Senators concerned about federal tax form processing

The Senate’s top two tax writers pressed four federal payroll centers on Monday over concerns that tax forms aren’t being processed quickly enough, which could make life easier for identity thieves. 

Senate Finance Committee Chairman Orrin Hatch (R-Utah) and the panel’s top Democrat, Sen. Ron Wyden (Ore.), said they had heard concerns from state agencies that the four shared-service centers weren’t giving them wage and withholding information quickly enough. The shared-service centers also give that information to the Social Security Administration.

{mosads}Identity thieves have increasingly started filing fraudulent tax returns using someone else’s Social Security number in recent years. Hatch and Wyden wrote on Monday that delays in getting the wage and withholding information to the states can put federal employees at risk to return fraud.

“State tax administrators have reported to us and our staffs that a number of federal agencies routinely fail to file this employee-specific information at all, much less in a timely manner,” Hatch and Wyden wrote. 

“At a time when identity-theft related tax refund fraud has reached epidemic levels, the federal government should be doing all it can to ensure the integrity of the tax administration process, both at the state and federal levels.”

Hatch and Wyden sent the letter to the Agriculture Department’s National Finance Center, the Pentagon’s Defense Finance and Accounting Service, the Interior Department’s National Business Center and the General Service Administration’s National Payroll Branch.

The two senators asked the four branches, among other things, when they sent W-2 forms for a variety of agencies to the SSA and state authorities between 2012 and 2014.