Five Obama appointees incorrectly filed their taxes. Ironically, none of these errors were in the form of an overpayment. They never are.
There are two possibilities. Either these appointees intentionally underpaid their taxes, or they accidentally misfiled them.
- Tim Geithner – January 14, 2009 – Treasury Secretary – $42,702
- Tom Daschle – January 30, 2009 – Secretary of Health and Human Services – $140,167
- Nancy Killefer – February 3, 2009 – Chief Performance Officer – $946.69
- Ron Kirk – March 2, 2009 – Chief Trade Representative – $9,975
- Kathleen Sebelius – March 3, 2009 – Secretary of Health and Human Services – $7,918
I’m going to take the high road and assume that all five tax problems were accidental. However, these are smart, college-educated professionals and politicians. They should be able to understand the tax code. Not only were they unable to understand it, like most government documents, they wouldn’t even be able to read the whole thing. According to Florida Congressman Connie Mack, “Our current tax code is over 17,000 pages long and over 60% of Americans pay someone else to do their taxes for them.” According to Virginia Congressman Bob Goodlatte, “The tax law has grown from 11,400 words in 1914, to seven million words today.” Congressman Goodlatte has also claimed that, “American taxpayers spend $200 billion and 5.4 billion hours working to comply with federal taxes each year, more than it takes to produce every car, truck, and van in the US.”
There is something wrong with this system.
While many of these tax filing errors were likely mistakes (especially Ms. Killefer and Ms. Sebelius), they happened nonetheless. Between these five appointees, there were twelve problems filing taxes. I believe that the underlying issue isn’t dishonesty, but an overly complicated tax system. If the same people who oversee the tax code can’t understand and comply with it, there’s a problem. It’s time to reform the tax code.
Tim Geithner
Tim Geithner was selected to be Treasury Secretary of the United States, a position that includes overseeing the bloated beast itself, the IRS. It was quickly discovered that Mr. Geithner owed $42,702 in back taxes for various reasons including:
- Failure to pay Social Security and Medicare taxes while employed by the International Monetary Fund
- Illegally claiming that his children’s summer camp was a dependent care expense
- Employing an individual who lacked legal immigration status
Tom Daschle
Tom Daschle was considered for Secretary of Health and Human Services until it was discovered that he owed $140,167 in taxes. Mr. Daschle’s offenses include:
- Failure to declare a limousine and chauffeur as taxable benefits (over $250,000 worth)
- Undeclared income ($83,333) from InterMedia Partners earned in 2007
- Declaring tax deductions of $14,963 for unapproved charitable organizations
Nancy Killefer
Nancy Killefer was considered for Chief Performance Officer before her past tax complications were unearthed. Although Ms. Killefer had already resolved her $946.69 tax problem, she joined the list of Obama appointees who withdrew their candidacy due to tax issues. Ms. Killefer’s offence was:
- Failure to pay unemployment compensation to an employee in 2005
Ron Kirk
Ron Kirk was selected as United States Trade Representative on March 18 despite his $9,975 tax issue. Mr. Kirk’s offences include:
- Failure to declare compensation for speeches worth $37,750
- Illegally declaring three seasons of Dallas Mavericks season tickets as qualifying entertainment expenses (without completing the required documentation)
Kathleen Sebelius
Kathleen Sebelius was the second appointee for Secretary of Health and Human Services to have tax problems. Ms. Sebelius’s back taxes amounted to $7,918 for offenses including:
- Declaring three charitable contributions without receiving proper documentation
- Filing mortgage interest deductions after selling a home
- Declaring business expenses without having sufficient documentation
