627.1. Prerequisites To Filing an Application for Abatement
Two requirements must be met in order for an Application for Abatement to be valid. First, the required return must have been filed for the period stated on the application unless the abatement application is founded on the assertion that no return is required. Second, the application must be received electronically by DOR or postmarked by United States mail within the latest applicable time limit as follows1:
- Within three years from the date the return was filed (or, if the return was filed before the due date, within three years from the due date);
- Within two years from the date the tax was assessed (the date printed on the Notice of Assessment) or deemed to be assessed (See TIR 01-5 and DD 08-1);
- Within one year from the date the tax was paid;
- Within two years of the date of DOR’s determination of a responsible person’s personal liability; or
- Where the taxpayer and the Commissioner have agreed to extend the period for assessment of a tax under G.L. c. 62C, § 27, within such agreed-upon extension of time for assessment of tax (See G.L. c. 62C, § 37, TIR 93-11 and TIR 12-10).
Please note that if a return is not filed and it is later determined that a return was required to be filed for any reason, the abatement and any further appeal may be denied for lack of jurisdiction if it is beyond the latest applicable time period.
- Time limits differ for inheritance tax claims. Call the estate tax information line at (617) 887-MDOR (6367) or, toll-free within Massachusetts, at 1-800-392-6089 for more information.
627.2. Payment of Taxes Due
Tax payments are due when the return is required to be filed, regardless of any extension of time to file. In general, if a taxpayer disputes an assessment (or any portion thereof) by filing an application for abatement, a taxpayer is not obligated to pay the disputed amount while the matter is under consideration administratively within DOR, with the Appellate Tax Board or the Probate Court. Accordingly, involuntary collection activities will be stayed during the dispute period. Late‑pay penalties assessed under G.L. c. 62C, § 33(c) may be waived on audit assessments only during the dispute period. Interest and applicable penalties will continue to accrue on any unpaid amounts, whether disputed or not.
If the taxpayer chooses to dispute an assessment (or any portion thereof) and not pay the disputed amount, the taxpayer retains his or her right to file an abatement claim, provided that the claim is filed within three years of the date the return was filed or within two years of the assessment date. In cases where the three-year and two-year limitations periods have expired and a taxpayer wishes to file an abatement claim, any outstanding liability must be paid before the application for abatement is filed. In such cases, if the full amount of tax liability is not paid, the Commissioner will consider an abatement only up to the amount of the partial payment. See 830 CMR 62C.37.1(4), G.L. c. 62C, § 32(e) and TIR 99-18.
627.3. Timely Applications
An Application for Abatement must be received electronically by DOR or be postmarked by the United States mail within the time limits explained in AP 627.1, above. See G.L. c. 62C, § 33A, as amended.
627.4. Abatement of Interest and Penalties
Interest accrues on any tax that is not paid when due. DOR has no authority to abate interest alone. Interest may be adjusted only in relation to abatement of the underlying tax.
Penalties are imposed for failing to file a return on time or pay a tax when due.
Penalty charges will only be abated if the taxpayer can demonstrate reasonable cause for filing or paying late, or when DOR corrects payments that have been misapplied. See AP 633 for more information on abatement of penalties.
627.5. Separate Applications
A taxpayer should file a separate Application for Abatement of each tax type for each taxable year or period. A taxpayer may not refile an Application for Abatement on the same item of tax for a given tax period unless the claim was previously denied for a failure to substantiate and the claim is sill with the time limits explained in AP 627.1, above. See 830 CMR 62C.37.1(5)(f) for more information.
When a tax is paid more than once a year, e.g., with a monthly sales tax return, the taxpayer may combine all periods for that calendar year in one application. A taxpayer must include with the application a statement of the amount of abatement requested for each period and, if different issues are raised for different periods, specify which issues relate to which periods. Taxpayers required to file Applications for Abatement electronically must individually file an application for each period.
627.6. The Abatement Process; Limitations on the Amount of a Refund Resulting from an Abatement
Applications for Abatement are addressed in the order in which they are received. Factors such as tax type, time of year, documentation provided, and the complexity of the issue can affect the length of time needed to fully research a claim. A taxpayer should never file a duplicate copy of an abatement claim unless the claim was previously denied for a failure to substantiate and the claim is still within the time limits explained in AP 627.1. A taxpayer may check the status of a claim at any time by accessing their MassTaxConnect account or contacting DOR at (617) 887-MDOR or toll-free within Massachusetts at 1 (800) 392-6089.
A taxpayer must include all supporting information, documents, explanations, arguments and authorities that will reasonably enable the Commissioner to determine whether the applicant is entitled to the abatement requested. An abatement application will not be considered complete until all such information has been received by the Department, and the application may be denied by the Department, without prejudice, if the taxpayer fails to provide information requested by the Department within 30 days of the date of the request.
627.7. Withdrawing Consent to Extend DOR's Time for Review Beyond Six Months
Taxpayers who do not cross out the relevant language either online in MTC or in the signature section of Form ABT are consenting to extend DOR's time to review an Application for Abatement beyond six months. If a taxpayer wishes to withdraw this consent after their application has been filed, he or she must request this withdrawal of consent in writing. The application will be deemed to be denied six months after the date the application was filed or on the date of withdrawal, whichever is later. See 627.11 below for information on appealing this deemed denial. If consent to exceed the six month review time is withdrawn, DOR is not required to send notice stating that the claim has been denied. For further information on how to withdraw consent please to go www.mass.gov/dor/amend. See also TIR 16-11.
