Beginning in April of 2017, Pennsylvania will begin offering a Tax Amnesty Program to eligible taxpayers. The program is geared toward taxpayers, both individuals and businesses, who owe outstanding taxes. This program will allow eligible taxpayers to ultimately pay less than the total owed to the Pennsylvania Department of Revenue if the taxpayer is able to pay the entire amount of the principal tax due.
If the delinquent taxpayer can satisfy the principal tax amount in its entirety, the Pennsylvania Department of Revenue will waive all penalties associated with the outstanding balance and also waive one-half of the interest associated with the underlying tax. To participate, taxpayers must file an online amnesty return, file all delinquent tax returns and make the required payment within the 60 day amnesty period.
Timing is critical and inflexible. This amnesty program will only be in effect from April 21 through June 19, 2017. The Department of Revenue will not accept requests for extensions of time to file an amnesty application, so June 19, 2017, is the absolute cut-off date established by the program as currently written.
The amnesty program is applicable to almost all state taxes. However, failure to take advantage of this program if you are eligible carries significant consequences. After June 19, 2017, when the amnesty window closes, an additional 5 percent penalty will be added to eligible taxpayers who did not participate, and the interest which would otherwise have been cut in half will continue to accumulate. This essentially means eligible taxpayers can either pay less now or owe more down the line.
Pennsylvania had a similar program in 2010. Those taxpayers who participated in the 2010 tax amnesty program are presumed ineligible.
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