THE TAX ATTIC with Jerry Coon

June 2, 2011 // 0 Comments

Tax Amnesty, new 1099-K Most of what we have been reading about the State of Michigan lately concerns Governor Snyder’s quest to get a budget passed as soon as possible. It looks like he will successful, too. We might not all like the final result, but at least a budget will be in place before October this year. Michigan has other programs currently going on, such as Tax Amnesty. Every few years Michigan gives individual taxpayers and business taxpayers the opportunity to catch up on any delinquent taxes they might owe without having to pay the penalties associated with the tax. This year’s version started on May 15 and lasts through June 30, 2011. Michigan hopes to collect an extra 60 million dollars or so this time around. Tax Amnesty applies to only 2009 and earlier returns such as Michigan Business Tax returns; Single Business Tax returns; Sales, Use, and Withholding Tax returns; and Income Tax returns. It does not apply to 2010 returns. Tax Amnesty applies only to the penalties associated with these returns. In order to qualify for amnesty, Michigan must receive full payment of all tax due and 100% of all interest due. They have designed a special amnesty form, Michigan Tax Amnesty Application Form 3855, that must accompany the check. The taxpayer will not be granted tax amnesty if a completed Form 3855 does not accompany the check. The package must be postmarked by the June 30 date. If the form is right, the tax paid is right, and the interest is right, all applicable penalties will then be forgiven. There is an online calculator for the interest due. I would recommend using that calculator. Evidently the law that created this year’s amnesty mandates that 100% of the interest must be paid. If the taxpayer is only $1 short on the interest, amnesty will not be granted and the penalties will not be forgiven. With that in mind, it might pay to add a few dollars of interest to the check just to be sure the interest is covered. Michigan has stated they will refund any overpayments. The online calculator can be accessed at www.MiTaxAmnesty.org or their telephone number is (855) 466-4829. Tax amnesty does not apply to city income tax […]