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Monday, September 13, 2010

Over 280,000 Federal Workers Owe $3.3 Billion in Back Taxes

Over 280,000 federal workers and retirees owed more than $3.3 billion in back income taxes in 2009 (up from $3.0 billion in 2008 and $2.7 billion in 2007).

The cabinet departments with the largest percentages of employee/retiree tax deadbeats are:

  1. Housing & Urban Development:  4.40%
  2. Veterans Affairs:  4.04%
  3. Education:  3.86%
  4. Army:  3.69%
  5. Health & Human Services:  3.58%  
  6. Defense:  3.20%
  7. Commerce:  3.15%
  8. Air Force:  3.14%
  9. State:  3.10%
  10. Navy:  2.95%

The agencies and commissions with the largest percentages of employee/retiree tax deadbeats are:

  1. Committee for Purchase from People Who Are Blind or Severely Disabled:  14.29%
  2. Federal Mine Safety & Health Review Commission:  11.11%
  3. U.S. Access Board:  7.32%
  4. Government Printing Office:  6.83%
  5. National Capital Planning Commission: 6.67%
  6. Small Business Administration:  6.34% 
  7. Federal Labor Relations Authority:  5.79%
  8. U.S. Commission on Civil Rights:  5.77%
  9. Armed Forces Retirement Home:  5.28%
  10. U.S. Office of Special Counsel:  5.26%

Other departments and agencies:

  • Federal Reserve Board:  4.32%
  • U.S. House of Representatives:  3.93%
  • U.S. Senate:  3.04%
  • SEC:  2.44%
  • U.S. Tax Court:  1.75%
  • Treasury Department:  0.99% (the lowest delinquency rate among cabinet departments)

Press and blogosphere coverage:

http://taxprof.typepad.com/taxprof_blog/2010/09/over-280000.html

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Comments

This would be more useful if the overall tax deadbeat percentage was included. Any idea what it is?

Posted by: Zero | Sep 13, 2010 11:10:48 AM

How does this compare to other groups? Or the population as a whole?

Posted by: Richard Marpet | Sep 13, 2010 11:23:02 AM

How do these figures compare with American taxpayers at large? Are federal employees more or less likely to be tax deadbeats?

Posted by: Jacknut | Sep 13, 2010 11:33:28 AM

Paying your taxes in full by the due date must be a condition of federal employment.

No more "rules for thee, but not for me". It appears the government is fiddled with elitists from top to bottom with those at the top handing out tax passes left and left. This is very, very corrosive to the rule of law and the social contract by which people respect government.

Posted by: theBuckWheat | Sep 13, 2010 11:48:35 AM

Federal Workers are constantly referred to as "Cream of the Crop", "Higher Quality", "Better Educated" to justify their higher pay relative to the private sector. If this is the case they should be held to a higher standard when it comes time to pay their taxes on time and in the appropriate amount. After all, they are "Better Educated" and such.

Posted by: John | Sep 13, 2010 12:07:52 PM

The questions asking how federal workers compare to the general population are just so much deflection. We should not have average people working for the government, we should have above-average people working for the government. As another poster mentioned, we should have a zero-tolerance rule for federal workers who deliberately evade taxes.

Posted by: ObiJohn | Sep 13, 2010 1:52:39 PM

I cannot think of a better way to pare government employee payrolls than by firing, based upon probable cause, all who fail to pay income taxes in full and promptly when due.

Posted by: Paddy | Sep 13, 2010 3:05:32 PM

The first three commenters jumped in with what seems to be a "defense" of the govenment deadbeats by implying that they may be no different from private taxpayers. -- "How do these figures compare with American taxpayers at large?"

What difference does such a comparison make? The percentage that is important and which should be used for comparison is ZERO percent.

When people are paid by the taxpayers, they should be expected to pay their own full share of taxes on time. If government workers don't promptly remedy tax debts, then the back taxes should be automatically deducted from their paychecks.

One of the aspects of government employment, as opposed to private employment, is that government employees are provided with wages, benefits, and, especially, job security that exceed what is found in comparable private employment. With these advantages over other workers, about whom previous commenters wanted comparisons, it's not too much to expect government workers to live up to laws that they help to put in place and to enforce against others. Otherwise, let them join the seventeen percent of American workers who are unemployed or have given up finding any work.

Any delinquent taxes from those who live off of taxes is an outrage.

Posted by: Woody | Sep 13, 2010 3:17:11 PM

I would also be very curious about the number of audits in the government employed sector vs. civilian population.

I'm with Jacknut: Pay up or pack your office!

