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									       Tasks To Be Performed By A Government Fiscal/Employer Agent (F/EA)
     Ope rating Under Section 3504 Of The IRS Code And Revenue Procedure 80-4,
                  1980-1 C.B. 581 And IRS Proposed Notice 2003-70 1


There are a number of tasks that state or local government program agencies must
perform when operating as a Government F/EA under section 3504 of IRS code, Revenue
Procedure 80-4 and as modified by IRS Proposed Notice 2003-70. The purpose of this
document is to provide information that will assist:

       State and local government program agencies who wish to become a Government
        F/EA, develop and implement the policies, procedures and internal controls
        necessary for successfully performing the function directly or with assistance
        from a reporting agent or subagent and monitor performance; and

       Assist entities who wish to operate as a reporting agent or subagent for a
        Government F/EA or to review their current F/EA – related operations.

    Overview of the Requirements of a Government F/EA

    Historically, Government Fiscal/Employer Agents (Government F/EAs) operating
    under IRS Revenue Procedure 80-4, 1980-1 C.B. 581 had to perform all the tasks
    related to the F/EA function directly. IRS Proposed Notice 2003-70 allows
    Government F/EAs to delegate agent tasks to a reporting agent or subagent on its
    behalf in accordance with certain requirements.

    The IRS defines a reporting agent as an accounting service, franchiser, bank, 2 service
    bureau or other entity authorized to perform one or more acts on behalf of an
    employer including signing and filing Forms 940, 941 and make Federal tax deposits
    for the taxes reported on those forms (IRS Proposed Notice 2003-70).

IRS defines a reporting agent as:

An accounting service, franchiser, bank, service bureau, or other entity authorized to
perform one or more of the following functions:

       Sign and file electronically Forms 940 and 941;

1
  The information presented in this document is based on IRS documentation, discussions with IRS
Emp loy ment Tax Policies, Procedures and Guidance staff and fro m best practices identified fro m
Govern ment and Vendor F/ EAs operations. This informat ion is subject to change based on any changes
IRS policy related to F/EAs and household employers hiring domestic service workers. It should be note d
that for the purpose of this document the term “ind ividual” refers to either a p rogram participant or a
representative who is the employer of the workers he/she hires directly.
2
 In February 2005, IRS Emp loyment Tax General Counsel staff in formed Sue Flanagan that credit unions
were not considered banks under the definition of a reporting agent in IRS Notice 2003 -70.


Prepared by Susan Flanagan, Ph.D., M.P.H.           1                                            10/15/07
The Westchester Consulting Group
        Sign and file on paper Forms 945, 1042, 940 and 941-PR, 941-SS, 943, 943-PR.,
         and Form CT-1; and
        Make FTDs and FTPs and submit FTD and FTP information electronically for
         the taxes reported on the Form 720, 940, 941, 943, 945, 990-C, 990-PF, 990-T,
         1041, 1042, 1120 and Form CT-1.

    A state or local Government F/EA may only delegate agent tasks to one reporting
    agent or subagent. 3 However, a state can implement a self-directed service program
    using multiple local Government F/EAs who use a reporting agent or subagent as
    long as they file and deposit taxes for only participants located in their local
    jurisdiction. Thus, using either scenario, F/EA costs are considered an administrative
    expense for the purpose of claiming Federal matching funds.

    In addition to allowing Government F/EAs to perform agent tasks directly or to
    delegate tasks to a reporting agent or subagent, the Service, also allows a Government
    F/EA and its subagent or reporting agent to:

        Maintain copies of individuals’ FEINs and IRS notification letters;

        Not file IRS Forms SS-4 and obtain Federal Employer Identification Numbers
         (FEINs) unless a particular state requires an FEIN to file state taxes; 4

      File one Form 2678 for the program(s) the government agency acts as agent for
       and maintain individuals’ written approval for the government entity to be their
       agent (e.g. executed IRS Forms 2678 or a similar statement) on file rather than
       filing an IRS Form 2678, Agent Authorization with the IRS and receiving written
       IRS approval for each individual the agent represents;

        File and deposit FUTA in the aggregate; and

        Pay federal taxes when they are filed (e.g., FICA quarterly and FUTA annually).
         Government F/EAs or their reporting agent, if used, have this privilege, however,
         subagents must pay federal taxes in accordance with IRS depositing rules.




3
  This is because the Govern ment F/ EA’s separate FEIN and contact informat ion can only be reported on
one Form 941 and 940 per reporting period. If mu ltip le local Govern ment F/EAs are used by a state to
administer a self-directed service program, each local Govern ment F/ EA can only use one reporting agent
or subagent to perform agent tasks for the individuals in the local jurisdiction covered by the local
Govern ment F/ EA.
4
  On 11/14/04, IRS Emp loyment Tax Policies, Procedures and Guidance staff in formed Sue Flanagan that
the Service had contacted state unemploy ment tax authorities and asked them to use the FEIN for state tax
emp loyer registration nu mber purposes, however, not all agreed to do so. As of 11/14/04, the majority of
states’ departments of revenue and unemployment insurance required emp loyers to obtain a FEIN in order
to register individuals and entities as employers and to issue s tate tax account identification numbers for
state income withholding and unemploy ment tax filing and payment purposes.

Prepared by Susan Flanagan, Ph.D., M.P.H.             2                                             10/15/07
The Westchester Consulting Group
Government F/EAs that use a subagent must:

        Execute a second, IRS Form 2678, Agent/Payer Authorization, between itself and
         its subagent, requesting that the subagent be the agent to the Government F/EA.
         The Government F/EA’s separate FEIN should be reported in Part I and the
         subagent’s corporate FEIN should be report in Part II of the IRS Form 2678. In
         addition, it was recommended by IRS staff that when the Government entity
         executes the IRS Form 8821, Tax Information Authorization with each
         individual, it add the reporting or subagent it uses as a second appointee on the
         Form; 5 and

        Obtain written approval (an informed consent statement) from each individual it
         represents to use a subagent.

Government F/EAs that use a reporting agent must have an executed IRS Form 8655,
Reporting Agent Authorization between itself and the reporting agent for the filing of the
IRS Form 940 (FUTA) and 941 (federal income tax withholding and FICA) and IRS
Forms W-2 and W-3. It should be noted that in the eyes of the IRS a reporting agent is
not liable for any unfulfilled federal tax obligations including penalties and interest, and
often state taxation agencies apply the same rationale. The Government F/EA and the
individual program participant or representative-employer are liable for any unfulfilled
federal tax obligations including penalties. This is why it is important for Government
F/EAs to execute effective performance-based contacts with their reporting agent that
clearly specifies their roles and responsibilities and what they are liable for in the eyes of
the state or local government they contract with.

States need to check with their state income and unemployment tax agencies to determine
with whom any required state powers of attorney should be executed with/between (e.g.,
between the Government Agent and the individual or between the reporting agent and the
individual or both).

Preparing and Maintaining a Government F/EA Policies and Procedures Manual

If a State or local government decides to perform the Government F/EA function with or
without using a reporting or subagent, it should prepare a Government F/EA Policies and
Procedures Manual. This Manual should documents the policies, procedures and internal
controls for all Government F/EA tasks.

If the Government F/EA uses a reporting or subagent, the Manual should document the
tasks performed by the reporting or subagent and the policies, procedures and internal
controls the Government F/EA will use to receive from and transmit information to the

5
 The Govern ment F/ EA should report the reporting or subagent as a second appointee on the IRS Form
8821. IRS Emp loyment Tax Policies, Procedures and Guidance staff also suggest that reporting agents and
subagents complete the “third party designee” section of the IRS Form 940 and 941 to emphasize their
ability to commun icate with the Service.


Prepared by Susan Flanagan, Ph.D., M.P.H.          3                                            10/15/07
The Westchester Consulting Group
reporting agent or subagent and communicate with and monitor the performance of the
reporting agent or subagent. The reporting agent or subagent should prepare and submit
a Policies and Procedures Manual to the Government F/EA that describes the policies,
procedures and internal controls it will use and that are specific the tasks it will perform
and state requirements.

The Government F/EA and Reporting Agent or Subagent Policies and Procedures
Manuals should be updated at least annually and more often if necessary. Also, they
should be electronically produced, (read-only) so it is readily accessible to employees
performing Government F/EA, reporting agent and subagent agent tasks.

Staying Up-to-Date with Federal and State Tax, Labor, Immigration Workers’
Compensation and Program Requirements

The Government F/EA and its reporting agent or subagent must have policie s, procedures
and internal controls in place to stay up-to-date with federal and state tax, labor,
immigration, workers’ compensation (and mandatory disability insurance in the five
states where it is applicable) and program regulations to perform effectively as a
Government F/EA and limit any risk of liability as a result of noncompliance. For
example, Federal and state tax procedures forms and instructions can change without
prior notice. Reviewing applicable agency web sites on a monthly basis is essential for
staying up-to-date in these areas.

Obtaining a Separate FEIN for Federal Tax Filing and Payment Purposes

State or local government program agencies that wish to perform as F/EAs must obtain a
separate Federal employer identification number (FEIN) for the sole purpose of filing
certain federal employment tax forms and making federal tax payments. This FEIN
should only be used processing wages and federal forms and taxes for the individual-
employers it represents as agent and not for processing wa ges and related federal forms
and taxes for employees of parent organization or sub entity. This FEIN really acts as a
“dummy” FEIN and is obtained in addition to an F/EA organization’s corporate FEIN.
A reporting or subagent uses this separate FEIN when performing F/EA service on behalf
of a Government F/EA.

The remaining Government F/EA tasks are described in the balance of this document.
Please note that depending on the operational approach use, the Government F/EA or its
reporting agent or subagent may be performing these tasks.




