Palin’s Lawyer Defends The Governor’s Tax Returns
Earlier today, Governor Sarah Palin released her tax returns. It turns out she makes a little more than most “hockey moms” but she’s no Joe Biden. TaxProf Blog breaks down how she stacks up to the other Article II contenders:
Gov. Palin’s charitable contributions do not approach the 10% tithe required by her evangelical church, but they are in line with the average charitable contribution of Americans with her income and they are over ten times greater (on a percentage basis) than Joe Biden’s miserly charitable contributions.
But Paul Caron was also right on the money about another issue: Palin’s failure to report her per diem reimbursement she received as governor of Alaska. Both the New York Times and the Washington Post have mentioned these reimbursements before.
Palin tonight responded with authority to these allegations. The campaign released a letter (pdf) from D.C. tax attorney Roger M. Olsen:
Unless employees have reason to know that the W-2 is incorrect, the IRS expects employees to rely on the employer’s W-2 as prepared & filed with the IRS, as Governor Palin did. The income tax aspects of fringe benefits are complex and highly technical, and not subject to second-guessing by laymen. The State of Alaska is confident that its position is correct. Its employees were entitled to rely on that determination, So was Governor Palin.
Sounds like Olsen just called the liberal media “TTT.” Caron points out that Olsen is more qualified to speak about Palin’s tax returns than your average cable news anchor:
Mr. Olsen has a tax LL.M. from George Washington and is a former Assistant Attorney General of the Department of Justice’s Tax Division under President Reagan.
Are there any uber-qualified attorneys that would like to support the Olsen-Palin position? Or stand opposed?
Gov. Palin Releases Law Firm Opinion Letter Justifying Her Not Reporting Per Diem Expenses as Income [TaxProf Blog]
Palin Releases Tax Returns and Financial Disclosure Forms [TaxProf Blog]
Roger Olsen Letter (pdf)
(32) 
Comments
Comments hidden for your protection. Show them anyway!
sadly, first
A tax LLM from GW? Wow, even worse than a GW JD.
God you are a pathetic partisan shrill who is determined to destroy this site. I truly hate you.
*nearly completes mail merge for 1L sa position, 3K a week here i come!*
-nervous T-10 1L
FifTTTh
This is an easy income tax question. Any 1L/2L taking an income tax class could have answered this problem. Yes, the IRS usually relies on employer's W2 forms. That's for administrative convenience. For the most part, the IRS doesn't want to audit every employee's fringe benefits, which would be an incredible waste of tax dollars. That being said, the governor, with all her qualifications and knowledge regarding the U.S. system of governance, should have known that a per diem (worth how much over the last 18 months?) should be included in her tax return. If my employer reimbursed me for tens of thousands of dollars (for what expenses?), I would at least think about whether this was income.
Giver her anti-tax position, its not that surprising.
1Ls taking income tax...TTT
Wait... you're supposed to report W-2 income?
zzzzzzzzzzzzzzzzzzzzzzzzz......
"We want to take money."
- Joe Biden
Guys at my highschool used to confuse the names of DC area law schools with different advanced degree programs all the time, it was no big deal.
The thing that's funny about it is that, as Governor, she is ultimately responsible both for her own tax return AND the fact that the state issued erroneous W-2's.
Furthermore, it reflects bad judgment for an individual with sophisticated financial dealings (business owner, Governor) to rely on H&R Block for their tax returns (in my personal opinion).
LULZ. Sure, I'll stand opposed.
my w2 lists per diem as misc non-taxable.
My W-2 lists Elie as a communist who I have to give money to under Obama's welfare, er, tax plan.
You'd prefer trillions in welfare to foreign countries after we bomb the piss out of them?
MysTTTal at the brainless partisin politiking again!
YES WE CAN FIRE ELIE.
So if Palin would be on the cover of Vogue if Elie were making the rules, what magazine would Biden be on? Reader's Digest?
