Looking to get really, really rich, quick? You may want to consider purchasing a ticket for Wednesday’s record-breaking Powerball draw, with an estimated US$1.4 billion up for grabs in the American lottery.
In Canadian dollars, that could mean a jackpot total of more than $1.9 billion.
Here’s what Canadians need to know about the jackpot draw…
A non-resident can win Powerball
If you legally purchase a Powerball ticket, then you can collect your prize, regardless of whether you’re an American citizen or not.
Rules around buying Powerball tickets online
According to the lottery’s website, Powerball tickets can only legally be purchased from a licensed retailer. Powerball is played in 44 states, Washington, D.C., Puerto Rico and the U.S. Virgin Islands. A lottery can also legally sell tickets online, but only to “persons within its own state.” The lottery warns against using websites that offer to buy and hold tickets for a service fee.
US Lottery Taxes
So what happens if a Canadian wins? Well they’ll be taxed 5% more than a U.S. winner. Global reports that the federal taxation rate on lottery winnings for non-U.S. residents is 30% of the gross winnings, compared to 25% for American residents. Luckily, lottery winnings are not taxed by the Canadian federal government, so a victor north of the border may still be better off than a U.S. resident (where many states impose additional taxes).