Prepared by Susan Flanagan, Ph.D., M.P.H.     4                                       10/15/07
The Westchester Consulting Group
I.       Obtaining Federal And State Approval To Be A Governme nt
         Fiscal/Employer Agent (F/EA)

1. Does the Government F/EA have a separate FEIN specifically to file the IRS Form
   2678 and selected federal tax forms on individuals’ behalf? 6

2. Has the Government F/EA prepared and submitted an IRS Form 2678, Agent/Payer
   Authorization and cover letter to the IRS for all of the individuals it will represent as
   F/EA and has maintained copies of these documents in its file? 7

3. Has the Government F/EA received written authorization (IRS LTR 1997C) from the
   IRS to act as the Government F/EA for all individuals enrolled in the program and
   has it maintained this documentation in its file? 8

4. If the Government F/EA is using a subagent, has the Government F/EA prepared and
   submitted an IRS Form 2678, Agent/Payer Authorization between itself and its
   subagent requesting IRS authorization for the subagent to be the Government F/EA’s
   agent for the purpose of performing F/EA tasks delegated to it by the Government
   F/EA? 9




6
  For the purpose of this document, the term “individual” refers to the employer whether it’s the program
participant or his/her representative, as appropriate. If a program is imp lemented by local govern ment
agencies, each local government agency must obtain a separate FEIN to file and pay federal taxes on the
behalf of individuals they represent as agent.
7
  IRS Rev. Proc. 80-4 states that in cases where services are provided under a state-wide uniform program,
the state may file one IRS Form 2678 and application to act as the Govern ment F/ EA for s ervice recipients
in the particular publicly-funded program. In the cover letter that accompanies the Govern ment F/ EA’s
completed IRS Fo rm 2678, the Govern ment F/ EA should refer to the fact that it has executed and maintains
on file an IRS Form 2678 with each individual it represents as agent (and if it uses a subagent that it has an
informed consent statement executed with and maintained in each individual’s file and that its executed an
IRS Form 2678 between itself and the subagent it will use – could enclose in this mailing). If the
Govern ment F/ EA uses a subagent, it should execute an IRS Form 2678 between itself and the subagent
(making the subagent the Govern ment F/ EA’s agent) and obtain and execute and maintain an informed
consent statement from each indiv idual stating that the individual knows of and consents to the
Govern ment F/ EA’s use of a subagent. In cases in which numerous state program agencies imp lement their
own self-directed service program or a state self-directed service program is imp lemented by mu ltiple local
government agencies, each applicable state or local government program agency that desires to act as a
Govern ment F/ EA should file an application and receive IRS approval.
8
  This would be one IRS approval letter (IRS LTR 1997C) for each applicable Govern ment F/ EA for all o f
the individuals it represents as agent, not one for each individual en rolled such as in the case of a Vendor
F/EA. It should be noted that liability is not fixed on the Government F/ EA until the effective date on the
IRS authorization letter. However, it should be made clear to indiv iduals that state and local government
agents, and their subagents will assume any liability for unfulfilled federal tax obligations, including
penalties and interest, during the period of time between when the indiv idual begins to receive F/ EA
services and the receipt of IRS agent authorization.
9
  IRS Proposed Notice 2003-70 Q&A 25 states this requirement. The Govern ment F/ EA’s in formation and
its separate FEIN should be reported in Part 1, o f the Form. The subagent’s information and corporate
FEIN should be reported in Part 2 of the Form.

Prepared by Susan Flanagan, Ph.D., M.P.H.             5                                              10/15/07
The Westchester Consulting Group
 5. Has the subagent or Government F/EA received written authorization (IRS LTR
    1997C) from the IRS for the subagent to act as the agent for the Government F/EA? 10

 6. Does the Government F/EA, or its reporting or subagent, have a system in place for
    obtaining a federal employer identification number (FEIN) for each individual it
    represents (as required) and for maintaining copies of the individual’s FEIN, the IRS
    FEIN notification letter and the filed Form SS-4, Request for FEIN in the individual’s
    file?

 7. Does the Government F/EA, or its reporting or subagent, have written policies and
    procedures for obtaining a federal employer identification number for each individual
    it represents (as required) and for maintaining copies of the individual’s FEIN, the
    IRS FEIN notification letter and the filed Form SS-4, Request for FEIN in the
    individual’s file?

 8. Does the Government F/EA, or its reporting or subagent, have a system in place for
    retiring individuals’ FEINs when they are no longer employer, permanently, and
    maintaining the relevant documentation in individuals’ files? 11

 9. Does the Government F/EA, or its reporting or subagent, have written policies and
    procedures for retiring individuals’ FEINs when they are no longer employers and
    maintaining the relevant documentation in individuals’ files?

10. Does the Government F/EA, or its reporting or subagent, have internal controls
    documented and in place to monitor its FEIN process, including the receipt and
    retirement of individuals’ FEINs and the relevant documentation is maintained in
    each individual’s file?

11. Does the Government F/EA have a system in place for obtaining a signed IRS Form
    2678: Agent/Payer Authorization from each individual it represents and maintaining
    copies of these forms in each individual’s file?

12. Does the Government F/EA have written policies and procedures for obtaining a
    signed IRS Form 2678: Agent/Payer Authorization from each individual it represents
    and maintaining copies of these forms in each individual’s file?

13. Does the Government F/EA have a system in place for revoking the IRS Form 2678,
    Agent/Payer Authorization for each individual (internally in each individual’s file) it
    no longer represents and for maintaining the relevant documentation in each
    individual’s file?




 10
  Requirement reporting in Q&A #25 in IRS Proposed Notice 2003 -70.
 11
  The indiv idual’s FEIN should not be retired until all federal and state tax filings and deposits and Forms
 W-2 have been processed.

 Prepared by Susan Flanagan, Ph.D., M.P.H.             6                                             10/15/07
 The Westchester Consulting Group
14. Does the Government F/EA have written policies and procedures for revoking the
    IRS Form 2678, Agent/Payer Authorization for each individual (internally in each
    individual’s file) when the Agent no longer represents the individual and for
    maintaining the relevant documentation in each individual’s file?

15. Does the Government F/EA have internal controls documented and in place to
    monitor the IRS Form 2678, Agent/Payer Authorization execution and revocation
    process for all individuals it represents?

16. If a Government F/EA uses a subagent, does the Government F/EA have a system in
    place for executing an informed consent statement from individuals it represents to
    use a subagent and maintaining the signed statement in each individual’s file? 12

17. Does the Government F/EA have written policies and procedures for obtaining
    written for executing an informed consent statement from individuals it represents to
    use a subagent and the signed statement in each individual’s file?

18. Does the Government F/EA have an internal control documented and in place to
    monitor the receipt of informed consent statements from individuals it represents to
    use a subagent and maintaining the statements in each individual’s file?

19. Does the Government F/EA have a system in place for executing an IRS Form 8821,
    Tax Information Authorization with each individual it represent and for maintaining
    the relevant documentation in each individual’s file? 13

20. Does the Government F/EA have written policies and procedures for executing and
    IRS Form 8821, Tax Information Authorization with each individual it represent and
    maintaining the relevant documentation in each individual’s file?

21. Does the Government F/EA have a system for renewing an IRS Form 8821, Tax
    Information Authorization with each individual they represent per IRS instructions
    and for maintaining the relevant documentation in each individual’s file?

22. Does the Government F/EA have written policies and procedures for renewing an
    IRS Form 8821, Tax Information Authorization with each individual they represent
    and maintaining the relevant documentation in each individual’s file?

23. Does the Government F/EA have a system for revoking an IRS Form 8821, Tax
    Information Authorization with each individual they represent per IRS instructions
    and for maintaining the relevant documentation in each individual’s file?



 12
    The requirement is described in IRS Proposed Notice 2003-70, Q&A #25.
 13
    IRS Form 8821 allows for more than one appointee to be named on the Form. A Govern ment F/ EA
 using a reporting agent or subagent should list this entity as a second appointee on the IRS Form 8821 so it
 also can communicate with the IRS on inco me tax withholding and emp loyment tax filing and payment.

 Prepared by Susan Flanagan, Ph.D., M.P.H.             7                                             10/15/07
 The Westchester Consulting Group
24. Does the Government F/EA have written policies and procedures for revoking an
    IRS Form 8821, Tax Information Authorization with each individual they represent
    and maintaining the relevant documentation in each individual’s file?

25. Does the Government F/EA have an internal control documented and in place to
    monitor the execution, renewal and revocation of IRS Forms 8821, Tax Information
    Authorization with each individual it represents per IRS instructions and maintaining
    the relevant documentation in each individual’s file?

26. If the Government F/EA is using a reporting agent, does the Government F/EA have a
    system in place for executing an IRS Form 8655, Reporting Agent Authorization
    between itself and the reporting agent for the purpose of filing IRS Forms 940, 941
    and W-2/W-3 and depositing any associated tax payments?

27. If the Government F/EA is using a reporting agent, does the Government F/EA have a
    written policy and procedure for executing an IRS Form 8655, Reporting Agent
    Authorization between itself and the reporting agent for the purpose of filing IRS
    Forms 940, 941 and W-2/W-2 and paying any associated tax payments?

28. If the Government F/EA is using a reporting agent, does the Government F/EA have
    internal controls documented for monitoring the process for executing an IRS Form
    8655, Reporting Agent Authorization between itself and the reporting agent for the
    purpose of filing IRS Forms 940, 941 and W-2 and paying any associated tax
    payments?

29. Does the Government F/EA have a system in place for obtaining state powers of
    attorney (state income tax, unemployment or both) from each individual it represents,
    if required by the state, and for maintaining the relevant documentation in each
    individual’s file? 14

30. Does the Government F/EA have written policies and procedures for obtaining state
    powers of attorney for each individual it represents, if required by the state, and
    maintaining the relevant documentation in each individual’s file?

31. Does the Government F/EA have a system in place to revoke state powers of attorney
    (state income tax, unemployment or both) for each individual it represents, if required
    by the state and maintain the relevant documentation in each individual’s file?

