Federal Forum: Mergers, Withholding Errors, Child Support


IRS steps

In a merger or acquisition, an employer may treat employees from the acquired company as new hires for purposes of filing Form I-9, Employment Eligibility Verification, an agency official said May 17.

“If you’re going to treat them as new hires, then obviously, you would file a new I-9. Or, you could accept the I-9s from the previous employer,” said Dave Basham, an analyst with the Department of Homeland Security’s U.S. Citizenship and Immigration Services. “But you have to be uniform with that.” 

New-hire reporting deadlines still apply, but employers do not need to wait until the first day that an employee starts work to file Form I-9, Basham said at a federal forum held at the American Payroll Congress in National Harbor, Md. 

The form may be completed when the employee accepts the position, which will probably be a couple of months before the merger is finalized, he said.

Correcting Records

The Social Security Administration does not accept employer corrections to an employee’s record for withholding errors older than the statute of limitations, which is three years, said Scott Pedersen, a Social Security Administration program manager.

However, the employer may issue Form W-2c, Corrected Wage and Tax Statement, for the employee to present to the Social Security Administration to correct the earnings record, Pedersen said. 

When an employee’s Social Security card has only one name, the employee should refer to documents issued by the Department of Homeland Security to confirm what should be entered as a first name for employment forms, Pedersen said. 

The full name in the Department of Homeland Security database also is in the Social Security Administration database, he said.

Usually, there is an abbreviation, UNK, that may take the place of a first name, and the name on the Social Security card is to be treated as the last name, Pedersen said. The Social Security Administration system does not accept single names, or mononyms, which employers should keep in mind if they have systems that do accept single names, he said. 

Confirm Court Orders

When an employee presents a signed court order to stop child support withholding, the employer should instruct the employee to ask the child support agency to confirm that withholding may stop, said Sherri Grigsby, manager of employer services for the Department of Health and Human Services’ Office of Child Support Enforcement. 

The employer also may call the child support agency directly, Grigsby said.