Taxes haunt another Obama nominee

Another nominee to President Obama’s Cabinet is embroiled in
tax issues, but it is unclear whether they will impede his confirmation by the
Senate.

Former Dallas Mayor Ron Kirk, nominated as Obama’s U.S.
Trade Representative, made several errors on his tax returns, according to a
report released Monday afternoon by the Senate Finance Committee. He has agreed to pay $9,975 in additional taxes to make up for the errors, the report said.

{mosads}The report said Kirk will file an amended return next week.
The panel is also postponing a confirmation hearing for Kirk, initially
scheduled for Thursday, until March 9.

The report reveals that Kirk did not report $37,750 in
speaking honoraria as income for tax years 2004, 2005, 2006 and 2007. Instead,
Kirk asked that the honoraria be assigned to Austin College, his alma mater,
to help fulfill a pledge he made for a scholarship fund.

According to the report, Kirk later determined that the
honoraria should have been reported as income and deducted as charitable
donations. The estimated income tax effect of these adjustments, taking into account honoraria already deducted as charitable deductions, is
about $5,800, according to the report.

The report
also mentions other tax problems, including season tickets to the NBA’s Dallas
Mavericks that Kirk reported as a business expense. Some of those deductions
did not qualify as entertainment expenses, according to the report, and as a
result Kirk is adjusting his total expenses. The tax effect, the report said,
would be $2,600.

Despite the problems, Sen. Max Baucus (D-Mont.), the panel’s
chairman, said Kirk “is the right person for this job and I will work to move
his nomination quickly.”

In a joint
statement, Baucus and Sen. Chuck Grassley (Iowa), the panel’s ranking
Republican, said the report and a Monday briefing for panel members would
“ensure the appropriate level of transparency” to ensure all senators can
assess the relevant information for Kirk’s nomination.

It is
unclear whether Grassley will support the nomination.

However, a GOP aide noted that Treasury Secretary Tim Geithner’s problematic tax amounts were larger than Kirk. In addition, Geithner is in charge of tax policy, could make his tax errors more egregious.

Geithner was confirmed despite the problems, but tax problems tripped up Obama’s first nominee for secretary of Health and Human Services, former Senate Majority Leader Tom Daschle (D-S.D.), who withdrew. Both nominees went through the Finance panel.

In a related development, the Obama administration on Monday the president’s agenda for trade. The document said the administration hoped to move quickly on Congressional approval of a trade deal negotiated by the Bush administration with Panama.

On more controversial Bush-era deals with Colombia and South Korea, the report said Obama would establish “benchmarks for progress.” Both deals are opposed by organized labor and many Congressional Democrats, and the deal with South Korea has also drawn opposition from the auto industry.

This story was updated at 4:44 p.m.