32. Does the Government F/EA have written policies and procedures for revoking state
    powers of attorney (state income tax, unemployment or both) for each individual it
    represents, if required by the state and maintain the relevant documentation in each
    individual’s file?

 14
    If the Govern ment F/EA uses a reporting agent or subagent, it should have a dis cussion with the relevant
 state tax agency staff (i.e., income and unemploy ment tax) regarding who should hold the required state
 power of attorney, the Govern ment F/EA, or the reporting agent or subagent or both.


 Prepared by Susan Flanagan, Ph.D., M.P.H.             8                                             10/15/07
 The Westchester Consulting Group
33. Does the Government F/EA have internal controls documented and in place to
    monitor the receipt and revocation of state powers of attorney for each individual it
    represents, if required by the state, and maintaining the relevant documentation in
    each individual’s file?

34. Does the Government F/EA, or its reporting agent or subagent, have a system in place
    for executing Medicaid provider agreements with individuals’ workers and for
    maintaining these agreements in each worker’s file? 15

35. Does the Government F/EA, or its reporting agent or subagent, have written policies
    and procedures for executing Medicaid provider agreements with individuals’
    workers and for maintaining these agreements in each worker’s file?

36. Does the Government F/EA or its reporting agent or subagent have internal controls
    documented for monitoring the execution and maintenance of workers’ Medicaid
    provider agreements?


 II.      Preparing and Distributing Individual Enrollment and Worker Employment
          Packets

       Individual Enrollment Packets

1.     Has the Government F/EA or its reporting agent or subagent developed an individual
       enrollment packet that includes all required information, forms and instructions and
       that has been approved by the state self-directed program agency?

2.     Does the Government F/EA or its reporting agent or subagent have a system in place
       for producing and distributing individual enrollment packets?

3.     Does the Government F/EA or its reporting agent or subagent have written policies
       and procedures for producing and distributing individual enrollment packets?

4.     Does the Government F/EA or its reporting agent or subagent have internal controls
       documented and in place to monitor the production and distribution of individual
       enrollment packets?

5.     Does the Government F/EA, or its reporting or subage nt, as applicable, have a system
       in place for collecting and processing all required forms and information contained in
       the individual enrollment packet (See Section II below)?
 15
    Medicaid state plan and HCBS section 1915 (c) waiver programs require that Medicaid provider
 agreements be executed with each worker hired d irectly by an individual program participant or his
 representative. Govern ment F/ EAs can delegate the Medicaid provider agreement execution and
 maintenance tasks to a reporting agent or subagent. However, the Govern ment F/ EA must execute an
 agreement (i.e., Memo randum of Understanding) between itself and its reporting agent or subagent
 describing the tasks delegate. The State also must include a description of the delegation of these tasks in
 its Medicaid HCBS section 1915(c) waiver as an amend ment.

 Prepared by Susan Flanagan, Ph.D., M.P.H.             9                                              10/15/07
 The Westchester Consulting Group
6.      Does the Government F/EA, or its reporting or subagent, as applicable, have written
        policies and procedures for collecting and processing all required forms and
        information contained in the individual enrollment packet?

7.      Does the Government F/EA, or its reporting or subagent, as applicable, have internal
        controls documented and in place to monitor the collection and processing of all
        required forms and information contained in the individual enrollment packet?

        Worker Employment Packets

 1. Has the Government F/EA, or its subagent or reporting agent, developed an
    employment packet for individuals’ workers that contain all the required information,
    forms, instructions, Medicaid provider and other agreements and informed consent
    documents needed to enroll them as individuals’ employees (e.g., employment
    application, IRS Form W-4, state version of the Form W-4, if applicable, state new
    hire form, US CIS Form I-9, IRS Notice 797)?

 2. Has the Government F/EA or its subagent or reporting agent, have a system in place
    for producing and distributing employment packets for individuals’ workers?

 3. Has the Government F/EA or its subagent or reporting agent, have written policies
    and procedures for producing distributing employment packets for individuals’
    workers?

 4. Has the Government F/EA or its subagent or reporting agent, have internal co ntrols
    documented to monitor the production and distribution of employment packets for
    individuals’ workers?

 5. Does the Government F/EA, or its subagent or reporting agent, have a system in place
    for collecting, processing and maintaining the required documentation included in the
    employment packets? 16

 6. Does the Government F/EA, or its subagent or reporting agent, have written policies
    and procedures for collecting, processing and maintaining the required human
    resources documentation included in the employment packet?

 7. Does the Government F/EA, or its subagent or reporting agent, have internal controls
    documented to monitor the collection, processing and maintenance of the required
    human resources documentation included in the employment packet?




 16
      Section IV, # 1-21 further describe the human resource related tasks.

 Prepared by Susan Flanagan, Ph.D., M.P.H.              10                            10/15/07
 The Westchester Consulting Group
III.       Management of Individuals’ Budget Funds

1. Does the Government F/EA, or its subagent or reporting agent, have the information
   system in place for receiving and maintaining initial and upda ted individual service
   plans, budgets and service authorizations?

2. Is the subagent or reporting agent a Medicaid enrolled provider, if applicable?

3. Does the Government F/EA, or its subagent or reporting agent, have the information
   system in place for billing the State’s Medicaid Management Information System or
   other designated entity?

4. Does the Government F/EA, or its subagent or reporting agent, have the information
   system in place to receive and disburse individuals’ Medicaid budget funds and track
   budget funds received, disbursed and any remaining balances for each individual
   individually and in the aggregate?

5. Does the Government F/EA, or its subagent or reporting agent, have written policies
   and procedures for receiving and disbursing individuals’ Medicaid budget funds and
   tracking individuals’ budget funds received, disbursed and any remaining balances
   for each individual and in the aggregate?

6. Does the Government F/EA, or its subagent or reporting agent, have internal controls
   in place to monitor the receipt and disbursement of budget funds and any remaining
   balances for each individual? 17


IV.        Payroll Process

1. Does the Government F/EA, or its subagent or reporting agent, have a system in place
   for processing an IRS Form W-4 from each worker the Government F/EA, reporting
   agent or subagent processes payroll for and for maintaining the form in each worker’s
   file?

2. Does the Government F/EA, or its subagent or reporting agent, have written policies
   and procedures for processing an IRS Form W-4 from each worker the Government
   F/EA, reporting agent or subagent processes payroll for and for maintaining the form
   in each worker’s file?

3. Does the Government F/EA, or its subagent or reporting agent, have internal controls
   documented and in place to monitor the processing IRS Forms W-4 for each worker
   the Government F/EA, reporting agent or subagent performs payroll and for
   maintaining a copy of the form in each worker’s file?



17
     An important internal control for this task is segregation of duties.

Prepared by Susan Flanagan, Ph.D., M.P.H.                11                          10/15/07
The Westchester Consulting Group
 4. Does the Government F/EA, or its subagent or reporting agent, have a system in place
    for processing an IRS Form W-5 from each worker the Government F/EA, reporting
    agent or subagent processes advanced EIC for and for maintaining a copy of the form
    in each worker’s file? 18

 5. Does the Government F/EA, or its subagent or reporting agent, have written policies
    and procedures for processing an IRS Form W-5 from each worker the Government
    F/EA, reporting agent, or subagent processes advanced EIC for and for maintaining a
    copy of the form in each worker’s file?

 6. Does the Government F/EA, or its subagent or reporting agent, have internal controls
    documented to monitor the processing of an IRS Form W-5 for each worker the
    Government F/EA’s, reporting agent’s or subagent’s files and for maintaining a copy
    of the form in each worker’s file?

 7. Does the Government F/EA, or its subagent or reporting agent have a system in place
    for processing a completed and signed state version of the Form W-4, when
    applicable, from each individual it represents and for maintaining a copy of the form
    in each worker’s file?

 8. Does the Government F/EA, or its subagent or reporting agent have a written policy
    and procedure for processing a completed and signed state version of the Form W-4,
    when applicable, from each individual it represents and for maintaining a copy of the
    form in each worker’s file?

 9. Does the Government F/EA, or its subagent or reporting agent have an internal
    control documented and in place to monitor the processing completed and signed
    state version of the Form W-4, when applicable, from each individual it represents
    and for maintaining a copy of the form in each worker’s file?

10. Does the Government F/EA, or its subagent or reporting agent, have a system in place
    for verifying worker’s citizenship and alien status by collecting a completed US CIS
    Form I-9 from every worker it processes payroll for and maintaining the Form in each
    worker’s file? 19

11. Does the Government F/EA, or its subagent or reporting agent, have written policies
    and procedures for verifying workers’ citizenship and alien status and for collecting a
    completed US CIS Form I-9 from each worker it processes payroll for maintain the
    Form in each worker’s file?


 18
    It is suggested that Govern ment F/ EAs consider including IRS Notice 797 that exp lains what advanced
 earned income credit is, in the F/EA emp loyee packets and write at the bottom of the Notice, “If you are
 elig ible, please call _____ and request that an IRS Form W -5 be sent to you. Once you receive the Form
 complete it and return it to _________.”
 19
    It is suggested that if a Govern ment F/EA maintains copies of workers’ identification info rmation on file,
 the Govern ment F/ EA or reporting or subagent, as applicable should obtain written permission from the
 workers’ to do so.

 Prepared by Susan Flanagan, Ph.D., M.P.H.             12                                              10/15/07
 The Westchester Consulting Group
12. Does the Government F/EA, or its subagent or reporting agent, have an internal
    control documented and in place to monitor the processing of US CIS Forms I-9 and
    maintaining a copy in each worker’s file?

13. Does the Government F/EA, or its subagent or reporting agent, have a system in place
    to process criminal background checks on prospective workers, notifying the state of
    the results and for maintaining copies of the documentation in the workers’ files as
    required by the state?

