News & Publications

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Garvey Schubert Barer Legal Update, January 2011.

Overview of Amnesty Program

The State of Washington recently announced its very first tax amnesty program, which will provide certain delinquent or unregistered taxpayers the opportunity to pay back taxes without penalties or interest. The program is set to begin on February 1, 2011 and will end on April 30, 2011. To participate, taxpayers must file an application with the Washington Department of Revenue (the "Department"), file all required returns and/or amended returns and pay in full all taxes due by April 30, 2011.

Eligibility

The amnesty program is open to both registered and unregistered taxpayers owing the following taxes for any open tax years:

• State (but not Local) Business and Occupation (B&O) Taxes;
• State and Local Sales and Use Taxes; and
• State Public Utility Taxes.

Taxpayers are not eligible if they:

• Have ever been assessed a penalty by the Department for evasion or misuse of a reseller permit or resale certificate; or
• Have ever been a defendant in a criminal prosecution related to failure to collect or pay the proper amount of any tax administered by the Department.

How to Participate

To participate in the amnesty program, taxpayers must:

• By April 18, 2011, (i) file an application with the Department; and (ii) file all outstanding tax returns and any amended returns for which they are requesting waiver of penalties and interest under the program.
  • Unregistered taxpayers must first register with the Department by filing a Master Business Application with the Department of Licensing, available at: http://www.dol.wa.gov/. After registering, they must then submit the application and file any outstanding returns.
  • Registered taxpayers simply need to submit the application and file any outstanding returns.

NOTE: Application forms are not currently available; however, the Department intends to have them available by mid-January 2011.

• By April 30, 2011, pay all taxes due for which a waiver of penalties and interest is requested under the program.
  • If a waiver request is associated with a tax invoice that has been billed to a taxpayer, the taxpayer must pay the full balance of taxes due on that invoice, even if the invoice includes taxes not covered under the amnesty program.
  • If the invoice is a tax warrant, the taxpayer must also pay all fees and surcharges due with respect to the tax warrant.
• Timely file all tax returns that become due during the amnesty program, and timely pay in full all taxes shown due on the returns.

Other Rules

• Taxpayers participating in the program waive their right to seek a refund or challenge the amount of taxes paid under the program.
• The Department may verify (i.e., audit) taxpayer returns for tax periods for which amnesty is granted. If the Department determines a deficiency exists with respect to tax liability reported and paid for those tax periods, taxpayers will be liable for taxes, penalties and interest with respect to the deficiency.
• Taxpayers in bankruptcy are ineligible for relief to the extent the payment of any tax debt to the Department would violate bankruptcy laws.
• Taxpayers are not required to prepay the penalties and interest for which they are requesting a waiver under the program.
• If taxpayers are current with respect to tax returns due as of November 25, 2010, any tax liability that accrues after that date does not qualify for the program.

Questions and Information

Interested taxpayers should check the DOR amnesty website at http://dor.wa.gov/amnesty/ for applications and information updates. Taxpayers with specific questions may also call the Department at 1-800-647-7706.

If you have questions about the amnesty program, or need assistance in applying, please contact Garvey Schubert Barer Tax Attorneys Larry Brant, Steve Nofziger, or Jason Faas at (503) 228-3939.