Multi-State Tax Law Blog
The Rhode Island legislature has passed a bill, which has been signed into law, allowing for a limited time tax amnesty program. Beginning on December 1, 2017, and lasting until February 15, 2018, taxpayers will have the ability to come clean on their tax liability. While tax will still be due, interest will be reduced by 25% and penalties will be waived. More importantly, the Department of Revenue will not attempt to impose civil or criminal sanctions against the disclosing taxpayer!
Amnesty programs are not always available. When they do come around, you need to carefully consider whether amnesty is right for you. While paying the back taxes can be a major drawback, it would be even worse to be charged with a crime. Consider the pros and cons when weighing how to proceed. It is also a good idea to figure out your exposure in the state before incurring the costs to disclose. It could end up being more expensive to disclose than to pay whatever is assessed by the state. Thus, you could have a good case for not disclosing based solely on costs.
Remember, some states keep their statute of limitations open for civil claims of back taxes against a taxpayer until something is done to trigger the running of the statute of limitations. Most of the time, filing returns can trigger the statute of limitations to begin running. Keep the statute of limitations in mind when figuring your total exposure and acceptable risk. This framework could help you determine exactly what to do.
A copy of the law can be found here.
About the Author: Gerald “Jerry” Donnini II is a partner of the Law Offices of Moffa, Sutton, & Donnini, P.A. Mr. Donnini concentrates in the area of Florida and Federal tax matters, with a heavy emphasis on the tobacco, convenience store and petroleum industries. He also handles a myriad of multi-state state and local tax issues. Mr. Donnini is a co-author for CCH’s Expert Treatise Library: State Sales and Use Tax and writes extensively on multi-state tax issues for SalesTaxSupport.com.
ADDITIONAL ARTICLES TO READ
ANOTHER TAX AMNESTY FOR AMAZON FBA SELLERS IN THE WORKS?, published November 26, 2017, by Jerry Donnini, Esq.
THE VOLUNTARY DISCLOSURE PROGRAM, published October 11, 2017, by Jerry Donnini, Esq.
STATES OFFER AMNESTY FOR FBA AMAZON PRORGAM, published August 13, 2017, by Jerry Donnini, Esq.
Tennessee Jumps on Economic Nexus Train, published March 13, 2017, by Jerry Donnini, Esq.