14. Does the Government F/EA, or its subagent or reporting agent, have written policies
    and procedures for processing criminal background checks on prospective workers,
    notifying the state of the results and for maintaining copies of the documentation in
    the workers’ files as required by the state?

15. Does the Government F/EA, or its subagent or reporting agent, have an internal
    control documented and in place to monitor the processing of criminal background
    checks on prospective workers, notifying the state of the results and for maintaining
    copies of the documentation in the workers’ file as required by the state?

16. Does the Government F/EA, or its subagent or reporting agent, have a system in place
    for verifying each worker’ social security number and for maintaining the appropriate
    documentation in each worker’s file?

17. Does the Government F/EA, or its subagent or reporting agent, have written policies
    and procedures for verifying each worker’s social security number and for
    maintaining the appropriate documentation in each worker’s file?

18. Does the Government F/EA, or its subagent or reporting agent, have internal controls
    documented and in place to monitor the verification of each worker’s social security
    number and for maintaining the appropriate documentation in each worker’s file?

19. Does the Government F/EA have a system in place for verifying the state of residence
    for each individual worker and for maintain the appropriate documentation in each
    worker’s file?

20. Does the Government F/EA have written policies and procedures for verifying the
    state of residence for each individual worker and for maintain the appropriate
    documentation in each worker’s file?

21. Does the Government F/EA internal controls documented and in place to monitor the
    verification of the state of residence for each individual worker and for maintain the
    appropriate documentation in each worker’s file?

22. Does the Government F/EA, or its subagent or reporting agent, have system in place
    for paying workers’ wages in compliance with federal and state Department of Labor
    wage and hour rules for regular and overtime pay?


 Prepared by Susan Flanagan, Ph.D., M.P.H.   13                                     10/15/07
 The Westchester Consulting Group
23. Does the Government F/EA, or its subagent or reporting agent, have written policies
    and procedures for paying workers’ wages in compliance with federal and state
    Department of Labor wage and hour rules for regular and overtime pay?

24. Does the Government F/EA, or its subagent or reporting agent, have an internal
    control to monitor the payment of workers’ wages in compliance with federal and
    state Department of Labor wage and hour rules for regular and overtime pay?

25. Does the Government F/EA, or its subagent or reporting agent, have a system in place
    to report new hires per state requirements?

26. Does the Government F/EA, or its subagent or reporting agent, have written policies
    and procedures for reporting new hires per state requirements?

27. Does the Government F/EA, or its subagent or reporting agent, have an internal
    control documented and in place to monitor the reporting of new hires per state
    requirements?

28. Has the Government F/EA, or its subagent or reporting agent, designed and produced
    a timesheet for workers?

29. Does the Government F/EA, or its subagent or reporting agent, have a system in place
    for distributing, collecting, verifying and processing workers’ timesheets?

30. Does the Government F/EA or its subagent or reporting agent, have written policies
    and procedures for distributing, collecting verifying and processing workers’
    timesheets?

31. Does the Government F/EA, or its subagent or reporting agent, have an internal
    control documented and in place to monitor the distribution, collection, verification
    and processing of workers’ timesheets?

32. Does the Government F/EA, or its subagent or reporting agent, have a system in place
    for developing and maintaining a database that is effective in tracking and responding
    to occurrences of time sheet over billing and timesheets that can not be paid due to
    missing or erroneous information?

33. Does the Government F/EA, or its subagent or reporting agent, have written policies
    and procedures for developing and maintaining a database that is effective in tracking
    and responding to occurrences of time sheet over billing and timesheets that can not
    be paid due to missing or erroneous information?

34. Does the Government F/EA, or its subagent or reporting agent, have internal controls
    to monitor the development and maintenance of a database that is effective in
    tracking and responding to occurrences of time sheet over billing and timesheets that
    can not be paid due to missing or erroneous information?


 Prepared by Susan Flanagan, Ph.D., M.P.H.   14                                     10/15/07
 The Westchester Consulting Group
35. Does the Government F/EA, or its reporting agent or subagent, have a system in p lace
    for determining if the individuals’ workers are family members who might be exempt
    from FICA, FUTA and SUTA and for processing them accordingly? 20

36. Does the Government F/EA, or its reporting agent or subagent, have written policies
    and procedures for determining if the individuals’ workers are family members who
    might be exempt from FICA, FUTA and SUTA and for processing them accordingly?

37. Does the Government F/EA, or its reporting agent or subagent, have internal
    documented and in place to monitor the identification and processing of family
    members who are paid workers who might be exempt from FICA, FUTA and SUTA?

38. Does the Government F/EA, or its subagent or reporting agent, have a system in place
    for withholding federal income tax withholding for all individuals it represents and
    for maintaining copies in the Government F/EA, subagent or reporting agent’s files?

39. Does the Government F/EA, or its subagent or reporting agent, have written policies
    and procedures for withholding federal income tax withholding for all individuals it
    represents and contact information, and for maintaining copies in the Government
    F/EA, subagent or reporting agent’s files?

40. Does the Government F/EA, or its subagent or reporting agent, have a internal
    control documented and in place to monitor the withholding of federal income taxes
    for all individuals it represents and for maintaining copies in the Government F/EA,
    subagent or reporting agent’s files?

41. Does the Government F/EA, or its subagent or reporting agent, have a system in place
    for filing federal income tax withholding using the IRS Form 941, Employer’s
    Quarterly Federal Tax Return quarterly in the aggregate for all individuals it
    represents, using the Government F/EA’s separate FEIN and contact information, and
    for maintaining copies in the Government F/EA, subagent or reporting agent’s files?

42. Does the Government F/EA, or its subagent or reporting agent, have written policies
    and procedures for filing federal income tax withholding using the IRS Form 941
    quarterly in the aggregate for all individuals it represents, using the Government
    F/EA’s separate FEIN and contact information, and for maintaining copies in the
    Government F/EA, subagent or reporting agent’s files?

43. Does the Government F/EA, or its subagent or reporting agent, have a internal control
    documented and in place to monitor the filing of federal income tax withholding
    using the IRS Form 941, Employer’s Quarterly Federal Tax Return quarterly in the
    aggregate for all individuals it represents, using the Government F/EA’s separate
    FEIN and contact information, and for maintaining copies in the Government F/EA,
    subagent or reporting agent’s files?

 20
   See IRS Publication 15, Circular E, Emp loyer’s Tax Gu ide, Chapter 3, “Family Emp loyees” and check
 with State SUTA agency for how these and any additional family exemptions apply.

 Prepared by Susan Flanagan, Ph.D., M.P.H.         15                                           10/15/07
 The Westchester Consulting Group
44. Does the Government F/EA, or its subagent or reporting agent, have a system in place
    for withholding and filing federal Medicare and social security taxes (FICA) using the
    IRS Form 941, Employer’s Quarterly Federal Tax Return quarterly in the aggregate
    for all individuals it represents, using the Government F/EA’s separate FEIN and
    contact information, and for maintaining copies in the Government F/EA, subagent or
    reporting agent’s files?

45. Does the Government F/EA, or its subagent or reporting agent, have written policies
    and procedures for filing federal Medicare and social security taxes (FICA) using the
    IRS Form 941, Employer’s Quarterly Federal Tax Return quarterly in the aggregate
    for all individuals it represents, using the Government F/EA’s separate FEIN and
    contact information, and for maintaining copies in the Government F/EA, subagent or
    reporting agent’s files?

46. Does the Government F/EA, or its subagent or reporting agent, have a internal control
    documented and in place to monitor the filing of federal Medicare and social security
    taxes (FICA) using the IRS Form 941, Employer’s Quarterly Federal Tax Return
    quarterly in the aggregate for all individuals it represents, using the Government
    F/EA’s separate FEIN and contact information, and for maintaining copies in the
    Government F/EA, subagent or reporting agent’s files?

47. Does the Government F/EA, or reporting agent, have a system in place for depositing
    FICA and federal income tax withholding in the aggregate for all individuals, using
    the Government F/EA’s separate FEIN and contact information, when the taxes are
    filed with the IRS and for maintaining relevant documentation in the Government
    F/EA’s or reporting agent’s files?

48. Does the Government F/EA, or reporting agent, have written policies and procedures
    for depositing FICA and federal income tax withholding in the aggregate for all
    individuals, using the Government F/EA’s separate FEIN and contact information,
    when the taxes are filed with the IRS and for maintaining relevant documentation in
    the Government F/EA’s and reporting agent’s file?

49. Does the Government F/EA, or its reporting agent, have internal controls documented
    and in place to monitor the depositing of FICA and federal income tax withholding in
    the aggregate for all individuals, using the Government F/EA’s separate FEIN and
    contact information, when the taxes are filed with the IRS and the maintenance of
    relevant documentation in the Government F/EA’s or reporting agent’s file?

50. Does the Government F/EA’s subagent have a system in place for depositing FICA
    and federal income tax withholding in the aggregate, using the Government F/EA’s
    separate FEIN and contact information, for all individuals in accordance with the IRS
    depositing rules and to maintain relevant documentation in the subagent’s files?




 Prepared by Susan Flanagan, Ph.D., M.P.H.   16                                   10/15/07
 The Westchester Consulting Group
51. Does the Government F/EA’s subagent have written policies and procedures for
    depositing FICA and federal income tax withholding in the aggregate for all
    individuals, using the Government F/EA’s separate FEIN and contact information, in
    accordance with the IRS depositing rules and for maintaining relevant documentation
    in the subagent’s files?

52. Does the Government F/EA’s subagent have an internal control documented and in
    place to monitor the depositing of FICA and federal income tax withholding in the
    aggregate for all individuals, using the Government F/EA’s separate FEIN and
    contact information, in accordance with the IRS depositing rules and the maintenance
    of relevant documentation in the subagent’s files?

