Lottery jackpots are the top prize in a lottery game. They grow to apparently newsworthy amounts and draw attention from the media. They also drive sales, and can quickly grow to millions or even billions of dollars in value. The prize money is often awarded in a single payment, but in some cases the winner may choose to receive the sum in annual installments. This option requires the winners to create a legal entity with an assigned tax identification number, and simplifies their reporting and distribution of the winnings.

When a jackpot prize hits seven figures the lucky winner will be faced with important decisions, including how to receive the funds. Most lotteries offer winners the choice between a lump sum payout and an annuity payment that spreads payments over 20 or 30 years. The lump sum payout will be less than the advertised jackpot, because taxes and discounts will be deducted. The annuity payments will increase with inflation. The lottery encourages winners to seek financial advice.

The winner must sign the ticket and keep it in a safe place. They will have 180 days to claim their prize. The prize process will take 10-14 business days for Lotto winners and longer for Powerball, Mega Millions and Cash4Life prizes that involve other state lotteries.

Lottery retailers earn a commission on tickets sold, according to the North American Association of State and Provincial Lotteries. They also may receive awards and bonuses for cashing winning tickets. Some states, such as Ohio, use a portion of lottery revenue for education programs. Others, like Kentucky and Indiana, allocate a portion of revenue to senior citizens, tourism and infrastructure.