I previously blogged (here and here) the tax consequences of President Obama's Nobel Prize:  although the prize will cause some subtle tax headaches under various phaseouts rules (e.g., itemized deductions, AMT exemption), there will be no general tax advantages or disadvantaged to the President:  he will either (1) include the $1.4 million in income and make offsetting charitable deductions, or (2) if he runs up against the 50% AGI limit on charitable deductions, he can exclude the $1.4 million in income under § 74(b) by having the Nobel Committee directly transfer the prize to charity.  Either way, President Obama's tax situation is unaffected.

Despite these clear tax conequences, today's Washington Post published an op-ed with this erroneous statement:

[T]he president has indicated that he will give the prize money to charity, but that does not solve his legal problem. Giving that $1.4 million to a charity could give him a deduction that would reduce his income taxes by $500,000 — not a nominal amount.

An Unconstitutional Nobel, by Ronald D. Rotunda (Chapman) & J. Peter Pham (Foundation for Defense of Democracies).  One hopes that their constitutional analysis is sounder than their tax analysis. (Hat Tip: Ralph Rainier.)

Update:  Ellen P. Aprill (Loyola-L.A.): 

An earlier comment on a blog that mentioned this same ethical issue suggested one way around the problem would be for Obama to suggest to the Nobel Prize Committee that it give it directly to the charities he recommends (without his knowing about § 74(b)). Thus, use of  § 74(b) might avoid not only tax but also government ethics and Constitutional issues!