North Carolina General Statutes
Article 9 - General Administration; Penalties and Remedies.
§ 105-237.1 - Compromise of liability.

105-237.1. Compromise of liability.
(a) Authority. - The Secretary may compromise a taxpayer's liability for a tax that is collectible under G.S. 105-241.22 when the Secretary determines that the compromise is in the best interest of the State and makes one or more of the following findings:
(1) There is a reasonable doubt as to the amount of the liability of the taxpayer under the law and the facts.
(2) The taxpayer is insolvent and the Secretary probably could not otherwise collect an amount equal to or in excess of the amount offered in compromise. A taxpayer is considered insolvent only in one of the following circumstances:
a. It is plain and indisputable that the taxpayer is clearly insolvent and will remain so in the reasonable future.
b. The taxpayer has been determined to be insolvent in a judicial proceeding.
(3) Collection of a greater amount than that offered in compromise is improbable, and the funds or a substantial portion of the funds offered in the settlement come from sources from which the Secretary could not otherwise collect.
(4) A federal tax assessment arising out of the same facts has been compromised with the federal government on the same or a similar basis as that proposed to the State and the Secretary could probably not collect an amount equal to or in excess of that offered in compromise.
(5) Collection of a greater amount than that offered in compromise would produce an unjust result under the circumstances.
(6) The taxpayer is a retailer or a person under Article 5 of this Chapter; the assessment is for sales or use tax the retailer failed to collect or the person failed to pay on an item taxable under G.S. 105-164.4(a)(10) through (a)(15), and the retailer or person made a good-faith effort to comply with the sales and use tax laws. This subdivision applies to assessments for any tax due for a reporting period ending prior to July 1, 2020.
(7) The assessment is for sales tax the taxpayer failed to collect or use tax the taxpayer failed to pay as a result of the change in the definition of retailer or the sales tax base expansion to (i) service contracts, (ii) repair, maintenance, and installation services, or (iii) sales transactions for a person in retail trade. The Secretary must determine that the taxpayer made a good-faith effort to comply with the sales and use tax laws. This subdivision applies to assessments for any reporting period beginning March 1, 2016, and ending December 31, 2022.
(8) The assessment is for sales tax the taxpayer failed to collect or use tax the taxpayer failed to pay on repair, maintenance, and installation services provided by a real property manager under a property management contract. The Secretary must determine that the taxpayer made a good-faith effort to comply with the sales and use tax laws. Absent fraud or other egregious activities, a taxpayer that substantiated the time spent managing real property for a billing or invoice period as provided under G.S. 105-164.4K(c) will be determined to have made a good-faith effort to comply with the sales and use tax laws.
(9) The taxpayer is an auctioneer licensed under Chapter 85B of the General Statutes, and the assessment is for sales tax that the taxpayer failed to collect for the sale of livestock at auction. The Secretary must determine that the taxpayer has made a good-faith effort to comply with the tax laws, including being registered as a retailer on or before July 1, 2020. This subdivision applies to assessments for any tax due for a reporting period ending prior to July 1, 2020. This subdivision does not apply if the person received specific written advice from the Secretary for the transactions at issue for the laws in effect for the applicable period or for tax collected and not remitted to the Department.
(b) Written Statement. - When the Secretary compromises a tax liability under this section and the amount of the liability is at least one thousand dollars ($1,000), the Secretary must make a written statement that sets out the amount of the liability, the amount accepted under the compromise, a summary of the facts concerning the liability, and the findings on which the compromise is based. The Secretary must sign the statement and keep a record of the statement. If the compromise settles a dispute that is in litigation, the Secretary must obtain the approval of the Attorney General before accepting the compromise, and the Attorney General must sign the statement describing the compromise. (1957, c. 1340, s. 10; 1959, c. 1259, s. 8; 1973, c. 476, s. 193; 1985, c. 114, s. 11; 1991 (Reg. Sess., 1992), c. 1007, s. 11; 2008-107, s. 28.16(f); 2013-316, s. 9(b); 2015-241, s. 32.18(f); 2016-94, s. 38.5(b); 2018-5, s. 38.10(c); 2019-169, s. 3.9(f); 2019-246, s. 7(a); 2020-6, s. 1(c).)

Structure North Carolina General Statutes

North Carolina General Statutes

Chapter 105 - Taxation

Article 9 - General Administration; Penalties and Remedies.

§ 105-228.90 - Scope and definitions.

§ 105-230 - Charter suspended for failure to report.

§ 105-231 - Recodified as the second paragraph of § 105-230 by S.L1998-212, s29A.14(k).

§ 105-232 - Rights restored; receivership and liquidation.

§ 105-235 - Every day's failure a separate offense.

§ 105-236 - Penalties; situs of violations; penalty disposition.

§ 105-236.1 - Enforcement of revenue laws by revenue law enforcement agents.

§ 105-237 - Waiver; installment payments.

§ 105-237.1 - Compromise of liability.

§ 105-238 - Tax a debt.

§ 105-239.1 - Transferee liability.

§ 105-240 - Tax upon settlement of fiduciary's account.

§ 105-240.1 - Agreements with respect to domicile.

§ 105-241 - Where and how taxes payable; tax period; liens.

