Palins' Tax Returns For '06-'07 Released

Underpayment Of Estimated Taxes Shown, Controversial Per Diem Income Ignored

(AP)  Sarah Palin is the breadwinner and husband Todd is, well - he takes a lot of deductions for his fishing and snowmachine racing careers, according to 2007 and 2006 federal tax returns released Friday.

Sarah Palin makes $125,000 a year as Alaska governor. Plus, since she took the job in December 2006, she hasn't paid taxes on the more than $17,000 she received in controversial per diem payments for working out of the family's lakeside home in Wasilla - some 575 miles from the capital of Juneau.

For the 2007 tax year, Todd Palin's self-employment brought him $66,893 in gross receipts - $49,893 from fishing and $17,000 from snowmachine racing. But, the returns show, he claimed so many deductions that he reported only $15,513 net profit from the fishing operation and claimed a $9,639 loss from his racing, leaving him with an overall net income of only $5,874. In addition, Todd earned $43,519 last year working part-time on the North Slope for BP Exploration.

The self-employment deductions left the Palins, who have four dependent children, with a 15 percent tax rate for 2007 and a rate of less than 10 percent for 2006. Todd Palin also deducted for the business use of their home in Wasilla. A fifth child was born to the couple this year.

An Associated Press analysis of the returns released by the McCain campaign also reveals that the Palins underpaid their estimated taxes with an April extension and likely owe interest.

Todd Palin offset his $17,000 gross receipts for snowmachine racing by claiming $10,858 in depreciation, $2,425 for car and truck expenses and $1,559 for supplies. An additional $11,405 was claimed for "other," which included fuel, entry fees, equipment parts, repairs and maintenance, cell phone, memberships, "sponsorship apprec" and "gear."

The governor's husband claimed $34,380 in deductions for his fishing business - more than two-thirds of the gross receipts. He claimed $12,245 in crew share payments, another $2,953 for car and truck expenses, $5,866 for depreciation, $4,181 for supplies.

When he was on snowmachine duty, he claimed $192 for travel and no deductions for meals and entertainment. While fishing, he claimed $2,194 for travel and another $680 for meals and entertainment, which is deductible at 50 percent of cost.

On the 2006 return, Todd Palin had total receipts from the fishing and snowmachine racing of $48,082, but after deductions his net income was $10,164.

Sarah Palin was only governor for one month in 2006, and Todd Palin earned $102,716 working for BP Exploration, a post he says he's temporarily left.

"This is a lady who screams about everyone in federal government taking advantage, and she's taking every advantage she can," said Sheldon Cohen, IRS commissioner in the Johnson administration. "They are milking every possible deduction. They have a right to, if it's legitimate. The question is, is he in the racing business or is it a hobby?"

Robert Cross, first vice president of the National Society of Accountants, said the Palin business deductions were "typical middle America, John and Jane Plain," but he felt they would definitely owe interest and "possibly a small penalty, depending on all the circumstances."

An underpayment noticed by the AP could lead to interest charges against the Palins but probably not penalties.

On an undated extension form filed with a $2,000 check dated April 11, the Palins claimed an estimated tax liability of $22,721 and total withholding payments of $20,721. The attached check meant the couple believed they had paid all of their taxes for 2007, as required. However, when they filed their taxes last month, dated Sept. 3, their tax liability turned out to be $24,738 - meaning they owed an additional $2,017.

IRS rules require that when a taxpayer files for an extension in April, all outstanding taxes must be paid at that time.

When asked if the Palins had paid any interest or penalties, and if so, how much, Maria Comella, a McCain-Palin spokeswoman, said the couple had paid "at least $2,017," and that the campaign was researching if an additional payment had been made.

"In April, they made a reasonable estimate of what they would owe, and they underpaid," she acknowledged.

"They're going to be billed the interest," said Cohen, who has contributed to the Obama-Biden campaign. He said the Palins would likely avoid penalties because their tax payments as of April for last year were higher than all payments made the prior year.

Overall, the 2007 return shows that last year the couple had an adjusted gross income of $166,080 and paid $24,738 in taxes - about a 15 percent rate after deductions. In 2006, the records show, the Palins earned $127,869 as adjusted gross income, with taxes paid listed at $11,944 - less than a 10 percent rate.

On federal financial disclosure forms, also released Friday, Palin and her husband listed assets worth from $960,000 to $2.3 million. Because the values of assets are reported in broad ranges, it's not possible to calculate an exact value for their holdings.

Like many Americans, their most valuable asset is their home. Theirs, in Wasilla, is valued at $500,000 to $1 million. According to the Matanuska-Susitna Borough, the land and structure are appraised at $552,100.

