W. Va. Code R. § 110-10H-7

Current through Register Vol. XLI, No. 50, December 13, 2024

Section 110-10H-7 - Application for Amnesty; Requirements; Deficiency Assessment

7.1. Timely application required. -- The amnesty program applies to any taxpayer who, during the amnesty period, timely files the application for tax amnesty and voluntarily does all of the following which are applicable:

7.1.1. completes, signs and files amended tax returns to report transactions and other material matters not included on original returns and pays in full all additional taxes shown to be due on the amended return or returns and 50% of the interest imposed on the additional taxes;

7.1.2. completes, signs and files all delinquent tax returns and pays in full all taxes shown to be due on the return or returns and 50% of the interest imposed on the taxes;

7.1.3. completes, signs and files amended tax returns to correct all incorrect, deficient or incomplete original returns and pays in full all taxes shown to be due on the amended return or returns and 50% of the interest imposed on the tax or taxes;

7.1.4. pays in full all previously assessed tax liabilities and other taxes legally collectible under W. Va. Code ' 11-10-11 and 50% of the interest due thereon;

7.1.4.1. If a liability has been compromised under W. Va. Code 11-10-5q prior to the amnesty period, the taxpayer may qualify for waiver of penalties, additions to tax and 50% of the interest owed only if the compromise specifically states the portions of the total compromise amount that are attributable to penalties, additions and interest.

7.1.5. provides proof that the taxpayer has withdrawn with prejudice from any administrative or judicial proceeding, if required by subdivision 6.2.2; and

7.1.6. otherwise complies with the requirements of the amnesty program.

7.1.7. If a taxpayer has more than one West Virginia tax identification number for a single type of tax, the taxpayer shall file a separate return for each number for that type of tax.

Example. Taxpayer has a different identification number for each of three businesses it owns. Taxpayer wishes to participate in the amnesty program to pay sales tax liabilities due under all three of the numbers. Taxpayer must file three separate amnesty returns, one for each identification number.

7.1.8. A tax amnesty return is timely filed if postmarked by the United States Postal Service or received by the State Tax Department during the amnesty period. A return which is not sufficiently complete may not be considered to be timely filed. If a return does not contain sufficient information to identify the taxpayer, tax and tax period for which amnesty is being applied, it is insufficiently complete.

7.1.9. A taxpayer may not file a tax amnesty return by electronic or telephonic means.

7.2. Due date of tax for which amnesty granted. -- Except as provided in subsection 7.4 of this section, all tax liabilities for which tax amnesty is sought plus 50% of interest accrued to the date of payment shall be paid (i.e., received) no later than the close of business on November 30, 2004. Interest on the amount of tax due shall be calculated as prescribed in W. Va. Code ' 11-10 using the rate for the appropriate taxable year, and shall continue to accrue until the tax liability is paid.

7.2.1. Tax liabilities for which amnesty is sought that are not paid when due under this amnesty may result in amnesty not being granted.

7.2.2. Interest can be computed using the Interest and Additions to Tax Calculator located at www.state.wv.us/taxdiv. This calculator or a link to it will also be available at the Departments Amnesty website, www.wvtaxamnesty.gov.

7.3. Payments. -- Payments made by the taxpayer under this tax amnesty program shall be in United States currency or by certified check, cashier's check or post office money order, payable to the West Virginia State Tax Department.

7.3.1. The taxpayer may not make payments by credit card, debit card or electronic funds transfer.

7.3.2. Payments received under this amnesty program shall be applied first to the oldest tax period and then chronologically to the next most recent period until all the payments have been applied.

7.4. Installment payment agreements. -- The Tax Commissioner may, at his or her discretion and upon such terms and conditions as the Commissioner may prescribe, enter into an installment payment agreement with the taxpayer instead of the full immediate payment required by subsection 7.2 of this section if full immediate payment would create a severe financial hardship.

7.4.1. Each installment payment agreement shall provide for payment of the tax due and 50% of the statutory interest on the outstanding amount of tax due, computed to the date the installment payment agreement is executed by the taxpayer. The amount of tax and interest due from the taxpayer shall be stated in the installment payment agreement as the installment payment agreement amount.

