Unanimous Vote Sends House Bill 4003 to the Senate
FROM: The Michigan State Chamber of Commerce Capitol Report
The State House continued its pursuit of legislation to improve Michigan’s tax climate with important administrative reform. House Bill 4003 (Walsh, R-Livonia) provides a codified and transparent “Offer In Compromise” process for taxpayers who cannot pay their full taxes but who want to voluntarily come forward with some type of payment and become compliant. This Chamber-initiated legislation is part of our aggressive agenda to seek operational improvement with how taxes are administered in Michigan.
Michigan is one of only a few states that do not have an Offer in Compromise (OIC) program. Not to be confused with “tax amnesty” programs (which simply allow taxpayers - who are otherwise able to pay - to get out of penalties and interest), an Offer in Compromise is for those who truly cannot pay due to circumstances like bankruptcy, medical expenses or loss of job. The taxpayer must apply, be accepted, and agree to be fully compliant with future liabilities or face penalties.
HB 4003 makes good policy sense because it would help bring in otherwise uncollectable money to the state, allow Treasury to expend its resources in endeavors more productive than chasing uncollectable money, and provide a codified process for taxpayers that would be consistent and transparent for everyone.