53. Does the Government F/EA, or its reporting or subagent, have a system in place for
    withholding and filing FUTA in the aggregate for all individuals using the IRS Form
    940, Employer’s Annual Federal Unemployment Tax (FUTA) Return and the
    Government F/EA’s separate FEIN and contact information, and for maintaining
    relevant documentation in the Government F/EA’s, reporting agent’s or subagent’s
    files?

54. Does the Government F/EA, or its reporting agent or subagent, have written policies
    and procedures for withholding and filing FUTA in the aggregate for all individuals,
    using the IRS Form 940, Employer’s Annual Federal Unemployment Tax (FUTA)
    Return and the Government F/EA’s separate FEIN and contact information, and for
    maintaining relevant documentation in the Government F/EA’s, subagent’s, or
    reporting agent’s files?

55. Does the Government F/EA, or its reporting agent or subagent, have internal controls
    documented and in place to monitor the withholding and filing of FUTA in the
    aggregate for all individuals using the IRS Form 940, Employer’s Annual Federal
    Unemployment Tax (FUTA) Return and Government F/EA’s separate FEIN and the
    maintenance of relevant documentation in the Government F/EA’s, subagent’s or
    reporting agent’s files?

56. Does the Government F/EA, or its reporting agent, have a system in place for
    depositing FUTA in the aggregate for all individuals, using the Government F/EA’s
    separate FEIN and contact information, when FUTA (IRS Form 940) is filed annually
    and maintaining the relevant documentation in the Government F/EA’s, or reporting
    agent’s files?

57. Does the Government F/EA, or its reporting agent, written policies and procedures for
    paying FUTA in the aggregate for all individuals, using the Government F/EAs
    separate FEIN and contact information, when FUTA (IRS Form 940) is filed annually
    and for maintaining the relevant documentation in the Government F/EA’ or
    reporting agent’s files?




 Prepared by Susan Flanagan, Ph.D., M.P.H.   17                                   10/15/07
 The Westchester Consulting Group
58. Does the Government F/EA, or its reporting agent, have internal controls documented
    and in place to monitor the payment of FUTA in the aggregate for all individuals,
    using the Government F/EA’s separate FEIN and contact information, when FUTA
    (IRS Form 940) is filed annually and the maintenance of the relevant documentation
    in the Government F/EA’s, reporting agent’s files?

59. Does the Government F/EA’s subagent have a system in place for depositing FUTA
    in the aggregate for all individuals using the Government F/EA’s separate FEIN and
    contact information, in accordance with IRS’s depositing rules and for maintaining
    the relevant documentation in the subagent’s files?

60. Does the Government F/EA’s subagent have written policies and procedures for
    depositing FUTA in the aggregate for all individuals, using the Government F/EA’s
    separate FEIN and contact information, in accordance with IRS’ depositing rules and
    for maintaining the relevant documentation in the subagent’s files?

61. Does the Government F/EA’s subagent have an internal control documented and in
    place to monitor the depositing of FUTA in the aggregate for all individuals, using
    the Government F/EA’s separate FEIN and contact information, in accordance with
    IRS’ depositing rules and the maintenance of the relevant documentation in the
    F/EA’s subagent’s files?

62. Does the Government F/EA, or its reporting agent or subagent have a system in place
    to manage Federal Advanced Earned Income Credit (EIC) for each eligible worker in
    an accurate and timely manner and to maintain the relevant documentation in the
    worker’s file?

63. Does the Government F/EA, or its reporting agent or subagent, have written policies
    and procedures for managing Federal Advanced EIC for each eligible worker in an
    accurate and timely manner and maintaining the relevant documentation in the
    worker’s file?

64. Does the Government F/EA, or its reporting agent or subagent, have an internal
    control documented and in place to monitor the managing of Federal Advanced EIC
    for each eligible worker in an accurate and timely manner and maintaining the
    relevant documentation in each worker’s files?

65. Does the Government F/EA, or its reporting agent or subagent, have a system in place
    for registering the individual as an employer and obtaining a state employer
    registration number for state income tax filing and payment purposes for all
    individuals’ it represents and maintaining the relevant documentation in each
    individual’s file?




 Prepared by Susan Flanagan, Ph.D., M.P.H.   18                                   10/15/07
 The Westchester Consulting Group
66. Does the Government F/EA, or its reporting agent or subagent, have written policies
    and procedures for registering the individual/representative as an employer and
    obtaining a state employer registration number for state income tax filing and
    payment and maintaining the relevant documentation in each individual’s file?

67. Does the Government F/EA, or its reporting agent or subagent, have internal controls
    documented and in place to monitor the state income tax employer registration and
    registration number process and the maintenance of relevant documentation in
    individual’s file?

68. Does the Government F/EA, or its reporting agent or subagent, have a system in place
    for retiring a individual’s state income tax registration number when the individual is
    no longer the common law employer (permanently) of workers and maintaining the
    relevant documentation in each individual’s file?

69. Does the Government F/EA, or its reporting agent or subagent, have written policies
    and procedures for retiring a individual’s state income tax registration number when
    the individual is no longer the common law employer (permanently) of workers and
    maintaining the relevant document in each individual’s file?

70. Does the Government F/EA, or its reporting agent or subagent, have internal controls
    documented and in place for monitoring the retirement of the individual’s state
    income tax registration number when the individual is no longer the common law
    employer (permanently) of workers and the maintenance of relevant documentation in
    each individual’s file?

71. Does the Government F/EA, or its reporting agent or subagent, have a system in place
    for registering the individual as an employer and obtaining his/her emplo yer
    registration numbers for state unemployment tax filing and payment purposes and
    maintaining the relevant documentation in each individual’s file? 21

72. Does the Government F/EA, or its reporting agent or subagent, have written polices
    and procedures for registering the individual as an employer and obtaining his/her
    employer registration numbers for state unemployment tax filing and payment
    purposes and maintaining the relevant documentation in each individual’s file?

73. Does the Government F/EA, or its reporting agent or subagent, have internal controls
    documented and in place to monitor the employer registration process for state
    unemployment tax filing and payment and the maintenance of relevant documentation
    in each individual’s file?



 21
    Five states (Califo rnia, Hawaii, New Jersey, New Yo rk and Rhode Island) have mandatory disability
 insurance coverage for workers. The tasks associated with this type of insurance along with the written
 policies and procedures and internal controls would have to be addressed by the F/EA in the applicable
 states.

 Prepared by Susan Flanagan, Ph.D., M.P.H.           19                                             10/15/07
 The Westchester Consulting Group
74. Does the Government F/EA, or its reporting agent or subagent, have a system in place
    for retiring an individual’s state unemployment tax registration number when the
    individual is no longer the common law employer (permanently) of workers and
    maintaining the relevant documentation in each individual’s file?

75. Does the Government F/EA, or its reporting agent or subagent, have written policies
    and procedures for retiring a individual’s state unemployment tax registration number
    when the individual is no longer the common law employer (permanently) of workers
    and maintaining the relevant documentation in each individual’s file ?

76. Does the Government F/EA, or its reporting agent or subagent, have interna l controls
    documented and in place for monitoring the retirement of an individual’s state
    unemployment tax registration number when the individual is no longer the common
    law employer (permanently) of workers and the maintenance of relevant
    documentation in each individual’s file?

77. Does the Government F/EA, or its reporting agent or subagent, have a system in place
    for withholding state income taxes for all workers per state requirements and for
    maintaining the relevant documentation in the Government F/EA’s, reporting agent’s
    or subagent’s files?

78. Does the Government F/EA, or its reporting agent or subagent, have written policies
    and procedures for withholding state income taxes for each individual-employer per
    state requirements and for maintaining the relevant documentation in the Government
    F/EA’s, reporting agent’s or subagent’s files?

79. Does the Government F/EA, or its reporting agent or subagent, have internal controls
    documented and in place to monitor the withholding of state income ta xes for each
    individual-employer per state requirements and the maintaining of relevant
    documents in the Government F/EA’s, reporting agent’s or subagent’s files?

80. Does the Government F/EA, or its reporting agent or subagent, have a system in place
    for filing state income tax withholding for all workers per state requirements and for
    maintaining the relevant documentation in the Government F/EA’s, reporting agent’s
    or subagent’s files? 22

81. Does the Government F/EA, or its reporting agent or subagent, have written policies
    and procedures for filing state income tax withholding for each individual-employer
    per state requirements and for maintaining the relevant documentation in the
    Government F/EA’s, reporting agent’s or subagent’s files?


 22
   This includes preparing the final filing of state income taxes for the individual indicating that it will be
 the last filing for the individual. The p rocess for this should be confirmed with the State’s Department of
 Revenue. Also some state Departments of Revenue are allo wing agents to file and pay state income tax
 withholding for indiv iduals in the aggregate. Agents should check with a state’s Department of Revenue to
 determine if this option is allowed.

 Prepared by Susan Flanagan, Ph.D., M.P.H.             20                                             10/15/07
 The Westchester Consulting Group
82. Does the Government F/EA, or its reporting agent or subagent, have internal controls
    documented and in place to monitor the filing of state income tax withholding for
    each individual-employer per state requirements and the maintaining of relevant
    documents in the Government F/EA’s, reporting agent’s or subagent’s files?

83. Does the Government F/EA, or its reporting agent or subagent, a system in place for
    depositing state income tax withholding for each worker per state payment schedule
    and for maintaining the relevant documentation in the Government F/EA’s, reporting
    agent’s or subagent’s files? 23

84. Does the Government F/EA, or its reporting agent or subagent, have written policies
    and procedures for depositing state income tax withholding for each worker per state
    payment requirements and for maintaining the relevant documentation in Government
    F/EA’s, reporting agent’s or subagent’s files?

85. Does the Government F/EA, or its reporting agent or subagent, have internal controls
    documented and in place to monitor the depositing of state income tax withholding
    for each worker per state payment requirements and the maintenance of relevant
    documentation in the Government F/EA’s, reporting agent’s or subagent’s files?

