Arizona Enacts Tax Amnesty Program
Author: Bob Johnson Jr
The Arizona Department of Revenue (DOR) has created a tax amnesty program for all state and local taxes it administers, with the exception of luxury and withholding taxes.
The amnesty program will run September 1, 2015, through October 31, 2015. Taxpayers filing returns annually may report taxes due through the period ending on or before December 31, 2013; all other taxpayers may report taxes due through January 31, 2015. Participating taxpayers will receive a waiver for all civil penalties and interest and be excluded from administrative, civil or criminal action for the periods covered by the program.
Taxpayers wishing to participate in the amnesty program must apply on the DOR-prescribed form, file applicable tax returns for each taxable period for which amnesty is requested and pay the entire tax balance due by October 31, 2015.
Taxpayers do not qualify for the amnesty program if any of the following apply:
- The taxpayer is a party to any criminal investigation or any criminal administrative proceeding or criminal litigation pending on January 1, 2015, in any U.S. or Arizona court for failure to file or failure to pay, or for fraud with respect to, any tax imposed by the state and required to be collected by the department.
- The taxpayer has been the subject of a past tax-related criminal investigation, indictment or prosecution if the investigation, indictment or prosecution resulted in a conviction, a guilty plea or a plea of no contest.
- The taxpayer has been convicted of a crime related to any period or assessment of a tax that is the basis of the penalty or interest for which recovery is sought.
- The taxpayer is a party to a closing agreement with the DOR for the tax periods included in the recovery application.
- The taxpayer submits an application for recovery that does not include the full unpaid tax amount.
Taxpayers participating in the amnesty program waive all administrative and judicial rights of appeal that have not run or otherwise expired as of the date of amnesty application. In addition, a taxpayer approved for the amnesty program will have any action or proceeding before the Arizona Board of Tax Appeals or any other court dismissed upon that body receiving notification that taxable period has been approved under the amnesty program. A taxpayer filing an application for amnesty retains all administrative and judicial rights of appeal for any subsequent DOR audits.
If you have unpaid Arizona taxes, you should consider the benefits of participating in the amnesty program in September and October 2015 to become compliant and avoid paying penalties and interest. For more information on the program, or for assistance determining whether you qualify, contact your BKD advisor.