# Obama's treasury nom delinquent in tax. Anyone care? **URL:** \ **Category:** Great Debates\ **Created:** [January 14, 2009, 5:15pm UTC](https://boards.straightdope.com/t/obamas-treasury-nom-delinquent-in-tax-anyone-care/481277 "2009-01-14T17:15:50Z")\ **Posts on this page:** 15\ **Page:** 2
**Author:** ![UncleBeer](https://avatars.discourse-cdn.com/v4/letter/u/977dab/32.png) [@UncleBeer](https://boards.straightdope.com/u/UncleBeer)\ **Post date:** [January 15, 2009, 7:48pm UTC](https://boards.straightdope.com/t/obamas-treasury-nom-delinquent-in-tax-anyone-care/481277/21 "2009-01-15T19:48:34Z")
Yeah, but when they do, the check stub shows that. If it ain’t on there, it seems a simple assumption that it’s not being paid. At that point, a question to your employer’s accountant would seem in order. This guy apparently made no inquiries, or didn’t look at his check stub, or review his tax filings, over four entire fucking years? ---
**Author:** ![Nom\_de\_Plume](https://avatars.discourse-cdn.com/v4/letter/n/85f322/32.png) [@Nom\_de\_Plume](https://boards.straightdope.com/u/Nom_de_Plume)\ **Post date:** [January 15, 2009, 9:03pm UTC](https://boards.straightdope.com/t/obamas-treasury-nom-delinquent-in-tax-anyone-care/481277/22 "2009-01-15T21:03:14Z")
> [@DrDeth](#): > > He wasn’t self-employed. Thus, you don’t know what you’re talking about. IANAL, but I was reading about this in the Wall Street Journal ([cite](http://online.wsj.com/article/SB123194884833281695.html?mod=article-outset-box)) That said : > [@](#): > > In a wrinkle in U.S. tax law, U.S. citizens at the IMF pay Social Security and Medicare taxes as if they were self-employed.. ---
**Author:** ![EddyTeddyFreddy](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/eddyteddyfreddy/32/18796_2.png) [@EddyTeddyFreddy](https://boards.straightdope.com/u/EddyTeddyFreddy)\ **Post date:** [January 15, 2009, 9:04pm UTC](https://boards.straightdope.com/t/obamas-treasury-nom-delinquent-in-tax-anyone-care/481277/23 "2009-01-15T21:04:12Z")
When I worked for state government as a 1099 “consultant”, I had withholding on a W-2, even though I wasn’t an official employee, of both state and federal taxes. However, because state employees don’t (or didn’t then, anyway) have federal Social Security taxes withheld, since they are/were covered by the state’s equivalent, we 1099ers got an IRS letter ruling stating that we didn’t have to pay SS taxes either. My understanding is that Geithner was in somewhat of the same position with the IMF – not an employee but with income tax withholding on a W-2. If he inquired of an accountant whether he had to pay SS tax and was told no, I can see him believing it was correct advice. ---
**Author:** ![DrDeth](https://avatars.discourse-cdn.com/v4/letter/d/b487fb/32.png) [@DrDeth](https://boards.straightdope.com/u/DrDeth)\ **Post date:** [January 15, 2009, 9:05pm UTC](https://boards.straightdope.com/t/obamas-treasury-nom-delinquent-in-tax-anyone-care/481277/24 "2009-01-15T21:05:57Z")
> [@UncleBeer](#): > > Yeah, but when they do, the check stub shows that. If it ain’t on there, it seems a simple assumption that it’s not being paid. At that point, a question to your employer’s accountant would seem in order. This guy apparently made no inquiries, or didn’t look at his check stub, or review his tax filings, over four entire fucking years? He did review his tax filings, with a supposed tax expert, who assured him it was fine. That’s exactly why the law is written so that if you rely upon expert tax advice, the IRS usually holds you blameless. ---
**Author:** ![DrDeth](https://avatars.discourse-cdn.com/v4/letter/d/b487fb/32.png) [@DrDeth](https://boards.straightdope.com/u/DrDeth)\ **Post date:** [January 15, 2009, 9:09pm UTC](https://boards.straightdope.com/t/obamas-treasury-nom-delinquent-in-tax-anyone-care/481277/25 "2009-01-15T21:09:16Z")
> [@Nom\_de\_Plume](#): > > IANAL, but I was reading about this in the Wall Street Journal ([cite](http://online.wsj.com/article/SB123194884833281695.html?mod=article-outset-box)) That said “pay Social Security and Medicare taxes \*\*as if \*\*they were self-employed” My Bro is a EA, he assures me this is a complex area and not as simple as one may think. There are several variables and complications he sez. **ETF** is correct. Note that the IRS decided that Geithner owed no penalties. ---
**Author:** ![Magiver](https://avatars.discourse-cdn.com/v4/letter/m/4491bb/32.png) [@Magiver](https://boards.straightdope.com/u/Magiver)\ **Post date:** [January 16, 2009, 5:28am UTC](https://boards.straightdope.com/t/obamas-treasury-nom-delinquent-in-tax-anyone-care/481277/26 "2009-01-16T05:28:09Z")
> [@DrDeth](#): > > … > Mr. Geithner fully paid his state and federal income taxes. … However, Mr. Geithner’s accountant told him he was exempt from self-employment taxes, according to Obama transition officials. > . I’d question the competency of a Treasury Secretary who didn’t know that you have to pay taxes on self-employed earnings. The key here is that he was told by his Accountant which is different then not knowing what the Accountant did. ---
