Unpaid taxes put your liquor license at risk. The Georgia Department of Revenue can revoke liquor licenses if a business doesn’t pay its state taxes. The good news is that this revocation is not automatic. You have the opportunity to act and protect your alcohol license.
Our tax resolution firm here at Wiggam Law can help you identify your best options based on your circumstances. Since opening our firm, we’ve helped clients save over $2.7 million, preserve their alcohol and professional licenses, and get back on track with their tax compliance goals.
Key Takeaways
- You can lose your GA alcohol license for unpaid taxes, unfiled taxes, local tax delinquency, and state payroll tax issues.
- You will have the opportunity to pay what you owe or submit to a payment agreement before your case progresses.
- A tax resolution firm can help you determine your best course of action based on the specific circumstances and facts surrounding your situation.
- You generally have the opportunity to have your license reinstated once you pay your full tax liability (including any penalties) or agree to a payment plan.
The Link Between Tax Compliance and Alcohol Licensing
There is a direct link between tax compliance and alcohol licensing because the Georgia Department of Revenue oversees both issues. The Georgia DOR is responsible for ensuring all taxpayers remain compliant with the tax code, but they also have an Alcohol and Tobacco Division that’s designed to maximize compliance with state alcohol and tobacco laws.
While the DOR regulates licensing at the state level, each county also has its own licensing requirements and fees. To legally sell or serve alcohol in Georgia, businesses should obtain both a local license and an alcohol license from Georgia’s DOR.
One of the top reasons a Georgia business may face license suspension or revocation is that it failed to file or pay sales tax. The Georgia Department of Revenue is responsible for collecting sales tax and has the legal authority to enforce collection efforts when it doesn’t receive what it’s owed. Since the Department issues alcohol licenses, it has the full authority to suspend or revoke liquor licenses due to tax non-compliance.
On the upside, a recent policy shift in 2016 redirected the GA Department of Revenue from initially seeking compliance through a citation to giving taxpayers an initial opportunity to resolve the compliance issue(s). If you believe you’re falling behind on your tax compliance duties, then the GA DOR should first give you an opportunity to remedy the situation before immediately moving to issue a citation and schedule a hearing.
Common Tax Issues that Trigger License Revocation
The number one thing that could trigger alcohol license revocation is unpaid state sales tax issues. When you owe the GA DOR sales tax debt, your case will be sent over to the agency’s compliance division. They’ll contact you and generally give you up to 10 days to either pay what you owe, negotiate a resolution, or file outstanding returns. If you don’t act, then you’ll face a citation, and a hearing date will be set, which could ultimately lead to your alcohol license being suspended or revoked.
You could also face license revocation when you:
- Fall behind on your local tax obligations
- Don’t pay state payroll taxes
- Fail to file your business tax returns
The Alcohol License Revocation Process in Georgia
As soon as the Department of Revenue becomes aware of your non-compliance, your case will be referred to the DOR’s Compliance Division. They will contact you and will generally provide you with a 10-day grace period to resolve the compliance issues. You can pay your amount in full or submit to a payment plan during this time.
If you do not respond within the 10-day period, then the DOR’s Alcohol and Tobacco Division will issue a citation against your business’s alcohol license. A hearing will be scheduled. You must attend and negotiate a resolution on your hearing date or risk losing your license.
You’ll have the chance to explain the situation and offer a resolution at your hearing. You could potentially demonstrate why you don’t owe what the DOR is claiming you do, or you could provide evidence of recent payments. You could explain the circumstances that prevented you from meeting your obligations. You’ll also have the opportunity to present a payment plan to the DOR. If the DOR agrees, then you might not lose your license.
The DOR will also have the opportunity to present their evidence as to what you owe and why your license should be revoked. The administrative hearing officer will ultimately make a decision in your case with the goal of resolving your tax debt. If you don’t resolve it, then you’ll likely lose your license.
Once your alcohol license has been revoked, it’s a difficult process to get it reinstated. You must generally pay the full outstanding tax liability or submit to a payment plan.
Options for Resolving Tax Problems and Protecting Your License
The best way to protect your license and resolve your tax issues completely is to pay off your entire tax bill in full immediately, but that’s not always possible. Your next best alternative is to agree to a payment plan with the GA DOR.
An Installment Payment Agreement allows you to pay off your tax liability over time in monthly installments. You’ll need to stay on top of your payments, though, because missing even one payment will result in a hearing date. During the hearing, your license could potentially be suspended or revoked.
You may not be eligible to file for a payment plan under certain circumstances. If the business is going through bankruptcy or you haven’t filed your tax returns yet, then you won’t be able to agree to a payment plan. It’s best to contact a tax attorney to determine your options in these situations.
