That the Palin’s income tax returns contain significant errors should be no surprise to anyone involved professionally with the U.S. income tax system. When taxpayers like the Palins have a firm like H&R Block prepare their returns and still end up with a tax mess like this, it’s time to reform the system.
No sane human being should be expected to know how it all works. I’ve been practicing and teaching income taxes for over twenty years and I don’t. Little wonder that hockey moms and fishermen get confused. Maybe, just maybe, by putting such ordinary Americans in the White House — some who’ve been burned by the system themselves — we’ll get some meaningful tax reform.
Some Obama apologists have made much out the errors. They protest too much. I am confident that under similar circumstances, most Americans would have done the same as the Palins. I concur on all significant points with the views expressed by tax law blogger Jack Bog, including this important qualifier:
. . . no one with any credibility has suggested that the Palins have committed any fraud or behaved negligently. (The “tax cheat” headlines pouring out of the blogosphere over the last day or so are idiotic.) The Palins, who had their tax returns done by HR Block, simply got it wrong. And the fact that the state payroll office got it wrong, too, doesn’t erase the Palins’ unpaid tax liability.
Read more of Jack’s discussion at Jack Bog’s Blog. (Say that five times, fast!)
{ 38 comments… read them below or add one }
Choke. Sob. Life is SO unfair.
Did the Obama’s have H&R Block do their tax returns?
ROTFLMAO
Doran beat me to it!!!!!!
Slimy Sarah may not have had much money for some part of her life…but the last few years they certainly had enought o afford a decent accountant….evenif they had to use FedEx to send their records south to find one…..
And once again, do I want someone as VP, who can afford better and CHOOSES to use H&R Block???????
Oh come on Kurt, you and I both know you SHOULD NOT let H&R Block do your taxes. Having a mom who took a 3 week course in how to fill out a computer form is not qualified to do taxes. Man, I am just a simple soccer mom from Texas who is married to a simple computer engineer, but we know to go to a CPA!
You go to HRBlock for tax work if you have a fixed income and standard deductions. Or, if you want to avoid taxes and need a preparer who is —- uhh, not very well prepared.
Regina, what do those CAPS at the start of your post mean? I see them often but am so out of style I don’t know their meaning.
Rolling on the floor laughing my (butt) off.
txmom77 –
Baloney. There are plenty of bright people who work for H&R Block. You’re stereotyping — just the sort of thing that you deplore when Texas CPS does it to the FLDS.
The name of the firm and $$ you pay have next to nothing to do with the expertise or performance of the tax professional. I’ve found huge errors in tax returns prepared by the top firms. Some of the best work I’ve ever seen is done by a local guy who works on his own, doesn’t have a website or a firm.
Your swipe at H&R Block is more than rude. It’s defamatory. And it’s beneath you unless you have some evidence — besides Sarah Palin’s return — that H&R Block is worse than others who perform the same service.
Txmom77 –
One more thing. If you’re so sure that you’re getting quality work done by your CPA (this acronym means “Can’t Pass Again”), send me a copy of your return. I’ll bet you a steak dinner (or tofu or whatever you like) I’ll find errors running in both directions in your return — you will have over and underpaid.
And the same goes for Doran. You can laugh at the Palins once you’ve exposed your returns to the entire world.
Exposing returns are one of the ways we “vet” Presidential candidates. Which I am not.
You’re right. You’re not. And since you’re not, you’re in no position to guffaw about the tax returns of those who have risked their credibility to become candidates.
Give me an hour with your return, and we’ll include you in the tax return comedy routine. And then everyone will guffaw at you. He who laughs last laughs best.
Now, if you want to talk about charitable contributions as a signal of “where the heart is,” I’m with you. Joe Biden may have the smallest heart of any living American politician. The Palins are just average, not impressive by any means.
But I won’t for a minute go laughing about mere errors in tax returns. They’re ubiquitous. And they’re no laughing matter because they’re a sign of a corrupt, complex tax system that has no credibility.
No, Doran, even if you had the qualifications to run for VP, you lack the courage (not to mention the critical thinking skills).
