May 31 is Deadline for Tax Shelters Voluntary Compliance

For Release: May 30, 2008
Contact: Jessica Iverson, Communications Officer, (608) 266-2300

MADISON — The 2007-09 Budget Bill (2007 Act 20) enacted the Tax Shelters Voluntary Compliance Program to encourage taxpayers to pay taxes they may have previously avoided with tax avoidance transactions, or “abusive tax shelters.” The program began January 1, 2008 and ends on May 31, 2008.

During the program, Wisconsin waives all penalties relating to tax avoidance transactions for taxpayers who voluntarily disclose their participation in those transactions.The program also phases in new requirements to specifically disclose “reportable transactions” to Wisconsin whenever those transactions are required to be specifically disclosed to the Internal Revenue Service (IRS).

In 2007, DOR participated in the Multistate Voluntary Compliance Program along with 23 other states, collecting more than $1.5 million through that initiative.

Any taxpayer who has used a tax avoidance transaction to reduce or eliminate Wisconsin income or franchise tax liability for any tax year beginning on or after January 1, 2001 and before January 1, 2007, is eligible. A “tax avoidance transaction” is a plan or arrangement devised for the principal purpose of avoiding federal and Wisconsin income or franchise taxes, or of avoiding Wisconsin income or franchise taxes without affecting federal tax liability.

To participate, eligible taxpayers must do the following by May 31, 2008:

For more information, please visit www.revenue.wi.gov.

Page last updated June 4, 2008