Here's a group the IRS should go after...employees of the federal government who do not pay their federal income taxes. Senators Tom Coburn (R-OK) and Mark Pryor (D-AR) have introduced a bill that would allow agencies to fire any federal employee who are seriously delinquent in paying their taxes (defined as they have an outstanding tax debt for which a federal lien has been filed in the public records).
Based on the 2011 tax year federal employees owe a $3.5 billion dollars in back taxes. And while the IRS has a rule which punishes delinquent taxpayers in its employment, other agencies do not:
According to the most recent IRS data, as of 2011, more than 311,000 current and former federal employees owed more than $3.5 billion in unpaid federal taxes, an 11.5 percent increase in the delinquency rate of federal employees from 2010, in which the rate also increased from 2009.
Of the nearly 312,000 employees with tax debts, 107,658 were current civilian federal employees owing $1.013 billion in unpaid taxes, while 141,980 were military and civilian retirees owing $2.1 billion.The money lost is substantial but just as important is that the people who's jobs depend on tax dollars should be first in line to pay their "fair share" of federal taxes (as the vast majority of federal agencies do).
The IRS data indicated that 2,552 employees in the Department of Justice owed more than $20 million in back taxes. The Department of Health and Human Services had a delinquency rate of 4.03 percent, as 3,454 employees owed the government $44.6 million. In addition, 22,404 employees of the U.S. Postal Service owed more than $215 million in delinquent taxes, while 2,453 employees of the Social Security Administration owed more than $22 million in back taxes. The Smithsonian Institution’s delinquency rate was more than 6.6 percent, as 328 Smithsonian employees owed more than $3 million in taxes.
In Congress and the executive branch too, there were employees with substantial tax debts. As of 2011, 688 employees of the House and Senate owed more than $10 million in taxes. Similarly, 40 employees in the Executive Office of the White House owed $333,485 in unpaid federal taxes.
“This bill helps fill a gap created by the IRS by prohibiting the federal government from employing tax cheats. It’s wrong to force American families to fund the paychecks of federal employees who don’t feel like paying their taxes. While most federal employees are hard-working and responsible citizens who pay their taxes, others are not.”This legislation would only apply those workers who have consciously neglected to pay their incomes taxes and would exclude employees from suspension if there is a good faith effort on their part to pay up.
He and Pryor noted that the bill would help federal agencies avoid issuing indiscriminate furloughs by favoring employees who pay their taxes.
“In today’s tight budget environment, we need to ensure that we’re getting the most bang for our buck,” said Pryor. “Taxpayers shouldn’t be asked to foot the bill for federal employees who are delinquent. These employees—like the rest of America—need to pay their taxes or face the consequences. Our common-sense bill helps us meet this goal.”
The bill would exclude federal employees from suspension if the individual is currently paying their taxes, interest and penalties owed to the IRS under an installment plan; the individual and the IRS have worked out a compromise on the amount of taxes, interest and penalties owed and the compromise amount agreed upon is being repaid to IRS; the individual has not exhausted his or her right to due process under the law (a broad exception that references administrative or judicial remedies); or the individual has filed a joint return and successfully contends that he or she should not be fully liable for the taxes, interest, and/or penalties owed because of something that the other party to the return did or did not do.
Senator Coburn has also proposed additional legislation that would bar tax scofflaws from receiving government assistance including federal grants, contracts, loans and agriculture-related tax credits. That measure was submitted as an amendment to the Senate’s farm bill which should be voted on during the next few weeks.