Massachusetts has approved a tax amnesty program solely for businesses in order to encourage payment of delinquent tax debts. Businesses that pay off their entire debt during the amnesty period will have their penalties waived.
The amnesty period only lasts two months, running from April 1, 2010 to June 1, 2010.
What Taxes and Years are Included?
The amnesty program applies to tax years ending on or before December 31, 2009, and covers the following types of business tax liabilities:
- Sales/use tax (including sales tax on telecommunication services, materialman sales tax, and boat/RV sales tax)
- Meals tax (including local option)
- Withholding taxes
- Performer withholding
- Pass-through entity withholding
- Lottery annuity withholding
- Room occupancy excise tax (including local option)
- Convention center financing fees on room occupancy in Boston, Cambridge, Chicopee, Springfield, West Springfield, and Worcester
- Convention center financing surcharge for sightseeing tours, vehicle rentals in Boston, and parking in Boston Springfield, and Worcester
- Deeds excise tax
- Cigarette, cigar, and smoking tobacco excise tax
- Club alcohol beverage excise tax
- Gasoline excise and special fuels excise tax (including local option)
Who is Eligible?
Only those taxpayers who are issued a "Tax Amnesty Notice" will be eligible to apply for amnesty. In addition to receiving a Tax Amnesty Notice you must also have an unpaid tax liability for an eligible tax type, whether found by the Department of Revenue or yourself, that you are delinquent in paying. You are still eligible for amnesty if you are properly disputing the unpaid liability.
If you think that you may qualify but have not received a notice, you can contact the Massachusetts Department of Revenue at 617-887-MDOR or toll-free in Massachusetts at 1-800-392-6089.
Taxpayers that have been the subject of a tax-related criminal prosecution or investigation prior to April 1, 2010, are not eligible for amnesty. Also, any tax periods for which you have already signed a settlement agreement are not eligible for amnesty.
Penalty for Not Participating
If you are eligible for amnesty and fail to pay the full outstanding balance of tax and interest by the due date you may be charged an additional penalty, which cannot to exceed $500. You will not be subject to this penalty if you have entered into a Payment Agreement and have remained in compliance with the terms of the payment agreement during the amnesty period.
How to Apply for Amnesty
The only thing you have to do to receive amnesty under this program is pay the total tax and interest amount due for all tax years as stated on your "Tax Amnesty Notice." Once this payment is received, the state will waive all penalties previously assessed for the covered tax years (as well as any interest charged on the penalty amounts). Interest charged on tax liabilities will not be waived.
Note well that paying the liability does not mean that you are agreeing that the liability is correct nor that you are forfeiting your rights to appeal the assessment.
Due Date
The due date for payment is June 1, 2010. Payments made online through the Department of Revenue website must be received by June 1, 2010 at 5:00 PM Eastern Standard time. If you choose to mail a check or money order, your payment must be postmarked by June 1, 2010.