(This was originally featured in The Baltimore Business Journal on July 10, 2015)
The Tax Amnesty Program, which only runs from September 1 to October 31, 2015, allows businesses and individuals who have unfiled tax returns, unpaid tax debts, or previously filed inaccurate tax returns, to come into compliance with their state tax obligations. The Comptroller will waive all civil penalties (except previously assessed civil fraud penalties), abate 50% of any unpaid interest (which is normally charged at 13%), and bar future criminal prosecution for taxpayers who participate in the program. The program applies to the following taxes for returns due on or before December 31, 2014: personal income, sales and use, admission and amusement, employer withholding, fiduciary income, corporate income and pass-through entity non-resident tax. Most taxpayers (even those being audited) are eligible to participate in the program unless they participated in an amnesty program in the past.
Participating in the program is the right choice for most taxpayers with state tax issues, even if you cannot full pay the balances due. Those with federal tax issues, which usually evolve into state tax issues, should consider taking advantage of the program. Business owners and officers should consider getting their business’ into compliance because they can be assessed personally for certain delinquent business tax debts.
Taxpayers considering the Tax Amnesty Program should contact a tax professional right away to evaluate their situation. The Amnesty period will come and go quickly, and the Comptroller will have an unsympathetic ear for taxpayers who could have, but failed to enter the program.