IRS will take bite of Joe's million
By Russ Wiles
Arizona Republic
Joe Millionaire, meet Uncle Sam.
AP file photo
For all those unlucky gals who got dumped in recent weeks by Joe Millionaire, here's a consolation prize: Joe will be back in the middle class before you know it.
Evan Marriott and Zora Andrich won't get tax refunds.
The recent finale of the hit reality TV show included a surprise payment of $1 million by the Fox network to Joe, also known as Evan Marriott, and his new girlfriend, Zora Andrich. But the couple face a costly date with the tax man.
Stanley Reynolds, a certified financial planner, wondered how much Marriott and Andrich would keep of the $1 million prize they split, so he fired up his professional tax software for answers.
Marriott's taxable income is more than simply his $500,000 share plus $19,000 from his construction job. He also has to account for all that free travel, entertainment, food and lodging as a taxable benefit, Reynolds said. He estimates it all at $529,000.
At this point, Marriott's federal tax bill is $179,000, Reynolds said, based on 2002 rates. He may also face $47,000 in California taxes.
Marriott may have done some tax planning to ease the bite. Reynolds assumed he might have plunked $3,000 into an IRA and donated $50,000 to charity. After subtracting taxes, and taking into account benefits from the donation and the investment, Marriott would have about $239,000 left over.
Andrich won't fare much better. She faces taxes on her $500,000, taxes on all her free travel and taxes on the jewelry Marriott (and Fox) handed out.
Reynolds estimates the value of the jewelry at $15,000. He also figures Andrich might have earned $18,000 in her job as a teacher. If she gave $50,000 to charity and put $3,000 into an IRA, she would have $246,000 of her half-million left, Reynolds said, assuming she stayed in New Jersey.
Marriott and Andrich will be richer for the "Joe Millionaire" experience, but not to the tune of seven digits.
