Federal workers with outstanding tax bills numbered 149,000, and their combined tax debt totaled $1.5 billion as of 2021, according to a new Treasury Inspector General for Tax Administration audit, as legislative remedies for the problem proposed by Republican lawmakers over more than decade have gone nowhere.
Finding that “the number of delinquent Federal civilian employees has increased by 32% from Fiscal Years (FY) 2015 to 2021” and their “related balances due” have increased by almost 36%, the IG report concluded that the IRS has failed to adequately prioritize delinquent federal works for compliance.
The report said federal employees must be held to a higher standard when it comes to tax compliance.
“Like all taxpayers, Federal employees and retirees have a legal obligation to file tax returns and pay their taxes,” the report reads. “However, Federal employees are held to a higher standard for a number of reasons, including that they draw their compensation and funds from Federal taxes. As the agency primarily responsible for administering Federal tax law, the IRS must ensure that Federal employees comply with the tax law in order to maintain the public’s confidence.”