In April of this year, State Assembly Speaker Craig Coughlin proposed a tax amnesty program allowing New Jersey taxpayers to settle any back taxes owed with reduced penalties and fees.
Tax Amnesty programs have done very well for the state in the past. In 2014, an amnesty program brought in $75 million; and in 2009, an amnesty program brought in a whopping $725 million.
President of the State Senate, Stephen Sweeney, vocalized his support for the program and is going to push for legislative support as well.
What does this mean for you?
Well that depends on whether you owe back taxes or not. The program (if it becomes finalized) will allow any taxpayer, who owes taxes on returns filed between February 2, 2009 and January 1, 2018, to pay all of their debt; and the late fees and penalties will be at a reduced rate from the New Jersey Department of Treasury’s standard charge.
The NJ Department of the Treasury’s standard fees and penalties for late payment are 3% above the prime rate for every month or portion of a month the tax is unpaid, compounded annually.
Note: If you owe back taxes from taxes filed between February 2, 2009 and January 1, 2018, and fail to take advantage of the amnesty program, you will be subject to an additional penalty of 5%.
In addition to being able to pay off your taxes at a reduced fee and penalty rate, if you choose to participate, you will not be subject to any additional civil or criminal penalties related to your NJ taxes.
Again all of this is merely a possibility as of right now, and the amnesty program has not as of yet been approved. However, it has worked for the state of New Jersey in the past and it is very possible they will approve the program again.