I recently attended a lecture given by Arnold Kling, who is a former Federal Reserve economist on the Board of Governors staff, former senior economist at Freddie Mac, and all-around financial and monetary expert. The...
- The Tax Policy Blog
- California: Ottoman Turkish Empire Income Exclusion Someh...
California: Ottoman Turkish Empire Income Exclusion Somehow Persists in Existing
About this time every year, people in California who use tax preparation software remark that they were asked a confusing question about the Ottoman Empire. The reason for this question is to help with the following two sets of instructions from California’s Franchise Tax Board Publication 1001.
California law excludes from gross income, interest income received from settlement payments by individuals persecuted by the regime that was in control of the Ottoman Turkish Empire from 1915 until 1923, or the individual’s heirs or estate. Enter the interest on Schedule CA (540 or 540NR), line 8, column B.
California law provides an income exclusion for settlement payments received by an eligible individual, defined as a person persecuted by the Regime that was in control of the Ottoman Turkish Empire from 1915 until 1923, or the individual’s heirs or estate. Enter on Schedule CA (540 or 540NR), line 21f, column B, the settlement payments amount reported in federal income that qualifies for the California exclusion.
The persecution described was the forced relocation and genocide of Armenians, Christians, and other ethnic and religious minorities in the Ottoman Empire that began under the directive of Interior Minister Talaat Pasha in 1915. It is without a doubt one of the ugliest and cruelest moments in the history of mankind.
While there are no official reparations for the event, there have been some lawsuits pertaining to insurance policies issued during the time period. California tax law excludes income received from settlements pertaining to these events.
It is understandable to want to mitigate the cruelty of racial or religious persecution. There are certainly appropriate and fitting places to do this. Schedule CA 540, line 21f(B) is probably not one of those places. Not every human problem – including and especially those of serious moral significance – can be assuaged by an above-the-line tax deduction.
Get Email Updates from the Tax Foundation
We will never sell or share your information with third parties.
Join the Tax Foundation's fight for sound tax policy Go
About the Tax Policy Blog
The Tax Policy Blog is the official blog of the Tax Foundation, a non-partisan, non-profit research organization that has monitored tax policy at the federal, state and local levels since 1937. Our economists welcome your feedback. If you would like to send an e-mail to the author of a blog post, please click on that person's name to locate his or her e-mail address or visit our staff page here.