Does Alabama Have a Lottery?

Why Doesn't Alabama Have a Lottery?

Alabama has made numerous attempts to establish a state lottery over the decades, but religious and political opposition has repeatedly defeated these efforts. A 1999 referendum on a state lottery failed by a wide margin, driven in large part by organized opposition from evangelical Christian groups who view gambling as morally objectionable. The Alabama Citizens Action Program (ALCAP) and similar organizations have long lobbied against legalized gambling. More recent legislative proposals have also stalled, leaving Alabama as one of a small handful of states still without any lottery.

Can You Play Powerball or Mega Millions in Alabama?

Alabama does not sell Powerball or Mega Millions tickets. No lottery retailers operate in the state. However, Alabama residents can legally purchase lottery tickets when visiting neighboring states — Georgia, Tennessee, Florida, and Mississippi all sell Powerball and Mega Millions tickets. You must buy the ticket in person in the other state; online cross-state purchases are not permitted.

Lottery Tax in Alabama

Alabama has a state income tax with rates ranging from 2% to 5%. If an Alabama resident wins a lottery prize from a ticket purchased in another state, that income is taxable in Alabama as ordinary income. Alabama does not have a specific lottery tax withholding, but residents are required to report out-of-state gambling winnings on their Alabama state tax return.

Federal taxes of 24% are withheld on prizes over $5,000 regardless of which state sold the ticket.

Nearest States Where You Can Buy Lottery Tickets

Alabama residents must purchase lottery tickets in person in a neighboring state. Here are the closest options: