Geithner failed to pay personal taxes

[Joanne98]

Source: AP

WASHINGTON (AP) — President-elect Barack Obama's choice to run the Treasury Department and lead the economic rescue effort disclosed publicly Tuesday that he failed to pay $34,000 in taxes from 2001 to 2004, a last-minute complication in an otherwise smooth path to confirmation.

Timothy Geithner paid most of the past-due taxes days before Obama announced his nomination in November, according to materials released by the Senate Finance Committee. He had paid the remainder of the taxes in 2006, after the IRS sent him a bill.

The still-unpaid taxes were discovered by Obama's transition team while investigating Geithner's background.

Senate Finance Committee Chairman Max Baucus said he still hoped Geithner could be confirmed on Inauguration Day. Obama's staff told senators about Geithner's tax issues Dec. 5.



Read more: http://www.google.com/hostednews/ap/article/ALeqM5hj1yF_ptG-7vosxFrnx7fysb3IdgD95MGTMG1

[Old and In the Way]

1. Just read a good recap here-

http://www.washingtonmonthly.com/archives/individual/2009_01/016427.php

Appears to be much todo over nothing. Even the Republicans appear to be inclined to overlook it.

[Cha]

36. Thanks..

<snip from your link>

"At this point, I'd be surprised if anything came of this. We're talking about infractions that a) are minor; b) Geithner addressed and corrected; and c) he made no effort to conceal. It'll take considerable effort for Republicans and Fox News to gain traction with this."

It doesn't take much around here.. just a headline from AP.

[No Elephants]

52. Which probably means that plenty of them owe back taxes, too.

[Paul Giulani]

65. As Treasury Secy, Geithner will be boss of IRS...

So he could pardon himself. :)

[DJ13]

2. He wasnt a great choice anyway, too close to the DLC

[WCGreen]

3. This is a simple mistake. It looks as if he included his money from

working with the IMF as income thinking that it wasn't covered under the Self-Emplouyment taxes, individuals Social Security and Medicare. He paid income tax but not the self employment tax...

[yardwork]

7. Shouldn't a candidate for Treasury Secretary have known this?

It seems like kind of a big deal to me.

[ProgressIn2008]

35. You made me laugh out loud. Except I don't think you intended to.

Yeah, if this is what passes for the excuse-of-the-day, it's an unusually sorry one.

[WCGreen]

42. It's kind of a really obscure part of the tax code...

[yardwork]

50. Paying taxes on consulting income is an obscure law? Turns out that I'm a tax expert.

[undeterred]

54. When you're so rich that $34,000 of taxes doesn't get noticed...

you basically think you're going to get away with breaking the law. If they confirm this guy, what does that say about people who deliberately cheat on their taxes...that its not a big deal, as long as you pay up when you're caught.

[JFKfanforever]

64. Yes, it is a big deal... The Fed wants to run the Treasury as well.

Congress should disqualify him if he does not have the decency
to resign...

Have a look at how the general public is enraged by Tim's
"honest mistake" (ha! ha!).  Their arguments are
strong and make very interesting reading.

[Runcible Spoon]

10. The IMF is a fucking DISGRACE and I would really rather anyone who worked for them

stay far away from Obama....however that is quite a pipe dream, I know :evilfrown:

[spotbird]

41. The DlC is what qualified him

We're homogenized now

[razors edge]

4. Sounds qualified to me.

[yardwork]

8. LOL!

[mikita]

11. snort

that made me LOL!

[Pastiche423]

37. GMFAO!

[Runcible Spoon]

5. I don't know why people are excusing this...

if he was going to be appointed for something like EPA or whatever, ok fine, I could understand people giving him a pass on "oops" but fer crissakes you want to put a man who can't keep his taxes straight in charge of the gigantic bureaucratic machine that is the Treasury Department?!

:nuke:

[Zynx]

14. At first I thought this inane post was sarcasm or satire. Sadly it was not.

[Runcible Spoon]

18. how lovely that all you can offer is insults instead of actually discussing the meat of the article

how sad for you.

[notesdev]

19. It just goes to show

if a potential Secretary of the Treasury can't get his taxes straight, maybe just maybe the tax code is too complicated.

[Runcible Spoon]

20. well that's an entirely separate concern, and I do think tax code is ridiculous...

however, millions of regular people figure it out fine. I'm sorry if I have lofty expectations that a Cabinet level presidential appointment to head policy directly related to taxation should have his own taxes in line. I know, color me crazy.