What If You Can’t Afford to Make Payments?
If you can’t afford to pay in full or set up payments, then you risk losing your liquor license. To avoid this, some businesses take out loans or sell assets. Unfortunately, the GA DOR is very unlikely to settle these taxes when a business is still in operation.
The DOR has an offer in compromise program that allows you to settle various state taxes for less than owed, but you’ll only get approved for this type of plan if the DOR genuinely believes you can’t afford to pay off the full balance. And for businesses, that usually means that you’re insolvent or out of business.
However, depending on your unique situation, there may be other options – talk with a Georgia sales tax attorney for help.
Reinstating a Suspended or Revoked Alcohol License
After an alcohol license suspension or revocation, you can have your license reinstated by either paying off what you owe in full or agreeing and adhering to a payment plan. Once you’re on the payment plan and have proven you’re willing to follow it, you can apply for the reinstatement of your license.
First, reestablish your local license. Then, apply for state reinstatement. Do not attempt to sell or serve any alcohol until your license is reinstated.
Why Legal Guidance is Critical During This Process
Legal guidance is paramount if your alcohol license is at risk. For one, you have an extremely narrow window of time to act between when you first receive a notice to comply or receive a citation. This 10-day window is often not enough time to fully research your options, rights, or best course of action without legal assistance.
For another, the consequences of having your alcohol license suspended will be significant. Once your case escalates to that point, your only recourse generally is to pay everything you owe in full or agree to a payment plan.
Finally, if you have a limited license, such as a retail liquor license, you may not be able to get it back if you lose it. If the state only allows certain liquor licenses in that area, someone may jump in and replace you.
That’s why it’s critical to talk with a tax attorney who’s very experienced with state tax laws. You can avoid this scenario with the right legal guidance by resolving the situation before you lose your license.
How Wiggam Law Can Help
The tax resolution team here at Wiggam Law has extensive experience helping clients avoid liquor license revocation and suspension. We know exactly how to leverage our knowledge of the many tax resolution strategies available to businesses to advocate for you.
Before your issue escalates further, schedule a consultation with our tax team. Businesses that are proactive in resolving their issues can usually prevent permanent license loss and often stop a temporary business disruption, too.
Don’t Risk Your Business – Get Tax Help Now
Are you worried that your business could potentially face an alcohol license revocation hearing as a result of your tax problems? If so, then it’s critical to get in touch with a tax attorney about your next moves. The sooner you come up with a strategy to resolve your tax debt, the more likely you are to be able to retain your license and continue to operate your business.
If you’ve already received a DOR notice, then we advise you to act immediately. You generally have a strict 10-day deadline to make your move. Here at Wiggam Law, our team is prepared to strategize with you to ensure the most optimal legal outcome possible in your situation.
Schedule a free consultation with our tax resolution team by using our online scheduler or calling our office at (404) 233-9800 now.
FAQs: Tax Compliance and Alcohol Licensing in Georgia
Do you have more questions about your current tax problems? Do you need help determining if your GA alcohol license is potentially at risk? Consulting directly with a tax resolution attorney will help you secure solid, personalized legal counsel that you can rely on since your lawyer will ask you questions about your specific situation.
Generalized advice may or may not apply to your specific situation. That said, we’ll go over some general answers to some of the most frequently asked questions about tax compliance and alcohol licensing in Georgia below.
Why did the GA DOR revoke my alcohol license?
The GA DOR revokes alcohol licenses for tax delinquency, alcohol beverage code violations, defaulting on a tax payment agreement, or issues regarding the original application.
What happens if I ignore the 10-day window to pay back taxes?
If you ignore the 10-day window, your business will receive a citation, and a hearing will be scheduled. If your back tax situation isn’t resolved at the hearing, your license will be revoked.
Can I get my alcohol license back after it’s revoked?
Yes, you can have your alcohol license reinstated once you pay what you owe or agree to a payment plan.
Can I still operate my business while my alcohol license is suspended?
Maybe, but you are not authorized to sell or serve alcohol. Without a license, doing so is illegal. So, if you run a restaurant, you can continue serving food. If you own a convenience or grocery store, you can continue selling your other products besides wine and beer. But if you own a retail liquor store, you may not be able to operate at all anymore.
Can the DOR revoke other business licenses?
Yes, the DOR can also revoke your sales tax certificate and other licenses granted at the state level.
Sources:
https://law.justia.com/codes/georgia/2018/title-3/chapter-3/article-3/section-3-3-46/
