FRANKFORT – Kentucky is launching a tax amnesty program allowing people or businesses who owe back taxes to the state to pay with no fees or penalties. The threat of prosecution will be waived, and only half the interest owed will be due.
“This program will generate much-needed revenue for vital services in Kentucky at a time when dollars are hard to come by,” Finance and Administration Cabinet Secretary Lori H. Flanery said in a news release. “At the same time, we are making sure that delinquent taxpayers pay their fair share.”
The 61-day program kicks off Oct. 1. Delinquent taxpayers will soon receive mailed notifications stating the known amount of back taxes. They have until the end of November to apply for amnesty and pay their overdue taxes.
However, if taxpayers fail to take advantage of the amnesty program, penalties get more severe and the interest escalates. An additional 2 percent interest will be charged on unpaid amnesty-eligible taxes. Taxpayers taking advantage of amnesty must remain current over the next three years or face reinstated penalties, fees and interest.
The General Assembly authorized the amnesty program in the 2012 legislative session. Kentucky conducted a similar tax amnesty program in 2002. More than 23,000 taxpayers participated, netting more than $40 million in back taxes.
“We’re making it as easy as possible for people to determine if they owe back taxes and to create multiple ways to pay,” Tom Miller, Commissioner, Kentucky Department of Revenue, said in the news release. “They can mail in the payment or use a credit card. They can pay at any of our 10 offices around the state, or they can pay online using a website we have created just for Tax Amnesty.”
The website – amnesty.ky.gov - provides news and information about the program, online payment options and a way to search for all persons and businesses on the delinquent tax roll. Anyone with questions can also call the Tax Amnesty toll-free hotline at 855-KYTAXES (855-598-2937).
The amnesty program applies to taxes owed only to the Kentucky Department of Revenue for eligible tax periods ending after Dec. 1, 2001, and prior to Oct. 1, 2011. While most on the delinquent taxes roll reside in Kentucky, the list includes people in all 50 states plus several other countries.
“This is a great opportunity for delinquent taxpayers to reestablish themselves as compliant,” Mack Gillim, executive director, Office of Processing and Enforcement with the Kentucky Department of Revenue, said. “It’s not only a fresh start for them, but it also helps those who comply every day with all the tax laws by creating an equitable distribution of the tax burden. We’re all in this together.”
While the current database shows nearly 170,000 individuals and businesses qualifying for tax amnesty, others may also owe back taxes. The list of delinquent debtors includes those businesses and individuals who have a tax lien on file, but does not include those who may owe taxes and have not filed. The state is continuously gathering taxpayer information to discover non-filers and under-reporters.
To spread the word about tax amnesty, an advertising and public relations campaign will take place across the state. Gov. Beshear will hold a news conference in Frankfort revealing more details on the kickoff day, Oct. 1. Ads will appear in newspapers and magazines and on websites. TV and radio commercials will generate awareness and Department of Revenue officials will make presentations to numerous groups and public events.
“It’s safe to say that if you owe taxes, you will hear about the amnesty program,” Flanery said.