Lamar Odom has sued the Internal Revenue Service, which said he couldn’t take tax deductions for $12,000 in sports fines and another $178,000 spent getting himself in shape.
The 6-foot-10 Odom . . . filed suit in U.S. Tax Court to fight an IRS bill for $87,000 over his taxes for 2007. That includes $9,000 in interest. However, unlike many IRS efforts to collect money, the bill did not include a claim for accuracy-related penalties. This might mean the agency sees his case somewhat less harshly than others it duns.
A college dropout, Odom is representing himself without a lawyer. In his personally signed pleading, filed at the court’s Washington, D.C. office on October 25, Odom disputed a bill that the IRS sent him in August. “The taxpayer claimed $12,000 of employee business expenses for fines that were assessed by the National Basketball Association,” he declared, writing in the third person. “These fines are commonly assessed on professional athletes and are work related. Therefore the fines incurred are ordinary and necessary employee business expense.” The petition, which listed his address as an agent’s office in Los Angeles, offered no details about the nature of transgressions leading to the fines.
Federal law generally prohibits tax deductions for financial sanctions resulting from criminal cases and matters like traffic violations. But Odom wrote, “The fines imposed by the team and the NBA are not imposed for the violation of any government law and are therefore not specifically excluded.”
Wednesday, November 10, 2010
Are NBA fines tax deductible? Lamar Odom takes on the IRS
From William Barrett of Forbes: