Treasury pick's tax problems not seen as show-stopping

Senate Finance Committee Chairman Max Baucus, D-Mont., said Tuesday that he continues to support Treasury Secretary-designate Timothy Geithner despite revelations that he failed to pay $34,000 in taxes and paid an undocumented immigrant as a housekeeper.

"I am disappointed in the errors found in Tim Geithner's tax returns and other information, but I am satisfied that Mr. Geithner has taken the steps necessary to fix these problems," Baucus said in a statement after his committee received new documents on Geithner from President-elect Obama's transition team.

Senate Majority Leader Harry Reid, D-Nev., also said he continues to back Geithner's nomination. "Timothy Geithner is a person that is extremely well qualified to be one of the finest Treasury secretaries we have ever had," Reid said. "There are a few little hiccups, but that is basically what they are.

"I am not concerned [about his nomination] at all," Reid added. "The hearing, I think, will go very well in the Finance Committee."

But Senate Minority Whip Jon Kyl, R-Ariz., objected to fast-track treatment for Geithner, which would have allowed the committee to hold a hearing Friday on less than the required one-week notice. Kyl's objection means Geithner will not be ready to be sworn in when Obama takes office.

Obama's transition team discovered the problems while investigating Geithner's background, and Geithner paid most of the past-due taxes days before Obama announced his nomination in November, according to the committee.

"He's dedicated his career to our country and served with honor, intelligence and distinction," said incoming White House spokesman Robert Gibbs in a statement. "That service should not be tarnished by honest mistakes, which, upon learning of them, he quickly addressed."

Some Republicans on the Finance Committee are warming to Geithner. "I'm confident in the man's ability," said Sen. Orrin Hatch, R-Utah. "It was an error and a mistake that human beings can make and look, if we want perfection around here, we'll never have anybody for any of these positions."

Geithner failed to pay self-employment taxes for money he earned while working for the International Monetary Fund from 2001 to 2003, documents provided by the Finance Committee show. He also did not realize that a housekeeper he paid in 2004 and 2005 did not have current employment documentation as an immigrant for the final three months she worked for him, the committee said.