627.8. Commissioner May Deem an Amended Return to be an Application for Abatement
In certain instances an amended return that shows a reduction of tax may be treated by DOR as an Application for Abatement to protect the abatement and appeal rights of the taxpayer and to allow DOR an adequate opportunity to review the changes. See 830 CMR 62C.26.2 and TIR 16-13. When DOR receives an amended return and deems the amended return to be an abatement application, DOR will provide the taxpayer with notice of such treatment. The notice will provide instructions, including directions regarding hearing rights, and will ask for a response and any necessary documentation. The taxpayer’s amended return showing a reduction of a prior self-assessment will be treated as an application for abatement in the amount indicated and, for the protection of the taxpayer’s rights, the taxpayer will be deemed to have consented to extend DOR’s time to review when the taxpayer filed its amended return. A taxpayer may withdraw such consent at any time by contacting the DOR in writing. See AP 627.7, above.
The self-assessment on the original or a prior return, without adjustment pursuant to this amended return, will remain in effect except to the extent that any amount may thereafter be abated. The date of the filing of the amended return will be treated as the date of filing of the Application for Abatement. The taxpayer will have the option, in responding to the notice from DOR, to request a hearing and/or other dispute resolution options.
In the event that the Commissioner failed to take action upon a properly filed amended return that seeks a reduction in self-assessed tax before the time at which the statute of limitation for abatement claims would otherwise expire, the Commissioner will deem such amended return to be an Application for Abatement in the amount of the reduction sought. To protect the taxpayer’s administrative appeal rights, the taxpayer will be deemed to have consented to extend DOR’s time for review when the taxpayer filed its amended return. A taxpayer may withdraw such consent at any time by contacting the DOR in writing.
627.9. Hearing Requests
Hearing requests or settlement consideration are granted only upon the taxpayer’s requests and if there is a possibility that a claim will be denied in full or in part. A taxpayer will be entitled to an abatement hearing only if it has not already received a pre-assessment conference, or where such a conference has been held, if the taxpayer establishes that there is new factual information or new legal precedent that was not available to the taxpayer at the time of the pre-assessment conference or the taxpayer raises a new issue not considered at the pre-assessment conference. Taxpayers may request a Hearing as described online in MTC or in Form ABT and may be asked to complete additional applicable forms. Generally, the Office of Appeals will consider these requests and will contact the taxpayer. See AP 628: Resolution of Disputes at the Office of Appeals.
If a taxpayer did not request a Hearing on the Application for Abatement, the taxpayer can make this request in MTC or by submitting Form DR-1, Appeals Request. Form DR-1 must be received before any formal determination has been made on the Application for Abatement. See AP 628.
627.10. Notification of Approval or Denial
DOR will notify the taxpayer of its decision of his or her Application for Abatement. Interest on any refund is calculated from the later of the date the return was filed and full payment of tax was made thereon, or the date when the Commissioner received a completed and substantiated written abatement application together with any supplemental information requested by the Commissioner from the taxpayer. Where the Commissioner has denied an abatement application based a failure to substantiate, no interest shall begin to accrue under G.L. c. 62C, § 40 upon any such claim that is appealed to the Appellate Tax Board or to a Probate Court under G.L. c. 62C, § 39 before the date a decision on such claim on the merits is rendered by the Board or Court in favor of the taxpayer.
If DOR approves the claim and determines that a refund is due, a refund will be issued for the correct amount plus any applicable interest, calculated from the date of a fully substantiated application to the date of refund. In general, the refund will be applied to other undisputed liabilities for which the taxpayer is responsible. If an adjustment to an unpaid, undisputed liability is required, DOR will make the adjustment and notify the taxpayer of any remaining balance due.
627.11. Appeals of Abatement Denials
If a taxpayer receives a notice that an abatement claim has been denied in whole or in part, no further review of the claim is available within DOR, except if the claim was denied for a failure to substantiate (see next paragraph). An appeal of DOR’s denial can be filed with the Appellate Tax Board (ATB) within 60 days of the Notice of Denial. This appeal must be received by the ATB, or be postmarked by the United States mail, on or before the 60th day from the Notice of Denial. Taxpayers with a claim that has been deemed denied after choosing not to give consent or withdrawing consent to extend DOR’s time to review beyond six months may appeal the denial to the ATB within six months of the date of deemed denial. See AP 629 for information on filing an appeal with the Board.
DOR may deny an incomplete abatement application if the taxpayer fails to supply information requested by the Department within 30 days. Following a denial of an unsubstantiated abatement application, the taxpayer may file a new, properly substantiated abatement application within the statutory time limitations. In the alternative, the taxpayer may appeal to the Appellate Tax Board or the Probate Court on the merits within the time limitations found at G.L. c. 62C, § 39. Any subsequent Application for Abatement must meet the time limitations for filing for an abatement without regard to the prior filing.
For more information call or write:
P.O. Box 7010
Boston, MA 02204
(617) 887-MDOR or, toll-free within Massachusetts, at 1-800-392-6089