Your game is all about slamming others, without basis, and then refusing to back-up your attack with evidence.
When someone asks you to back up your stand, you reply with something like “I don’t feel obligated”.
Your arguments, in all topic areas, are almost all “Straw man” and/or “ad hominem” based.
Do you feel bigger when you do that?
“You go to HRBlock for tax work if you have a fixed income and standard deductions. Or, if you want to avoid taxes and need a preparer who is —- uhh, not very well prepared.”
Doran, can you provide anything to substantiate this attack against H&R?
I do our taxes and then send them to my former CPS boss who goes over them and checks them, so far I haven’t overpaid or underpaid!
I worked for H & R block! I took the class and I did the tax returns (at Sears!! ) and if it’s simple and easy, they do a great job. It’s basically inputting information into the computer as it asks you questions. I am not qualified to do really complex taxes. I can’t stand H & R Block because lower income families usually were the ones coming in who basically need a 1040 EZ and I am charging this person $200.00 and then talking them into the “quick loan” so they can get their money now, I am only taking 18% when I know that they could have their money in less than 10 days, but I am not allowed to tell them that. I also worked for an accounting office in Provo ( I put hubby through college, and they paid better than the Provo School District) and once again, I can do the simple and easy stuff, but I know better than to try the complex stuff. I can tell you horror stories of the H & R Block in Utah and California.
If you have something that is hard and difficult, you go to a CPA who knows what they are doing. If you have simple deductions and or the standard deductions, heck you can do it yourself with TurboTax (which is Intuit, which is what the professional CPA’s use) and call it good, and save yourself a big chunk of your return.
But a governor of a state with lots of complex things, should be going to a CPA.
Oh, and I am from Texas…. what the heck is tofu!! LOL Bring on a steak dinner anytime!! LOL
Yeah, the Palin tax return. C’mon. Why would wealthy people like them go to HRBlock? The tax consequeces of so much of what people do are so important that it really does require a CPA with expertise in that area of tax law. You don’t take a complex tax matter to someone without the specialized knowledge to deal with it. Unless……
“In 2006, the Palins paid $11,944 in taxes on $127,869 in income. In 2007, they paid $24,738 on $166,080.” (cp from the common room)
I hardly call $127 k or $166k income wealthy. Is it wealthy in your neck of the woods? Cost of living must be wonderful there.
Sarah Palin was elected Governor in 2006. Hence the jump in income for 2007.
I know many people who own their own small businesses who do not use a CPA, but rather TurboTax or H&R block. I don’t think any of them are trying to cheat the government (well maybe one or two), they want to file an accurate return, without sending up any red flags for IRS audit. I don’t hesitate to guess that you could take any of their returns and find errors in them, simply because the tax code is too complicated. I would guess that an IRS auditor could find an error in any return that is not the 1040EZ form - and probably half of those are wrong somewhere too! And two IRS auditors looking at the same form would probably not find the same errors.
“You go to HRBlock for tax work if you have a fixed income and standard deductions. Or, if you want to avoid taxes and need a preparer who is —- uhh, not very well prepared.”
Doran, can you provide anything to substantiate this attack against H&R?
Still waiting, Doran.
Doran-
ROTFLMAO
rolling on the floor laughing [redacted]
Txmom77 –
Your experience with H&R Block isn’t universal. You don’t know a thing about why the Palins chose to have their return done there.
And I don’t give a hang who does your tax return. Show it to me and I’ll find errors. And if I don’t, only then will you earn the steak dinner and right to laugh — like so many other elitists — at the Palins for picking a low-brow outlet to do their tax returns.
The husband said that I am not to send anything to some strange guy on the computer.
Are you calling me an elitist? I am a SAHM of three kids who coupon clips , budgets, and shops on sale so that I can be home with them.I grew up the daughter of a single mother who was a cleaning lady, and had student loans pay my way through college. I should love Sarah Palin, I am anti gay-marriage, I am pro-life, my BIL is in Iraq, but for some reason she scares me and I can’t connect with her. I like McCain (always have and was upset when he lost the primary in 2000 to Bush), but his running mates scares me to death. Why couldn’t he have just picked Mitt Romney and made my decision an easy one.
