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October 8, 2003

Taxpayers Should Act Soon to Benefit from Amnesty

TALLAHASSEE - Time is running out for Florida taxpayers to save money on taxes through the state's 2003 tax amnesty, the Florida Department of Revenue (DOR) said Wednesday.

"Florida's tax amnesty is a rare opportunity to save money if you owe tax, but you must act soon," said Jim Zingale, executive director of the Florida Department of Revenue. "Amnesty ends at midnight October 31. Taxpayers who owe unpaid taxes could lose out if they wait too long."

Amnesty participants pay no penalty and reduced interest on tax owed. In addition, DOR will not refer amnesty participants for criminal prosecution for tax violations if they fully and accurately disclose liability. Taxpayers currently under criminal investigation, or who have been convicted of tax-law violations, are not eligible for amnesty. Taxpayers can use amnesty to save not only on undisclosed tax liabilities, but also on routine bills, delinquencies, and tax warrants. Taxpayers can even resolve an audit currently under way by paying what they owe. This is Florida's first amnesty in 11 years.

Meanwhile, DOR is gearing up its advanced new SUNTAX computer system to enhance compliance with tax law. The system allows DOR to bring together information about all of a taxpayer's obligations in a single data system using a single taxpayer identifier, a simple point-and-click interface to assemble information, and expanded data-warehousing and customer-relationship management capabilities. By taking advantage of the data-warehousing capabilities of SUNTAX and related technologies, the Department is better able to compare tax information from several data sources to identify patterns of compliance across industries and regions.

Several compliance initiatives already are under way. Since June, the Department has mailed more than 43,000 letters to Florida businesses statewide that may owe sales tax on commercial rentals. DOR identified these businesses by comparing sales-tax registration information with property-tax records to identify occasions when a business was occupying commercial space that was owned by an entity other than the business at that location.

DOR also has sent letters of inquiry to more than 50,000 other Florida businesses, asking for more information about their tax affairs.

DOR contacted these businesses after comparing databases of businesses remitting corporate income tax with records of businesses required to pay insurance premium tax, corporate intangible personal property tax, unemployment tax, and sales tax.

DOR also compared records of businesses remitting gross receipts tax to records involving documentary tax and corporate-income tax databases. These contacts don't necessarily mean that the business has failed to comply with tax law, but they do mean that the business should review its compliance efforts carefully.

In the near future, the Department will compare property-tax and sales-tax records with databases maintained by other government organizations, such as the Department of Business and Professional Regulation, to identify patterns of tax compliance.

If taxpayers and accounting professionals discover overlooked tax obligations, tax amnesty offers a way to save while resolving tax worries, Zingale said. "We don't want anyone to have to pay one dime more than the law requires," he said. "However, not much time remains for taxpayers to save by taking advantage of tax amnesty."

If taxpayers take part in the amnesty program, DOR will:

  • Significantly reduce interest due. Amnesty participants who come forward to disclose a tax liability unknown to DOR will receive a reduction of one-half of the interest that would be due if DOR found the unpaid tax later. If DOR already has identified the tax liability in a bill, jeopardy assessment, or other assessment, or has already scheduled an audit, the taxpayer is eligible for a one-fourth cut in interest charges.
  • Completely waive penalty, which could equal up to 50 percent of the tax due.
  • Reduce the chances that they will be the focus of the Department's attention after the amnesty period, when DOR's new SUNTAX integrated tax administration system helps DOR assure uniform compliance with tax law.

In addition, taxpayers who owe tax face an increase in costs after Oct. 31, 2003. Interest on tax owed after that date will double, from 4 percent to 8 percent.

As of early October, DOR had collected more than $35 million through the amnesty program. Millions of dollars in additional amnesty payments are being processed, and taxpayers interested in amnesty are contacting DOR in rising numbers.

The Department has posted comprehensive information about amnesty on its Internet site at Taxpayers may go online to file and pay under amnesty, using a secure, encrypted Internet application. The application is fast, simple, and automatically calculates interest owed on tax due. Taxpayers also may call 1-800-352-3671 toll-free from inside Florida.

Taxpayers also may wish to explore the Certified Audit Program operated by the Florida Institute of CPAs and the Department. This program offers penalty and interest reductions for participating taxpayers. Taxpayers may choose whether they wish to report tax liabilities under the tax amnesty or the certified audit program, but they cannot receive tax benefits under both programs for the same liability.