Certification Regarding Tax Matters
Offerors seeking contracts over $7 million must certify their compliance with federal tax filing, payment, and criminal tax law requirements.
Overview
FAR 52.209-12, Certification Regarding Tax Matters, requires offerors proposing contracts exceeding $7 million to certify their compliance with federal tax obligations. This provision is mandated by appropriations law and aims to ensure that entities seeking large federal contracts are in good standing with the IRS. Offerors must confirm they have filed all required federal tax returns in the past three years, have not been convicted of a criminal tax offense, and do not have unresolved federal tax assessments, except under specific IRS-approved circumstances.
Key Rules
- Applicability Threshold
- Applies to solicitations where the total contract price (including options) exceeds $7 million.
- Certification Requirements
- Offerors must certify they have filed all required federal tax returns for the past three years.
- Offerors must certify they have not been convicted of a criminal offense under the Internal Revenue Code of 1986.
- Offerors must certify they have not been notified of any unpaid federal tax assessment (unless under an approved IRS agreement or active dispute).
Responsibilities
- Contracting Officers: Must include this provision in applicable solicitations and ensure certifications are obtained.
- Contractors/Offerors: Must accurately complete and submit the certification as part of their proposal for contracts over $7 million.
- Agencies: Must enforce compliance and may use the certification to determine contractor responsibility.
Practical Implications
This provision helps prevent awarding large federal contracts to entities with significant unresolved tax issues or criminal tax convictions. Offerors must review their tax compliance status before certifying, as false statements can lead to penalties or disqualification. Contracting officers should verify that certifications are included and complete for all applicable solicitations.