Who's guaranteed to win the lottery? The state; these have raked in the most cash

Earlier this year the seemingly impossible happened to a man in Portland, Oregon: he won the fourth largest Powerball jackpot set at $1.3 billion. Lottery winner, Cheng “Charlie” Saephan split the cash prize with his wife and friend, taking home a collective $422 million.

It's a universal fantasy to win the lottery. If you ask a stranger how they'd spend their Mega Millions jackpot winnings, you'll likely hear "pay off debts," "buy property," or "retire." Sometimes we're optimistic enough to believe it could happen to us (you're more likely to get killed in a shark attack or be struck by lightning). Even if your pay day never comes, there is one consistent lottery winner: state governments.

About a third of each lottery jackpot is allocated to state governments. During fiscal year 2023, U.S. lottery sales totaled over $113.3 billion, according to the North American Association of State and Provincial Lotteries (NASPL). That means state governments walked away with an estimated $37 billion.

The Washington Post reported that in 2022 states got $28 billion from lottery sales. While it sounds impressive, the Post said that amount is equivalent to less than 2% of total state tax revenue.

For every lottery dollar collected, no more than 40% of it is going to the state, Vox reported last year. The news outlet described it as a "drop in the bucket" for state government funds.

Which states make the most money from lottery sales?

Washington, DC, Puerto Rico, the U.S. Virgin Islands and 45 states have locally-run lotteries, with differing systems depending on the state.

In 2022, lottery sales amounted to about $375 per U.S. adult 18 and older, according to the U.S. Census Bureau’s annual survey of state government finances.

States in New England and along the South Atlantic had the largest annual state lottery ticket sales per adult. Massachusetts topped the list with $1,037 spent on tickets per adult. Rhode Island followed with $627 sales generated per person.

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How is lottery money distributed?

First, states must pay out prize money and cover operating/ advertising costs. Once this money is allocated, states get to keep the remaining funds, according NASPL.

For many states, profits from the lottery are combined with taxes and other revenue sources and piled into a general government fund. In other situations, lottery proceeds are dedicated to a variety of causes, such as education, veteran affairs, economic development and environmental issues, NASPL wrote.

In 2022, South Dakota distributed the most lottery income to its government programs. More than 75% of lottery income goes to South Dakota's government revenue. About 18% was allocated to prize payouts.

Idaho and Virginia allocated about 75% of their lottery income to prize payouts. About 21% of lottery income went towards state revenue.

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How often do Americans play the lottery?

About half of all Americans buy a lottery ticket at least once a year. Often times, those players buy a lottery ticket when the Powerball or Mega Millions Jackpot grows to be worth hundreds of millions or billions.

The group of people that are disproportionately funding the lottery are the weekly and daily players. One in eight Americans buy a lottery ticket on a weekly basis.

In general, men play the lottery more often than women on a daily, weekly and monthly basis, according to data from YouGov.

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