Paul L. Caron
Dean


Friday, February 12, 2010

Harold Ford Wants to be NY's Senator, but Hasn't Paid NY Taxes

Ford Gawker, Harold Ford's Tennessee Tax Dodge:

When it comes to his shadow run for Senate, Harold Ford is a New Yorker through and through. When it comes to paying taxes, though, he's still a Tennessean — he's never filed a New York return.

Ford claims to have moved to New York three years ago, and says paying "New York taxes" makes him a New Yorker. But his spokeswoman confirms to Gawker that he's never filed a New York tax return — meaning that he's never paid New York's income tax, despite keeping an office and a residence in New York City as a vice chairman of Merrill Lynch since 2007.

Ford presumably decided that his real home was Tennessee, which conveniently has no income tax. Which means that, despite the fact that New York law requires part-time and nonresidents to pay income tax on money they earn in the state, Ford has shielded his entire Merrill Lynch salary from New York's tax collectors for the past three years. In fact, it seems like Tennessee's lack of an income tax may be the best explanation for Ford's rather complicated two-state life since 2007 — he clearly wanted to live in New York, and married a woman in 2008 who did live in New York. But he made sure to keep a foot in a state whose tax code is friendly to rich guys like himself.

When Merrill Lynch announced Ford's hiring in 2007, it said he would be keeping offices in Nashville and New York City. Ford has said that he's basically lived in New York since then, though he never technically lived here until last year since he didn't "spend the requisite number of days" staying at his wife Emily Ford's breathtakingly yellow apartment in the Flatiron district. ("Moved is such a legal term," he told the New York Times). Ford was clearly thinking of New York's 184-day rule, which requires that part-time residents who spend 184 or more days living in the state pay New York taxes on all their income.

What he seems to have forgotten is that New York has gone to great pains to prevent wealthy people like him from spending time and earning money in the state and then jetting off to a tax haven come April 15: It also requires nonresidents and people who live there fewer than 184 days to pay New York income taxes on whatever portion of their income they earned in the state.

If Ford did enough business in New York to keep an office there, its reasonable to presume that he earned a good deal of money in New York. Now, we're sure that there are all sorts of accountants' arguments and narrow dodges at Ford's disposal to claim that he didn't owe New York income tax until he moved here last year: He could have been paid out of Merrill Lynch's Nashville office, for instance, and he could have received the majority of his income in a bonus that he could claim he earned in Tennessee, not New York. But while those sorts of arguments may be useful to someone trying to get as close as possible to living in New York without suffering the tax consequences of doing so, they're not as effective when you're loudly thinking about running for Senate in New York by claiming you've lived there for three years and pay taxes there.

https://taxprof.typepad.com/taxprof_blog/2010/02/harold-ford-wants-to-be.html

Celebrity Tax Lore, Political News, Tax | Permalink

Comments

Is there some reason the author of the article failed to mention Ford's party affiliation? I suppose I could look it up, but why should I have to do that?

Posted by: AMTbuff | Feb 12, 2010 1:46:24 PM

Does it matter if he pays taxes at all? They'll soon go down the drain of a sovereign default anyhow ...

Posted by: CrisisMaven | Feb 12, 2010 2:14:04 PM

CrisisMaven: Wrong sovereign.

Posted by: Dan | Feb 12, 2010 3:14:15 PM

Wow. It was bad enough when The Colbert Report caught Ford three times in a row of, "Yes I said that and then said I didn't and now I admit I did, because you played the tape for everyone here, but it doesn't really count..." This man, and the Steve Rattner-supported, cynical, hopeless DLC machine that created him need to go away.

Posted by: Liz | Feb 12, 2010 10:53:39 PM

Harold Ford is really getting under the skin of haters, the Gillibrand supporters and some bloggers if they are now stooping to attacking him for paying taxes. He follows and gladly pays his taxes - federal, state and local. Accusations that he shielded income are stupid, ludicrous and desperate on the part of political adversaries.

For his first 2 years out of Congress, Ford maintained a Merrill office and taught at Vanderbilt University in Nashville, while maintaining his official residence in Tennessee. In early 2009, after being married for 8 months (and the 2008 election), he and his wife decided to make New York their official home. He has always followed federal and state tax laws meticulously. He remains a private citizen, but if he decides to run for Senate, I'm confident he will comply with all candidate financial disclosures. Period.