86. Does the Government F/EA, or its reporting agent or subagent, have a system in place
    for withholding state unemployment insurance tax individually for each individual it
    represents using the individual’s FEIN and /or his or her state employer registration
    number per state requirements and for maintaining the relevant documentation in the
    Government F/EA’s, reporting agent’s or subagent’s files?

87. Does the Government F/EA, or its reporting agent or subagent, have written policies
    and procedures for withholding state unemployment insurance taxes individually for
    each individual it represents using the individual’s FEIN and /or his or her state
    employer registration number per state requirements and maintaining the relevant
    documentation in the Government F/EA’s, reporting agent’s or subagent’s files?

88. Does the Government F/EA, or its reporting agent or subagent, have internal controls
    documented and in place to monitor the withholding of state unemployment taxes
    individually for each individual it represents using the individual’s FEIN and /or his
    or her state employer registration number per state requirements and maintaining the
    relevant documentation in the Government F/EA’s, reporting agent’s or subagent’s
    files?
89. Does the Government F/EA, or its reporting agent or subagent, have a s ystem in place
    for filing state unemployment insurance tax individually for each individual it
    represents using the individual’s FEIN and /or his or her state employer registration
    number per state requirements and for maintaining the relevant documentatio n in the
    Government F/EA’s, reporting agent’s or subagent’s files?

 23
   This includes preparing and submitting a final filing of state unemploy ment taxes for the ind ividual
 indicating that this will be the last filing. The procedure for this should be confirmed with the State’s
 Unemploy ment Insurance Agency.

 Prepared by Susan Flanagan, Ph.D., M.P.H.             21                                              10/15/07
 The Westchester Consulting Group
90. Does the Government F/EA, or its reporting agent or subagent, have written policies
    and procedures for filing state unemployment insurance taxes individually for each
    individual it represents using the individual’s FEIN and /or his or her state employer
    registration number per state requirements and maintaining the relevant
    documentation in the Government F/EA’s, reporting agent’s or subagent’s files?

91. Does the Government F/EA, or its reporting agent or subagent, have internal controls
    documented and in place to monitor the filing of state unemployment taxes
    individually for each individual it represents using the individual’s FEIN and /or his
    or her state employer registration number per state requirements and maintaining the
    relevant documentation in the Government F/EA’s, reporting agent’s or subagent’s
    files?

92. Does the Government F/EA, or its reporting agent or subagent, a have a system in
    place for depositing state unemployment taxes individually for each individual per
    state payment schedule and for maintaining the relevant documentation in the
    Government F/EA’s, reporting agent’s or subagent’s files?

93. Does the Government F/EA, or its reporting agent or subagent, have written policies
    and procedures for depositing state unemployment taxes individually for each
    individual per state payment schedule and for maintaining the relevant documentation
    in the Government F/EA’s, reporting agent’s or subagent’s files?

94. Does the Government F/EA, or its reporting agent or subagent, have internal controls
    documented and in place to monitor the depositing of state unemployment taxes
    individually for each individual per state payment schedule and the maintenance of
    relevant documentation in the Government F/EA’s, reporting agent’s or subagent’s
    files?

95. If applicable, does the Government F/EA, or its reporting or subagent, have a system
    in place for filing locality taxes related to employment and for maintaining the
    relevant documentation in the Government F/EA’s, reporting agent’s or subagent’s
    file?

96. If applicable, does the Government F/EA or its reporting or subagent have a system in
    place for filing of locality taxes related to employment and for maintaining the
    relevant documentation in the Government F/EA’s, reporting agent’s or subagent’s
    file?

97. If applicable, does the Government F/EA or its reporting or subagent internal controls
    documented and in place to monitor the filing and paying locality taxes related to
    employment and for maintaining the relevant documentation in the Government
    F/EA’s, reporting agent’s or subagent’s file?




 Prepared by Susan Flanagan, Ph.D., M.P.H.   22                                     10/15/07
 The Westchester Consulting Group
 98. If applicable, does the Government F/EA, or its reporting or subagent, have a system
     in place for depositing locality taxes related to employment and for maintaining the
     relevant documentation in the Government F/EA’s, reporting agent’s or subagent’s
     file?

 99. If applicable, does the Government F/EA or its reporting or subagent have a system in
     place for depositing locality taxes related to employment and for maintaining the
     relevant documentation in the Government F/EA’s, reporting agent’s or subagent’s
     file?

100. If applicable, does the Government F/EA or its reporting or subagent internal controls
     documented and in place to monitor the process for filing and paying locality taxes
     related to employment and for maintaining the relevant documentation in its files?

101. Does the Government F/EA, or its reporting agent or subagent, have a system in place
     for managing the application of all garnishments, levies and liens on workers’ payroll
     checks in an accurate and timely manner and for maintaining the relevant
     documentation in the Government F/EA’s, reporting agent’s or subagent’s files?

102. Does the Government F/EA, or its reporting agent or subagent, have written policies
     and procedures for managing the application of all garnishments, levies and liens on
     workers’ payroll checks in an accurate and timely manner and for maintaining the
     relevant documentation in the Government F/EA’s, reporting agent’s or subagent’s
     files?

103. Does the Government F/EA, or its reporting agent or subagent, have an internal
     control documented and in place to monitor the accuracy and timeliness of the
     application of garnishments, levies and liens on workers’ payroll checks in an
     accurate and timely manner and for maintaining the relevant documentation in the
     Government F/EA’s, reporting agent’s or subagent’s files?

104. Does the Government F/EA, or its reporting agent or subagent, have a system in place
     to pay individuals’ workers within the time period required by the state department of
     labor (e.g., per State “Payday” requirement) and for maintaining the relevant
     documentation in the Government F/EA’s, reporting agent’s or subagent’s file ?

105. Does the Government F/EA, or its reporting agent or subagent, have written policies
     and procedures for paying individuals’ workers within the time period required y the
     state department of labor (e.g., State “Payday” requirement) and for maintaining the
     relevant documentation in the Government F/EA’s, reporting agent’s or subagent’s
     file?

106. Does the Government F/EA, or its reporting agent or subagent, have an internal
     control documented and in place to monitor the paying of individuals’ workers within
     the time period required by the state department of labor (e. g., State “Payday”



  Prepared by Susan Flanagan, Ph.D., M.P.H.   23                                    10/15/07
  The Westchester Consulting Group
      requirement) and for maintaining the relevant documentation in the Government
      F/EA’s, reporting agent’s or subagent’s file?

107. Does the Government F/EA, or its reporting agent or subagent, have a system in place
     for processing workers direct deposit and maintaining the relevant documentation in
     each worker’s file?

108. Does the Government F/EA, or its reporting agent or subagent, have written policies
     and procedures for processing direct deposit and for maintaining the relevant
     documents in the Government F/EA’s, reporting agent’s or subagent’s files?

109. Does the Government F/EA, or its reporting agent or subagent, have an internal
     control documented and in place to monitor the direct deposit process and the
     maintenance of relevant documentation in the worker’s file?

110. Does the Government F/EA, or its reporting agent or subagent, have a system in
     place for submitting any unclaimed funds for all entities (workers and vendors) to the
     State Treasury Department in accordance with the state’s unclaimed property act and
     for maintaining all relevant documentation in the workers’ and vendors’ files?

111. Does the Government F/EA, or its reporting agent or subagent, have written policies
     and procedures for submitting any unclaimed funds for all entities (workers and
     vendors) to the State Treasury Department in accordance with the state’s unclaimed
     property act and for maintaining all relevant documentation in the workers’ and
     vendors’ files?

112. Does the Government F/EA, or its reporting agent or subagent, have internal controls
     documented for monitoring the submission any unclaimed funds for all entities
     (workers and vendors) to the State Treasury Department in accordance with the
     state’s unclaimed property act and the maintenance of all relevant documentation in
     the workers’ and vendors’ files?

113. Does the Government F/EA, or its reporting agent or subagent, have a system in
     place for processing wage information requests from federal and state agencies and
     other qualified entities and maintaining all relevant documentation and
     correspondence in the worker’s file?

114. Does the Government F/EA, or its reporting or subagent, have written policies and
     procedures for processing wage information requests from federal and state agencies
     and other qualified entities and maintaining all correspondence and documentation
     in the worker’s file?

115. Does the Government F/EA, or its reporting or subagent, have internal controls
     documented and in place to monitor the processing wage information requests from
     federal and state agencies and other qualified entities and the maintenance all
     documentation and correspondence in the worker’s file?


  Prepared by Susan Flanagan, Ph.D., M.P.H.   24                                    10/15/07
  The Westchester Consulting Group
V.       End of Year Fede ral Tax Procedures


1. Does the Government F/EA have a system in place for refunding over collected FICA
   to applicable individual-employers (or state or county government) and employees in
   accordance with the December 18, 2000 IRS letter and for maintaining the relevant
   documentation in the Government F/EA’s files? 24

2. Does the Government F/EA have written policies and procedures for refunding over
   collected FICA to applicable individual-employers (or state or county government)
   and employees in accordance with the December 18, 2000 IRS letter, and maintaining
   the relevant documentation in the Government F/EA’s files?

3. Does the Government F/EA have internal controls documented and in place to
   monitor the refunding of over collected FICA to applicable individual-employers (or
   state or county government) and employees in accordance with the December 18,
   2000 IRS letter and for maintaining the relevant documentation in the Government
   F/EA’s files?

4. Does the Government F/EA, or its reporting agent or subagent, have a system in place
   for preparing and distributing IRS Forms W-2 for individuals’ workers in accordance
   with IRS instructions for agents, file IRS Forms W-2 electronically when processing
   250 or more forms, and maintaining the relevant documentation in the Government
   F/EA’s, reporting agent’s or subagent’s files? 25

5. Does the Government F/EA, or its reporting agent or subagent, have written policies
   and procedures for preparing and distributing IRS Forms W-2 for individuals’
   workers in accordance with IRS instructions for agents, file IRS Forms W-2
   electronically when processing 250 or more forms, and maintaining the relevant
   documentation in the Government F/EA’s, reporting agent’s or subagent’s files?

