Colorado Lottery Tax Calculator
Enter a prize amount.
Withheld at payout
(24% federal + 4% state)
Check you receive
at claim time
Estimated keep after
ALL taxes at top rates
Estimates assume the top federal bracket (37%) and the top Colorado rate (4.4%) on the full prize, which is close to reality for jackpots and conservative for smaller prizes. Local taxes, deductions, and filing status change the exact number. This is education, not tax advice.
Quick Answer
Quick Answer: How Colorado Taxes Lottery Winnings
The Colorado Lottery withholds 4% state tax on prizes over $5,000 plus 24% federal. Your actual Colorado liability can reach 4.4% at the top bracket, so the withholding is not always the full bill. Federally, large prizes are taxed at up to 37% even though only 24% is withheld up front.
Colorado Lottery Tax Facts
| State withholding on large prizes | 4% (prizes over $5,000) |
| Top state rate you may actually owe | 4.4% (flat) |
| Federal withholding | 24% on prizes over $5,000 |
| Top federal bracket | 37% |
| Claim deadline | 180 days from the draw date |
| Winner anonymity | Not anonymous - first name, last initial, hometown, game, and prize amount released under the Colorado Open Records Act |
| Cash vs annuity election | Jackpot winners have 60 days after ticket validation to elect cash or annuity; Lottery withholds only 4% vs the 4.4% income tax rate, so the difference is owed at filing |
Withholding Is Not the Bill
On any prize over $5,000 the lottery sends 24% straight to the IRS before you see a dollar. A large prize, however, lands mostly in the 37% federal bracket, so the true federal bill runs well past what was withheld. The same gap exists at the state level in Colorado: 4% is withheld, but your liability can reach 4.4% when you file. Winners who spend to the post-withholding number get an ugly surprise in April. Set the difference aside the week you claim.
Claiming Rules That Matter in Colorado
The claim window is 180 days from the draw date. For the cash-versus-annuity decision: jackpot winners have 60 days after ticket validation to elect cash or annuity; Lottery withholds only 4% vs the 4.4% income tax rate, so the difference is owed at filing. Anonymity: not anonymous - first name, last initial, hometown, game, and prize amount released under the Colorado Open Records Act.
Already Collecting Annual Lottery Payments?
If you took the annuity and your plans have changed, you can sell some or all of your remaining installments for a lump sum through a court-approved assignment. The lump sum keeps the same tax character as the payments it replaces, and quotes through this site disclose the exact discount rate in writing. Transactions are funded and completed by our funding partner, Genex Capital, after court approval. Start with the Colorado lottery payments page or request a free quote.