Friday, December 9, 2005
Tim Connolly
(617) 626-2369

Revenue Commissioner Alan LeBovidge announced today that any taxpayer who has received a preliminary tax bill for 2002 capital gains should disregard the notice.

The DOR has mailed checks to more than 500 taxpayers who already paid a collective $3 million. Another 500 taxpayers, who sent payments that were not processed by the Revenue Department, will have their voided checks returned.

The notices were mailed last month in response to the state Supreme Judicial Court's Peterson decision which changed the effective date of the increase in the long-term capital gains tax to January 1, 2002. About 21,000 of the 48,000 preliminary bills had been mailed when the Legislature voted to change the effective date of the increase to January 1, 2003.

Governor Mitt Romney signed the bill changing the law yesterday. The new effective date means that 157,000 taxpayers who realized capital gains in the last eight months of 2002 now qualify for a refund.

"I feel like I went from the Grinch that stole Christmas to Santa Claus," LeBovidge said. "On Monday we will be ready to start processing abatements to get the refund checks to taxpayers."

Any taxpayer who paid the 5.3 percent rate on a capital gain in 2002 is eligible for an abatement. The taxpayer should collect their financial records from 2002 and then go to the DOR website, www.mass.gov/dor to get the forms and guidance that will allow them to file for an abatement.

DOR will develop over the next several weeks a separate online abatement application to help simplify Peterson related refund requests and speed their processing.