[BobNJ1960]

1,445 State Employees Didn't File Connecticut Tax Returns Despite 'Special Duty' To Do So - Hartford Courant

Amazing. Ct should follow the example of the IRS and sentence them to time in prison. Set an example.

[BicoastalAnn]

I don't understand how this can happen. It's not like they were getting paid under the table... it was all in the system. Crazy that in her case it went all the way back to 2007... A few years ago I accidentally underpaid my taxes by about $200 (forgot about a TINY consulting gig I did) and NY state caught up with me within the same year AND fined me, with interest.

[beer belly]

Won't let me read the article.

[BobNJ1960]

Originally Posted by beer belly

Won't let me read the article.

Here it is pasted.

"Stephanie Elliott, a nurse at Connecticut Valley Hospital in Middletown, was sentenced to 16 months in federal prison Friday for evading federal income taxes from 2007 to 2012.
She was the first to be sentenced out of four government workers in Connecticut who have pleaded guilty in the past year to federal charges that they failed to pay taxes on their taxpayer-funded salaries. The other three await sentencing.
It's all part of an effort by the IRS, along with office of the U.S. Attorney for Connecticut, Deirdre M. Daly, to crack down on employees of either the state or a regional public authority who have illegally avoided paying taxes on income from their taxpayer-funded jobs.
Government Employee Jailed For Tax EvasionEDMUND H. MAHONY




The IRS checked on Connecticut state employees and others who had little or no federal withholding taken out of their paychecks, and who had failed to file income tax returns. Investigators found that scores of state employees may have engaged in schemes to avoid paying federal income taxes, prosecutors said in a recent pre-sentencing memo in the Elliott case.
The feds also have made similar crackdown efforts in other New England states.
The federal law enforcement efforts raise this question locally: What is Connecticut, at its level of jurisdiction, doing about the problem of state employees who don't pay their Connecticut income taxes?
The answer, according to Kevin B. Sullivan, commissioner of the Department of Revenue Services, is that his Connecticut tax agency exchanges information with the IRS and annually uses computer technology to find state employees who haven't filed state income tax returns.

He said that the department now is in the midst of pursuing 1,445 state employees who did not file Connecticut state income tax returns for 2012, the most recent tax year for which state and federal data has been processed for computer analysis. The 1,445 state-employee non-filers were all sent letters early this year, telling them that they need to file returns and pay taxes.
Arrests for state income-tax-related offenses are "few and far between" a department spokeswoman said. Instead, the state seeks compliance through administrative procedures and civil sanctions — and, so far, 421 of the 1,445 non-filers from 2012 have resolved their cases by paying or by going on an installment plan to pay the taxes they owe.
In addition to paying the back taxes owed, there is also a 10 percent penalty for being late, plus a charge of 1 percent per month in interest until the full amount is paid.
So far, the 421 who have resolved their problem have paid $149,000 collectively — or about $350 each — as either payment in full, or payments toward their full obligation, Sullivan said.

cComments

• @Paul28 Absolutely would target them. Their names should be made public. It is more repulsive for state employees not to file returns and pay their taxes since all of us are paying their salaries unlike in the private sector.

That leaves 1,024 who haven't resolved their problems. Some of them are being audited while some soon will get bills for 2012 state income taxes based on income that more them 500 of them reported on federal tax returns that they filed with the IRS.
The 1,445 non-filers in the state's work force are part of a total of about 40,000 people statewide who didn't file Connecticut state income tax returns for that year. The percentage of non-filers is roughly the same for the state's 45,000 or so state employees as the general population of about 1.3 million state taxpayers — about 3 percent, officials said.
The same collection efforts are applied to all the non-filers, whether or not they work for the state. But Sullivan and the Department of Revenue Services say that state employees, who are paid by taxpayers, have a greater responsibility to comply.
'Special Duty'


