Tennessee Department of Revenue Updates General Voluntary Disclosure Agreement Guidance
The Tennessee Department of Revenue has recently updated its general Voluntary Disclosure Agreement guidance.
According to the guidance, a Voluntary Disclosure Agreement:
- allows the taxpayer to resolve any prior tax liability and register to pay tax for future periods.
- offers a limited lookback period, the number of years the Department will go back when assessing the tax liability.
- abates or reduces the penalty applied.
Agreements are offered for any tax the Department administers on a case-by-case basis. The guidance states that in most instances, the Department will agree to abate the penalty associated with the non-filing. However, if sales tax was collected, a penalty may apply.
Regarding the lookback period, the guidance says that for most filers, the lookback period is based on when the return was due. Any return due from three years of Jan. 1 of the current year will be required to be filed. If sales tax was collected and not remitted, the lookback period would begin with the date that tax was first collected.
In addition, the guidance notes that Tennessee is a member of the Multistate Tax Commission’s National Nexus Program for those wishing to enter into agreements with more than one state.