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More on Geithner and little people

June 23, 2010

A commenter on yesterday's post about the Parker Tax Court case, where a taxpayer got hit with penalties for tax positions that weren't considered a serious problem when Tim Geithner became Treasury Secretary:

This overlooks the fact that in Geithner's case the statute of limitations for assessing additional tax had expired. Geithner wasn't charged a penalty because at that point he had no obligation to pay the tax although he did. The statue of limitations for crediting his Social Security account have also expired so he will get no benefit from the taxes paid; Parker will.

Yes, the statute had expired. That still doesn't make Mr. Geithner look good.

Mr. Geithner made a big show of paying his "taxes." But he didn't, really. He doesn't put himself in the same position as other taxpayers if he doesn't pay the same penalty as other taxpayers who did the same thing but got caught.

More importantly, the case shows that Geithner didn't make a really innocent mistake. The Tax Court says that what he did was far enough out of line that it should be subject to an accuracy-related penalty of 20%. This wasn't a matter of botching a complex computation. He just ran a red light, each year. Hardly a great example for the head of an agency that will be leaning harder than ever on taxpayers in the coming years.