Bad beat jackpot

A bad beat jackpot is a standard jackpot system found in most poker rooms in the United States. It awards a (usually large) cash prize to a player with an extremely powerful hand who nonetheless has it beaten at a showdown.

Funding and Payout
In most cases, a separate rake is taken from each pot above a certain size, and deposited into a separate drop box at the table by the dealer. (In some casinos, there is only a single rake, and the jackpot is funded out of the total sum, but in most it is held separately). In nearly all cases, this extra jackpot rake is a dollar, though in some cases it may be higher, or it may be only 50 cents.

Jackpot rakes are usually not collected from very small pots or from pots which did not see a flop.

Bad beat jackpots usually also include a "backup" jackpot prize, which is funded at a slower rate than the main jackpot (say, with one dollar for every three that goes into the main jackpot). This is not awarded to any player, but is used to replace the main jackpot prize when the main jackpot is won. This is to avoid the jackpot cycling back to zero once it is won, which would be seen as quite unlucky or unfair for a player who won the jackpot only a few hours after someone else won it earlier.

After each day's jackpot rakes are collected, the casino calculates how much to raise the jackpot prize by, and announces the new jackpot amount, usually in the middle of the night. Usually, bad beat jackpots are capped at some large amount, such as $50,000. After that point, jackpot rakes are used to fund the backup jackpots more quickly, to fund more backup jackpots, or to fund additional jackpots such as high hand jackpots or monte carlo jackpots.

Generally, the bad beat jackpot amount is awarded to the entire table where the bad beat occurred, using some sort of ratios like: Some poker rooms set different ratios, and some have slightly different rules for qualifying for the final 25% split (some say you need not be dealt in, but must be seated; others say you may even not be seated but cannot have a missed blind button in front of you - check at each room for details).
 * 50% to the losing hand which qualified for the bad beat
 * 25% to the winning hand
 * 25% split equally among all other players at the table who had been dealt into the hand

This last portion which is split equally among all other players at the table who weren't the winner or loser is called the table share.

Qualifications
Each poker room specifies their own conditions which would qualify as a "bad beat". A typical condition would be "Aces full of jacks or better, beaten by four of a kind or better". Notice that in many cases, the poker room will specify not only the minimum strength of the beaten hand, but also the minimum strength of the winning hand.

Some poker rooms have two or more sets of conditions, and award different amounts for different sets of conditions. They may have a "small bad beat jackpot" that is awarded when any aces-full hand is beaten, and then a "large bad beat jackpot" awarded only when a hand stronger than quad sevens is beaten.

In nearly all cases, poker rooms specify that both the winning and losing hand must use both of their hole cards to form their best five-card hand. This is to prevent situations like a board being AAAKQ, and three or four players having either a King or Queen in their hand, all claiming to have won the jackpot. In many poker rooms, when quads are involved in a bad beat jackpot, the player must have a pocket pair - though some rooms allow the player to have any two cards to make their four-of-a-kind, as long as both cards play.

Note that if a board is 777J9, a player hand such as 7K has quads with a King kicker that does play, while a hand such as 78 has quad sevens with a Jack kicker and the 8 in the player's hand does not play and will usually not qualify for a bad beat jackpot.

Other rules
Poker rooms which have been around for a while often have many other rules about their bad beat jackpots to avoid sticky situations.

In particular, it does occasionally happen that two players get "badly beaten" in a single hand (e.g. one player makes a royal flush while another makes a smaller straight flush and a third makes four of a kind). The rules generally stipulate that the highest losing hand gets the largest share of the bad beat jackpot, while the lower losing hands merely participate in the table share.

Local Variations
The rules for bad beat jackpots are not standard and vary greatly from poker room to poker room. Always check with your local floorman if you have any questions.