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Paris council authorizes representation after IRS penalty notices over ACA reporting
Summary
Council adopted a resolution delegating authority to the city manager to execute IRS Form 2848 so TML‑hired counsel can negotiate penalties related to late/missing ACA reporting; staff estimated the city's one‑year penalty at about $89,000 and said TML will pursue recovery from the third‑party filer.
The Paris City Council on Sept. 3 adopted a resolution authorizing representation in an IRS matter and delegating authority for execution of IRS Form 2848 (power of attorney) to the city manager so counsel hired through the Texas Municipal League (TML) can represent the city in negotiations over Affordable Care Act reporting penalties.
City manager Gene explained that TML had assisted cities with ACA reporting filings and that a third party used by TML failed to file certain returns in a timely manner. As a result, cities including Paris received IRS penalty notices. Gene said, "a bunch of cities, including the City of Paris, have gotten a penalty notice from the IRS" and that the city’s penalty in the notice for one year is about $89,000 (as discussed on the dais). He said TML has met and has engaged a law firm to negotiate on behalf of the pool.
The council moved to adopt the resolution, it was seconded, and the Chair called for all in favor; the motion passed by voice vote on the record in the meeting transcript. No roll‑call tally or recorded individual votes appeared in the transcript.
Why it matters: The penalty notices stem from employer‑reporting obligations under the Affordable Care Act; the resolution authorizes the manager to sign a power of attorney so outside counsel can negotiate with the IRS on the city’s behalf. Gene indicated the pool (TML) will attempt to recover amounts from the third party that allegedly failed to file in a timely way, but the transcript does not record the final outcome of that recovery effort.
Next steps: With the resolution adopted, TML’s counsel will proceed with negotiations and Paris staff will continue to monitor the matter; the council did not receive a final dollar recovery or a guarantee that the third party will reimburse the pool in full.
Ending: The council approved the resolution and then moved to adjourn.
