The Pennsylvania Department of Revenue has instituted a 54 day Tax Amnesty Program through June 18, 2010. All individuals, businesses and other entities with Pennsylvania tax delinquencies as of June 30, 2009 are generally eligible to participate in the Amnesty Program. Non-filed tax returns, as well as unpaid, under-reported, or un-established taxes, whether known or unknown to the Department of Revenue, constitute eligible delinquencies. To participate, taxpayers will need to file an online amnesty return, file all delinquent tax returns and make the required payment before June 18, 2010. All penalties and one-half of the interest due will be waived. Payments for taxes due after June 30, 2009 are not eligible for participation in the Amnesty Program.

As an additional incentive to come forward, taxpayers with liabilities unknown to the Department of Revenue prior to their amnesty return, and who complete the program, will not be liable for taxes of the same type prior to July 1, 2004. Normally, there is no statute of limitations for unfiled tax returns.

In order to participate, a taxpayer must follow the procedure proscribed by the Department of Revenue. A participant must file an online Amnesty Return at the website, www.PATaxPayUp.com. Paper filings will not be accepted. The taxpayer must pay all taxes and one-half of the interest due to the Commonwealth, file complete tax returns for all required tax periods for which the taxpayer previously has not filed a tax return, and file completed amended returns for all required periods for which the taxpayer underreported its tax liability.

A taxpayer may not pursue an administrative or judicial proceeding with regard to the tax amnesty filings to claim any refund of money or otherwise. These claims are barred by participation in the Amnesty Program. A taxpayer currently possessing an active administrative or judicial appeal is eligible to participate in the Amnesty Program, but in order to receive the benefits of the Amnesty Program, the taxpayer must withdraw active administrative or judicial appeals relating to periods accepted into the Amnesty Program.

There are also limitations on eligibility. For example, taxpayers under criminal investigation or who have been named in a criminal complaint alleging a violation of Pennsylvania tax law are ineligible for the Amnesty Program.

The Department of Revenue may re-impose all penalty and interest abated during the Amnesty Program if within 2 years of the conclusion of the Amnesty Program the taxpayer becomes delinquent in tax filing or payment.

There is a penalty for those taxpayers with outstanding tax liabilities who do not participate in the Amnesty Program. At the conclusion of the program, a 5% non-participation penalty will be imposed on all tax, penalty and interest not paid in full during the Amnesty Program. This penalty does not apply to existing deferred payment plans. In addition, active appeals and entities in bankruptcy will not be assessed the additional 5% non-participation penalty.

If you have any further questions, the Amnesty Program’s website is available at www.PATaxPayUp.com or you can contact the attorney you work with at Williams Coulson.