CHESTERVILLE — A penalty the town paid to the IRS earlier this year was for failing to file reports on payroll taxes, according to information shared at Thursday night’s selectmen meeting.

Board Chairman Guy Iverson and Selectman Matt Welch recently met with attorney Frank Underkuffler, who provided a statement to be released to the public.

“The town did not file timely (IRS) 941 reports for the third quarter of 2014, the fourth quarter of 2014, the first quarter of 2015 and the third quarter of 2015,” Underkuffler wrote. “As a result, the town incurred $2,608.74 in IRS interest and penalties.”

At a special town meeting this fall voters authorized spending up to $3,500 for payments to the IRS for penalties and interest. No details were given at that time.

IRS form 941 provides information on the number of employees, wages paid and federal income, social security and medicare taxes withheld. Submitted with the forms — due quarterly on April 30, July 31, Oct. 31 and Jan. 31 — should be payment for those taxes.

It was unclear who was responsible for filing the forms.

“The selectmen are hiring a former employee from a neighboring town to assist the town in adopting policies and procedures designed to avoid any similar problem in the future,” Underkuffler wrote. “The town’s attorney had instructed selectmen to say no more on this matter, due to the statutorily-required confidentiality surrounding any matter involving municipal employment.”

Iverson said potential employees have been approached to help the town, but no one has been hired. 

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