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Connecticut Amnesty Program Established By House

Connecticut House Bill HB 6704 was passed June 4, 2013 and includes authorization of an amnesty program to be established by the Department of Revenue Services (DRS).  The program would start September 16, 2013 and run through November 15, 2013.  The program will cover all Connecticut taxes except motor carrier road taxes and will cover any tax period ending on or before November 30, 2012.  Governor Dan Malloy’s 2014-2015 biennial budget, SB 843 introduced in January 2013, also included amnesty provisions and some amnesty revenue expectations.  Therefore if a bill gets to his desk it is assumed it will be signed.

The DRS Commissioner will have wide authority to implement the program starting with creating an amnesty application.  Some specific provisions of the amnesty program are:

  1. Payment of all taxes owed for the amnesty period through November 30, 2012 must be made by November 15, 2013.
  2. Civil penalties and criminal prosecution will be waived.
  3. Interest on any taxes paid within the amnesty period will be 25% of the normal charge, generally 1.0% per month.
  4. Some exclusions from the program exist--such as, if an audit has progressed to a closing agreement or a compromise offer has been made.  The treatment of taxpayers otherwise currently under audit is unclear
  5. Failure to timely file an amnesty application or include all taxes owed for the amnesty period will cause a 25% penalty to be imposed with no possibility of waiver plus all other applicable interest and penalties on all post-amnesty payments.
  6. No portion of any amnesty tax payments erroneously paid will be refunded.

Similar to other state amnesty programs, we encourage any entities with outstanding Connecticut tax liabilities to evaluate the benefits of participating in this program.

To read more about the bill, please click here.

 

Gary Bingel's expertise focuses on state and local income taxation, and sales and use tax consulting. He has significant experience serving clients in the manufacturing, retail, pharmaceutical, biotechnology, technology and service industries.

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