Under Wisconsin`s new law, restrictions on unanticipated real estate audit systems differ depending on whether the unclaimed property owner is domiciled in Wisconsin or not. For holders domiciled in Wisconsin, the Secretary of Revenue is prohibited from entering into an agreement allowing a third party to conduct unclaimed real estate control on a conditional royalty basis or to acquire information from the review, except for information obtained by the federal government. Such royalty-based plans may continue to be used for unsolicited real estate audits of licensees residing outside Wisconsin. But contingency costs for these agreements are now limited to 12 percent of the total amount of unclaimed real estate that was disclosed by the audit. A voluntary disclosure program or voluntary agreement, often referred to as the VDA, is a binding agreement between a state and a taxpayer that, in theory, benefits both. For states, VDAs can mean more revenue with less effort. For taxpayers, they can limit waiting times (the length of detention that the state can make liable for unpaid taxes), reduce penalties or waive sanctions, and offer some protection for reviews. The information provided here is general in nature and is not intended to respond to the particular circumstances of a natural or legal person. In certain circumstances, the services of a profession should be sought.
Tax information, if included in this communication, was not intended or written to be used by a person to avoid sanctions, nor should this information be construed as an opinion on which a person can rely. Recipients of this notification and potential seizures are not subject to a restriction on disclosure of the processing or tax structure of the transactions or material subject to this notification and possible seizures. By expanding their multi-state footprint, companies may have created physical exposure due to compounding and unfulfilled tax reporting obligations. To support your compliance goals, we have a team dedicated to voluntary disclosure agreements. As part of this process, our voluntary revenue tax advertising team provides the following services: Specific rules vary from state to state, but voluntary disclosure of VAT by a VDA is generally a great way to ensure that your business complies with the IRS. If, for fear that your non-registration may not be reported, you have objected to the voluntary VAT advertising program, you should be aware that the information you provide under a VDA program cannot be used by law against you, unless you violate the terms of the VDA. On April 3, 2018, Wisconsin passed Assembly Bill 773, 2017 Wis. Act 235, which sets the date on which the Secretary of Revenue may use contingency royalty agreements with third parties conducting unclaimed real estate audits. As in many other states, the Wisconsin Department of Finance has in recent years commissioned audit firms to conduct unclaimed real estate audits based on contingency fees. Owners of unsolicited real estate have often criticized these agreements and have argued that such agreements encourage third-party companies to conduct overly aggressive audits and increase compliance costs.