Voluntary Disclosure Program
Post 2009 Tax Amnesty Program
Effective June 16, 2009
Important Note: The New Jersey Division of Taxation will honor the terms and conditions of the Voluntary Disclosure Agreements that were negotiated prior to May 4, 2009, as long as fully executed by June 15, 2009. Thereafter, the agreements will be considered null and void and subject to the new terms and conditions detailed in this revised notice..
New Jersey’s Voluntary Disclosure Program is a means for Taxpayers who realize that their activity creates nexus for New Jersey state tax purposes to come forward and file the appropriate tax return(s), registration materials, and pay outstanding tax obligations.
As of the conclusion of the 2009 Tax Amnesty Program on June 15, 2009, the terms and conditions of new Voluntary Disclosure Agreements (VDA) will be modified to be more stringent. The valuable opportunity and benefits provided by the 2009 Tax Amnesty program will not be improved upon by a VDA.
By coming forward prior to being contacted by the Division of Taxation, the Taxpayer will be permitted certain favorable terms and conditions offered under the Voluntary Disclosure Program that will still include anonymity pending an agreement. However, as a consequence of the 2009 Tax Amnesty program, the general look-back period will no longer be four (4) years (three prior years and the current year) but will be seven (7) years (6 prior years and the current year).
To be eligible for the Voluntary Disclosure Program there must have been no previous contact with the Taxpayer by the Division or any of its Agents; and the Taxpayer must be willing to pay ALL outstanding tax liabilities that are included in the Agreement and file the prior year returns within a reasonable period (within 60 days). No deferred payment plans will be permitted. Since each request is considered on a case-by-case basis, the Division may require additional information in order to evaluate the situation.
The Voluntary Disclosure Program is NOT available to resident taxpayers for Gross Income Tax purposes; taxpayers who are registered for the taxes they wish to come forward on; any Taxpayer currently under any criminal investigation; any Taxpayer who has received a nexus survey or has otherwise been previously contacted regarding their activities in New Jersey.
A Taxpayer who wishes to proceed with a VDA must submit a written proposal detailing all New Jersey business activity. This proposal should include the commencement date of the activity and the tax(es) to be filed. All taxes administered by the Division are eligible, but the most common include Corporation, Sales/Use, Litter, Personal Income and Withholding taxes.
All agreements entered into by the Division will be assigned an identifying number and are subject to review by Division management. Once this is accomplished and the terms are agreeable to the Taxpayer, the Division will sign copies of the agreement and return them for the Taxpayer’s signature. The Taxpayer is expected to remain compliant with all on-going tax obligations.
The executed agreement will clearly state which taxes are due and the effective date of the tax eligibility. It will indicate when the returns must be submitted (within 60 days). It will further state the requirement for completing the Tax Registration forms and Nexus Questionnaire.
In exchange, the Division agrees to waive the late filing penalties and criminal penalties relating to the tax returns and periods subject to the agreement. The unabateable penalty of 5% will be imposed for failure to take advantage of the Tax Amnesty Program ending on June 15, 2009. In addition, the 5% late payment penalty will be imposed in all instances. Statutory interest will be assessed and calculated at the prime rate plus three percent for the tax returns and periods included in the agreement.
As an alternative, the Division is willing to enter into negotiations leading to a Taxpayer specific closing agreement with a Taxpayer who is prepared to come forward with full disclosure of all pertinent information.
If you wish to proceed with the VDA process (or if you have any questions regarding the Program), please contact either:
Michael A. Gorczycki, Assistant Chief Office Audit Branch via mail at P.O. Box 269, Trenton, New Jersey 08695-0269, via phone at 609-943-5634, via fax at 609-633-2681, or via email for Corporation Business Tax, Sales and Use Tax and/or other business tax issues; or
The Individual Tax Audit Branch, P.O. Box 288, Trenton, New Jersey 08695-0288, 609-292-2163 for Gross Income Tax Individual and Withholding issues.
