Senator Obama's Taxes

I am not a big fan of the trend of releasing a presidential candidate's tax returns. Very rarely does one find anything out that they did not already know. For example, when the Clinton's released the returns that showed they deducted outrageous amounts for donations of used clothing, was anyone surprised? That caveat notwithstanding, I did look at the Obama tax returns which were posted on TaxProfBlog (which by the way is one of the best tax sites on the net - Professor Caron performs a real service to those of us interested in tax issues!)

But after I got over my initial reservations about snooping, I looked at them pretty closely with one question in mind - Do the Obama tax returns tell you anything new about the senator? Here is what I think I found.

First, Mr. Obama's books have been pretty successful and he has treated the creation of those books in a reasonable way, taxwise. Second, from my perspective, he tries to comply with the spirit and letter of the law. He files, with some detail, the expenses of his child care people and pays the employment taxes for his workers. His charitable activity (which some blogs have yammered about because he does not tithe) show me that he understands that making a substantial contribution to a charity can help it. He has made two large gifts to CARE and a couple others to Childhood Literacy projects. His church contributions are not huge until 2006 (and that might be a building fund commitment). Third, like many others in his economic class he has gotten clipped by the Alternative Minimum Tax (AMT) - although because of the percentage of outside income and the amount of self employment tax he seems to have gotten nabbed a bit less than someone who received all of his wages from salary.

So what do we know from the returns? He takes his responsibility as a taxpayer seriously. In this era, that is a pretty good affirmation. As noted at the beginning of this post, I believe that this public disclosure should not be mandatory. In one sense the disclosures would tend to turn me off if a person played the system as a game. On the other hand, if they file scrupulously and have policy positions which I disagree with, the good tax status would not change my vote.

Senator McCain is expected to release his returns in mid-April. To my knowledge the Clinton returns have not had a scheduled release.