Obama's tax return

[BulldogTom]

I know this is a little late, but did any of you read the president's return when it was posted on the internet? Something has been bothering me about how it was prepared. He included a Sch. C and listed the business as "Author". There were no expenses on the Sch. C except some minor reimbursements to a publisher (i think that is what it was). Then he paid SE tax on the proceeds from his book.

Shouldn't that income from the book be Royalties and included on Sch. E and not subject to SE tax? He obviously cannot be carrying on a business when he is POTUS.

Hey, if the guy wants to pay more in taxes, more power to him, but isn't that return done incorrectly?

Tom

Lodi, CA

[JohnH]

There's nothing in his contract that says he can't work a part-time second job, is there?

http://www.whitehouse.gov/sites/default/files/president-obama-2010-complete-return.pdf

Did you notice the K-1 income from the Freeman Trust Pin Money Fund?

$12K annually for the first lady, dating back to the first Bush administration.

That's an interesting story in its own right.

http://en.wikipedia.org/wiki/Henry_G._Freeman_Jr._Pin_Money_Fund

[Catherine]

I know this is a little late, but did any of you read the president's return when it was posted on the internet? Something has been bothering me about how it was prepared. He included a Sch. C and listed the business as "Author". There were no expenses on the Sch. C except some minor reimbursements to a publisher (i think that is what it was). Then he paid SE tax on the proceeds from his book.

Shouldn't that income from the book be Royalties and included on Sch. E and not subject to SE tax? He obviously cannot be carrying on a business when he is POTUS.

Hey, if the guy wants to pay more in taxes, more power to him, but isn't that return done incorrectly?

Tom

Lodi, CA

It is my understanding that Sch. E royalties used to be proper treatment for book payments, but that some years ago there was a determination that, since the book would not exist without significant work on the part of the author, that those payments properly belong on Sch C, subject to SE tax.

[cred65]

Maybe Tim Geithner prepared his return.

[Maribeth]

I am interested in finding out what the $48,733 IRA distribution was for and what exception was used in order to get them out of the 10% penalty. There is no 5629??? (or whatever the form # is) to disclose the exception; yet no 10% on Page 2. Last time I checked; neither one of them was 59 1/2.

Maribeth

[TAXBILLY]

Inherited.

taxbilly

[Julie]

I've always understood that an author's or artist's royalties went on the Sch C because he created the value. At any rate, that's his livelihood. He was in the business of being an author. If you bought or inherited the rights, you would put the royalties on the E.

[Lion EA]

Hey, Julie, it's good to see your smiling face again! :D

[Julie]

Hey, Julie, it's good to see your smiling face again!

Thanks. It's been a while since I checked in here. I guess I just realized I missed you guys.

[jainen]

>>read the president's return<<

How come he doesn't e-file?

[JohnH]

Good question. Tim Geithner told him he could efile through Turbo Tax and save himself a bundle in filing fees and taxes. Plus, no penalties if you make a "mistake". Seems like he's a trustworthy source of info,.

[SaraEA]

Royalties on occasional books indeed belong on Sch E. If your JOB is author (e.g., Mark Twain, Shakespeare, J. K. Rowling), they go on Sch C. The IRS has made quite clear that activities conducted on an infrequent basis aren't subject to SE.