By the time this election is over, Sarah Palin may run up quite a tax bill. She's already likely to owe back taxes on her per-diems, and now the tax blogs want her to pay taxes on clothes and makeovers bought for her by the campaign.
As far as the clothes go, if she gets to keep them, she's taxable on them. If she doesn't, she has a pretty good argument that they are no more taxable than costumes worn by actors or outfits worn by models -- an argument that even anti-Palin partisan Linda Beale acknowledges. And what is politics but an act? I suspect that a campaign operative right now is writing a letter for the file saying that the clothes are just on loan.
Why hasn't this argument come up for other candidates? For the men it doesn't come up because all a man needs is a dark suit, a clean shirt and a subdued tie to look presentable.
For women, it's a lot more difficult and expensive to put together outfits when you are going to be on TV every day. The other women we've seen most often in this election season - Hillary Clinton, Cindy McCain, and Michelle Obama - are rich, and they can afford expensive outfits. So if you are going to run for office without a Y chromosome, make sure you have a lot of money first, because otherwise the tax bills will be a killer, if Beale & Co. have their way.
The items included in the Tax Update Blog are informational only and are not meant as tax advice. Consult with your tax advisor to determine how any item applies to your situation.
Joe Kristan writes the Tax Update items, and any opinions expressed or implied are not necessarily shared by anyone else at Roth & Company, P.C. Address questions or comments on Tax Updates to