Powerball fever may be over for those of us that did not win, but Christine Romans is minding your business with how lottery winners are taxed. Whether they choose to take it as a lump sum or an annuity, it will be taxed at the highest federal tax rate of 35%. The lump sum still gets you $192.5million before taxes. The winning tickets were found in Arizona and Missouri. After taxes, the winner in Arizona will receive $114 million, while the Missouri winner will get $117.5 million.