SB/SE Payroll Tax Issue Committee Meeting Minutes

March 20 2004
Las Vegas, NV

Attendance

• Jim Abraham
• Clayton Agena
• Charlotte Cassady
• Maria Hermann
• Theodore Perros
• Charles Silva
• Leonard Steinberg
• Frank Woods
• Steven Wood

Staff

• Margie Kinney, Program Owner
• Judi Nicholas, Designated Federal Official
• Mary Peterson O'Brien, Program Analyst

Announcements/ Discussion
The committee discussed the recommendations from the March 19th meeting. It was decided that each subcommittee would take the comments and suggestions from Margie and other panel member and schedule subcommittee meetings to finalize recommendations.

Form W-4 Discussion
Margie restated what she would like the committee to contribute to the task force.

Action Item: Margie will provide Mary with portions of the report from the IRS task force. Mary will send the report to the committee.

Employer problems relating to Form W4:

IRS survey’s show that most employers don’t want to be required to do any more work than they do now. For any recommendations, Margie would like the panel to consider the burden to employers:

• Cost to employer
• Perception of employers
• Bring to employers the consequences of perceptions or actions

Margie discussed the “Questionable Form W4 Program” Erroneous W4 could include the number of exemptions claimed, or exempt status and social security or taxpayer identification number match. The penalty associated with erroneous From W4 is a fifty dollar fine. It is a burden to the employer to validate a questionable Form W4.

Margie discussed the new hire requirements for From W4 administered by Health and Human Resources. The program was developed to increase child support compliance.

It was discussed that correct Form W4 information also impacts the Social Security Administration. Correct information enables SSA to credit a person’s lifetime benefits.

What would be the benefit if only one agency was responsible for all of the agencies? Currently, HHS pays 2/3rds of the cost of maintaining the databases for all states.

By consensus, it was decided to work the Form W4 issue in two subcommittees. One subcommittee will focus on issues relating to the employer and the other will focus on issues relating to the employee. Both will concentrate on recommendations on how the process might be simplified.

Areas of Focus:
Employee Subcommittee: Dealing with Forms and Schedules.
Employer Subcommittee: Accuracy of names and TINS, Reporting

Next Steps
Steve’s committee will work the Employer perspective.
Frank’s committee will work the Employee perspective. Jim will take over as the subcommittee chair.

Action Item: Judi will email the committee with the commissioner’s testimony regarding ITIN’s.

Conclusion
Leonard asked if there was any other business to discuss. The committee agreed that this was a productive and good meeting. Thank you’s were made to members and the staff. Special thanks were given to Margie from the panel on all of her hard work and the time she has spent with this committee.

Next meeting will be on Wednesday, May 5th at 3pm Eastern Time via teleconference.