Sarah Palin owes back taxes! Quick Hussein! Put her in your cabinet!

Good news: She’s officially qualified to serve in Obama’s cabinet.

Gov. Sarah Palin must pay income taxes on thousands of dollars in expense money she received while living at her Wasilla home, under a new determination by state officials.

The governor’s office wouldn’t say this week how much she owes in back taxes for meal money, or whether she intends to continue to receive the per diem allowance. As of December, she was still charging the state for meals and incidentals…

“Last fall we raised questions about longstanding practices within the Department of Administration regarding tax treatment of per diem payments,” Kreitzer wrote in an exchange of e-mails over the past few days with the Daily News.

“At the Governor’s request, we reviewed the situation to determine whether we were in full compliance with the pertinent Internal Revenue Service regulations,” [state administration commissioner Annette] Kreitzer wrote. “As a result of this review, we determined that per diem needs to be treated as income, requiring a revision of W-2 forms for any affected employees.”

Remember when WaPo broke the per diem story last fall? It was 10 days after McCain picked her, during the momentary lull between the media obsessing about Bristol Palin’s pregnancy and the media obsessing about Palin’s tanning bed. Team Maverick defended her for billing the state for nights away from Juneau spent in her own home in Wasilla, but the practice was sufficiently unusual that she evidently opted for full transparency and ordered a state review. Shrewd move: As embarrassing as it is to have this come out so soon after Geithner and Daschle, it would have been more embarrassing still to have it come up again in a future primary.

Exit question: Is Jerry Taylor the conservative movement’s newest persona non grata?

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February 18, 2009 · Filed Under Sarah Palin

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