This Policy Statement has been superseded by PS 92(4.1)
Your Rights As a Connecticut Taxpayer
The Department of Revenue Services (DRS) works hard to ensure that Connecticut's tax laws are enforced fairly and that honest taxpayers do not have to shoulder an unfair burden. As a Connecticut taxpayer, you have the right to be treated professionally, fairly, promptly and courteously by DRS and its employees.
The booklet discusses some general rules and procedures that we follow. It explains what happens during and after an actual audit, including your appeal rights within DRS and the court system. We encourage you to learn about your rights and exercise them to the fullest.
COURTESY AND FAIRNESS
If you feel that you are not being treated fairly, courteously and considerately by any department employee, please contact our Taxpayer Advocate at (203) 297-5603.
PRIVACY AND CONFIDENTIALITY
Under the law, we must protect the privacy of your tax information. People who prepare your return or represent you must also keep your information confidential.
We can share your tax information with other state tax departments, Connecticut municipalities, certain other state agencies, and with the Internal Revenue Service. Changes on your federal income tax return may affect your state returns, and state changes may affect your federal return.
You have the right to know why we are asking you for information, and what might happen if you do not provide that information.
Throughout your dealings with us, you can represent yourself or you can designate an authorized employee of yours to represent you. With proper written authorization, you can also have an attorney, accountant, enrolled agent or other person, such as a family member, represent you at an audit or conference. If your representative attends a conference without you, he or she may receive or inspect confidential information as long as you have given him or her a written power of attorney (Form LGL-001). If you need a copy, you can get one by calling 1-800-382-9463.
THE AUDIT PROCESS
DRS accepts most state tax returns as filed. However, the Audit Division examines a percentage of returns to verify various reported items. If your return is selected for audit, it does not suggest that you made an error or are dishonest. Returns selected for audit are chosen by computerized audit selection or by random sample. Other sources include information developed in another audit, or information received from the federal government or another state.
IF YOU ARE AUDITED
If we inquire about your return or select it for audit, you will not necessarily have to pay more tax. We may close your case without change, or you may receive a refund. Connecticut tax audits are conducted by our revenue examiners by mail, at our office, at your place of business or sometimes at the office of your attorney or accountant. If the time and place is inconvenient for you, the examiner will try to work out something more suitable.
OFFICE AUDITS BY MAIL
Most office audits are handled through the mail. We will write you requesting more information or stating a reason why we believe your return should be changed. If you provide the requested information, we may or may not agree with you. However, we will fully explain the reasons for any adjustments. If we cannot resolve your questions, you may request a personal interview.
CONDUCTING THE FIELD AUDIT
An audit usually begins when we notify you that your return has been selected. We will tell you which records you will need to show us. If we propose any changes to your return, we will explain, in writing, the reasons for the changes to you or your authorized representative. It is important that you understand the reasons for any proposed change. You should not hesitate to ask about anything that is unclear to you.
COMPLETING THE AUDIT
At the conclusion of the audit, you will receive a copy of the Tax Determination Report that summarizes any proposed audit adjustments and pertinent audit work papers which you should keep with your tax records. The report will also show any additional tax, interest due and applicable penalty. If you agree to the changes proposed by the revenue examiner, the audit is closed.
AUDIT ASSESSMENT PAYMENTS
Between the time you receive the Tax Determination Report and the formal filling from an audit, one or more months of additional interest charges may accrue. To avoid additional interest, you can make an advance payment on an audit assessment. To do so, include a copy of the Tax Determination Report, and mail the payment indicated as due in that report to the Department of Revenue Services, Audit Division, Selection & Control Unit, 25 Sigourney Street, Hartford, CT 06106.
Partial payments are first applied to penalties, then interest, and any balance is then applied to the tax due. Any tax not paid will continue to accrue interest. Payments made to stop interest from accruing do not affect your appeal rights.
You may also make a payment on only specific items with which you agree. Such a payment of tax and interest must be made by requesting Form LGL-005 by which you concede the specific errors for which payment is made. This waives your rights to file a claim for refund for the amount so paid.
THE APPEAL PROCESS
At the conclusion of your audit, if you agree to the changes proposed by the revenue examiner, your case can be closed. If you disagree, we have an informal and formal appeals process. Most differences can be settled within this system. However, the reasons for your disagreement must come within the scope of tax laws. For example, you cannot appeal solely on moral, religious, political, conscientious, or similar grounds.
