Did the $2 Billion Powerball Winner Really Get Only $628 Million? What the Edwin Castro Case Shows About Lottery Jackpots
Did the $2 Billion Powerball Winner Really Get Only $628 Million? What Actually Happened in the Edwin Castro Case
Edwin Castro of Altadena, California was officially named in February 2023 as the winner of the record-breaking $2.04 billion Powerball jackpot from the November 7, 2022 drawing. Public filings and lottery statements confirm that while the jackpot was advertised at $2.04 billion, Castro chose a lump-sum cash option of about $997.6 million before federal taxes, leaving him with an estimated $628 million after taxes—a discrepancy that has fueled viral claims and confusion online about what he “really” received.
This article examines whether the claim is true, explains how U.S. lottery jackpots are calculated, and outlines the competing narratives around Castro’s win, drawing on statements from the California Lottery, tax experts, court filings, and major U.S. news outlets.
Who Is Edwin Castro and What Was the $2.04 Billion Powerball Jackpot?
According to the California Lottery and coverage by outlets such as the Los Angeles Times and NBC News , Edwin Castro purchased the winning Powerball ticket at Joe’s Service Center in Altadena, California, for the drawing held on November 7, 2022.
- The advertised jackpot: $2.04 billion (the largest Powerball jackpot to date).
- The winning ticket: matched all six numbers drawn.
- Location: Altadena, in Los Angeles County, California.
- Winner announcement: Castro was named publicly in February 2023 by the California Lottery.
California law requires the lottery to release the winner’s name and the amount won, but Castro has not spoken extensively to the media. Instead, most information about his prize has come from lottery officials, tax calculations, and later court documents related to a separate ticket ownership dispute.
Is It True He “Only Got” $628 Million Out of $2 Billion?
Based on publicly reported figures and U.S. federal tax rules, the widely repeated number—about $628 million—is a reasonable estimate of Castro’s after-tax proceeds, and it is consistent with how large American lottery jackpots are paid out.
The California Lottery announced that the cash value of the jackpot—the lump-sum option—was approximately $997.6 million. Independent tax calculations by personal finance outlets such as CNBC and Forbes estimated that, after U.S. federal income taxes, the take-home amount would be in the neighborhood of $625 million to $630 million.
That means the statement that he “only got $628 million” is broadly accurate in a numerical sense, but it can be misleading without explaining how the original $2.04 billion jackpot is calculated.
How a $2.04 Billion Jackpot Becomes About $628 Million: Annuity vs. Cash and Taxes
Powerball jackpots are advertised using an annuity value, not the immediate cash in the prize pool. The Edwin Castro case illustrates three separate steps: annuity calculation, lump-sum choice, and tax withholding.
1. Annuity value versus cash value
The $2.04 billion figure represented what the jackpot would pay if taken as a 30-year annuity, with an initial payment followed by increasing annual payments financed by government bonds. According to the official multi-state lottery rules, this advertised amount is higher than the cash collected from ticket sales because it includes projected investment earnings over three decades.
The Multi-State Lottery Association explains that the “cash value” is the amount in the jackpot pool at the time of the drawing, while the “annuity value” assumes that cash is invested to generate the full advertised amount over time.
2. Choosing the lump sum (cash option)
Castro, like most large-jackpot winners, chose the single lump-sum cash payment. The California Lottery stated this cash value was about $997.6 million. That choice immediately reduced the headline amount by roughly half, because he elected to receive the underlying cash today rather than payments plus future interest over 30 years.
3. Federal income taxes
Lottery winnings in the United States are treated as taxable income for federal purposes. For very large jackpots, most of the payout is subject to the top federal marginal rate. In 2022–2023, this top rate was 37 percent.
- Initial withholding on large lottery winnings is typically 24 percent.
- Additional tax is usually due when the winner files a federal return, bringing the effective rate closer to 37 percent on the bulk of the prize.
Various tax analysts estimated that approximately $360 million to $375 million of the $997.6 million lump sum would go to federal income tax, leaving around $620 million to $635 million net.
California, unlike many U.S. states, does not tax lottery winnings, which meant Castro faced no additional state income tax on the prize, according to the California Franchise Tax Board’s published rules.
Combining these steps, the rough path from $2.04 billion to about $628 million is:
- $2.04 billion (30-year annuity figure advertised to the public).
- ≈$997.6 million (lump-sum cash value Castro chose).
