Taxpayer Bill Of Rights  

 

Act 50 Taxpayer Bill of Rights

This is a list of your rights as they relate to an audit performed by Berkheimer; a request you may have for a refund of taxes paid by you; the steps you may take to appeal an audit determination or denial of a refund; and the steps Berkheimer can take to collect unpaid taxes.

These rights apply to the collection of the following kinds of taxes: earned income tax; net profits tax; occupation assessment tax; occupation privilege tax; business privilege tax; mercantile tax; amusement / admission tax; and per capita tax.

When you request it, Berkheimer must supply you with a copy of these written rights, at no charge to you.

When you pay a local tax, Berkheimer must apply your payment first to the tax due; then to interest due, if any; next, to penalties due, if any; and finally, to other fees and charges, if any.

Your rights during an audit.

If you receive a letter from Berkheimer requesting additional information about your tax returns or tax liability, i.e., an “inquiry letter,” you have thirty (30) days from the date the letter is mailed to respond to it.

  • Example: Berkheimer sends to Taxpayer a letter asking her to send in a copy of her W-2 form for the past tax year. Taxpayer has thirty days to respond to our letter by sending in her W-2 form.

If you need additional time to respond to a letter requesting more information, you may write to Berkheimer or call us at (800) 360-5555 ext. 2 to ask for more time to respond to our letter. If you write for an extension of time to respond to our inquiry letter, Berkheimer will inform you in writing as to whether your request has been granted. If you call to make your request, we will inform you of our decision at that time and send you a letter verifying our decision. Your request for additional time to respond to our inquiry letter must state all the reasons why you need extra time.

  • Example: Berkheimer sends to Taxpayer a letter asking her to send in a copy of her W-2 form for the past tax year. Taxpayer calls Berkheimer to say that she will need an extra ten days to find her W-2 form because her tax records are with her accountant who is away on vacation. Berkheimer grants her request over the phone and sends a letter to verify that she has forty (40) days to respond to our request.
  • Example 2: Berkheimer sends to Taxpayer a letter asking her to send in a copy of her W-2 form for the past tax year. Taxpayer sends a letter to Berkheimer to say that she will need an extra ten days to find her W-2 form because her tax records are with her accountant who is away on vacation. Berkheimer grants her request and sends a letter to verify that she has forty (40) days to respond to our request.

Berkheimer cannot take any action against you until the thirty (30) day response period has expired. If you have been granted an extension of time to respond to our inquiry letter, that extra time must also expire before Berkheimer can take other action.

  • Example: Berkheimer mails a letter to Taxpayer on November 1 asking her to send in a copy of her W-2 form for the past tax year. Taxpayer has until December 1 to respond to our request. Berkheimer cannot send out any other notices or letters to Taxpayer until after December 1.
  • Example 2: Berkheimer mails a letter to Taxpayer on November 1 asking her to send in a copy of her W-2 form for the past tax year. Taxpayer sends a letter to Berkheimer to say that she will need an extra ten days to find her

W-2 form because her tax records are with her accountant who is away on vacation. Taxpayer has until December 11 to respond to our request. Berkheimer cannot send out any other notices or letters to Taxpayer until after December 11.

If Berkheimer wants proof that you filed tax returns or paid taxes for prior tax years, i.e., for tax years other than the most current, we can only ask about the three (3) prior tax years.

  • Example: Berkheimer sends a letter to Taxpayer on November 1, 1999 requesting copies of prior year tax returns.

Berkheimer can only ask for tax returns for the prior three (3) years, i.e., for the tax years 1996, 1997 and 1998.

If Berkheimer finds that you have failed to file a tax return for the previous three years, or if we find that you underreported income for the previous three years, or if we find that you failed pay the tax due for the three prior years, we can send to you additional notices or letters.

  • Example: Berkheimer sends a letter to Taxpayer on November 1, 1999 requesting copies of prior year tax returns for 1996, 1997 and 1998. Taxpayer cannot find his 1997 tax return and Berkheimer does not have record that a return for that year was filed. We can send additional notices to the Taxpayer requesting that a 1997 tax return be filed and the tax paid.
  • Example 2: Berkheimer sends a letter to Taxpayer on November 1, 1999 requesting copies of prior year tax returns for 1996, 1997 and 1998. Taxpayer sends copies of the returns requested on November 29. After reviewing same, Berkheimer finds that Taxpayer did not report $1,000.00 of income for 1997. We can bill Taxpayer for the additional tax due on the additional $1,000.00 of income reported for 1997.
  • Example 3: Berkheimer sends a letter to Taxpayer on November 1, 1999 requesting copies of prior year tax returns for 1996, 1997 and 1998. Taxpayer sends copies of the returns requested on November 29. After reviewing same, Berkheimer finds that Taxpayer did not pay any of the taxes reported on any of his returns. We can bill Taxpayer for delinquent taxes due.

