Minneapolis Public Schools (MPS) has been hit with $5.3 million in IRS penalties over the past four years, and has paid $770,500 to the federal government in an effort to reduce the charges. The penalties were mentioned in an investigative report regarding the district's withholding of nearly $3 million of employee and district contributions to a health-insurance trust fund. The district is working with tax specialists and staff with the Center for Effective School Operations to prevent future tax penalties. These penalties include $2.9 million for errors in employment taxes in 2023, 2024 and 2025, and $3.5 million for late filing of employee wage statements and health coverage information.