Unpaid sales tax by state: penalties, payment plans and personal liability

Michigan's 6% sales tax is administered by the Michigan Department of Treasury. If a business falls behind, Treasury adds penalty and interest, can file a state tax lien, and can pursue responsible officers personally. Treasury offers installment agreements to businesses that can't pay in full, but penalties and interest keep running while you pay.

California sales and use tax is administered by the California Department of Tax and Fee Administration (CDTFA), not the Franchise Tax Board. The statewide base rate is 7.25% plus district taxes. CDTFA offers online payment plans, an Offer in Compromise mainly for closed businesses, and appeals through CDTFA and then the Office of Tax Appeals.

Texas sales tax is administered by the Texas Comptroller of Public Accounts. The state rate is 6.25%, and local taxes can add up to 2%. Late tax draws a 5% penalty, a second 5% after 30 days, and a $50 late filing fee. Unfiled periods are estimated. The Comptroller considers penalty waiver requests and payment arrangements.

Florida sales tax is administered by the Florida Department of Revenue. The general state rate is 6%, plus county discretionary sales surtax. Dealers who fall behind face penalties, interest, liens and warrants, and responsible persons can be held personally liable. The Department can enter into stipulated time-payment agreements with dealers who can't pay in full.

New York sales tax is administered by the NYS Department of Taxation and Finance. The state rate is 4% plus local rates. New York aggressively pursues responsible persons personally for unpaid sales tax. If you have a bill you can't pay within 60 days, you can request an installment payment agreement; disputes go to conciliation or the Division of Tax Appeals.

Illinois sales tax is legally the Retailers' Occupation Tax, administered by the Illinois Department of Revenue (IDOR) at a 6.25% state rate plus local taxes. IDOR can hold responsible officers personally liable and offers payment plans. Disputes over $15,000 in tax for a period can go to the Illinois Independent Tax Tribunal, which charges a $500 filing fee.

Ohio sales and use tax is administered by the Ohio Department of Taxation at a 5.75% state rate plus county and transit rates. Unpaid assessments can be certified to the Ohio Attorney General for collection, and officers responsible for remitting can be held personally liable. Assessments can be challenged with a petition for reassessment, then the Board of Tax Appeals.

Pennsylvania sales tax is administered by the Department of Revenue at 6%, plus 1% in Allegheny County and 2% in Philadelphia. Unpaid tax draws penalties and interest, can lead to liens and loss of the sales tax license, and officers can be held personally liable. The Department offers payment options, and disputes go to the Board of Appeals and then the Board of Finance and Revenue.

Washington retail sales tax is administered by the Washington Department of Revenue at a 6.5% state rate plus local rates. Washington has no income tax, so the same receipts also face business and occupation (B&O) tax. Unpaid balances can lead to tax warrants, and RCW 82.32.145 lets the Department hold responsible individuals personally liable for collected tax.

Arizona doesn't have a traditional sales tax. It has a transaction privilege tax (TPT) imposed on the seller for the privilege of doing business, administered by the Arizona Department of Revenue at a 5.6% state rate for most retail activity, plus county and city TPT. Because TPT is the seller's own tax, it's owed even if you never charged customers.

Colorado's state sales tax is 2.9%, administered by the Colorado Department of Revenue, which also collects many county, special-district and statutory-city taxes. But home-rule cities such as Denver can collect their own sales tax separately, so one business can owe several different agencies at once.

Hawaii has no sales tax. It has a general excise tax (GET) on the gross income of businesses — 4% for most retail and service activity, plus a county surcharge — administered by the Hawaii Department of Taxation. Because GET is the business's own tax and covers most services, service businesses often owe it without realizing.

New Mexico has a gross receipts tax (GRT) rather than a sales tax. It's imposed on businesses for the privilege of doing business, administered by the Taxation and Revenue Department (TRD) at a 4.875% state rate plus local increments. Because GRT applies to most services and is the seller's own tax, it's owed even if customers weren't charged.

Alabama's state sales tax is 4%, administered by the Alabama Department of Revenue (ADOR). Many cities and counties add their own sales tax, and some administer it themselves rather than through ADOR, so one seller can owe several agencies. Final ADOR assessments can be appealed to the independent Alabama Tax Tribunal.

