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Federal workers owe $3.5 billion in back taxes; Expect renewal of legislative efforts to fire federally-employed tax debtors

March 10, 2013

Taxes, or more precisely the paying of them, are problematic for lots of folks, including those whose paychecks come from a federal agency.

The Internal Revenue Service last week released data, reported by the AP (it's not yet available on the tax agency's website), showing that nearly 312,000 federal workers and retirees owed more than $3.5 billion in back taxes as of Sept. 30, 2011.

That amount due earns this week's By the Numbers honor.

3 point 5 billion in federal employee back taxes

That amount is a nearly 12 percent increase over the year before.

Overall, the 9.8 million federal workers included in the analysis had a delinquency
rate of 3.2 percent.

But that's actually not too bad in the grand tax scheme, er, perspective.

The delinquency rate for the general public during that fiscal year was, according to the IRS, 8.2 percent, five percentage points worse than federal
workers.

Legislation already in the hopper: That any of Uncle Sam's employees (or those receiving retirement benefits from him) aren't paying their proper taxes is a concern and sure to set off a firestorm of criticism.


US Rep Jason ChaffetzIt also might get Rep. Jason Chaffetz (R-Utah; pictured at right) some cosponsors on his bill, H.R. 249, that would fire federal workers who owe back taxes. Under current law, IRS employees are the only federal workers who can be fired for not paying their taxes.

Expanding that personnel option has been one of Chaffetz's legislative quests. In prior legislative sessions he filed bills that targeted federal workers who are "the most
serious offenders. They've gotten to the point where the IRS is having
to put a lien on their property."

Chaffetz also previously sought to prevent federal agencies from hiring individuals who
haven't paid their taxes.

Those same provisions are in Chaffetz's latest measure, the Federal Employee Tax Accountability Act of 2013. He introduced it in mid-January, soon after the 113th Congress convened.

Chaffetz also reintroduced the Members of Congress Tax Accountability Act. This bill, H.R. 884 in the new Congress, would require Representatives and Senators to disclose their delinquent tax liability, would require an ethics inquiry into that delinquency and would garnish the wages of a Member who had a delinquent federal tax liability.

I expect the Congressman's website also will very soon have a statement about this latest report on overdue taxes from federal workers.

You also might find these items of interest:

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TAX-SAVVY WAYS 
TO WRAP UP 2026

It’s over! With October’s extended filing deadline behind us, it is now time to focus on year-end moves to reduce your 2026 tax bill. 

You’ll find ways to do just that on the Tax Tips page (see the More Tax Posts drop-down menu at the top of the blog), as well as the separate tax tip pages for each month, notably October through December. If you’re on the Tax Tips page, you’ll find a monthly list at the end of this column. If you’re on another blog page, you can head straight to the October tips; at the bottom of that tips page you’ll find links to all the other 11 months’ collections of tax advice.

Not to spoil what you’ll find in that tax advice, but it does cover such things as tax deductions for charitable donations, investment moves that could reduce tax due, and ways to max out your tax-favored retirement savings. 

Finally, as the year winds down, things get hectic. There are lots of other things to occupy our time, like the much more fun upcoming holidays. But don’t lose sight of taxes, since timing is key. To be of use, most tax moves must be made by the end of the tax year. That’s Thursday, Dec. 31, which also is the last business day of the year. 

So that you don’t miss that final tax year deadline, also keep an eye on the countdown clock below. It will keep you on top of just how much time is left to make important, tax-saving moves. (Note: I’m in the Central Time Zone, so adjust accordingly for where you live.)

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