7.4.2. Down payment. -- The installment payment agreement shall require payment of 25% of the installment payment agreement amount or $1,000, whichever amount is greater, at the time the installment payment agreement is submitted to the Tax Commissioner for acceptance and signature.

7.4.3. Interest. -- Interest on the installment payment agreement amount shall be calculated at the rates determined under W. Va. Code '' 11-10-17 and 17a, as applicable to the installment payment period, and shall accrue on the declining balance of the installment payment agreement amount from the date the installment payment agreement is signed by the taxpayer to the date the last installment payment is made.

7.4.3.1. Interest on installment payments is computed at the statutory interest rate, not 50% of that rate.

7.4.4. Lien securing payment. -- When payments are made under an installment payment agreement, the amount due shall be secured by recordation of a tax lien against the property of the taxpayer (and also by recordation of a tax lien against the property of any person guaranteeing payment of the installment payment agreement amount, should there be a guarantor) unless the Tax Commissioner determines that existing recorded tax liens are adequate to secure the payment. Liens required by this subdivision shall be recorded in each county of this State in which the taxpayer (and the guarantor, if any) owns an interest in property and shall be released by the Tax Commissioner upon full payment of the amount stated in the installment payment agreement plus applicable interest.

7.4.5. Failure to comply with installment payment agreement. -- Failure of the taxpayer to fully comply with the terms of the installment payment agreement shall render the grant of amnesty and the waiver of penalties, additions to tax and interest under this amnesty program null and void, unless the Tax Commissioner excuses the noncompliance due to reasonable cause. In the event of an unexcused noncompliance with the terms of the agreement, the taxpayer shall immediately pay the unpaid balance of the agreement amount plus the interest and all additions to tax and penalties waived under section six.

7.4.6. Late payment of installment payment. -- Notwithstanding the provisions of subdivision 7.4.5 of this subsection, payment of an installment payment after the date it is due under the installment payment agreement shall not void the agreement, provided the amount of the payment, plus a late payment fee of $10 or one half of one percent (.005) of the amount of the late installment payment, whichever is the greater amount, is paid within 20 days after the payment was due under the agreement.

7.4.7. Failure to timely pay current taxes. -- If a taxpayer with an installment payment agreement fails to timely file returns and remit current tax liabilities by their statutory due date or dates, the agreement shall be rendered null and void, unless the Tax Commissioner determines that the failure was due to reasonable cause. In the event an installment payment agreement becomes null and void, the taxpayer shall immediately pay the unpaid balance of the agreement plus interest and all additions to tax and penalties that were waived when the Tax Commissioner accepted the agreement.

7.5. Understatement of tax due. -- If, subsequent to termination of this tax amnesty program, the Tax Commissioner determines there was a defect in the amnesty application or in the materials submitted in support of the amnesty application and subsequently issues a deficiency assessment upon the application or a return or amended return filed pursuant to W. Va. Code ' 11-10H and this rule, the Tax Commissioner has the authority to collect the additional tax due, impose applicable penalties, additions to tax and interest and to pursue any criminal prosecution as may ordinarily be brought with respect to the defect as if no amnesty had been granted the taxpayer.

7.6. Mistake or misrepresentation of material fact. -- The Tax Commissioner may review all cases in which amnesty has been granted and may on the basis of a mistake or misrepresentation of a material fact, rescind the grant of amnesty, or in lieu thereof, may obtain appropriate review of the grant of amnesty or otherwise proceed under The West Virginia Tax Crimes and Penalties Act (W. Va. Code ' 11-9) or The West Virginia Tax Procedure and Administration Act (W. Va. Code '11-10), or both. The taxpayer may appeal the Tax Commissioner's order rescinding the grant of amnesty by filing a petition for appeal with the Office of Tax Appeals within 30 days after receipt of the Tax Commissioner's order, which shall be served by personal service or by certified mail.

7.7. False or fraudulent amnesty return. -- Any taxpayer who files an amnesty application, tax return or amended return that is false or fraudulent shall be subject to applicable civil penalties and be referred for criminal prosecution.

7.8. Attempt to evade or defeat tax. -- Any taxpayer who attempts in any manner to defeat or evade payment of tax or interest under this amnesty program shall be subject to applicable civil penalties and be referred for criminal prosecution.

W. Va. Code R. § 110-10H-7