A Michigan community college and the U.S. government have resolved a federal lawsuit involving penalties imposed after the school missed a deadline for filing employee wage reporting forms with tax authorities.
The case stemmed from Schoolcraft Community College District’s challenge to approximately $233,000 in penalties and interest assessed by the Internal Revenue Service (IRS) after the institution filed W-2 and W-3 wage statements late for the 2017 tax year.
Court documents indicated that the reporting delay occurred during a period when the college’s president was seriously ill and unable to supervise payroll administration. Responsibility for completing the filings was transferred between several employees, but communication failures and administrative confusion contributed to the missed deadline.
The college later discovered that the wage data had not been successfully transmitted to the Social Security Administration’s business reporting system, meaning federal authorities had no official record of updated employee wage information for thousands of staff members.