6. Does the Government F/EA, or its reporting agent or subagent, have a system in place
   for preparing and distributing IRS Forms W-3 in the aggregate for all individuals the



24
   Using a method described in the December 18, 2000 IRS letter prepared by Marie Cashman. It is
recommended that Agents use the “Repayment” method described in the letter and make the adjustment for
over collected FICA in the 4th quarter of a calendar year. Then refund the applicable emp loyee and
emp loyer by the end of the calendar year. States need to decide if they want the employer share of over
collected FICA to go back into the individual’s budget or if they want it refunded to the State. The Vendor
F/EA or Govern ment F/ EA also may choose to use the “refund” box on the Form 941 rather than using the
IRS Form 843 method should it need to request a refund of over collected FICA fro m the IRS (usually this
is needed to refund the emp loyer portion of over collected FICA) in addit ion to withholding FICA
withholding fro m 4th quarter FICA deposits.
25
   Govern ment F/ EAs or their report ing agent or subagent must report the individual’s State income tax
emp loyer ID nu mber in Bo x 15 on the IRS Form W -2 since the Govern ment F/ EA does not receive a
separate state income tax emp loyer ID nu mber. In addit ion, some states have specific instructions for filing
the state copy of the IRS Form W-2 and W-3. Agents should clarify this with the State taxing authorities.

Prepared by Susan Flanagan, Ph.D., M.P.H.             25                                              10/15/07
The Westchester Consulting Group
      Agent represents per IRS instructions for agents and maintaining the relevant
      documentation in the Government F/EA’s, reporting agent’s or subagent’s files? 26

7. Does the Government F/EA, or its reporting agent or subagent, have written policies
   and procedures for preparing and distributing IRS Forms W-3 in the aggregate for all
   individuals the Agent represents per IRS instructions for agents and maintaining the
   relevant documentation in the Government F/EA’s, reporting agent’s or subagent’s
   files?

8. Does the F/EA, or its reporting agent or subagent, have internal controls documented
   and in place to monitor the preparation and distribution of IRS Form W-2 and 3 in
   accordance with IRS instructions for agents and maintaining the relevant
   documentation in the Government F/EA’s, reporting agent’s or subagent’s files?


VI.      Processing Payment for Independent Contractors Who Provide Services and
         Supports To Individuals and Their Representatives

In general, IRS considers unskilled home-based care workers as employees and not
independent contractors. However, there may be an occasion where an individual may
contract with a bonafide independent contractor to receive an approved good or service.

If there is a question regarding a worker’s employment status, the Government F/EA or
its subagent or reporting agent should require that the individual prepare an IRS Form
SS-8, Determination of Worker Status for Purposes of Federal Employment Taxes and
Income Tax Withholding and file it with the IRS to obtain a decision on the worker’s
employment status prior to the Government F/EA, reporting agent or subagent processing
payment for the individual as an independent contractor. 27

1. Does the Government F/EA or its subagent or reporting agent have a system in place
   to verify the status of a worker related to independent contractor status and for
   maintaining all relevant documentation in the worker’s file?

2. Does the Government F/EA or its subagent or reporting agent have a written policy
   and procedure in place to verify the status of a worker related to independent
   contractor status and for maintaining all relevant documentation in the worker’s file?

3. Does the Government F/EA or its subagent or reporting agent have an internal control
   documented for monitoring the verification of workers’ status related to independent
   contractor status and the maintenance of all relevant documentation in the worker’s
   file?
26
    Govern ment F/ EAs or their report ing agent or subagent must leave Bo x 15 on the IRS Fo rm W -3 b lank.
If the Agent is electronically filing IRS Forms W -2, it does not have to file an IRS Form W-3.
27
    So me states also have their own Determination of Worker Status Form. Govern ment F/ EAs or their
reporting agent or subagent should find out if the state will recognize the IRS Form SS-8 and decision
received or if the consumer also has to file the state form and get a decision. In addition, The IRS decision
is individual and not worker group specific.

Prepared by Susan Flanagan, Ph.D., M.P.H.            26                                              10/15/07
The Westchester Consulting Group
4. If a worker has been determined to be an independent contractor, does the
   Government F/EA or its subagent or reporting agent have a system in place to obtain
   a completed and signed IRS Form W-9 from each independent contractor working for
   an individual and for maintaining a copy of the form in each applicable worker’s file?

5. If a worker has been determined to be an independent contractor, does the
   Government F/EA or its subagent or reporting agent have a written policy and
   procedure for obtaining a completed and signed IRS Form W-9 from each
   independent contractor working for an individual and for maintaining copies of the
   form in each applicable worker’s file?

6. If a worker has been determined to be an independent contractor, does the
   Government F/EA or its subagent or reporting agent have an internal control
   documented and in place for monitoring the receipt of a completed and signed IRS
   Form W-9 from each independent contractor working for a individual and for
   maintaining copies of the Form in each applicable worker’s file?

7. For each independent contractor who has been paid $600 or more in a calendar year,
   does the Government F/EA or its subagent or reporting agent have a system in place
   for processing an IRS Form 1099 for that independent contractor and for maintaining
   all relevant documentation in each applicable worker’s file ?

8. For each independent contractor who has been paid $600 or more in a calendar year,
   does the Government F/EA or its subagent or reporting agent have a writte n policy
   and procedure for processing an IRS Form 1099 for these independent contractors
   and for maintaining all relevant documentation in each applicable worker’s file?

9. For each independent contractor who has been paid $600 or more in a calendar year,
   does the Government F/EA or its subagent or reporting agent have an internal control
   documented and in place to monitor the processing of IRS Forms 1099 for these
   independent contractors and the maintenance of all relevant documentation in each
   applicable worker’s file?


VII.    Custome r Service System

1. Does the Government F/EA, or its reporting or subagent, have a customer service
   system in place that includes:

      A toll free number,
      A fax,
      Web-based information regarding F/EA services,
      Internet/e- mail communication,
      Methods for disbursing and receiving enrollment and other information from
       individuals and support service workers,



Prepared by Susan Flanagan, Ph.D., M.P.H.   27                                    10/15/07
The Westchester Consulting Group
      Ability to provide translation and interpreter services (i.e. American Sign
       Language and services for persons with Limited English P roficiency),
      Materials available in alternate formats,
      Methods for receiving, returning and tracking calls from individuals and support
       service workers during and after regular business hours,
      Methods for receiving, responding to and tracking complaints from individuals and
       support service workers within a reasonable time period,
      Developed and implement orientation and skills training for individuals their
       represent,
      Developed and implemented customer services training for Government F/EA,
       subagent or reporting agent staff,
      Developed and implemented a individual/representative satisfaction survey, and
      Developed and implemented policies and procedures that emphasize the
       application of the philosophy of consumer direction and being culturally sensitive
       in all business practices in order to communicate effectively with a diverse
       population of participants of all ages and with a variety of needs, disabilities and
       chronic conditions.

2. Does the Government F/EA or its reporting agent or subagent have a system in place
   and written policies and procedures for producing distributing and collecting
   individual enrollment packets as described in Section II, Preparing and Distributing
   Program Participant Enrollment and Worker Employment Packets and internal
   controls documented to monitor the process as described in Section II.

3. Does the Government F/EA or its reporting agent or subagent have a system in place
   and the written policies and procedures for producing, distributing, collecting and
   processing employment packets for individuals’ and workers and internal controls
   documented to monitor the process as described in Section II.

4. Does the Government F/EA or its reporting agent or subagent have written policies
   and procedures that describes the components of its customer service system?

5. Does the Government F/EA or its reporting agent or subagent have internal controls
   documented and in place to monitor the operation of its customer service system?


VIII. Record Management Process

1. Does the Government F/EA and its reporting agent or subagent, as applicable, have a
   system in place for establishing and maintaining current individual, worker and F/EA
   files in a secure and confidential manner as required by federal and state rules and
   regulations (e.g., meet any applicable HIPAA requirements)?

2. Does the Government F/EA and its reporting agent or subagent, as applicable, have a
   written policies and procedures for establishing and maintaining current individual,
   worker and F/EA files in a secure and confidential manner and for the proscribed

Prepared by Susan Flanagan, Ph.D., M.P.H.   28                                     10/15/07
The Westchester Consulting Group
      period of time as required by federal and state rules and regulations (e.g., federal and
      state record retention rules and any applicable HIPAA requirements)?

3. Does the Government F/EA and its reporting agent or subagent, as applicable, have
   internal controls documented and in place to monitor the establishment and
   maintenance of current individual, worker and F/EA files?

4. Does the Government F/EA and its reporting agent or subagent, as applicable, have a
   system in place for establishing and maintaining archived individual, worker and
   F/EA files in a secure and confidential manner as required by federal and state rules
   and regulations (e.g., meet any applicable HIPAA requirements)?

5. Does the Government F/EA and its reporting agent or subagent, as applicable, have a
   written policies and procedures for establishing and maintaining archived individual,
   worker and F/EA files in a secure and confidential manner and for the proscribed
   period of time as required by federal and state rules and regulations (e.g., federal and
   state record retention rules and any applicable HIPAA requirements)?

6. Does the Government F/EA and its reporting agent or subagent, as applicable, have
   internal controls documented and in place to monitor the establishment and
   maintenance of archived individual, worker and F/EA’s/reporting agent’s or
   subagent’s files?

7. Does the Government F/EA and its reporting agent or subagent, as applicable have a
   disaster recovery plan for electronic and hard copy files in place and documented?
   Does it have a plan for testing the system at least annually?


IX.      Brokering Workers’ Compensation Insurance

1. Does the Government F/EA, or its reporting agent or subagent, have a system in place
   to process and pay workers’ compensation insurance policies for e ach individual it
   represents in accordance with the state’s workers’ compensation insurance law and
   for maintaining all relevant documentation in each individual’s file ?

