Alabama Tax Delinquency Amnesty Program FAQ

Most taxes administered by the Alabama Department of Revenue, with the exception of motor fuel, motor vehicle, and property taxes, are eligible for the 2018 Amnesty Program. This includes but is not limited to corporate and individual income, business privilege, financial institution excise, consumers use, sellers use, withholding, and sales. For a list of eligible and ineligible taxes click here.

Eligible taxpayers include those who:

  • Are not a party to a criminal investigation or litigation in any court of the United States or Alabama pending as of March 6, 2018, for nonpayment, delinquency, or fraud in relation to any Alabama state taxes administered by the Department; and
  • Have not been contacted by the Department within the last 2 years.

  • Taxpayers who have been contacted by the Department within the last 2 years.
  • Taxpayers with an outstanding debt shown on the Department’s records in the form of a bill, assessment, or civil collection action (for example, garnishment).
  • Any taxpayer who has been scheduled for audit or is currently under investigation in relation to any Alabama state taxes administered by the Department.
  • Taxpayers who have been issued a final assessment in which the appeal period has expired pursuant to §40-2A-7.
  • Any taxpayer who has delivered or disclosed a false or fraudulent application, document, return, or other statement to the Department in connection with an amnesty application.
  • Taxpayers who have entered into a Voluntary Disclosure agreement with the Department before December 31, 2017.
  • Taxpayers who have been granted amnesty for the tax type as part of the Alabama Tax Delinquency Amnesty Act of 2016.
  • Waiver of 100% of interest and penalties.
  • The Department will not seek criminal prosecution so long as there are no false representations made.
  • Generally, a limited look-back period of 3 years for eligible taxes.
  • The Department will not seek to collect tax, penalties, or interest for tax periods prior to the look-back period.
  • For previously collected taxes held in trust (ex. sales tax...) Please see following link.
  • For taxes filed annually: The last 3 years of returns which are past due prior to January 1, 2017. Example: If you are a calendar-year taxpayer and you are delinquent filing your individual tax returns, you will be required to file tax year 2014, 2015, and 2016 returns. Penalties and interest on these returns will be waived. The Revenue Department will not seek to collect tax, penalties, or interest for tax periods prior to 2014.
  • For taxes filed monthly or quarterly: The last 36 months of delinquent returns for taxable periods that began before January 1, 2017.
  • For previously collected taxes held in trust (ex. sales tax...) Please see following link.

You are not eligible for the 3-year limited look-back period to the extent you collected taxes from a customer or employee. However, you are eligible for a penalty waiver when you remit these taxes during this program provided that you do not already have an account set up to remit these taxes. Example: If you collected sales tax on sales starting in May 2008, you must remit the sales tax you collected for tax periods beginning in May 2008.

An overpayment that arises after the filing of the amnesty application may make participants eligible for a refund or credit. No interest shall be paid on refunds for a tax period for which amnesty is granted.

By November 15, 2018, all applicable returns, supporting documentation, and the full payment of the tax must be submitted to the Department for all approved amnesty returns. The current year return (example: 2017 income tax return) must be submitted with the amnesty returns for eligible tax types. A waiver of penalties for failure to timely file a return and failure to timely pay in accordance with §40-2A-11 will be granted to current year returns filed with the amnesty returns for the eligible tax types. Waiver of interest does not apply to the current year returns.

For a comparison of the provisions in the 2018 Amnesty Program and the Voluntary Disclosure Program, please click here.