Do I have to show my tax return to my employer?

October 8, 2008 6:52 PM

Is it legal for my employer to ask for last year's tax return in order to verify my dependents for benefit purposes?

I got a letter today from an outside company that is verifying my dependents eligibility for benefits. They are asking for a copy of the front page of my 2007 taxes and marriage license and birth certificate for my son. I'm not comfortable with sending this to an outside firm for one, but then I'm not sure I want my employer to see my tax return anyways.
Do they have a legal right to ask for this? I know YANML, but I live in Ohio if that helps.

posted by anonymous to law & government (14 comments total)

I would start by asking them what they hope to learn from the tax return that they won't get from the marriage licence and birth certificate. (and if the answer seems reasonable, perhaps there's some other way give satisfactory evidence of whatever they're trying to establish)
posted by winston at 6:56 PM on October 8, 2008

Also, for what purpose are they verifying and what are the consequences of not co-operating? (e.g. is it part of a survey, or is it an audit of you in particular?)
posted by winston at 6:58 PM on October 8, 2008

If they insist that they need these specific forms, ask whether you can black out your financial information. Leave only the fields with your dependents' names in them unblacked. That way, you can verify that you filed taxes listing the relevant people as dependents without letting them know how much you made and what deductions you took.
posted by decathecting at 7:22 PM on October 8, 2008 [1 favorite]

I've changed jobs about 10 times in my life, working for Fortune 500 firms and 5 person start ups. I have never, ever been asked for a tax return to verify dependent eligibility for benefits. The benefits administrator / provider will have all your SS numbers on the application, it's trivial and I assume standard operating procedure for them to verify that information.
posted by COD at 7:28 PM on October 8, 2008

You got the letter from the outside company? I would first verify with your employer that it's a legitimate request and not an identity theft scam.
posted by jedicus at 7:53 PM on October 8, 2008 [7 favorites]

Smells fishy to me too. I've never been asked for a tax return to verify dependents and have worked for Fortune 100 companies that cross the T's, dot the I's, and then some. I'd ask your employer, not the outside firm, about this; they may not even be aware of the other firm's request (or they have gotten some bad advice).
posted by sfkiddo at 9:23 PM on October 8, 2008

Seconding smells like a scam - there's no legal reason for your employer to even ask to see your tax return.
posted by Arthur Dent at 10:11 PM on October 8, 2008

take the letter directly to your company's HR department and figure out what the deal is. do not pass go. do not collect 200 dollars.
posted by phredgreen at 10:15 PM on October 8, 2008 [1 favorite]

It's legal to ask, and I've been asked, but I have never complied. This is none of anyone's business.
posted by ikkyu2 at 1:58 AM on October 9, 2008

It certainly smells fishy.
That said, many employers are severely restricting benefits, sometimes limiting coverage only to the employee. This definitely could be an over-zealous benefits contractor mining data in order to restrict your benefits as much as possible.
posted by Thorzdad at 4:09 AM on October 9, 2008

I would guess that they really are hoping to learn what you *really* earned last year to make sure their offer isn't too high.

Don't comply. None of their business. You have nothing to gain from lying about your number of dependants- what are you going to do, take an imaginary kid to the hospital and then profit from the insurance? There's no reason, if fraud was your goal, you couldn't just give them a copy of an imaginary tax return.
posted by gjc at 4:19 AM on October 9, 2008

(Many years ago, my mother worked for a union health and welfare trust fund. She found several situations where cousins, nieces and nephews were "enrolled" as if they were the children of members. Money paid out for their health care wasn't available for members.)
posted by Carol Anne at 4:30 AM on October 9, 2008

Tell them no and ask if there is any other information you might provide to help them. I am not sure what the tax return is going to prove. You could write a copy right now that had no other information but the dependent information.
posted by JJ86 at 5:40 AM on October 9, 2008

If they must see this information, black-out the things that are not their business. Make a copy of the return. Black out the MYOB parts, then copy the result.

Under normal conditions, I'd challenge it. Where in your contract does it state that the benefits promised are conditioned on divulging private information? Sadly, the current state of the economy is anything but 'normal', so it is more difficult to get away with such a stand.
posted by Goofyy at 5:49 AM on October 9, 2008