Posted by: KJohn | Sep 13, 2010 4:02:18 PM

Incidents like this simply play into the hands of people like myself. People who no longer care about the rule of law and simply consider...who....whom because they believe that the elite in this country is their enemy. If I thought that the FedGov would actually fix this problem and clean house, I wouldn't say anything about it, because I want them to reap the consequences of their long-standing abuse of the population. Because I know that they won't, I can't resist gloating. Sorry :-)

Posted by: Jehu | Sep 13, 2010 8:14:45 PM

Patrick Cox at Taxmasters is in line for a big windfall. 280,000 people who need him to get the IRS off their backs, because "the IRS will relentlessly pursue you for unpaid taxes."

Posted by: kimsch | Sep 13, 2010 9:55:38 PM

A quick link of the file our good TaxProf links to notes that the population under survey totals 9,783,017, of which 282,554 (2.26%) are delinquent. The footnote also adds "2For the purpose of this table, an employee is considered delinquent if he has an unresolved federal income tax delinquency in the form of a balance owed and/or an unfiled tax return. Accounts in currently not collectible, combat zone, offer in compromise, or bankruptcy/litigation status are included. Employees in installment agreements are excluded."

Additionally, the population includes Federal Civilian Workers and Retirees and Military Active Duty, Reserve/Guard and Retired.

You have to love the absolutist positions people take here. There's a reason why we have due process under the law. Which even applies to federal workers. Every case should be judged on its own merits. Especially those combat zone deadbeats. How dare they!

And just so everyone knows: For Treasury Department personnel, even a minor error on your tax return can cost you your job. And if you actually pay taxes, you know how easy it is to commit a minor error. Anyone who thinks that every tax return should be perfect should become an IRS auditor.

Posted by: Jacknut | Sep 13, 2010 9:56:20 PM

Incidentally, the mean amount owed is around $11,000 (sorry, did the math in my head, so no exact sum). Of course, this doesn't really tell us anything. We'd need to look at the dataset to see if there are a few outliers that distort the total.

Posted by: Jacknut | Sep 13, 2010 10:12:34 PM

Wait just one minute! This says that 280,000 employees and retirees of the government each owe close to $12,000 EACH in back taxes? I thought government employees would be the first to listen to Bite Me Biden and do their patriotic duty. I guess not so much.

Posted by: Nick Shaw | Sep 13, 2010 10:58:21 PM

I don't understand some of the calls here for a "higher standard" for federal workers. We all should be held to the same standard. After all, it's not as if the average federal worker is creating the beast of a tax code that America suffers under. Now a higher standard for Congress, that might be worth a look...

Posted by: Conor | Sep 14, 2010 7:09:33 AM

JN: "You have to love the absolutist positions people take here. There's a reason why we have due process under the law. Which even applies to federal workers. Every case should be judged on its own merits. Especially those combat zone deadbeats. How dare they!"

Due process?!! With the IRS?!! Do you know how many destructive levies that I've had to have reversed because the government didn't know what it was doing or didn't do its job properly? I guess those are "minor errors." Anyone who doesn't understand should have to deal with "an IRS auditor" or collection officer. (Don't get me started on state dept of revenue collectors.)

Yes, I say that federal employees should be held to 100% compliance. Noncompliance in the typical work force isn't typically caused by "mistakes," but likely result from negligence, which is what happens when one does not pay, or oversight, which can be readily corrected and would be less of a factor in the study.

And, if an employee owed money to a private company, do you know how long it would take the company to get repaid?

The "combat zone deadbeats" is a red herring. I'll give a break to someone fighting Islamic terrorists or has had his legs blown off by a terrorist land mine, but those with cushy desk jobs in the Pentagon don't get the same break.

Posted by: Woody | Sep 14, 2010 12:30:24 PM

In all of the above comments I did not note one that pointed out that the three major armed services are all on the list. We pay these folks a modest salary and then put them in harm's way with resulting injuries both physical and mental. Have a little compassion all of you who want to fire all these good people. All you have to do is meet with a few people who you knew before they went to Iraq and assess how well they handle daily tasks like returning your phone calls and you are then likley to be a bit less of an authoritarian disciplinarian.

Posted by: Bill | Sep 14, 2010 1:31:54 PM

Time to think outside the box.

A nation cannot control its destiny if it cannot control its money.

Money must be created from thin air, for it does not grow on trees. Charging interest on "nothing" is stealing. The system is corrupt at its core.

Outlaw interest and only outlaws will charge interest. Interest is usury and usury is cheating. No one likes a cheater. Outlaw cheating.

Without usury, there would be no inflation as long as loans are repaid over the lifetime of the collateral. A new house should last 100 years. A $100K home loan would be $83.33 in monthly payments.

Print the money to build a bridge and the bridge itself is collateral.

We live on table scraps compared to the wealth created by our work. Time to push the fat hogs away from the trough.

Posted by: Steven G. Berry | Sep 14, 2010 9:00:23 PM