B-146452, AUG. 4, 1961

B-146452: Aug 4, 1961

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JORGE PAZ: REFERENCE IS MADE TO YOUR LETTER OF JUNE 28. YOU SAY THAT AT THE TIME YOU WERE NOT YET A NATURALIZED CITIZEN AND THAT YOU ONLY BECAME NATURALIZED IN SEPTEMBER 1946. THIS OFFICE IS REQUIRED TO WITHHOLD 18 PERCENT OF THE AMOUNT COGNIZABLE AS TAXABLE INCOME.

B-146452, AUG. 4, 1961

TO MR. JORGE PAZ:

REFERENCE IS MADE TO YOUR LETTER OF JUNE 28, 1961, QUESTIONING THE DEDUCTION OF FEDERAL INCOME TAX IN THE AMOUNT OF $80.54 FROM THE AMOUNT ALLOWED IN OUR CLAIMS DIVISION SETTLEMENT OF AUGUST 27, 1959, FOR PAY AND ALLOWANCES FOR THE PERIOD JUNE 1, 1942, TO JANUARY 20, 1945, UNDER PUBLIC LAW 85-217, APPROVED AUGUST 29, 1957. YOU SAY THAT AT THE TIME YOU WERE NOT YET A NATURALIZED CITIZEN AND THAT YOU ONLY BECAME NATURALIZED IN SEPTEMBER 1946.

SECTION 3402 (A) OF THE INTERNAL REVENUE CODE PROVIDES THAT EVERY EMPLOYER MAKING PAYMENTS OF WAGES SHALL DEDUCT AND WITHHOLD SPECIFIC AMOUNTS OR A PERCENTAGE FROM SUCH WAGES. THE DEFINITION OF THE TERM WAGES IN SECTION 3401 (A) OF SUCH CODE REQUIRES APPLICATION OF THE ABOVE PROVISIONS OF SECTION 3402 (A) TO THE REMUNERATION PAID BY THE UNITED STATES FOR SERVICES RENDERED AS A MEMBER OF THE ARMED FORCES. IN THE ABSENCE OF SPECIFIC EVIDENCE AS TO THE CLAIMANT'S TAX EXEMPTIONS, THIS OFFICE IS REQUIRED TO WITHHOLD 18 PERCENT OF THE AMOUNT COGNIZABLE AS TAXABLE INCOME.

OUR OFFICE HAS NO JURISDICTION TO CONSIDER YOUR RIGHTS UNDER THE INCOME TAX LAWS. HOWEVER, THE ACTION TAKEN BY OUR OFFICE DOES NOT PREJUDICE YOUR RIGHT TO PRESENT THE MATTER TO THE APPROPRIATE DISTRICT DIRECTOR OF INTERNAL REVENUE FOR CONSIDERATION.