Individual Income Tax

Voluntary Disclosure of Personal Income Tax Liabilities

In seeking to increase the level and ease of compliance with Ohio's tax laws, the Ohio Department of Taxation offers a Voluntary Disclosure Program. This program is designed for individual taxpayers who believe they have income tax liabilities and wish to resolve them. By voluntarily disclosing the liabilities, the individual taxpayers can avoid the consequences normally associated with a nexus investigation, audit or assessment. Any individual is eligible for the program if he/she enters into and executes a Personal Income Tax Voluntary Disclosure Agreement prior to any contact from the Income Tax Division.

If you would like to establish a voluntary disclosure agreement, you or your representative should send a letter explaining in detail your activities in Ohio and how long you have carried out these activities in Ohio. It is not necessary to identify the individual’s name before the voluntary disclosure agreement is prepared. However, an identifier should be used to distinguish the different clients a representative may have.

Send this letter to the following address:

Ohio Department of Taxation
Attn: Voluntary Disclosure Program, 1st Floor
4485 Northland Ridge Blvd.
Columbus, Ohio 43229

Upon receipt of this letter, we will prepare an income tax agreement in duplicate and send both copies to you for you or your representative to sign. Within the time period specified in the agreement, you should sign both originals of the agreement and send both originals to the address shown above, along with your completed individual income tax returns and payment of the tax and interest due (see an example of our interest computation in "Other Information", below). Please make your check payable to the Ohio Treasurer of State. We will then sign one of the agreements and return it to you. 

General terms of the Personal Income Tax Voluntary Disclosure Agreement (subject to certain limitations):

  1. The individual must file the individual income tax returns, form IT-1040, for the income tax return due in the current calendar year and each of the three previous years (four years total) and pay the tax due plus interest.
  2. The individual waives the right for refund for those three previous years. Refund requests will be honored for the returns due in the current year.
  3. The Tax Commissioner is precluded from assessing the individual or requiring it to file income tax returns for taxable years prior to the years covered by the agreement if the individual has not been previously contacted by the Income Tax Division.
  4. The Tax Commissioner may audit the income tax returns filed by the individual for the years covered by the agreement.

Other Information:

Ohio individual income tax forms and instructions are available on our Web site

at Tax Forms

Interest is computed on the net tax due for each calendar year as follows:

# of days interest

365 or 366

x interest rate x Tax due = interest

Interest rates:

Calendar Year

Interest rate:

2008 8%
2009 5%
2010 4%
2011 4%
2012 3%

 

Example:  Interest on a $500 Ohio tax due for 2008 would be computed as follows (assume tax was due April 15, 2009 and was paid on June 15, 2012):

2009 4/15/09 to 12/31/09   260/366 x  5% x $500 =  $ 17.76    
2010 1/01/10 to 12/31/10   365/365 x  4% x $500 =  $ 20.00    
2011 1/01/11 to 12/31/11   365/365 x 4% x $500 =  $ 20.00    
2012 1/01/12 to 06/15/12   167/366 x 3% x $500 =   $  6.84    
Total Interest   --------------------------------->      $ 64.60