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State Issues

Most State tax enforcement piggybacks on IRS compliance enforcement results.  For example, if a taxpayer is audited, the State will generally require the taxpayer to file an amended return after the audit or the State will automatically assess similar adjustments to the taxpayer’s state income tax return.


Most State tax problem solving options mirror the IRS procedures.   However, there are some notable differences:


  • Many States do not clearly publish their rules and options for resolving back taxes and penalty abatement.

  • Many States normally do not follow a consistent process before enforcement.  For example, some States speed up the collecting of back taxes through local collection efforts rather than sending multiple notices requesting payment.

  • Most State Departments of Revenue do not readily provide written account information.  Many taxpayers do not have access to State tax account transcripts to understand their transactions and activity at the State level.

  • State statute of limitations for assessment and collection of taxes often are longer than the IRS statutes.  Why? many states conduct investigations and adjust accounts after IRS compliance results are sent to them. This delay requires States to need more time than the IRS allows for assessment and collection of taxes.

Taxpayers may have to navigate both federal (IRS) and State issues simultaneously.  It is not easy to get information on State actions and taxpayer account details.  Phil and his team can help by contacting the State DOR directly and help you interpret your information and options.

Need help with an State tax problem? Contact us today.

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