The government gets millions of forms each year from employees whose Social Security numbers don't match government records, leading investigators to call Thursday for more action against employers hiring illegal immigrants.
"Unless and until employers are either required to verify (Social Security numbers) prior to submitting wage reports, or faced with stiff penalties for erroneous wage reports, there is no incentive for employers to do anything differently," the Social Security Administration's inspector general, Patrick O'Carroll, told a group of lawmakers on the House Ways and Means Committee.
The Government Accountability Office said discussions among government agencies about sharing more information about workers who may be illegal immigrants "will not make a difference if the relevant federal agencies do not have credible enforcement programs."
The Social Security Administration collects wage information about employees to determine retirement and disability benefits, while the Homeland Security Department and the Internal Revenue Service play roles in enforcing the laws relating to employees and employers.
Stewart Baker, assistant Homeland Security secretary for policy, said the department is eager to get more information about people in the Social Security Administration's files whose identification information does not match government files. Using that information, the department said it could better target its enforcement of immigration laws.
Illegal immigrants will try to cross U.S. borders "until we can persuade people that it's not easy to get a job in the United States just by making up a Social Security number," he said.
Laws protecting the privacy of taxpayer information, however, prevent the Homeland Security Department from getting some information about employees and employers.
IRS Commissioner Mark Everson said lawmakers should consider that sharing taxpayer information with the Homeland Security Department will likely deter some workers from filing tax returns and paying taxes.
"As IRS commissioner, we want our share of your money whether or not you earned it legally or illegally," he said.
Everson said the law puts most responsibility on workers, not employers, for reporting accurate identification information, making it difficult for the tax agency to fine employers when worker information proves inaccurate.
To better get a handle on the role of employers, however, the IRS has about 300 intensive audits under way of employers who regularly run afoul of the laws.
Late last year, the House passed an immigration bill that would eventually require all employers to verify employees' Social Security numbers or face civil or criminal penalties for hiring illegal workers.
The Homeland Security Department is running a pilot program used by about 8,000 employers to verify employees' Social Security numbers. About 6.5 million employers would have to use the verification system if the House bill becomes law.
"If the basic pilot were to be made mandatory as under the provisions of the House bill, would the system have the capacity to handle 6 million employers in this country?" asked Rep. Jim McCrery, R-La.
"I think we have some concerns about that," answered Barbara Bovbjerg, director of education, work force and income security issues at the Government Accountability Office.