Posts tagged as:

president

Ask the taxgirl: The President and Income Taxes

May 20, 2009 · 2 comments

Five_US_Presidents.jpg

Taxpayer asks:

Does the President have to pay income tax?

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I get that question a lot. And this week, I also received this question:

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Taxpayer asks:

Does the President pay income taxes to every state he visits on official business? This question occurred to me because of the pending Mobile Workforce legislation. Also, is withholding taken out of his paycheck for all of those states?

Taxgirl says:

Absolutely! Presidents report and pay taxes just like you and I do. In fact, you can view a number of presidential federal income tax returns (including the last round of candidates for office) at the Tax Analysts Tax History Project.

The President is paid an annual salary of $400,000. He’s also entitled to live at the White House, complete with staff and facilities. Transportation perks include two airplanes (referred to as “Airforce One”); a Marine Corps helicopter (”Marine One”); and an armored presidential limousine.

The first presidential salary was $25,000 per year, but George Washington refused to accept it. John F. Kennedy is said to have donated his salary to charities.

The presidential salary was $200,000 until 1999 when Congress doubled it – the actual change didn’t go into effect until 2001. The salary had not been changed since 1969, when it increased to $200,000 from $100,000.

As to the second question, the answer is no. Most politicians who work in Washington, DC actually pay tax in their home state; as members of Congress their primary residence remains in their home state, not in DC. This has caused quite a hullaballoo in years past with many politicians claiming residency in their home state but also “enjoying” (illegally, as it turns out) a homestead exemption for residences in DC. Rep Charles Rangel (D-NY) and Karl Rove have both been investigated for claiming the exemption in recent years; in 2005, 22 senators were have said to receive the exemption.

That said, the rule in most states is that you must report and pay taxes associated with either residency or sourced income. Clearly, if the President (or any other politician) is just visiting a state, he (or she) would not meet the residency requirements. And while the President is arguably working when he visits other states, he’s not receiving income sourced from those states – he’s paid by the federal government. If, however, the President stopped in and did a shift at a local McDonald’s for pay, then he would be subject to tax in the state where the McDonald’s is located.

Like any good lawyer, I need to add a disclaimer: Unfortunately, it is impossible to give comprehensive tax advice over the internet, no matter how well researched or written. Before relying on any information given on this site, contact a tax professional to discuss your particular situation.

Have a question? Ask the taxgirl! – Now on Facebook!

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Dave Barry Runs for President, Tax Plan Is Surprisingly Simple

July 22, 2008 · 1 comment

Comedian Dave Barry is running for President (not) and he has a tax plan (also not). Check out this video clip on CNN.

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Presidential Candidates: Where do they stand on taxes?

April 18, 2008 · 2 comments

This week – in the midst of a busy tax season – I wrote a guest post for One Vote Matters. It’s a quick and dirty summary of where the presidential candidates stand on tax issues. You can read the entire post here.

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How much money do you need to make to be President?

April 18, 2008 · 2 comments

Democratic presidential candidate Barack Obama has released his tax return for the 2007 tax year showing that together with his wife, the Obamas earned $4.2 million. A whopping $4 million of that income was in the form of royalties from the sale of his books. Other income includes Obama’s Senate salary of $157,102 and $103,633 paid to Michelle Obama by the University of Chicago Hospitals, where she is on leave as an administrator.

The Obamas donated $240,370, or about 5.8% of their pretax income, to 33 churches and charities and donated $50,000 to the United Negro College Fund. They also donated $35,000 to CARE and $26,700 to Trinity United Church, where the Obamas go to church; the church’s senior pastor, Jeremiah Wright, has come under fire in recent months as being anti-American and racist.

Hillary Clinton fared even better last year. Together with former President Bill Clinton, she earned more than $20 million in 2007. Most of Clinton’s income comes was from speeches and books as a result of President Clinton’s years in office. The specifics of her tax return for 2007 are not yet available.

Both candidates have previously released prior years’ tax returns.

On the GOP side, we don’t yet know how much Arizona Senator John McCain, the Republican nominee, made last year. He has not released his tax returns. Presidential candidates aren’t required to make this information public but most do. It’s unclear why McCain has chosen not release his returns.

I’ve asked this question before – but in light of the criticisms that Obama might be “elitist” – I’ll ask again: does how much money a candidate make influence your vote? Does it matter where the money comes from? Does it matter where the money goes?

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Obama Releases Tax Returns, Challenges Clinton To Do the Same

26 March 2008

Democratic presidential candidate Barack Obama has released seven years of his tax individual returns this week.
The Obama family reported income of $1.65 million in 2005 and nearly $1 million in 2006. During that same period, the family made $137,622 in charitable donations.
Prior to 2005, the family seems to have a different financial picture. [...]

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Has Obama Changed the Race?

19 March 2008

If you had asked me, before today, what the single most important issue would be in the upcoming presidential election, I would have said the economy, hands down. For purposes of the election, it’s more important to voters than Iraq, than health care, than the environment (though clearly those issues are intertwined with the [...]

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