Revenue secretary thinks $200 million a realistic estimate
“Many times, people get behind and don’t know where to start. It is an opportunity to get caught up.” Tim BArFIELD, State Department of Revenue secretary
State Department of Revenue Secretary Tim Barfield said Monday he is confident the state’s new program to collect back taxes will generate the money necessary to balance state government’s budget.
“I feel good about the $200 million, but I don’t have $200 million in the bag today,” Barfield told reporters after acknowledging that some critics had questioned whether that amount was possible.
The Louisiana Legislature set a $200 million collection goal for this year’s $25.4 billion budget and appropriated that money to help pay for the state’s Medicaid program, the government-run insurance program for the poor that covers about one-fourth of the state’s population.
The money is being used as the state’s match to a much greater federal contribution. If the amnesty funds fail to materialize, state government will have to make deep cuts in Medicaid.
Barfield kicked off a statewide tour promoting a new Tax Amnesty program at the Press Club of Baton Rouge. Called “Fresh Start,” the program is set to run between Sept. 23 and Nov. 22. It offers delinquent taxpayers the chance to bring their accounts up to date by paying the overdue taxes and half the interest owed but the penalties would be waived.
The amnesty covers most state taxes, except for a few, such as, motor fuel and oilfield restoration.
Barfield is visiting Monroe and Bossier City on Tuesday; Alexandria, Lake Charles and Lafayette next week. New Orleans is not on the list for a visit, but Barfield said his aides are trying to organize a date. In addition, the campaign is running public service announcements on radio and television.
“Many times, people get behind and don’t know where to start,” Barfield said. “It is an opportunity to get caught up.”
Barfield said his department is poised to mail out 443,000 letters to wayward taxpayers, outlining how to take advantage of the program that will forgive penalties if back taxes and half interest are paid.
About $1.4 billion in back taxes come from delinquent tax billings, he said. About $1.1 billion from about 3,000 taxpayers are being disputed in audits and in litigation. The amnesty will be available to many of those taxpayers as well. Many of those whose cases have been transferred to private collection agencies, such as Performant, also will be able to take advantage of the amnesty program, he said,
The amnesty is not available to taxpayers involved in criminal investigations or litigation. But Barfield said taxpayers who have lost their driver’s, hunting and other licenses because of the delinquency would be able to recover those rights if they successfully complete the amnesty program.
It’s the sixth tax amnesty program offered in Louisiana since 1985.
The state collected about $483 million during the last amnesty in 2009, Barfield said. But most of that money came from taxpayers settling issues in audits or in lawsuits. Because the last amnesty was held in 2009, Barfield said he was unsure how much the state would be able to collect from that segment.
“This is relatively soon,” Barfield said. “The issues we have on the table today may not be as black and white.”
Under the law, a taxpayer accepting amnesty must adhere to the state’s interpretation of the conflict, Barfield said. If, from the taxpayer’s perspective, the state’s position is attractive, then the case will settle. If not, then it won’t, he said.
Taxpayers in the following categories are eligible to apply for amnesty:
- Taxpayers who failed to file a tax return or report.
- Taxpayers who failed to report all income or all tax, interest and penalties that were due.
- Taxpayers who claimed incorrect credits or deductions.
- Taxpayers who misrepresented or omitted any tax due.
- Certain taxpayers under audit or in administrative or judicial litigation.
ä ON THE INTERNET:
The website for “LA Tax Amnesty 2013: A Fresh Start” is www.ldrtaxamnesty.com.