States to Clarify ‘Lookback Period’ in Tax Settlement Program

The Multistate Tax Commission plans to revise features of a tax settlement program to sharpen its application of the time period used to determine a taxpayer’s exposure for unpaid sales and use taxes, and employer withholding taxes.

The commission will clarify that the so-called lookback period for taxes that were collected but not remitted to agencies begins when the taxpayer starts collecting taxes—even if it predates the statutory or conventional multiyear lookback period. The clarification applies to the MTC’s Multistate Voluntary Disclosure Program, which gives businesses with tax liabilities in multiple states an opportunity to negotiate settlements under uniform ...