Posted by: ChrisDJackson | Feb 12, 2010 11:29:04 PM

New York taxes are foolishly high. There is no benefit to the people of New York that justifies the current tax rates. Other states deliver better results with half the taxes. Ford should run and explain that he pays enough taxes and New Yorkers should have to pay no more than he pays.

Posted by: JAY | Feb 13, 2010 8:40:41 PM

Jr. is every bit as slippery as Sr. was. Who can forget Sr.'s congressional check kiting?

Posted by: Ford_driven | Feb 13, 2010 9:22:25 PM

it looks almost as bad as gillibrand's 42.3% (lead?) over ford in a dem primary. that she isn't over 50%, within the dem party, after her support for healthcare...

strangely enough she is pulling a 42.3% average in the actual race against pataki. well worth noting that pataki has 51 and 49 in marist and sienna.

hate to jump the gun on the politicos- saboto, cook, and rothenberg, but this seat looks lean republican, not the 'safe OR likely dem' they have it currently rated.

538 doesn't even have it in it's top 15 races?

Posted by: mark l. | Feb 13, 2010 9:28:31 PM

Huh, I guess he figured if it's good enough for Treasury Secretary Geithner, it's good enough for him.
But while I do believe that as ChrisDJackson said, that if Ford does decide to run he will file all requisite financial disclosures, I do believe that, however, if Ford DID say he's a New Yorker cause he's paid New York Taxes (and btw, if he maintained offices at Merrill in Manhattan then he needs to file for NYC income taxes too)then he really ought to have done so.

Posted by: realwest | Feb 13, 2010 9:35:55 PM

Classic Harold Ford maneuver. He sounds nice and reasonable, but there's a ravening Democrat partisan beast under it all. He wants to represent NY in the Senate but doesn't want to pay the taxes that his Democrats have ensured are quite high in NYS. Paying taxes that Democrats raise are for the little guy, not for the ones who tell us they know better than us how to spend our money.

Looks like Chris D. Jackson is Ford's rapid response team. His statement reads totally like a Democrat junkyard dog's, er, press secretary's or something. Spin, baby, spin!

Posted by: apodoca | Feb 13, 2010 10:16:41 PM

ChrisDJackson,

Then if he did all that, why claim he paid NY taxes for 3 years and that he was a resident of NY? Either he was a resident of NY and should have paid taxes on all his income or he made money in NY as a resident and should have paid taxes on the portion of the money he earned in NY or else he was not a resident of NY in which case he is just another carper bagger like Hillary. He needs to decide which lie to pursue.

Posted by: dick | Feb 13, 2010 10:17:20 PM

"I'm confident he will comply with all candidate financial disclosures. Period.?

That's apparently only a requirement for Republican candidates.

Posted by: Earl E. Teetyme | Feb 13, 2010 10:18:17 PM

@ChrisDJackson

If you read the article, you'll find that there is an entire paragraph explaining a possible legal tax avoidance structure. We are aware that he is hardly the only employee to take advantage such a scheme. But without your blinders, you would find that the gist of the article is clearly that Mr. Ford is not 'a New Yorker' nor has he 'been living in New York for the past three years' in the way that people typically interpret those phrases. Assuming the thrust of the article is factual, it's hard to believe citizens of that state would support his bid to represent them on the national scene.

On the other hand, Empire staters clearly have a penchant for carpet-baggers (Clinton) and tax deadbeats (Rangel). Ford's the one-two punch!

Posted by: Nate Hertel | Feb 13, 2010 10:54:20 PM

New York needs a nice little Tea Party.

Posted by: ic | Feb 13, 2010 11:13:51 PM

Chris, you don't address the entire point of the article: he said he paid New York taxes when he didn't, and he was required to. Another tax cheat.

Posted by: Deanj | Feb 14, 2010 12:18:28 AM

Tax cheat = Democrat. Even in this state, this year being a tax cheat while your party is trying to tax the rest of us to death is a killer. Ford needs to go away.

