Penalties on taxes might be waived

Tuesday, Feb. 3, 2004 | 9:44 a.m.

CARSON CITY -- An emergency regulation is on its way to Gov. Kenny Guinn that will waive penalties and interest for Nevadans who are still trying to figure out the new taxes imposed by the 2003 Legislature.

A spokesman for Guinn said the governor is expected to sign the regulation, which will be in effect for 120 days.

"The governor feels it is not appropriate to penalize companies that are adjusting to the new, complicated tax law," Guinn's press secretary, Greg Bortolin, said.

The Nevada Tax Commission Monday approved 6-0 the emergency regulation that will allow state Taxation Director Chuck Chinnock to waive interest and penalties if good cause is shown for those who miss the deadline for payroll, live entertainment and use tax returns.

Tax Commission Chairwoman Barbara Smith Campbell said "the governor's office feels it is appropriate to educate the taxpayers." She said the state Taxation Department has had a "short time to ramp up" after the Legislature passed the tax package last July.

This grace period does not cover those who did not pay the $100-a-year business tax.

The normal penalty is 10 percent of the tax due and the interest is one percent a month on the tax due.

There has been confusion surrounding who might have to pay the payroll tax and the live entertainment tax.

The first payment of the gross payroll tax was due Monday for the October-December period. If the business is a few days late and has a valid reason, the penalty and interest could be waived, Chinnock said.

He said earlier there could be such problems as the department sending the tax forms to the wrong address or a mix-up with an accountant for the business.

Under the regulation the person or business would have to file the return before June 1. Each late return will be examined to determine if there is a legitimate reason for the late filing.

The commission also adopted a regulation to allow a homeowner, who falls on hard times, to delay paying property taxes for up to three years. Voters approved a constitutional amendment in 2002, the 2003 Legislature passed the law and now the regulations are going into effect.

The claims must be filed with the county treasurers who will decide if the person meets the guidelines, which include the owner not being in bankruptcy and having income below the federal property level as well as an assessed value of less than $175,000 on the property. Carson City Treasurer Al Kramer said this will benefit a few people. But any homeowner who goes this route faces a "balloon" payment at the end of three years and if that obligation isn't met, the property could be sold to pay the taxes.

The tax commission amended the regulation to require that when the federal income returns of the petitioner and his health records are submitted to the county treasurer, they are kept confidential.