'Jeopardy!' champ James Holzhauer likely owes $1.2 million in taxes

Holzhauer doesn't think he changed game forever

  "Jeopardy!" champion and professional sports bettor James Holzhauer lost in his 33rd episode of the TV game show, which aired Monday, finishing $58,484 short of the all-time winnings record. (The show aired first on the CBS affiliate in Montgomery, Alabama, on Monday.)

Of course, Holzhauer, 34, won big. He made $2,462,216 in those 33 appearances, including the $2,000 prize he received for finishing second in his last show on Monday. Only one "Jeopardy" champion, Ken Jennings, has made more money ($2,520,700) and had more appearances (74).

The IRS also won big. All winnings on game shows are considered ordinary income, taxed up to 37% by the IRS. And most states have state income tax, too.

Even though Holzhauer is a resident of Nevada, the game show took place in California, which means he must pay taxes in that state, sports and betting website The Action Network reported. Combined, federal and California state taxes will put Holzhauer's net winnings at $1.29 million — a 47.6% cut, the site said.

Despite not besting Jennings' record total winnings back in 2004, Holzhauer does hold the all-time record for the most money earned in a single Jeopardy episode — $131,127 — and also owns the record for the top four money-winning episodes.