New law empowers state efforts to collect back taxes

JEFFERSON CITY, Mo. -- Backed by a law passed last year, state officials have threatened thousands of professionals and state workers with the loss of their livelihood if they don't make good on their back taxes, collecting millions of dollars in the process.

Under the law, officials can strip a professional license for failure to pay taxes, as well as take away the job of a state employee who fails to pay.

"We really are pretty lax on our collections and didn't have a whole lot of ability [to enforce collection]," Rep. Shannon Cooper, who sponsored the legislation, said Wednesday. "This had made a difference. It's their livelihood, they're going to pay or not be able to work."

Cooper, R-Clinton, said there have been some minor problems, especially with initial notices going out to people who don't actually owe taxes, but in general the law is accomplishing its goal. Department of Revenue spokeswoman Jessica Robinson said the agency has collected nearly $5.6 million in taxes owed since the law took effect.

Screening license-holders

The department said that as of this week, it has screened 156,470 professional licensees -- both current license holders and new applicants -- for taxes owed. The department checks current license holders as their licenses come up for renewal, and it will be another year before all of those have been checked.

But already, the department has flagged 46,663 people as having not paid their taxes properly. Notices were sent to those people, who have 90 days to respond and pay the taxes or explain why they don't have to. Many of those are resolved once the person gets the letter, if they owed no Missouri taxes in that time period, for example.

After weeding out those who were wrongly notified or made payments when informed, the department has sent notice to various licensing agencies for 5,561 people whose licenses should be suspended or revoked.

The roughly 65,000 state employees are checked every year. A year ago, 9,700 employees received notice that they hadn't paid their taxes. About 2,300 names were eventually sent on to state agencies to deal with those who still hadn't paid or straightened out the matter. This year, nearly 4,900 employees have received the initial notice from revenue officials.

The department does not track what happens once it sends the names to agencies, but employees or licensees generally have one last chance to pay up before losing their job or license.

Lawyers are checked separately. Of about 24,700 lawyers checked, 7,215 got a notice, but many of those are lawyers who don't practice in the state. In the end, 613 hadn't paid up and faced losing their license, the department said.

Estimates of the fiscal impact from the professional license limits in 2003 were that the state could collect between $10 million and $20 million once everyone had been checked. Robinson said the agency's collections are on track at this point.

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On the Net:

Missouri Legislature: http://www.moga.mo.gov

Revenue Department: http://www.dor.mo.gov