Tax Amnesty Programs—What is in it for You?

The State of Massachusetts recently instituted a tax amnesty program. Ohio had to cancel its plans for a tax amnesty program in 2023 given the state financial outlook. What do these programs offer taxpayers?

It has been years since the Massachusetts Department of Revenue (DOR) offered a tax amnesty program. This program, running from November 1, 2024 through December 30, 2024, gives taxpayers the opportunity to return to compliance and enjoy a waiver of penalties where eligible.

Regardless of the state you live in, failing to file a tax return on the state or federal level usually incurs penalties and interest if taxes are owing. The Massachusetts tax amnesty program is unusually broad and extends eligibility to individuals, trusts, estates, and corporate interests.

In Ohio, a 2023 measure signed by Governor DeWine authorized a tax amnesty program. That said, In the long run, the Ohio Office of Budget and Administration determined the amnesty program was not feasible for the state.

For taxpayers or business owners, tax amnesty programs can be helpful in several ways. Consider:

• Business owners may be able to take advantage of program relative to sales tax on meals, withholding taxes on wages, and sales and use taxes.
• Tax amnesty programs offer state and federal agencies the opportunity to collect due taxes without the expense of a tax investigation or audit. Generally, taxpayers and companies already under compliance review are not eligible for amnesty programs.
• For taxpayers, amnesty programs provide the opportunity to regain compliance without fear of prosecution or additional penalties. Tax amnesty programs offer a mix of penalty relief—fines or interest may be reduced or waived.

In Ohio, there is also a Voluntary Disclosure program for individual and other taxes that could offer a road to compliance if you are eligible.

For those in Ohio, it is worthwhile to find out if your city might offer a tax amnesty program. The City of Carlisle is currently running a tax amnesty program until November 30, 2024. Taxpayers who have unpaid local taxes from years 2018 through 2023 may be able to see fines and interest waived on their tax obligation.

If you are eligible for a tax amnesty program, give it serious thought. Tax amnesty programs usually have a time limit for submissions. If you have concerns or questions about amnesty programs, potential tax fraud, or disclosures, speak with a knowledgeable tax attorney before you file.

Speak with experienced tax attorneys providing domestic and international representation

If you are concerned about compliance, an offshore tax question, or allegations of tax fraud, Robert J. Fedor, Esq., LLC can help. We deliver seasoned, strategic tax guidance in the U.S. and abroad with offices in Chicago and Cleveland. Call us at 440-250-9709 or contact us online.