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When you're a powerful Congressman and working diligently to increase tax rates to pay for President Obama's health-care plan, we suppose it's easy to lose track of one of your checking accounts. That would be the one at the federal credit union with a balance somewhere between $250,001 and maybe as high as $500,000. And when you're crunched for time and pulling together bills to pass in a rush, we guess, too, that you might overlook several other investment accounts, even if some of them are sizable, such as the ones Mr. Rangel missed at JP Morgan, Merrill Lynch, Oppenheimer and BlackRock.
Oh, and those vacant properties in Glassboro, in southern Jersey? Everybody in Manhattan tries not to think much about New Jersey, so those lots and their as-much-as-$15,000 value must also have slipped down the memory hole. (The New York Post reported yesterday that Mr. Rangel failed to pay property taxes for two of the lots, according to the county clerk's office.)
The Chairman probably isn't doing a lot of dining at KFC, Pizza Hut, Taco Bell or Long John Silver's, either, which may explain why he didn't disclose the $1,001 to $15,000 in stock he owns in Yum Brands, the conglomerate that runs those chain restaurants. Compared to his undisclosed portfolio stake in PepsiCo—$15,001 to $50,000—that's practically a rounding error.
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Among other issues, Mr. Rangel is currently under investigation regarding his use of four rent-stabilized apartments at New York City's tony Lenox Terrace and soliciting donations with his official letterhead for the Charles B. Rangel Center for Public Service at City College of New York, which was itself built with a $1.9 million earmark. Yet another part of the probe is his failure to report $75,000 in income from a rental villa at the beachfront Punta Cana Yacht Club, in the Dominican Republic.
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But the amended filings show that after the sale of a property on West 132nd Street, his outside income that year was somewhere between $118,000 and $1.04 million.
The forms filed by House members provide for a range of value on such transactions, so the precise number isn't publicly known.
Rangel also lowballed his income by as much as $70,000 in 2002, $46,000 in 2003 and $117,000 in 2006, records show.
Only in 2005 did Rangel reveal his total outside income.
Members of Congress are required to disclose all their assets and outside income in an effort to expose possible undue influences.
Rangel's office insists the Harlem Democrat did not conceal any outside income from the IRS and is paid up on his taxes.
The Post revealed yesterday that Rangel is in arrears on New Jersey property taxes -- for property that for more than 15 years he failed to disclose to Congress and the public.
Another area of wide discrepancy in his financial-disclosure forms is where he's required to list financial transactions.
Every year between 2002 and 2007, Rangel failed to include all his deals for the year, according to records.
On his 2002 and 2003 financial-disclosure statements, Rangel did not include any transactions whatsoever, according to papers on file with the House clerk.
But the amended records filed this month show as much as $310,000 in business deals in 2002 and up to $80,000 in transactions in 2003.
In 2004, Rangel left off his disclosure form as much as $430,000 in stock transactions, amended records show. One of those deals he did include as a transaction on his original disclosure was the sale of the brownstone on West 132nd Street.
But in the same report, Rangel failed to include proceeds from that sale as outside income. That has been revised in the amended report.
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The changes approved by the House Ways and Means Committee that Rangel chairs would strip away legal defenses and pile higher penalties on corporate and individual taxpayers facing IRS proceedings for what they claim are unintentional mistakes, experts said.
Rangel's bill would:
* Punish those who fail to alert the IRS to potentially questionable tax exemptions.
* Bar the IRS from waiving penalties against taxpayers who clearly erred in good faith.
* Double fines in certain circumstances.
"The bill raises penalties and eliminates many of the reasonable defenses that taxpayers have always been able to use when honest mistakes are uncovered," one lawyer told The Post.
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Carter, a former longtime Texas judge, today introduced the Rangel Rule Act of 2009, HR 735, which would prohibit the Internal Revenue Service from charging penalties and interest on back taxes against U.S. citizens. Under the proposed law, any taxpayer who wrote “Rangel Rule” on their return when paying back taxes would be immune from penalties and interest.
“We must show the American people that Congress is following the same law, and the same legal process as we expect them to follow,” says Carter. “That has not been done in the ongoing case against Chairman Rangel, nor in the instance of our new Treasury Secretary Timothy Geithner. If we don’t hold our highest elected officials to the same standards as regular working folks, we owe it to our constituents to change those standards so everyone is abiding by the same law. Americans believe in blind justice, which shows no favoritism to the wealthy or powerful.”
Carter also said the tax law change will provide good economic stimulus benefits, as it would free many taxpayers from massive debts to the IRS, restoring those funds to the free market to help create jobs.
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But if the plan envisioned by President Barack Obama and Congressional Democrats is enacted, the primary federal bureaucracy responsible for implementing and enforcing national health care will be an old and familiar one: the Internal Revenue Service. Under the Democrats' health care proposals, the already powerful — and already feared — IRS would wield even more power and extend its reach even farther into the lives of ordinary Americans, and the presidentially-appointed head of the new health care bureaucracy would have access to confidential IRS information about millions of individual taxpayers.
In short, health care reform, as currently envisioned by Democratic leaders, would be built on the foundation of an expanded and more intrusive IRS.
Under the various proposals now on the table, the IRS would become the main agency for determining who has an "acceptable" health insurance plan; for finding and punishing those who don't have such a plan; for subsidizing individual health insurance costs through the issuance of a tax credits; and for enforcing the rules on those who attempt to opt out, abuse, or game the system. A substantial portion of H.R. 3200, the House health care bill, is devoted to amending the Internal Revenue Code of 1986 in order to give the IRS the authority to perform these new duties.
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Much is expected of elected officials. Much more is expected and demanded of those entrusted with chairmanships and the power that comes with them, especially when it involves the nation's purse strings. From all that we've seen thus far, Mr. Rangel has violated that trust continually and seemingly without care.
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Already under fire for a wide range of ethical questions, Rangel played the race card in a health care forum the other night, saying racial bias against President Obama is behind opposition to health care reform.
"Some Americans have not gotten over the fact that Obama is President of the United States. They go to sleep wondering, 'how did this happen?'"
Rangel also likened the fight to provide health care for the uninsured to the fight for civil rights.
"Why do black people have to bargain for what is theirs? Why do we have to wait for the right to vote? Why can't we get what God has given us? And that is the right to live as human beings and not negotiate with white southerners and not court the votes. Just do the right thing," Rangel said.
Rangel's incendiary remarks come as the congressman filed amended financial reports to the House Ethics Committee admitting that he forgot to report millions of dollars in assets and income.
Financial forgetfulness is apparently a disease that is spreading to his staff. Two top aides -- chief of staff Jim Capel and Rangel legal counsel George Dalley -- are among about a dozen staffers on Rangel's tax-writing House Ways and Means Committee that have filed amended financial reports recently. Capel did not file any financial disclosure statements for six years.
Rangel's own forgetfulness prompted the political important Washington Post to demand Thursday that Rangel step down as chair of Ways and Means.
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