Palin's Tax Return Missing Travel Reimbursements

[maddezmom]

Palin's Tax Return Missing Travel Reimbursements
by Peter Overby

NPR.org, October 4, 2008 · Vice presidential candidate Sarah Palin didn't report thousands of dollars in state travel reimbursements that she collected while living at home last year, according to her tax return for 2007.

As governor of Alaska, Palin collected per diems for scores of nights spent in her own home and working at a state office in Anchorage rather her office in faraway Juneau, the state capitol. The patterns varied, but the state paid her, on average, $890 a month, according to The Washington Post, which first reported the payments.

Although Palin and her husband paid 20 percent of their income in taxes last year, the per diems don't appear on their 2007 tax return.

The McCain-Palin campaign, which released her 2006 and 2007 returns, said Palin was in compliance with state policies and the reimbursements weren't taxable income.

more:http://www.npr.org/templates/story/story.php?storyId=95397464

[ejpoeta]

1. i don't understand what 'per diems' are in the sense that

are they income or reimbursements? it sounds fishy to me. that may be how they do things in alaska, but the rest of us have to declare our income and pay taxes on it.

[POAS]

2. If I understand IRS rules

(who am I kidding, nobody really understands them) if you are making out of pocket expenditures and are reimbursed it is not income. Now getting a per diem for staying home might raise questions at the IRS.

Think about someone with a home office doing work for their employer from home. The cost of maintaining that office would be deductible from the taxes on their income. But what is their employer pays them to maintain that office? Would the reimbursement be considered salary?

I hafta stop my head is starting to hurt and we aren't even close to tax season yet!