Powerball fever has regular people, non-profits dreaming of big payday

SAN JOSE, Calif. - Powerball fever has gripped the country and Bay Area. Due to several weeks of misses, Wednesday’s jackpot drawing sits at $1.2 billion.

A steady stream of would-be billionaires came and went all day at Ernie’s Liquors in East San Jose. But one person in particular hoped a local beats the odds and wins big.

Trish Garcia is busy readying Martha’s Kitchen, a long-time South Bay non-profit, for the Thanksgiving rush. In three weeks, staffers will prep and hand-out a thousand meals for the less fortunate. But on this day, Garcia’s attention is split – between what is, and what could be the non-profit’s good fortune.

"Of course we all think about it and we talk about the lottery and playing and things like that. That kind of money could not only change one person’s life, but several people’s lives," she said.

The Powerball jackpot had players praying for the odds to fall in their favor, as they were reciting their innermost desires.

"Go crazy," said one man. "Pay off the house. Get a new car. Give some to charity," said another. A third said, "Oh, of course I’ll try to give some to all the local charities. Some special needs in the Vietnamese temple. And of course schooling. I believe in the future for the kids. And of course save some for the family."

San Jose State tax expert Caroline Chen has four must-dos for anyone who becomes uber rich overnight.

"You could use those donations to perhaps reduce your taxable income," said Chen.

She advised taking a lump-sum payment of roughly $600 million, and then paying taxes. California doesn’t tax lottery winnings, but the federal government will.

"But of course those millions of dollars will put you in the highest tax bracket. And depending on if you’re married or single, it’ll be about 37%," Chen said.

With taxes having whittled half the winnings down further, to approximately $380M, Chen’s list beyond charitable donations includes investing some money. Experts said the stock market has historically grown wealth. Or, in something less volatile, such as real estate, which always seems to bounce back.

"If you could pay something for a piece of property in cash? Maybe that’s your best bet," said Chen.

Next, Chen advised saving some of the winnings.

"What you want is a large enough principal to earn money, so that you can live off that," she said.

It's a simple formula that ordinary people and those working for non-profits hoped would lead good fortune, and a good deal of charitable giving.

"I’m hoping it is a local person, and they’re going to support local charities and non-profits…that would be fantastic," said Garcia.

Experts said the odds of winning decrease when there’s a huge jackpot, because so many more people are buying tickets and entering the prospective winning pool.

Jesse Gary is a reporter based in the station's South Bay bureau. Follow him on Twitter @JesseKTVU and Instagram @jessegontv