- ≈$628 million (estimated remaining amount after federal taxes).
Viral Claims, Lawsuits, and Public Skepticism
The gap between the advertised $2.04 billion jackpot and Castro’s estimated $628 million take-home amount has fueled misinformation and speculation on social media, including claims that the money was “stolen,” that “most of it went to the government,” or that the jackpot was somehow fraudulent.
Competing narratives and a ticket dispute
Separate from tax questions, a high-profile civil lawsuit was filed in Los Angeles County in 2023 by a man named Jose Rivera, who alleged that the winning ticket had been stolen from him before the drawing. The lawsuit named Castro, the person Rivera accused of taking the ticket, and the California Lottery. Coverage by CNN and other outlets outlined Rivera’s claims.
The California Lottery has consistently stated that it followed its standard validation process and that it is confident Castro is the legitimate winner. As of early 2025, no court had found evidence that would overturn Castro’s ownership of the ticket, and the lottery has continued to treat him as the lawful recipient of the jackpot. The civil complaint has nevertheless kept public doubts alive in some corners of social media.
Public perceptions of fairness
Critics of the lottery system use the Castro case to argue that jackpot advertising can be misleading, because consumers often assume the headline figure is equivalent to a single cash payment. Some tax skeptics also argue that the level of federal taxation on gambling wins is too high.
Others point out that rules about annuity values, cash options, and taxes are disclosed in official lottery materials and are consistent across major U.S. lotteries. From this perspective, the outcome in Castro’s case is viewed as a standard application of existing law rather than a special or unfair treatment.
Expert Perspectives: Are Lottery Jackpots Misleading?
Economists, tax professionals, and consumer advocates offer differing views on whether cases like Castro’s show that lottery advertising or tax policy should change.
Critiques of current practice
- Advertising emphasis on the annuity figure: Some consumer advocates argue that highlighting “$2.04 billion” without equal prominence to the after-tax cash amount can create unrealistic expectations for players.
- Complexity of tax outcomes: Personal finance writers note that many winners underestimate how much they will owe in federal taxes, sometimes leading to confusion when the final amount is much lower than the advertised jackpot.
- Behavioral impact: Behavioral economists have suggested that giant headline jackpots can encourage people to overestimate their chances of winning, potentially affecting lower-income players disproportionately.
Defenses of the current system
- Transparency of rules: Lottery officials point out that the distinction between annuity and cash options is published in game rules, and players are not required to choose an option until after winning.
- Standard tax treatment: Tax experts emphasize that lottery winnings are treated similarly to other forms of high income under federal law, and that large jackpots receiving heavy taxation is consistent with a progressive income tax system.
- Public-benefit framing: State lotteries often stress that a portion of lottery revenue supports public programs such as education, framing heavy taxation and retained funds as a source of public funding rather than pure loss.
What the Edwin Castro Case Means for Future Lottery Winners
For potential lottery players or future winners, the Castro case underscores several practical points about large jackpots and personal finance:
- The advertised jackpot is usually a 30-year annuity value, not the immediate cash you would receive.
- Choosing between annuity and lump sum involves a trade-off between a smaller payment now and potentially larger total payments over time.
- Federal income taxes can reduce the lump-sum cash value by more than one-third, and some states also tax lottery winnings, though California does not.
- Legal disputes or claims of ticket ownership, while relatively rare, can arise and may prolong public scrutiny of the winner’s identity and finances.
- Financial planners often recommend that large jackpot winners consult legal, tax, and investment professionals immediately to manage sudden wealth.
Conclusion: A Record Jackpot, a Standard Payout Structure
Edwin Castro’s $2.04 billion Powerball win remains the largest advertised lottery jackpot in history, and available evidence indicates that his reported post-tax proceeds of roughly $628 million align with established Powerball rules and U.S. tax law. The apparent gap between “$2 billion” and “$628 million” reflects the difference between a long-term annuity and an immediate cash payout, followed by federal income taxation, rather than missing funds or an extraordinary penalty.
While debates continue over how lotteries are marketed, how fairly they tax winners, and how such games affect consumers, the financial path from headline jackpot to take-home cash in the Castro case appears to follow the same structure that governs all major U.S. lottery prizes.
Readers seeking more detail on jackpot structures and tax treatment can consult official resources such as the Powerball website, the California Lottery, and guidance from the Internal Revenue Service on the taxation of gambling income.
