A glitch has caused some financial issues within the Manitowoc Public School District.
A memo from Businesses Manager Angela Erdmann says Skyward, an education software program that helps the district, didn’t correctly reflect W2s when the district sent them to the Social Security Administration and Wisconsin Department of Revenue.
She says codes were set up in Skyward to make sure tax settings were correct, but inadvertently, the Wisconsin Retirement System deduction codes were missed, so it reduced Federal, State, and FICA taxes when it should have reduced Federal and State tax deductions.
In layman’s terms, the software didn’t properly tax employees for Social Security and Medicare.
After checking to see if insurance covers the issue, which it didn’t, the district will have to collect the amount owed by employees, meaning employees will have to give money back that the district didn’t tax.
It will cost about $102,856 each year or $205,713 altogether each fiscal year, which Erdmann says is already budgeted each year.
Tax owed will be paid over the next nine payrolls to ensure that all employees can reimburse the overpayment if they still work in the district, but retired teachers will be sent a letter with the amount they owe in detail.
Erdmann says there are systems in place now to ensure that at least two people would review any changes to deduction tax codes in the rare event this happens again.