If Berkheimer knows that you failed to file a tax return or that you failed to pay a tax which was due more than three (3) years prior to the date of our notice, we can send to you additional notices or letters.

  • Example: Through its records, Berkheimer knows that Taxpayer has not filed tax returns for the 1994 tax year. Berkheimer sends a letter to Taxpayer on November 1, 1999 telling him that a return must be filed. Taxpayer still does not file or pay his 1994 taxes. Berkheimer can send additional notices or bill Taxpayer for 1994 taxes due.

Berkheimer can ask you to send copies of your federal tax return if we have information which we need to collect the local tax and it is information which Berkheimer cannot get from other sources or from the Pennsylvania Department of Revenue.

  • Example: Berkheimer sends a letter to Taxpayer on November 1, 1999 requesting copies of her Schedule C filed with her 1997 federal income tax return. Berkheimer needs her Schedule C to verify the amount of net profits reported on her local earned income tax return. Taxpayer filed a copy of her federal Schedule C with her Pennsylvania state income tax return. Taxpayer must send a copy of her federal Schedule C as requested.

If Berkheimer says you owe more taxes.

If Berkheimer determines that you owe an additional tax, the collector must advise you in writing of the following:

  • the tax years/quarters for which more tax is due;
  • the amount due for each tax year/quarter;
  • the legal grounds for our determination that additional taxes are due; and
  • a list of changes Berkheimer has made to any tax return filed by you which is the reason for our determination that additional taxes are due.
  • penalties and interest due on additional taxes due by you may be removed if:
  • the local taxing body caused you to not to pay the additional tax due or to pay it late; or
  • Berkheimer caused you to not to pay the additional tax due or to pay it late.

Penalties and interest due on additional taxes must be removed if either the local taxing body or Berkheimer gave you specific written advice that you relied upon in response to a specific question regarding your taxes based upon complete and correct information supplied by you.

  • Example: Taxpayer sends a letter to the taxing body. She wants to know if bonuses from her employer are taxable for purposes of the earned income / net profits tax. The taxing body states that she does not owe Berkheimer tax. Berkheimer audits her tax return and discovers that she has not paid tax on this income. Berkheimer bills her for the tax due on the bonuses from her employer. Penalties and interest must be waived because Taxpayer relied upon the advice given to her from the taxing body.

Your right to a refund.

If you have overpaid a tax or paid a tax in error, you may send a written request for a refund of the amount overpaid. Your written request for a refund can take the form of a letter which states all the reasons why you feel a refund is due you.

Refund requests for earned income / net profits, business privilege / mercantile, amusement / admissions, and occupation privilege taxes: You must send your written refund request to Berkheimer within three (3) years of the date that the tax return was due or within one (1) year from the date when you paid the tax, whichever is later

  • Example: Taxpayer seeks a refund of earned income taxes for the tax year 1997. She filed her return on April 1, 1998 and paid her taxes on the same date. Her 1997 earned income tax return and payment were due by April 15, 1998. She must send her letter to Berkheimer asking for her refund by April 15, 2001.
  • Example 2: Taxpayer seeks a refund of earned income taxes for the tax year 1992. She did file her tax return on April 15, 1993, the date that it was due. She did not pay the tax to Berkheimer until December 1, 1997. Taxpayer must send her letter to Berkheimer asking for her refund by December 1, 1998.

Refund requests for per capita and occupation assessment taxes: You must send your written refund request to Berkheimer Associates within three (3) years of the date that the tax was due or within one (1) year from the date when you paid the tax, whichever is later.

  • Example: Taxpayer seeks a refund of occupation assessment taxes for the tax year 1997. She paid her taxes on August 1, 1997, the date which it was due. She must send her letter to Berkheimer asking for her refund by August 1, 2000.
  • Example 2: Taxpayer seeks a refund of occupation assessment taxes for the tax year 1992. She did not pay the tax to Berkheimer until December 1, 1997. Taxpayer must send her letter to Berkheimer asking for her refund by December 1, 1998.

If you have paid a tax as a result of your receiving a notice from Berkheimer informing you of delinquent taxes due, and then seek a refund of the tax paid, you must send your written request to us within one (1) year of the date of payment.

  • Example: Taxpayer receives a notice from Berkheimer advising him that he owes to us an additional $100 of earned income tax for 1997. He pays the tax on December 12, 1998 in order to avoid further collection action. Taxpayer later determines the additional tax was not due and wants a refund. He may send his letter to Berkheimer asking for a refund by December 12, 1999.

If you file a tax return showing an overpayment of tax, your return is considered a written request for a cash refund unless you state on the return that you desire a credit.

