Sometimes it pays to go with a CPA.
Millions of Americans might be surprised to learn that the man nominated to be the next Treasury secretary — New York Fed President Timothy F. Geithner — did his taxes using the same software they do: TurboTax, a fact revealed in his Senate confirmation hearing yesterday.
Geithner’s tax returns from 2001 through 2004 have become an embarrassment, if not a stumbling block to his confirmation. A 2006 IRS audit informed Geithner that he had failed to pay self-employment taxes in ’03 and ’04, when he directed the International Monetary Fund’s policy development and review department. While being vetted for Treasury secretary late last year, he was told he made the same errors on his ’01 and ’02 returns. He calls them “careless mistakes” that he should have caught and has paid $42,702 in back taxes.
It’s an unlikely image: The man charged with leading this nation out of recession — an architect of the $700 billion financial rescue package — hunched over a computer, surrounded by stacks of paper, trying to figure out his taxes, just like the 18 million other working stiffs who bought TurboTax last year.
And I’m one of those working stiffs; I’ve been using TurboTax since 2001. Hmm. But when I went to my friend who is a CPA and asked him to do my taxes, he took one look at my files, handed me a copy of the software and told me to use it instead and save $100. However, when you’re the president of the New York Federal Reserve and work for the International Monetary Fund, you might consider going with a CPA; it’s not like there aren’t any around either place.
What I think is ironic is that the Republicans are all concerned about this. I thought they were genetically opposed to paying taxes and that anyone who did anything to avoid paying them would be a hero in their eyes. But Mr. Geithner has two strikes against him: first, he’s the nominee of a Democratic president, and second, he got caught.
I am pretty sure TurboTax isn’t too happy about this gaffe, but it can’t be any worse than their current crop of commercials touting their wares. They have actors dressed up as Ben Franklin, Ulysses S. Grant, and Andrew Jackson and made up to look like their portraits on the currency in various shades of green and grey. Unfortunately, it also makes them look like they’ve been exhumed and in an advanced stage of decomposition. I don’t exactly think it’s a good thing to have your product being promoted by a bunch of guys who look like they just woke up from a dirt nap.