IRS, W-2s, and SS Names
crawfod
204 Posts
Our Payroll Department came to me and said we needed to verify that every employee's NAME that goes on the 2003 W-2 MUST MATCH EXACTLY the name that is on their Social Security Card. The IRS representative I called confirmed that the 2003 Tax Act that went into effect 7/1/03 did have that wording, but he admitted the IRS had not decided whether or not they would reject tax returns that included W-2s that did not match SS names, or any other penalties for employers who do not comply. He did say that if the name on the SS card is John Michael Smith, then J. Michael Smith, Johnny Smith, John Smith, or any other variation would not meet the requirements.
Has anyone heard about this and what are you doing about it? While we have copied SS cards for I-9 purposes for a number of years and filed them in their Personnel Files, we have many employees who were hired before November 6, 1986, that we do not have cards on, not even counting the ones who have had name changes due to marriage or divorce. Plus, if a new employee called himself J. Michael Smith, that is how we entered his name in Payroll. Since we use Seasonal employees, we probably will issue around 500 W-2s this year, a big enough number for us but pales in comparison to some of your organizations. People are sensitive enough about their SS Cards, rightfully so, and so this project does not bode well.
Has anyone heard about this and what are you doing about it? While we have copied SS cards for I-9 purposes for a number of years and filed them in their Personnel Files, we have many employees who were hired before November 6, 1986, that we do not have cards on, not even counting the ones who have had name changes due to marriage or divorce. Plus, if a new employee called himself J. Michael Smith, that is how we entered his name in Payroll. Since we use Seasonal employees, we probably will issue around 500 W-2s this year, a big enough number for us but pales in comparison to some of your organizations. People are sensitive enough about their SS Cards, rightfully so, and so this project does not bode well.
Comments
The only way to get to a new beginning is to have the corporate body get a start on correcting the garbage in our government computer systems, which we helped over time to create with bad data input (unknowning and human error for the most part)and to deal with the cases as they present themselves to us on the ground. I am currently dealing with the 13 cases mentioned above; we have already corrected 5 US citizen cases: two were wrong sex, 2 were incorrect didgits in the ssn, and 1 was an incorrect spelling of an ethnic first name.
The 13 foreign national CASES are in the process of identification and application for a change in their illegal status.
All applications are currently in the hands of DOL and waiting DOL approval and registration. After which the cases will be sent to INS for their approval, after which, the cases will be sent to the SSA for their approval and assignment of a correct ssn and name to match///followed by a submission to IRS for a delete of the false name and number, FOLLOWED BY, an input of the correct name and number; at which time the IRS will turn loose of the TAX DOLLARS COLLECTED BY US IN THE NAME OF THE FALSE NAME AND SSN.
Is it not fun to be in the middle of all this RED TAPE AND TO THINK I'VE GOT TO FIGHT EVERY "NUMBNUT STAFFER" ON THE WAY!
It is almost enough to make me retire again!!!!
Good Luck with those of you out there that have more than a small bunch of these mismatched cases. If you don't know about it you better find out if you have a issue or not. SSA contacts tell me after 2003 the ball will be running down hill and picking up steam, those not already involved will get crushed with the impact of the action.
WARM REGARDS AND MAY WE HAVE A BLESSED TUESDAY 9/16,2003!
PORK
I sent a memo to each of our location directors explaining the new requirement and advised them that if we are fined their individual location will pay the $50 fine, not the HR department.
Corrections were made in the time & attendance system, and one director went so far as to type the names IN ALL CAPITAL LETTERS because that is how they appear on SS cards these days. Gotta love it when they follow directions to the letter! x:D
PORK
GLAD I COULD HELP!
x;-)
Long before I worked here, one of our employees wrote their name down on the W-4 in such a sloppy manner, the HR person at the time, did their best, and entered what they saw on the W-4 into our payroll system. Every since then this employee's name has been written wrong on every piece of mail, every paycheck, etc. Did they ever come up to correct - no, he's a really nice person and he doesn't like to 'create waves', so it was never corrected. This year, he gave me a letter from the IRS that stated they could not process his tax return (about $1000) because the name on his SSN does not match the W-2 information supplied.
Learning lesson - ask all new hires to provide their legal name - provide a spot on forms for 'nicknames' and keep employees well informed on why HR needs any changes to the employees information.
This has helped somewhat with the new hires.