2. Does the Government F/EA, or its reporting agent or subagent, have written policies
   and procedures for processing and paying workers’ compensation insurance premium
   for each individual it represents in accordance with the state’s workers’ compensation
   insurance law and for maintaining all relevant documentation in each individual’s
   file?

3. Does the Government F/EA, or its reporting agent or subagent, have internal controls
   documented and in place to monitor the processing and paying of workers’
   compensation insurance premiums for each individual it represents in accordance
   with the state’s workers’ compensation insurance law and the maintenance all
   relevant documentation in each individual’s file?


Prepared by Susan Flanagan, Ph.D., M.P.H.      29                                       10/15/07
The Westchester Consulting Group
X.      Preparing and Maintaining a Governme nt Fiscal/Employer Agent Policies
        and Procedures Manual and Government Agency and Reporting or
        Subagent Staying Up-to-Date With Federal and State Rules and Regulations
        Regarding Gove rnment Fiscal/Employer Agents and Household Employers

1. Does the Government F/EA and its reporting agent or subagent, as applicable, have
   an automated comprehensive Government F/EA Policies and Procedures Manual that
   includes all policies and procedures related to all F/EA tasks, including the role and
   tasks of any subagent or reporting agent used, the transmittal and receipt of
   information to and from the subagent or reporting agent, the communication function
   between the Government F/EA and its subagent or reporting agent and monitoring the
   performance of the subagent or reporting agent? The Manual must internal controls
   for monitoring the completion of all Government F/EA and reporting agent or
   subagent tasks.

2. Does the Government F/EA have a system in place, written policies and procedures
   and internal controls for maintaining and updating its Government F/EA policies and
   procedures manual at least annually and as needed?

3. Does the Government F/EA and its reporting agent or subagent, have a system in
   place for reviewing and updating all IRS forms, instructions, notices and publications
   related to Government F/EAs, household employers and domestic service workers
   and preparing, filing and depositing federal taxes on behalf of household
   employers/individuals it represents at www.irs.gov?

4. Does the Government F/EA and its reporting agent or subagent, have written policies
   and procedures for reviewing and updating all IRS forms and instructions, notices and
   publications related to Government F/EAs, household employers and domestic
   service workers and preparing, filing and depositing federal taxes on behalf of
   household employers/individuals it represents at www.irs.gov?

5. Does the Government F/EA and its reporting agent or subagent, have an internal
   control documented and in place to monitor the updating of all IRS forms and
   instructions, notices and publications related to Government F/EAs, household
   employers and domestic service workers and preparing , filing and depositing federal
   taxes on behalf of household employers/individuals it represents at www.irs.gov?

6. Does the Government F/EA and its reporting agent or subagent have a system in
   place for reviewing and updating all applicable US Citizenship and Immigration
   Service (USCIS) rules, forms (i.e., Form I-9, Employment Eligibility Verification) and
   instructions (Key web site: www.uscis.gov)?

7. Does the Government F/EA and its reporting agent or subagent have written policies
   and procedures for reviewing and updating all applicable USCIS rules, forms (i.e.,
   Form I-9, Employment Eligibility Verification) and instructions (Key web site:
   www.uscis.gov)?


Prepared by Susan Flanagan, Ph.D., M.P.H.   30                                    10/15/07
The Westchester Consulting Group
 8. Does the Government F/EA and its reporting agent or subagent have internal controls
    documented for monitoring the review and updating all applicable USCIS rules,
    forms (i.e., Form I-9, Employment Eligibility Verification) and instructions (Key web
    site: www.uscis.gov)?

 9. Does the Government F/EA and its reporting agent or subagent have a system in
    place for reviewing and updating all applicable federal Department of Labor rules,
    forms and instructions related to household employers and domestic service
    employees pertaining to the Federal Fair Labor Standards Wage and Hour rules (Key
    website: www.dol.gov)?

10. Does the Government F/EA and its reporting agent or subagent have a written
    policies and procedures for reviewing and updating all applicable federal Department
    of Labor rules, forms and instructions related to household employers and domestic
    service employees pertaining to the Federal Fair Labor Standards Wage and Hour
    rules (Key website: www.dol.gov)?

11. Does the Government F/Ea and its reporting agent or subagent have internal controls
    documented for monitoring the review and updating all applicable federal Department
    of Labor rules, forms and instructions related to household employers and domestic
    service employees pertaining to the Federal Fair Labor Standards Wage and Hour
    rules (Key website: www.dol.gov)?

12. Does the Government F/EA and its reporting agent or subagent, have a system in
    place for reviewing and updating all state income tax withholding forms, instructions
    and manuals related to Government F/EAs, household employers and domestic
    service workers and preparing, filing and depositing state taxes on behalf of
    household employers/ individuals it represents at the appropriate state web sites?

13. Does the Government F/EA and its reporting agent or subagent, have written policies
    and procedures for reviewing and updating all state income tax withholding forms,
    instructions related to Government F/EA, household employers and domestic service
    workers and preparing, filing and depositing state taxes on behalf of household
    employers/ individuals it represents the appropriate state web sites?

14. Does the Government F/EA and its reporting agent or subagent, have internal controls
    documented for monitoring the review and updating all state income tax withholding
    forms, instructions related to Government F/EA, household employers and domestic
    service workers and preparing, filing and depositing state taxes on behalf of
    household employers/ individuals it represents the appropriate state web sites?

15. Does the Government F/EA and its reporting agent or subagent, have a system in
    place for reviewing and updating all state unemployment insurance tax forms,
    instructions and manuals related to Government F/EAs, household employers and
    domestic service workers and preparing, filing and depositing state taxes on behalf of
    household employers/ individuals it represents at the appropriate state web sites?


 Prepared by Susan Flanagan, Ph.D., M.P.H.   31                                    10/15/07
 The Westchester Consulting Group
16. Does the Government F/EA and its reporting agent or subagent, have written policies
    and procedures for reviewing and updating all state unemployme nt insurance tax
    forms, instructions related to Government F/EA, household employers and domestic
    service workers and preparing, filing and depositing state taxes on behalf of
    household employers/ individuals it represents the appropriate state web sites?

17. Does the Government F/EA and its reporting agent or subagent, have internal controls
    documented for monitoring the review and updating all state unemployment tax
    forms, instructions related to Government F/EA, household employers and domestic
    service workers and preparing, filing and depositing state taxes on behalf of
    household employers/ individuals it represents the appropriate state web sites?

18. Does the Government F/EA and its reporting agent or subagent have a system in
    place for staying up-to-date with the state’s new hire registration process (paper or
    electronic filing options)?

19. Does the Government F/EA and its reporting agent or subagent have written policies
    and procedures for staying up-to-date with the state’s new hire registration process
    (paper or electronic filing options)?

20. Does the Government F/EA and its reporting agent or subagent have internal controls
    documented for staying up-to-date with the state’s new hire registration process
    (paper or electronic filing options)?

21. Does the Government F/EA and its reporting or subagent have a system in place for
    staying up-to-date with state workers’ compensation insurance laws pertaining to
    household employers who hire personal care and other support service workers?

22. Does the Government F/EA and its reporting or subagent have written policies and
    procedures for staying up-to-date with state workers’ compensation insurance laws
    pertaining to household employers who hire personal care and other support service
    workers?

23. Does the Government F/EA and its reporting or subagent have internal controls
    documented to monitor its process for staying up-to-date with state workers’
    compensation insurance laws pertaining to household employers who hire personal
    care and other support service workers?


 XI.     Managing Invoices For Goods and Services Rendered and Included In
         Individuals’ Individual Service Plans and Budgets

 1. Does the Government F/EA, or its reporting agent or subagent, have a system in place
    for receiving, verifying, processing and paying invoices for goods and services
    rendered and included in individuals’ individual service plans and budgets?


 Prepared by Susan Flanagan, Ph.D., M.P.H.    32                                     10/15/07
 The Westchester Consulting Group
2. Does the Government F/EA, or its reporting agent or subagent, have written policies
   and procedures for receiving, verifying, processing and paying invoices for good s and
   services rendered and included in individuals’ individual service plans and budgets?

3. Does the Government F/EA, or its reporting agent or subagent, have internal controls
   in place for monitoring the receipt, verification, processing and payment of invoices
   for goods and services rendered and included in individuals’ individual service plans
   and budgets? 28

4. Does the Government F/EA have a system in place for developing and maintaining a
   database that is effective in tracking and responding to occurrences of invoices for
   goods and services that can not be paid due to missing or erroneous information?

5. Does the Government F/EA have written policies and procedures for developing
   and maintaining a database that is effective in tracking and responding to
   occurrences of invoices for goods and services that can not be paid due to
   missing or erroneous information?

6. Does the Government F/EA have internal controls to monitor the development
   and maintenance of a database that is effective in tracking and responding to
   occurrences of invoices for goods and services that can not be paid due to
   missing or erroneous information?


XII.     Preparing and Submitting The Required Reports To State/County
         Government and Individuals/Representatives

1. Does the Government F/EA’s reporting or subagent have a system in place to prepare
   and submit the required reports to the state/county government and
   individuals/representatives? 29

2. Does the Government F/EA’s reporting or subagent have a written policies and
   procedures for preparing and submitting the required reports to the state/county
   government and individuals/representatives?

3. Does the Government F/EA’s reporting or subagent have internal controls
   documented and in place to monitor the preparation and submission of required
   reports to the state/county government and individuals/representatives?




28
   Proper segregation of tasks is a very important internal control for these tasks.
29
    Govern ment F/ EA will want to identify the reports it (or its reporting agent or subagent) will produce for
its own use and for enrolled individual service recip ients and these may vary by state.

Prepared by Susan Flanagan, Ph.D., M.P.H.              33                                              10/15/07
The Westchester Consulting Group

								
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