Tax Problems with ANOTHER Obama Nominee

[Quadratus]

LOL, Another one bites the dust!

http://www.comcast.net/articles/news...ebelius.Taxes/

WASHINGTON — Health and Human Services nominee Kathleen Sebelius recently corrected three years of tax returns and paid more than $7,000 in back taxes after finding "unintentional errors" — the latest tax troubles for an Obama administration nominee. The Kansas governor explained the changes to senators in a letter dated Tuesday that the administration released. She said they involved charitable contributions, the sale of a home and business expenses.
Sebelius said she filed the amended returns as soon as the errors were discovered by an accountant she hired to scrub her taxes in preparation for her confirmation hearings. She and her husband, Gary, a federal magistrate judge in Kansas, paid a total of $7,040 in back taxes and $878 in interest to amend returns from 2005-2007.
Several Obama administration nominees have run into tax troubles, notably the president's first nominee for HHS secretary, former Senate Democratic leader Tom Daschle. He withdrew from consideration while apologizing for failing to pay $140,000 in taxes and interest.
Finance Committee Chairman Max Baucus, D-Mont., quickly issued a statement supporting Sebelius.
"Congress is going to need a strong partner at the Department of Health and Human Services to achieve comprehensive health reform this year, and we have that partner in Gov. Sebelius," Baucus said. "There is absolutely no doubt in my mind that Gov. Sebelius has the political experience, determination, and bipartisan work ethic to get the job done with Congress this year. She's the right person for the job."
There was no comment from the White House.
Sebelius is to appear Thursday before Baucus' committee, which will vote on sending her nomination to the full Senate. Sebelius testified Tuesday before the Senate's Health, Education, Labor and Pensions Committee before the tax issue became public, getting a friendly reception.
Sen. Chuck Grassley of Iowa, the top Republican on the Finance Committee, said through a spokeswoman that he is reserving judgment until the vetting process, including the nomination hearing, is completed.
In her letter to Baucus and Grassley, Sebelius wrote that the accountant discovered these errors:
_Charitable contributions over $250 are supposed to include an acknowledgment letter from the charity in order for a deduction to be taken. Out of 49 charitable contributions made, three letters couldn't be found.
_Sebelius and her husband took deductions for mortgage interest that they weren't entitled to. The couple sold their home in 2006 for less than what they owed on the mortgage. They continued to make payments on the mortgage, including interest. But since they no longer owned the home they weren't entitled to take deductions for the interest. The same thing happened with a home improvement loan. Sebelius said they "mistakenly believed" the payments were still deductible.
_Insufficient documentation was found for some business expense deductions.
An administration official said Sebelius filed the amended returns before documents formalizing her nomination were sent to the Finance Committee. Sebelius advised the committee of the mistakes, and senators requested an explanation, said the official, speaking on condition of anonymity because of the sensitivity of the issue.
In a letter to Sebelius dated Tuesday, Baucus and Grassley wrote that they'd reviewed the three years of amended returns and "no additional items were identified that needed to be addressed."
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[Clouse123456]

oh boy!

[Viking Prince]

Charitable contributions over $250 are supposed to include an acknowledgment letter from the charity in order for a deduction to be taken. Out of 49 charitable contributions made, three letters couldn't be found.

_Sebelius and her husband took deductions for mortgage interest that they weren't entitled to. The couple sold their home in 2006 for less than what they owed on the mortgage. They continued to make payments on the mortgage, including interest. But since they no longer owned the home they weren't entitled to take deductions for the interest. The same thing happened with a home improvement loan. Sebelius said they "mistakenly believed" the payments were still deductible.

_Insufficient documentation was found for some business expense deductions.

If these are the extent of the problem -- this is more an argument for cleaning up the tax code. Missing 3 letters out of 49? A complex real estate transaction handled incorrectly for tax purposes? Some missing documentation for some business expenses? This is mundane and run of the mill stuff of ordinary audits.

If this was an actual IRS audit of an ordinary Joe, one the interest deduction on the hose would have been challanged and paid in a compromise with the auditors. The missing paper work on the rest would have been accepted as long as the concession on the real estate was admitted. No penalties, just interest would have been assessed.

This should not disqualify her from the appointment. Clearly this changes if there is more to the story.

[GrnEyedDvl]

This should not disqualify her from the appointment. Clearly this changes if there is more to the story.

I am no fan of Obama, but I have to agree. A $7000 dollar mistake can be made fairly easily, though it pisses me off that whoever prepares the taxes for you doesnt have to pay the penalty.

This is far different than the $135,000 "mistake" made by one of his other appointees.

[Nevins]

This is nothing short of comedic. You would almost have to be TRYING to get these sorts of results. And I thought it was the Republicans who were the rich bastards that dodged taxes.

[Viking Prince]

This is nothing short of comedic. You would almost have to be TRYING to get these sorts of results. And I thought it was the Republicans who were the rich bastards that dodged taxes.

I am not certain about the wealth today in Congress, but last I looked a few years ago -- the Democrats were far wealthier than the Republicans serving as elected officials.

[Clouse123456]

This is nothing short of comedic. You would almost have to be TRYING to get these sorts of results. And I thought it was the Republicans who were the rich bastards that dodged taxes.

Yes but its democrats who always raise taxes.So its highly hypocritcal to want to raise taxes on the populace but not pay your own.The Dems have a proven and have a know record for raising taxes or wanting higher taxes.
Btw Obama a democrat and is only repeating this past history.
For example Obama's redistribution of wealth.Where does that wealth come from?Ill tell you taxes!Higher taxes!

The Repubs are completely opposite for the most part.There are exceptions however.

[Gaidin]

Yes but its democrats who always raise taxes.So its highly hypocritcal to want to raise taxes on the populace but not pay your own.The Dems have a proven and have a know record for raising taxes or wanting higher taxes.

What does this have to do with classic mistakes that can be made by any accountant?

[The Devil's Sergeant]

It is easy as hell to make small mistakes like she has. If and when you get a decent income, start buying and selling homes and build up a portfolio, keeping everything documented for years on end gets to be rediculously complicated, way more than it ever should be.

I got a letter lasty week that the IRS wants about $1000 from me for 2007. They won't be getting it though, its their effing mistake.

Tom Daschle and Tim Geithner on the other hand didn't make mistakes. They genuine intentional tax cheats. Sebelius, atm, appears to be simply ensnared by the dizzying complexity of the tax code. All te more reason we need the elegant and simple Fair Tax.

[Nevins]

Tom Daschle and Tim Geithner on the other hand didn't make mistakes. They genuine intentional tax cheats. Sebelius, atm, appears to be simply ensnared by the dizzying complexity of the tax code. All te more reason we need the elegant and simple Fair Tax.

Well, then she can blame those scumbags for making it seem as if she is just another tax dodging Obama employee.

And I totally agree, our current tax system needs a serious overhaul and simplification that will tie in more with the digital age that we are living in. Taxes shouldn't need to be so insanely complicated.

[Boer]

$7,000 over 3 years (including one where a house is sold) is not really that large. I actually know "average" Americans who owe this kind of money. Tom Daschle's $140,000 on the other hand is the kind of tax debt that would take the average American around 15 years to create.