Andrew Malcolm: Geithner’s $48,000+ Honest Mistake (Updated)
[Guest post by DRJ]
Andrew Malcolm at the LA Times Top of the Ticket:
“Who in this busy life would ever think of paying income taxes each April? There’s never anything about April 15 in the media. And who’s got time to read that stuff anyway when you’re busy coming up with financial rules for other people to obey?
There’s more clever sarcasm at the link. In addition, the Instapundit and JustOneMinute provide more details about Geithner’s “honest mistakes.”
I’ve worked for a company with a home office in another jurisdiction. The company accountants frequently advised me about tax issues raised by those circumstances. I can’t believe the IMF wasn’t aware its U.S. employees had to pay self-employment taxes and I suspect the employees were told that repeatedly.
UPDATE — From Byron York at NRO:
“IMF employees were expected to pay their taxes out of their own money. But the IMF then gave them an extra allowance, known as a “gross-up,” to cover those tax payments. This was done in the Annual Tax Allowance Request, in which the employee filled out some basic information — marital status, dependent children, etc. — and the IMF then estimated the amount of taxes the employee would owe and gave the employee a corresponding allowance.
At the end of the tax allowance form were the words, “I hereby certify that all the information contained herein is true to the best of my knowledge and belief and that I will pay the taxes for which I have received tax allowance payments from the Fund.” Geithner signed the form. He accepted the allowance payment. He didn’t pay the tax. For several years in a row.
According to an analysis released by the Senate Finance Committee, Geithner “wrote contemporaneous checks to the IRS and the State of Maryland for estimated [income] tax payments” that jibed exactly with his IMF statements. But he didn’t write checks for the self-employment tax allowance. Then, according to the committee analysis, “he filled out, signed and submitted an annual tax allowance request worksheet with the IMF that states, ‘I wish to apply for tax allowance of U.S. Federal and State income taxes and the difference between the “self-employed” and “employed” obligation of the U.S. Social Security tax which I will pay on my Fund income.”
If this is true, I think it’s very bad for Geithner and Obama.
H/T NavyVet.
— DRJ
According to Byron York, the IMF paid Geithner a “tax allowance” to cover the amount he owed the IRS. As part of the process, he signed an agreement that he would pay the tax.
Of course, just because you agree to something in writing doesn’t mean you really have to do it. How much more of this “change we can believe in” can we take?
navyvet (4c272e) — 1/14/2009 @ 7:18 pmYeah, Dirty Harry Reid thinks this is just a hic up. And the left wing media is trying to make light of Geithner’s tax dodging as much as they can.
Question: does anyone remember how the vicious left wing media went after Joe the Plumber and his $1,200 back tax debt?
Ummmm, one standard for a Democrat and one standard for an really ordinary American citizen who makes a Democrat look bad.
retire05 (5eaffa) — 1/14/2009 @ 7:22 pmNavyVet,
Thanks for the link and I’ve updated the post. If Byron York’s information is correct, we may see Obama throw Geithner under the bus.
DRJ (345e40) — 1/14/2009 @ 7:25 pmIf York’s correct, that’s a second cabinet pick gone. First Richardson, then Geithner. Wonder who will be next.
PatHMV (a00c3c) — 1/14/2009 @ 7:33 pmMy cheap Turbotax program (Costco $40) would have picked this up easily. Maybe Geithner & his accountant should use it.
ManlyDad (75cbfe) — 1/14/2009 @ 7:35 pmROTFLMAO!!! Change you can believe in!!! Did I hear someone say double standard??? He, like Hillary, will get a pass. What a f*ck-up this Obama guy is, and he hasn’t even taken office yet! We’re bleepin Blago screwed.
J. Raymond Wright (e8d0ca) — 1/14/2009 @ 7:43 pmWho in this busy life would ever think of
Official Internet Data Office (333abc) — 1/14/2009 @ 7:45 pmpaying income taxes each April?reading Andrew Malcolm in the Los Angeles Times?And if you got caught taking $100 from store, I guarantee your life would be made a living hell.
Joe (17aeff) — 1/14/2009 @ 8:24 pmAnd Godforbid you violated the covenants of your HOA. You might as well kill yourself.
Joe (17aeff) — 1/14/2009 @ 8:24 pmThe part that looks really sleazy is that after he was audited for 2003 and 2004 and nailed on the issue by the IRS in 2006, he apparently decided to skate on filing amended returns for 2001 and 2002 when he did the same thing because he was past the statute of limitations, or so they claim. The only reason he paid up now was due to his nomination as Treasury Secretary, otherwise it would have been down the memory hole. Innocent my ass.
