Lawmakers push bill to stop IRS bonuses

Lawmakers push bill to stop IRS bonuses
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Lawmakers on both sides of the aisle, furious that the IRS handed out more than $1 million in bonuses to employees delinquent on their own taxes, are pushing legislation to put a stop to those awards.

Two bipartisan groups of senators have already released legislation targeting the bonuses given to the IRS employees, just over a week after the Treasury Department’s inspector general for tax administration said the agency recently gave some $2.8 million in all to staffers with conduct issues.

Treasury Secretary Jack LewJacob (Jack) Joseph LewOvernight Finance: US reaches deal with ZTE | Lawmakers look to block it | Trump blasts Macron, Trudeau ahead of G-7 | Mexico files WTO complaint Obama-era Treasury secretary: Tax law will make bipartisan deficit-reduction talks harder GOP Senate report says Obama officials gave Iran access to US financial system MORE, the IRS and the National Treasury Employees Union (NTEU) have all said that the union and the agency are discussing ways to stop those bonuses from going out in the future.

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The IRS, already under fire for its improper scrutiny of Tea Party groups and a host of other missteps, has added that it already had a policy ensuring that senior executives with conduct issues didn’t get performance awards, and the agency was looking to expand it.

Even so, lawmakers said this week they should press ahead with legislation during negotiations between the IRS and the employees union.

Sens. Kelly AyotteKelly Ann AyotteErnst, Fischer to square off for leadership post The Hill's Morning Report: Koch Network re-evaluating midterm strategy amid frustrations with GOP Audit finds US Defense Department wasted hundreds of millions of taxpayer dollars MORE (R-N.H.) and Claire McCaskillClaire Conner McCaskillConservative group calls for ethics probe into McCaskill’s use of private plane Senate moderates hunt for compromise on family separation bill Election Countdown: Family separation policy may haunt GOP in November | Why Republican candidates are bracing for surprises | House Dems rake in record May haul | 'Dumpster fire' ad goes viral MORE (D-Mo.) released legislation this week seeking to ensure that federal employees in trouble with the law or their agency don’t get bonuses.

Sens. Richard BurrRichard Mauze BurrHillicon Valley: New FTC chief eyes shake up of tech regulation | Lawmakers target Google, Huawei partnership | Microsoft employees voice anger over ICE contract On The Money — Sponsored by Prudential — Senators hammers Ross on Trump tariffs | EU levies tariffs on US goods | Senate rejects Trump plan to claw back spending Senate Intel requests more testimony from Comey, McCabe MORE (R-N.C.) and Joe ManchinJoseph (Joe) ManchinThe Hill's Morning Report — Sponsored by PhRMA — Trump caves under immense pressure — what now? Election Countdown: Family separation policy may haunt GOP in November | Why Republican candidates are bracing for surprises | House Dems rake in record May haul | 'Dumpster fire' ad goes viral Manchin up 9 points over GOP challenger in W.Va. Senate race MORE (D-W.Va.) rolled out their own bill on the matter Wednesday, as did Rep. Sam JohnsonSamuel (Sam) Robert JohnsonMay brings key primaries across nation Loss of Ryan hits hard for House Republicans Watchdog: Social Security acting head hasn't been authorized to serve for months MORE (Texas), a senior Republican on the House Ways and Means Committee.

The $2.8 million in performance awards, given to some 2,800 employees between October 2010 and December 2012, represent just a fraction of the IRS budget in those years. Of those 2,800 employees, 1,100 with tax issues received roughly $1.1 million. Employees receiving performance awards were also granted extra time off.

But the report also came after IRS Commissioner John Koskinen angered lawmakers, especially Republicans, by awarding more than $60 million in bonuses, just months after the agency apologized for its treatment of conservative groups.

Koskinen’s predecessor, Danny Werfel, had sought to block the awards, which included some of the bonuses eventually given to staffers delinquent on their taxes.

Rep. Ander Crenshaw (R-Fla.), the chairman of the House Appropriations subcommittee that oversees the IRS, said the newest bonus issue was just another strike against an agency also criticized last year for spending on conferences and producing a video knockoff of “Star Trek.”

“They’re not going to get a whole lot more money if that’s the way they’re spending the money now,” said Crenshaw. “You better spend the money you’ve got wisely before you ask for more money.”

House Republicans sought deep cuts to the IRS budget least year, while Koskinen and the Obama administration say it’s counterproductive to slash funds for the government’s revenue collector.

Koskinen, appearing before a Senate Appropriations subcommittee on Wednesday, stressed that ensuring employees with conduct issues don’t get bonuses would be a priority as the agency negotiates a new contract with the Treasury employees union.

Under current law, a federal employee’s conduct and reviews of their job performance are kept separate.

“My view is that employees understand they work for the IRS and are held to a higher standard,” Koskinen said. “People ought to be comfortable that if you work for the IRS and I’m chasing you for your taxes, I should pay mine.”

Lew, in a separate appearance this week, also said the current policy had to change. He didn’t completely rule out seeking to recoup the bonuses already handed out.

Still, Koskinen and the NTEU also noted that IRS employees were far better than most at keeping up with their taxes, with the commissioner saying agency staffers have a roughly 99 percent compliance rate.

Colleen Kelley, NTEU’s president, added that the union would “work with the IRS on an appropriate plan” for linking performance awards with employee conduct.

Koskinen told reporters after Wednesday’s hearing that he hoped lawmakers would allow his agency and the employees union to negotiate before enacting any legislation, saying he feared Congress would lump in staffers consciously not paying their taxes with staffers who might have legitimate issues.

“I think we don’t have any disagreement with the people who are trying to pass legislation,” Koskinen said. “If you have just an on-off switch, you’re likely to sweep in people you didn’t intend to. My hope would be people would see what we are able to negotiate with the union.”

Some congressional Democrats quickly got behind that stance. “I think we should give them a chance,” said Sen. Ben CardinBenjamin (Ben) Louis CardinCommunity development impact remains clear with NMTC post-tax reform Dem sen: ‘Difficult to understand’ Trump’s treatment of allies Dem sen: No military option in North Korea ‘without extreme risks’ MORE (D-Md.), a member of the Finance Committee.

Sen. Orrin HatchOrrin Grant HatchOn The Money — Sponsored by Prudential — Senators hammers Ross on Trump tariffs | EU levies tariffs on US goods | Senate rejects Trump plan to claw back spending Senators hammer Ross over Trump tariffs Top Finance Dem wants panel to investigate Trump Foundation MORE (Utah), the top Republican on the Finance Committee, said he didn’t see a way for the government to claw the bonuses back.

“I always hope that the IRS commissioner can work these things out with the unions, Hatch said. “I think the unions are very difficult to deal with.”