A bond is a guarantee that you will report and pay tax. A bond may be required at any time in an amount sufficient to secure the payment of any tax, penalty, and interest due or which may become due. If you are a new business, please contact our office to determine the type and amount of financial coverage needed to secure your permit.
Compliance bonds may be released when they are determined to be no longer necessary.
Generally, sales and use tax compliance bonds are held for a period of 5 years. However, a taxpayer who accurately and timely files returns and pays taxes for 2 years on their sales and use tax account can request that their account be reviewed for early refund of their bond.
Motor fuel tax compliance bonds are held until the permit is cancelled.
Corporate Officer Bonds
A corporation, limited liability company, or limited liability partnership may elect to post a corporate officer bond to avoid its corporate officers, governors, managers, or general partners from being personally liable for failure to file tax returns or pay the balance owed on a tax account.
A corporate officer, governor, manager, or general partner is relieved from being personally liable for failure to file tax returns or pay the balance owed on a tax account only for tax periods during which the bond is active or until the Declaration of Managers, Members, Governors, Partners, and Corporate Officers is updated.
Please contact our office for options regarding utilizing a Letter of Credit.
There are two different bond categories - cash bond and surety bond.
A cash bond is a compliance or corporate officer bond that is received by our office via payment by cash, check, or money order.
A surety bond is a compliance or corporate officer bond that is received by our office via an insurance company through an insurance policy. The business will pay the dues on the bond insurance premium and our office will receive a form with a raised surety seal confirming the insurance company's obligations.