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New program offers temporary amnesty for delinquent Missouri taxpayers; could bring in $75M

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JEFFERSON CITY, Missouri — Hundreds of thousands of delinquent Missouri taxpayers will get the chance to pay back taxes without penalties or interest as part of a temporary amnesty program that's expected to bring in about $75 million.

The program, which begins Tuesday and runs through Nov. 30, has the potential to be one of the most high-impact measures passed by lawmakers in the most recent session. Department of Revenue estimates show that about 350,000 taxpayers could be eligible for amnesty. Interest and fines on back taxes will be waived for those who participate, but they must pay taxes in full and on time for the next eight years. Otherwise, they'll be charged the interest and any other penalties previously forgiven.

Generally, the goal of tax amnesty is to bring in a quick surge of additional revenue. Missouri last offered a tax amnesty program in fiscal year 2003. Several other states — including Kansas, Indiana, Maryland and Oklahoma — instituted similar tax amnesty programs this year.

While businesses also can apply for tax amnesty, the program likely will entice more individuals who have fallen behind or failed to file in previous years, said Joe Marchbein, a member of the Missouri Society of Certified Public Accountants. Revenue Department numbers show about 290,000 individuals are eligible, agency spokeswoman Michelle Gleba said.

"It's really a clean bill of health," Marchbein said. His firm in the St. Louis suburb of Chesterfield firm is one of several he knows of that have fielded calls about the program.

Taxpayers with a payment agreement with the Revenue Department also can participate if they pay the remaining balance owed before the Nov. 30 deadline. Those with pending court challenges, criminal investigations or with delinquencies only of lien fees and returned check charges are not eligible.

The state estimated in June that it would spend roughly $400,000 in advertising the amnesty to drum up participants. Letters were sent last week to taxpayers identified as having not filed state tax returns in previous years.

Legislative researchers estimated the program could bring in more than $75 million, although the net benefit would be closer to $25 million assuming the state would have recovered the rest eventually.

Lawmakers have budgeted $40 million of the anticipated money to pay for an insurance provider rate increase and dental benefits for low-income adults on Medicaid. That decision that resulted from a compromise that was key to the legislation's passage, as some lawmakers had been opposed to giving breaks to taxpayers who have not paid taxes.

Any leftovers could be used as general revenue.


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