Oklahoma Authorizes Tax Amnesty Program

On May 24, 2017, the Oklahoma Governor signed House Bill 2380, directing the Oklahoma Tax Commission (OTC) to establish a tax amnesty program termed the Voluntary Disclosure Initiative (VDI). The VDI, primed to begin on September 1, 2017 and end on November 30, 2017, provides waiver of penalty, interest and other collection fees due on eligible taxes for qualifying applicants. Taxes eligible for the VDI include income tax, sales and use tax, withholding tax, gasoline tax and mixed beverage tax.

To be eligible to participate in the VDI, taxpayers must:

• Not have outstanding tax liabilities other than those reported under the Voluntary Disclosure Initiative;
• Not have been contacted by the OTC, or third party acting on behalf of the OTC, with respect to the taxpayer’s potential or actual obligation to file a return or make a payment to the state;
• Not have collected taxes from others, such as sales and use or payroll taxes, and not reported the taxes; and
• Not have, within the preceding three years, entered into a voluntary disclosure agreement for the type of tax owed.

Under the VDI, the OTC must limit the period for which additional taxes may be assessed to three years for annually filed taxes, or 36 months for taxes that do not have an annual filing frequency.

Taxpayers that meet the eligibility requirements above, but have collected taxes from others (such as sales and use or payroll taxes) and not reported those taxes, may enter into a modified voluntary disclosure agreement with the OTC. This agreement provides complete waiver of penalty, while any interest waiver will be at the OTC’s discretion. In addition, the period for which taxes must be reported and remitted or assessed is extended beyond the three-year or 36-month period to include all periods in which tax has been collected but not remitted.   

For questions about these law changes or other state and local tax matters, please contact us. ­­­