**Author:** ![Snnipe\_70E](https://avatars.discourse-cdn.com/v4/letter/s/b5a626/32.png) [@Snnipe\_70E](https://boards.straightdope.com/u/Snnipe_70E)\ **Post date:** [January 16, 2009, 5:55am UTC](https://boards.straightdope.com/t/obamas-treasury-nom-delinquent-in-tax-anyone-care/481277/27 "2009-01-16T05:55:19Z")
> [@spifflog](#): > > The Washington Times had a story this morning stating the Obama’s pick for Treasury Secretary, Timothy Geithner, was delinquent in his taxes to the tune of $35,000. The article went on to say that “Democrats said the delinquent taxes, some of which Mr. Geithner paid only after he learned that Mr. Obama was considering him for the post were and ‘honest mistake.’” > > I’m guessing if this was a Bush appointee, Dopers would be all over this. Does anyone care that the perspective head of the IRS doesn’t always pay his taxes? I would hope that his name would be with drawn. With out a doubt the cry would be loud if Bush had made this appointment. I mean oh gee I just forgot to file the forms I planed on it, give me a brreak. ---
**Author:** ![Magiver](https://avatars.discourse-cdn.com/v4/letter/m/4491bb/32.png) [@Magiver](https://boards.straightdope.com/u/Magiver)\ **Post date:** [January 16, 2009, 6:28am UTC](https://boards.straightdope.com/t/obamas-treasury-nom-delinquent-in-tax-anyone-care/481277/28 "2009-01-16T06:28:50Z")
> [@Tom\_Tildrum](#): > > It’s not a complicated issue that he got wrong, and I’m baffled that an accountant would have told him that he was exempt. Moreover, I’ve seen at least one source say that the IMF gives its American employees some guidance on paying self-employment taxes (this was in Forbes, which is presumably somewhat adversarial to the Obama administration, so make of that what you will). Still and all, I have no problem believing that the errors were not deliberate. > > However, he paid the 2003 and 2004 delinquencies when audited, but he only went back and paid 2001 and 2002 after he was nominated for Treasury. I’m willing to excuse the errors found in the audit. But when Geithner was told that he had handled this issue incorrectly for '03 and '04, for him not to go back and check for (and correct) the same errors in the previous years that he worked at IMF strikes me as much more serious and potentially much less excusable in a nominee for Treasury Secretary. I missed this post the first time through but it’s right on the money. He new damn well he owed back taxes. Once he was audited and didn’t act on the previous years he should have had to pay penalties for not paying the back taxes. ---
**Author:** ![Bryan\_Ekers](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/bryan_ekers/32/183_2.png) [@Bryan\_Ekers](https://boards.straightdope.com/u/Bryan_Ekers)\ **Post date:** [January 16, 2009, 6:32am UTC](https://boards.straightdope.com/t/obamas-treasury-nom-delinquent-in-tax-anyone-care/481277/29 "2009-01-16T06:32:22Z")
> [@Magiver](#): > > I missed this post the first time through but it’s right on the money. He new damn well he owed back taxes. Once he was audited and didn’t act on the previous years he should have had to pay penalties for not paying the back taxes. Are you suggesting he should have volunteered to audit himself over and above what the IRS did? ---
**Author:** ![Mighty\_Mouse](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/mighty_mouse/32/7776_2.png) [@Mighty\_Mouse](https://boards.straightdope.com/u/Mighty_Mouse)\ **Post date:** [January 16, 2009, 6:49am UTC](https://boards.straightdope.com/t/obamas-treasury-nom-delinquent-in-tax-anyone-care/481277/30 "2009-01-16T06:49:12Z")
Never mind. Too much of a hijack. ---
**Author:** ![Mighty\_Mouse](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/mighty_mouse/32/7776_2.png) [@Mighty\_Mouse](https://boards.straightdope.com/u/Mighty_Mouse)\ **Post date:** [January 16, 2009, 7:07am UTC](https://boards.straightdope.com/t/obamas-treasury-nom-delinquent-in-tax-anyone-care/481277/31 "2009-01-16T07:07:58Z")
> [@Bryan\_Ekers](#): > > Are you suggesting he should have volunteered to audit himself over and above what the IRS did? Hell. Yeah. If the IRS audit showed that your accountant was wrong about years 3 and 4, and you know damn well you did the same thing in year 1 and 2, it is dowright fraudulent to ignore it. Now you _know_ you have filed incorrect returns. You don’t have the manufactured “plausible deniability” that your