IRS Senior Execs Took Improper Tax Deductions

Damian Dovarganes/AP

Career senior executives at the Internal Revenue Service improperly claimed non-taxable revenue on travel expenses, despite receiving adequate instructions from the agency, according to a newly-released audit.

The Treasury Inspector General for Tax Administration said in a report published Tuesday that some IRS executives were not properly classifying their travel as “long-term taxable travel,” or LTTT. When employees travel to a single location for more than one year, or perform their principal duties away from their “official station” for an indefinite amount of time, they are required to pay taxes on any travel-related reimbursements they receive.

To conduct the review, the IG’s office took a sample of 31 IRS senior executives who could have qualified for LTTT in fiscal years 2011 and 2012. The auditors found nine managers -- or about 30 percent -- incorrectly reported their expenses as nontaxable, while three employees did not submit their records in a timely fashion. The average travel reimbursement for these employees was $51,420.

Despite providing guidance to its employees, the IRS must do a better job following up on documentation to ensure compliance, the IG’s office said.

“The IRS has established adequate guidance defining when travel is taxable and employees’ and managers’ responsibility to make that determination,” the auditors wrote. “However, the guidance was not consistently followed.”

The IG recommended the IRS chief financial officer inform or remind employees of the policies related to LTTT. IRS officials agreed with the report’s findings and will implement the recommended changes. 

Stay up-to-date with federal news alerts and analysis — Sign up for GovExec's email newsletters.
FROM OUR SPONSORS
JOIN THE DISCUSSION
Close [ x ] More from GovExec
 
 

Thank you for subscribing to newsletters from GovExec.com.
We think these reports might interest you:

  • Sponsored by G Suite

    Cross-Agency Teamwork, Anytime and Anywhere

    Dan McCrae, director of IT service delivery division, National Oceanic and Atmospheric Administration (NOAA)

    Download
  • Data-Centric Security vs. Database-Level Security

    Database-level encryption had its origins in the 1990s and early 2000s in response to very basic risks which largely revolved around the theft of servers, backup tapes and other physical-layer assets. As noted in Verizon’s 2014, Data Breach Investigations Report (DBIR)1, threats today are far more advanced and dangerous.

    Download
  • Federal IT Applications: Assessing Government's Core Drivers

    In order to better understand the current state of external and internal-facing agency workplace applications, Government Business Council (GBC) and Riverbed undertook an in-depth research study of federal employees. Overall, survey findings indicate that federal IT applications still face a gamut of challenges with regard to quality, reliability, and performance management.

    Download
  • PIV- I And Multifactor Authentication: The Best Defense for Federal Government Contractors

    This white paper explores NIST SP 800-171 and why compliance is critical to federal government contractors, especially those that work with the Department of Defense, as well as how leveraging PIV-I credentialing with multifactor authentication can be used as a defense against cyberattacks

    Download
  • Toward A More Innovative Government

    This research study aims to understand how state and local leaders regard their agency’s innovation efforts and what they are doing to overcome the challenges they face in successfully implementing these efforts.

    Download
  • From Volume to Value: UK’s NHS Digital Provides U.S. Healthcare Agencies A Roadmap For Value-Based Payment Models

    The U.S. healthcare industry is rapidly moving away from traditional fee-for-service models and towards value-based purchasing that reimburses physicians for quality of care in place of frequency of care.

    Download
  • GBC Flash Poll: Is Your Agency Safe?

    Federal leaders weigh in on the state of information security

    Download

When you download a report, your information may be shared with the underwriters of that document.