Our organization will issue 600+ W2 forms for 2003. So far, we have taken the confirmation step through the SSA EVS system and had about 35 mismatches identified by SSA. That step was much easier and quicker than I thought it would be. As it turns out, I submitted all names in lower case, and none of the mismatches resulted from upper vs. lower case. We predominantly found the mismatches to be name changes due to marriage/divorce and typographical errors on the part of HR personnel at the data entry stage. Very few other issues surfaced. My next step is the correction step. Many in-house corrections will be easy as we have copies of SS cards with I-9 forms for many employees. Some we don't, and those may be a challenge, but the publication I have describes that as long as we document our notice to affected employees that there is a mismatch they must correct through SSA, we should be relieved of any penalty. I understand the concept, but developing a process whereby we take the necessary steps is proving a little challenging for me. I still have to develop the notice to affected employees, and confirm that we have corrected, through the W2c, employee information for those for whom earnings have already been reported. I'm also thinking of adding a brief statement (that must be signed by new hires) to our new-hire package of paperwork that describes that we will take the verification step for all new employees and describe what the employee can expect from us if a mismatch is identified (i.e., request SS card to confirm our accuracy, employee must correct name changes or other issues with SSA). I'm a little challenged at the moment on how the wording should be and am open to suggestions. I'm also interested to know what other organizations are doing.
Thanks, flowers in Florida
Truthfully, while employees are protective of their information...if you level with them and explain why this needs to be done and why it's a benefit to them, then they will be more likely to comply.
I can't tell you how many turned up that had never updated their cards after marriage/divorce....in the long run, it helps everyone!
When I originally called SS and asked if I provided them a list of all our employees would they verify the names, they said No, due to privacy issues. However, I have heard SS may be willing to do 50 names at a time, so that is my next call Monday. I too would be interested in this SSA EVS system your'e referring to. If SS won't help, then I will send a list of the remaining names to each department and ask them to make a copy of the card, explaining why. I will also tell them if employees are hesitant to show the card, I will allow them to mark through the number on the copy, since I am only interested in verifying the name. I will also tell them what the IRS told me, that there was a possibility the IRS could reject tax returns from employees whose W-2 didn't match the SS base. That should get their attention.
Any help on where or how I should begin this process I MEAN SQUARE ONE! would be great!
I am sure we should have most copies, we have around 311 EE's here and should have most copies of ss cards with I-9's also. Is my first step to go through each I-9 file and verify that name with the name we are turning over for W-2's? x:-/
Debbie W.
When I called the local SS office and spoke to a personal friend, he said I could send him a list of those I did not have cards on, and he would do what he could. He told me technically he could only verify a mismatch, due to privacy reasons, and that normally he could not give me the correct SS name. However, he indicated he would do what he could and if it was a minor difference (say "Steven", instead of our "Steve") he would let me know.
What I am confused about was that he did not give me any suggestions about using this EVS option, and he did not mention anything about a "50 name rule". The 570 number DebbieW gave is long distance, so I am just going to try my local method. Another confusing part was that he said SS generally will accept what name the requestor puts on the application. So if someone puts J. Michael Smith on their SS application, that's the way it will go on the card, unless the agent presses the requestor to fill out the whole name. I found a card with the first name "Bill" on his card, but his birth name is clearly "William".
Eventually I may have to go to some employees and ask to see their card. I think if you make a good faith effort to address this issue, the IRS will be forgiving for a few discrepancies. It is still not clear who will bear the burden of the discrepancy: the person who submits the tax return with the "bad" W-2, or the employer who issued it and had not used the SS name.
Thanks a million...this was exactly what I needed a place to start, there are some definite confusing pieces, I am a bit confused as to why you would have to ask employees to see there cards, shouldn't we have a copy of EVERYONES card? Or are you speaking of people that were somehow over looked or started before 86'? Sorry I am playing catch-up on this project...as you can tell...Thanks a bunch!
If you want to communicate with me directly, my email is [email]crawfod@bellsouth.net[/email]. Note that although my real name is crawford, I had to take crawfod, without the r, for bellsouth's network.
There are some instructions and access to the EVS instruction booklet available online at [url]http://www.ssa.gov/employer/ssnv.htm[/url] as well as a short FAQ sheet. As far as adverse action, the following entry is a direct copy/paste from the FAQ sheet:
Legal Policy - Don't Discriminate or Misuse EVS - SSA will advise you if a name/SSN you submitted does not match our records. This does not imply that you or your employee intentionally provided incorrect information about the employee's name or SSN. It is not a basis, in and of itself, for you to take any adverse action against the employee, such as laying off, suspending, firing, or discriminating against an individual who appears on the list. EVS should only be used to verify currently or previously employed workers. Company policy concerning the use of EVS should be applied consistently to all workers, e.g. if used for newly hired employees, verify all newly hired employees; if used to verify your data base, verify the entire data base. Any employer that uses the information SSA provides regarding name/SSN verification to justify taking adverse action against an employee may violate state or federal law and be subject to legal consequences. Moreover, this makes no statement about your employee's immigration status.
