Resolving Differences in Wage Amounts Reported by Employers to IRS and SSA

Gao ID: T-HRD-88-29 August 9, 1988

GAO discussed the 1988 interagency agreement for the Combined Annual Wage Reporting System between the Internal Revenue Service (IRS) and the Social Security Administration (SSA). GAO found that the agreement: (1) was an improvement over the prior arrangement; (2) should allow SSA to record more employees' social-security-covered earnings; (3) should allow IRS and SSA to more effectively reconcile employer reporting differences; (4) should reduce future occurrences of reporting differences; (5) recognized the agencies' responsibilities and enforcement authorities for wage reporting; (6) more clearly delineated responsibilities and performance records; and (7) established accountability for nonperformance. GAO also found that: (1) under the old system, SSA had limited success in resolving the backlog of unreconciled cases; and (2) future reconciliation efforts should be more successful, since SSA and IRS will make employer contacts soon after they receive wage reports, increasing the chances that employers will still be in business and have the necessary records.

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