Understanding the Tax Implications of Winning 'Squid Game: The Challenge'

Allison DeGrushe - Author
By

Dec. 11 2023, Updated 10:53 a.m. ET

'Squid Game: The Challenge' final three players.
Source: Netflix

The Gist:

  • Squid Game: The Challenge sees 456 players compete to win a cash prize of $4.56 million.
  • The reality competition series was filmed in the UK, where prize money is exempt from taxes.
  • If the winner hails from another country, they may be subject to taxes imposed by their home nation.
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After just nine episodes, Squid Game: The Challenge crowned its first-ever winner! This champion, who we now know is Mai Whelan, not only strutted away with some serious bragging rights, but also pocketed a whopping $4.56 million — the largest single cash prize in reality television and game show history.

Now, let's talk about money! After taxes, what's the scoop on how much cash the Squid Game: The Challenge winner stuffs into her pockets? Stick around, because we have all the answers you're looking for.

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'Squid Game: The Challenge' prize money.
Source: Netflix

How is the 'Squid Game: The Challenge' winner's prize taxed?

For those unaware, Squid Game: The Challenge was filmed in the United Kingdom, where prize winnings are exempt from taxes. But here's the twist — if the winner in any given season hails from another country, say the United States, they're not entirely off the hook.

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As it turns out, the Land of the Free overlords cast their wide net over global income, including those massive game show winnings. So, even though the U.K. is giving them a tax pass, an American victor has to cough up a decent amount of their earnings. That means Mai, for the inaugural season of the reality competition show.

'Squid Game: The Challenge' cash prize.
Source: Netflix
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According to Turbo Tax, snagging $1,000 in a drawing means you're a cash prize winner. Now, cash prizes aren't just confined to lucky draws — you could win cash prizes in a sweepstakes, a game show, or on a reality TV competition like Squid Game: The Challenge. So, whether you're making it rain or flaunting a lone dollar bill, you must include all prize earnings as income on your tax return.

The amount of tax the Squid Game: The Challenge winners pay depends on where they live and how much cash they take home. Turbo Tax noted that opting for a lump sum payout, especially for a substantial jackpot (like $4.56 million), could place them in the highest tax bracket, resulting in a minimum tax obligation of 37 percent owed to the IRS.

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Mai wins Squid Game: The Challenge
Source: Netflix

'Squid Game: The Challenge's first winner didn't get her prize money right away.

The first season of Squid Game: The Challenge filmed in early 2023. But, Mai shared with The Times in December 2023, she still hadn't received her payment from Netflix. Luckily, according to a show source who People spoke with, there is reportedly a payment plan in place for one month after the finale airs.

Chances are, that will be the case for any future seasons as well.

Watch Squid Game: The Challenge on Netflix.

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