ialottery blog

Tell Me How The Taxes Work On Lottery Prizes

Here’s a question that came our way this week about the withholdings that apply to lottery prizes won in Iowa. The specifics depend on the amount of the prize involved. Here are the details:

The Iowa Lottery doesn’t apply withholdings to prizes of $600 or less. By law, state withholdings of 5 percent apply to lottery prizes of more than $600. And federal withholding of 24 percent applies to prizes of more than $5,000.

All winners of prizes of more than $600 will receive a Federal Form W2-G from the Iowa Lottery. The form shows the prize you won and all taxes withheld. You’ll need to include that form and the details from it when you file your income taxes for the year that you claimed your prize.

Withholdings are designed to cover the taxes owed – some winners may get some of it back, or they may have to pay more, depending on their income level outside of winning a lottery prize.

For prizes won in 2021, the lottery will mail out W2-G Forms to our winners no later than Jan. 31 next year. If you’ve won a prize of more than $600 and you’ve moved since you claimed the prize, be sure to contact us at 515-725-7900 or Wmaster@ialottery.com to provide us with your updated address. That way we’ll mail your W2-G form to the right place.

How Many Big Lottery Prizes Have Been Won In Iowa?

Here’s a question that comes our way and appears to have origins in the urban myth that “no one from here ever wins”: How many big lottery prizes have been won in Iowa?

The first hurdle that likely needs to be cleared is how you define the term “big lottery prize.” For simplicity’s sake, I started out with the threshold of $5 million, and then looked at our winners’ lists to determine how many of those prizes have been won through the years here in Iowa. The answer? Iowa Lottery players have won 25 prizes of at least $5 million.

If that level isn’t considered big enough by someone’s definition, we can jump up to the $10 million level. The answer there: Iowa Lottery players have won 13 prizes of at least that amount.

If you keep going up, lottery players in this state have won five prizes of at least $100 million. And the very largest lottery prize claimed to date in Iowa is a $343.9 million Powerball® jackpot that was won in late 2018.

I know some folks won’t ever truly be satisfied with our “big winner” definitions until their name is on the list, but the specifics I’ve shared here show that Iowans have taken home a lot of significant prizes through the years.

Under state law, the Iowa Lottery winners’ lists are public, so we keep a millionaire’s list on our website that shows all the prizes of at least $1 million won in Iowa as well as a list of all winners of $600 or more within the past 12 months.

Player Question: Why Do Some Numbers Come Up More Often As The Multiplier?

A player recently emailed us with a question about the All Star bonus option in the Lotto America game, and since the same concept applies to the multiplier option in Powerball and Mega Millions, I’ll cover all three of them here.

The player wondered why the number 2 comes up more often as the All Star Bonus in Lotto America. You may already know that the Bonus option can be added to a play in the Lotto America game for an extra $1, and it will multiply any prize you win. The All Star Bonus is similar to the Power Play option in Powerball and the Megaplier option in Mega Millions.   

The answer to the player’s question is found in the game rules, which are available on our website as part of the details for each game.  

The All Star Bonus option can multiply a Lotto America prize (except the jackpot) by 2, 3, 4 or 5. So, for example, if your ticket matches the five white balls in a drawing but misses the Star Ball, you’d win a $20,000 prize. But if you’ve added the All Star Bonus option to your ticket and the Bonus number that night is 3, your prize will be multiplied to $60,000.

In the Powerball game, the Power Play option can multiply prizes (except the jackpot and the Match 5 prize) by 2, 3, 4, 5 or 10 times. And in Mega Millions, the Megaplier option can multiply prizes except the jackpot by 2, 3, 4 or 5 times.

But when it comes to Lotto America specifically, why does the number 2 come up more often as the multiplier? It’s due to the universe of numbers available to be selected as the All Star Bonus. There are 32 numbers in the All Star Bonus pool. Of them, 15 are 2s, 10 are 3s, 4 are 4s, and 3 are 5s. Here is what that looks like in table form:
32 Total Numbers In All Star Bonus Pool
2X = 15
3X = 10
4X = 4
5X = 3

So, does it stand to reason that the All Star Bonus number would come up more often as 2 or 3? Yes. But the other multipliers also have a shot. It’s the same concept for the multipliers in our other big-jackpot games.

