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

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, , ,53860% 68% Corp Tax Extension Requests 81, , ,98669% 100% PIT Primary2,322,817 7,330,956 9,653,77376% 18% PIT Partnership Returns 108, , ,78367% 79% PIT Extension Requests 200, , ,29371% 76% Sales Tax383, ,492654,36741% 56% 5/26/2011 Slide 2

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

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

 “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

 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

 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

 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

 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, /26/2011 Slide 9

 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

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

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

Filings 5/26/2011 Slide 13 Personal Information

 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 back resolution to taxpayer 5/26/2011 Slide 14

 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

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 Phone: (518)