Legislation Introduced to Block Bonuses for Tax Delinquent Federal Workers

By on October 30, 2015 1:33 PM in Pay & Benefits with 0 Comments
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Updated: August 25, 2016 7:22 PM

Senators Richard Burr (R-NC) and Joe Manchin (D-WV)

Senators Richard Burr (R-NC) and Joe Manchin (D-WV)

Senators Richard Burr (R-NC) and Senator Joe Manchin (D-WV) have introduced legislation that would withhold bonuses from federal employees who are delinquent on their taxes or have engaged in documented misconduct.

The bill is known as the No Bonuses for Tax Cheats Act (S. 2215). The language in the bill allows the Secretary of the Treasury to block bonuses for IRS employees for whom there is substantial evidence of misconduct or seriously delinquent tax debt. The bonuses in question include quality step increases and within grade pay increases based on performances.

Examples of misconduct in the bill’s language include possession or use of a controlled substance, misuse of travel charge cards, fraudulently claiming unemployment benefits or entering time/attendance on time sheets, or any other behavior as determined by the Treasury Secretary under regulations.

Seriously delinquent tax debt is defined in the bill as any outstanding debt under the Internal Revenue Code of 1986 for which a notice of lien has been filed in public records. It could also be debt that is not being paid in a timely manner or a debt for which a due process hearing has been requested or is pending.

If this legislation sounds familiar, it should. Burr and Manchin introduced a version of this bill in April 2014.

However, other such bills have been introduced in the past. Among them include the following:

  • In 2013, Senators Tom Coburn (R-OK) and Mark Pryor (D-AR) introduced a bill prohibiting the federal government from employing individuals with seriously delinquent tax debts.
  • Jason Chaffetz (R-UT) has introduced legislation in the past to fire tax delinquent federal workers. The latest version of that bill failed to pass the House in April.

Such bills have been spurred by reports such as one released earlier this year by the IRS which showed that federal employees collectively owe about $3.5 billion in unpaid taxes.

Speaking on the legislation, Burr said, “It’s unconscionable that federal employees are eligible for bonuses, paid for by Americans, while they have dodged the tax collectors. We know of too many examples of bad behavior from individuals like the IRS’s Lois Lerner, who targeted Americans for their political beliefs and received over $129,000 in bonuses even as she was engaged in wrongdoing. The IRS alone has paid over $2.8 million of taxpayer money to employees who haven’t paid their own taxes. This bill will put a stop to this egregious practice, once and for all.”

Manchin added, “The fact that millions of dollars in bonuses have been given to IRS employees who haven’t been paying their taxes is alarming and completely unacceptable. No federal agency is above the law nor should anyone be able to reward tax-delinquent employees with taxpayer-funded bonuses, least of all the IRS.”

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About the Author

Ian Smith is one of the co-founders of FedSmith.com. He enjoys writing about current topics that affect the federal workforce.