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We closed the business, filed personal bankruptcy and moved to a different state. How long can Georgia try to collect sales tax?

Full Question: We closed the business, filed personal bankruptcy and moved to a different state. Sales tax were not covered in the bankruptcy. How long can Georgia try to collect, how much interest and fees can they add and what legal actions can they take? Are my personal accounts and belongings in jeopardy?

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Answer:

Diane Yetter photoIn the case of a false or fraudulent return with the intent to evade taxes or if no return if filed, there is no statute of limitation barring the Department of Revenue from assessing and collecting sales and use taxes due. If there is sales tax collected that you did not remit on behalf of the company, these periods will never close for audit. In terms of actions the Department can take, they can assess liens, impose interest and civil penalties against not only the business but also the officers, owners and other responsible parties. Your personal accounts and assets could be in jeopardy. In addition, the filing of a false or fraudulent dealer's return with the intent to evade tax is a misdemeanor of a high and aggravated nature punishable by a fine of up to $5,000 and/or imprisonment of up to one year. A dealer's actions leading to a violation must be knowingly and willfully. Upon the second or subsequent convictions, the person is guilty of a felony and shall be subject to a fine of up to $10,000 or imprisonment for up to five years, or both. In addition, a penalty of 50% of the tax due is imposed. The fact that you have moved out of state might make it more difficult for Georgia to find you but they do have the ability to attach liens against any property you might have remaining in Georgia and potentially to assert actions even to individuals located outside the state. It is recommended to consult with an attorney to determine options.

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