If your business has been operating in Kansas without properly registering and filing required state taxes, you could be exposed to years of unpaid liabilities. Penalties and interest can compound quickly, and once the Kansas Department of Revenue (KDOR) contacts you, options are limited.
The Kansas Voluntary Disclosure Program (VDP) also known as the Voluntary Disclosure Agreement (VDA), offers a way forward. By voluntarily disclosing your liabilities, you can limit the look-back period, obtain penalty relief, and resolve exposure under predictable terms.
Why the Kansas Voluntary Disclosure Program Matters
Kansas is a centrally located distribution and logistics hub. With growing e-commerce activity, the Kansas Department of Revenue has expanded enforcement, using marketplace facilitator data, IRS reporting, and interstate cooperation to find noncompliant businesses.
If you have nexus in Kansas but haven’t registered, you may owe:
- Sales and Compensating Use Tax – For sales delivered into Kansas.
- Corporate Income Tax – For corporations, S-corps, and LLCs with Kansas-sourced income.
- Withholding Tax – For employers with Kansas-based employees.
The VDP is your chance to come forward voluntarily before KDOR identifies you.
Taxes Covered by the Kansas VDP
The Kansas Voluntary Disclosure Program generally applies to:
- Sales and Compensating Use Tax – Including remote sellers and marketplace facilitators.
- Corporate Income Tax – For businesses deriving income from Kansas.
- Withholding Tax – For employers with Kansas payroll obligations.
- Other Business Taxes – Depending on facts, excise or industry-specific taxes may qualify.
You can disclose multiple tax types together to avoid separate audits.
Kansas Voluntary Disclosure Program at a Glance
| Feature | Kansas VDP |
| Administered by | Kansas Department of Revenue (KDOR) |
| Eligible Taxes | Sales & Use, Corporate Income, Withholding |
| Look-back Period | Typically 3–4 years |
| Penalty Relief | Full waiver of penalties |
| Interest Relief | Rarely waived |
| Anonymity | Allowed through tax representative |
| Deadline After Agreement | 60–90 days to file and pay |
Eligibility Requirements
To qualify for the Kansas VDP, businesses must:
- Not have been contacted by KDOR regarding the liabilities.
- Not already be registered for the tax type being disclosed.
- Voluntarily disclose unreported tax obligations.
- File and pay within the required timeframe.
If you were registered but became noncompliant, you may still negotiate with KDOR, but outside the VDP.
Common Nexus Triggers in Kansas
Economic Nexus – Sales and Use Tax
Kansas enforces economic nexus for remote sellers. Registration is required if you exceed:
- $100,000 in annual gross revenue from sales into Kansas.
Unlike some states, Kansas does not use a transaction threshold, only the revenue threshold applies.
Physical Presence Nexus
You may create nexus if you:
- Own or lease property in Kansas
- Store inventory in a Kansas 3PL or fulfillment center
- Employ staff, contractors, or agents in the state
Corporate Income Tax Nexus
You may owe Kansas income tax if:
- You earn revenue from Kansas-based sales or services
- You employ workers in the state
- You maintain property or offices in Kansas
Benefits of the Kansas Voluntary Disclosure Program
Kansas’s VDP offers several benefits:
- Reduced Look-Back – Generally limited to 3–4 years, compared to 7+ years in audit.
- Penalty Abatement – Waiver of late-file, late-pay, and failure-to-register penalties.
- No Criminal Prosecution – Provided disclosure is voluntary and truthful.
- Anonymity – Applications can be filed anonymously through a representative.
- Predictability – Terms are negotiated and documented, unlike unpredictable audits.
- Compliance Readiness – Resolving liabilities prepares businesses for M&A and due diligence.
Kansas VDP Process: Step-by-Step
| Step | Action | Timeline | Responsible Party |
| 1. Initial Review | Assess nexus and estimate liability | Days 1–5 | Internal / SALT advisor |
| 2. Anonymous Application | Submit through representative | Days 6–10 | SALT counsel |
| 3. KDOR Review | Kansas confirms eligibility, issues agreement | Days 11–25 | Kansas DOR |
| 4. Registration | Obtain Kansas tax ID(s) | Days 26–30 | Company |
| 5. Filing & Payment | File agreed returns, remit tax + interest | Days 31–60 | Company / Commenda |
| 6. Clearance | Receive closure letter | Days 61–90 | Kansas DOR |
Kansas VDP vs. Other States
| State | Sales Tax Look-Back | Income Tax Look-Back | Penalty Relief | Anonymity |
| Kansas | 3–4 years | 3–4 years | Yes | Yes |
| Iowa | 3–4 years | 3–4 years | Yes | Yes |
| Missouri | 3 years | 3 years | Yes | Yes |
| Texas | 4 years | 4 years | Yes | Yes |
Kansas’s program is competitive, particularly given its single $100,000 sales threshold for nexus.
Practical Considerations Before Applying
- Bundle tax types – Disclose sales, income, and withholding at once.
- Prepare records – Collect 3–4 years of transaction, payroll, and property data.
- Seek representation – Anonymity is best maintained through SALT counsel or compliance platforms.
- Use automation – Commenda aggregates Shopify, Amazon, ERP, and payroll data to speed filings.
Long-Term Compliance After VDP
Completing the VDP is only the beginning. To remain compliant:
- Monitor economic nexus thresholds annually.
- Register for new obligations as business expands.
- Implement automated compliance tools for sales and income tax.
- Retain detailed records for at least 7 years.
Decision-Making Framework
The Kansas VDP is a strong option if:
- You’ve exceeded $100,000 in Kansas sales without registering.
- You discovered employees, property, or inventory located in Kansas.
- You’re planning to raise funding or exit, and need to clear legacy tax risks.
- You want predictable resolution instead of risking a lengthy audit.
How Commenda Helps with Kansas Voluntary Disclosure
Commenda is the all-in-one tax and compliance platform trusted by U.S. and global businesses. For Kansas VDAs, Commenda provides:
- Nexus reviews – Assess exposure across all 50 states.
- Anonymous applications – Submit VDPs through legal partners to protect identity.
- Automated data collection – Pull sales, payroll, and property data from e-commerce, ERP, and payroll systems.
- Kansas-compliant returns – File sales, income, and withholding tax accurately.
- Compliance calendar – Track deadlines to prevent missed filings.
With Commenda, businesses can resolve Kansas liabilities in weeks, not months, while building scalable compliance processes for growth.
Book a demo with Commenda today to resolve your Kansas exposure and secure penalty relief.
FAQs on Kansas’s Voluntary Disclosure Program
1. What taxes are covered under Kansas’s VDP?
Sales and use tax, corporate income tax, and withholding tax.
2. How far back does Kansas look?
Typically 3–4 years, versus 7+ in an audit.
3. Can penalties be waived?
Yes, penalties for late filing, late payment, and failure to register are waived.
4. Is interest waived?
No, interest is generally still due on unpaid taxes.
5. Can I apply anonymously?
Yes, through a tax representative until eligibility is confirmed.
6. What if Kansas DOR has already contacted me?
You are no longer eligible for the VDP, but can still negotiate directly.
7. Can out-of-state businesses apply?
Yes, remote sellers and service providers are common applicants.
8. How long does the VDP process take?
Usually 60–90 days from application to clearance.
9. Can multiple liabilities be disclosed at once?
Yes, bundling is encouraged to streamline compliance.
10. How does Kansas compare to other states’ programs?
Kansas’s $100,000-only economic nexus rule and 3–4 year look-back make it attractive.