What about Obama?
elie, i am a big fan of yours, and i'm also a big fan of obama. but can you not use that picture of palin? i don't like palin, but the picture is offensive. attack her for her stupidity, her lack of qualifications, but i don't think you need to put her on the cover of vogue in a plunging cami.
i am not clear here....caribou barbie was billing her state a per diem to stay in her own home????
sounds unethical dontcha think?
you darn tootin it is....
"*nearly completes mail merge for 1L sa position, 3K a week here i come!*
-nervous T-10 1L"
YOU ARE SO ANNOYING. PLEASE. DIE.
The answer is probably that Palin is civilly responsible for underreporting income and underpaying taxes, but is not criminally responsible.
Criminal tax violations require "willfulness". In the criminal tax arena, the Supreme Court has interpreted that as a pretty tough standard -- approaching actual intent to violate a known obligation. See Cheek v. United States (1991). But a taxpayer is civilly liable for taxes whether or not she knew or had reason to know of the liability. (You're still liable even if you relied in good faith on your accountant; even if you thought you didn't have to pay; even if you made just a math error). And the IRS can require payment of back-taxes for whatever years are still within the statute of limitations, which almost certainly would include Palin's limited time as governor.
So to the extent Olsen is simply saying that Palin won't be criminally prosecuted, he's right. To the extent he's saying that the IRS would believe Palin current on her obligations, he's wrong -- she's going to have to file amended returns and send in a check.
Nervous T-10 1L - I'm a partner at a firm that you're most likely hoping to work at. I pray to God that you end up here and I find out who you are. I want to crush your dreams.
Roger Olsen mainly deals in criminal tax matters. Generally, you need to knowingly fail to report or pay tax in order to be criminally liable. A criminal tax prosecution is one of the few places where ignorance of the law is a solid defense. (Not technically a defense, but it refutes the prosecution's prima facie case). So, if she claims ignorance and says she relied on a W-2, the DOJ won't have a chance in hell of conviction unless they somehow show that she actually did know the law. So, unless they uncover that she secretly has an NYU tax LLM or someting, they can't convict her. If they found out that she secretly had a GW tax LLM, she should still be fine.
She will still owes the back taxes together with penalties and interest. Since state tax is usually determined with reference to federal taxable income, she probably also owes Alaska some back taxes, penalties and interest.
Plummeting home prices. Creeping inflation. Tightening credit markets. Sinking stock prices. A country on the verge of the worst economic collapse in more than seventy years. And folks really think this is a good time to turn over the keys to the White House to a black guy? I mean, seriously, they're joking, right?
Elie,
For god's sake, please spare us your hackneyed political posts. Your pathological inability to refrain from inserting personal politics into this site has cheapened it immeasurably. You don't like McCain-Palin. We get it -- in point of fact, we could care less. This is (was) a respected legal blog. Just stick to that -- we can all find MUCH more insightful, informed political content elsewhere.
TaxProf Blog is wrong when it says that "Gov. Palin's charitable contributions do not approach the 10% tithe required by her evangelical church." The Wasilla Bible Church does not require either its members or guests to tithe 10% - giving is voluntary.
TaxProf Blog is wrong when it says that "Gov. Palin's charitable contributions do not approach the 10% tithe required by her evangelical church." The Wasilla Bible Church does not require either its members or guests to tithe 10% - giving is voluntary.
Hey Elie, here's a law-related story I bet you won't be posting on any time soon:
http://query.nytimes.com/gst/fullpage.html?res=9B0DE3DB143FF93BA2575AC0A961948260
Hey Elie, here's a law-related story I bet you won't be posting on any time soon:
http://query.nytimes.com/gst/fullpage.html?res=9B0DE3DB143FF93BA2575AC0A961948260
Biden gave something more valuable than money as a charitable contribution, he gave his time. that doesn't show up on a tax return.
@30 Nice try. If we're going to start going back ~20 years let's try this one on for size:
http://query.nytimes.com/gst/fullpage.html?res=9C0CEFDF173DF934A25752C1A966958260