The Multistate Tax Commission opened a sales/use tax and income/franchise tax amnesty program for online marketplace sellers during the fall of 2017. Online marketplace sellers responded and a total of 852 of them applied to participate, overwhelming the MTC office that only deals with about 100 taxpayers per year.
Originally, the MTC received all the taxpayer’s necessary documentation before forwarding it to the state. Given the volume of applicants, the committee agreed to expedite the process by allowing taxpayers to send final voluntary disclosure agreements, tax registration forms, and other documents directly to the states. This procedural change only applies to sellers who are still waiting to receive state-signed voluntary disclosure agreements. The MTC will inform sellers if they have the option to send documents directly to the states.
For the previous four-year period, thirty applicants reported more than $1 million in back tax liability. Around a quarter of all applicants reported at least $100,000 in back tax liability.
Although the MTC program is closed, taxpayers who believe they have a liability should consider state offered amnesty programs or a voluntary disclosure. Some states may be willing to negotiate with online sellers. We are working with some states to negotiate more favorable terms. If you are interested, contact us.