The Powerball jackpot jumped to $1 billion after a drawing Monday failed to produce a winner. According to Powerball, this lottery is one of the top 10 biggest jackpots in Powerball history.

The next drawing will be held on Wednesday night and here's what you need to know about the payouts if you draw winning numbers.

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The payout options are similar to the Mega Millions, Powerball’s rival lottery game. Winners can choose to receive their payment as an annuity or a lump sum.

Lump sum

The lump sum option is a one-time payment of the entire jackpot amount, although the IRS will take a large cut if you win, requiring a mandatory 24% withholding for funds over $5,000. State taxes taken out will depend on where you live.

With the Powerball jackpot at $1 billion, winners who elect for a lump sum cash option will take home $516.8 million currently.

Electing to receive all your winnings at once will result in bringing home less cash overall because payments increase over time and the sudden expansion of your bank account will likely move you into a higher tax bracket.

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Annuity

For those who select the annuity option, winners will receive a one-time payout followed by a series of distributed payouts, typically over a 30-year time period. With the annuity options, victors will pay taxes as they go and rates can fluctuate over the years.

While tax rates on payments will fluctuate, the bite won't be quite as sharp with payments made over 30 years compared to losing almost half your winnings before they make their way into your bank account.

Powerball ticket sales are set to close at 10 p.m. EST on the day of drawings which are Monday, Wednesday, and Saturday.