Tax amnesty has been used by federal and state taxing authorities to help taxpayers avoid criminal prosecution and reduce penalties by coming clean with a timely, accurate, and complete voluntary disclosure. These programs have historically been available for domestic or foreign income. 

That’s about to change for foreign filings as the Internal Revenue Service pulls the plug on Offshore Voluntary Compliance Program. The program sunsets on September 28, 2018, eliminating an avenue to redemption for delinquent taxpayers.

But state programs for coming clean with domestic income may still be available. While New Jersey is closing down its state-related offshore voluntary compliance initiative on Nov. 1, it is also opening up a domestic amnesty program. 

From Nov. 1, 2018 to January 15, 2019, eligible taxpayers will be able to take advantage of an amnesty program:

  • To file and pay their past due taxes with reduced interest and no penalties 
  • Eligible periods generally cover state tax liabilities for tax returns due on or after February 1, 2009 through September 1, 2017

Qualifying taxpayers that do not take advantage of this amnesty program may see an additional 5% non-abatable penalty imposed on “any eligible debts not resolved during the amnesty period.?

Taxpayers who participate in the New Jersey Offshore Voluntary Compliance Initiative are not eligible for the 2018 New Jersey Tax Amnesty program.

The Takeaway

Throughout the country, delinquent taxpayers may have opportunities to seek tax amnesty. The Council on State Taxation (COST)
maintains a listing of 2018 State Tax Amnesty Programs, which includes both open and upcoming amnesty programs. Programs in Alabama, Connecticut and Indiana are closing soon so take advantage while you can. Give us a call if you need some help.

Let’s talk tax

Judy Vorndran can be reached at or 720.227.0093. Follow Judy on LinkedIn.