Posted by: Peg C. | Feb 14, 2010 3:53:12 AM

He'll get voted in, he has broken enough laws for liberals to be electable.

Posted by: Joel | Feb 14, 2010 4:09:15 AM

C'mon, Junior deserves some credit for being one of the few members of his family not to wind up in prison. Okay, maybe I should have said "yet."

Looks as if he's working on it.

Posted by: Memphis Jack | Feb 14, 2010 4:11:52 AM

To make matters worse there is recent New York precedence that a Tennessee resident telecommuting for a New York based employer had New York sourced income even though the Tennessee resident had little or no contact with the Empire state.

At a minimum it appears he has taxable New York income for a portion if not all of his Merrill Lynch income.

Posted by: Bill K | Feb 14, 2010 4:29:36 AM

He can just say he's always been a Yankees fan. Evidently that is enough to be elected Senator from New York. Lying about his residence and cheating on his taxes is just the icing on the cake. Paying taxes is for the peons; being paid with tax money is for our noble superiors.

I think it's disingenuous for Harold to post under the pseudonym of "Liz". Calling his critics "stupid, ludicrous, and desperate" while offering no specific rebuttal of the points laid out in the blog post really makes the case for defining critics of hypocritical, arrogant tax cheats as "haters". Stay classy, Harold... I mean, "Liz". Period.

Posted by: Phil | Feb 14, 2010 5:08:08 AM

Harold is a servant of Merrill Lynch, they hired him out of congress, when he had absolutely no experience doing anything in the private sector; they are betting that he will return to congress and return their investment.

Posted by: Memphis the Third | Feb 14, 2010 5:22:34 AM

Why, thank you for your talking points, Mr. Jackson, Nashville DEMOCRATIC County Commissioner, Chair of Lawrence County (TN) DEMOCRATIC Party, and all-around Ford gofer....

Posted by: LoneStar78730 | Feb 14, 2010 6:46:50 AM

ChrisDJackson: Are you with the Ford campaign in any capacity, direct or indirect?

Posted by: Banjo | Feb 14, 2010 7:04:01 AM

I guess you broke the ice on this one! You should start a counter on this page to see how many days it takes the press to catch the fever for holding Democrat politicians responsible for following the laws of the land. You best make sure you have at least 3 digits available on the day counter! New Yorkers really won't care because they know they'll be hitting the rest of us up to bail them out soon so they'll recoup their taxes from Tennessee in short order.

Posted by: SenatorMark4 | Feb 14, 2010 9:33:34 AM

Ask any professional athlete or entertainer about setting foot in New York for a performance and s/he, or more likely the accountant, will tell you that the state and city levy income taxes proportionate to the time spent and / or amount paid for the appearance. And the state does like to audit any and all who make a buck within state lines.

That’s one reason why one entertainer decided not to work there anymore.
http://www.rushlimbaugh.com/home/daily/site_033009/content/01125108.guest.html

Whether he runs or not, Ford needs to follow the law and file a return for years past.

Posted by: SC Mike | Feb 14, 2010 10:19:51 AM

"Harold Ford is really getting under the skin of haters..."

So Chris, anyone who takes Harold at his word that he moved to New York 3 years ago and has been paying New York taxes must be a hater to point out what you just pointed out: that Ford has maintained an office in Tennessee and did not decide to make New York their official home until 2009. Goodness Chris, you are a hater!

Posted by: willis | Feb 14, 2010 10:22:16 AM

You've got to love Harold Ford. He plants himself in a luxury apartment in Manhattan, dates someone 10 years younger than himself, rides around in limos and helicopters and decides to run for office as . . . a champion of common folk. Did I mention that he has changed positions on almost every major issue . . . in addition to not paying his taxes?

Posted by: mike livingston | Feb 14, 2010 11:30:05 AM

Just what New York State needs .... another corrupt politician who wants to raise taxes more while neglecting to pay their own.

The choice between Ford and Gillibrand is quite a conundrum..... which one nis more deceitful..... hard to say.

Posted by: L. Davis | Feb 14, 2010 2:07:23 PM

Taking a page right of out Charlie Rangel's book, I guess.

Posted by: Jeff | Feb 23, 2010 6:46:22 AM