Significant state practices and amnesty programs.

• Author: Manos-McHenry, Deborah L.
• Position: Tax amnesty

Editor's note: Ms. Manos-McHenry chairs the AICPA Tax Division's State and Local Taxation Committee. Ms. Boucher is a member of the committee.

If you would like more information about this article, contact Ms. Manos-McHenry at (216) 689-9278 or Ms. Boucher at (414) 283-3621.

This column addresses a number of significant state practices and issues, including upcoming amnesty programs, that have occurred over the past 15 months. (A two-part article focusing on state corporate income tax developments, including significant nexus, tax base and apportionment activities affecting the majority of multistate taxpayers, will appear in future issues of The Tax Adviser.)

Connecticut's New Voluntary Disclosure and Nexus Program

The Department of Revenue Services (DRS) established a formal program that allows taxpayers to meet their state tax obligations. The Connecticut Voluntary Disclosure Program enables taxpayers that have failed to pay Connecticut taxes owed, or with underreported income from transactions on which taxes should be paid, to work with DRS to make satisfactory payment arrangements.

A taxpayer coming forward voluntarily may be granted certain benefits, such as a waiver of penalties on taxes owed and a limited "look-back" period (i.e., the number of tax periods for which the taxpayer may not have been in compliance). The underlying tax liability and related interest, however, must still be fully paid, and no guarantees are offered until the taxpayer presents DIALS with the appropriate information.

The DIALS also unveiled the details of a new DRS Nexus Program, which is a compliance program that seeks out those not paying Connecticut taxes. This program focuses on taxpayers and industries with high noncompliance incidences (such as unregistered out-of-state businesses that have nexus) and nonresidents with taxable Connecticut-sourced income (such as consultants and partners in limited liability partnerships).

Idaho Proposes Negligence Penalty If State Apportionment Detail Not Provided

Idaho imposes a 5% negligence penalty if a deficiency results from either negligence by the taxpayer or disregard by the taxpayer (or his agent) of state or Federal tax laws, Idaho Tax Commission rules or Treasury Regulations. Rule 410 provides examples of situations justifying the penalty, including a taxpayer's failure to provide the Commission with a copy of a final Federal determination within 60 days of the determination date, failure to file an Idaho amended return within 60 days after filing a Federal amended...