For taxes administered by the Pennsylvania Department of Revenue (DOR), the House of Representatives has passed a bill to authorize a tax amnesty. The measure has gone to the Senate for its approval.
The amnesty period would be 60 consecutive days during the 2016-2017 fiscal year and would start no later than 120 days after the effective date of the measure. Any taxpayer that would participate in the amnesty program would be ineligible to participate in a future tax amnesty program. Participation in the program is conditioned upon the taxpayer’s agreement not to protest or pursue any administrative or judicial proceeding or a refund claim with regard to tax amnesty returns.
An “eligible tax” for purposes of the bill would be any tax administered by the DOR that is delinquent as of December 31, 2015. The term includes any penalty or interest on an eligible tax. For an unknown liability, the term would only include taxes due within five years prior to December 31, 2015. For International Fuel Tax Agreement (IFTA) purposes, the term only applies to taxes, interest, and penalties owed to Pennsylvania.
During the amnesty period, participants would be required to:
– file a tax amnesty return;
– pay all taxes and half of the penalties due to the state (no payment of penalties would be required); and
– file complete tax returns or, for previous underreporting, amended tax returns for all required years for which the taxpayer previously has not filed.
Generally, the DOR may not collect any penalties or interest waived during the program period unless the taxpayer who is granted amnesty, within two years after the end of the program, becomes delinquent in payments:
– for three consecutive periods without contesting the assessments; or
– is eight or months late in payment of taxes due.
H.B. 1888, as passed by the Pennsylvania House of Representatives June 21, 2016