FEDweek

IG Finds Issues with Collection of IRS Employee Debt, Treatment of Taxpayers

Separate IG reports focusing on the IRS workforce—which for years has been under especially tight scrutiny from Capitol Hill among all federal agencies—have identified issues with collection of non-tax debt and behavior toward taxpayers.

While most prior attention to debt by IRS employees has focused on their compliance with federal tax laws, the latest report focused on debt owed to the government for other reasons, such as salary overpayments and unpaid health insurance premiums. The IG report said that about 7,700 agency employees—out of a total workforce above 80,000—currently have such debt, totaling some $7.5 million.

It said that while the agency has taken steps to improve identification and collection of such debts, “it is difficult for the IRS to easily determine the impact of these improvements because the IRS does not receive reliable reports to determine how nontax debts were resolved” through actions such as salary garnishment. The IRS also could not provide evidence that it approved the cancellation of employee nontax debts as required and its processes did not ensure that collection actions were taken timely, it said.

A separate report meanwhile found four instances in fiscal 2016 of employees violating taxpayer protections that resulted in disciplinary actions against the employees. “These violations included contacting taxpayers directly without the required consent of the taxpayers’ power of attorney, harassing or abusing taxpayers, and using obscene or profane language with taxpayers during collectionrelated activities,” it said.

It further identified four additional misconduct cases that were not closed timely on the IRS’s tracking system. While such cases were relatively few in relation to the total, it added, “the abuse and harassment of taxpayers by IRS employees while attempting to collect taxes reflects poorly on the IRS and can have a negative impact on voluntary compliance.”