Scarsdale Schools Resolve $1.8 MM IRS Drama Talk of the Sound

SCARSDALE, NY (September 5, 2022) — In the end, the District is out about 500 bucks over its IRS Tax Penalties that led the Board of Education to oust Dr. Thomas Hagerman in June.

At the Scarsdale Board of Education on August 22, 2022, Interim Superintendent of Schools Dr. Drew Patrick announced that despite all the weeping and gnashing of teeth since March 2022, the District has mostly squared its account with the IRS and will be out a measly $442.00.

What they are saying;

Interim Superintendent of Schools Dr. Drew Patrick:

“The first item pertains to the IRS matter, where there have been several positive developments. For purposes of clarity, this update focuses on the bottom line outcomes and avoids some of the more arcane detail:

“First, regarding the District’s Q1 2020 Form 843 request for abatement and claim for refund, the District did receive a check from the IRS in July 2022 in the amount of $744,196.44. Of this amount, $714,168.71 represents penalties that had been abated in full and $30,027.73 represents the payment of interest owed by the IRS to the District.

Next, regarding the District’s Q3 2020 Form 843 request for abatement and claim for refund, the District has been notified by the IRS that a refund in the amount of $100,243.55, representing penalties that have been abated is due to the District. The District’s tax attorneys are continuing to follow up with the IRS on the status of that refund check.

“Therefore, once the District receives this remaining $100,243.55 refund check from the IRS, the District will have recovered and received abatements and refunds of penalties in the substantial amount of $844,000, which is essentially a full offset of the $843,558 Q4 2020 tax payment that that Board authorized on March 30, 2022 and that the District paid to the IRS shortly thereafter.

“The District has been notified by the IRS Independent Office of Appeals that all penalties assessed and interest associated therewith in Q4 2020, totaling approximately $534,000, have been fully abated, the Collection Due Process hearing is now complete, and the lien against the District should self-release within approximately 30 days.

“Finally, the penalty assessed against the District in Q2 2021, in the amount of $412,837.45 plus applicable interest has been abated in full.

“Thus, once the District receives the Q3 2020 $100,243.55 refund check from the IRS, the District will have recovered and/or abated substantially all of the approximately $1.8M in penalties and interest assessed against it.”