Chaffetz Introduces Bill to Hold Tax Delinquent Federal Employees and Contractors Accountable

Published: Jan 10, 2017

Tax delinquency totaling billions

WASHINGTON – Today, House Oversight and Government Reform Committee Chairman Jason Chaffetz (R-UT) introduced H.R. 396, the Tax Accountability Act, which renders individuals with seriously delinquent tax debt ineligible for federal civilian employment, contracts, or grants.

After introducing the bill, Chairman Chaffetz released the following statement:

“Federal employees, contractors, and grant recipients are not above the law. In fact, individuals responsible for federal resources should set the standard for upholding their civic responsibility. Yet, year after year their tax delinquency is resulting in more than $1 billion owed to the federal treasury annually. This legislation ensures that these individuals are satisfying their tax obligations.”


IRS data show more than 100,000 federal civilian employees owed more than $1 billion in unpaid federal income taxes in FY2015.

Additionally, the Government Accountability Office (GAO) found thousands of federal contractors with substantial amounts of unpaid federal taxes. GAO previously reported approximately 63,800 contractors (27,000 defense contractors, 33,000 civilian agency contractors, and 3,800 General Services Administration contractors) owed more than $7 billion in back taxes.

Chairman Chaffetz also introduced H.R. 397, the Members of Congress Tax Accountability Act. Similar versions of this bill were first introduced in the 112th Congress.

Bill Highlights:

  • Contractors, grant recipients, and individuals applying for federal employment will be required to certify their tax status when submitting a proposal or application for contracts and grants, or employment.
  • If the agency finds the contractor or grant applicant does have seriously delinquent tax debt, then they would be referred for suspension or debarment and would not be eligible for a new contract or grant.
  • The bill exempts federal employees or applicants working to settle their tax disputes and resolve outstanding liabilities, and provides a financial hardship exemption if the individual’s service is in the best interests of the United States.
  • Federal employees will be provided 180 days to demonstrate that they meet one of the exemptions in the legislation.