Ryan Seacrest took over hosting duties on Wheel of Fortune this year after Pat Sajak's retirement.
The game show remains one of the most popular programs on television.
But Wheel of Fortune vacation winners were hit with one nasty surprise that left them scrambling.
Winners discovered "free" vacations come with crushing tax bills
Former Wheel of Fortune contestants opened up about what really happens when you win one of those dream vacation packages.
The reality is a lot less glamorous than the celebration you see on TV.
One winner who scored a trip to Hawaii valued at $9,000 said the vacation itself exceeded expectations.
"I wasn't expecting it to be nearly as nice as it was," the contestant wrote on Reddit.¹
The prize included a seven-night stay in a two-bedroom ocean-facing suite at the Aston Waikiki Beach Tower along with airfare and spending money.
But here's the punch in the gut that nobody sees coming.
That "free" vacation came with a $19,000 tax bill after the winner also took home $36,000 in cash and a car during the bonus round.
The contestant had to use their cash winnings just to cover the taxes on everything they won.
"They deduct 7% of your total winnings from your cash for California taxes," the winner explained. "I got all that back when I filed my taxes since I'm not a California resident."²
One contestant found a sketchy loophole that had producers fuming
Another winner who scored a Caribbean vacation said the trip was considered "earned income" for tax purposes.
"I looked at the trip as an all-expenses trip that was like 70% off of what the face value would have been," the contestant said.³
Translation: You're paying roughly 30% of the trip's advertised value in taxes out of your own pocket.
And you can't negotiate for a cheaper version or take cash instead.
Multiple contestants confirmed Wheel of Fortune makes you either accept the exact prize package or decline it entirely.
But one winner decided to test the system.
When checking into his hotel, he put down a credit card he knew had almost no room for charges.
Then he went to town — charging WiFi fees, extra meals, and "tons of drinks" to the room knowing the card would get declined.
Total damage: $700 in charges the hotel couldn't collect.
Once he got home, the Wheel of Fortune prize coordinator called demanding payment for the declined charges.
He played dumb, claimed he'd provided a credit card at check-in, and never heard about it again.
Game shows inflate prize values to stick winners with bigger tax bills
Here's the dirty secret about how these vacation packages get valued.
Wheel of Fortune reports hotel packages at top retail rates — not the discounted prices you could book yourself online or through a travel agent.
That jacks up your tax bill while the show gets to advertise bigger prize amounts.
It's a win for the show and a loss for the contestant.
Game shows typically withhold 24% upfront for federal taxes on winnings over $600.
But that's rarely enough to cover what you actually owe.
Your total tax rate depends on your income bracket, and state taxes can push it to 35% or higher.
A contestant who won a $30,000 car could owe $6,600 or more in taxes — with no cash to cover it.
That's why some winners refuse prizes or sell them immediately.
Large prizes can push you into a higher tax bracket, meaning you pay even more than expected.
One Price is Right winner discovered he owed taxes on $57,000 worth of prizes including a truck, appliances, and a trip.
The show sent him a "tax letter" totaling up what he owed before taking ownership.
He nearly walked away from everything.
Winners who know what they're doing set aside at least 25-30% of any prize's value immediately for taxes.
Otherwise that dream vacation turns into a nightmare with penalties and interest piling up.
The IRS doesn't care if the vacation was free
Wheel of Fortune and other game shows report all prizes to the IRS using Form 1099-MISC.
The show submits the paperwork and the IRS expects you to pay up.
Ryan Seacrest's first season hosting Wheel of Fortune brought in the show's highest ratings in three years.
But he inherited a system that leaves winners celebrating on TV one day and scrambling to pay tax bills the next.
The contestants who walk away happiest are the ones who win straight cash.
At least then you have the money to cover what you owe instead of digging into your own pocket to pay taxes on a "free" trip.
¹ Reddit user, comment on r/WheelOfFortune, "What happens when you win a trip on Wheel of Fortune," July 2025.
² Ibid.
³ Reddit user, comment on r/WheelOfFortune, July 2025.