Participating in a Voluntary Disclosure Agreement (VDA) may be something you should consider if you have not registered to bring it together in a state where you should have it. But is a VDA for you? In talking to our clients, we know there are a lot of questions about VDAs. To answer some of the questions and help you decide if a VDA is right for you, keep reading to see four common misunderstandings about VDAs. I have a clue. It is essential to preserve the taxpayer`s anonymity until an agreement is reached. Therefore, the tax advisor should not at any time inform the tax officer of the taxpayer`s identity until an acceptable agreement has been fully negotiated and accepted by the taxpayer. Companies considering a voluntary disclosure program have options. You can complete and submit your own application or work with a professional who can help you navigate the process and prepare a VDA. Most applications are 2 to 3 pages long and require an explanation of the applicant`s type of activity, state activity and reasons for the application. Trial begins. The taxpayer (or his or her tax advisor) should first become familiar with voluntary advertising rules, administrative communications and state advice. The taxpayer or advisor should then contact the official who manages the program for each tax issue.
They are not included in a voluntary disclosure program without having to make an effort. However, the more external resources you rely on, the less you have to do yourself. Participation in a voluntary disclosure program does not exempt you from any previous tax obligations. However, it will likely reduce your overall tax debt. In general, the onus is on the taxpayer to submit the first proposed draft voluntary disclosure agreement, which the crown then reviews. The government may propose changes (some of which may be essential to the taxpayer`s financial situation). To avoid any surprises, taxpayers should not only develop agreements in principle, but also include as much detail as possible before submitting the first draft agreement to the state. By expanding their multi-state footprint, companies may have created physical exposure due to compounding and unfulfilled tax reporting obligations.
To support your compliance goals, we have a team dedicated to voluntary disclosure agreements. As part of this process, our voluntary advertising team for TAXE on Revenue provides the following benefits: The return period includes the full pre-reporting periods for which a taxpayer requesting voluntary customs clearance must generally file tax returns and pay the outstanding tax debt, plus interest in return for the state`s waiver of the tax debt. , for periods prior to the period of return and penalties. The period of return also includes the current incomplete tax return period, the return of which must be filed in a timely manner and paid at maturity. For more information on the lookback period, see « What is the lookback period and how is it determined? » Frequently asked questions. » The « lookback » periods for participating countries are available under the section « Return Periods for Countries Participating in the National Nexus Program » and « The Return Periods of the Use Tax for Taxpayers Only with Economic Nexus. » A Voluntary Disclosure Agreement (VDA) is a legal way to report taxpayers, taxes due for income, sales, real estate and other forms of tax. In return for voluntary tax return, states generally grant a waiver of the sentence and a limited return period (usually 3 to 4 years), which significantly reduces the tax owed in relation to an examination.