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Department of Taxation and Finance Coordinators Training

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1 Department of Taxation and Finance Coordinators Training
New York State Department of Taxation and Finance Coordinators Training

2 Private and Confidential
In accordance with Internal Revenue Service Taxpayers utilizing volunteer program services provide personal information to the volunteers, such as names, addresses, social security numbers, birth dates, and bank account information. Therefore, partners and volunteers must keep the information confidential and protect it from unauthorized individuals and misuse.

3 NYS Tax Contact Information Tax Practitioners Hot Line - (518) Forms Control Unit phone number: (518) TP-3 Forms Order (Can order TP-300 and TP-301) TP -3 If you want to make a change, cross out the amount we have listed and enter the new amount. E-file Helpdesk line – (518) Online Tax Center Assistance (518)

4 NYS Income Tax Information
Personal Income Tax Information 1099-G information Personal income tax refund (518) Disagree with Personal Income Tax Refund Child Support Helpline (noncustodial EITC is denied) Refund Status Apply for Extension Form 1099-G

5 Resources Available for Volunteers
TP-301 NYS Intake Sheet TP-300 Quick Reference Guide DTF-440 (debit card trifold) URL page with training information for volunteers Addendum to the IRS publication 4491-W (comprehensive problems and exercise book) Publication 84- Handbook for e-filers of 2011 PIT Returns. Publication 36 – General information for Senior Citizens and Retired Persons

6 Review of 2010 – Most Common Errors
Amount of NYS withholding reported on return not equal to amount reported on wage and tax statements (129) Amount of public employee 414(h) retirement contribution, subject to NYS tax, reported on return not equal to amount reported on Form(s) W-2. (103) Incomplete or incorrect Student Information on form IT-272. (461) Required information missing for qualifying person reported on Form IT-216. (376) Withholding (NY State, NY City, or Yonkers) should not be greater than or equal to wages. Check your W-2. If not input error, call the Tax Department (518) (502) Routing number is invalid.(904) Invalid value entered.(E2 Main forms) (017)

7 Site Reviews Conducted 96 statewide site review and accuracy rate 97%
Problems were found in the following areas Pensions 529 college savings plans and 1099Qs IT 272, Education credit (new requirements) Invalid EIN# on the 1099UI Federal rejects / State accepts

8 Site Reviews Only about 1/2 of volunteers were familiar with the URL page More sites are using the intake sheet All paper forms that they requested were timely Problems with the ambiguity of the rejection code Problems of submission of state only Problems with the college tuition credit and unemployment insurance Need information on how the set up an IPA when the taxpayer owes NYS. Request more pension information and more IT-214 information for training. Recommend 4491W exercises come out earlier Recommend state tax forms be released earlier. Recommend State change the requirement for submitting amended returns

9 Changes to Personal Income Tax Returns
Form IT Form IT-150, Resident Income Tax Return (short form), has been discontinued Date of Birth - Taxpayers must now enter their date of birth (and their spouse’s date of birth, if applicable) on their primary returns. Yonkers Surcharge - Effective for tax year 2011, the rate of the Yonkers resident income tax surcharge has been increased from 10% to 15% of the net state tax.


11 Changes to Personal Income Tax Refunds
Three options for refund: direct deposit, paper check, or DEBIT CARD DEBIT CARDS –a new way for New York State residents to receive their New York State income state tax refund. DEBIT CARDS benefit taxpayers by reducing the Departments cost that typically associated with issuing paper checks (printing, issuing, and processing).


13 Who would benefit from the Debit Card?
Anyone currently not using the direct deposit method to receive their New York State personal income tax refund; “Unbanked” or “Underbanked” who pay to cash checks; and All taxpayers who enjoy the security and ease of use of debit cards for bill pay and making purchases.

14 Why should a resident select the Card?
It’s secure Cards reported lost/stolen will be replaced quickly. (Refund check replacement can take weeks) Cardholders are protected against all unauthorized transactions. It’s cost-efficient With a capped 1.82% of the face value of the check, costs of cashing a check can become quite high especially as refunds get larger. It’s easier-to-use Use at the point-of-sale with millions of merchants. Use at thousands of ATMs in New York and throughout the country for free or for nominal fees.

15 Lottery Prizes Applied Against Tax Liabilities
A lottery prize in excess of $600 can be applied against a New York State Tax Liability. Only the names of those owing tax liabilities that are warranted, subject to a judgment, or legally fixed, final, and not subject to further administrative or judicial review, will be submitted to the Director of the Lottery.

16 Offer in Compromise Reform
The new Tax Law provisions expand our ability to accept Offers in Compromise to include taxpayers, when payment in full would create undue economic hardship, in addition to those taxpayers who are insolvent or bankrupt. The new program is limited to taxes owed under the Personal Income Tax and business taxes for which a person can be held personally responsible. The Offer in Compromise program allows qualifying, financially distressed taxpayers the opportunity to put overwhelming liabilities behind them by paying a reasonable portion of their tax debt. TSB-M-11(9)C,(9)I,(10)M,(2)MCTMT,(2)R,(14)S- Changes to the Offer in Compromise Program We have expanded our program and hope to encourage voluntary compliance

17 Offer in Compromise Reform
Generally, undue economic hardship occurs when a taxpayer is unable to pay reasonable basic living expenses. Basic living expenses are those that provide for health, welfare, and production of income for taxpayer or the taxpayer’s family. In addition to basic living expenses, we will consider other factors that can impact and individual’s financial condition. Undue economic hardship, does not include the inability to maintain an affluent or luxurious lifestyle.

