Editing Powerball (section)

===Jackpot accumulation and payment options===
Jackpot winners have the option of receiving their prize in cash (in two installments; one from the winning jurisdiction, then the combined funds from the other members) or as a graduated [[Life annuity|annuity]] paid in 30 yearly installments. The pre-tax amount of the first annuity payment is approximately 1.505% of the jackpot amount. Each annuity payment is 5% higher than in the previous year to adjust for inflation.<ref>{{cite web |url=http://www.powerball.com/powerball/pb_howtoplay.asp |title=Powerball - How To Play |publisher=Powerball.com |access-date=January 12, 2016 |archive-url=https://web.archive.org/web/20160115222858/http://www.powerball.com/powerball/pb_howtoplay.asp |archive-date=January 15, 2016 |url-status=dead |df=mdy-all }}</ref>

The advertised estimated jackpot represents the total payments that would be paid to jackpot winner(s) should they accept the annuity option. This estimate is based on the funds accumulated in the jackpot pool rolled over from prior drawings, expected sales for the next drawing, and market interest rates for the securities that would be used to fund the annuity.<ref name="powerball.com" /> The estimated jackpot usually is 32.5% of the (non–''Power Play'') revenue of each base ($1) play, submitted by game members to accumulate into a prize pool to fund the jackpot. If the jackpot is not won in a particular drawing, the prize pool carries over to the next drawing, accumulating until there is a jackpot winner. This prize pool is the cash that is paid to a jackpot winner if they choose cash. If the winner chooses the annuity, current market rates are used to calculate the graduated payment schedule and the initial installment is paid. The remaining funds in the prize pool are invested to generate the income required to fund the remaining installments. If there are multiple jackpot winners for a drawing, the jackpot prize pool is divided equally for all such plays.

MUSL and its members accept all investment risk and are contractually obligated and liable to the winner to make all scheduled payments to annuity winners. If a jackpot ticket is not claimed, the funds in the prize pool are returned to members in proportion to the amount they contributed to the prize pool. The members have different rules regulating how unclaimed funds are used.<ref name="powerball.com"/>

When the Powerball jackpot is won, the next jackpot is guaranteed to be $20 million (annuity). If a jackpot is not won, the minimum rollover is $10 million. The cash in the jackpot pool is guaranteed to be the current value of the annuity. If revenue from ticket sales falls below expectations, game members must contribute additional funds to the jackpot pool to cover the shortage; the most likely scenario where this can occur is if the jackpot is won in consecutive drawings.

Because of the [[COVID-19 pandemic in the United States]] and resulting drop in ticket sales plus the falling interest rates on which annuity prizes were based, Powerball administrators reduced the minimum starting jackpot to $20 million, and the minimum increase to $2 million when the previous jackpot is not won.<ref>{{cite news |last1=Leggate |first1=Jim |title=Powerball cuts jackpot amounts amid coronavirus sales drop |url=https://www.foxbusiness.com/money/powerball-cuts-jackpot-amounts-amid-coronavirus-sales-drop |access-date=13 April 2020 |publisher=Fox Business |date=2 April 2020}}</ref>