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Politics Northwest

The Seattle Times political team explores national, state and local politics.

August 28, 2012 at 6:00 PM

Jay Inslee admits mistake in taxes, files amended return

Gubernatorial hopeful Jay Inslee corrected an error in his 2009 taxes on Tuesday, filing an amended return to remove a $5,500 deduction on the sale of a country club membership.

The amendment was made after Inslee consulted with his accountant, who originally prepared the tax return,  campaign spokesman Sterling Clifford said.

“It was a mistake,” Clifford said.

The deduction on the Wing Point Golf and Country Club membership had raised questions since Inslee and his wife, Trudi, released five years of federal income-tax returns last week.

The return counted the July 2009 sale of the membership as a long-term capital loss because the couple had sold it for $5,500 less than what they paid. According to the return, the couple bought the membership for $11,500 in 1988 and sold it for $6,000.

Independent tax experts said the deduction represented a complicated tax question.

Scott Schumacher, an associate professor of tax law at the University of Washington, said the sale could only be counted as a deduction if the Inslees had bought the club membership as a business investment with the intention of selling it later for a profit.

“Personal losses are generally not deductible, and a country club membership would most likely be treated as a personal asset,” Schumacher said. “It would appear that the deduction is incorrect.”

Among those curious about the deduction was Jay Inslee’s brother in law; according to Clifford, it was the brother in law who first brought the issue to Inslee’s attention.

Inslee is a Democrat and former member of Congress engaged in a tight gubernatorial race with Republican Attorney General Rob McKenna.

The Inslee campaign used the scrutiny over the club membership deduction to note that McKenna has refused to release any tax returns.

“You only have the opportunity to raise this question because Jay Inslee did the right thing and released his tax returns,” said Clifford, who called McKenna’s decision “an incredible act of hubris.”

“It’s not for us to say what information voters deserve,” he said.

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Comments | More in Governor, Statewide | Topics: Jay Inslee, Rob McKenna, Sterling Clifford

About this blog

Politics Northwest is the go-to blog for politics in our region. The blog explores national, state and local political news and issues. Reporters from Washington, D.C., to Seattle City Hall to the state capital in Olympia contribute. Editors are Richard Wagoner and Beth Kaiman.
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