Lottery winnings · Maryland
Maryland lottery tax calculator
Maryland taxes lottery winnings as ordinary income under its graduated schedule — the prize is stacked on your other income, so the rate depends on the total.
Lump sum: enter the cash option, not the advertised jackpot. Annuity: enter one year's payment.
The prize is stacked on top of this. It decides which bracket the winnings land in — and whether the 24% withheld was too much or too little.
What you keep after taxes
28.7% of the prize goes in tax · top federal rate 22.0%
- Prize
- $50,000
- Federal income tax on it
- −$10,350
- Maryland income tax on it
- −$3,984
- You keep
- $35,667
The cheque at claim
- Federal withheld (24.0% — proceeds over $5,000)
- −$12,000
- Maryland withheld (9.5%)
- −$4,750
- Cheque
- $33,250
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At the counter
What is withheld in Maryland
Federal first, everywhere: on proceeds over $5,000 the payer withholds 24% of the whole amount — not the part over the line — and reports it on Form W-2G. That is a prepayment. The tax is settled on your return.
At claim, 9.50% is withheld for Maryland on prizes greater than $5,000 — the state's own words: "Lottery and other gambling winnings in excess of $5,000 are subject to withholding at a rate of 9.50% for Maryland residents or 8.75% for nonresidents."
Worked amounts
Three prizes, cheque and bill
| Prize | Cheque at claim | Federal tax | Maryland tax | You keep |
|---|---|---|---|---|
| $10,000 | $6,650 | −$1,550 | −$795 | $7,655 |
| $100,000 | $66,500 | −$22,114 | −$8,163 | $69,723 |
| $1,000,000 | $665,000 | −$337,180 | −$91,372 | $571,448 |
Single filer with $60,000 of other income for the year.
Questions
How much tax is taken from lottery winnings in Maryland?
Two layers. Federal: the payer withholds 24% on proceeds over $5,000, and the prize is then taxed on your return as ordinary income at the 2026 rates — up to 37%. State: Maryland taxes lottery winnings as ordinary income under its graduated schedule — the prize is stacked on your other income, so the rate depends on the total. At claim, 9.50% is withheld for Maryland on prizes greater than $5,000 — the state's own words: "Lottery and other gambling winnings in excess of $5,000 are subject to withholding at a rate of 9.50% for Maryland residents or 8.75% for nonresidents."
Does Maryland tax lottery winnings?
Maryland taxes lottery winnings as ordinary income under its graduated schedule — the prize is stacked on your other income, so the rate depends on the total.
What will the cheque be on a $100,000 prize in Maryland?
About $66,500 — the prize less $24,000 federal withholding and $9,500 Maryland withholding. The tax actually owed for a single filer earning $60,000 elsewhere is about $30,277, so what you keep is $69,723. Your own figure depends on your other income and filing status.
Is the withholding the same as the tax?
No. Withholding is a prepayment at a flat rate the IRS sets for everyone. The tax is worked out on your return from your total income. If your bracket is above 24% you owe the difference in April; if it is below, the excess comes back as a refund. On a jackpot the gap is large — roughly a third of the federal tax is still owed after the 24% is taken.
Where these figures come from
- IRS Instructions for Forms W-2G and 5754 (Rev. January 2026) — regular gambling withholding, lotteries — read 2026-08-26
- Maryland Employer Withholding Guide (January 2026), page 5 — "Lottery & gambling winnings subject to withholding"; the guide’s own reminders page flags that these rates changed for 2026 — read 2026-08-28
- Maryland Employer Withholding Guide (January 2026) — percentage method, standard deduction $3,400, one exemption $3,200, ten combined local charts — read 2026-08-28
- Comptroller of Maryland, Central Payroll Bureau — "2026 Maryland State and Local Income Tax Withholding Information" (4 Feb. 2026), Attachment 1: local rates for 2026 — read 2026-08-28
Federal tax owed uses the 2026 rate schedules and standard deduction from Form 1040-ES. Maryland tax uses the same rules as our Maryland paycheck calculator. Not modelled: annuity maths, itemised deductions, local income taxes, non-resident rules. Estimates only — not tax advice.
Other states
Or start with the lottery tax calculator to compare the federal cheque, final tax bill and every state from one place.