Last fall President Obama challenged Mitt Romney to come clean and release his tax returns so voters would know whether he paid his fair share. I respectfully ask President Obama to come clean regarding the filing of his 1990 tax return when he signed a six-figure contract book deal with Poseidon Press. Failure to do so would be a violation of Title 26-Internal Revenue Code.
GQ Magazine’s November 2009 issue (www.gq.com) reported that President Obama signed a six-figure contract with Poseidon Press on November 28, 1990. The exact amount was reported as $150,000 by Christopher Andersen in his book Barack and Michelle: Portrait of an American Marriage. According to Jack Cahill, Barack Obama was advanced $75,000 for the book. It’s not unusual in the publishing business to receive one-third to one-half of the contract value upfront. However, a $75,000 advance would have required a recent law school graduate strapped with heavy student debt to pay the IRS $25,000 four and ½ months later. Failure to do so would be a violation of Title 26-Internal Revenue Code. I have been a CPA over 33 years and I’m Certified in Financial Forensics. In 1988 I was hired by the Arizona House of Representative in the Senate Impeachment Trial of Governor Evan Mecham. My forensic analysis of an improper $80,000 loan from a political protocol fund to a car dealership justified the impeachment of Governor Mecham.
I reviewed the tax returns of both presidential candidates. (www.barackobama.com) During my analysis of President Obama’s 2001 Individual Tax Return, I found 10 math errors. All of the errors were simple arithmetic errors that would have been prevented with a computerized program such as Turbo Tax.
President Obama’s 2001 tax return wasn’t signed by a paid preparer and it would appear it was prepared by President or Ms. Obama. I determined that the Obamas prepared three drafts of their 2001 tax return. The first draft calculated an income tax liability of $79,000. This would have required taxable income of $271,000. In contrast, President Obama’s website shows 2001 taxable income of $250,000. President Obama ended up paying income tax on $21,000 of phantom income that resulted in sending Uncle Sam an extra $7,300. I think Republicans and Democrats will unanimously agree that President Obama is one of the greatest orators of our time. The same can’t be said regarding President Obama’s skill as a tax preparer!
Based on the fact that President Obama used bits and pieces from three different 2001 tax drafts, made 10 errors, overpaid his taxes by $7,300 by claiming $21,000 of phantom income, it would appear that President Obama lacked the accounting skills to competently prepare his tax return. If President Obama wasn’t proficient at preparing his taxes in 2001 it’s not a stretch to assume that he wouldn’t have been proficient in 1990.
I believe President Obama’s may have a skeleton in his tax closet from the mishandling of his est. $75,000 book advance from Poseidon Press in November of 1990. Only three tax scenarios exist: 1) filed correctly and paid the IRS $25,000, 2) reported income as passive, failed to pay social security taxes and owes the IRS $41,000 or 3) never received 1099 from the publisher, failed to properly report the income and currently owes the US Treasury $125,000.
I contacted the IRS and they indicated that the tax records may go back to 1990. Another method to determine if President Obama paid his “fair share” would be to verify his 1990 earnings with the Social Security Administration. American taxpayers can decide for themselves whether a young Barack Obama should be given a free pass or if he should be held to the same standard as all Americans