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Kansas offers tax amnesty to raise cash

  • Eagle Topeka bureau
  • Published Friday, August 13, 2010, at 12:05 a.m.
  • Updated Friday, August 13, 2010, at 6:09 a.m.

TOPEKA — Tax scofflaws, or those who have fallen behind on what they owe the state, will get a reprieve starting next month through a tax amnesty program.

Under the program, which runs Sept. 1 through Oct. 15, taxpayers who pay off their debt in full will have the penalties and interest waived. The option is available for tax debts accrued before Dec. 31, 2008.

"We're trying to make this as easy as we can for folks so hopefully they will take a look at it and see if it will help them out," said Steve Stotts, taxation director for the Kansas Revenue Department.

The Legislature approved the amnesty program earlier this year as a way to raise money. The department is estimating it will collect about $8 million from the amnesty — out of about $127 million that was owed the state as of Aug. 1.

This will be the third tax amnesty Kansas has sponsored. The first was in 1984 and the second was in 2003, when the state collected $53.7 million.

State officials expect to collect less this time around in part because the last amnesty was less than 10 years ago.

"We just don't think there is that much out there to get this time compared with last time," Stotts said.

Jerry Capps, vice president of the Wichita accounting firm Allen, Gibbs, Houlik, said those who owe the state money should take a look at the amnesty program.

It is the right thing to do, he said. But additionally, "Kansas has become more active in its auditing."

"It's a good opportunity if you think you have made some mistakes," he said. "This is the perfect opportunity to do it."

During the 2003 amnesty, Capps said he had clients who had previously made mistakes reporting various taxes and used the program as a way to pay the state the money they owed with no penalties.

"You are better off taking advantage of a program where you have no interest and no penalties," he said.

On a five-year-old debt, the penalties and interest can double the amount that is owed.

The amnesty program is for businesses and individuals and covers just about any type of tax the state collects — income, sales, estate, privilege, withholding, estimated, cigarette and tobacco, retailer's sales, compensating use, local sales and use tax, liquor enforcement, liquor drink, and mineral severance.

Forms for the amnesty program will be available on the Department of Revenue's website, www.ksrevenue.org, at the end of August.

Payments have to be made to the state in full and the check must be postmarked no later than Oct. 15. While participants must pay back taxes for a particular year in full, they don't necessarily have to clear their entire debt with the state to participate, said Dedra Platt, Civil Tax Enforcement manager with the revenue department.

For example, if someone owes the state money from 2004, 2005 and 2006 but only has money to pay the 2004 debt in full, they can pay the 2004 bill without penalties or interest.

"Once we have received the tax payment they will be notified if they are approved or denied," she said. "The only reason they (qualified participants) would be denied is if the tax hadn't been paid in full."

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