The taxes are far less on a yearly basis, but over the course of the annuity you’ll actually pay a lot more in taxes. Rough calculation, if I won this jackpot it would break down to:
Lump sum: Immediate payment of $478.2M with a tax bill of around $210M for my state and Federal income taxes. Net payout of $267.8M.
Annuity: $1.04B paid over 30 years. At current tax rates that’s a bill of $456.5M over that 30 years. Net payout of around $583.5M. If tax rates change during the term of the annuity those could rise or fall a bit.
Not like I’ll ever have to worry about the problem,but I think I would take the annuity because I’ve never had to manage a large amount of money, and it more gently eases you into it while giving some buffer to assure you don’t somehow blow through everything quickly.