I am not laughing at the Palins for choosing H & R Block, but I do think it was a stupid mistake. She has very complex tax issues and she should have used a CPA. I don’t think she trying to screw the government, but it was a mistake in what she is dealing with in your words “an absurd tax system”
I work in the financial world. (and I am still of two opinions on the need for a “bailout”). Two years ago I used two different products to compute my relatively easy taxes. They came up with different answers.
The company I work for used a big name accounting and audit firm to do their taxes for the 2 of the past 3 years after using a local smaller firm for the 3 years previous to that because we felt we had gotten too complicated for the local firm. This past year we hired a smaller firm that is even more specialized in our field. This smaller firm has found that the big name firm blew it and we are due back over $80K.
My parents used a local CPA to do their taxes because neither they nor I could figure out the taxability of some of their retirement income. They were audited by the state this year and told their CPA blew it and they owed several hundred dollars in taxes.
Taxes are complicated no matter what you do and no one is guaranteed to get it right.
Cosmo, I responded: The Palin tax return, as well as Kurt’s comments, indicate either that the preparer was not really prepared to do that kind of work, or that Gov. and Mr. Palin use the GIGO accounting system when reporting income, or both. In any event, this was not an “attack” on HRBlock.
Txmom77 –
OK, well, the fact that you’re not willing to share suggests that one of you isn’t so confident about what’s in the return. I’m not some “strange guy on the computer”.
I’m a CPA/attorney, former Price Waterhouse tax consultant, now a tenured professor of accounting & business law who regularly teaches advanced taxation at an AACSB-accredited business school with the largest MBA program in the Southeast.
You “know” it was a mistake to choose H&R Block because you have inside information about the company. So it’s easy for you to label it a “stupid mistake”. But how stupid in comparison to Barack Obama choosing to tie his star to Jeremiah Wright, Franklin Raines and Tony Rezko? And which mistake — Palin’s or Obama’s — means more in terms of presidency-relevant judgment?
“Or, if you want to avoid taxes and need a preparer who is —- uhh, not very well prepared.”
Not an attack on H&R?
For one H&R office, after answering a few questions to define my needs, such as: do you own a house, are in the military, do you own a business, do you have any stock investments, here are some of the profiles for the “tax expert” profiles that came up:
“Areas of Expertise: Sole Proprietorships, Partnerships, Sales, Capital Gains, Rentals, Depreciation, Itemized Deductions, Retirement and Social Security.”
“Areas of Expertise: Complex Individual Returns and Business Entities”
“Areas of Expertise: Self Employed Taxpayer, Rental Real Estate, Employee Stock Options, Dispositions of Business or Personal Property, Military or Retired Taxpayer, Allstates, and many other areas as well. ”
To me, it looks as if H&R handles more than just straight forward taxes.
I’ve never opted to use H&R because they are expensive, and I don’t have a need to have my return instantly…or at least I don’t want to give up a chunk of my return to get it instantly. And, because I have two brothers who are CPA’s, I guess I prefer a private CPA. But, that is no reason someone else with complicated taxes should be considered to be stupid because they use H&R Block.
“The hardest thing in the world to understand is the income tax.” – Albert Einstein
Besides, “Our system is a voluntary system” - Harry Reid
http://www.youtube.com/watch?v=R7mRSI8yWwg
Someone with a lot more time than I have for such things, could go to one of the legal research sites, or the bankruptcy sites perhaps, and just check out how many lawsuits Block, Price Waterhouse, etc., have been the past decade.
Ohh c’mon, Kurt. To all of us you’ll always be that strange guy on the computer.
http://www.youtube.com/watch?v=SDKcwytKkrY&feature=related
“You know it was a mistake to choose H&R Block because you have inside information about the company.”