Their next most valuable asset is a fishing leasehold, worth $100,000 to $250,000. Todd Palin's fishing business was valued at $50,000 to $100,000, and his snowmobile racing enterprise was put at $15,000 to $50,000.

Todd Palin also has a retirement account worth $50,000 to $100,000, and he owns a variety of mutual funds in a 401(k) retirement plan through his employer, the oil company BP. Sara Palin also has retirement accounts from the state of Alaska and the city of Wasilla, where she was once mayor, valued at $115,000 to $250,000.

The Palins also own shares of two land parcels worth a combined $51,000 to $115,000.

On their tax returns, the Palins said they donated $8,105 to charity over the two years. The bulk of the donations came in "gifts by cash or check" - $4,250 in 2006 and $2,500 last year. Comella said the Palins gave the money to local churches, but she would not elaborate.

The Palins made noncash charitable contributions, claiming "thrift store value" of $825 for a Dec. 31, 2007, donation to the Salvation Army of Wasilla.

The column used to describe the donated items states only "Wasilla Alaska." When asked to explain, Comella said, "I believe this is actual things that were part of their property - furniture, clothing and so forth. That was generally what they donated."

For the 2006 tax year, the couple listed two noncash donations of "crib," household goods and clothing to the Salvation Army of Wasilla, with a fair market value of $1,000, and more goods and clothing, with a fair market value of $230. While the value of the two donations total $1,230, the tax return only claims $630.

Asked to explain the missing $600 on the actual return, Comella said that figures in two columns had been reversed - that the $1,000 was actually the donor's cost and the $400 listed under that category was actually the fair market value. That would make the total donation the same $630 listed elsewhere on the Palin return.

"It was a typographical error that didn't change any of the main numbers," said Comella.

More recently, the IRS has tightened documentation rules for all charitable contributions.

Regarding the per diem dispute, Comella said Juneau is the governor's home base and therefore whenever she works elsewhere, she is entitled to charge the state. Comella contended the per diem payments are not taxable.

Cohen said it was fine for the state of Alaska to determine it was OK to reimburse Palin to work out of her home, but the state's decision didn't mean those benefits were not taxable by the federal government. "One has nothing to do with the other," said Cohen.

[oonagh1]

Why would Todd pay taxes to the USA? Where are his principles? He wants an independent Alaska. Our Sarah sleeps with a traitor.

[mbourn2]

I thought this was someone''s idea of a joke until I found the story on CNN. (see link below).. This is very telling if this is true.
--------------------
What do the top ten cities with the highest poverty rate all have in common?

Democrat leadership.

Detroit, MI (1st on the poverty rate list) hasn''t elected a Republican
mayor since 1961;

Buffalo, NY (2nd) hasn''t elected one since 1954;

Cincinnati, OH (3rd)...since 1984;

Cleveland, OH (4th)...since 1989;

Miami, FL (5th) has never had a Republican mayor;

St. Louis, MO (6th)....since 1949;

El Paso, TX (7th) has never had a Republican mayor;

Milwaukee, WI (8th)...since 1908;

Philadelphia, PA (9th)...since 1952;

Newark, NJ (10th)...since 1907.

Einstein once said, ''The definition of insanity is doing the same thing over and over again and expecting different results.''


http://www.cnn.com/2008/POLITICS/08/20/beck.cities/index.html

[usclimey]

Personally I like the idea that POTUS should be the smartest person in the room. As far a McShame/Falin are concerned that is only achieved when the room is full of chimpanzees (and that might be a insult to chimps).

[kaiyo4u]

Hey folks, since when do you pay taxes on per diem. Per diem is paid as reimbursement for out of pocket expenses for being away from where you normally work. I have never paid taxes on per diem.., nor do you have to, unless they just changed the laws and made them retroactive.
This article is slanted as far as their view of taxable income... My ex used to declare so many deductions (and probably still does) that "our" net income was under $15,000 in the ''90''s .
I know how to play the numbers game too, that''s why being in business for yourself can be lucrative.
So please, until you have actually done the tax math yourself for your business, please don''t insinuate anything. It only makes you look gullible...

[lordmi]

to mmstar20 : McCain is sitting on Cindy''s beer.
Obama earned with his brains.
So, I guess his NEt is so much better, that old ruin can not be even compare with him , as he has so huge Gap in brains.
I guess - it matters.

[lordmi]

hey, she is like me!
So I guess, i also should skip Fed Tax , as she considered that would be very patriotic.