  • Example: Taxpayer files her 1998 earned income tax return showing an overpayment of $100. She does not check either box on the return to show that she wants a refund or credit. Taxpayer can receive a cash refund of $100.
  • Example 2: Taxpayer files her 1998 earned income tax return showing an overpayment of $100. She checks the box on the return showing that she wants a credit toward next year’s tax. Taxpayer can receive a credit.

You are entitled to interest on refunds for overpayment of taxes. Interest is calculated from the date of the overpayment until the date written on the refund check.

The rate of interest on refunds for overpayment of taxes can change from year to year.

You will not receive interest on refunds which are paid to you by Berkheimer within 75 days of the date that a tax return was due to be filed or within 75 days of the date your tax return is actually filed, whichever is later.

  • Example: Taxpayer files his 1998 earned income tax return on April 1, 1999, showing an overpayment of tax of $25. His 1998 tax return is due by April 15, 1999. Berkheimer sends to Taxpayer a refund check in the amount of $25 on July 1. No interest is due to Taxpayer.
  • Example 2: Taxpayer files his 1998 earned income tax return on January 15, 2000, showing an overpayment of tax of $25. His 1998 tax return was due by April 15, 1999. Berkheimer sends to Taxpayer a refund check in the amount of $25 on February 15, 2000. No interest is due to Taxpayer.
  • Example 3: Taxpayer files his 1998 earned income tax return on April 1, 1999, showing an overpayment of tax of $25. His 1998 tax return is due by April 15, 1999. Berkheimer sends to Taxpayer a refund check in the amount of $25 on August 15, more than 75 days after his tax return was due to be filed. Interest is due to Taxpayer.

If you have overpaid on interest or penalties due on delinquent taxes, you are not entitled to interest.

  • Example: Taxpayer owes to Berkheimer $100 of delinquent earned income taxes and an additional $12 of penalties and interest on the delinquent taxes. She pays $120 total to satisfy the unpaid tax, penalty and interest. She applies for a refund of $8 for the penalty and interest which was overpaid. No interest is due to Taxpayer.

If you cash or deposit our refund check, this will not stop you from requesting any additional refund of tax or interest.

  • Example: Berkheimer sends to Taxpayer a check for $100 which is a refund of 1994 taxes, with interest, requested by him. Taxpayer cashes the check. Taxpayer later determines that he overpaid a 1995 tax and seeks an additional refund. Taxpayer can make this request for a second refund even though he already received and cashed a prior refund check.

Your right to appeal.

(Where Berkheimer is the Tax Hearing Officer)

If your request for a tax refund is denied by Berkheimer, or if we say you owe to us more taxes, you may file a petition with Berkheimer to appeal our decision. A copy of the petition form is enclosed.

A written request for a refund or a letter disputing a deficiency assessment is NOT a petition for appeal. You must use the enclosed form.

A petition is timely filed if the letter transmitting the petition is postmarked by the United States Postal Service on or before the final day on which the petition is required to be filed. The deadlines for filing a petition to appeal a request for refund are as follows:

Petitions to appeal earned income / net profits, business privilege / mercantile, amusement / admissions, and occupation privilege taxes: Within three (3) years from the date the tax return was due or within one (1) year from the date a payment of the tax was made, whichever is later.

Petitions to appeal per capita and occupation assessment taxes: Within three (3) years from the date the tax was due to be paid or within one (1) year from the date the tax was actually paid, whichever is later.

  • Example: Taxpayer wants to file his petition to appeal a request for refund of his 1998 earned income taxes. His 1998 local earned income tax return was due to be filed on or by April 15, 1999. Taxpayer must file his petition for appeal on or before April 15, 2002.
  • Example 2: Taxpayer wants to file his petition to appeal a request for refund of his 1998 per capita tax. His tax payment was due on July 1, 1998, but he did not pay it until January 7, 2003. Taxpayer must file his refund petition on or by January 7, 2004.

A petition to appeal an assessment of additional tax must be filed within ninety (90) days of the date of the delinquency or assessment notice.

  • Example: Taxpayer receives a notice from Berkheimer that she owes an additional $200 in tax. The date of the notice is August 1, 1999. Taxpayer must file her petition to appeal the assessment on or before November 1, 1999.

Your petition to appeal a tax refund request must contain the following information:

  • Your name, address and local telephone number;
  • The name of the taxing district(s) which you claim owes you a refund;
  • The type of tax at issue;
  • The tax year(s) for which you are requesting a refund;
  • The date you originally requested a tax refund;
  • A copy of any local tax return which may be associated with your tax refund request;
  • Copies of all federal and/or state returns and/or schedules which may relate to your tax refund request;
  • A copy of your written refund request; and
  • A written statement from you explaining all the reasons why you feel a tax refund is due to you.
  • The petition must be signed and dated by you.

