I met with my boss yesterday (Sunday) morning and told him everything. He was very cool about the whole thing. He doesn't believe that the employee hasn't looked at a paystub in almost a year but he does think she's a good employee and feels that we can work with her to pay back anything she was overpaid. He will also discuss with the accountants to see if there is a way to calculate what the company overpaid in taxes and have the employee just pay that back rather than file amendments with the IRS. He said there has got to be a way to do this without all the paperwork. He said he doesn't blame anyone, but would like me to oversee the bookkeeper's duties on a quarterly basis just to make sure everything is going along as it's supposed to. I wanted to tell him that he should never have taken away the payables/payroll duties from me in the first place, maybe this never would have happened, ahem. But I didn't. Just let it lie - he was in a very foul mood. The only reason I think he didn't become more angry about this situation is because he was already dealing with a very bad situation due to one of his underlings messing up *Royally* a new file that the boss now has to take over. He's got a lot on his plate and he was pleased that I handled most of it before consulting with him on it. Yeah for good timing! So the employee is relieved on all counts, especially that our boss has agreed not to mention any of this to her manager; it's an HR issue, not a managerial issue - boss agreed.