New Tax Amnesty Opportunity for Indiana Business Taxpayers

New Tax Amnesty Opportunity for Indiana Business Taxpayers

On May 7, 2015, Indiana Governor Mike Pence signed into law P.L. 213, which establishes a tax amnesty program that might give business taxpayers with concerns about Indiana tax reporting a great opportunity to settle any outstanding or potentially outstanding tax liabilities with the Indiana Department of Revenue (Department). This is Indiana’s first tax amnesty program in nearly 10 years. The 2005 tax amnesty program collected over $205 million from business taxpayers. The new program is expected to collect between $109 million and $159 million for the state.

Taxes covered by the program are any taxes administered by the Department — the “listed taxes” — including, among others, the Indiana adjusted gross income tax, sales and use taxes, and financial institutions tax. While program details are yet to be worked out by the Department, the new law establishes certain program limitations which include, among others, the following:

  • A requirement that the Department establish an eight-week program that must conclude before January 1, 2017.
  • The program only applies to liabilities for tax periods ending before January 1, 2013.
  • Taxpayers are not eligible to participate if they participated in the 2005 amnesty program.
  • The Department will waive penalties and interest for accepted participants.
  • A failure to pay all listed taxes due for a tax period invalidates any amnesty granted for that tax period.

Based on the success of the prior program, this new program could be very beneficial for a large number of business taxpayers with outstanding or potentially outstanding Indiana tax liabilities.

This post was prepared by Francina A. Dlouhy, J. Daniel Ogren, and Matthew C. Piatt

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