The
Rhode Island Division of Taxation today issued a reminder to state and local government
employees about Rhode Island’s Public Employee Tax Compliance Act.
Under
that law, the State of Rhode Island and all political subdivisions (including
cities, towns, and other entities, such as fire districts) must periodically
provide a list of their employees to the Rhode Island Division of Taxation.
The
Division of Taxation must use the information from each such list to determine if
any of the employees may be delinquent on their Rhode Island state taxes. If
so, the Division must send each such person a notice that the taxpayer may not be
in compliance.
Two recent mailings
The
Division of Taxation recently sent out approximately 3,600 such notices, in two
separate mailings:
- The first notice -- in a mailing on December 13, 2017 -- says that the recipient might not be in compliance with Rhode Island state tax laws because the recipient did not file a 2016 Rhode Island personal income tax return. (The recipient is advised to file a completed and signed return -- or provide a letter of explanation.)
- The second notice -- in a mailing on December 29, 2017 -- says that the recipient might not be in compliance with Rhode Island state tax laws because the recipient has a Rhode Island tax balance due.
Overall, the Division mailed “tax balance
due” notices to:
- 1,194 city/town/local employees - out of a total of 28,777 city/town/local employees reviewed
- 742 state employees - out of a total of 15,093 state employees reviewed
- 1,152 city/town/local employees - out of a total of 28,777 city/town/local employees reviewed
- 490 state employees - out of a total of 15,093 state employees reviewed
Details of notices
Each notice advises that
if the recipient fails to take corrective action by a certain date in January
2018, the Division will begin the steps necessary to garnish wages. Each notice also shows how the recipient may obtain
information about taxpayer rights and responsibilities. (In each notice, the
Division of Taxation is required by law to include information about wage
garnishment and about taxpayer rights. Each notice also includes information on
how to contact the Division of Taxation.)
If
any public employees feel that they have received one or more of these notices
in error, they should contact the Division’s Collections section immediately. (See below for details.) The
Division is always ready and willing to work with taxpayers and/or their
advisors. In this matter, the agency has allocated extra resources to make sure
that it responds as quickly as possible – and to proactively confirm the
delinquency, or let the taxpayers know that they are current on their filing
and payment obligations.
Projected amount owed
Overall,
the notice recipients owe a projected $2,884,042 in Rhode Island state taxes in
the aggregate. (The average owed is $1,490. The mean amount owed is $293.) However,
for a variety of reasons, it is possible that some, or all, of the projected
amount in any given notice sent by the Division may not ultimately result in an
owed tax debt. For example, a person’s proposed delinquency as shown in the
notice may not reflect the impact of a carryforward from a prior tax year.
Background
Legislation enacted in 2014 created the “Compliance of Public Employees With State Income Tax Act”. (The short title is the “Public Employee Tax Compliance Act”.) The Division sent out its first round of notices to delinquent public employees shortly after the legislation was enacted. As a result, the Division has collected $632,231 through October 2017.
The
second round of such notices was mailed last month – following the Division’s multi-year
project involving the conversion to a new agency-wide computer system.
The
Public Employee Tax Compliance Act is contained in Rhode Island Public Law 2014, chapter 145, article 12, § 3, which is codified at Rhode Island General Laws § 44-69-1 et seq.
To contact the Division of
Taxation’s Collections section, call (401) 574-8941 from 8:30 a.m. to 3:30 p.m.
business days, or email: Tax.Collections@tax.ri.gov. The Collections section is
located in the Division of Taxation office, which is at One Capitol Hill,
Providence, Rhode Island, diagonally across from the Smith Street entrance of
the State House.
