I am truly blown away by his ability to consistently answer questions without even needing a moment to think about the answers. I also wanted to thank those who have posted as I’ve learned so much about the game and, specifically, the buzzer. It’s an enjoyable diversion!
Are the shows taped and aired sequentially? Will James get a break or will be get a break from watching his winning streak? I enjoy watching him but also looking forward to watching someone else win.
They are not all taped and aired sequentially. In fact, this week’s shows could’ve been taped on a Tuesday and, if he wins the rest of this week, he’ll have taped the following week’s shows the next day, not 2 weeks later.
We’re just the ones getting the break.
I’m kind of glad for the break!
Given that James makes a living through gambling, I’d expect he has the tax thing well in hand. His income probably fluctuates every year, so he would have learned a while back that every big win comes with a tax consequence. He’s pretty good with math so probably has already done the calculations. At this point, 37 cents of every dollar he earns is going to the feds. If he’s smart, he’ll put it all aside as soon as he receives it; it’s likely he pays quarterlies anyway.
At 1.5 million, that leaves him with about 950k in winnings so far. And still more to come. Not bad at all. Especially given the residual financial opportunities based on the fame he’s generated for himself.
He’ll be in the Tournament of Champions and others in the future, I’m sure. I think he’s set. All of us self-employed people deal with the tax issue all the time.
Remember how Richard Hatch didn’t pay taxes on his “Survivor” winnings? Oops. He served a 51-month prison term.
James has stated that a portion of his winnings will go to several children’s charities in the Las Vegas area so that will lessen his tax burden. Of course we have no idea how much he makes at his day job!
Here are some of his favorite children’s books:
https://www.washingtonpost.com/entertainment/books/the-childrens-books-that-turned-james-holzhauer-into-a-jeopardy-champ/2019/05/02/e0835e5e-6cd2-11e9-8f44-e8d8bb1df986_story.html?utm_term=.75fddb64f7b2
No special tax, but he’ll be taxed in California as the money was earned there and not at the Nevada income tax (0%) rate. Taxes are withheld/paid up front.
“No special tax, but he’ll be taxed in California as the money was earned there and not at the Nevada income tax (0%) rate. Taxes are withheld/paid up front.
Most game shows are based in California, and thus the check that arrives often represents the total minus California state taxes. My cash prize from a game show taped in Hollywood was relatively small, so less than 10% was initially taken out.”
Not when I played. My check from Jeopardy was for the full amount of my winnings. Nothing was withheld.
Times have changed re:taxes being withheld.
James is a professional gambler, so he has a history of preparing taxes as a professional gambler. As such, he can subtract his losses from his winnings and can deduct anything that was an expense incurred towards helping him win. He can likely count the entire Jeopardy experience as an extension of his “job” as a professional gambler. He may be the only player in Jeopardy history that can deduct his travel, hotel and meal expenses. I don’t feel bad for him having to pay taxes at all. We all pay taxes (don’t we?). I feel bad for the 2nd and 3rd place losers who also have to pay tax on their winnings - with no deductions - and those winnings might not even cover their travel expenses.
@NJres Jeopardy pays their travel expenses.
“He may be the only player in Jeopardy history that can deduct his travel, hotel and meal expenses. I don’t feel bad for him having to pay taxes at all. We all pay taxes (don’t we?).”
When I played, Jeopardy did not pay travel expenses for playing in the regular season games. We were told that our travel expenses for the regular season games were deductible from our winnings (should we win anything). My travel expenses weren’t all that great. Just a tank of gas to drive from San Diego to LA and back, one night in a modest motel not far from the studio, and a couple of meals.
They did pay expenses for the TOC and the UTOC. For the TOC they put us up in the Beverly Hilton Hotel,which was owned by Merv Griffin at the time. For the UTOC they put us up in another nice hotel, but I can’t remember which one it was.
Unless things have changed, Jeopardy doesn’t pay travel expenses for new contestants, and only covers either hotel or air (don’t remember which) for returning players. Fortunately for James, it’s not far from Las Vegas to LA.
I think the withheld taxes are just the California portion, which for James will be hefty. He will have to do a quarterly payment to avoid under withholding.
There is some discussion on whether James’ winnings are gambling winnings or not. A gambler could certainly have other income that is not gambling winnings or losses (he could be a bartender or insurance man on the side), and what are his losses here? If he gets a question wrong, he loses money, but it is not real money just ‘points’ toward the win. The others don’t pay taxes on the $14000 they ‘earn’ because they never really get that money. If they are considered gambling winnings, the federal taxes would have withholding.
I’d think Jeopardy! would determine, for its purposes, that the winnings are not gambling winnings but regular income. I don’t think he’s worried about the $1000 or so he’s spending on travel per week to fly from Vegas and stay in a hotel, but why wouldn’t those expenses be deductible as regular business expenses (to the extent such expenses can still be deducted)?
The articles said Jeopardy! does not pay travel. Wheel of Fortune gives players $1000 for the travel. My friend’s son was on Jeopardy! last year and his travel wasn’t paid.
Since you get a 1099 for your Jeopardy winnings, you can deduct your travel expenses to earn that income (unless the new tax laws have changed that)
I think the point is that because James has a career already as a gambler, then he can elect how he treats the 1099 from Jeopardy – whether he subsumes it under his existing business, or treats it separately. IRS doesn’t really care as long as it’s reported. And given that Jeopardy is a game where everything can easily be lost on the outcome of a single question – it definitely is something that fits within James’ career as a professional gambler.
But overall, for James the travel expenses are a drop in the bucket, and any self-employed person could have figured out a way to make the airfare deductible in any event. (It’s just a matter of scheduling so that personal travel coincides with business-related travel). So probably not worth stressing over.
But with the California taxes on top of federal, James may end up with half or less of his overall winnings. Highest marginal bracket in California is 13.3% – but that only kicks in at the $1 million point.
If James is really smart (which he appears to be), he’s also paying money to a CPA to take care of all this for him.
I’ve seen this GEICO commercial a zillion times but when I watched it today again, all I could see was James! 
https://youtu.be/Ee05_q5o9oY
If you want to see how adorable and smart James was as a kid look at this. My Japanese cousin’s reaction to it was “James is Asian? Why does he seem to have grown out of it?” Lol. But yes his ancestory on his mother’s side is Japanese.