If you are doing business in multiple states, the Multistate Tax Commission (through its National Nexus Program) also has a Voluntary Disclosure Program. They can be reached at the National Nexus Program, Multistate Tax Commission, 444 North Capitol Street, NW Suite 425, Washington, DC 20001, 202-508-3800. Referrals from MTC will have to meet the new terms and conditions required by the Division as of June 16, 2009.
New Jersey’s Voluntary Disclosure Program is a means for Taxpayers who realize that their activity creates nexus for New Jersey state tax purposes to come forward and file the appropriate tax return(s), registration materials, and pay outstanding tax obligations.
As of the conclusion of the 2009 Tax Amnesty Program on June 15, 2009, the terms and conditions of new Voluntary Disclosure Agreements (VDA) will be modified to be more stringent. The valuable opportunity and benefits provided by the 2009 Tax Amnesty program will not be improved upon by a VDA.
By coming forward prior to being contacted by the Division of Taxation, the Taxpayer will be permitted certain favorable terms and conditions offered under the Voluntary Disclosure Program that will still include anonymity pending an agreement. However, as a consequence of the 2009 Tax Amnesty program, the general look-back period will no longer be four (4) years (three prior years and the current year) but will be seven (7) years (6 prior years and the current year).
To be eligible for the Voluntary Disclosure Program there must have been no previous contact with the Taxpayer by the Division or any of its Agents; and the Taxpayer must be willing to pay ALL outstanding tax liabilities that are included in the Agreement and file the prior year returns within a reasonable period (within 60 days). No deferred payment plans will be permitted. Since each request is considered on a case-by-case basis, the Division may require additional information in order to evaluate the situation.
The Voluntary Disclosure Program is NOT available to resident taxpayers for Gross Income Tax purposes; taxpayers who are registered for the taxes they wish to come forward on; any Taxpayer currently under any criminal investigation; any Taxpayer who has received a nexus survey or has otherwise been previously contacted regarding their activities in New Jersey.
A Taxpayer who wishes to proceed with a VDA must submit a written proposal detailing all New Jersey business activity. This proposal should include the commencement date of the activity and the tax(es) to be filed. All taxes administered by the Division are eligible, but the most common include Corporation, Sales/Use, Litter, Personal Income and Withholding taxes.
All agreements entered into by the Division will be assigned an identifying number and are subject to review by Division management. Once this is accomplished and the terms are agreeable to the Taxpayer, the Division will sign copies of the agreement and return them for the Taxpayer’s signature. The Taxpayer is expected to remain compliant with all on-going tax obligations.
The executed agreement will clearly state which taxes are due and the effective date of the tax eligibility. It will indicate when the returns must be submitted (within 60 days). It will further state the requirement for completing the Tax Registration forms and Nexus Questionnaire.
In exchange, the Division agrees to waive the late filing penalties and criminal penalties relating to the tax returns and periods subject to the agreement. The unabateable penalty of 5% will be imposed for failure to take advantage of the Tax Amnesty Program ending on June 15, 2009. In addition, the 5% late payment penalty will be imposed in all instances. Statutory interest will be assessed and calculated at the prime rate plus three percent for the tax returns and periods included in the agreement.
As an alternative, the Division is willing to enter into negotiations leading to a Taxpayer specific closing agreement with a Taxpayer who is prepared to come forward with full disclosure of all pertinent information.
If you wish to proceed with the VDA process (or if you have any questions regarding the Program), please contact either:
Michael A. Gorczycki, Assistant Chief Office Audit Branch via mail at P.O. Box 269, Trenton, New Jersey 08695-0269, via phone at 609-943-5634, via fax at 609-633-2681, or via email for Corporation Business Tax, Sales and Use Tax and/or other business tax issues; or
The Individual Tax Audit Branch, P.O. Box 288, Trenton, New Jersey 08695-0288, 609-292-2163 for Gross Income Tax Individual and Withholding issues.
If you are doing business in multiple states, the Multistate Tax Commission (through its National Nexus Program) also has a Voluntary Disclosure Program. They can be reached at the National Nexus Program, Multistate Tax Commission, 444 North Capitol Street, NW Suite 425, Washington, DC 20001, 202-508-3800. Referrals from MTC will have to meet the new terms and conditions required by the Division as of June 16, 2009.
Treasury: