The crowd screams, the confetti falls and the contestant looks shocked. They have reason to be stunned, too, as they’ve won the ultimate game-show prize. But once the spotlight turns off, what happens next to the lucky player and their spoils? Well, unfortunately, the reality isn’t quite as glamorous as the victory itself may seem on TV.
Game shows themselves have a long and fabled history, however. At first, they were a fixture of radio; as television technology became more readily available in the U.S, though, the format was adopted to the small screen too. And by the 1950s, game shows had become a staple on American TVs during the day and in primetime.
Today, series in which contestants play for prizes remain popular around the planet. Take the success of Who Wants to Be a Millionaire?, for example. Since the show first hit screens in the U.K. in 1998, in excess of 100 versions have been made worldwide for different countries.
Only a handful of people have had the honor of winning Who Wants to Be a Millionaire?’s grand prize, however. And when Dr. Kevin Olmstead appeared on the American version of the show in 2001, the stakes were even higher for him, thanks to a change in the rules.
Specifically, with every episode of the show that ended without a $1 million winner, $10,000 was added to the prize pot on top of the initial seven figures. No one had won the jackpot for five months before Olmstead’s appearance, though, so Olmstead had a shot at acquiring $2.18 million. And by the time the Michigan native reached the final question, he quickly realized that he’d had a stroke of very good luck.
As the show’s host, Regis Philbin, read out the last piece of trivia, Olmstead raised his eyebrows and looked shocked as the question appeared on the screen before him. Then, as soon as Philbin finished, Olmstead couldn’t help but declare, “I know this!”
But upon scooping the $2.18 million, Olmstead’s mind turned not to how he would spend his money but something else entirely. “My thoughts as Regis announced I won was not slipping on a Plexiglass floor now with confetti on it – so I moved gingerly,” Olmstead later told website FashionBeans. But he still celebrated his win with his mom, who was in the audience, as the brightly colored paper showered down in the studio.
After that moment, though, it may seem like Olmstead would have been able to shout of his millionaire status from the rooftops – not to mention spend all of his money to his heart’s content. But the Ann Arbor man and many other winners have found that the post-show journey isn’t nearly as exciting as many may envision.
For starters, Olmstead’s episode of Millionaire wasn’t airing live – not many game shows do. That meant that the engineer and his mom would have to keep his win a secret until his episode went live in a nail-biting three weeks’ time.
In the grand scheme of things, though, Olmstead’s wait wasn’t as excruciating as others. For example, when Susan Campagnone won $1 million on the show Monopoly Millionaires’ Club in 2015, she couldn’t tell anyone the news for nearly five months.
Fortunately, Campagnone’s fiancé had attended the taping, so she could at least discuss her windfall with him. Still, Campagnone told The Week in 2015, “I think that’s been the hardest part through all of this – keeping it amongst ourselves and not being able to share.”
However, Olmstead took advantage of the gap between his show being taped and aired by making financial preparations. He dealt with bank accounts and considered stock options, for instance. Olmstead even bought internet domains in his name to prevent web-savvy people from purchasing them and attempting to cash in on the soon-to-be well-known millionaire’s celebrity.
But there are further financial implications of winning a game-show prize than just finding the right place to store the money. For one, the cash won by TV contestants in the U.S. incurs tax – just like any other earnings throughout the year.
Multiple governments will take a piece of the pie too. Federal taxes apply when it comes to game-show jackpots, as do state taxes in a contestant’s home state and the area in which the prize was originally won. It’s possible to get credit back on home state taxes after paying up in the filming location, though.
And contestants who win goods on game shows aren’t off the hook, either. In fact, they might be worse off than those who win money. That’s because they also have to pay taxes on their furniture, cars or whatever other items they may have earned on TV. And if they don’t win a monetary prize as well, the IRS will therefore leave them out of pocket.
Plus, game shows may hike up the retail value of their prizes, which means that participants could receive higher tax bills than if they had compared prices and bought said items themselves. This, along with the tax payment, may lead some contestants to consider foregoing their winnings altogether.
Even so, some individuals may think that they can outsmart the system by taking home the cash value of their hauls rather than any physical prizes. Unfortunately, this typically isn’t an option; the only way to exchange goods for money, then, is to sell them the old-fashioned way.
In the case of Millionaire contestant Olmstead, the government ended up taking back $900,000 of his $2.18 million – and that was that. “There is no way to shelter [the money] or anything,” Olmstead told FashionBeans. “As a tax attorney put it, ‘It’s income. It’s earned. Deal.’”
Olmstead spent his winnings responsibly as well. He told AOL in 2010, “I got a luxury condo… don’t have to mow the lawn. I [also] bought the vehicle of my dreams: a fully loaded minivan.” And as it happens, Campagnone was down-to-earth when it came to her prize too.
Indeed, the Monopoly Millionaires’ Club champ fully realized that her $1 million wouldn’t change her life entirely. She did take her family on vacation, however; and she admittedly admired her bank account after receiving her post-tax prize winnings. She told This Week, “Honestly, when I received the money, I just… I had to keep looking at it, saying, ‘This is real.’ I’ve never had this amount of money in my life.”