1. Helen Pelersi, Director Office of Processing & Taxpayer Services May 26, 2011 5/26/2011 Slide 1

2. Returns Filing with efile Rates Calendar Year 2011 Programs Actual Returns Filing YTD January – April 30, 2011 Paper Volumee-File Volume Total Return Counts e-File % YTD e-File % Change From 2010 Corp Tax Returns191,475 292,063 483,53860% 68% Corp Tax Extension Requests 81,099 180,887 261,98669% 100% PIT Primary2,322,817 7,330,956 9,653,77376% 18% PIT Partnership Returns 108,578 223,205 331,78367% 79% PIT Extension Requests 200,335 492,958 693,29371% 76% Sales Tax383,875 270,492654,36741% 56% 5/26/2011 Slide 2

3. Exceptions and Protest Volume January- April 2011 ExceptionsChg from 2010ProtestChg from 2010 Personal Income Tax 80,399 898+.03% Corporation Tax 46,826 26,747+53% Sales Tax 42,845 39,825 5/26/2011 Slide 3

4. Exception Rate Paper vs E-file January-April 30, 2011 PAPERE-FILE Personal Income Tax1.60%0.67% Corporation Tax14.97%4.80% Sales Tax15.10% 2.01% 5/26/2011 Slide 4

5.  “Opt-out” removed  Legislation effective 1/1/2011  Failing to efile based on the client’s request no longer accepted as “reasonable cause”  No Separate Fee for NYS efiling  Legislation effective 1/1/2011  Software developers/tax practitioners are prohibited from charging a separate fee for filing a return electronically.  Penalties $500 per return-first occurrence $1,000 per return-each subsequent occurrence 5/26/2011 Slide 5

6.  Billing non-compliant tax preparer’s $50 per Corporation Tax return for failure to comply with mandate  Sept 2010 notified over 400 practitioners via “soft” letter and requested copies of “Opt-out” forms  December 2010 began billing non-responsive practitioners  January-March 2011: Continued to bill tax preparers $50 per return for the paper returns that were eligible for efiling 5/26/2011 Slide 6

7.  Corporation Tax Payment Voucher as alternative payment method for efiled Corporation Tax Returns  40% of practitioners surveyed indicated electronically paying was the major obstacle to efiling  January-March 31 st, 2011 Payment Distribution ACH Debit ACH Credit CT Voucher Transactions Dollar Amount ACH Credits 439$305,599,459 ACH Debits 268,126$545,453,191 CT-200-V 61,438$154,491,870 5/26/2011 Slide 7

8.  Mandating Quarterly Sales Tax Vendors to Web-File ( June 2011 )  DTF hosts Website for Sales Tax Filing  ACH Debit payment with option to schedule payments  PIN Letters 5/26/2011 Slide 8

9.  Change in threshold for Preparer Mandate  Effective 2012: 5 or more original software prepared documents in 2011 for mandated taxes  Effective 2007: 100 or more original software prepared documents in 2006  Penalty: $50 per return  Potential Individual Taxpayer Mandate (January 2012-December 2012) $25 penalty for each individual taxpayer who files a paper return using software for an eligible efile return IF NYS fails to achieve 85% PIT E-file penetration rate by August 31, 2011 5/26/2011 Slide 9

10.  Debit Cards for Personal Income Tax Refunds (January 2012)  Bank of America awarded the bid  Currently in contract negotiations  Choices for taxpayer Direct Deposit Debit Card  Eliminate IT-150 (short-form) 5/26/2011 Slide 10

11.  Use of Email  Invitation to taxpayer to communicate with Department via email  Filing reminders, non statutory notices  Recent legislative allowing email for statutory notices (Bills) Starting with Sales Tax Vendors 5/26/2011 Slide 11

12.  Account View  Revamped Website to have a taxpayer “Account View” Message Center Bills 5/26/2011 Slide 12

13. Filings 5/26/2011 Slide 13 Personal Information

14.  Respond to Department Notice (RTDN)  Website to answer questions, attach PDF’s and create narrative to protest a bill, respond to notice asking for additional information, etc Automatically routed to correct work list for resolution Working on System Intelligence to systematically resolve intervention and to email back resolution to taxpayer 5/26/2011 Slide 14

15.  F-SET Adoption for Withholding and Wage Reporting  Analysis phase  Changing PIT Providers 2013  Currently negotiating with 3 rd party processor  In-house Processing for Corporation Tax 2013  Coversheet for paper returns starting January 2012  Due date for IT-204 LLC changed to 60 days from the end of the year to 30 days 5/26/2011 Slide 15

16. 5/26/2011 Slide 16 Helen Pelersi, Director NYS Department of Taxation & Finance Office of Processing & Taxpayer Services Building 8, Room 557 W.A. Harriman Campus Albany NY 12227 Email: Helen_Pelersi@tax.ny.govHelen_Pelersi@tax.ny.gov Phone: (518) 591-1944