GovernmentExecutive.com

Return to Article: GAO: Contractors owe $3 billion in taxes

• 10508
  

  Why is Bush in favor of contracting out rather than using the federal civilian workforce? SIMPLE! There is no way he or his buddies can make any money/profits out of the federal civilian workforce. It's that simple.

  GovExec.com reader Posted June 22, 2005 7:26 AM
• 10506
  

  This is simple to solve. Procurement officials should include a clause in each contract that says the contract payments will be assigned to the IRS if the contractor has a tax delinquency.

  taxpayer Posted June 22, 2005 7:18 AM
• 10475
  

  A possible solution to the problem of income taxes not being paid by Federal Contractors. It seems the law is not being applied equally. As an example, take a potential applicant for a Federal Job. Before the offer is finalized, one is required to complete SF-306 Declaration For Federal Employment, which among other questions, asks the applicant whether he is in debt to the Federal Government. This includes delinquent Education Department Loans, HUD Loans, SBA Loans, and of course taxes owed IRS. While as a result of the debt the individual may still be appointed, arrangements no doubt are made to offset the debts from their salary until they are paid back in full, if arrangements were not made prior to their beginning Federal Service.

  To ensure money due the government is recouped, a new form should be made a part of the bid package, an IRS Form which will state whether or not the potential contractor owes delinquent taxes to IRS, and if so how much. Form might work as follows: Prior to bidding, potential bidder would submit this form with their corporate name and appropriate tax identification number to the IRS, at a designated IRS Location. So this program will not add costs to IRS, a small fee of $5 or $10 would be payable upon submission, which would offset IRS costs for administering and processing the form. So as to not overburden a bidder with excessive fees, this form would be valid for 90 days in submitting bids and proposals to Federal Agencies. In the event a company in debt were awarded a contract, part of the contract would spell out how repayment would be made, be it by offset against contract payments, or some other mutually agreed upon plan.

  Undoubtedly, there are many governmental bodies, both large and small in the U.S. which have policies on giving business to entities owing them money for delinquent items. For example, in Chicago, where I work if one wishes to bid for city business they are required to receive signed statements from the Revenue Department stating they owe the city no delinquent fines, fees or taxes. Program seems to work for them, why not the Federal Government? Is anyone listening?

  GovExec.com reader Posted June 21, 2005 10:23 AM
• 10468
  

  Does anyone really think George Bush will put the DOJ on any of these contractors? He is on their side and not yours. You pay your taxes and shut up. He will make sure his friends get their money and pay no taxes.

  Butt out of George's business, he knows what he is doing. It is none of your business, get it?

  If you don't vote these NeoCons out you are going to get more bad stuff and more dead kids.

  GovExec.com reader Posted June 21, 2005 7:36 AM
• 10442
  

  Charlie,

  You missed the point! The IRS did not even know they were not being paid! How is that for government competence?

  taxpayer Posted June 20, 2005 6:41 AM
• 10438
  

  Of course GSA couldn't immediately say whether they would disbar any contractors charged with violating tax laws because after all, there are 33,000 contractors involved (a conservative number I believe), and that could very well wipe out nearly all GSA Scheduled contractors for the next three years!! ...and away goes trouble - I mean GSA - down the drain!

  A-76'd Career Federal Employee Posted June 19, 2005 9:13 PM
• 10426
  

  Wow, that's a total of $6 billion in unpaid taxes that we know of now (Pentagon + non-defense contractors). Based on the figures it seems 1 out of every 5 contractors cheats the government. Yet, the lobbyist brushes this off saying it's a small concern.

  Let's put this in perspective. The Bush Administration is pushing A-76 outsourcing based on a claimed savings of 1.25 billion. Yet, if we factor in contractor tax cheating we find the government actually lost five times that amount. It would be interesting to know if any of these 60,000 tax cheating companies ever won an A-76 bid.

  Overseas it gets even worse because contractors fall into a gray area of the law. Thousands of overseas defense contractors don't have to pay a nickel in tax (to the US or host country). Money laundering is common. The tax loophole allows them to lower their total operating cost and bid low on stateside contracts as well. And this amount isn't even included in any of these studies on contractor tax fraud.

  GovExec.com reader Posted June 17, 2005 11:06 AM
• 10421
  

  The government outsourced and hired contractors to save money, but the government created a task force last year to monitor and collect taxes from Pentagon contractors. Please explain how is this contracting game saved money for the American taxpayer?

  Patricia Posted June 17, 2005 9:22 AM
• 10408
  

  I agree with Ms. Kelley. If this was Joe Citizen on the street, the IRS would have either been in the process of locking him up or ready to prosecute. Why should the American people put up with this kind of crap and yet the Government continues to let these crooks operate and rape the American people financially? Send them to jail.

  Charlie Posted June 16, 2005 8:00 PM