Tax Questions

Taxes and estate issues are tricky. Not surprisingly, last week's column on the tax consequences of putting children's names on the deed of a parent's house raised questions from readers. Here are the answers: Raphael of Baltimore sold a house he inherited from his father and gave $28,000, the majority of the proceeds, to his son and daughter-in-law. "Am I liable for any taxes on the sale of the house?" he asks in an e-mail. "And if I gifted the bulk of the money that I received in the sale, can I deduct it on my income taxes?"

Readers can submit questions about preparing their 2006 tax returns at www.baltimoresun.com/taxtalk. Members of the Hunt Valley accounting firm SC&H Group will answer questions.

GOV. ROBERT L. Ehrlich Jr.'s fondness for fees instead of taxes has placed many of his Republican General Assembly friends in a pickle. The Maryland Taxpayers Association says 22 of 33 current senators and delegates who signed an anti-tax pledge during their campaigns - all but five of them Republicans - violated the commitment multiple times because they voted for bills supported by Ehrlich. A "no-new-taxes" governor, Ehrlich nonetheless backed a $2.50-a-month charge on sewer customers and septic-tank owners to pay for sewage plant upgrades and a two-year automobile registration increase of $47 or $72 - depending on vehicle weight - to pay for roads.

If Gov. Robert L. Ehrlich Jr. is stymied in his bid to put slot machines at Maryland's horse racing tracks, it will be the result in no small part of the number crunching of a little-known investment banker from Chevy Chase. Jeffrey C. Hooke, a conservative anti-tax activist, has issued a string of studies over the past year that question what he regards as a potential "giveaway" of slots licenses worth tens of millions of dollars to a small group of politically connected racetrack owners.

I received a payment from my mother's annuity life insurance policy (after she died) in August. I just wondered how much income tax I'd have to pay on this. It's a little over $500. It depends on what type of policy triggered the payment to you, said Robert J. Sclama, former head of the federal and state tax committee of the Rhode Island Society of Certified Public Accountants. For instance, if you were the beneficiary of your mother's life insurance policy, any death benefit you received would be free from federal income tax, he said.