13 Bailed Out Firms Owe Back Taxes

2 Firms Owe More Than $100 Million Each, Says Chair Of House Committee Overseeing Bailout

(CBS/AP)  At least 13 firms receiving billions of dollars in bailout money owe a total of more than $220 million in unpaid federal taxes, a key lawmaker said Thursday.

Rep. John Lewis, chairman of a House subcommittee overseeing the federal bailout, said two firms owe more than $100 million apiece.

"This is shameful. It is a disgrace," said Lewis, D-Ga. "We are going to get to the bottom of what is going on here."

The House Ways and Means subcommittee on oversight discovered the unpaid taxes in a review of tax records from 23 of the firms receiving the most money, Lewis said as he opened a hearing on the issue.

The committee said it could not legally release the names of those companies owing taxes. It said one recipient had almost $113 million in unpaid federal income taxes from 2005 and 2006. A second recipient owed almost $102 million dating to before 2004. Another was behind $1.1 million in federal income taxes and $223,000 in federal employment taxes.

"If we looked at all 470 recipients, how much would they owe?" Lewis asked.

Banks and other firms receiving federal money were required to sign contracts stating they had no unpaid taxes, Lewis said. But he said the Treasury Department did not ask them to turn over their tax records.

Neil Barofsky, special inspector general for the Troubled Asset Relief Program, told the hearing that if an executive signed a contract knowing that information about unpaid taxes was false, "that would potentially be a crime." He said his office will look to see if crimes were committed.

People will ask, said Rep. Artur Davis, D-Tenn., why there are "large companies getting taxpayer dollars, making false representations, and we can't even name them, much less make them pay the money back, much less prosecute them."

Davis continued: "Will they get their day on a billboard, hopefully?"

"Absolutely," said Barofsky. If someone lied, he said. "They need to be prosecuted."

The revelation is sure to spark outrage on Capitol Hill, where the House is expected to vote Thursday on a bill that would impose steep taxes on employee bonuses at firms that have received bailout money.

"I think we're on the path to where at least most of the money is going to be given back," Michael Santoli, associate editor at Barron's, told CBS' The Early Show. "I do think this crescendo of outrage has basically had its effect in that regard."

To date, the Troubled Asset Relief Program, or TARP, has paid out more than $300 billion to private companies, with billions more on the way.

[jediservant]

This is total bull, I just received a bill from the IRS for year 2007 when I rolled my IRA over. They think I took the distribution and want me to pay $18K on a $45K IRA.

It is time to take back America!

[DocD--2008]

"Banks and other firms receiving federal money were required to sign contracts stating they had no unpaid taxes, Lewis said. But he said the Treasury Department did not ask them to turn over their tax records. "

Maybe the Treasury Department should start talking with the IRS...

[jxknowles]

The economy was in downfall for two years and currently on life support. Most states themselves have billions of unpaid taxes on their books from a variety of businesses and indivduals. Just pick up a newspaper to see for yourself.

Some said the IRS was evil. Now they aren't doing their job. This is almost laughable. Let's start spending our time figuring out a real recovery path. Squeezing blood from a stone doesn't work.

[credibility2]

And why hasn't the IRS been doing its job to aggressively go after these business tax scoffers? The Feds are useless. All of the agencies seem to be doing what a lot in Congress continue to do, and that is to keep collecting a paycheck and do as little work as possible. Businesses and individual taxpayers will continue to not pay what they owe so long as the IRS does nothing aggressively about going after them and collecting. I'm sure the previous and the current administrations know full well which companies owed what money and looked the other way. What a bunch of spineless gutless nincompoops.

[quapawsix]

Wow this whole money system is so corrupt it unreal how can Washington fix anything when they are to busy voting to keep their pay raises in place AIG bonuses and now this multi - Million Dollar Companies not paying taxes then Dufus Boy Dodd got caught in a lie. I think my question is are you entertained I mean are you not entertained what a circus these guys are Grade A Clowns. Just another example of the failed GOV/CORP system.

[rational_1]

"13 Bailed Out Firms Owe Back Taxes" - and I thought this bailout nonsense couldn't get any better. These firms probably had TurboTax Timmy do their taxes for them. Honest mistakes - could have happened to anyone. LOL

[grabandgo]

SEEMS LIKE THE MAN IN CHARGE ISN'T REALLY IN CHARGE!

