Sometimes the Congressional hearings themselves are much funnier than the skit on SNL that might follow on the weekend! I could not help, but think and laugh, as I watched the clips of the Tim Geithner hearing before Congress yesterday.
In case you haven’t followed the hearing too closely, Geithner is most likely going to be the next “top dog” at the Treasury Department, taking the place of “King Henry” Paulson. This is a position that has never been more important, due to the current economic turmoil we are now facing.
Tim Geithner is probably the most qualified person in the world for this job, but “Houston we have a problem”! He made approximately $43,000 in mistakes on his own tax returns… and what is one of the main duties of the Treasury? They head up the IRS and investigate tax evaders! Is this justice? Is this poetic justice? Or has this current economic crisis turned the United States Congress into the Kangaroo court?
Some of the toughest questions and comments that he got were, “I am afraid that we may be sweeping this tax thing under the rug!” and “what tax program did you use?” By the way he used Turbo Tax that is owned by Intuit Inc. (INTU) and the stock tanked when he said this, but it did recover, as he explained, that it was not that tax programs fault! From my experience it was definitely not Turbo Tax!
Whose fault was it?!? All kidding aside, Mr. Geithner took full responsibility, and he did pay all the taxes owed plus penalties from the mistakes. As a tax preparer myself, I can vouch for Mr. Geithner and see that his mistakes were not that bad. He failed to pay into Social Security/Medicare for his own self employment, and I have prepared tax returns for a lot of smart people that just sometimes can’t see this one! He also got too aggressive with deducting his children’s “overnight” camp, when only “day” camp is eligible for the dependent care deduction. Not really that big of a deal at all. Do you have a tax question?
I just hope he now knows that the self employed people have to pay into the Social Security and Medicare systems, because we certainly can’t afford to have the “Tax Man” not collecting for all the failing Federal programs!
Before you come down too hard on Geithner, make sure your own “tax house” is in order.
This is a great opportunity to re-evaluate your own tax philosophies. If someone can make these kinds of mistakes and then become head of the Treasury Department, you shouldn’t get too stressed out about your own taxes, and just make certain you are taking all the deductions you are entitled to. However, we all have to pay some taxes, and we need the government services and infrastructure in which they pay for.
This is just a perfect example of where people that understand the tax system can see where there is just an error and it was not “raw unethical tax evasion”. Raw unethical tax evasion is quite obvious, and if you are doing this you should be stressed out!
Your tax philosophy should be as balanced as your retirement portfolio, and something like, “you don’t want to over pay your taxes and you don’t want to under pay your taxes.”
Finally, realize that the tax system is a sort of honor system to a certain degree with some checks and balances in the form of w-2’s,1099’s etc… But when you are audited, it is then more like a Communist system and you just better do what you are told… ask only a few questions and then pay what you are told to pay.
Do you think Tim Geithner should be head of the Treasury because of his tax mistakes? Please post your own thoughts below..
Sincerely,
Bob O’Brien
Sr. Instructor
Did you like this article?
Submitted By 
's
