Presentation on theme: "Sunita B. Lough, Director"— Presentation transcript:
1 Sunita B. Lough, Director FEDERAL, STATE AND LOCAL GOVERNMENTSSunita B. Lough, Director
2 Government Entities Michael D. Julianelle Director, Government EntitiesThree Sub-functions:Federal, State and Local GovernmentsIndian Tribal GovernmentsTax Exempt Bonds
3 FSLG Organizational Design Compliance and Program Management StaffManager, with a staff of 12 AnalystsCPM staff is responsible for development, implementation, and monitoring of the annual Workplan through project development, workload selection, case processing, and data analysis. In addition, staff analysts are responsible for maintaining the FSLG Website at the semiannual FSLG Newsletter, as well as all outreach and education tools, including technical and procedural guidance for the Field Specialists.Field Operations8 Groups78 Field Specialists in 71 PODsThe Field Groups conduct exams, compliance checks of Federal agencies and state and local governments. In addition, they conduct outreach and educational activities with our taxpayers.
4 FEDERAL, STATE AND LOCAL GOVERNMENTS 1 PACIFIC COAST MIDWEST CENTRAL NORTHEAST2 WESTERN GULF COAST 6 SOUTHEAST 8 FEDERAL AGENCY****8 Federal Agency is Nationwide.
5 FSLG Historical Overview Governments historically underservedPreviously, issues handled by a small workforce in the former “Examination Division”Since 1987, IRS responsible for employment tax compliance activities for government entities
6 FSLG External Customers/Partners Federal government agenciesState government agenciesLocal government entitiesQuasi-governmental entitiesSocial Security AdministrationNational Conference of State Social Security Administrators (NCSSSA)Government associationsPractitioner organizationsExamples of Government Associations: National Conference of State Social Security Administrators (NCSSSA), associations of school board officials, such as TASBO, (Texas Association of School Board Officials), associations of fire officials, such as International Association of Fire Chiefs (IAFC) and the National Fire and Rescue Association, associations of counties/cities, etc.Examples of Practitioner Organizations: American Payroll Association, American Bar Association, AICPA
7 Examples Of Quasi- Governmental Agencies United States Postal ServiceFederal Deposit Insurance Corp (FDIC)Government National Mortgage AssociationResolution TrustTennessee Valley AuthorityNational Railroad Passenger Corp. (Amtrak)Federal Election CommissionOverseas Private Investment Corp.St. Lawrence Seaway Development Corp.
8 Unique FSLG Environment Impact on public servicesPolitical sensitivityApplication of Section 218 of the Social Security Act for State and Local GovernmentsJoint responsibility with Social Security Administration for Social Security and Medicare tax complianceIncome tax-exempt status – creates potential for accommodation of abusive transactionsIRC Section 115, i.e., what is a government?
9 FSLG Compliance Issues Information Return FilingEmployment Taxes (FITW, Social Security, Medicare)Incorrect or no Taxpayer Identification Numbers (TINs)Worker ClassificationFringe BenefitsBackup WithholdingSettlement PaymentsTaxation of Foreign Workers/VendorsAbusive Tax Avoidance TransactionsExcise Taxes
10 Two FSLG Compliance Initiatives 1. Federal AgencyLarge Entities (payrolls in excess of $40M)The customers of these two initiatives represent 38% of all governmental employers, accounting for 98% of government wage earners and taxes paid.FY2005 through 2007 closures:19 Federal Agency examinations54 Large entity examinations
11 FY2007 GE Enforcement Emphasis Increase in complexity of examinationsImprovement in compliance check selection processAnalysis of type of compliance treatment- Focused examinations- Taxpayer burden reduction- Voluntary compliance programs- Role of education and outreach