Comptroller Reminds Taxpayers: Tax “Do Over” Deadline, One Month Away

ANNAPOLIS, Md. (September 30, 2009) - Maryland Comptroller Peter Franchot reminded taxpayers today that the deadline for the state’s tax amnesty is approaching and ends October 30. Tax amnesty gives delinquent taxpayers one final opportunity to pay their Maryland tax liability with only one half of the interest owed and no fear of criminal prosecution.

“I remind delinquent taxpayers that they only have one month left to take advantage of this rare opportunity and clean the slate with the state,” Comptroller Peter Franchot said.

Since amnesty began on September 1, 2009, the Comptroller’s office has received more than 4,500 calls and has had more than 1,200 people take advantage of the program, either setting up payment plans or paying the liability in full. Thus far, nearly $2.2 million has been received in back tax and interest.

Taxpayers who fail to take advantage of this amnesty period face fines and possible jail sentences if they have not reported, paid, or under reported their tax liabilities prior to December 31, 2008. Previously assessed fraud penalties will not be waived.

Taxpayers who qualify for the program include those who have failed to file a return or pay eligible tax liabilities due on or before December 31, 2008, or have underreported taxes due on or before that date.
Taxpayers under criminal investigation by the Attorney General’s Office, a state prosecutor, or a state’s attorney are not eligible for
amnesty from criminal prosecution.

The following taxes are eligible for amnesty:

• Personal Income Tax
• Employer Withholding Tax
• Corporate Income Tax
• Sales and Use Tax
• Admissions and Amusement Tax

Under this program, approved participants will have half the unpaid interest waived on their outstanding liability along with all unpaid civil penalties. Taxpayers can either pay the entire amount in full immediately or set up a payment plan that must be settled by December 31, 2010. Full payments can be made by Amnesty BillPay, credit card, check or money order. Taxpayers taking advantage of the payment plan option must include a 10 percent down payment and expect future payments to be direct debited from their bank account.

Taxpayers who participated in the last tax amnesty are not eligible for this year’s program for the same tax type. Businesses with more than 500 employees in the United States or that are members of a corporate group with more than 500 employees in the United States are also not eligible. Additionally, businesses eligible for the July 1, 2004 through November 1, 2004 settlement period as provided in Chapter 557 of the Acts 2004, can not be granted amnesty.

Previous tax amnesty periods were held in Maryland in 1987 and 2001.
During the last amnesty program, the Comptroller’s office collected $39.4 million. Legislative analyst project this year’s program will bring in $5-10 million for the state’s general fund. Currently, Delaware, Louisiana, Maine, Oregon and Virginia are also holding amnesty campaigns.

“Maryland taxpayers should have no expectation that amnesty will be offered again,” Comptroller Franchot said. “Delinquent taxpayers should come forward and take advantage of this limited opportunity,” he added.

To obtain a tax amnesty application and other tax forms, visit www.marylandtaxes.com or call 410-260-7980 from central Maryland, or 1-800-MD-TAXES from elsewhere. The agency’s Web site also features an interactive tax amnesty interest calculator to help determine the amount of tax owed. Taxpayers with an outstanding liability can also use the notice number on bills up to six months old to determine their amnesty liability through the agency’s Amnesty BillPay application.

In person help is available at the agency’s 11 local offices. A list of offices can be found on the Comptroller’s Web site. On October 30, the program’s final day, the Comptroller’s field offices in Hagerstown, Salisbury Wheaton, Baltimore and Annapolis will be open until 8 p.m. and extended phone coverage will be available.