Unpaid Employee Taxes Lead to $7,355 in Penalties, Interest at Joint Fire District

Thursday, May 4, 2017

Columbus – A former fiscal officer racked up $7,355 in penalties and interest by failing to pay employee taxes for seven years, according to an audit of the Clinton-Highland Joint Fire District (Clinton County) released today by Auditor of State Dave Yost. 

“Negligence and poor training are the most common causes of financial penalties assessed to local governments,” Auditor Yost said. “It appears both played a role in this fiscal officer’s repeated failure to carry out a fundamental duty.”

Former fiscal officer Sidney Clay withheld required employee income taxes from 2009 through 2015, but he did not properly submit the funds to the state, the City of Wilmington or the IRS. As a result, the district was charged $5,514 by the state and $1,841 by Wilmington in penalties and interest. The district is working with the IRS to determine the amount of penalties owed to the federal government.

“The interest and penalties assessed against the District serve no proper public purpose for the District and could have been avoided had the funds been remitted as required by law,” auditors wrote.

During the audit, the district paid the overdue tax withholdings to the state and Wilmington, and it is in the process of submitting payments to the IRS. 

Auditors issued a $7,355 finding for recovery against Clay for the penalties and interest charges. He paid $5,514 to the Ohio Department of Taxation on Aug. 26, 2016. The City of Wilmington waived the remaining $1,841.

On Oct. 24, 2016, Clay was indicted on 20 fifth-degree felony counts of failure to remit state income taxes withheld from an employee. He resigned from his position two months later. A pre-trial hearing is scheduled for 3 p.m. on May 30. 

A full copy of this report is available online


The Auditor of State’s office, one of five independently elected statewide offices in Ohio, is responsible for auditing more than 5,900 state and local government agencies.  Under the direction of Auditor Dave Yost, the office also provides financial services to local governments, investigates and prevents fraud in public agencies and promotes transparency in government.

Dominic Binkley
Public Information Officer