[sbelknap01]

The Palin''s need to be audited, seriously. I think it''s probable that his snowmachine racing is a hobby, so no loss would be allowed. I see no reason why her $17000 per diem isn''t listed as taxable income and then deducted properly on her form 2106 and Sch A, like yours and mind would be. And Todd can''t take a home office expense on a business running at a loss so it must be for his fishing business and the rules for claiming such are very tight indeed. Unless he''s fishing in the living room that deduction may well be disallowed. AUDIT!

[harbinger09]

There is a new Poll on PBS about Palin being qualified for VP. The RNC got word of it and has had supporters inundate the site with yes votes for Palin. This poll is to be broadcast on the major networks later. it is not a scientific poll but an electronic poll--if you have an opinion about whether Palin is fit to be President or not--go to this link, also email this link to anyone who you think has an opinion on Palin.

1) Click on link and vote yourself. Here''''''''s the link:
http://www.pbs.org/now/polls/poll

-435.html

and cast your vote

[mccainisevil]

MY HOLIDAY WITH JOHN McCAIN

http://myblogthebword.blogspot.com/2008/09/my-holiday-with-john-mccain-it-was-just.html

A MUST READ - THIS GUY IS AS SICK AND CREEPY AS IT GETS!!!!

"McCain''s appreciation of the beauty of Asian women was so great that David the American economist had to move his Thai wife to the other side of the table from McCain as McCain kept aggressively flirting with and touching her. Needless to say I was irritated at his large ego and his rude behavior towards his wife and other women, but decided he must have some redeeming qualities as he had adopted a handicapped child from Bangladesh. I asked him about this one day, and his response was shocking: "Oh, that was Cindy''s idea - I didn''t have anything to do with it. She just went and adopted this thing without even asking me. You can''t imagine how people stare when I wheel this ugly, black thing around in a shopping cart in Arizona .

[kellyanne5]

Us females feel Palin is an Anti-Christ, and doesn''t speak for us. She is just a gold digger. post you''re comments at www.theseriouspolice.com

[erasmus81]

I have said this before but once the election is over and the Palin''''s go back to Alaska, they will find that the run for VP is the worst decision they ever made!

Posted by HSinCO at 09:31 AM : Oct 05, 2008

I agree. I bet she isn''t going to look as good as she used to, to all her fellow Alaskans.

I feel sorry for her family.

[mmstar20]

WSJ yesterday had totals for Obama, Biden and McCain''s tax returns from last year. Interesting to note that Obama made more last year than McCain....whose rich bashing now?

[eroosevelt08]

Another politician who figures out how to avoid taxes? It is interesting that the McCalin-Palin ticket is trying to smear Barack Obama now. I do recall that it was Senator McCain who came back from being a POW and dumped his crippled wife Carol, who had been a model before her horrible 1969 car accident. While stationed in Florida in 1976 he had extramarital affairs. He met Cindy McCain in April of 1979. He filed for divorce in January of 1980 and married Cindy McCain in May of 1980. Carol and John McCain had been good friends with Nancy and Ronald Reagan, which friendship cooled when they learned about Cindy. Read McCain''s biography. It is all there on Wikipedia.

[koalabeer1]

Whenever I see this woman, for some reason, the word "tommyknocker" springs to mind.

"Late last night and the night before,
Tommyknockers, Tommyknockers, knocking at the door..."

[sparkbox]

The greatest tax cheat is our own federal government.
Zero accountability for our tax dollars.
Enormous earmarks on the "hurry we must pass the 700 billion dollar bailout plan or God will die" to the tune of another 100 billion plus. We are constantly bombarded with these crisis scenarios to keep us in line. I pay about $1500 a month on fed. tax and they want more? Enough is enough.

[jerr11]

If we said this about Nobama they would have his newly formed hit squad sueing you.

Posted by stick1771 at 11:51 AM : Oct 05, 2008



Yeah a few exaggerations in there, but don''t blame me, I''m just taking a page out of the republican playbook.

If you say it enough times, they will believe you.

Right swiftboat liars?

[jerr11]

The Palins - Tax evasion, a gigolo husband, a knocked up teenage daughter - just another typical trailer trash family.

And looks like that Playboy photoshoot will be taking place soon.

That should please the base, esp Rich Lowry.

[Gorevidal]

mjoseph1958,

Very nicely done. Felt like a Harpers piece.

[heartlandjim]

She says she fought Big Oil. Well Golly Gee her husband works for big oil!!

[heartlandjim]

Money for staying in her own home? That''s not right; I don''t care how many tax codes you quote. It''s unethical!! Shame on the Palins.