Are the Palins tax cheats?

October 6, 2008, 3:19 pm

Questions Linger About Palin Taxes

By Leslie Wayne

Now that tax attorneys have had a chance to review Gov. Sarah Palin’s tax returns, which were released late last week, a new round of questions are being raised on tax-related websites.

One big issue that tax attorneys are pointing to is the fact that the Palins did not report as income the $43,490 that the state gave the family to cover travel expenses for Mr. Palin and the Palin children. Had the Palins reported these payments as income, the couple would have had to pay taxes on it.

These tax attorneys note that neither Mr. Palin nor the children were employees of the state. Nor were they traveling on behalf of the state. There was some discussion that perhaps some portion of Mr. Palin’s travel expenses might be excludable as income if there was a bona-fide business reason for his presence and if he assisted Mrs. Palin in her official duties.

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So if that is the case, how much might the Palins owe? Mr. Bogdanski said that, at the least, the family should have reported the $24,728 in children’s travel reimbursements. He calculates a tax bill of $6,000, based on a tax rate of between 25 and 28 percent. There would also be additional interest payments since last April 15.

The other area attracting attention is Mr. Palin’s snowmobiling racing and whether it is a legitimate business (which allows the Palins to deduct snowmobiling expenses) or whether it is a hobby, for which no deductions will be allowed.

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