IRS contractors owe back taxes
Agency pays companies that owe the government millions. Bill seeks to fire federal employees who haven't paid taxes.
Everybody is looking for more tax money to cover ginormous budget gaps. At the federal level, it looks like the search for additional revenue should start at home.
The Treasury Inspector General for Tax Administration, or TIGTA, says existing practices within the IRS let tax agency contractors get paid even though they owed back taxes.
Eleven IRS contractors received more than $356 million in payments from Uncle Sam in 2009 despite owing a combined $3.8 million in back taxes, according to the new TIGTA report bluntly titled Existing Practices Allowed IRS Contractors to Receive Payments While Owing Delinquent Taxes.
TIGTA also identified five contractors with delinquent taxes totaling approximately $4.2 million that were not included in the IRS' automated Federal Payment Levy Program, or FPLP.
Article continues below
All five contractors questioned the tax assessments and provided the IRS information to substantiate their arguments disputing the tax bills. The IRS told TIGTA that it has a responsibility to investigate the merit of a taxpayer's claim before initiating enforced collection activity.
That's a valid IRS position. Every taxpayer should be afforded the opportunity to argue his or her case.
TIGTA doesn't have a problem with the process. But it does think the IRS needs to speed things up.
The oversight group's investigation found that it took the IRS an average of eight months to review and determine if information contesting charges of unpaid taxes was sufficient to change the IRS' mind.
And while reviews are conducted, the IRS suspends collection efforts. Payments, however, continue to go out.
In this case, the contractors with questionable tax compliance skills received payments totaling approximately $356 million from the IRS and another $3.6 billion from other Federal agencies.
Not so good.
"All federal contractors, and particularly those that do business with the IRS, must meet their obligations to pay federal taxes," said J. Russell George, Treasury Inspector General for Tax Administration in a statement accompanying the report.
"Although the IRS has the responsibility to investigate the merit of a taxpayer’s claim before initiating enforced collection activity," George said, "it should improve its practices to expedite the timely resolution of federal contractor accounts that are in dispute."
TIGTA recommended that the IRS review its current processes to find ways to speed up cases where the agency believes federal contractors are behind in their taxes. Ya think?
The IRS agreed with TIGTA's recommendations. No kidding!
Federal workers also owe Uncle Sam
On the individual side of unpaid taxes, federal employees regularly appear high on the tax debtors list.
That's no surprise. People from all professions sometimes get behind on their tax bill payments.
But some members of Congress say federal employees and contractors should be more responsible.
Rep. Jason Chaffetz, R-Utah, has introduced H.R. 828, which would terminate the employment of current federal employees and prohibit the hiring of future federal employees who have a seriously delinquent tax debt.
The bill defines "seriously delinquent" as "an outstanding debt under the Internal Revenue Code of 1986 for which a notice of lien has been filed in public records." If an employee is paying his or her tax bill under an agreement with the IRS or the tax debt is under review, the federal staffer wouldn't be fired or the prospective employee could be hired.
Currently, only IRS employees can be terminated for non-payment of federal income taxes.
Chaffetz, who serves on the House Oversight Committee overseeing Federal Workforce, Postal Service and the District of Columbia, also introduced H.R. 829, The Contracting and Tax Accountability Act of 2011, which would prohibit any person who has a seriously delinquent tax debt from obtaining a federal government contract or grant.
And in a rare case where a Republican positively cites the president, Chaffetz noted that in the 110th Congress then-Senator Barack Obama sponsored a similar bill in an attempt to weed out federal contractors with unpaid tax bills.
"Congress must send the message that those who deliberately and willfully dodge federal tax obligations should not expect to collect a taxpayer-funded paycheck," said Chaffetz in a statement announcing the bills. "At a time when this country is nearly $14 trillion in debt and many Americans are struggling to find work, the federal government need not tolerate tax evasion within the federal workforce."
This is Chaffetz's third attempt to fire federal employees or prevent the hiring of new federal workers who haven't paid their taxes.
VIDEO ON MSN MONEY
Right now, we're missing out on up to 100 billion per year in corporate tax revenue because of offshore tax haven abuse- that's $1 trillion each decade. We need laws passed making it illegal for these big corporations to hide their money from the government and start paying up! Check out Stop Tax Haven Abuse Act. It is time for action and stop the trash talk of "spreading the pain around" and "share sacrifice,"
Eleven IRS contractors received more than $356 million in payments from Uncle Sam in 2009 despite owing a combined $3.8 million in back taxesFirst thing I want to know is, why in the world these people received more than $32.34 MILLION each in 2009? What the hell do they do that they should be paid that kind of money? Seems to me the government could cut some of that bs spending instead of Medicare and Social Security and save a lot more money. And second thing I want to know is, why they only owe a combined $3.8 million? If regular people made that kind of money we would owe more than $124 million combined. And the third thing I want to know is, like all of you, if the gov workers don't have to pay taxes then why do we have to pay taxes?
This is why I would not trust the Public Sector to manage my Fish Bowl.
"Eleven IRS contractors received more than $356 million in payments from Uncle Sam in 2009 despite owing a combined $3.8 million in back taxes".
The only motivation that I can think the IRS used in this case is that they thought they could panelize and attach interest to the owed monies. Obviously big business is getting Accident forgiveness these days so that philosophy does not fly with me.
I think they just don't know what the hell they are doing.
If an IRS employee cheats or even makes and honest mistake, he can and will be fired. The Republican idea of outsourcing jobs to save money has proven to be a fallacy. If there is no oversight of contractors, the contractors can rob the government blind and with impunity.
Blackwater, in Iraq, is the best example of grand theft by contractors with nothing done about it.
Want to save money, hire American taxpayers who pay their taxes and not corporations that do not.
This news is incomplete, like all news you show,. We have the right to know WHO ARE THIS .
WHY THEY OWE THAT MONEY? IF ONE OF US OWE SOME MONEY TO IRS, WE HAVE TO PAY WITH INTEREST.
Will this policy also include Senators, and Representatives?
What's good for the goose...
Copyright © 2014 Microsoft. All rights reserved.