Thu, Jan 15, 2009 - Page 1 News List

Candidate to head US Treasury faces questions on taxes


Timothy Geithner, US president-elect Barack Obama’s pick to head the Treasury Department and try to fix the economy, will likely face tough questioning at his confirmation hearing after public revelations he failed to pay US$34,000 in taxes several years ago.

Senate Democrats are pressing to schedule a quick confirmation hearing for Geithner tomorrow, hoping to tee up swift approval of his nomination on Inauguration Day next Tuesday. But newly released information about the tax goofs by Geithner, regarded as a brilliant financial markets specialist well-positioned to deal with the nation’s considerable economic problems, could complicate the process.

Republicans have yet to sign off on expediting the hearing, although senior Democrats expressed confidence that the disclosures would do little to slow Geithner’s path to confirmation.

At least one Republican, Senator Orrin Hatch of Utah, said he had “no problem” with Geithner.

Geithner failed to pay self-employment taxes for money he earned from 2001 to 2004 while working for the IMF, according to materials released by the committee on Tuesday.

He paid some of the taxes in 2006, after an IRS audit discovered the discrepancy for taxes paid in 2003 and 2004. But it was not until much later — days before Obama tapped him to head Treasury late last year — that Geithner paid back most of the taxes, incurred in 2001 and 2002.

He did so after Obama’s transition team found that Geithner had made the same tax mistake his first two years at the IMF as the one the IRS found he made during his last two years there.

The panel’s report also said that Geithner briefly employed a housekeeper in 2005 whose legal immigrant work status had lapsed.

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