APS faces hefty fines for missing IRS deadlines

Audit finds W-2s were filed late, payroll tax payments also tardy

Albuquerque Public Schools could be facing hundreds of thousands of dollars in penalties from the IRS related to late tax form filings and late payment of payroll taxes.

In the district’s audit report for the fiscal year that ended June 30, 2020, reviewers highlighted overdue submissions of W-2 forms for 2018 and late payment of payroll taxes for the fiscal year that ended Sept. 30, 2019, in their findings.

“The school district is not in compliance with state of New Mexico statutes and is considered (to have) lost funding that should be used for education,” the audit report said.

The combined penalties could total $666,379, according to the report.

But APS officials said Monday at a virtual meeting that they are appealing.

Board of Education President David Peercy said that the fines made the findings a concern and that he wanted the administration to ensure they wouldn’t happen again.

Ben Lubkeman, executive director of accounting, said the late payment of payroll taxes was caused by “human error.”

“The process-level report was ran at a wrong level at the payroll site. (It) did not pick up all employees in the district. When we discovered the error approximately four weeks later … we immediately paid the remainder,” Lubkeman said.

He told the board that the district has appealed the fines but hasn’t heard back from the IRS.

As for the late filing of W-2 forms, Lubkeman said a law change altered the due date, which was overlooked and resulted in the error. That penalty has also been appealed, and the district is waiting for a determination.

Lubkeman said that out of 92 findings in the audit report, 88 were related to charter schools that APS authorizes.

The school district received an unmodified financial statement opinion, and the Board of Education voted unanimously to accept the fiscal year 2020 report.