Here are the details for the Power Play option in Powerball:
43 Total Numbers In Power Play Pool
2X = 24
3X = 13
4X = 3
5X = 2
10X = 1

And here are the details for the Megaplier option in Mega Millions:
15 Total Numbers In Megaplier Pool
2X = 5
3X = 6
4X = 3
5X = 1

Player Question: What Determines The Jackpot In InstaPlay Progressive Games?

A man reached out to us on Facebook to ask about the jackpot amounts in our Progressive InstaPlay games, and I’m sharing our answer here on the blog in case you’ve wondered the same thing.

The man specifically asked how the jackpot amount is determined in the “Extreme Green Progressive” InstaPlay game, but the process applies to the jackpots in any of our progressive InstaPlay games. They’re called progressive because their jackpots grow progressively larger with each ticket sold statewide until they’re won.

InstaPlay as a product combines features from both lotto games and scratch games. The games have a playstyle similar to that of our scratch games, but InstaPlay tickets are printed and sold on demand from the lottery terminal like those in lotto games. And in the case of our progressive InstaPlay games, they have a starting jackpot amount, just as lotto games like Powerball and Mega Millions have a starting jackpot amount.

In the case of Extreme Green Progressive, its jackpot starts at $20,000 and grows from there, increasing by $2 with each ticket sold statewide in the game.

An electronic file of plays exists in the game, and winning tickets are randomly distributed throughout that file. The exact amount of the jackpot won depends upon where the jackpot-winning ticket exists in the electronic file, and when the ticket is purchased.

Some jackpots won in the game will be larger, based upon where that particular jackpot-winning ticket falls within the game, and some will be smaller, for the same reason. As a security feature, not even those of us who work at the lottery know where the winning tickets are within our games, so no one can predict when or where the next big winner will hit.

The jackpot won in Extreme Green Progressive is therefore a combination of the starting jackpot amount in the game and the number of tickets purchased up until that particular jackpot is won.

The jackpot is clearly not the only prize available in that game. Players also can win prizes in Extreme Green Progressive ranging from $20 up to $10,000, so much of the money spent on tickets in the game goes to pay prizes. A portion of the money from sales in the game also becomes part of the lottery's annual proceeds to state causes. And part of it goes to pay the lottery's expenses for the game, including the costs of the paper on which the tickets are printed.

We'll Mail 2019 Tax Forms To Winners By The End Of This Month

If you claimed an Iowa Lottery prize of more than $600 in calendar year 2019, check your mailbox in the next couple weeks for a form you’ll need as you file your income taxes.

The document is called a W-2G form and it lists the total prize amount as well as any federal and state withholdings from your prize. If you claimed multiple Iowa Lottery prizes of more than $600 in 2019, you’ll receive multiple W-2G forms from us, one for each prize claimed. (And congratulations on your wins, by the way!)

We’re required to mail all W-2G forms by Jan. 31, but we always do our best to have them processed before that date if possible.

In the image here, you can see the envelopes we’ll use to send the tax forms, so check your mailbox for them.

If you think you should have received a W-2G form from us for calendar year 2019 and you've moved since you claimed your prize, please let us know your new address as soon as possible, or your form may end up at your old address. You can contact us at 515-725-7900 or email us at wmaster@ialottery.com.

Be sure to include your name, old address, new address, and phone number in case we need to contact you.

S-M-L-XL: You Don’t Have To Choose

The new scratch games that hit shelves this week here in Iowa include a special series of tickets that may have already caught you eye for how much they look alike. And that’s on purpose.

Through the years, we’ve occasionally released what we call a “Family Of Games,” and the latest are the “9s In A Line” games that just made their debut. There’s 9s In A Line Small, a $1 game; 9s In A Line Medium, a $2 game; 9s In A Line Large, a $5 game; and 9s In A Line XL, a $10 game.

Players have told us that they like the fun of a set of games, and we have fun coming up with concepts and ideas to try.

The top prize available gets larger as you follow the 9s In A Line series up, and so does the playing time on the ticket. For example, the size Small game has just one playing area and offers a top prize of $900, while the size XL game has four playing areas and a top prize of $100,000.

So choose the size you like, or play them all. One size does not have to fit all in this series!

Today’s News: Happy Blasé Day (Or Can We Even Say That?)

Today, if you didn’t know, is National Blasé Day. So basically, it’s okay to be indifferent/unimpressed/bored with anything you’d like.

That’s according to the zany folks at the National Day Calendar, the website that tracks unusual and unique national days and has a day for just about everything.

The calendar points out that the word blasé comes from the French language. We, of course, have many other terms to express the same thing: Meh. Yawner. Bor-ing.

