Winner reveals inside scoop on game show prizes

Josh Woo Jan 20, 2015

Congratulations! You’ve just won a ton of money and prizes on a game show.

But before you redraw your floor plans to accommodate those new kitchen appliances you won, consider the following:

1. The show may substitute cash for some of your prizes.

The video above shows just one way I got lucky when I won on “The Price is Right” back in 2010. I was quite pleasantly surprised, but still confused, when I was handed my prize paperwork. I discovered that instead of the three-month virtual assistant service, among other things, I had just won in my “showcase,” I was getting the cash value instead.

On my prize sheet, certain prizes are labeled “C-I-L”: cash in lieu. I wasn’t given the option to receive the actual prize instead, and I couldn’t trade one of the other prizes I won for their cash value, either.

As Art Alisi explains, that’s because the show buys some of their prizes — and there’s a way to tell if they did, if you listen closely during the show. When they say, I’m just gonna say Goodyear tires [as an example], ‘You’ve won a set of Goodyear tires, from the number one store, Goodyear,’ then you know that was promoted. If they just said you won a wonderful set of rubber tires, they bought it. So it’s just as easy for them to give you the cash.”

Again, not that I’m complaining.

2. Reruns once meant more gifts.

One thing should be made abundantly clear: If your show airs as a rerun during the off-season, you don’t get paid a second time.

“Jeopardy!,” among many other shows, used to give sponsored parting gifts to departing contestants  the classic Rice-A-Roni comes to mind. They don’t do that anymore. My “parting gifts” from “Jeopardy!” amounted to a tote bag, a T-shirt and a glass frame for my photo with Alex Trebek.

When Jerome Vered played in the 1992 Tournament of Champions, he finished in third place and received the announced third-place parting gifts in addition to his runner-up prize of $7,500. What he didn’t realize was that when his tournament games aired again over the summer, the show changed the fee plugs at the end of the episode.

“So about a month later, as a loser, I get this huge package from “Jeopardy!” of all these … left-handed toothbrushes and all these other things they were giving away. I got a whole ‘nother set, like a residual, but I didn’t actually get my money again.”

These days, all you get for a rerun is a second chance to record your episode.

3. You don’t receive your winnings immediately.

You don’t get to drive off the set in the new car you just won, nor do they immediately pay you any money you win once you step off the stage. It usually takes between 90 and 150 days to receive your prizes.

Alisi says the prize department needs to verify that you are indeed who you say you are when you go on the show….

Alisi says: “I had one where someone told me he was an admiral, and the FBI came in and wanted to know where we found this man. And they told us, ‘He’s not an admiral, he’s been impersonating an admiral for 30 years.’ They arrested him, and whatever he won, they took away.”

.. .and to make sure you’ve paid your taxes on your prizes. In the case of “The Price is Right,” out-of-state contestants like me have to pay California state taxes before accepting any prize. “Let’s say you’re in Illinois, and we sent the prizes, and you didn’t pay the taxes,” Alisi says. “We’re liable to pay those taxes. So we make sure you’ve paid the state taxes before we deliver the prizes.”

Once a prize is won, the show contacts the appropriate prize supplier to let them know they’ll need to save an extra – let’s just say desk chair for the lucky contestant. “We have to notify the prize providers to say that they’re going to be on the show, and then we send them another certification saying you have 90 days to send the gift,” says Alisi.

4. The show isn’t the only entity paying out prize money. 

"Prizes for our second and third place contestants provided by Aleve."

Prizes for our second and third place contestants provided by Aleve.

Call it a sneaky way to get in some additional advertising, but in the case of the above photo, Aleve will actually cut the runners-up a check for the standard second- and third-place prize.

You see it elsewhere, too. When “Wheel of Fortune” used to have the “Jackpot Round,” which would be prefaced by a short plug for the round’s sponsor. The arrangement with the show was similar to that of the Aleve plug “Jeopardy!” uses today, but with a significant difference. 

"Tonight's Jackpot Round is brought to you by Pizza Hut..."

Aleve pays out $3,000 an episode, because, unless something strange happens, every show will have someone finishing in both second and third place. However, the sponsor of the “Jackpot Round,” says former prize coordinator Adam Nedeff, only had to pay out when the jackpot was won. If it wasn’t won, which was most of the time, the sponsor effectively got a free commercial. 

But suppose there was a week when the Jackpot was won every time it was offered. Nedeff says the sponsor only was responsible for paying three of those Jackpots; “Wheel” would pay the rest, and the sponsor would get the free commercial on those nights anyway.

“That was the best way to get the sales pitch,” Nedeff says, “because the sponsor of that round is getting a fantastic deal. It’s not, ‘Hey, it’s “Wheel of Fortune,” it’s this fantastic show that all of America is watching,’ it’s, ‘You are getting a really, really cheap commercial here.’”

5. Trips aren’t always worth as much as the show says they’re worth.

It’s no secret that game show winners are taxed on whatever they win, and the amount of taxes a contestant has to pay partly depends on the value of the prizes they win.

In the case of trip prizes, though, the value announced on the show may be different from what the player is actually taxed on, because the value announced on the show reflects the price of the trip during the sponsoring hotel’s peak season.

One of the things we have to hammer home is that we have to honor blackout dates,” says Nedeff. “A lot of places do not want to offer a trip that’s going to be redeemed during Thanksgiving or Christmas weeks, because that’s the week when the big money is coming in for the hotels.”

Contestant paperwork explicitly states that winners of trips have up to 365 days following their airdate to redeem their prize, so the value of the trip can fluctuate depending on when the trip is taken.

“If the person actually did redeem the trip, we would find out what the comparable rate would have been for the time of year that they were staying there,” says Nedeff. “And when it came time to pay the taxes for their prizes, the contestant was only taxed on what they would have paid during the offseason.”

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