§ 105-241.01 - Electronic filing of returns.

§ 105-241.6 - Statute of limitations for refunds.

§ 105-241.7 - Procedure for obtaining a refund.

§ 105-241.8 - Statute of limitations for assessments.

§ 105-241.9 - Procedure for proposing an assessment.

§ 105-241.10 - Limit on refunds and assessments after a federal determination.

§ 105-241.11 - Requesting review of a proposed denial of a refund or a proposed assessment.

§ 105-241.12 - Result when taxpayer does not request a review.

§ 105-241.13 - Action on request for review.

§ 105-241.13A - Taxpayer inaction.

§ 105-241.14 - Final determination after Departmental review.

§ 105-241.15 - Contested case hearing on final determination.

§ 105-241.16 - Judicial review of decision after contested case hearing.

§ 105-241.17 - Civil action challenging statute as unconstitutional.

§ 105-241.18 - Class actions.

§ 105-241.19 - Declaratory judgments, injunctions, and other actions prohibited.

§ 105-241.20 - Delivery of notice to the taxpayer.

§ 105-241.21 - Interest on taxes.

§ 105-241.22 - Collection of tax.

§ 105-241.23 - Jeopardy assessment and collection.

§ 105-242 - Warrants for collection of taxes; garnishment and attachment; certificate or judgment for taxes.

§ 105-242.1 - Procedure for attachment and garnishment.

§ 105-242.2 - Personal liability when certain taxes not paid.

§ 105-243 - Taxes recoverable by action.

§ 105-243.1 - Collection of tax debts.

§ 105-244.1 - Cancellation of certain assessments.

§ 105-244.2 - Expired pursuant to its own terms, effective January 1, 2010.

§ 105-244.3 - Sales tax base expansion protection act.

§ 105-244.4 - Reduction of certain sales tax assessments.

§ 105-244.4A - Grace period from sales and use tax enforcement actions with respect to the sale of certain digital property by certain continuing education and professional development providers.

§ 105-245 - Failure of sheriff to execute order.

§ 105-246 - Actions, when tried.

§ 105-247 - Municipalities not to levy income and inheritance tax.

§ 105-248 - Purpose of State taxes.

§ 105-249.2 - Due date extended and penalties waived for certain military personnel or persons affected by a presidentially declared disaster.

§ 105-250 - Law applicable to foreign corporations.

§ 105-251 - Information required of taxpayer and corrections based on information.

§ 105-251.2 - Compliance informational returns.

§ 105-252 - Returns required.

§ 105-252.1 - Use of a TTIN.

§ 105-253 - Recodified as G.S105-242.2 by Session Laws 2008-134, s10(a), effective July 1, 2008, and applicable to taxes that become collectible on or after that date.

§ 105-254 - Secretary to furnish forms.

§ 105-254.1 - Identification of veterans on income tax form D-400.

§ 105-255 - Secretary of Revenue to keep records.

§ 105-256 - Publications prepared by Secretary of Revenue; report on fraud prevention progress.

§ 105-256.1 - Corporate annual report.

§ 105-257 - Department may charge fee for report or other document.

§ 105-258 - Powers of Secretary of Revenue; who may sign and verify legal documents; who may serve civil papers.

§ 105-258.1 - Taxpayer interviews.

§ 105-258.2 - Taxpayer conversations.

§ 105-258.3 - Power of attorney.

§ 105-259 - Secrecy required of officials; penalty for violation[Effective until January 1, 2023]

§ 105-260 - Evaluation of Department personnel.

§ 105-260.1 - Delegation of authority to hold hearings.

§ 105-261 - Secretary and deputies to administer oaths.

§ 105-262 - Rules.

§ 105-262.1 - Rules to exercise authority under G.S105-130.5A.

§ 105-263 - Timely filing of mailed documents and requests for extensions.

§ 105-264 - Effect of Secretary's interpretation of revenue laws.

§ 105-264.1 - Secretary's interpretation applies to local taxes that are based on State taxes.

§ 105-264.2 - Publication of written determinations.

§ 105-266.2 - Refund of tax paid on substantial income later restored.

§ 105-268 - Reciprocal comity.

§ 105-268.1 - Agreements to coordinate the administration and collection of taxes.

§ 105-268.2 - Expenditures and commitments authorized to effectuate agreements.

§ 105-268.3 - Returns to be filed and taxes paid pursuant to agreements.

§ 105-269 - Extraterritorial authority to enforce payment.

§ 105-269.1 - Local authorities authorized to furnish office space.

§ 105-269.3 - Enforcement of Subchapter V and fuel inspection tax.

§ 105-269.4 - Election to apply income tax refund to following year's tax.

§ 105-269.5 - Contribution of income tax refund to Wildlife Conservation Account.

§ 105-269.7 - Contribution of income tax refund or payment to the North Carolina Education Endowment Fund.

§ 105-269.8 - (Effective for taxable years beginning on or after January 1, 2017 and expiring for taxable years beginning on or after January 1, 2026) Contribution by individual for early detection of breast and cervical cancer.

§ 105-269.13 - Debts not collectible under North Carolina law.

§ 105-269.14 - Payment of use tax with individual income tax.

§ 105-269.15 - Income tax credits of partnerships.