But, just throwing this out there: I’m pretty sure that winning the lottery could overcome even the most hard-core case of blasé. So my question is: What prize amount would make you feel like you’d officially won the lottery?

Some of the people we see smiling the biggest are those who have won $100 to $1,000. The folks who win millions are happy, too, but sometimes they seem pretty stunned as well.

Is there an amount that’s “just right” for you?

P.S. I wish you a very "meh" Blasé Day. :)

Police: Don’t Fall For The Call/Email/Text That You’ve Won A Lottery Jackpot

This central Iowa news coverage is such an important reminder about scams, particularly the fact that they’re on the rise this time of year. As the Nevada police officer says in this interview with WOI-TV, if something seems too good to be true, it is.

Here at the Iowa Lottery, we keep Player Security reminders -- including warnings about lottery scams -- as a permanent feature on the lottery’s website. If you ever have a question about whether something you’re contacted about is legitimate, please check out our reminders, or better yet, contact us in person. We’ll be glad to talk with you and answer any questions you may have.  

Bottom line, remember that if you win a lottery jackpot, we don’t call to let you know that. The process works the opposite way: You as the player with the winning ticket contact us at the lottery to claim the prize.

We have the records showing that a winning ticket has been sold at a particular retail location and the prize amount involved, but we don’t know who the winner is until you present the winning ticket to us at Iowa Lottery headquarters.

Lottery App: The Results Screen For Winning Tickets Is Now Green

We’ve made an update to our lottery app after a player suggestion that we change the results screen that comes up when a winning ticket is scanned.

Back in May, we updated our app so it displays the prize amount when you use it to scan a winning ticket. The results screen for both winning and nonwinning tickets at the time was yellow, but a player reached out and said he thought the screen for winning tickets should be green. (I’m guessing the choice has to do with the color of money, right?)

We did the behind-the-scenes work on the app, and I’m happy to let you know we’ve come through with it: The results screen for winning tickets is now green! It definitely draws a distinction between winning and nonwinning tickets, helping to make it even more obvious when you’ve won a prize!

If you already have our app (it’s called the Iowa Lottery’s LotteryPlus) on your device, there’s nothing you need to do to receive the update. It happens automatically, so you already have the new feature available. If you don’t yet have the app, feel free to install it from the Google Play Store® or Apples iTunes Store® as appropriate for your particular device.

In addition to the details about what you’ve won, you can also use the app to enter tickets into our promotions and learn details about our games and the locations where you can buy lottery tickets in Iowa.

Thank you for playing, and we hope you like the change to our app!

Were You One Of Our 322 Big Winners In September?

We’ve been tracking our big winners all across Iowa for the past nine months in the hopes to give a greater perspective on just how many winners we have all over our great state. Each month’s map represents just how many prizes of $600 or more were claimed.

September brought us 322 more lucky winners of $600 or more, bringing the grand total thus far to 3,375 for the year. On average there are about 375 winning claims filed each month.

Click here for a direct link to this map in an interactive format where you can see the details involved. Each dot shows the retail location where the winning ticket was purchased, the prize won, the game involved, and the date the prize was claimed.

The dots are in different colors for the four types of lottery games here in Iowa: scratch games, lotto games, InstaPlay games and pull-tab games. Scratch tickets have always been the Iowa Lottery’s leading product and they’re represented on the map by red dots, so there are a lot of them!

As always, remember that our maps only show those big prizes that have been claimed. They don’t include those prizes won but not claimed yet.

Did You Notice? Something Unusual Happened In Powerball

Something pretty unusual has happened twice now in Powerball in just the past two weeks. Did you catch it?

Last night’s $80 million jackpot was won with a ticket in New York, but that’s not what I’m talking about. The unusual thing has to do with the Power Play feature in the game.

The 10X was selected as the Power Play multiplier in last night’s drawing and in the drawing a week earlier, on Aug. 28.

Overall, the 10X has been selected as the Power Play number just four times: once in 2017, once in 2018, and now twice so far in 2019.

When you add the Power Play option to your Powerball ticket, it will multiply any prize you win (except the Match 5 prize and the jackpot) by the number selected as the Power Play multiplier in that night’s drawing. A Powerball ticket costs $2 per play, and you can add the Power Play option for an extra $1 per play. 

When the Powerball drawing occurs, the first five numbers and the Powerball are selected by the iconic ball-drawing equipment we’ve all seen through the years, and there is a separate drawing to determine the Power Play number.   

