|---|
| New York → Connecticut | $69,850 | $0 | $610,150 |
| New Jersey → New York | $68,500 | $6,074 | $605,426 |
| Texas → Oklahoma | $44,785 | $0 | $635,215 |
| Maryland → District of Columbia | $0 | $58,385 | $621,615 |
| Nevada → California | $0 | $0 | $680,000 |
| Utah → Idaho | $52,745 | $0 | $627,255 |
| Massachusetts → New Hampshire | $0 | $50,000 | $630,000 |
The calculator’s “Ticket bought in” selector does this for any pair. It computes the selling state’s tax on the prize alone, which matches a source-only method exactly and comes close to the ratio method several states use when the prize is most of the year’s income.