UPDATE: The Connecticut Tax Amnesty Program is currently expired.
If your business has been tagged with an existing tax liability to the State of Connecticut, you have hopefully seen the notices of the newest CT Tax Amnesty Program. If you haven't wanted to see the bills and have left the envelopes unopened, you may not yet know that this is an excellent opportunity for you to solve any back tax issues you may have with your business, as well as with your personal taxes.
Somebody's got to pay for that golden dome.
The good news about the Connecticut Tax Amnesty is that you can take advantage of it to solve many different types of Connecticut back tax issues. In addition to the largest category, personal income taxes, businesses can also apply the amnesty to back business use taxes, corporation business tax, motor vehicle fuels tax, sales and use taxes and withholding taxes.
While taxpayers who seek tax amnesty with the State of Connecticut must file their application electronically, the preparation could be complicated enough to get help from a tax attorney beforehand to make sure the process goes smoothly. The time to submit the application is limited, with the deadline being November 15, 2013. In offering this amnesty program, the State of Connecticut has both a reward for compliance and a penalty for failure to pay up in store for the taxpayer.
The Reward: Actually a set of rewards, starting with 75 percent off of all accumulated interest on the back taxes owed. In addition, all penalties will be waived for both individuals and business that have either not filed at all, have underreported their income or who have any state tax liabilities with ending period dates before November 30, 2012.
The Penalty: This is new. For those who do not take advantage of the amnesty program and do not pay their back taxes by the November 15 deadline there are two results the Department of Revenue Services has in mind. The first is a 25 percent penalty that will be added to all the previous unpaid taxes and penalties that the taxpayer has accumulated. The second is criminal prosecution—or both.
The CT Tax Amnesty Program is aimed not only at giving back-taxpayers a break on what they owe.
The other goal is to raise more than $35 million to use toward balancing the state budget. With the wide number of categories of back taxes available for taxpayers to apply the amnesty to, it is possible they'll make their goal as well! It's clearly an attempt at a win-win situation for both the state and the taxpayers.
