HAR § 18-231-3-14.16 — (e) Stay of collection proceedings

The submission of an offer in compromise to the department of taxation shall not automatically stay the collection of any tax liability. However, the director of taxation may defer collection if the State’s interest will not be jeopardized. (f) Acceptance of an offer. An offer in compromise shall only be considered accepted when the taxpayer or the taxpayer’s duly authorized agent receives notice of the acceptance in writing. As a condition to acceptance, the department of taxation may require the taxpayer to enter into collateral agreements, waive tax refunds, or post security to protect the State’s interest. (g) Withdrawal or rejection of an offer. An offer in compromise may be withdrawn by a taxpayer or the taxpayer’s duly authorized agent at any time prior to its acceptance. If an offer is rejected, the taxpayer or the taxpayer’s duly authorized agent shall be notified in writing. Frivolous offers or offers submitted for the purpose of delaying collection of tax liability shall be immediately rejected. If an offer in compromise is withdrawn or rejected, the amount remitted with the offer (including all installments paid), shall be refunded to the taxpayer without interest, unless the taxpayer agrees that the amount remitted may be applied to the liability with respect to which the offer was submitted. (h) Release of lien. The department of taxation shall release any tax lien related to tax liability settled under a compromise agreement upon final payment. If final payment is contingent upon the simultaneous release of the tax lien (in whole or in part), payment shall be made in cash, by check (certified or cashier’s), or money order. (i) Records. Pursuant to section 231-3(10), HRS, a statement containing the following information shall be placed on file in the department of taxation: (1) The taxpayer’s name; (2) The amount of tax assessed or proposed to be assessed; (3) The amount of penalties and interest imposed or which could be imposed by law with respect to the tax, as computed by the department of taxation; (4) The total amount of liability as determined by the terms of the compromise, and the actual payments made thereon with the dates thereof; and (5) The reasons for the compromise. (j) Inspection of records. A copy of the statement on file with the department of taxation pursuant to section 231-3(10), HRS, shall be available for public inspection. Inspection may occur after an appointment is made with the collection division chief of the department of taxation. Upon request, copies of the statement on file pursuant to section 231-3(10) may be obtained at a cost of $1 a page. (k) Statute of limitations. No offer in compromise shall be accepted unless the taxpayer waives the running of the statutory period of limitations on the assessment of tax liability for the taxable years specified in the pending offer or the period ending one year after receipt of final payment on a compromise agreement. (l) Effective date. This section shall take effect upon the enactment of the law making information in subsection (i) available for public review or ten days after the filing of this section with the office of the Lieutenant Governor, whichever is later.