"The funding that supports state programs, services and state employees relies on the good faith, voluntary compliance of all of our taxpayers. All of us who work for state government have a special duty because the state is our employer," according to the letter that the department sent to the state workers who didn't file their 2012 Connecticut returns.
"We urge you to set a positive example and avoid the consequences for failing to comply with the Connecticut income tax filing requirements," the letter continued. "The consequences can include the issuance of tax assessments, which may include penalties and interest. If your tax obligations are not paid, the DRS will take appropriate enforcement actions against you that include tax liens and warrants to attach wages, bank accounts and/or other assets."
Come January, the department will start the process anew on 2013 non-filers, said Sullivan's tax division chief, L. Michael Romeo, Jr.
Sullivan said in a phone interview that 1,445 non-filers among state employees are "not an insignificant number of folks who either have erroneously or deliberately minimized their payment of state income taxes even though their compensation was provided by the state of Connecticut."
He said that at the Department of Revenue Services, it's a firing offense to evade state income taxes. "What would be the worst possible thing? Somebody collecting your taxes and not paying theirs," he said – although he added that he hasn't had to fire anyone in his five years as commissioner.
One of the methods people have used to avoid paying income taxes is to have their employers deduct too little, or even nothing, from their paychecks.
All employees must fill out a W-4 withholding certificate, on which they can claim exemptions that cause employers to reduce the amount they withhold in taxes. Most people claim only a couple or few legitimate exemptions — for dependent children or other relatives. But Elliott, for example, claimed 99 exemptions on her form, according to federal prosecutors.
The IRS twice contacted the state, in 2008 and 2011, and asked that her employer — the Department of Mental Health and Addiction Services — see to it that the maximum percentage be withheld from Elliott's paychecks for taxes. But although computer notations were made in the state's system, nothing changed and the withholding amount remained at zero, prosecutors said in a pre-sentencing memorandum.
Sullivan, whose department does not handle those withholding forms, said the state is moving toward improving its computerized processes for monitoring tax withholding so it can better detect things like "inordinate numbers of exemptions, or inordinate under-withholding."
All told, the ongoing federal investigation that nabbed Elliott indicates that "there are at least 80 individuals who work for the State or a State of Connecticut agency who appear to be engaged in a tax evasion scheme, and Elliott is at the top of that heap by almost any measure, whether it be total tax loss, number of consecutive years of evasion, level of gross income, or lack of mitigating factors," according to the recent pre-sentencing memo in the Elliott case.




Elliott, 42, of West Hartford, had been reporting for work at CVH up to the time of Friday's sentencing; the federal tax-evasion charges didn't affect her state employment. But a spokeswoman for DMHAS, Mary Kate Mason, said Friday that "she will resign her position if she goes to jail."


Elliott's wages ranged from about $52,000 in 2007 to nearly $137,000 in 2012. Her base state salary recently has been about $61,000. That means she received a lot of overtime and "differential" payments for working night and weekend shifts, Mason said. Elliott is not in a position to retire from state service; she would not be eligible until 2027, according to the office of the state comptroller."

[HumpDay]

Fire them

[AnonChick]

Originally Posted by HumpDay

Fire them

They need to be fired "for cause" so that they are not eligible to collect unemployment. So not just "fired" but fired "for cause." Otherwise they'll just collect more taxpayer money, and won't have to do anything to earn it for 26 weeks.

I'm exempt from state taxes, but only because Anonhubby and I get a refund every year. That's with me being exempt. If I didn't claim "exempt" our refund would be bigger. We'd rather not let the government hold our money all year long without paying us interest. (He is not exempt. Just me. I work part time retail, they rarely take fed tax out because I don't usually earn enough weekly for it to be deducted)

[JayCT]

It is not against the law to have no or minimal taxes taken out of your pay check so the state really cannot do anything about this unless the employees are convicted of a crime like tax evasion. Even then I am not sure if that is reason enough to fire them or not. The number seems high but it may be in line with people that are privately employed. The article should have noted how this figure compares with private sector employees or the employees of other state. Jay

[AnonChick]

Originally Posted by JayCT

It is not against the law to have no or minimal taxes taken out of your pay check so the state really cannot do anything about this unless the employees are convicted of a crime like tax evasion. Even then I am not sure if that is reason enough to fire them or not. The number seems high but it may be in line with people that are privately employed. The article should have noted how this figure compares with private sector employees or the employees of other state. Jay

I think they should be fired, because they were being paid with taxpayer money as employees of a government-funded hospital. The abused the privilege and responsibility that goes along with taking government money - they should cease to be entitled to that money. The only way to cease to be entitled to that money is if they are a) fired or b) forced to work there for no pay.

[BobNJ1960]

Originally Posted by JayCT

It is not against the law to have no or minimal taxes taken out of your pay check so the state really cannot do anything about this unless the employees are convicted of a crime like tax evasion. Even then I am not sure if that is reason enough to fire them or not. The number seems high but it may be in line with people that are privately employed. The article should have noted how this figure compares with private sector employees or the employees of other state. Jay

It is against the law to NOT file taxes. That is what these criminals did.

[clutchrider]

It is not against the law to file little withholding or exemption but it is against the law to not file. As stated above.

I just play it safe and claim 0 so the highest is taken out. Regardless if I have a child I still don't claim them until I file because I'd rather get money back than owe.