UPI Failed to Pay Payroll Taxes in 4th Quarter 1984

United Press International, the financially beleaguered international news agency, revealed Friday that it failed to pay its payroll taxes in the fourth quarter last year, the same quarter for which it reported its first profit in 20 years.

The announcement came after the Internal Revenue Service filed a lien on UPI’s assets Friday morning in Nashville, Tenn., seeking payment of $1.77 million in back payroll taxes.

UPI said that it had reached an agreement Thursday with the IRS to pay the taxes, with interest, in installments, and that the lien was a way of protecting the government if UPI did not keep that agreement. IRS spokesman Eric Roberts declined to give further details.

The revelation raised new questions about the much publicized $1.1-million profit that UPI reported for the fourth quarter of 1984. The profit indicated that UPI management had made good on a promise to employees in October, when it had negotiated pay cuts of up to 25% on the assurance that the concessions would give UPI financial viability.

UPI spokesman Bill Adler said Friday that the unpaid taxes did not figure in the fourth-quarter profit because they were factored in when the company was doing its fourth-quarter accounting.

“We booked the taxes. They just weren’t paid on time” because of other obligations, Adler said. The company has unpaid bills of at least $25 million.

Yet some creditors, and even UPI executives at the vice presidential level, had told The Times in February that they were skeptical about the fourth-quarter profit.

Jules Teitelbaum, an attorney serving as chairman of a creditors committee now involved in a financial reorganization of UPI, said Friday that he could not confirm the company’s statement.

“I don’t know,” he said when asked if UPI would have had a profit if it had paid the taxes. “We’re just getting our accountants into it now.”