Posted by: Brett Neate, CPA

The Ohio Budget Bill signed by Governor Kasich on June 30^th includes a massive tax break for businesses delinquent in filing Use Tax returns.  Not only will interest and penalties be waived, but the tax itself will be abated for all pre-2009 periods!  The amnesty period runs from October 1, 2011 to May 1, 2013 and offers benefits to both registered and unregistered taxpayers. 

With the introduction of this amnesty program the previously discussed Use Tax Education Program and Voluntary Disclosure Agreement processes can be disregarded.

Below is a brief breakdown of the benefits this amnesty program will provide:

• Pre-2009 use tax will be abated for any consumer who utilizes the amnesty program and pays all use tax liabilities for post-2008 years.
• Interest and penalties will be waived for consumers who did not register for a use tax account prior to June 1, 2011.
• Interest and penalties can NOT be waived for consumers who were registered for a use tax account prior to June 1, 2011.
• Payment plans can be setup with the Tax Commissioner to pay the use tax liability over a period of up to seven years.
• A consumer may NOT participate in the amnesty program if a use tax assessment is issued prior to October 1, 2011.
• The Department of Taxation is not expected to accelerate assessments on current audits prior to October 1^st.  However, there is always a chance assessments may be issued before this date and make the taxpayer ineligible for the amnesty program.
• Even if a consumer does not participate in the amnesty program, use tax assessments for periods prior to January 1, 2008 may NOT be issued, even if the company is currently under audit.

Ohio General Tax Amnesty (for taxes other than use tax)

The budget bill also included a General Tax Amnesty program that will run from May 1, 2012 to June 15, 2012 for, essentially, all Ohio taxes other than use tax.

This bill was signed less than a week ago and not much guidance has been issued.  I will communicate additional details on the amnesty programs as they become available.