IRS investigates county

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January 8, 2011

Tim Monzingo Jacksonville Daily Progress The Jacksonville Daily Progress Sat Jan 08, 2011, 04:04 PM CST

RUSK — County officials are awaiting an audit report from Internal Revenue Service agents who reportedly spent about a week reviewing payroll and other government files.

Two county officials confirmed a visit from IRS agents, but said they were unsure what exactly the agents were looking for and that the agents cleared most accounts.

“We were OK on everything, except they did question us about the pickups,” county auditor L.H. Crockett said, referencing county-owned vehicles used by county employees.

He said during the course of the week-long investigation, agents questioned him about the use of county-owned vehicles, but he didn’t know why they were interested in them.

“Where the county provides a pickup owned by the county for you (employees) to drive, they questioned us on that,” he said.

Crockett said during a seminar in 2007, an IRS speaker told auditors that the organization would be investigating state institutions, such as schools, county governments, water departments and “taxable fringe benefits.”

According to Crockett, a taxable fringe benefit is something employees are given a stipend on their checks to cover, such as use of a county vehicle.

“Some (employees) get a travel allowance. They don’t turn in mileage. They just get a set amount each month,” he said.

Crockett wasn’t the only county employee who said an IRS investigation was to be expected.

County Tax Assessor-Collector Linda Little said she was also told at a seminar that agents would be visiting Texas governmental bodies.

Little, who was an internal auditor for 14 years, said a representative told her those agents who had been working in Louisiana were relocating to Texas when she was at a seminar shortly after the Hurricane Katrina disaster.

“They’re doing that throughout the state of Texas, and their goal is to have every county audited within a certain period of time,” she said. “They were targeting government entities and that means school districts, water districts, fire districts; anyone who collects money who’s classified as a government entity.”

An IRS spokesperson said legal issues prevented her from discussing the validity of Crockett and Little’s statements.

“Because of disclosure laws, I can’t confirm or deny investigations that are either in progress, contemplated or completed,” she said.

Crockett said the agent’s interest in use of county vehicles did not necessarily mean there was abuse.

As of Friday, he said, the county had not received any further word from the IRS.

“Until we get that, nobody really knows,” he said.

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