SSN Policy Manual

Dealing With Federal Agencies

not been issued. The Internal Revenue Service has the burden of proof to show that a social security number has been issued.

Internal Revenue Service The best kept secret in America is that the Internal Revenue Service never contacts or issues correspondence regarding income tax to citizens who do not have, or use, a social security number. Certainly it is more difficult for the IRS and other government agencies to track people who have no social security number . . . which is why they push so hard to get everybody enumerated. Of course, every American who owes income tax should pay what they owe . . . whether they are enumerated or not. Since unenumerated people pay exactly what they owe, they are more responsible and honest than government agencies that perpetuate the fi-aud, or the people who acquiesce in ignorance. Any person who does not have a social security number may still pay any income they wish or any income tax that they owe. ... omission of isolated information not seriously hamperingthe IRS's ability to check a taxpayer's asserted tax liability -- for example, the omission of a taxpayer's social security number or the nondisclosureof the names of one's dependent children -- does not invalidate a return under section 7203. United States v. Grabinski, 727 F.2d 681, 686-87 (8th Cir. 1984) The 31% Withholding Myth Most people, businesses and banks have been told that they must withhold 31 percent of a payment from a person who does not provide their social security number. Most people, when threatened with a 3 1% withholding from their pay, quickly give in to the demand that they must provide a social security number. The threat of the 31% assessment is based upon the reading of 26 USC $3406: In the case of any reportable payment, if - (A) the payee fails to furnish his TIN to the payor in the manner required, (B) the Secretary notifies the payor that the TIN furnished by the payee is incorrect, (C) there has been a notified payee underreporting described in subsection (c), or (D) there has been a payee certification failure described in subsection (d), then the payor shall deduct and withhold from such payment a tax equal to 31 percent of such payment. (2) Subparagraphs (C) and (D) of paragraph (1) apply only to interest and dividend payments Subparagraphs (C) and (D) of paragraph (1) shall apply only to reportable interest or dividend payments. 26 USC s3406. Backup withholding (a) Requirement to deduct and withhold (1) In general