States Offering Tax Amnesty Programs
Source: Bureau of National Affairs
Amnesty Programs Proliferate
Most state governments are facing record revenue shortfalls, and tax amnesty is in vogue. Seven states are currently offering either amnesty or voluntary disclosure programs for taxpayers. Under these programs, taxpayers disclose any taxes they owe, and part or all of the penalties are waived. Interest payments may be reduced under the programs as well. Amnesty generally does not apply for taxpayers already being investigated or participating in a payment program.
Arizona: The amnesty, effective May 1, 2009, through June 1, 2009, applies to taxes due on or after Jan. 1, 2002, but ending before Jan. 1, 2008. Withholding taxes are included. Taxpayers must pay the total due for all amnesty periods by June 1, 2009. Civil penalties will be waived and interest reduced to 3 percent per year.
Connecticut: The amnesty is effective May 1, 2009, through June 25, 2009, and applies to taxes owed for any taxable period ending on or before Nov. 30, 2008. Withholding taxes are included. Taxpayers must pay all taxes due, and penalties will be waived and interest reduced.
New Jersey: The amnesty is effective from May 4, 2009, through June 15, 2009, and applies to tax liabilities for returns due on or after Jan. 1, 2002, and before Feb. 1, 2009. Withholding taxes are included. All penalties will be waived and one-half the interest due, provided all tax and one-half the interest is paid during the amnesty period.
Virginia: The state legislature has passed a bill authorizing a tax amnesty lasting from 60 days to 75 days sometime during the fiscal year (July 1, 2009, through June 30, 2010), although the Tax Department has yet to announce details. Withholding taxes will be included. Under the amnesty, all penalties and one-half of the interest will be waived if the taxpayer pays the tax and half the interest due.
Both the District of Columbia and New York state have programs under which taxpayers can voluntarily disclose unpaid taxes and receive waivers of penalties. In the District, the Voluntary Compliance Program waives penalties if all taxes and interest owed are paid in full. The program also limits the lookback period to the lesser of three years or the date when the taxpayer established business in the District. New York's Voluntary Disclosure and Compliance program applies to all taxpayers. Taxpayers tell the department what taxes they owe, pay the taxes, and enter an agreement to pay all future taxes. In return, penalties are waived and criminal charges not pursued.
In Massachusetts, the amnesty applies only to individual taxpayers who receive a special amnesty tax bill. The program runs from March 1, 2009, through April 30, 2009, and applies to tax liabilities for tax years ending on or before Dec. 31, 2007.
Amnesty Programs Proliferate
Most state governments are facing record revenue shortfalls, and tax amnesty is in vogue. Seven states are currently offering either amnesty or voluntary disclosure programs for taxpayers. Under these programs, taxpayers disclose any taxes they owe, and part or all of the penalties are waived. Interest payments may be reduced under the programs as well. Amnesty generally does not apply for taxpayers already being investigated or participating in a payment program.
Arizona: The amnesty, effective May 1, 2009, through June 1, 2009, applies to taxes due on or after Jan. 1, 2002, but ending before Jan. 1, 2008. Withholding taxes are included. Taxpayers must pay the total due for all amnesty periods by June 1, 2009. Civil penalties will be waived and interest reduced to 3 percent per year.
Connecticut: The amnesty is effective May 1, 2009, through June 25, 2009, and applies to taxes owed for any taxable period ending on or before Nov. 30, 2008. Withholding taxes are included. Taxpayers must pay all taxes due, and penalties will be waived and interest reduced.
New Jersey: The amnesty is effective from May 4, 2009, through June 15, 2009, and applies to tax liabilities for returns due on or after Jan. 1, 2002, and before Feb. 1, 2009. Withholding taxes are included. All penalties will be waived and one-half the interest due, provided all tax and one-half the interest is paid during the amnesty period.
Virginia: The state legislature has passed a bill authorizing a tax amnesty lasting from 60 days to 75 days sometime during the fiscal year (July 1, 2009, through June 30, 2010), although the Tax Department has yet to announce details. Withholding taxes will be included. Under the amnesty, all penalties and one-half of the interest will be waived if the taxpayer pays the tax and half the interest due.
Both the District of Columbia and New York state have programs under which taxpayers can voluntarily disclose unpaid taxes and receive waivers of penalties. In the District, the Voluntary Compliance Program waives penalties if all taxes and interest owed are paid in full. The program also limits the lookback period to the lesser of three years or the date when the taxpayer established business in the District. New York's Voluntary Disclosure and Compliance program applies to all taxpayers. Taxpayers tell the department what taxes they owe, pay the taxes, and enter an agreement to pay all future taxes. In return, penalties are waived and criminal charges not pursued.
In Massachusetts, the amnesty applies only to individual taxpayers who receive a special amnesty tax bill. The program runs from March 1, 2009, through April 30, 2009, and applies to tax liabilities for tax years ending on or before Dec. 31, 2007.
posted by Kathleen Webb at
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