The New Jersey legislature may enact a law that would create a tax amnesty program for New Jersey taxes.  If enacted, the amnesty program would not exceed 45 days or end later than June 15, 2018.  Under the amnesty program, a taxpayer who previously failed to pay New Jersey tax could pay the deficiency and only half the accrued interest by May 1, 2018.  Eligible taxpayers, however, who choose not to participate in the amnesty program would be subject to an additional 5% penalty.  In addition, participating taxpayers would not be subject to civil or criminal penalties related to the New Jersey taxes.

The amnesty program, however, would only apply to New Jersey tax returns due between February 1, 2009 and January 1, 2018.  Taxpayers under criminal investigation for a New Jersey tax matter would not be eligible for the program.  If New Jersey enacts the amnesty program, it will be a good opportunity for taxpayers to address outstanding New Jersey tax issues.

The Pennsylvania Department of Revenue this week will start mailing “non-participation penalty assessments” to delinquent taxpayers who failed to participate in the 2017 Tax Amnesty program, Revenue Secretary Dan Hassell announced yesterday. “Individuals and businesses that failed to take advantage of the program will be assessed a 5 percent penalty on their unpaid amnesty eligible delinquencies, as the law requires,” Hassell said. “The department is taking the appropriate steps to ensure that delinquent taxpayers are aware of their outstanding liabilities and the additional penalties they now face.”

Act 84 of 2016 authorized the Tax Amnesty program to net an estimated $100 million for the 2016-17 fiscal year budget. The program exceeded that estimate by providing $130.4 million in net revenue to the Commonwealth of Pennsylvania. The program ran for 60 days, between April 21 and June 19, and allowed eligible individuals and businesses to pay past-due state taxes while having all the penalties and half of the interest waived. Act 84 required the Department of Revenue to notify all known delinquent taxpayers in writing of the existence of the Tax Amnesty program. As a result, the department mailed notification letters to approximately 800,000 known delinquent taxpayers. The statute also called on the department to publicize the program to maximize public awareness and participation.

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