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Employees With U.S. Security Clearances Owe $85 Million in Taxes

Oct. 31 (Bloomberg) -- Thousands of federal employees and contractors approved for security clearances from 2006 to 2011 owed $85 million in unpaid federal taxes, according to a report released today by congressional investigators.

The Government Accountability Office said half of the 8,400 individuals who owed taxes had made arrangements with the Internal Revenue Service to settle their tax debts. About 4,700 were employees and the rest worked for contractors.

Debts ranged from $100 to more than $2 million. The money was owed as of June 2012.

The GAO looked at individuals who were approved for clearances from April 1, 2006, to Dec. 31, 2011, and those who held the designation before then. Three-fourths of those who owed taxes didn’t become delinquent until after they received their clearances, the report said.

Senator Tom Coburn of Oklahoma, the ranking Republican on the Homeland Security and Government Affairs Committee, said action is needed to prevent those owing back taxes from getting security clearances.

“Giving security clearances to individuals that fail to follow the law is unwise and unnecessarily puts our nation’s classified information at risk,” Coburn said in a statement. “Federal tax cheats with security clearances are double threats that jeopardize both our national and economic security.”

Almost 700 IRS contractor employees owed $5.4 million in taxes, according to a report released Oct. 23 by the Treasury Inspector General for Tax Administration. The report said 339 of the 691 contractors that owed taxes had agreed to plans to erase their debts.

To contact the reporter on this story: Jonathan D. Salant in Washington at jsalant@bloomberg.net

To contact the editor responsible for this story: Stephanie Stoughton at sstoughton@bloomberg.net

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