Why 'America's Got Talent' Winners Get Only A Fraction Of The $1 Million Prize That Is Advertised

Summary

• America's Got Talent winners don't receive the $1 million prize promised, with many only receiving a fraction of that amount.
• Winners can choose between yearly payments for 40 years totaling $1 million or a lump sum payment of around $300,000.
• Taxes and other factors can significantly reduce the prize money, making it crucial for winners to make wise financial decisions.

When people audition for America's Got Talent, they have to be willing to put up with a lot of headaches. After all, people who audition on America's Got Talent have to follow strict rules and risk being harshly judged by the public as evidenced by fans questioning if one audition was fake.

Fortunately, on top of America's Got Talent's rich judges, some winners have become very wealthy too. However, the truth of the matter is that winners don't actually get the $1 million prize the show promises.

'America's Got Talent' Winners Don't Get Anywhere Close To $1 Million, Despite How The Show Makes It Seem

From the very beginning, America's Got Talent has seemed like a show that could make anyone with an impressive skill very rich. After all, the show routinely makes it seem like each season's winner gets a $1 million prize.

On top of it being stated on the show that there is a $1 million prize, America's Got Talent's imagery invokes riches. Most notably, America's Got Talent's golden buzzer literally makes it look like gold is raining down on the people auditioning.

However, based on everything that has been revealed about the America's Got Talent's prize, the truth is far from what the show makes it seem. In fact, no matter what the season winners do, they will never get anything close to $1 million in their bank from the prize.

Right off the top, if each America's Got Talent winner was handed a $1 million check by NBC, they still wouldn't get that much money. While some viewers may not think about it, the reason for that is obvious.

How rich are America's Got Talent's first 10 winners?

When someone wins a prize like that, they have to claim it as income when they file their taxes. That means they will have to pay a large chunk of their prize money to the government.

If an America's Got Talent winner tried to avoid paying taxes on their prize, they would likely go to jail. After all, Richard Hatch didn't pay taxes after he won $1 million on Survivor, and he wound up spending time in prison as a result.

Unfortunately for anyone who wins America's Got Talent, taxes aren't the only thing that can severely deplete their winnings. The reason for that, as a September 2016 Forbes article revealed, is that winners like Season 8's Kenichi Ebina will have to make a choice about their winnings.

Depending on the choice each winner makes, their prize money may be depleted a lot more, to say the least.

As the Forbes article reveals, America's Got Talent winners, by default, get $25,000 per year for 40 years, which adds up to a total of $1 million. Alternatively, winners can get a lump sum payment of roughly $300,000.

If winners opt to get the lump sum, they would probably hope that would be the end of their prize getting depleted. Sadly for the winners, however, they would lose another huge chunk of that $300,000 figure.

According to Forbes' aforementioned article, if Season 10's winner Paul Zerdin opted to take the lump sum payment, he would still have to pay taxes on the $300,000. Forbes estimates that winners who've taken the lump sum payment have received between $150,000 and $200,000.

Based on Forbes' reporting, it is amazing that any of the winners would take the lump sum. However, the truth is that a lot of people are impatient and wouldn't want to wait for their money. After all, at $25,000 per year, a winner would have to wait eight years to get $200,000 from their winnings. Or they could take the lump sum and maybe get it right away.

There is one more reason why it would make sense for each America's Got Talent winner to take the yearly payments. As a Business Insider article that was updated in March 2024 outlines, a lot of lottery winners have gone broke. As a result, it would probably be a good idea to take annual payments instead of a lump sum that can quickly be lost.

Terry Fator Proves That America's Got Talent Winners Can Still Use Their Prize Money To Change Their Lives

In September 2017, Terry Fator was interviewed by Parade about his life since his America's Got Talent win. During the resulting conversation, Terry spoke about what he was able to do with the prize money he got from winning America's Got Talent.

When most people envision what they would do if they won a lot of money, they think about buying the things they've always wanted. However, while talking to Parade about what he did with his prize money, Terry began by describing a responsible choice he made.

“It's amazing. It's absolutely amazing how it can really genuinely change your life. What it did for me was, I was able to completely pay off all my bills."

Of course, Terry is an entertainer, so people would likely expect him to do something more fun than paying bills. Fortunately, Terry did something a lot more entertaining than paying bills. Terry went on to tell Parade about how he invested his winnings in entertaining his fans.

"I was able to invest in getting some new characters and puppets.”

While Terry didn't get the joy of spending his winnings on crazy things that caught his fancy, it seems like he could do that now. After all, those performances Terry invested in allowed him to enjoy years of success in Las Vegas which made him very wealthy.