America’s Got Talent‘s fifth winner, Michael Grimm, received only about $200,000 as his prize for winning the show, which advertises its prize as $1 million.
That’s because he took the lump sum, instead of getting paid over time.
During the show’s second season, I analyzed the fine print of America’s Got Talent’s $1 million prize in detail, discovering that it was worth about $375,000 after taxes, but that was based on 2007-era assumptions about tax rates.
The key is that AGT’s prize is not $1 million: it’s $25,000 a year or a lump sum.
The Sun-Herald reports that Grimm ultimately received “a little more than $200,000, he said, once the network got its cut of more than 50 percent and he paid taxes on the lump sum he received.”
It’s not clear what NBC’s “cut” means, whether he had to pay them something, or if it’s just referring to the reduced value if one opts for the lump sum.
Sunday, Grimm’s grandparents moved into a new house; theirs was destroyed by Hurricane Katrina, and Grimm vowed to build them a new house when he won in 2010.
That was delayed by shoddy work done by an unlicensed contractor that had to be fixed, according to the paper.