Louisiana state sales tax is administered by the Louisiana Department of Revenue (LDR). Local sales taxes are collected separately by parish-level collectors, so a Louisiana seller often owes two or more agencies with different notices and procedures. Disputes with either can go to the Louisiana Board of Tax Appeals.

New Jersey sales and use tax is administered by the Division of Taxation at 6.625%, with no general local sales tax, though qualified Urban Enterprise Zone sellers may charge half the rate. Unpaid balances can be docketed as Certificates of Debt, which act like judgments. Final determinations can be protested to the Division and appealed to the Tax Court of New Jersey.

Georgia's state sales tax is 4%, administered by the Georgia Department of Revenue along with local sales taxes that bring combined rates higher. O.C.G.A. § 48-2-52 makes responsible officers and owners personally liable for sales tax a business collected but didn't remit. Disputes can go to the Georgia Tax Tribunal or superior court.

North Carolina's general state sales tax is 4.75%, administered by the North Carolina Department of Revenue (NCDOR) with county taxes that bring most combined rates to 6.75% or 7%+. G.S. 105-242.2 lets NCDOR hold responsible persons personally liable for unpaid trust-fund taxes, including sales tax. NCDOR offers installment agreements.

Virginia's general sales tax rate is 5.3% — 4.3% state plus 1% local — administered by Virginia Tax, with regional add-ons in areas such as Northern Virginia and Hampton Roads. Virginia Code § 58.1-1813 lets Virginia Tax assess corporate officers and others responsible for collecting sales tax personally. Virginia Tax offers payment plans.

Tennessee has a 7% state sales tax — one of the highest — administered by the Tennessee Department of Revenue, plus local tax of up to 2.75%. With no broad personal income tax, sales tax is the state's main revenue source, and the Department actively collects through liens, levies and closing businesses' sales locations in serious cases.

Massachusetts sales and use tax is 6.25%, administered by the Massachusetts Department of Revenue (DOR), with no general local sales tax, though cities may add a local meals excise. Unpaid tax can affect state licenses and lead to liens and levies. DOR offers payment agreements, and disputes go to DOR and then the Appellate Tax Board.

Maryland's sales and use tax is administered by the Comptroller of Maryland, with no local sales tax. The general rate is 6%, with higher rates on alcohol and certain items. The Comptroller can file liens, levy accounts and block license renewals for unpaid tax. Payment plans are available, and appeals go to the Comptroller's hearing office and then Maryland Tax Court.

Arkansas sales tax is administered by the Arkansas Department of Finance and Administration. The state rate is 6.5%, plus city and county taxes. If a business falls behind, the agency adds penalty and interest and can pursue collection. File missing returns first, then contact the agency about the older balance.

Connecticut sales tax is administered by the Connecticut Department of Revenue Services. The general rate is 6.35%, with no local sales tax. If a business falls behind, the agency adds penalty and interest and can pursue collection. File missing returns first, then contact the agency about the older balance.

District of Columbia sales tax is administered by the DC Office of Tax and Revenue. The general rate is 6%, with higher rates for meals, hotels, parking and on-premises alcohol. If a business falls behind, the agency adds penalty and interest and can pursue collection. File missing returns first, then contact the agency about the older balance.

Idaho sales tax is administered by the Idaho State Tax Commission. The state rate is 6%; some resort cities add local option tax. If a business falls behind, the agency adds penalty and interest and can pursue collection. File missing returns first, then contact the agency about the older balance.

Indiana sales tax is administered by the Indiana Department of Revenue. 7% statewide, with no local sales tax. If a business falls behind, the agency adds penalty and interest and can pursue collection. File missing returns first, then contact the agency about the older balance.

Iowa sales tax is administered by the Iowa Department of Revenue. The state rate is 6%, plus a 1% local option tax in most areas. If a business falls behind, the agency adds penalty and interest and can pursue collection. File missing returns first, then contact the agency about the older balance.

Kansas sales tax is administered by the Kansas Department of Revenue. The state rate is 6.5%, plus city and county taxes. If a business falls behind, the agency adds penalty and interest and can pursue collection. File missing returns first, then contact the agency about the older balance.

