Llc Taxes In Ohio | Make Payment To State Taxes | New Ohio State Tax
Ohio State Options or Resolutions for State Back Taxes
The State of Ohio possess a multi-face approach for managing unpaid income tax or Ohio State Back taxes. The department of taxation is liable for collecting and administrating the Ohio tax code. But the work of collections enforcements lies with the Attorney General. In addition, the office of Attorney General employs the private collection firm known as Special Counsel” who are responsible for performing their maximum collection activities. The Attorney general office offers private collection firms the complete power of the Attorney General while management of their collection matters.
The individual tax options for Ohio State
Taxpayers who owe income taxes to the state of Ohio, have with them three or four primary resolution options. These options helps taxpayers in reaching a good resolution for their delinquent tax liabilities. The options available are:
An Installment agreement is also called payment plan. It is a kind if agreement where the taxpayer makes an agreement with the State of Ohio for making monthly payment of taxes. The Taxpayer makes payment till the time they satisfy their due liabilities of taxes. You can get more information about it from the Ohio State Tax Payment plans website.
An offer in compromise is a program where the taxpayer might offer for settlement of due tax liabilities. In general, the taxpayers have to pay an amount that is less than the amount he owes. In the State of Ohio, the state might grant an offer in compromise for the economic hardship, which also includes innocent spouse relief ad Doubt as to liability. In some of the instances, the state might give approval of an OIC of a significant probability that the claim if in case collected, is subjected to refund under the Department of Taxation Statutes, rules or regulations.
A request for penalty abatement is a kind of written request for asking the state for waiving some or all of the assessed tax penalties. Same as the IRS, the state also gives permission to the taxpayers in some cases for decreasing the specific tax penalties.
As per the law of the State of Ohio, when there is joint assessment of the spouses for personal income tax and one of the spouse has been given relief from the joint assessment under IRC 6015, and there is resumption that the spouse can have the same relief for any kind of Ohio assessment of the similar liability. The spouse need to accomplish an Offer in Compromise application. In addition, they should include all kind of correspondence with the IRS in relation to the innocent spouse relief. Also this involves all kind of tax returns such as all attachments for the tax years in question.
The State of Ohio takes into consideration the innocent spouse relief for those who have not got same tax relief from the IRS. But the taxpayer should look for that relief by filling an Offer in Compromise application under Doubt as to the liability situations.
Available alternative options
Challenging the assessment: If in case the taxpayer has any proposed assessment for extra income tax owed because of an Ohio Department of Taxation audit, they keep the opportunity for appealing the proposed assessment. The Taxpayer can first appeal to the office of Department of Taxation. Thus, an informal hearing is done, through telephone with a tax attorney from the taxation Department.
If the taxpayer is not able to solve the tax problem with the Department of Taxation Appeals Office, the taxpayer can appeal to the Board of Tax Appeals. The Board of Tax Appeal is one of the administrative, Judicial Body that functions in a formal, courtroom kind manner. A taxpayer might represent themselves in front of the Board of Tax Appeals. But It is good for the taxpayer to hire a skilled attorney having experience in practicing in front of the Board of Tax Appeals.
The Office of Attorney General is responsible for representing the Department of Taxation for cases in front of the Board of Tax Appeals. The taxpayer gets the opportunity for settling down with the attorney general office attorney. But if in case the taxpayer is not able to solve the tax issues with the AG, the taxpayer will further go for hearing in front of the board. The Board then issues a ruling depending on the presented proofs. The Board applies the Ohio laws to the facts of the case. Luckily, the taxpayers can make appeal for the decision of Board of the Tax Appeals to the Ohio Appellate courts.
The Bankruptcy option is an expensive endeavor. Thus, this option is most likely only practical for the taxpayers having substantial personal liabilities other than their owing tax amount. In general, the tax amount might discharge the state taxes through the bankruptcy processes. Taxpayers must look for the recommendations of any experienced bankruptcy attorneys before going for this option.
The Tax Amnesty program in Ohio State
Starting from January 1, 2018 to February 15. 2018, the Department of Taxation had a Tax Amnesty program. The program was there for those individuals and businesses having unreported or underreported income. Because of this, if these taxpayers involved in the program, the Department of Taxation is responsible for waiving all kind of penalties and only assess half the interest, if in case, the taxpayer filed or corrected, all their returns and make payment of the whole tax due. At present, the state does not offers this program. But if in case, the state decides for reopening the program, required filters must take the benefit.
Appealing rights
As discussed, the State of Ohio, do not offers its taxpayers the right to appeal determination of the Attorney General or Department of Taxation that concerns the tax collection owed. But there are some practical tips that either the taxpayer or the any of their representative, must follow in an attempt for reaching any reasonable resolution.
Firstly, you should not get afraid for escalating combative problems to any manager present at the Attorney General’s office or the Department of Taxation. Most of the time, a fresh set of eyes and the authority and the experience of a supervisor can assist in resolving those issues.
