Rhode Island Voluntary Disclosure Agreement: What You Need to Know
If you are a business owner or individual located in Rhode Island, you may have heard of the state’s Voluntary Disclosure Agreement program. The program is designed to encourage taxpayers to come forward and report any unpaid taxes they may owe to the state. In this article, we will explore what the Rhode Island Voluntary Disclosure Agreement is, who can benefit from it, and how it can help you avoid penalties and interest on unpaid taxes.
What is the Rhode Island Voluntary Disclosure Agreement?
The Rhode Island Voluntary Disclosure Agreement (VDA) is a program offered by the Rhode Island Division of Taxation. It allows taxpayers who have unpaid taxes in Rhode Island to voluntarily come forward and report their tax liabilities to the state. In exchange, the state offers certain incentives to participants, including a waiver of penalties and reduced interest rates on any unpaid taxes.
Who can participate in the Rhode Island VDA program?
The Rhode Island VDA program is available to businesses and individuals who have unpaid taxes in Rhode Island. This includes taxpayers who have not filed tax returns, underreported their income, or failed to pay taxes owed to the state. Even if you have received a notice from the Rhode Island Division of Taxation regarding your unpaid taxes, you may still be eligible for the program.
Benefits of participating in the Rhode Island VDA program
One of the main benefits of participating in the Rhode Island VDA program is the waiver of penalties that would otherwise be assessed on the unpaid taxes. In addition, participants can take advantage of reduced interest rates on the unpaid taxes. This can result in significant savings for taxpayers who owe large sums of money to the state.
Another benefit of the program is that it allows taxpayers to come forward voluntarily, rather than waiting for the state to discover the unpaid taxes. This can help to avoid the embarrassment and potential legal consequences of having the state uncover the unpaid taxes on its own.
How to participate in the Rhode Island VDA program
To participate in the Rhode Island VDA program, taxpayers must complete an application and submit it to the Rhode Island Division of Taxation. The application includes information about the taxpayer’s business or individual circumstances, including the types of taxes owed, the time periods for which taxes are owed, and the amounts of unpaid taxes.
Upon receipt of the application, the Rhode Island Division of Taxation will review the information provided and determine whether the taxpayer is eligible for the program. If approved, the taxpayer will be required to pay the unpaid taxes, plus interest, under a payment plan approved by the state.
Conclusion
If you have unpaid taxes in Rhode Island, the Rhode Island Voluntary Disclosure Agreement program may be a good option for you. By voluntarily coming forward and reporting your tax liabilities, you can avoid penalties and enjoy reduced interest rates on any unpaid taxes. To learn more about the program and how to participate, contact the Rhode Island Division of Taxation or consult with a tax professional in your area.