DIRECTIVE	:	UIS INFORMATION BULLETIN NO. 17-93
TO	:	ALL REGIONAL ADMINISTRATORS
FROM	:	MARY ANN WYRSCH Director Unemployment Insurance Service
SUBJECT	:	Wage Reporting Simplification Project

For several years, the Internal Revenue Service (IRS) and the Social Security Administration (SSA) have been engaged in efforts to simplify the employer wage reporting process, initially focusing on the Form W-2, Wage and Tax Statement. In August of 1992, several government agencies --IRS, SSA, and the Department of Labor (DOL), along with the Office of Management and Budget (OMB) and the Small Business Administration (SBA) --launched an initiative which is more concerted and broader in scope than the initial effort and is aimed at determining the feasibility of wage reporting simplification across Federal and State agencies. This iniitative is called the Wage Reporting Simplification Project (WRSP), with the feasibility study being conducted by the MITRE Corporation.

The overall objective of WSRP is to reduce employer reporting burden while maintaining or improving the effectiveness of government operations. The scope of this study includes:

• all Federal withholding and tax related filings (e.g., Forms 940, 941, 942, and943; W-2 and W-3; and Federal tax deposits),

• State employer tax forms, payments, and W-2s, and

• unemployment insurance (UI) contribution reports, payments, and quarterly wage records.

The feasibility study is being conducted in two phases. A report entitled "Wage Reporting Simplification Project: Overview of the Phase I Feasibility Study" (copy enclosed) summarizes the results of the first phase, and is being distributed to all States (UI and tax agencies) and employer representatives. Its purpose is to provide all key stakeholders with an overview of the range of concepts under consideration, along with the economic, institutional, and regulatory implications. In the second phase, inputs received from these parties will be used to focus the system concepts and to analyze possible implementation strategies for a Simplified Tax and Wage Reporting System (STAWRS). State participation in any such system would be voluntary. Also enclosed is a copy of a presentation given by Paul Harrington, IRS, at the recent National UI Directors meeting in Boston, Massachusetts

In addition to the government agencies, the Interstate Conference of Employment Security Agencies (ICESA), the National Governors' Association (NGA), and the Federation of Tax Administrators (FfA) are also actively involved in the project. External stakeholders include various employer representatives such as the National Federation of Independent Businesses, the American Payroll Association, the Bureau of National Affairs, etc.

As DOL's representative, the Unemployment Insurance Service (UIS) is well aware of the far-reaching implications WRSP has for the all program in terms of the potential impact on claimants, employers, and employees. Accordingly, DOL has established the following principles with respect to any reporting system that is developed as a result of this effort:

• The payment of UI benefits should 'not be inhibited.

• UI tax operations should not be disrupted or impeded.

• Administrative costs or burdens should not be added to the UI program.

• The Federal-State cooperative nature of the UI program should not be imperiled.

Part of the stakeholder participation process will include three open forums throughout the country during July and August (see below). It is anticipated that ICESA will notify the States of these forums and encourage their attendance. Regional Office staff are welcome to attend. The purpose of the forums is to provide comprehensive coverage of all issues with extensive opportunity for direct dialogue with study team members and participants.

Location	Date	Site
Washington, DC	July 22-23, 1993	Tyson's Corner Marriot Hotel
San Francisco, CA	Aug. 10-11, 1993	San Francisco Airport Marriot Hotel
Chicago, IL	Aug. 24-25, 1993	Woodfield Hilton Hotel

The National Office will keep you informed of additional key developments as they arise. If you have any questions concerning WRSP, please call Virginia Chupp or Lynne Webb on 202-219-5200.