New Jersey Offers Tax Amnesty

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New Jersey has enacted a short tax amnesty period that will start later in 2018. It is the fifth "once in a lifetime" amnesty offered by the state - the last was in 2014. Eligible resident or nonresident taxpayers who have outstanding tax assessments with New Jersey's Division of Taxation ("the Division"), or who have not filed all required New Jersey tax returns and wish to submit them, will receive these benefits by applying under the amnesty:

 

  • Interest due on the late balance will be cut in half.
  • Most penalties will be abated, including late payment, late filing, and delinquency penalties.
  • The 10.7% recovery fee levied by New Jersey's collection contractor, Pioneer Credit Recovery, as well as any cost of collection fees charged by the Division, will be removed.

 

Any tax debt that is eligible for the amnesty but not resolved during the amnesty period will be assessed an additional 5% penalty.

 

The law requires that the amnesty may not start before November 1 and must end by January 15, 2019. The Division has yet to announce actual dates, detailed eligibility rules, or how to participate. It will post the details on its website when it becomes available, and we will update you in a Tax Alert.

 

Amnesty will apply to New Jersey state liabilities for tax returns originally due from February 1, 2009 to September 1, 2017. Participating taxpayers must remit the full tax and half the interest with their amnesty application. To receive amnesty for a tax return that was never filed, the required filings must be submitted and paid by the last day of the amnesty period. We can help you prepare returns and determine the proper tax and interest amounts to remit.

 

Even taxpayers who have received notices from the Division or are currently in collection may participate, but anyone under criminal investigation or charge for a state tax matter is ineligible. Any civil fraud or criminal penalties arising out of state law obligations will not be removed under the amnesty.

 

New Jersey's tax amnesty program provides a terrific opportunity for taxpayers with outstanding tax balances in the Garden State to wipe the slate clean. If you owe New Jersey tax or have not filed all your required returns there, your LMC professional can help determine if amnesty is right for you and guide you through the process.

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