Kentucky sales tax is administered by the Kentucky Department of Revenue. 6% statewide, with no local sales tax. If a business falls behind, the agency adds penalty and interest and can pursue collection. File missing returns first, then contact the agency about the older balance.

Maine sales tax is administered by the Maine Revenue Services. The general rate is 5.5%, with higher rates for prepared food and lodging; no local sales tax. If a business falls behind, the agency adds penalty and interest and can pursue collection. File missing returns first, then contact the agency about the older balance.

Minnesota sales tax is administered by the Minnesota Department of Revenue. The state rate is 6.875%, plus local taxes in many areas. If a business falls behind, the agency adds penalty and interest and can pursue collection. File missing returns first, then contact the agency about the older balance.

Mississippi sales tax is administered by the Mississippi Department of Revenue. The general state rate is 7%. If a business falls behind, the agency adds penalty and interest and can pursue collection. File missing returns first, then contact the agency about the older balance.

Missouri sales tax is administered by the Missouri Department of Revenue. The state rate is 4.225%, plus local taxes. If a business falls behind, the agency adds penalty and interest and can pursue collection. File missing returns first, then contact the agency about the older balance.

Nebraska sales tax is administered by the Nebraska Department of Revenue. The state rate is 5.5%, plus local taxes in many cities. If a business falls behind, the agency adds penalty and interest and can pursue collection. File missing returns first, then contact the agency about the older balance.

Nevada sales tax is administered by the Nevada Department of Taxation. The statewide rate is 6.85%, plus county rates. If a business falls behind, the agency adds penalty and interest and can pursue collection. File missing returns first, then contact the agency about the older balance.

North Dakota sales tax is administered by the North Dakota Office of State Tax Commissioner. The state rate is 5%, plus local taxes. If a business falls behind, the agency adds penalty and interest and can pursue collection. File missing returns first, then contact the agency about the older balance.

Oklahoma sales tax is administered by the Oklahoma Tax Commission. The state rate is 4.5%, plus city and county taxes. If a business falls behind, the agency adds penalty and interest and can pursue collection. File missing returns first, then contact the agency about the older balance.

Rhode Island sales tax is administered by the Rhode Island Division of Taxation. 7% statewide, with no general local sales tax. If a business falls behind, the agency adds penalty and interest and can pursue collection. File missing returns first, then contact the agency about the older balance.

South Carolina sales tax is administered by the South Carolina Department of Revenue. The state rate is 6%, plus county local option taxes. If a business falls behind, the agency adds penalty and interest and can pursue collection. File missing returns first, then contact the agency about the older balance.

South Dakota sales tax is administered by the South Dakota Department of Revenue. The state rate is 4.2%, plus municipal taxes. If a business falls behind, the agency adds penalty and interest and can pursue collection. File missing returns first, then contact the agency about the older balance.

Utah sales tax is administered by the Utah State Tax Commission. The state portion is 4.85%, with mandatory and optional local taxes added. If a business falls behind, the agency adds penalty and interest and can pursue collection. File missing returns first, then contact the agency about the older balance.

Vermont sales tax is administered by the Vermont Department of Taxes. The state rate is 6%; some towns add 1%. If a business falls behind, the agency adds penalty and interest and can pursue collection. File missing returns first, then contact the agency about the older balance.

West Virginia sales tax is administered by the West Virginia State Tax Department. The state rate is 6%; many municipalities add up to 1%. If a business falls behind, the agency adds penalty and interest and can pursue collection. File missing returns first, then contact the agency about the older balance.

Wisconsin sales tax is administered by the Wisconsin Department of Revenue. The state rate is 5%, plus a county tax in most counties. If a business falls behind, the agency adds penalty and interest and can pursue collection. File missing returns first, then contact the agency about the older balance.

Wyoming sales tax is administered by the Wyoming Department of Revenue. The state rate is 4%, plus county taxes. If a business falls behind, the agency adds penalty and interest and can pursue collection. File missing returns first, then contact the agency about the older balance.

Alaska has no statewide sales tax, but many boroughs and cities levy their own local sales taxes and collect them directly. Remote sellers report to participating local governments through the Alaska Remote Seller Sales Tax Commission. If you're behind, the creditor is the local government, not a state agency.