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B-221982 1 (1986-08-18)

handle is hein.gao/gaobadmkw0001 and id is 1 raw text is: DECllON .K FILE: B-221982 THE COMPTROLLER GENERAL OP THE UNITEO STATE WASHINGTON, D.C. 20548 DATE: August 18, 1986 MATTER OF: Equal Employment Opportunity Commission--With- holding of Taxes from Judgments DIGEST: 1. The Equal Employment Opportunity Commission (EEOC) is not required to withhold employee payroll taxes or pay employer excise taxes under the Railroad Retirement Tax Act, 26 U.S.C. §§ 3201-3233, when it distributes judgment proceeds to the employees of railroad companies unless provided for in the judg- ment. 2. The Equal Employment Opportunity Commission (EEOC) appropriation is not available to pay employment taxes on amounts distributed to employees from back pay judgments paid to the EEOC in enforcement actions brought by the EEOC. Appropriations can be used only for their intended purposes. Payment of these taxes cannot be viewed as a necessary ex- pense under EEOC's appropriations because it would not contribute to fulfilling the pur- poses for which those appropriations were made. The Equal Employment Opportunity Commission (EEOC) has requested our decision on whether the EEOC may pay certain employment taxes from its appropriated funds. The Internal Revenue Service (IRS) has determined that under the Railroad Retirement Tax Act, 26 U.S.C. SS 3201-3233 (1982) (RRTA), the EEOC must pay employer excise taxes, and should have withheld employee payroll taxes, on judgment proceeds it distributed to 220 former employees of 2 railroad companies. The proceeds were deposited with the EEOC when it settled an age discrimi- nation case against those companies. We hold that the EEOC is not required to withhold employee taxes when the judgment involved does not provide for withholding. We also hold that the EEOC's appropriations are not available to pay either tax. STATEMENT OF FACTS On March 9, 1984, a judgment which incorporated the terms of a settlement reached between the parties was rendered in

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