If you or your business neglected your state tax obligations, now may be the time to make it right.
Connecticut this week announced its Fresh Start tax initiative, a voluntary compliance program for individuals and businesses that provides incentives to pay their outstanding, unreported taxes to the state.
In announcing the program, Governor Dannel Malloy and state Tax Commissioner Kevin Sullivan said they hope to generate up to $85 million in additional revenue.
"Not only will this program help individuals and businesses get back on track on their tax payments, but it will bring significant revenue back to our state without raising taxes," Malloy said.
People and businesses looking to participate must apply online to join the program.
The Department of Revenue Services could then waive penalties and reduce the 50% interest payments owed to the state.
Malloy said the program was not a tax amnesty—such as the state offered in 2013—as it does not include accounts receivable and there is an emphasis on future compliance.
The state will work with businesses and individuals to get them back to filing, reporting, and paying their tax obligations on a regular basis.
The Fresh Start program includes state income, business entity, sales and use, withholding, corporation business, and gift taxes.
It does not include federal, local property, and state payroll taxes or fees owed to the Secretary of the State.
Malloy said the sooner a taxpayer enters the program, the more they can potentially save on interest and, possibly, avoid an audit, which would disqualify them from participating in the program.
In general, to be eligible for the program, a taxpayer must have failed to file a return, or failed to report the full amount of tax on a previously filed return, for any tax return due on or before Dec. 31, 2016.