Secondly, If you think that your manager for your case is not following the laws for The State of Ohio, or is causing discrimination against you, you can file of request for doing an investigation. You can do this through a writing with the Department of Taxation problem Resolution office. The problem resolution office acts as a liaison in between the Department of Taxation and the taxpayers when the normal lines of communications breaks down or when any problem stays after several attempts for solving it through required channels have failed.
The office of Attorney General will make release of the tax liens only after the due taxes, which includes only payment of penalties, collection fees or interest, has been made in full or is satisfied through an offer in compromise agreement. The office of Attorney General forwards to the taxpayer a certificate of release for the tax lien in question. The taxpayer should file this certificate of release with the court where the filing of the tax lien is done for releasing it officially. Taxpayers many a times overlook or have a misunderstanding of this.
The initial factor to take into prior to consideration of a possible resolution, is determination of the legal rights of the taxpayer under Ohio Law in relation to the statute of limitation rules for owed tax collection.
In the State of Ohio, the attorney General’s office might file a tax lien against the taxpayer in their residential country. In general, it is filed for any kind of taxes owed that has been certified to them by the taxation department. The attorney general office has seven years in their hand starting from the date of the real tax assessments to start the legal proceedings for collection of the taxes. This is not same as the IRS. These processes mainly involves the garnishments of the bank accounts, wage garnishments and some retirement garnishments or investment accounts.
It also involves foreclosures or conductance of examination of the debtors through the court. If the office of the attorney general fails to start the proceedings for collection of taxes within a period of seven years, they are time barred from being able to make use of the enforced methods of collection.
But this does not have any effect on the status of any kind of tax liens filings. As per the law of Ohio, the filings of the tax lien have different statute of limitations. This kind of limitations only needs the state for refiling the lien in every fifteen years. In addition, they can keep the tax lien in active mode for up to 40 years. Thus, even when the State might be time barred for carrying out the enforcement collection of due taxpayer, they can still keep the tax lien on the property of the taxpayer for a period of 40 years. Certainly, this gives rise to an unrequired position for several taxpayers. The taxpayer might still require for resolving the circumstances with the state rather than the fact that they are protected by the statute from foreclosures, enforced collection measures and garnishments.
Outcomes of unpaid Ohio taxes
If you do not file or make payment of Ohio state taxes, then the Department of Taxes can certify your due tax amount to the Secretary of State. At that point, the Secretary of State or the collection agency who has been assigned to your account can start many kinds of collection actions against you. Here what happens when you fail to file your taxes.
- Ohio Department of Taxation Contact Information
- For Individual Tax Matters: (800) 282-1780
- For Business Tax Matters: (888) 405-4039
- General Inquiries: (800) 282-1780
- Collections: 877-607-6400
- Visit the Ohio Department of Taxation Website: https://tax.ohio.gov/
Penalties and Interest
The state can assess a failure to file penalty of about 5% of the due tax or a minimum of $50. This penalty is applicable monthly for up to 10 months, which means it can reach up to half of your tax amount or $500 whichever is big. Ohio also charges interest on the unpaid taxes. The rate of interest for maximum state taxes is the federal prime rate from the month of July of the previous calendar year in addition to the three points.
The Secretary of State can issues a tax lien against you for the unpaid taxes. A tax lien is a legal claim for your assets. It exists as a public record and in case you sell your assets or apply for the loans, the buyer or the lender will know that a lien is in place. As discussed above, until the tax lien is filed prior to the statute of limitation expires on the tax debt, it lasts for 15 years. It can be renewed so that it lasts for 40 years.
Like for an example, think that you will sell a car for $20,000. You due amount on a car loan is $5,000 and you also have an Ohio tax lien for $10,000. The proceedings of the sale will satisfy the car loan and the tax lien and you will receive the remaining amount. In other ways think that you are trying to take out a home equity line of credit but the lender observes that you have a tax lien against you so they do not accept your application.
The state can also garnish your wages when you have unpaid tax amounts. If such things happens, the state sends your employer a notice about the due taxes. Then your employer will withhold some of your payment and send to the state for covering the tax bill. This can be highly embarrassing as well as stressful.
Based on the situation, the state might also seize the assets or take the funds from your bank account. In order to avoid the collection actions, you should also try to solve your state tax debt, as quickly as you can. It is always good to conduct the state and proactively make all arrangements than to wait for the state to take action against you.
Conclusion
To conclude, the taxpayers have several tools at their disposal while dealing with the tax liabilities with the State of Ohio. With this being said, the state of Ohio possess a government friendly statute of limitation for conducting enforced tax collection. In addition, the penalty, interest and also the collection fee system also results in reasonable taxes ballooning into some crippling liabilities. Thus, taxpayers must consult with skilled tax professional as quickly as their issues rises. A tax professional can assist in determining which action is best for your situation.