SALT Blawg – State and Local Tax
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Chamberlain Hrdlicka Blawgs
In less than two (2) months, Pennsylvania's 2017 Tax Amnesty Program will commence. Those individuals with potential Pennsylvania tax liabilities should consider taking advantage of the program, which is slated to run from April 21, 2017 through June 19, 2017. During those sixty (60) days, the Pennsylvania Department of Revenue (“Department”) will waive all penalties and half of the interest for anyone who participates.
The program applies to delinquencies existing as of December 31, 2015 – whether or not the delinquency is known to the Department. The litany of taxes eligible for the program includes:
- Agriculture Cooperative Tax;
- Bank and Trust Company Shares Tax;
- Capital Stock or Foreign Franchise Tax;
- Cigarette Tax;
- Corporate Loans Tax;
- Electric Cooperative Tax;
- Employer Withholding Tax;
- Financial Institutions/Title Insurance Company Shares Tax;
- Fuel Use Tax;
- Gross Premiums Tax;
- Gross Receipts Tax;
- Hotel Occupancy Tax (including state administered 1% local Hotel Occupancy Tax for Philadelphia and Allegheny);
- Inheritance and Estate Tax;
- Liquid Fuels Tax;
- Malt Beverage Tax;
- Marine Underwriting Profits Tax;
- Motor Carriers Road Tax, for IFTA vehicles, PA portion only;
- Motor Vehicle Carriers Gross Receipts Tax;
- Mutual Thrift Institutions Tax;
- Oil Company Franchise Tax;
- Parimutuel Wagering and Admissions Tax;
- Personal Income Tax;
- Public Transportation Assistance (“PTA”);
- Public Utility Realty Tax;
- Realty Transfer Tax, including Local Realty Transfer Tax;
- Sales and Use Tax, including Local Sales and Use Tax for Philadelphia and Allegheny;
- Surplus Lines Tax;
- Unauthorized Insurance Tax; and
- Vehicle Rental Tax.
Notably, the 2017 Tax Amnesty Program does not include Unemployment Compensation (which is administered by the Department of Labor and Industry), nor does it include any tax administered by another state, local government, or the Federal government.
Pursuant to the program, the taxpayer is responsible for paying the principal tax due, plus one-half interest. The Department will, in turn, rescind any liens or other enforcement actions for that debt; waive all penalties associated with the debt; waive one-half interest; and waive any fees (ex. lien filing fees or collection agency fees).
Along with the payment for all taxes and one-half of the interest, all missing tax returns or reports must be filed no later than June 19, 2017. However, a taxpayer with unknown liabilities reported and paid pursuant to the Tax Amnesty Program is eligible for a limited look-back period whereby the taxpayer will not be liable for any taxes of the same type due prior to January 1, 2011.
Those taxpayers who are eligible for the 2017 Tax Amnesty Program, but do not participate will be subject to a five-percent (5%) non-participation penalty. Generally speaking, individuals, businesses and other entities with state tax delinquencies as of December 31, 2015 (whether known or unknown to the Department) are eligible to participate in the program. However, any taxpayer who participated in the Department’s 2010 Tax Amnesty Program is ineligible to participate in the 2017 program. Taxpayers who have entered into Voluntary Disclosure Agreements with the Department are likewise ineligible to participate. Nevertheless, taxpayers who have entered into deferred payment agreements with the Department are eligible for the 2017 Tax Amnesty Program. Notably, a taxpayer who applies for tax amnesty forfeits all future appeal rights for liabilities paid through the program.
Business taxpayers may request a statement of account that shows all liabilities by visiting e-TIDES at www.etides.state.pa.us. Individual taxpayers may review account information, including all liabilities, by visiting the Personal Income Tax e-Services Center at www.doreservices.state.pa.us. Please contact us if you need assistance in determining whether you qualify for the 2017 Tax Amnesty Program and whether participation in the program is the right choice for you.