Paul L. Caron
Dean


Monday, October 6, 2008

Alaska Violated State Policy in Gov. Palin's Per Diems

Following up on this morning's post, Tax Profs Agree: Gov. Palin's Tax Returns Are Wrong:  Jack Bogdanski (Lewis & Clark) notes that the State of Alaska did not follow its own per diem policies in Governor Palin's case, as set forth in this two-page memo, Income Tax Implications of Long-Term Per Diem.  Jack notes:

This document is a potential blockbuster. It establishes two important facts:

  1. The state has long acknowledged that it had a duty to determine whether Palin's "tax home" was really Anchorage and Wasilla, a conclusion which would have required that her per diems be reported as taxable income.
  2. The state knew that when an employee is planning to spend a majority of her time on state business in the Anchorage area for a four-year period, Anchorage is the employee's "tax home," and per diems for time spent in the "tax home" are taxable income.

So why didn't Alaska officials follow the state's official policies and report Palin's per diems as taxable income on her W-2? Only they can answer that.

And how can the tax lawyer whose opinion was released by the McCain campaign on Friday say that "no special consideration was ever given to Governor Palin, notwithstanding that she was the governor of Alaska"?

https://taxprof.typepad.com/taxprof_blog/2008/10/alaska-violated.html

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Tracked on Oct 8, 2008 5:49:18 AM

Comments

Blockbuster? How so? Is a technical analysis decipherable only by tax geeks like us supposed to constitute proof of moral infirmity? Really? Claims like that make regular people conclude that we need to get a life...

The tax issue itself is mildly interesting, but the breathless "reporting" is misplaced at best. Let Palin and Rangel correct their returns, pay any back taxes and move on. Anything else encourages more of the politics of personal destruction. A majority of the public is tired of this tactic, no matter who practices it.

Posted by: AMTbuff | Oct 6, 2008 2:14:20 PM

I noticed that Professor Bogdanski's website shows "our endorsement" of Obama for President. Here's the link: http:/bojack.org. (However, it also appears that he has accepted paid advertising from the McCain/Palin ticket.) Perhaps we should have a conservative tax professor, if one can find him or her, weigh in on this topic? It also seemed to me that the Texas Tech professor, while not overtly partisan, had a lot of supposition of "likeliness" in his comments. Is there anybody out there who could argue that Palin would prevail, other than the after-the-fact opinion she received?

Posted by: R.E. Marsh | Oct 6, 2008 2:16:15 PM

Please get the word out to all the news outlets on this! Time to expose the hypocritical pitbull!

Posted by: KateLynn | Oct 6, 2008 5:33:26 PM

Blockbuster? Yeah, right.

The amount of tax we are talking about is tiny. Plus, even if the per diem's were handled incorrectly, it obviously was the employer (State of Alaska) or H&R Block's (tax preparers) error. The idea that Palin figured this tax law out and deliberately ochestrated this as a way for her to cheat on her taxes is absurd.

It's simply another sign of an overly complicated and vague tax code, which obviously many accountants and tax professionals don't even understand. The law and lawyers in this country have made 'criminals' out of us all.

Posted by: Evan | Oct 7, 2008 8:05:22 AM

While we do that, Kate, let's be sure to point out just how much less Palin charged to her expenses than her predecessor. And lets get the "real" number because what I've heard is that her expenses were 80% less than his.

(In other words... tax goof-ups aside... it's pretty dang impossible for anyone but a true believer to think that Palin was out to fleece the State and line her own pockets by charging expenses she wasn't supposed to get.)

Posted by: Synova | Oct 7, 2008 9:03:15 PM