Txmom77 has information about her experience with H&R Block inside Sears, but an H&R Block inside Sears is not going to be a full service H&R Block. Just as the JCPenney Portrait Studio is not the full representation of Lifetouch Portrait Studios. When compared to all the company offers, the department store location is really like a kiosk on the mall floor. The Sears locations, according the H&R employee I just spoke with, are seasonal offices, only open during the official tax season, which wouldn’t offer a full view of all the company is capable of. The “premier” locations are open year round and do complex tax preparation and provide year round tax services to businesses of all sizes.
There you go again, Doran! You consistently make negative claims—all over this blog, without offering anything to substantiate them, and then you say you don’t feel obligated or you offer some other cop-out.
If you don’t have time to research the allegations you make, then don’t make the allegations in the first place. If you can’t provide something to support your attacks, then keep your mouth shut.
You have time for drive-by shootings, but you don’t have time to stand trial!
Wonder just how many “prmiere locations” H&R Block has in Alaska…
According to their Website, there are two year round locations in Wasilla, one in Palmer, one in Eagle, and one in Anchorage.
Doran –
You could check to see how many lawsuits have been filed against H&R Block and PW. But that wouldn’t tell the whole story. There are so many blown tax engagements that never reach the lawsuit stage. Many nowadays are settled privately out of court through arbitration.
Some big cases go public — if for some reason the tax advisor wasn’t able to get an arb clause into the engagement letter — and when they do, they’re most often filed against the really big firms. Big firm, big mistake, deep pocket lots of trial lawyers anxious for a piece of the action.
But I see no justification for tagging H&R as somehow per se “worse” for Palin’s tax returns than KPMG or PW. Neither of the returns — 2006 or 2007 — is that complicated. And, in fact, there’s no apparent reason why any preparer would have a reason to dig behind the W-2s as delivered by the State. So I don’t think it’s fair to tag H&R for doing a bad job on that aspect of the tax return unless the Palins had occasion to raise questions about the State allowance thing.
I will confess that the amounts deducted by Palin for tax prep fees are unusually low — at least in my view — in light of the Schedule Cs.
I also find curious something I’ve not seen mentioned elsewhere. In the 2006 return, page 18, the Palins report FMV of $1,000 for donated items with an adjusted basis of $400. It’s possible that donated items like this might have risen in value over the taxpayer’s holding period. If so, it would typically be some kind of investment-grade asset like diamonds, paintings or antiques — not the kind of stuff I imagine the Palins buying. But who knows?
Has everyone noticed how Cosmo, Kurt and some others have cratered on the Palin tax return issue and are now taking up your time with defending HRBlock and name-calling?
Doran-I think it started with you implying that Sarah Palin was either stupid in choosing to go with H&R Block or that she was trying to find someone who would be unable to see that she owed money. I know you didn’t use those words, but that was the implication. What Kurt, Cosmo and others have said since then in defense of H&R Block and Palin started with your unfounded insinuations.
“If so, it would typically be some kind of investment-grade asset like diamonds, paintings or antiques — not the kind of stuff I imagine the Palins buying. But who knows?”
Could be guns? They appreciate in value.
Gee, let’s talk about all the money obama gets from overseas. Or maybe, from someone named (not the name, but I can’t remember) good will, or his emails from odinga (that Sean talked about today) or on and on. They surely would be more interesting unless your saying that “lovely Sarah” was cheating.
It’s too bad that you can’t recognize a sincere woman, regina, or doran. Smart, CUTE (I know you hate that), looks good in a skirt and high heels, and wears lipstick, is married to the same man all these years and has never had an abortion (as one of the left wing wingydingys complained). Imagine that! I don’t know anyone I know who has ever had an abortion, but I guess I’m not up on that.
Sorry, Kurt, I’m bored with taxes.
“Has everyone noticed how Cosmo, Kurt and some others have cratered on the Palin tax return issue and are now taking up your time with defending HRBlock and name-calling?
Weren’t the Palin Tax Return Issue and H&R Block connected?
Where did I call names?
Cayuga –
No need to be sorry. Taxes are boring. I try to spend as little time as possible on them.
What’s this about “name-calling” and “cratering”? “Useful idiots” isn’t a name. It’s a term of art. Some people just don’t have a sense of humor. And Obama happens to be one of them.