Questions arise about Treasury Sec. nominee Geithner's tax returns

WASHINGTON -- President-elect Barack Obama's choice to run the Treasury Department and lead the nation's economic rescue disclosed publicly Tuesday that he failed to pay $34,000 in taxes from 2001 to 2004, a last-minute complication that Senate Democrats tried to brush aside as a minor bump on an otherwise smooth path to confirmation.

Timothy Geithner paid most of the past-due taxes days before Obama announced his choice in November, according to materials released by the Senate Finance Committee. He had paid the remainder of the taxes in 2006, after the IRS sent him a bill.

The still-unpaid taxes were discovered by Obama's transition team while investigating Geithner's background. Obama's staff told senators about the tax issues Dec. 5.

Finance Committee Chairman Max Baucus said he still hoped Geithner could be confirmed on Inauguration Day.

"These errors were not intentional; they were honest mistakes," Baucus said after he and other committee members met with Geithner behind closed doors on Tuesday.

Republican senators, who might be expected to raise the most significant objections, did not immediately comment.

After senators met with Geithner, the panel released 30 pages of documents detailing his tax errors — and also how he came to employ a housekeeper whose legal immigrant work status had briefly lapsed in 2005.

Senate Majority Leader Harry Reid dismissed the events as "a few little hiccups," and said he was "not concerned at all" about the impact.

Obama reiterated his support.

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

Geithner, plucked from his job as president of the Federal Reserve Bank of New York to serve as Obama's treasury secretary, told transition officials and senators that he didn't know he owed self-employment taxes when he worked for the International Monetary Fund.