In last night’s drawing, the Power Play number was 10, so the lucky folks who added the Power Play option to their tickets won 10 times the regular amount of their prize!

Here in Iowa, a total of 1,612 plays won prizes last night that were multiplied by 10X. The biggest of them was at the Match 4 level, meaning that the ticket involved matched four of the first five numbers and missed the Powerball. That ticket initially won a $100 prize, but with the Power Play option added, it won $1,000!

It’s relatively unusual for 10X to be selected as the Power Play multiplier because it’s not always available. When the jackpot for the next Powerball drawing is an estimated $150 million or less, a 10X is added to the pool of numbers that can be selected as the Power Play. When the jackpot in the game is more than $150 million, the 10X feature isn’t available, so the multipliers in the pool are 2X-5X.

With the 10X included, there are 43 numbers in the Power Play pool. Of those numbers, 24 are 2s, 13 are 3s, three are 4s, two are 5s, and one is a 10. Here’s what that looks like in table form:

43 Numbers In Power Play Pool
2X = 24
3X = 13
4X = 3
5X = 2
10X = 1

(When the 10X isn’t included, there are 42 numbers in the Power Play pool, and the breakdown of the rest remains the same.)

So, does it stand to reason that the Power Play number will be 2 more often? Yes. But the other multipliers also have a shot. And sometimes the 10X will come up!

Player Mail: Why Aren’t There Expiration Dates On Scratch Tickets?

One of our players recently sent us a question that sparked a really interesting discussion. I’ll share it here on the blog, in case you’ve wondered the same thing: Why aren’t expiration dates printed on lottery scratch tickets?

The woman who emailed us said she’d recently tried to claim a prize from an expired ticket and she was frustrated that she couldn’t still cash it.

In our reply, we explained that there are a lot of factors in when a particular scratch game will end, and the timing of some can’t be predicted. That’s why it isn’t possible to assign a hard and fast end date to a scratch game when the tickets in it are printed.

For example, when the last top prize in one of our scratch games is claimed, we stop sales in it. We don’t want a game on the market if you don’t still have a chance to win a top prize in it! But we don’t know when the last top prize will be claimed -- that all depends on when someone will buy that particular ticket.

Sometimes we have specially-themed games that are only on the market for a short period of time, such as our holiday games. Those games come off the market in January each year because it just wouldn’t make sense if we were selling a game like “Merry Crossword” in July! (We work hard to keep the odds of winning the same in those games as they are in others that are on the market for much longer.)

And at other times, if a game has been on the market for some time and players show us through their (lack of) purchases that they prefer something else, it also will be removed from the shelves. 

We have dozens of games for sale at any one time, but there are only so many bins for tickets in our vending machines and slots for tickets in our dispensers. That means some stores simply don’t have enough room for all the games on the market, and the retail location can then decide which games it wants to sell.

We keep all the details about our games on our website, including game rules, a list of the scratch games currently available in stores, a list of the games where distribution has ended but prizes can still be claimed, and a list of games that have officially ended.  

We’ll keep doing our best to come up with fun, new games to replace those that are ending!

What You’ve Asked For: Our App Now Shows Prize Amount

You’ve been asking about it, and we’re excited to share this update today: Our mobile app now displays the prize amount you’ve won when you scan a winning ticket.

Back in 2017, we debuted our app for both Apple AND Android devices, and like any technology, we’ve updated it over time. The latest update allows the app to display the prize amount involved when you use it to scan a winning ticket.

Before this change, the app showed whether a ticket was a winner or nonwinner, but it didn’t specify the prize amount involved for a winning ticket. And it might seem like a simple change, but making this update took a lot of time, programming and testing. But we’re there now!

If you already have our app (it’s called the Iowa Lottery’s LotteryPlus) on your device, there’s nothing you need to do to receive the update. It happens automatically, so you already have the new feature available. If you don’t yet have the app, feel free to install it from the Google Play Store® or Apples iTunes Store® as appropriate for your particular device.

In addition to the details about what you’ve won, the app also displays where your winning ticket can be redeemed: at a lottery retail location, at a lottery office, or at lottery headquarters only, depending on the prize amount involved.

Our players have been asking for this update and we’re glad to see it go live! It’s a convenience factor for sure, and it’s also another important security feature that allows you to determine the outcome of your lottery tickets on your own. (You also can use a self-checker at a lottery retail location or check our website as other review tools.)