By Ryan Wynne
Taxpayers with overdue state taxes may be eligible to pay them without penalties or interest under a new Washington State amnesty program.
The first-ever amnesty, authorized by the Washington State Legislature during its one-day special session Dec. 11, applies to the state business and occupation tax, public utility tax and state and local sales and use taxes ― it doesn’t affect municipal taxes.
The amount businesses owe the state has grown during the recession, according to Mike Gowrylow, communications director for the Washington State Department of Revenue (DOR).
“Even in good times we have back taxes. There’s always someone who is not going to pay their taxes,” he said, but there are more people with unpaid taxes now.
Approximately 50,000 businesses owe the state taxes, Gowrylow said, and the department projects about 10,000 of them will pay during the amnesty period.
While this will benefit those who owe, the program is primarily intended to help the state generate money to balance the budget, Gowrylow said. The state would eventually get these taxes anyway, but this speeds up the process and saves the department time and labor, he said.
The program is expected to generate $24.4 million for the state and $3.9 million for local governments during current fiscal year.
Both registered and unregistered businesses can take advantage of the program and the DOR also hopes the program prompts unregistered businesses to register, Gowrylow said.
“It’s much easier for everyone if it happens voluntarily,” he said.
Qualifying taxpayers can apply for the program from Feb. 1 to April 18, and must pay back taxes by April 30.
Taxpayers are excluded from this program if they: have ever been assessed a penalty by the DOR for evasion or misuse of a reseller permit or resale certificate; are in bankruptcy and payment of tax debt would violate federal bankruptcy laws; or if they have ever been prosecuted for failing to pay or collect the proper amount of any tax administered by the DOR under RCW 82.32. All other taxpayers can participate, Gowrylow said.
Those who owe should jump on the train while it’s still in the station: this will likely be a one time offer, Gowrylow said.
The Department of Revenue expects to have the application procedures ready by mid January. For more information, visit dor.wa.gov/amnesty or call (800) 647-7706.