With Tax Day fast approaching, a number of Rhode Island state employees are set to receive yet another round of corrected tax forms after the state Department of Administration found a new problem involving the W-2s it issued.
The mishap – first reported by WJAR-TV NBC 10 on April 6 – was confirmed in an email Tuesday from Karen Greco, a department spokesperson, who wrote that the erroneous W-2Cs, or corrected W-2s, miscalculated the data for state employees’ Health Savings Account contributions.
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“The employer and employee contributions were reported separately when they should have been combined,” Greco explained.
Revised W-2Cs will go out to affected employees who have an HSA plan, Greco said, but she did not immediately confirm how many employees were affected. Greco did not answer Rhode Island Current’s inquiries about the suspected cause of the issue, how many corrected tax forms have been issued this tax season, or whether affected employees will need to amend their returns if already filed.
“While there is no Internal Revenue Service deadline for corrections, the State works as quickly as possible – regardless of where the issue falls in the tax cycle – to provide corrected information in that scenario,” Greco wrote.
The W-2C form says that, should a corrected form change a person’s total income for a given year, they may have to file an amended return.
Greco said the HSA contribution issue was identified “[a]t the end of last week.”
The HSA reporting gaffe is the latest oopsie connected to the state’s new payroll system, dubbed the Enterprise Resource Planning system, which finished its transformation late last year after a multi-year makeover that cost upwards of $90 million.
“ERP” is also a generic descriptor for significant overhauls of the software platforms used in governments and large businesses to handle functions like payroll, human resources, and contractor and vendor finance. ERP projects have a reputation for being expensive and tricky to implement well, and that has largely been Rhode Island’s experience thus far. In January, about two months after the new payroll platform went live, state employees lamented missing wages, benefits and other incorrect data in their paystubs.
Then, in February, the state needed to reissue W-2s after the tax forms used a catchall, backend label for government workers – “State of Rhode Island Umbrella Company” – for all state employees regardless of which agency or employer they actually work for. At the time, the Department of Administration acknowledged that these forms were also “populated with incorrect information” beyond the employer label.
By March, Gov. Daniel J. McKee’s administration decided to oust the department’s director, Jonathan Womer, after a round of corrected W-2C mailings was thought to have potentially exposed some employees’ Social Security numbers through envelope windows.
Greco explained via email then that W-2 distribution is typically carried out by a state vendor who is contracted to mail out the tax documents.
“However, we decided to distribute the W-2Cs through the State’s mailroom to ensure the forms could be delivered faster,” Greco wrote in a March 6 email. She said all former and current state employees who received 2025 paychecks from the state would be offered credit monitoring as a precaution.
The troubles have continued into the post-Womer era. WPRI-TV CBS 12 reported in late March that the state was working to correct a “$220,000 payment error that resulted in 9,000 state workers receiving union dues rather than those funds going directly to their labor groups.”
The state attributed the goof to “human error,” according to WPRI.
Alexander Castro is a staff writer with the Rhode island Current.
