The Georgia Department of Revenue’s Voluntary Disclosure Agreement (VDA) program was created with the intention of bringing forth otherwise hidden tax dollars that would be sought out in an audit or criminal investigation with exponentially large penalties and interest. The program encourages taxpayers who have unfiled or underreported tax liabilities and have not yet been contacted by the Department to voluntarily come forward. Qualified participants will usually receive a waiver of all penalties and a limit of the length of time the taxpayer must disclose and pay previous liabilities. This length of time, called the “look-back” period, is generally three years but can be shorter or longer, depending upon a taxpayer’s particular circumstances.
Eligibility
To qualify for the VDA program, the taxpayer (individual or business) must submit an application form and:
Have not been contacted by the Department for enforcement purposes about that tax obligation (e.g., audit or compliance contact regarding registration or reporting requirements)
Are compliant with all other Georgia Department of Revenue tax obligations.
Penalty Waiver
Penalties will generally be waived for all periods included in the VDA agreement. However, interest will still be imposed on all amounts due.
Look-back Period
The Department will normally require a look-back period of a certain number of prior periods that the taxpayer will pay taxes. The length of the look-back period will depend on several factors, including the nature of the taxpayer’s activities and the size of past years’ potential tax liabilities as submitted in the application. The look-back period will usually be for a minimum of three years for all tax types.
For individual income tax, the Department may extend the look-back period up to five years for those taxpayers who filed their federal income tax returns yet failed to file Georgia income tax returns for those years. For sales and use tax or withholding tax, the look-back period is usually thirty-six months but will be extended as far back as necessary to recover taxes that a taxpayer collected yet did not remit. For corporate income tax, the look-back period depends upon the amount of tax due and the existence of a net operating loss during the period.
If a small amount of tax is due for prior periods, please note that the Department will almost never waive any past liability as part of a prospective, going-forward basis, with no look-back period.
Eligibility
To qualify for the VDA program, the taxpayer (individual or business) must submit an application form and:
Have not been contacted by the Department for enforcement purposes about that tax obligation (e.g., audit or compliance contact regarding registration or reporting requirements)
Are compliant with all other Georgia Department of Revenue tax obligations.
Penalty Waiver
Penalties will generally be waived for all periods included in the VDA agreement. However, interest will still be imposed on all amounts due.
Look-back Period
The Department will normally require a look-back period of a certain number of prior periods that the taxpayer will pay taxes. The length of the look-back period will depend on several factors, including the nature of the taxpayer’s activities and the size of past years’ potential tax liabilities as submitted in the application. The look-back period will usually be for a minimum of three years for all tax types.
For individual income tax, the Department may extend the look-back period up to five years for those taxpayers who filed their federal income tax returns yet failed to file Georgia income tax returns for those years. For sales and use tax or withholding tax, the look-back period is usually thirty-six months but will be extended as far back as necessary to recover taxes that a taxpayer collected yet did not remit. For corporate income tax, the look-back period depends upon the amount of tax due and the existence of a net operating loss during the period.
If a small amount of tax is due for prior periods, please note that the Department will almost never waive any past liability as part of a prospective, going-forward basis, with no look-back period.
