Health pick Daschle apologizes for tax issue

WASHINGTON (Reuters) - Health Secretary-designate Tom Daschle apologized in a letter released on Monday for errors that prompted him to pay $140,000 in back taxes, saying he was “deeply embarrassed” and would answer any questions a Senate panel had about them.

Former Senator Tom Daschle testifies before the Senate Health, Education, Labor and Pensions Committee hearing about his confirmation for Secretary of Health and Human Services on Capitol Hill, January 8, 2009. REUTERS/Larry Downing

“I apologize for the errors and profoundly regret that you have had to devote time to them,” Daschle said in a letter to Sen. Max Baucus, the chairman of the Senate Finance Committee, and Sen. Charles Grassley, the top Republican on the panel.

“I will be happy to answer any committee members’ questions about these issues,” Daschle, a former Senate majority leader, told the senators in a letter dated Sunday.

“As you can well imagine, I am deeply embarrassed and disappointed by the errors that required me to amend my tax returns,” he added.

The letter does not mention the exact amount in back taxes that Daschle paid, but The Washington Post reported the sum at about $140,000 in taxes and interest.

Daschle was scheduled to appear on Monday before members of the Senate Finance Committee, the Post said.

In the letter, Daschle said the tax issue stemmed from his use of a car service offered to him by a close friend and consulting client.

He said when he was being considered for the position of health secretary for U.S. President Barack Obama in the fall, the president’s transition team flagged charitable contributions they felt were in error.

Daschle said when his accountant realized he would have to file amended returns, he suggested addressing the issue of the car service as well.

“In December, my accountant advised me that it should be reported as imputed income in the amended returns,” Daschle wrote in the letter.

“In an effort to ensure full compliance and the most complete disclosure possible of my personal finances, we remedied these issues by filing amended tax returns with full payments, including interest,” he said.

Daschle said “my mistakes were unintentional” and that he had “disclosed this information to the committee voluntarily, and paid the taxes and any interest owed promptly.”

Daschle is not the first high-profile nominee for Obama’s Cabinet to run into trouble with taxes. Treasury Secretary Timothy Geithner’s nomination faced criticism for his late payment of $34,000 in self-employment taxes to the IRS. He was eventually confirmed.

Editing by Doina Chiacu