We currently plan no adverse action against employees for whom mismatches have been identified. Our mismatch rate is about 5.5%, out of just over 600 names who are expected to receive W2 forms for 2003. Nearly half of the errors resulted from typographical errors on our part in the data entry process. Most of the rest resulted from employees' failure to notify SSA after a name change (marriage/divorce). We do plan to document extensively the steps we have taken, including notifications to employees that they must correct their errors and provide proof to us for confirmation.
I am also developing a method to ensure verification is part of our routine hiring process, including advising new employees that we will complete the verification and what they can expect from us if we find a mismatch as well as another boilerplate-type notice to an employee for whom a mismatch is located. I'm find the creating step to be time consuming, requiring more time than I think I can spare at the moment. I'm also challenged at the moment to develop a method for ensuring that employees notify Personnel in future years that they have married/divorced, thus had a name change. Ideally, employees should be doing that on a routine basis, but I think we all know that the divide between ideal and actual can be wide. We already encourage that information because of its potential impact on benefits, and I thought we were doing pretty well with it, but nearly a dozen of our mismatches were marriages/divorces that we didn't know about.
Best wishes to you all. As you develop your processes, and if you are willing, please post them.
flowers in Florida
I am not sure I want to do it this way. Why you ask?
When I started with this company I started checking with ss for proper matches. I found an ee that did not match, she was informed of the mismatch and chose not to come back. This was February this year. This past month she came in to reapply (what nerve) and provided a copy of her "new" drivers license & ss card. I was pondering this since she looked really familiar to me. I phoned ss to check and they told me they were a match!
I then discovered who she was and pulled the file. This person obtained new documents. New birthdate and name and different ss number, picture is exact!
What happens when social security thinks these are good documents?
Of course we did not hire her. But what if I did not have prior documents to confirm my suspision? Am I obligated to call social security and tell them of their error?
Research is either scarce on this subject, or I am very obtuse. I'm finding it very hard to find clear instructions on what to do, but one of the details I found last week described that all names should be recorded by the employer as the name appears on the social security card, and when a name change occurs, the employer should retain the original name until a new SS card is produced. Info at SSA.gov also describes that while employers are not required to make copies of SS cards, employers can ask and employees must produce cards for review. Because earnings would continue to be reported under the incorrect name or a bank issue may result if the employee has direct deposit, the employee may be motivated to be very cooperative and very prompt. I'm only two years into HR, so much of this is new to me. There has also been significant turnover within the last five years among my company's personnel/payroll staff. At 2 years into the job, I have seniority over every other employee we have associated with the payroll/personnel administration process. That turnover has created some of our problems. Past HR/payroll staff either relaxed their requirements or were grossly inexperienced and allowed the use of slang/nick names in HR records or failed to request reliable documentation to support name changes. I've been working on correcting the names to formal names for more than a year. This SSA EVS step is a new step but is a step in a process that had already begun for us.
By strictly following these rules, we have had a minimum number of problems with the IRS / SSA, etc.
Suspension from work in order to go to the SSA to get a mis-match fixed is not discrimination against the ee. If they clock out and go to the SSA and discover it was the companies' fault, then you simply add their hours to their clock work for this week. If the error was the fault of the ee then the ee just simply caused his/her own problem with the mis-match and must get it fixed with the SSA and IRS.
Guess what: if the mis-match is a result of false identification the concerned ee simply never returns, and you have to terminate due to no call no show after three days, if that is your companies' policy. Besides, the Department of Labor has told me that an illegal alien is outside of the EEOC rules and regulations, the foreign national who is illegal has no status under our laws. I hope to soon have that in writing from the DOL and I'll share it with all of yyyooouuuuuu!
As an up-date to all out there wondering, how my 13 illegals are coming. 3 have departed on their own, 10 are still working and waiting on DOL disapproval of their "right to work under the amnesty program". It has come to pass that the process called for us to advertise for the hire of US Citizens, now after two years of waiting with the economy still in the pits and UI high. If we get responses to the ad, then we will not get an approval to hire an illegal alien, who is already hired. I have never advertised for labor positions because we get all we can take from our UI rolls in this state. Therefore, we will have to terminate or be proven as harboring "illegal Immigrants" and suffer the fees and fines for their continued employment. IT APPEARS PECO'S ACTION OF TERMINATION OF 200 ILLEGALS WAS A WISE MOVE.
IT IS THIS SITUATION THAT IS OF GREAT CONCERN WITH 6.4 MILLION FOREIGN WORKERS WITH FALSE IDs WORKING ALL OVER OUR COUNTRY, THAT CAUSED THE MISMATCH SYSTEM TO COME INTO PLAY. THE GOVENMENT WANTS THEM ALL TO GO HOME! THE AMNESTY PROGRAM IS A WASHING MACHINE AND THE DRAIN CYCLE IS ABOUT TO COME AROUND.
PORK