Accrual of PCS Withholding Tax Allowance for PP 20

To:       GS-W AO
cc: 
Subject:  Accrual of PCS Withholding Tax Allowance for PP 20

PLEASE DISREGARD IF YOUR COST CENTER DOES NOT HAVE ANY PCS OBLIGATIONS FOR 
FY 2000.

As some of you are aware, OFM has identified a discrepancy with the 
Standard Operating Procedures of PCS Withholding Tax Allowance (mentioned 
below). Some of these charges have been hitting cost center accounts 
rather than the Bureau account. I have been working with the effected Cost 
Centers in obtaining the account information in order for OFM to move 
these charges to the Bureau account. Cost Centers will need to review 
their PP 20 444 reports to identify 
whether these charges have hit your cost center account.  If they have hit 
your account, you will need to process an 8J/8S (by COB September 29, 
2000) to move the PCS Withholding Tax Allowance charges to the Bureau 
account (6120-90000). After September 29, 2000, you must  accrue an 8A 
(and place an 8S on hold).

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I was informed today that OFM has implemented a new procedure effective 
January 1, 2000, for the treatment of PCS withholding tax allowance.  In 
the past a debit or charge would hit the cost center account and up to 2 
years later you would see the offsetting credits.  As you were well aware 
this caused large swings in the account balances during closeout.  The 
balance of the debit and credits should almost always be zero even though 
that was not always the case. 

OFM has informed me that they have written new Standard Operating 
Procedures for the calculation and reconciliation of these claims.  They 
found many internal errors creating the discrepancies and reasons for the 
debits and credits not always balancing to zero. 

The new Standard Operating Procedures include the Bureau establishing an 
account for all the debits and credits to be charged.  This means the cost 
center will no longer see these hitting their accounts. The only time a 
charge may hit is if there was a major error in the calculation or Bureau 
of Reclamation makes a payroll adjustment.

I have asked OFM to send something out to all cost centers. In the interim 
I wanted you to be aware. 

This new procedure is a result of a suggestion sent in by Scott Padgett, 
Northeast Region Office.  Thank you Scott for taking the initiative on 
this issue.  Hopefully this will eliminate the confusion throughout the 
year and especially at closeout when calculating what to accrue.

Thanks, Kelly