IF YOU AGREE
If you agree with the proposed assessment, your audit will be processed and you will receive an official audit billing (even if the balance is $0.00), which you should keep. If you only partially agree with an assessment, you can file Form LGL-005 and pay the uncontested portion. You must pay interest on any additional tax, which is generally calculated from the due date of your return to the billing date. You can stop the accumulation of additional interest charges by paying the entire amount.
INFORMAL APPEALS (WITH AUDIT DIVISION)
If you still disagree with the audit adjustments, before the official billing is make, you can request an informal conference with representatives of the Audit Division. If you want an informal conference, contact the manager or supervisor in the office that conducted the audit. You must request the informal conference by the date indicated on the Tax Determination Report. You must also clearly set forth the reasons that you disagree with the audit findings.
At the informal conference, you should be prepared to discuss all disputed issues. Many differences are settled at this level. You should submit any documentation necessary to support your position. At the completion of the informal conference, adjustments, if any, will be made to the audit assessment and the audit is then processed and forwarded for official billing.
FORMAL APPEALS (WITH APPELLATE DIVISION)
After you receive your official audit bill and you still disagree with the findings, you can then request a formal conference with the Appellate Division. The request must be in writing and be sent within the time limit specified on the audit billing. The request must contain:
The request must be postmarked within sixty (60) days of the date of the first official audit bill and clearly state, in writing, the protested issues. Formal Hearing requests must be sent to:
If the assessment cannot be settled to your satisfaction within DRS, you can then take your case to court within thirty (30) days of receiving our determination.
COLLECTION, ENFORCEMENT AND PAYMENT
When you owe tax, DRS will send you a bill describing the tax and stating the amounts you owe in tax, interest, and penalties. If you believe that the bill is incorrect, please telephone the number listed on the bill. You must pay interest on any additional tax that you owe.
Interest is computed from the due date of the return to the date of the bill. If you think that you will owe additional tax at the end of the examination, you can stop the further accrual of interest. You can send a payment to DRS to cover all or part of the amount you think you will owe.
As a result of your audit or other bills, certain penalties can be assessed in addition to the tax and interest charges. We will explain penalties to you at the conclusion of the audit.
Once the audit, including penalty charges, has been billed, you have the right to request a penalty waiver. Requests must be in writing and contain a clear and complete explanation. They should be addressed to:
If you are unable to pay your entire bill, you should pay as much as you can and immediately contact the DRS Collections and Enforcement Division. Based on your financial condition and history, you may qualify for an installment agreement. If we approve one, the arrangement will stay in effect only as long as you give correct and complete financial information. Approval is based on your payment history, prompt payment of current tax liabilities, and a decision that you are not a collection risk.
Normally we will not take enforcement action until after we have tried to contact you and have given you the chance to voluntarily pay any tax due. Criminal violations of the Connecticut General Statutes are subject to immediate enforcement action. Therefore, it is very important to immediately respond to our attempts to contact you by mail, telephone or personal visit. If you do not respond, we must begin enforcement action.
TAXPAYER ADVOCACY PROGRAM
We have a Taxpayer Advocacy Program to provide special help for taxpayers who have been unable to resolve their problems through normal channels. If you have a tax problem that is not in litigation or subject to enforcement action, and you cannot clear the matter up through normal channels, write to the Taxpayer Advocacy Office, Department of Revenue Services, 25 Sigourney Street, Hartford, CT 06106.
The Taxpayer Advocacy Program cannot change the tax law or technical decisions, but can help you solve administrative or procedural problems.
You have the right to information and help in complying with Connecticut's tax laws. In addition to the basic instructions provided with the tax returns and forms, we make a great deal of other information available, and offer taxpayer assistance over the phone at 1-800-382-9463.
You can order DRS forms and publications by calling toll free from within Connecticut, 1-800-382-9463, or in the Greater Hartford area, 297-5962.
TAX RETURN COPIES
If you need a copy of your tax return for an earlier year, you can get one by filling out Form LGL-002. You can request the form by calling 1-800-382-9463 or by sending a written request to:
Department of Revenue Services
We provide walk-in assistance at our Hartford location and the five regional offices located throughout Connecticut.