How Does Taxing Work on a TV Game Show Winner?
Like lottery winnings, game show winnings are taxable in a variety of ways. For starters, it is important to note that cash and non-cash prizes (new cars, paid vacations) are taxable. When you take into consideration your current annual income, coupled with the amount of your winnings, receiving money from a television game show could push a contestant into a higher tax bracket. This will cause him to pay more taxes overall at the end of the fiscal year. A person’s federal tax bracket can go up to a maximum 39.6 percent. Aside from being placed into a higher tax bracket, game show winnings are also open to state income taxes. Depending on the state, a person could give as much as half of her winnings away to the state government. There are no tax breaks for game show winners in the majority of the 50 states of the U.S. In addition to state income taxes, many states withhold up to 28 percent of a contestant’s winnings to pay for taxes up front. However, if this is not enough money to co