[machI]

24. Millions of regular people pay good money to figure it out

Last week I plopped down my $29.95 for Tax software. I've had to do this for the last five years.

(I actually pay for my software. I don't bootleg it like a lot of folks do.)

[customerserviceguy]

29. Does TurboTax ask if you work for the IMF?

I used to do taxes, and at the Enrolled Agent level. I even sat for the Tax Court exam in 1982, and I had no idea about this. This is a non-issue, the IRS audited, he accepted their conclusions, and paid up.

The tax code is WAY too complicated, full of loopholes all over the place that the rich use to avoid paying their fair share. If Geithner had worked as an employee for another firm at the same time, and paid the max into SS and Medicare, he wouldn't have owed this money.

[Grinchie]

32. I think it's the fact that he was Consulting at the IMF during the Bush years.

This has a lot of people surprised, including me, and I don't have good things to say about what the IMF does, or what they stand for.

It's kind of like Mark Penn lobbying for Columbia while managing the Campaign for Democrat Hillary Clinton.


BTW, Columbia is the third largest recipient of funds after Israel...

[ellisonz]

68. Co-lombia.

[tblue37]

59. I pay about $300 a year for an H&R Block tax preparer to do my

return, and I make just $40,000/year. But a small part of that comes from self-employment (tutoring and editing), so of course it gets complicated. I would do my taxes myself if I could manage it, but I have tried and I can't!

[Grinchie]

31. Yeah, good reason to not pay taxes -- it's too complicated!

Thanks for the free pass on not paying taxes.

Sadly, it didn't work for Geithner, nor would it work for you or me.

[kiranon]

6. Hmmm. Would like more info and why IRS waived penalties and

does the IRS usually waive penalties in these situations. In other words, can all similarly situated people have their penalties waived as well? Or refunded?

[Abq_Sarah]

66. The ordinary citizen

Isn't going to be told a failure to pay taxes is a minor infraction.

When my company only had one full time and one part time employee, I paid employment taxes quarterly when I filed my 941s. One quarter I went over the limit by $7.00 and got dinged 10% on the full amount. The IRS doesn't care than I didn't know I'd go over by just a few dollars, they penalized me over $200 for not depositing monthly even though I'd never been required to do it in the past.

[Seldona]

9. Happened to me because of my accountants advice.

It is all rather complex mumbo jumbo few understand, even fewer well, that caused my snaffu with the IRS. Seems one of our products, for reasons that sounded plausable at the time, was not taxable. Or so our accounant told us.

Three years later the IRS informed us differently and, with a new accountant in tow, we proceeded to watch the IRS gut our business. Shit happens.

[Runcible Spoon]

12. that's fine, but you're not in line to oversee the Treasury Department

and help oversee one of the largest disbursal of public funds in US (world?) history.

[Zynx]

13. Harry Truman was a failed businessman and proved to be a sound executive.

That's really kind of an irrelevant statement on your part.

[Runcible Spoon]

16. your comment is pretty irrelevant too

I would expect someone who wants to jump in as head of Treasury have a pretty fundamental knowledge of how taxes work. Hell, I did 3 months of contract work when I was 19 and I figured out how to file a fucking 1040.

[LanternWaste]

63. Self delete.

Self delete

[yardwork]

39. And George W. Bush was a C student. I thought we'd moved into better territory.

I don't want incompetent - and criminal - people running the country.

[Seldona]

15. No.

But as I was trying to point out it can happen quite innocently. It is taken care of.

:boring:

[Grinchie]

33. Yep, nothing to see here, move on

I want to know more about hiis involvemnet with the IMF.

[goodhue]

21. In this case, it appears he did his own taxes

"The punchline to this whole imbroglio is this: The tax returns that contained the mistakes? Geithner did them himself."
http://voices.washingtonpost.com/economy-watch/2009/01/geither_meets_with_senators_ov.html?hpid=topnews

In any event, FICA and SECA are pretty straightforward, not complex mumbo jumbo.

[Seldona]

62. Have you done quarterly returns with capital gains

as well as other business income? I am incredibly good with a few things, okay with a few more, and the rest I wrote checks to professionals whom I trusted. My mistake. In my case as well taxes were owed, as well as penalties and interest. Didn't make me a criminal, even in the government's eyes.

While they wanted their money, they as least recognized we weren't tax cheats. I hope that is the case here, but I have never stated it is. I support full disclosure and if anything improper is found than by all means have at it.

I am sorry I shared my experience. I will not make the same mistake again.