[red1952]

Let's see what the dirty repubs are going to have to say about these BACK taxes. You know, the ones not paid under THEIR watch. These guys have brought our country to ruin in the eight years while in office and are now outraged...outraged at what is happening. It's time to start talking term limits again and start booting these idiots out of office. If we had only done that to Bush and his ilk, things might be different.

[barbaraf4]

So let me see.....we are using taxpayers' money to pay back taxes?

[platteman]

Obanaana should just do what he said people should say to drugs, just say no to any bailouts!!!!

[happyass3]

How is it news when a finacially troubled firm hasn't paid its taxes on time? What is it about financially troubled that the congressman from GA doesn't understand? Does he expect that these companies will just round trip the payments, put their employees out on the street and go under???? Sometimes I wonder how these guys were able to get elected.
Posted by olyboy at 8:55 AM : Mar 19, 2009



I think the point is that if they couldn't afford to pay their taxes all those years then why were the executives still getting their million dollar bonuses. That is what the fuss is about.

[middleclassmoron]

the companies will pay their back taxes with bailout money (our money). The government will say it has been paid and they in all of their infinite wisdom will believe we bought the idea!!! Does anyone remember when people that didn't pay their taxes actually committed suicide. what a concept. Lets see the IRS drive some of them to suicide. How I forget, many of the congress would need to be replaced!

[simplypissed]

It is ok they just used Turbo Tax Just like Geithner - that's funny

[simplypissed]

why shoudl the companies pay their taxes when the politicians that approved the bailouts haven't paid their taxes - a quick and simple way to cure the federal deficit would be to get congress, and all of the appointees to actually pay what they owe - if you noticed, a number of Obama's nominees had tax issues - I am sure it is as bad on the other side of the aisle. Yet, if one of the 'people' does pay, the IRS comes marching in like the gestapo and throws you in jail. I guess being an elected official has its privilages as you don't have to answer to the law that rules the common people. It is also rather hyporcritic that congress complains nostop about bonues and raises at private companies, yet the last time I checked it has been around 10 years since the government actually had a surplus (in other words made money) yet congress keeps giving themselves raises, have car service vouchers, free healthcare, free food - every single one of them should be investigate - the fleecing of America is centered in Washington, not New York, not at some hedge fund - but with the elected crooks (oops - I mean officials) that runt his country. We have all become a bunch of whimps that have our hands out and can't do anything for ourselves - we all feel entitled, and congress loves being big borther and handing out the goodies. Wait until the music stops and your dollar becomes the yuan and we are all speaking chinese because they own us. We are facing a disaster and all that people on this site does is argue about who's fault it is - who gives a sh** - fix the f'n problem or shut the F up.

[renonv5]

"If we looked at all 470 recipients, how much would they owe?" Lewis asked.

If you think "we the people" were outraged about AIG piglets, wait till you see us after you investigate all 470 recipients. If they can get away without paying taxes what leg will you fall on when "we the people", who you so easily forget about, don't pay our taxes???? You will be setting a precedent here, so be very careful on how you proceed.

[winstrv]

What does it take for these politicians to do their jobs? They allow a tax cheat to be confirmed as Treasury/IRS chief but want to express outrage at these firms when they don't pay their taxes? Don't confirm criminals and don't give these tax cheats any of the taxpayers money. In fact, prosecute those who haven't paid their taxes to include the new Treasury Secretary. Wow, prosecute those who break our laws. What a concept!

[olyboy]

How is it news when a finacially troubled firm hasn't paid its taxes on time? What is it about financially troubled that the congressman from GA doesn't understand? Does he expect that these companies will just round trip the payments, put their employees out on the street and go under???? Sometimes I wonder how these guys were able to get elected.

[clancy49]

No surprise here. No one legally has to pay IRS. The illegal Federal Reserve Bank only strong arms the middle class. The super wealthy are their buddies and can get away with anything including murder. That's the way it is folks. Now if you think the government will force these guys to pay those back taxes, well I have an investment property in Southern Florida in the middle of the Everglades you might be interested in. It is prime land with all the ammenities. Right! Prepare for the tax axe to fall on the middle class with this hyper spending, the rich elite aren't going to do it and they know they can get away with it.