Imagine the meet and greet for employees at the IRS for the new boss, the tax cheat.
daleyrocks (5d22c0) — 1/14/2009 @ 8:44 pmAny bets as to whether he paid the tax the following year(s) on the money he was “reimbursed” for “paying” the taxes?
Ed (39e6e8) — 1/14/2009 @ 9:09 pmGeithner believes in change. That’s why he held onto all of his instead of giving it to Uncle Sam.
Ron Paul fans rejoice! You’re getting a libertarian in charge of monetary policy after all.
Icy Texan (b7d162) — 1/14/2009 @ 9:11 pm“Ron Paul fans rejoice! You’re getting a libertarian in charge of monetary policy after all.”
Icy – Those loons still want a gold standard.
daleyrocks (5d22c0) — 1/14/2009 @ 9:36 pmSorry, daleyrocks. I don’t do sarc. tags.
Icy Texan (b7d162) — 1/14/2009 @ 9:48 pmIf Geithner was a Republican nominee for a cabinet post in a Republican Administration it would be bad. But Geithner has been nominated by the One to help bring Hope ‘n Change. He will sail through.
Stu707 (7fb2e7) — 1/14/2009 @ 9:49 pmGeithner will skate on this one. The Dems will line up behind Reid and Obama. And the Republicans will get on board because they know the next pick could be a whole lot worse (having learned their lesson when they helped throw Kimba Wood under the bus, and got Janet Reno as AG).
Roscoe (bf8a22) — 1/14/2009 @ 10:45 pmIsn’t his trial the place where Geithner is supposed to make the excuses? Did Bush’s injustice department go home already or are they busy drafting the criminal complaint against Geithner?
j curtis (fda0c3) — 1/14/2009 @ 11:07 pm[…] failed to pay far less in taxes. And as for the mistake itself–tax simplification or no–it was quite a doozy. Quite a doozy. Have I mentioned how much of a doozy this mistake […]
What Happens When The Incoming Treasury Secretary Can’t Do His Own Taxes? - Pejman_Yousefzadeh’s blog - RedState (796605) — 1/14/2009 @ 11:28 pm[…] failed to pay far less in taxes. And as for the mistake itself–tax simplification or no–it was quite a doozy. Quite a doozy. Have I mentioned how much of a doozy this mistake […]
ChooseTheHero.com » Blog Archive » What Happens When The Incoming Treasury Secretary Can’t Do His Own Taxes? (c8cd02) — 1/15/2009 @ 12:01 am[…] failed to pay far less in taxes. And as for the mistake itself–tax simplification or no–it was quite a doozy. Quite a doozy. Have I mentioned how much of a doozy this mistake […]
ChooseTheHero.com » Blog Archive » What Happens When The Incoming Treasury Secretary Can’t Do His Own Taxes? (c8cd02) — 1/15/2009 @ 12:01 amAHHH ignorence is bliss and repsponsebilty isnt a requirement. Dictator ship atleast allows agood argument that these people were forced upon us. Hell somebody voted him into office!
rustyW (dda662) — 1/15/2009 @ 2:34 amErrr…. I encountered exactly this situation as a military wife who transitioned from working in the office to working from home in a state my firm isn’t incorporated in.
As such, they decided to stop withholding taxes from my paycheck.
That meant I became, for all intents and purposes, “self-employed” and it was suddenly my responsibility to figure out what that meant in terms of state and federal taxes. And I had to pay dual taxes two years since we were moving back-and-forth.
Guess what? I figured it out and my employer didn’t help me. So what is the standard of care for an incoming Treasury Sec?
Less than for a military wife with a Bachelor of Science?
Cassandra (6f0d0c) — 1/15/2009 @ 6:59 amAs a tax cpa, I will tell you this guy is a tax cheat PERIOD. I talk to my “self-employed” clients all the time about payroll taxes. “Honest mistake” you say…then he isn’t bright enough to be Secretary of the Treasury. I can’t wait to talk to the IRS. My client made an “honest mistake”….so we will let it go, right? He will do better next time. And, of course, no penalties!
Mike (23ba78) — 1/16/2009 @ 10:43 amWhat do you mean, Mr. IRS, that is how your boss does it!