auditcongress.com

Kansas Governor Kathleen Sebelius is likely to soon be confirmed as the new Secretary of Health and Human Services despite revealing that she had underpaid her taxes by roughly $7,000.00  It is unfortunate that she is also another in a long line of public officials who seem to have trouble paying their appropriate taxes on time.

A major difference this time is that Kathleen Sebelius had her CPA review her tax returns for 2005, 2006, and 2007, and found that she hadn't properly paid her taxes.   In other words, she had herself voluntarily audited, which is precisely the idea what we are trying to put into place here at Audit Congress.   Audits can help ensure compliance.

She voluntarily submitted to the audit, caught the discrepancies, paid the difference (plus interest) to the IRS, and then revealed all this to the committee which subsequently approved her nomination to the post.   This action illustrates the real world viability of requiring tax audits for Congressmen and other high government officials: those who want to serve in government cleaning up their tax act, and keeping it clean.

We applaud, and encourage a broad positive recognition for the open and appropriate acts of Kathleen Sebelius!  This was the right thing to do, and we heartily support her audit as an example to be followed by others.

We doubt that anyone would have submitted to such an audit and paid up on their taxes were they not being put under a microscope at Congressional approval hearings.  If the CPA who prepared the previous years' tax returns was the same CPA who conducted the audit, we hope she got a rebate for earlier services.   Who knows, the article doesn't say.

We know the nature of some of the items which were "adjusted", including 3 out of 49 charitable and business deductions which were improperly documented and a mortgage interest deduction which was improperly applied.   These adjustments were disclosed in a news article and do not appear to be deliberate attempts to evade taxes.  Rather they illustrate how tough it can be to fully comply with the tax code regardless of intent.   Perhaps regular tax audits will bring home to Congress the unnecessary burden placed upon everyday Americans by the convoluted tax code they themselves have put into place.   In Secretary Sebelius’ home state of Kansas, Wayne Godsey, KMBC President And General Manager penned an editorial today on this subject.  Here is the heart of the editorial:

    "Kan. Gov. Kathleen Sebelius has become another in a long line of Cabinet nominees to admit underpaying income taxes. Assuming the errors were unintentional, as she claims, it raises the question of whether our tax code is just too complicated. Highly educated people have to hire accountants to prepare their returns.

The tax code was intended to raise money to finance the functions of government. But it has become a way for government to encourage or penalize actions of businesses and individuals. With thousands of provisions for every imaginable purpose, the code has become so complicated that even IRS experts get things wrong."

Simplifying the tax code is not the focus of Audit Congress. We intend to help Americans to implement audits at the highest levels of the Federal government. However it wouldn't hurt our feelings if congressional audits helped build a congressional consensus for simplifying the tax code.

We congratulate the Secretary nominee of HHS, Kathleen Sebelius, and applaud her for undergoing a voluntary audit. We would feel better, however, if in the future Secretary Sebelius was audited every year, as she will be responsible for one of the highest jobs in the government. And we would feel better still if all Congress and high officials were audited every year.

Pete Langlois and Dan Murphy