accountant provided. There is a specialty trade in tax accountants too. Something like having the former DA as your defence attorney in a criminal case. They have magical powers. Wink, wink, nod nod. When you leave the IRS, there will be a nice opportunity for you in the private sector, if our “special clients” don’t get slammed. I actually know two people who work for the Bretton Woods Institutions (World Bank and IMF) in Washington DC. One of them is a night security guard. My father does his taxes for him. Even he knows he has to pay the employer portion of social security taxes. They tell you this when you start working there. There are thousands of US citizens or residents working for these institutions. This is not really as esoteric as people are claiming it is. Another works as a contracts administrator (better than a clerical position, but only just). She didn’t pay the employer portion for 10 years (from the early 1990s on). The IRS froze her bank accounts, and siezed her house. They threatened to charge her with criminal fraud. With taxes and penalties she is on track to pay three times the original amount. It is just another case of one set of rules for the well connected, and another for the rest of us. We scream when the pubbies get away with murder. But its all good when it is our own side doing it. ---
**Author:** ![Bryan\_Ekers](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/bryan_ekers/32/183_2.png) [@Bryan\_Ekers](https://boards.straightdope.com/u/Bryan_Ekers)\ **Post date:** [January 16, 2009, 7:36am UTC](https://boards.straightdope.com/t/obamas-treasury-nom-delinquent-in-tax-anyone-care/481277/32 "2009-01-16T07:36:44Z")
Meh, screw that. If I get audited and I’m told I owe such-and-such an amount, I feel no moral obligation to start looking for ways to increase that amount. Granted, it was a smart move for Geithner to take care of the issue, since his vetting was likely to uncover it anyway and create more problems down the line, but if he wasn’t about to hold a major public office, I see no problem with him keeping his mouth shut. And it doesn’t matter if his annual income was a million or ten thousand. ---
**Author:** ![DrDeth](https://avatars.discourse-cdn.com/v4/letter/d/b487fb/32.png) [@DrDeth](https://boards.straightdope.com/u/DrDeth)\ **Post date:** [January 16, 2009, 4:43pm UTC](https://boards.straightdope.com/t/obamas-treasury-nom-delinquent-in-tax-anyone-care/481277/33 "2009-01-16T16:43:41Z")
> [@Magiver](#): > > I’d question the competency of a Treasury Secretary who didn’t know that you have to pay taxes on self-employed earnings. The key here is that he was told by his Accountant which is different then not knowing what the Accountant did. Huh? The earnings were\* not \*self-employed. ---
**Author:** ![DrDeth](https://avatars.discourse-cdn.com/v4/letter/d/b487fb/32.png) [@DrDeth](https://boards.straightdope.com/u/DrDeth)\ **Post date:** [January 16, 2009, 4:46pm UTC](https://boards.straightdope.com/t/obamas-treasury-nom-delinquent-in-tax-anyone-care/481277/34 "2009-01-16T16:46:57Z")
> [@Magiver](#): > > I missed this post the first time through but it’s right on the money. He new damn well he owed back taxes. Once he was audited and didn’t act on the previous years he should have had to pay penalties for not paying the back taxes. No, that’s not tha way it works. If the IRS audits you, and they think prior or subsequent years have similar issues and are worth auditing, then _they_ do so. They instruct you NOT to file any admended returns (until the audit is completed), unless they ask you to. He did correctly. In fact those old years were outside the SoL, and were basicly voluntary contributions. ---
**Author:** ![UncleBeer](https://avatars.discourse-cdn.com/v4/letter/u/977dab/32.png) [@UncleBeer](https://boards.straightdope.com/u/UncleBeer)\ **Post date:** [January 19, 2009, 6:25pm UTC](https://boards.straightdope.com/t/obamas-treasury-nom-delinquent-in-tax-anyone-care/481277/35 "2009-01-19T18:25:49Z")
> [@DrDeth](#): > > He did review his tax filings, with a supposed tax expert, who assured him it was fine. That’s exactly why the law is written so that if you rely upon expert tax advice, the IRS usually holds you blameless. And yet he also never questioned the apparent overpayments of his salary. Your link states that the IMF gave Geithner cash in order to pay the required Social Security and Medicare taxes. He just blindly accepted 3+ years of salary overpayments and tax underpayments. The IRS says it’s a “technicality,” but it sounds to me like willful ignorance. The discrepancies were ignored because they both worked in Geithner’s favor. [Previous page](https://boards.straightdope.com/t/obamas-treasury-nom-delinquent-in-tax-anyone-care/481277.md?page=1)