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Friday, September 5, 2008

House Ways & Means Chair Rangel Failed to Report $75k Rental Income From Second Home

The New York Times reports that House Ways & Means Committee Chair Charles Rangel has failed to report an interest-free loan and over $75,000 in rental income on his second home at the Puntacana Resort & Club in the Dominican Republic:

Mr. Rangel will probably have no federal tax liability, [his attorney Lanny] Davis said, because he considered the villa an investment rather than a vacation home, and was therefore entitled to deduct depreciation on the property, as well as taxes the resort management paid to the Dominican Republic.

Mr. Davis declined to release copies of the congressman’s tax returns and said he was gathering documents showing how often Mr. Rangel stayed at the home during the past two decades, a critical question because the Internal Revenue Service does not allow a property owner to deduct as much depreciation on a second home that the owner uses more than 14 days per year.

Mr. Davis said the congressman did not realize he had to declare the money as income, and was unaware of the semiannual payments from the resort because his wife, Alma, handled the family finances and conferred with their accountant, John Viardi, on tax matters.

(Hat Tip: Anand Desai.)

http://taxprof.typepad.com/taxprof_blog/2008/09/house-ways-mean.html

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Comments

... the congressman did not realize he had to declare the money as income...

And this Democrat is Chairman of Ways & Means Committee. What does the Ways & Means Committee do? I think it has something to do with the tax code.

Posted by: anon | Sep 6, 2008 1:51:36 PM