Accounting Error Shortchanges Counties $206M

Posted On April 05, 2012

(Indianapolis, Ind.) – Indiana’s second multi-million dollar accounting error in five months is leading questions to be asked at the state Department of Revenue.


Officials announced Thursday that a programming error was discovered with the state’s distribution of local option income tax to counties. The amount: $205 million.


Ninety-one of Indiana’s 92 counties – Lake County does not collect LOIT – have been receiving about $13 million per month less than they should have since January 2011.


“The report failed to capture the amounts due to counties from individual taxpayers who separated their state and county estimated payments when remitting quarterly income tax estimates. Consequently, local option income taxes were under-distributed and State General Fund revenues were overstated,” a statement from the OMB said.


Governor Mitch Daniels directed the OMB to immediately distribute the funds to each county, with interest.


According to data from the state budget agency, Dearborn County will receive $584,198.33. Franklin County will get $638,581.98; Ripley County $672,479.72; Ohio County $75,830.20; and Switzerland $92,959.33. The amounts are without interest.


The OMB said a similar error occurred in 1998.


The error was found by the DOR’s Office of Management and Budget. The department has hired an outside auditor to review its operations.


Thursday’s discovery means the Department of Revenue has misplaced over a half-billion dollars in five months.  In December, $320 million in corporate taxes paid by electronic check were found sitting in an account since 2007.




Ind. Finds Computer Error, $300M