Playing the lottery is a lot of fun and gets quite exciting when you get to the stage of checking your lottery numbers against the results of the tumbling balls. A lot of players are very interested in the way lotteries work such as the way they calculate the jackpots. After all, the jackpot is the one that really piques the interest of the players as we would all like to win that kind of prize money.
So how do they calculate the size of a lottery jackpot? On what does the size of a jackpot depend on? Who decides how big the cash prize will be paid out to a jackpot winner?
Various Ways to Win
The specific rules of the game controls the way a jackpot is calculated and there are certain key factors that will determine how much is paid out such as the way the jackpot will grow bigger at the following draw if nobody wins.
There are other smaller or daily lotteries that have a fixed jackpot which do not roll over and the odds of a win are a lot better. These lottos with a fixed jackpot amount are not as popular as the biggest lotteries though. Players like to see huge multi-million dollar jackpots, which often roll over many times, and they like to challenge themselves to try to win one of these massive prizes.
Pari-mutuel is a French term that means mutual bet and describes the prize distribution method with lotteries such as the EuroMillions lottery where a pool is shared equally among any winners rather than a fixed prize amount. The amount of the jackpot prize is dependent on the amount of tickets sold. The more tickets they sell, the bigger the cash prize will become.
Most lotteries have a guaranteed minimum jackpot which keeps the players interested after a big jackpot has been won. Often there is more than one jackpot winner which means they share the prize equally.
Mega Millions and Powerball Jackpots
The American Mega Millions and Powerball lotteries are probably the most popular lotteries in the world as they are well-known for the massive jackpots they churn out week after week.
Both Mega Millions and Powerball lotteries have a minimum $40 million guaranteed jackpot prize which continues to roll over each week until they are won.
In recent years, both lotteries continually rolled over and broke all jackpot records with the biggest ever jackpot of $1.586 billion with Powerball and $1.537 billion with Mega Millions. These jackpot amounts grew faster and faster as the jackpots got bigger and bigger until they were finally won. They were so popular they hit the headlines worldwide which caused a mad scramble for both the Powerball and Mega Millions lottery tickets at the time, as the jackpot prizes got so massive over many weeks.
There were queues outside the corner shops selling tickets that went all the way down the streets in many towns and villages in the USA. There was an amazing buzz all over the USA and around the world with the online ticket websites.
It gave the ordinary hard working man or woman the opportunity to dream about becoming a billionaire and the possible chance to make it a reality if their numbers matched the tumbling lotto balls. The downside is that in the USA and some other countries you pay tax on your winnings.
Taxation of Lottery Winnings
You have a choice with the Mega Millions and American Powerball lotteries once you have won the jackpot. You can take a lump sum all at once or you can take your winnings as an annuity payment where the prize money is divided into equal payments per year usually over a 20 year period. Needless to say, the most popular option is the lump sum.
There is an upside to taking an annuity as over the allotted time period you earn interest on your winnings which bumps up the final amount significantly. They will also increase your prize as a reward for your patience which is a very good thing if you plan to leave your offspring money in your will.
With EuroMillions, some European countries where you can buy your tickets tax your jackpot winnings and other EuroMillions countries don’t. So it’s probably better to buy lottery tickets online or buy in the non-taxing country so you receive the full amount of your winnings.
The European countries where they tax you on your lottery winnings are Portugal, Spain and Switzerland. You can’t buy your ticket in any of these countries then think you can cash in another non-taxing country as the tickets can only be cashed in the country of purchase.
We have just brushed over the ins and outs of the way lotteries work. You can click on further more detailed information on the website of each specific lottery that you are interested in playing.
We wish you all the luck in the world when playing any of our many online lottery games.
2020 could be your year so get those entries in today!
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