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The famous segment made television history, and got the highest ratings the ever-popular Oprah Winfrey Show enjoyed. During the 2004 season, Oprah struck up a deal with General Motors to give every member of her audience a new Pontiac G-6. She even told her producers to fill her studio audience with people who “desperately needed” a car. And until the moment of the giveaway, she let everyone think there would be a contest for a single car.

Before we get into the aftermath of the giveaway, relive Oprah’s “All-time favorite happiest moment ever” in the video below:

But this “happiest moment” came with a dark shadow. Benjamin Franklin famously wrote, “In this world nothing can be said to be certain, except death and taxes.” And Oprah’s audience members would find out just how true the old idiom is.

According to Nerdwallet, if you receive more than $600 worth of prizes in one year, you must list them on your income taxes. Depending on your tax bracket, you’ll then pay up to 9% state income tax and 10%-37% federal income tax on the full MSRP of your “free” car. The kicker is a loaded 2004 Pontiac G-6–worth $30,000–could bump some of Oprah’s audience members into a higher tax bracket. This might mean they paid higher taxes on their regular income too.

Oprah Winfrey stands behind a podium and speaks into a microphone.
Oprah Winfrey | Frank Micelotta/Getty Images

There’s more. Most states would normally charge the winners a sales tax on the full MSRP of their “free” new car. Luckily Pontiac stepped up and paid the sales tax on all its Oprah Winfrey Show prize cars.

Still, the tax bill on those $30,000 G-6s could have been anywhere between $3,000 to $13,800–depending on the recipient’s income. Many reported the total tax to be around $6,000. One Oprah audience member summed the problem up, “It’s not a free car, it’s more of a 75 percent-off car.” Well said.

So what was the result of the surprise tax bill? Some audience members turned around and resold their new cars. Others traded them in for a cheaper option, and enough cash for the taxes. A few got clever and took out loans so they could both keep the new car and pay the taxes over time.

For her part, Oprah learned a valuable lesson. As she continued her “Your wildest dreams” season, she made sure gifts came with a stipend to help offset the cost of taxes.

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Henry Cesari

Henry Cesari joined MotorBiscuit in 2021 and brings his deep interest in vintage cars, trucks, and motorcycles to the site. Having restored his first classic car at just 16 years old, Henry has wrenched on everything from overland campers to Japanese motorcycles and even pre-war Bugattis. Henry is also an avid attendee at local car shows and genuinely enjoys connecting with fellow auto enthusiasts.

Henry earned a Bachelor’s in Anthropology and English from the University of Vermont. He has since incorporated his love of the written word with his admiration of classic cars. While Henry is interested in vintage cars, he believes the golden age of cars is yet to come. He is confident journalists will play an important role in this revolution by exposing the industry as it is now and envisioning its possible future.