$9.3 million in overdue taxes owed
Friday, September 10, 2010
Capitol Hill employees owed $9.3 million in overdue taxes at the end of last year, a sliver of the $1 billion owed by federal workers nationwide but one with potential political ramifications for members of Congress.
The debt among Hill employees has risen at a faster rate than the overall tax debt on the government's books, according to Internal Revenue Service data. It comes at a time when some Republican members are pushing for the firings of government workers who owe the IRS and President Obama has urged a crackdown on delinquent government contractors.
The IRS information does not identify delinquent taxpayers by name, party affiliation or job title and does not indicate whether members of Congress are among the scofflaws. It shows that 638 employees, or about 4 percent, of the 18,000 Hill workers owe money, a slightly higher percentage than the 3 percent delinquency rate among all returns filed nationwide.
The average unpaid tax bill is $12,787 among the Senate's delinquent taxpayers and $15,498 among those working in the House.
"It's kind of embarrassing if you help make the laws but you don't obey the laws," said Sen. Charles E. Grassley (Iowa), the ranking Republican on the Senate Finance Committee, which has jurisdiction over tax matters.
IRS debt among government workers has surfaced repeatedly as a political issue over the years, most recently when Rep. Jason Chaffetz (R-Utah) introduced legislation this year to fire federal workers who owe back taxes unless they have entered into a payment plan. Eight Republicans co-sponsored the bill. No Democrats have signed on, and some have said firings would reduce the government's prospects of being paid.
"If you're on the federal payroll and you're not paying your taxes, you should be fired," Chaffetz said in an interview. He said the policy should apply across the board and "there should be no special exemptions."
An agency-by-agency breakdown of IRS debt is not published but is available in a redacted form from the agency upon request. Along with the Capitol Hill totals, it shows that three employees at the Office of Government Ethics owed a combined $75,000. And 41 employees at the Executive Office of the President owed $831,000 altogether - about the same amount as during the last year of George W. Bush's administration.
Some tax experts and watchdog groups say that Capitol Hill employees have an added obligation to settle IRS debts.
"Congress and their staff - because they are the people who write the tax laws and because they work for the public - have to be held to a higher standard," Steve Ellis, vice president of the watchdog group Taxpayers for Common Sense, said when told of the IRS numbers.
"These are hard times, but they are on the government payroll," said Mortimer Caplin, an IRS commissioner for Presidents John F. Kennedy and Lyndon Johnson and a founding partner of the Caplin & Drysdale law firm. "The idea of paying taxes is kind of fundamental to a sound democracy, and they certainly have a special obligation in that regard."
Nationwide, debt to the IRS has been rising steadily, even before the current economic downturn, with $103.2 billion owed at the end of last year. Tax experts say that delinquencies are another sign of economic pressures on American families, but they also may represent bad individual money management or skewed spending priorities.
On Capitol Hill, recent increases in delinquencies also may reflect the unusual nature of the workforce, which turns over dramatically when a new political party comes into power.
From 2004 through 2006, the last three years that Republicans were in power, the total amount of back taxes owed each year by congressional workers hovered just below $9 million. But in 2007, when Democrats took control of both houses, it dropped to $6.8 million. Since then, it has increased by 37 percent.
Jock Friedly, who publicizes congressional salaries on the Web site LegiStorm, said many new staffers come from the private sector, where they worked as lobbyists or in other higher-paying jobs. "They go to a somewhat lower-paying government job and then, over time, debt starts to build up," Friedly said.
During 2008 and 2009, - when the financial crisis took hold and the economy started sinking - the Senate debt increased 80 percent and the House debt increased 25 percent.
Aides to Senate Majority Leader Harry M. Reid (D-Nev.) declined to comment, and aides to House Speaker Nancy Pelosi (D-Calif.) did not respond to a request for comment.