Ohio General Tax Amnesty Ends June 15 – Up Next: Texas and Kentucky

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Whether a business is looking to reduce its tax exposure or an individual is looking for some piece of mind, state and local tax amnesty programs can be a real opportunity for some taxpayers. The programs are designed to bring immediate cash flow to state budgets in exchange for limiting the tax, penalties and interest of participating taxpayers.

In addition to general tax amnesty programs offered in Ohio, Texas and Kentucky, many state and local governments have more targeted programs.

The benefit of each state's tax amnesty program will vary. In addition, each state will have its own specific procedures and application period for its tax amnesty program. In some cases, states will increase penalties and interest for taxpayers who fail to participate in an amnesty program and are later assessed liability for the periods covered by the amnesty.

Taxpayers should consider their particular circumstances as well as the relative benefits of voluntary disclosure programs that may be available simultaneously with the tax amnesty program.

General summaries of a number of tax amnesty programs are provided below.

Ohio - General Tax Amnesty Ending June 15

Taxes Covered Include:Commercial Activity Tax (CAT)

Corporation Franchise Tax

Individual Income Tax

Sales and Seller's Use Tax

(Not Consumer's Use Tax - see below)

Employer Withholding

Pass-Through EntityTax Periods: All periods where the tax was due and payable as of May 1, 2011.

(Note: This tax amnesty does not cover liabilities accrued since May 1, 2011)

Taxpayers:Anyone who has a liability for the taxes listed above as of

May 1, 2011, but amnesty cannot be claimed for taxes that are

currently under audit or for which a notice of assessment has

been issued.Benefits:Forgiveness of all the penalty and half the interest associated

with unreported and underreported taxes that qualify under the

program.When to Apply:The application period began May 1 and will run through

June 15, 2012.Voluntary Disclosure

Program Available:Commercial Activity Tax (CAT)

Corporation Franchise Tax

Individual Income Tax

Sales and Use Tax

Employer Withholding

Pass-Through Entity

Texas Fresh Start Amnesty - Apply June 12 to August 17

Taxes Covered:All state and local taxes and fees administered by the

Comptroller's office are eligible, with the exception of Public

Utility Commission gross receipts assessments.Tax Periods:All periods with returns due before April 1, 2012.Taxpayers:Taxpayers who did not file or underreported taxes or fees. The

amnesty does not apply to underpayments or to taxpayers who

have been or are currently under audit.Benefits:Waiver of all penalties and interest on returns filed that request

amnesty.When to Apply:The application period runs from June 12 through

August 17, 2012.Voluntary Disclosure

Program Available:Applies to all taxes administered by the Comptroller, as well as

unclaimed property.

Kentucky Amnesty Legislation Passed - Program to Be Offered Before June 30, 2013

Taxes Covered:All taxes administered by the Department of Revenue except

real property, motor vehicle and personal property taxes.Tax Periods:Taxable periods ending or transactions occurring after

December 1, 2001, and prior to October 1, 2011Taxpayers:Any taxpayer who files original or amended returns, pays all

amounts owed in full, and continues to file and pay on time for

three years. Amnesty is invalidated if payments are not made as

required. A taxpayer may participate even if under audit, but

must waive the right to dispute any tax for which amnesty is

sought.Benefits:Waiver of all penalties and half the interest due (except certain

penalties pertaining to cigarettes). Interest is not waived during

an installment agreement. Avoid a 2% increase in interest and

collection fees of up to 75% on a liability that could have

received amnesty but is collected after the amnesty period.When to Apply:The Department of Revenue will announce a 60- to 90-day

period before June 30, 2013.Voluntary Disclosure

Program Available:For any tax administered by the Department of Revenue.

Other Amnesty Programs

Georgia:Amnesty for sales and use tax liabilities for registration prior to

August 1, 2012.Indiana:Counties may, before July 1, 2012, adopt an ordinance to

establish a property tax amnesty program for delinquent taxes

and special assessments applicable to real property. The

ordinance would allow for waiver of interest and penalties added

before January 1, 2012.Maine:Consumer use tax amnesty to run from October 1 to

November 30, 2012 for use tax incurred before January 1, 2006.Ohio:Consumer use tax amnesty available until May 13, 2013 for

purchases made on or after January 1, 2009.Tennessee:Sales and use tax amnesty to sellers that are not currently

registered and who volunteer to collect or pay sales or use

taxes. This amnesty is available until 12 months after

Tennessee becomes a full member of Streamlined Sales and

Use Tax.Utah:Amnesty for sales and use tax liabilities prior to registration. This

amnesty is available until 12 months after Utah becomes a full

member of Streamlined Sales and Use Tax.Washington:Personal property tax amnesty available until July 1, 2012 for

tax years 2011 and prior.

If you have questions about tax amnesty, voluntary disclosure or other state and local tax issues feel free to contact Kristina E. Somers or any other member of the Reinhart State and Local Tax team.


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