The public figures forced to make public apologies for errors on their taxes this week are the latest in a long line of taxpayers who have learned the hard way that the tax man always cometh.
Tom Daschle withdrew his nomination to be President Barack Obama's health-care boss after problems with his unpaid back taxes came to light. Mr. Daschle's announcement occurred hours after Nancy Killefer bowed out of consideration to be the government's first chief performance officer due to her own tax errors.
Treasury Secretary Tim Geithner was the first Obama nominee to ask for forgiveness for not paying about $40,000 in Social Security and Medicare taxes. His "simple mistake" was just a bump on the road to confirmation.
"I don't know that they weren't being completely honest. I believe the tax code itself is a conflicting document," said Kathy Hess, president of Kathy Hess & Associates in Upper St. Clair. "There are a lot of conflicting regulations that are not deemed right or wrong until you get to the appeals level."
Internal Revenue Service officials estimate about $345 billion in taxes, which represents about 14 percent of all tax liabilities, went unreported and unpaid in 2001, the latest year for which data is available.
But the IRS isn't giving anyone a free pass and wields the audit as a weapon to curtail cheaters.
"The IRS is the most efficient tax collecting agency in the world," said James Lange, president of Lange Financial Group in Squirrel Hill. "The only reason the IRS even bothers with a small fry is to send a message to other small fries."
Government agents analyze the likelihood of taxpayers under-reporting income or over-reporting deductions, which means high-income tax returns are scrutinized more closely.
"What the IRS looks at a lot is people who are self-employed," said Howard Davis, president of Davis, Davis & Associates, a Downtown accounting firm.
"They question whether the expenses are really legitimate business expenses and not personal expenses."
Mr. Daschle said he didn't realize he owed taxes for the use of a car and driver lent to him from 2005 to 2007.
Ms. Killefer's downfall was her failure to pay employment taxes for a housekeeper.
Alex Kindler, an accountant with the Horovitz Rudoy & Roteman accounting firm, Downtown, said the complexity of the transactions in which some high-income earners are involved plays a role in their tax problems.
For instance, he said it was easy for an accountant to prepare the forms to report wages paid to housekeepers, but often clients don't tell their accountant they have household help.