[No Elephants]

55. Did you get your penalties waived? I thought the IRS was obligated by law to collect every

dime, so long as the taypayer had assets.

[Seldona]

61. Nope.

Nor interest.

[goodhue]

17. Its pretty simple that if employer does not do FICA withholdings, then you got to pay SECA tax

What's not to understand? How could a financial professional miss this for four years running?

[yardwork]

40. I don consulting on the side and I'm well aware that I owe taxes on my consulting income.

That's small business 101. And no, I'm not an accountant. But any accountant will tell any consultant that they have to declare their consulting income.

[robcon]

22. Huh? I see this a total disqualification for Geithner.

Would it be ok for the Secretary of the interior to have a toxic waste site on his/her property? Paying taxes on time is a minimum to be expected from a Secretary of the Treasury.

[soothsayer]

48. that crook paulson was given his $600 mil or whatever tax free.

[L0oniX]

23. "Only little people pay taxes" - Leona Helmsley

I know this is going to make little people very angry ...pffft

[machI]

25. Looks like the Republican Slime Machine is fixin' to go into overdrive. n/t

[goodhue]

26. I'm not sure why this is a "Republican slime" issue

I'm a big lefty and think failure to pay federal social security witholding for four years is reason enough to disqualify Geithner.

[w4rma]

27. Disqualify him. There are MUCH better qualified people. (nt)

[NashVegas]

28. Oh, Come ON. Enough "Short Cuts" Administrators

and also an immigrant housekeeper who worked for Geithner for several months without the proper employment documentation.

[Grinchie]

30. I was unaware of his link to the IMF -- He should step down now like Richardson.

The IMF uses money to impose it's will and put poor countries into the debt spiral.

The IMF is a fancy name for "Economic Hitman" Just look at what it did to Jamaica in the 70's.

Another Obama dissappointment, poor choice, Blue Dog DLC good ole boy.

[diamidue]

34. That's not all.

He is also a Bilderberger and a member of the Council on Foreign Relations.

[Pastiche423]

38. Yep

He and Hillary Clinton attended a Bilderberg meeting this past June.

[customerserviceguy]

43. But if you mentioned the IMF to one hundred average Americans

You'd get 96 or 97 responses ranging from "huh?" to "so what?" to "sounds like good experience". It's not a hot button for people who don't mind Rick Warren delivering the invocation, and they at least know what gay marriage is.

[slipslidingaway]

44. Senator Byron Dorgan:Federal Reserve Refuses To Identify Recipients Of 2 Trillion In Emergency Loans

http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=385&topic_id=257863&mesg_id=257863

http://en.wikipedia.org/wiki/Timothy_F._Geithner


Unless I am mistaken, the president of the NY Fed sits on this board...

"...The Federal Reserve Board, they are refusing to identify the recipients of almost $2 trillion of assistance backed emergency loans from American taxpayers. They refuse to identify the troubled assets they are accepting as collateral. The Federal Reserve opened it window for the first time in history to noninsured banks. They have all kinds of programs now to move money out. I understand there is an urgency here, but I do not understand why the American taxpayers are told: By the way, you are the guarantor of a lot of these debts, you are going to pick up the pieces, and you are going to pay for it, but we are not going to tell you what it is we are doing. Mr. President, $2 trillion of emergency loans for troubled assets and they say: You don't deserve to know. We are not going to tell you.

In fact, Bloomberg, the news organization, had to sue the Federal government to try to get details about the total has gone out in terms of guarantees and capital which, by the way, is over $8 trillion. It does not mean we are going to lose all that. My point is, why should a news organization have to sue the Government in order to give the American people some information about how much they are on the hook for with all of this emergency activity?..."

[JFKfanforever]

47. End the stranglehold of the Fed, a private cartel...

Return all monetary governance and control to the govrnment of
the USA, for example the Treasury.

Disqualify GEITHNER (because he has disqualified himself by
filing the ethical litmus test for a cabinet position) and
choose someone who has no trailing bilical cord to the Fed (or
the IMF or the World Bank or any think tank)or to any major
Wall Street firms or to Fannie/Freddie.

[slipslidingaway]

49. That will not happen any time soon, it would be nice if someone

asked Geitner about the two trillion.

[RCinBrooklyn]

45. I know I have to pay FICA taxes. He's the expert and doesn't? He should withdraw.

[young_at_heart]

46. Charlie Gibson did not sound like a real journalist when he "reported " this story tonight

He sounded like Bill O'Reilly on a rant!

