Comptrollers Call Out Lewis County Officials for IRS Problems


Lewis County officials failed to report and remit federal employment taxes totaling more than $150,000, and the IRS has gotten involved.

This, according to an audit Tennessee Comptrollers released this week.

“Lewis County had deficiencies in depositing and reporting federal employment taxes, as noted in the prior-year audit report. During the period under review, the Internal Revenue Service (IRS) determined Lewis County had failed to report and remit federal employment taxes totaling $153,539 for the period October 2016 through March 2019. Furthermore, penalty and interest charges were assessed totaling $132,433 through June 30, 2019. Auditors proposed adjustments to reflect the total IRS liability of $285,972 ($153,539 plus $132,433), which management accepted to properly recognize this liability in the financial statements of this report,” according to the audit.

“On August 13, 2019, Lewis County remitted $129,368 to the IRS to partially satisfy the outstanding liability. On September 17, 2019, the IRS recorded a Notice of Federal Tax Lien totaling $123,345 against Lewis County. As a result of the lien, the county mayor entered a contract for tax consultation and representation services on September 25, 2019. On November 1, 2019, Lewis County remitted $156,604 to the IRS to satisfy the accumulated taxes, penalties, and interest, and the tax lien was removed. Lewis County’s tax consultant has appealed the payment of penalty and interest.”

Comptrollers faulted county officials for, among other things, not properly reporting their tax liability to the IRS and for not making federal tax deposits in a timely manner.

This is a problem that has afflicted other Tennessee counties.

As The Tennessee Star reported earlier this month, federal officials recently penalized Sevier County with a fine of nearly $45,000 for not complying with IRS regulations.

As The Tennessee Star reported last year:

• Rockwood, Tennessee’s public utility officials didn’t file the proper Obamacare forms with the Internal Revenue Service on time, and now the utility must pay the feds more than $25,0000 in penalty costs.

• The IRS assessed nearly $400,000 in penalties and interests against the Maury County School Department.

• The IRS fined Jackson County officials a sum of $86,147 for failing to comply with Obamacare. That penalty money, of course, came from county taxpayers.

• The Grundy County School System had to pay more than $34,000 in penalties to the IRS for not complying with Obamacare.

• Hancock County officials did not remit two payroll tax deposits to the Internal Revenue Service, which caused an assessment of interest and penalties totaling more than $2,000.

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Chris Butler is an investigative journalist at The Tennessee Star. Follow Chris on Facebook. Email tips to [email protected]
Photo “Lewis County Courthouse” by Skye Marthaler. CC BY-SA 3.0.








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