And the car! When my wife and I were married in 1987, those prizes helped furnish our first apartment, and, by the way, we both had cars that were fully paid for. I kept everything, because, well, why not? For just $2,100 in taxes I got some very nice hand-crafted furniture, a stereo console TV (big stuff in the ‘80s), a home gym set, and a whole bunch of things I never would’ve considered buying for myself. So if we didn’t want to deal with the taxes, or if we wanted to keep the tax bill down, we’d simply say we didn’t want the stuff. It was pretty surreal.īy the way, the game show producers gave us three full days to decline any prizes we didn’t want to keep. I walked out, loaded my bike into the back of the truck, and drove back home with my brand new car.
I hopped on my bike and rode the three miles down to the Mazda dealer in Torrance, California, signed a couple of title papers, and within maybe 10 minutes, they handed me the keys. This lowered my overall total winnings to around $15,000, fair market value.Ībout a month after the show aired, I got a phone call from the local Mazda dealership saying my car was ready for delivery. I then had to itemize the entire list with the prices I was given by the retailers. This was pre-internet, so I was calling around, talking to salespeople and retail managers. Game shows notoriously inflate a prize’s value, so I spent a good week or two looking around for those same (or similar) items in stores and catalogs. You’re allowed by IRS rules to use the fair market value of any prize you win instead of what the game show says it’s worth. And without any cash winnings, and with very little income, I had to figure out how to pay the tax bill. So from a tax standpoint, even though as a recent college graduate I’d only earned about $4,000 of actual W-2 wages for that year, my total income as far as the tax collectors were concerned was just shy of $28,000. My total take-home from all of the prizes I won (furniture, exercise equipment, console TV, cases of Rice-a-Roni, but no cash) was $23,321.
Merv Griffin Productions reported its stated value of the car (and all of my other winnings) to both the California Franchise Tax Board and to the IRS. So what about the process was a pain? Very little, other than dealing with the taxes.
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