[Acadia Blue]

51. I support Obama but this man should not have this job if he is too

greedy not to pay his taxes. OMG the man is rich. I am sick of these priviledged parasites. Find someone honest.
Obama, we need a clean change.

[bbgrunt]

53. k and r. He should step down. We don't need another dlc'er

[No Elephants]

56. So, if you have an undocumented alien working for you, you can

run the INS? If you paid your nanny, cleaning woman or gardener under the table, you can be Secretary of Labor?

Man, I've been way too much of a goody two shoes to get anywhere in government. I gotta go break me some laws.

Now, that's change I can believe in!

[apnu]

57. OK, but he's square with the house now right? So why all the fuss?

:shrug:

[closeupready]

58. Disqualify him.

I find this completely unacceptable.

[Lagomorph]

60. Since he's choosing our experts...

I'd feel more confident with someone who is more tax saavy than Geithner.

I'd try to choose experts who have proven they are always on top of the subject.

There's probably a few hundred DU'ers who would have got Geithner's taxes right, pick one of them.

I mean, if you want to run Treasury, you should at least be able to do your taxes!!!

Am I wrong?!?!?!

[Bolo Boffin]

67. Geithner also was reimbursed for these payments by the IMF.

This is starting to sound pretty bad. Not only didn't he pay the self-employment tax, but he was accepting reimbursement payments from the IMF to make the payments. The IMF also took great care to point out they weren't taking out these taxes.

Geithner was also audited for 2003 and 2004 and forced to pay the SE tax for those years well before nomination. It's only the 2001 and 2002 years that Geithner paid when his non-payment was caught by the Obama team.

http://thecaucus.blogs.nytimes.com/2009/01/13/geithner-choice-for-treasury-questioned-on-his-tax-returns/?apage=8

Yeee-uch. First Richardson and now Geithner is probably going down.

[robcon]

69. We don't need a tax cheat, or sloppy tax filer, running the IRS.

NYT editorial...

More Questions for Mr. Geithner
Published: January 14, 2009

"....As much as Mr. Obama and his team may wish it, however, the disclosures cannot be dismissed so easily, or papered over. The just-the-facts report of Mr. Geithner’s tax transgressions, compiled and released by the Senate Finance Committee, paints a picture of noncompliance that is considerably more disturbing than his supporters are acknowledging.

Mr. Geithner must be questioned forcefully about these matters at the hearing next week, and his explanations must be credible. Even in the best of economic times, it would be hard to accept a Treasury secretary — who, after all, is in charge of the Internal Revenue Service — with a cavalier attitude toward paying his taxes. Today, in a time of economic peril, the nation cannot afford a Treasury secretary with a tainted ability to command respect and instill confidence....

...Obama officials say Mr. Geithner, who worked for the International Monetary Fund, had made a common error among international employees in Washington. But as The Journal reported on Wednesday, failing to pay the self-employment tax is not necessarily common among sophisticated I.M.F employees. Rather, one of the reasons such noncompliance is widespread is that it includes household embassy workers and other lower- level contractors. And regardless, the Finance Committee found that Mr. Geithner had signed paperwork at the I.M.F. that acknowledged his self-employment tax obligation.

The story does not stop there. Mr. Geithner also failed to pay the self-employment tax in 2001 and 2002. Those returns, which the report says Mr. Geithner prepared himself, were not audited and so the I.R.S. did not order him to pay up — which raises the question of why he did not voluntarily amend those returns and pay the taxes and interest at the time of the 2006 audit. Instead, he waited until after vetting by the Obama team late last year revealed the shortfall — $19,176 in taxes and $6,794 in interest.

A similar lapse occurred on another tax issue. On returns for 2001, 2004 and 2005, Mr. Geithner wrongly claimed expenses for sleep-away camps in calculating his dependent care tax credit. The accountant who prepared his 2006 return informed him that payments to overnight camps were not allowable expenses, but again, he did not file amended returns for the previous years at that time. The report does not break out the taxes and interest on that item alone, but along with other adjustments, Mr. Geithner owed an additional tax of $4,334 and interest of $1,232.

Many people find taxes baffling, but before his job at the I.M.F, Mr. Geithner was a senior official in the Treasury Department under President Clinton, and for the past five years he has been the president of the Federal Reserve Bank of New York. With that professional profile, tax transgressions are tough to excuse.
http://www.nytimes.com/2009/01/15/opinion/15thu1.html?_r=1&th&emc=th