That Time Oprah Gave 276 People Free Cars That Actually Cost Them $6,000 In Taxes

Screenshot: OWN (YouTube)

It’s the 15th anniversary of one of the greatest publicity stunts in all of television—the day Oprah Winfrey surprised an audience of hundreds of people in need of reliable transportation with brand-new Pontiac G6 sedans, but then left them on the hook for the thousands in taxes that came with them.

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The episode started with Oprah pulling 11 people seemingly at random from the audience and announcing what they all had in common—they all needed a brand new car, so Oprah gave each of them one. The audience, suffice it to say, began to go crazy.

Then a little box was handed out to every audience member, and Oprah informed them that inside just one of the boxes was the key to a brand new Pontiac G6. One more person in the audience would join the 11 others in Oprah’s grand giveaway. It was expertly crafted to throw everybody off the scent.

When Oprah finally let everyone open their boxes, everybody found a key, and everybody lost their mind. It was incredible television.

All-in-all, the stunt didn’t cost Oprah, nor the television network, effectively anything. As has been recounted many times, the entire stunt was part of a marketing strategy by Pontiac to get the Oprah faithful of America to go out and buy the new G6. Because of this, the sticker price of every car handed out on television was paid for by Pontiac itself.

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The problem for everybody who got a car, though, was that neither Oprah, the TV network, nor Pontiac accounted for all of the taxes the new vehicle owners would have to pay the government—a tax on the full $28,500 (in 2004 dollars) price of the car.

General Motors, the parent company behind the now-defunct Pontiac, covered the $1,800 state sales tax as part of the promotion, but since the vehicles weren’t considered as gifts to the audience members by the government, but instead promotional prizes (like winning the lottery, winning a car is calculated as part of a person’s gross income, so it’s taxed as income), the new G6 owners were on the hook for an estimated $6,000 to $7,000 in state and federal income tax.

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While it’s not necessarily a bad shake to get a brand new $28,500 car for just $6,000, or roughly a fifth of the sticker price, the Oprah team had reportedly specifically stacked the audience with people “in need of a car,” Forbes recounts. That would mean some of these folks are likely not the sort of people to just have thousands of dollars laying around to pay off the sudden tax increase. For others, who sold the cars, it helped them with stuff like financing a new business.

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But this was sort of uncharted territory for a television promotion, and likely done completely in good faith despite being ultimately rooted in the marketing department of General Motors. Still, winners of the cars had to either take the car and pay the tax, sell the car and still cover the tax fees, or refuse it altogether.

In later promotions, Forbes points out, the Oprah team had learned their lesson, writing checks and giving them to audience members along with the pricey prizes in an effort to offset the sudden burden of a spiked income tax.

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But as for the big G6 giveaway episode, Oprah got her iconic “you get a car” moment, the network got unprecedented ratings, Pontiac’s marketing team got a ton of buzz, and at least some of the audience members were able to get away with a brand new car, nearly free of charge.

It’s just too bad they then had to live with a Pontiac G6.

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