JOHNSTOWN — The Town Board has tasked Town Attorney Leah Everhart with researching whether or not it should count $100 boot stipends paid to county highway workers as taxable income.
Town Board Member Tim Rizzo first raised the issue after doing some research during which he determined other municipalities have been required by the U.S. Internal Revenue Service to consider stipends for boots and other non-safety related equipment as being taxable income on an employees W-2 tax form, which the town of Johnstown has not been doing. Rizzo said believes other town officials were skeptical of his critique of the town’s accounting practices, but now he feels vindicated.
This is the second accounting practice Rizzo has questioned.
“They hollered at me and gave me grief two months ago about this, but now they find out they were wrong and now they’re going to fix it,” Rizzo said. “According to the IRS 2014 Fringe Benefits, you can find it online, it’s free, on page 65, there’s a little paragraph that talks about boot allowances.”
The annual stipend currently paid to 11 county highway employees costs the town $1,100.
Town Supervisor Jack Wilson said the town will comply with whatever the rules are.
“We have agreed that, if our attorney gets back to us and says that’s correct, then beginning with their W-2s next year they will be included in [it]. Anything other than that, we have a union contract with those people. It will all have to go through the union contract,” Wilson said. “If that’s the requirement that’s what will be done. We’re following through to see if it’s legitimate. Our attorney is looking into it. There are three or four different interpretations on it, if it comes back and Tim is correct then indeed it will be fixed. It’s petty. My position is it will be done the correct way.”
Rizzo said he continues to believe some accounting issues are not being executed properly with the town government. He said he will continue to push for the possibility of a referendum to require the town purchase a time clock system to provide greater statistical data for the town’s employees.