KS Sunflower brought to my attention a comment on another blog of Pokeen Djibouti regarding some questions pertaining to possible Tax Credits for Bristol’s new show, Life’s a Tripp. Here is what my investigation shows:
1. Life’s a Tripp is produced by Helping Hands, LLC.
2. The Show’s original concept was to feature the Massey brothers with Bristol in Los Angeles as they embarked upon various charitable endeavors.
3. Helping Hands is a Limited Liability Company organized under the laws of Delaware. It is not unusual for a corporation to be a Delaware Corporation, as the corporate laws in Delaware or more favorable to corporations that most other states. That is especially true with a Delaware LLC. Advantages of being a Delaware LLC include:
Limited Liability: Owners of a LLC have the limited liability protection of a corporation.
Flexible Profit Distribution: Limited liability companies can select varying forms of distribution of profits. Unlike a common partnership where the split is 50-50, LLC have much more flexibility.
No Minutes: Corporations are required to keep formal minutes, have meetings, and record resolutions. The LLC business structure requires no corporate minutes or resolutions and is easier to operate.
Flow Through Taxation: All your business losses, profits, and expenses flow through the company to the individual members. You avoid the double taxation of paying corporate tax and individual tax. Usually, this will be a tax advantage, but circumstances can favor a corporate tax structure.
4. Helping Hands LLC filed a request for a tax credit with the film office in Alaska, requesting a tax credit for this film. The “decision date” for the approval for Helping Hands Production was 7-22-11 and its status is “pending.”
5. The application for a film tax credit for Helping Hands was received by the film tax office on 7-21-11, the day before it was approved.
6. The application for the tax credit has multiple blanks redacted, including the amount of money associated with the production of the Helping Hands production.
7. The application for the film tax credit was filed by an attorney, Monique Renner, for John Tiemessen, the attorney on retainer for the SarahPAC.
8. The application for the film tax credit identifies the company applying as “Helping Hands LLC” doing business as “Helping Hands Productions.” That simply means that if the public hears that the film is made by “Helping Hands Productions,” that really means it is made by Helping Hands LLC.
9. The person signing the application for the tax credit makes the following representations:
“I certify that the production is not an ineligible project as defined in AS 44.33.233 ©.
I certify, under penalties of unsworn falsification, that the above statements and information contained in the application and attachments are complete, true, and correct to the best of my knowledge and belief.
10. Here is AS 44.33.233.The statute expressly states that a film tax credit is not available unless the film office determines that the production is “not contrary to the best interest of the state.” (double negative not mine)
Now that I have provided the background and citations, let me try to explain this in more easily understandable terms. Helping Hands is a legal entity organized by the attorney for Sarah Palin. It is NOT a charitable organization. That legal entity applied for a tax credit, and although approved, the amount of money to be paid to Helping Hands has not been disclosed. I left three messages for Dave Worrell of the Film Office, and he never returned my call. He has told me in the past that the information about amounts of money awarded in tax credits is not available to the public until it is available on the Web Site. The web site of the Film Office in Alaska does not currently disclose the amount of the tax credit awarded to Helping Hands.
Because Helping Hands is a Limited Liability Company, the corporation is not taxed, but the individuals employed by the company are taxed directly for any amounts they receive through Helping Hands. Thus if Bristol was paid $1,000,000.00 for making Life’s a Tripp, she would be required to pay tax on that income, but Helping Hands would not be required to first pay tax on the corporate income. If Sarah Palin was an employee of Helping Hands, she could be paid any amounts agreed upon, but have limited risk of legal liability. While it is theoretically possible to pierce the corporate veil, it virtually never happens. Thus if Bristol and Sarah were employed by Helping Hands, and were paid a salary for their appearances in the filming, it is of no consequence to them if the show is profitable or not. They were probably paid at the time of filming, not at the time the show was aired. Thus the people of Alaska have once again subsidized the making of a reality show by a member of the Palin family. The tax credit approved has nothing to do with the ultimate success of the show, so Alaskans are subsidizing the Palins regardless of whether their reality show is popular or not.
The award of a tax credit to this show is particularly troublesome for two reasons. First the show is about the luxurious life of an unwed teenager. Given the rate of unwed teen pregnancies in Alaska, this film which glorifies unwed teen pregnancies, is contrary to the best interest of Alaska. Moreover the film was clearly made, at least in part, in California. The film tax law was designed to promote film making in Alaska. The film office was charged with administration of the film production incentive program for “film production expenditures incurred in the state.”
Perhaps if the film office had taken more than 24 hours to approve this film tax credit, they would have realized that this project didn’t qualify.
The Palins have now financially benefitted from the law enacted during the short time Sarah Palin was Governor on four separate occasions; Sarah Palin’s Alaska, Big Hair, Life’s a Tripp, and Stars Earn Stripes.
The amazing thing is that this was a direct violation of the Ethics Act, but the Alaska Attorney General denied the claim. I remain incredulous that the Palin family continues to benefit financially from the legislation enacted by Sarah Palin and yet the Attorney General of Alaska refuses to put a stop to this abuse. I am even more incredulous that Sarah Palin continues to assert that the government should get out of the way and yet she continues to benefit from government programs she put in place. Palin said: “It is time to remind (elected officials) that government should be working for us, we should not have to work for the government.”
Clearly Sarah Palin is making the people of Alaska work for her.