Thursday, September 25, 2008

Federal Workers Owe Billions in Back Taxes

If you owe back taxes you are not alone. Federal employees from the U.S. Postal Service to the Executive Office of the President have not paid their 2007 federal income taxes.

The Internal Revenue Service is trying to collect billions of dollars in unpaid taxes from nearly half a million federal employees. According to IRS records, 171,549 current federal workers did not voluntarily pay their federal income taxes in 2007. The same is true for 37,752 active duty military and nearly 200,000 retired civilian and military personnel.

Almost 450,000 federal employees and retirees did not pay their taxes for a total of $3,586,784,725 in taxes owed last year.

Each year the IRS tracks the voluntary compliance rate of all federal workers and retirees. The percentage of employees and retirees who are delinquent has gone up and down over the past five years, but the amount unpaid has increased each year topping $3.5 billion for the first time in 2007.

The agency with the most delinquent employees is the U.S. Postal Service. With more than 747,000 employees, the postal service is the largest employer in the federal government, but with a 4.16 percent delinquency rate, it is a full 1 percent above the average compliance rate this year.

The IRS would not provide comparable data for the general population. But a spokesperson for the IRS did supply the delinquency rate for IRS employees -- less than 1 percent. The IRS is the only federal agency where an employee can be fired for not paying his taxes.

The Executive Office of the President, which includes the White House, has 58 employees who did not pay $319,978.

The Federal Housing Finance Board comes in as the agency with the best compliance rate of all agencies with 100 or more employees. The FHFB had four of its 134 employees on the list of delinquents, three of them have now entered into voluntary payment plans with the IRS.
In fact, 152,554 of the delinquent feds have entered into payment plans. Nevertheless, $2.7 billion remains uncollected.

Other notable agencies with high delinquency rates include the Smithsonian Institution, where nearly 5.5 percent of the employees didn't pay their taxes. On Capitol Hill, more than 1,000 workers are on the list. The Government Printing Office has the highest percentage of delinquent employees with 7.23 percent.

If you owe back taxes you are not alone. Don't feel overwhelmed, like there is no where to turn. Call someone who can help with your situation.

1 comment:

Brian Watkins said...

Another great post! That is amazing how many government employees do not pay or file taxes, even in the White House. What would be interesting to note is if/how collection differs in these instances.