Your petition to appeal an assessment for additional taxes must contain the following information:

  • Your name, address and local telephone number;
  • The name of the taxing district(s) which claims you owe additional taxes;
  • The type of tax at issue;
  • The tax year(s) for which you may owe the additional tax;
  • The date of the delinquency or assessment notice you received;
  • A copy of any local tax return which may be associated with your petition for appeal;
  • Copies of all federal and/or state returns and/or schedules which may relate to your petition for appeal;
  • A copy of the delinquency or assessment notice you received; and
  • A written statement from you explaining all the reasons why you feel an additional tax is not owed to Berkheimer by you.
  • The petition must be signed and dated by you.

Petitions which are not fully completed will be returned to you as unfilled. Petitions which are not timely filed will be denied.

Your petition for appeal must be sent to Berkheimer, Department of Appeals, 1883 Jury Road, Pen Argyl, Pennsylvania 18072.

Upon our receipt of your fully completed petition for appeal, your account will be assigned to a Tax Hearing Officer who will notify you of the time, date and place of the hearing on your petition. The Tax Hearing Officer may, in his or her discretion, deny your petition if you fail to appear for the hearing.

At the hearing, you will have the opportunity to present any facts, documents, witnesses or other evidence to support your petition.

A decision will be made and sent you in writing within sixty (60) days of the date your petition is postmarked by the Post Office. If the Tax Hearing Officer does not make a decision and tell you of it within the allotted sixty (60) days, your petition is automatically approved.

If you disagree with the decision of the Tax Hearing Officer, you may appeal the matter to the court of common pleas in your county.

If you fail to file a tax return or pay a tax which is due.

Berkheimer can garnish your wages to collect any unpaid earned income, net profits, per capita, occupation assessment, or occupation privilege taxes. Before Berkheimer can contact your employer, we must send to you a notice telling you that a wage attachment will be done if the delinquent taxes are not paid. This notice will be sent by certified mail at least fifteen (15) days before Berkheimer will attach your wages. If you receive a notice before wage attachment, you may contact Berkheimer in order to pay your tax.

Berkheimer can also levy and sell your personal property to make payment of any taxes due and owing by you. You will receive a “Distraint for Taxes” notice from us which places a levy on your personal property. Within ten (10) days of your receipt of this notice, you may contact Berkheimer to settle your account or you may demand a hearing before your local magistrate.

Berkheimer can also file a civil lawsuit against you to collect any unpaid taxes due by you. Except for earned income / net profits taxes, there is no statute of limitations for filing a civil suit to collect delinquent taxes. Generally, suits involving unpaid earned income / net profits taxes must be filed within three (3) years from the date a tax return was due or from the date when a tax return was actually filed, whichever is later. There is no statute of limitations for filing civil suits to collect unpaid earned income / net profits taxes if a taxpayer has not filed a tax return or in cases of tax evasion.

If you have failed to file an earned income / net profits tax return, you may be subject to a fine of up to $500.

If you fail to file business privilege / mercantile, occupation privilege, or amusement / admission tax returns, you may be subject to similar fines.

You may also be subject to penalties, interest and additional costs due on any delinquent, unpaid taxes.

If you cannot pay a tax due and owing by you, you can contact Berkheimer in order to arrange a payment plan. Berkheimer will arrange with you a monthly payment plan that is acceptable to us and you. If we believe that your financial condition has significantly changed, we can ask you to send to us an update on your finances. Berkheimer can change or terminate any payment plan, if:

  • Berkheimer finds that the information provided to us was inaccurate or incomplete;
  • Berkheimer believes that there is a danger you cannot make your payments under the plan;
  • You fail to make any payment under the plan at the time it is due;
  • You fail to pay any other taxes which you owe to Berkheimer at the time they are due; or
  • You fail to provide a financial condition update if requested by Berkheimer.

If Berkheimer must change or terminate any payment plan, we must give you thirty (30) days notice and tell you the reasons why we are changing or ending the payment plan.

You may prepay, i.e., pay off early, any delinquent tax which is subject to an installment payment plan.

And finally . . .

Any information which Berkheimer receives from you about your income, salary, wages, taxes because of a tax return you have filed with us, taxes you have paid to us, a request for refund you have sent to us, a petition for appeal filed by you, or hearing before a Tax Hearing Officer is CONFIDENTIAL. Berkheimer cannot share this information with any other person, except for representatives of the taxing district, or except as required by law.

If you have a concern or complaint about our notices or tax forms, personal representatives, or any other question about Berkheimer, you can send your question in writing to us at 50 North Seventh Street, Bangor, Pennsylvania 18013. We will review your concern and respond accordingly.

Petition for Appeal.

If you would like to file a Petition for Appeal please click here to download the Act 50 Petition For Appeal form. In order to view and print the form you will need Adobe Acrobat on your computer.

After you download the form you may fill it out and send it to this address:

Berkheimer
Department of Appeals
1883 Jury Road
Pen Argyl, PA. 18072