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Rhode Island Tax Amnesty Soon Available

Rhode Island’s tax amnesty program will open on December 1, 2017, affording taxpayers a rare and limited-time chance to start anew by paying their tax liabilities without penalties and with a 25% reduction in the otherwise-applicable interest. The program also prevents the Rhode Island Division of Taxation from seeking civil or criminal prosecution of qualified taxpayers. The 75-day amnesty period will end on February 15, 2018.

Amnesty is available to individual taxpayers as well as to corporations, partnerships, LLCs, or any other entity subject to any Rhode Island tax that is collected by the Division, such as income, employment, excise, and sales and use tax. Local taxes, such as the tax on real property, are not eligible for the amnesty program. Amnesty is available for any taxable periods which ended on or before December 31, 2016.

The Division, in an advisory issued September 27, 2017, states that the Division will not block a qualified amnesty participant’s renewal of a Rhode Island professional license, driver’s license, or motor vehicle registration. The advisory also makes amnesty applicable to fees collected by the Division.

Not only are taxpayers with current tax debts eligible for amnesty, taxpayers who have failed to file required tax returns and pay the tax required to have been shown on such returns may be eligible for amnesty. In its September 27th advisory, the Division recommends that such persons contact the Division either shortly before amnesty begins or during the amnesty period. Additionally, taxpayers who have entered into an installment payment agreement for reasons of financial hardship are also eligible. However, amnesty will not be granted to taxpayers who are currently under any state or federal criminal investigation or are a party to any civil or criminal proceeding for fraud in relation to any state tax collected by the Division.

Beginning in early November, the Division plans to mail account statements to approximately 90,000 taxpayers. The account statements will let taxpayers know the cost to pay off their tax debts. The mailing also will include the official amnesty application form and a payment voucher.

When completed, the amnesty application form will be available on the official amnesty website, http://www.taxamnesty.ri.gov/, a central repository for official amnesty-related information. The Division also plans to provide telephone support for the amnesty program.

Nearly identical Rhode Island tax amnesty programs have been established by the state legislature in 1986, 1996, 2006, 2012, and now in 2017.

About The Authors

Marc A. Lewin

Marc practices tax and general business law. Marc’s legal work is characterized by strategic thinking, practical approaches, and careful drafting. Tax… Read More

E. Hans Lundsten

A former attorney advisor with the U.S. Tax Court as well as frequent lecturer and author on tax issues, noted tax… Read More

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