Former Dallas Mayor Among Latest Obama Appointees With Tax Issues

Former Dallas Mayor and U.S. Trade Representative Designate Ron Kirk has agreed to pay an estimated $10,000 in back taxes incurred earlier this decade, Senate Finance Committee Chairman Max Baucus (D-Mont) announced Monday.

The back taxes result from the way Kirk handled speaking fees he donated to a scholarship fund he set up at his alma mater, and for deducting the full cost of season tickets to Dallas Mavericks basketball games, according to the Associated Press.

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Kirk also agreed to make changes in his accounting of charitable deductions, including reducing the claimed value of a donated television from $3,000 to $1,500.

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Finance Committee Chairman Max Baucus, D-Mont., called Kirk “the right person for this job” and said in a statement he will try to have the nomination move through his panel quickly.

Kirk agreed to file an amended tax return this week, Baucus’ office said.

Sen. Charles Grassley, of Iowa, the top Republican on the committee, said through an aide that he is reserving judgment until the vetting process on Kirk is complete. Kirk is scheduled to testify at a confirmation hearing next Monday.

Kirk, who was Dallas mayor from 1995 to 2001, is a partner in the Dallas office of the Vinson & Elkins law firm. He received $556,740 from the firm last year and a total of $460,265 from serving on the boards of PetSmart, Dean Foods and Brinker International, a restaurant company, according to financial disclosure reports released by the Obama administration.

His tax problems arise out of speaking fees that he routinely paid directly to Austin College in Sherman to support a scholarship fund but did not list on his tax returns, according to the Finance Committee report.

The panel said Kirk should have listed the fees as income and claimed them as charitable donations.

Last fall, the Internal Revenue Service notified Kirk that he had failed to report a $5,000 speaking fee, as well as dividend income of $816, from 2006. Kirk paid $2,327 in back taxes and interest in October, the report said.

The disclosure led to questions from the Finance Committee aides, who found that Kirk had also failed to report a total of $37,750 in fees from about 16 speaking engagements from 2004 through 2007.

The estimated effect was to reduce Kirk’s tax bill by $5,800, according to the committee report.

Kirk’s tax problems are far more mild than those of other Obama nominees, so I doubt confirmation will be much of a problem.

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