Court Opinion

ID: 4008575
Source: CourtListenerOpinion
Date Created: 2016-07-06 11:08:56.611195+00
Date Added: 2024-06-11T14:19:12.949297
License: Public Domain

WILBUR J. SCHMIDT, Secretary, Department of Health and SocialServices
You request my opinion as to whether the Department of Health and Social Services has the legal authority to collect social security tax deductions in situations where such deductions were not made at the time the employes were paid. You also ask whether there is any time limit after which you cannot collect such amounts, even though legally assessed by the Social Security Administration within the applicable federal statute of limitations.
It is my opinion that your department has both the authority and duty to collect the employe's portion of the social security tax in the situation referred to above. Section 40.42, Stats., provides the authority to your agency to withhold from each employe's compensation that amount required under federal regulations. Such section further provides that the state is liable for all such deductions regardless of whether or not they are made at the required time. The material portions of sec. 40.42, Stats., read:
"40.42 Financial participation. (1) Each public agency included under an agreement made pursuant to this subchapter shall be liable for and shall make the contributions required of an employer under federal regulations.
"(2) Each public agency included under such an agreement shall withhold from the persons compensated by such public agency who are covered by such agreement the portion of such compensation required to be withheld under the federal regulations.
"(3) The contributions required under sub. (1) and the amounts withheld under sub. (2) shall be remitted by each public agency in conformity with rules promulgated under s. 40.43. The state shall be liable for all such remittances due from public *Page 238 
agencies in conformity with the agreement under s. 40.41 (9), and shall make payment of all sums which are due under this subsection and become delinquent."
Coverage of state and local governments is voluntary under federal law and is accomplished only by agreement between the state and the U.S. Secretary of Health, Education and Welfare. By such agreement, the state contracts to buy social security protection for employes that it brings under the agreement. The state itself is required by federal law and the federal-state agreement to assume the full financial responsibility for the cost of providing the coverage. See 42 U.S.C., sec. 418. Employer and employe contributions under the federal-state contract are the same as though the employes were mandatorily covered under the Federal Insurance Contributions Act.
It is clear from subsec. (1) of sec. 40.42, Stats., quoted above, that a "public agency" is intended to be liable and responsible only for "employer" contributions, notwithstanding the requirement of the federal-state agreement that the state must pay the required amounts when due and later collect from public agencies. See sec. 40.42 (4), Stats. I am aware of no provision of the federal code or state statutes which precludes you from collecting the "employe" contributions which were not deducted due to a mistake of law. Your department is, therefore, obligated to recover the amounts not so deducted.
In answer to your second question, the time limit after which you cannot collect from the subject recipients is controlled by sec. 893.18 (6), Stats. Such section limits an action in favor of the state to the period of ten years after the cause of action has accrued. The cause of action accrued on the date that the Public Employees Social Security Fund Bureau paid the amount that should have been deducted from the paycheck of the employe.
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