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A Powerball Lottery ticket is shown in this photo illustration after being purchased at a gas station in San Diego, on Feb. 10, 2015. A winning ticket sold in Puerto Rico has some wondering if its winner should be legally allowed to cash in. Reuters/Mike Blake

The revelation that a winning ticket from Wednesday’s big Powerball drawing was bought in Puerto Rico has sparked some outcry at the notion that someone outside the continental United States could cash in. Wednesday’s Powerball was for $564.1 million, the multistate lottery’s third-largest jackpot ever, and it will be split three ways between Puerto Rico's ticket holder and two others who bought a winning ticket in North Carolina and Texas, respectively.

Requisite offensive tweets ensued -- including one that blamed U.S. President Barack Obama -- but there's one fact that some posters apparently weren't aware of: Puerto Rico is a United States territory. In fact, Puerto Rico officially became a U.S. commonwealth more than a half century ago, making Powerball sales -- and winnings -- there completely legal. The same is true for Washington, D.C., which is also not a state, and the U.S. Virgin Islands.

Fox News Latino questioned the legitimacy of buying a Powerball ticket in Puerto Rico, echoing some of those tweets and saying it's unclear if the winner there will be subjected to federal taxes, something that the Assistant Secretary of the Lottery in Puerto Rico can’t adequately respond to. “We asked the IRS that same question in October, but we haven’t received an answer yet,” Antonio Perez Lopez said. The popular lottery game is new to the island nation as of October 2014.
Any lottery winnings in Puerto Rico are still subject to the mandatory 20 percent state tax. However, according to Forbes, Section 933 of the U.S. tax code provides an exemption for Puerto Rico residents from paying federal income tax on "Puerto Rico-sourced income." So taxes would get paid, just not on the federal level. By Thursday afternoon, however, no one in Puerto Rico had yet stepped forward to claim the winnings, according to Fox News Latino.
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