We're less than two weeks away from the presidential election, so you know major fiscal issues are dominating the political discussions. Like how Sarah Palin's new wardrobe.has helped jump start our economy.
As soon as The Republican National Committee (RNC) reported that it spent more than $150,000 on a Palin makeover (including professional hair and makeup services in addition to the clothing), political pundits began debating whether the outfits from Neiman Marcus and Saks would damage Palin's down-home hockey mom image.
Tax geeks, however, don't care about such trivial matters. What tax liability, we immediately wondered, might the Alaskan governor face for accepting the haute coture?
Are the fashionable suits, shoes and accessories gifts? Campaign trail uniforms? What?
A uniform 'no': The ABC News blog Political Punch spoke with one tax expert who immediately discounted any attempt to classify Palin's new clothes as a uniform.
A former IRS commissioner agreed. "They can make the uniform argument, but they won't win," Donald Alexander, who held the IRS top post under President Nixon, told Bloomberg.com. "Unlike bus drivers and the Alaska National Guard, you're not required to wear a uniform" to campaign for office.
On loan? OK. How about the explanation that the RNC owns the clothes and Palin's just "borrowing" them? That could pose tax trouble, too, says ABC's unnamed tax expert.
"This is exactly the issue with the [Alaska Sen. Ted] Stevens case," he said. "When you loan something to someone can you call it a 'loan' if, upon its return, it has no practical value?
"The consensus view is she would have to count the wardrobe as income at least in the amount of the fair value of the rental of the wardrobe," he said.
Over at TaxProf, several other potential tax implications of Palin's new clothes are explored.
Bargain shopping: And if you're looking to spruce up your closet, you might want to wait until Nov. 5 to go shopping. Then keep an eye on any RNC staffers heading to Goodwill drop-off locations.
According to The Sleuth over at the Washington Post, Palin campaign spokeswoman Tracey Schmitt issued a statement that it "was always the intent that the clothing go to a charitable purpose after the campaign."