18 Marriage Equality Act The Marriage Equality Act (Act) took effect on July 24, 2011, and provides that all marriages, whether between same-sex couples or different-sex couples, will be treated equally under the laws of New York.  The Act amends New York law to recognize all legally performed marriages between same-sex and different-sex couples, whether or not the marriage took place in New York. TSB-M11(8)C, (8)I,(7)M,(1)MCTMT,(1)R,(12)S, - The Marriage Equality Act TSB-M-11(8)M – Implementation of the Marriage Equality Act Related to the New York State Estate Tax

19 Marriage Equality Act In accordance with the Marriage Equality Act, you must file your New York return(s) using a married filing status even though your marital status isn't recognized for federal purposes. The Federal Defense of Marriage Act of defined marriage as "a legal union between one man and one woman as husband and wife, and the word 'spouse' refers only to a person of the opposite sex who is a husband or a wife.” Therefore, the IRS does not follow state law for recognizing same-sex marriages and same-sex married couples cannot file their federal return using a married filing status.

20 Marriage Equality Act for Personal Income Taxes
Because the law only applies starting for tax year 2011, you can't amend a prior year returns. To complete your New York Personal Income Tax Return you must: Recompute your federal income tax return (including all credit forms, schedules, and other attachments) using a married filing status. Don't submit this federal married filing status return to the IRS. Use it only to complete your New York return and keep it with your tax documents. You must enter special condition code M3

21 Marriage Equality Act For additional information visit:
The Act applies to all taxes administered by the Tax Department.  As a result, any references in the Tax Law or department documents to: spouse or married individual includes a person in a marriage with a same-sex spouse husband, wife, and spouse should be read as gender neutral to reflect both different-sex and same-sex couples marriage also includes a marriage between same-sex spouses Domestic Partners Cannot File Joint Returns The IRS does not follow state law for recognizing same-sex marriages. The Federal Defense of Marriage Act of 1996 defined marriage as "a legal union between one man and one woman as husband and wife, and the word 'spouse' refers only to a person of the opposite sex who is a husband or a wife." Some states, such as California, are requiring domestic partners to file tax returns as if they were married. For additional information visit:

22 Statute of Limitations to Collect Tax Liabilities
The Tax Law was amended to revise the 20-year statute of limitations on the Tax Department’s time to collect tax liabilities that have been assessed and for which a notice and demand has been issued. This statute of limitations is applicable to all taxes, and any special assessments, fees, interest, additions to tax, penalties, or other impositions administered by the tax department. TSB-M- 11(10)C,(10)I,(11)M,(3)MCTMT,(4)R,(15)S Year Statute of Limitations to Collect Tax Liabilities

23 Statute of Limitations to Collect Tax Liabilities
The tax liability will not be enforceable and will be extinguished after 20 years from the first date a warrant could be filed by the tax department. A payment by the taxpayer or an acknowledgment of an indebtedness in writing by the taxpayer no longer extends the 20-year time limit as under prior law. This new law is effective August 17, 2011 regardless of when the liability was first assessed.

24 Office or Real Property Tax Services Merge with Department of Taxation and Finance
STAR exemption - New $500,000 Income Limit for Basic STAR Property Tax Exemption. Taxpayers can renounce a previously granted exemption. Limits the STAR real property tax growth to 2% annually. Department establishes means to transfers of various real property tax documents electronically.

25 Due Date of the 2011 personal income tax return
April 15, falls on a Sunday Monday April 16th is Emancipation Day in Washington D.C. so the deadline for filing a personal income tax return has been extended.  NYS will conform with the IRS and the personal income tax return will be due April 17, 2012

26 E-file Your Return Most taxpayers who use software to prepare returns must e-file. If their software supports the e-filing of your return, they must e-file. If they are required to e-file but file on paper instead, they may be subject to a $25 penalty. Self-filer mandate was enacted as part of the 2011 legislation. The Self-filer mandate does NOT pertain to returns prepared at a volunteer site either by the volunteer or through Free Assisted Self-Service Preparation (FAST).

27 Volunteers Credits to Prepare
IT-213 – Empire Child Tax Credit IT-214 – Real Property Tax Credit IT-215/IT-209 – Earned income Tax Credits IT-216 – Child Care and Dependent Credit IT-258 – Nursing Home Credit IT-245 – Volunteer Fire Fighter/Ambulance Worker IT-II2R – Resident Tax Credit PLUS – Disability Income Exclusion form IT-221 Pension Exclusion chart to be added to URL page


29 Transmitting New York State return(s)
You must transmit all New York State returns through the IRS Federal/State e-file program. Your state return is usually transmitted with your federal return. You may also transmit your return using the "State only" option if your software supports it. If your return passes the validation and checks, the IRS posts it for our Department to retrieve.

30 Returns Accepted for E-filing
IT-201 IT-213 IT-258 IT-201-ATT IT-213-ATT IT-272 IT-203 IT-214 IT-370 IT-203-ATT IT-215 IT IT-112-C IT-216 IT-112-R IT-245 IT-209 IT-249 See IT-201 Instructions or Publication 84 for a complete list of forms accepted for e-filing

31 Acknowledgements of an E-filed Return
Acceptance by our Department - We will provide acknowledgments for every return that we receive in the correct format. Rejection by our Department - It is the Electronic Return Originators (EROs) responsibility to inform the taxpayers if their return is rejected if the preparer is unable to correct and resubmit. Rejection acknowledgments - A return may have multiple unrelated errors; we provide only one error code at a time. Each rejection will include an error code that identifies the first error encountered that caused the rejection.

32 Timing of Acknowledgements of an E-filed Return
Timing of Acknowledgments During the e-file period: Returns sent to the IRS on Monday through Sunday (except holidays) will be processed on the same day and acknowledgment files will be transmitted. Returns sent to the IRS after 11:00 A.M. and on holidays will be acknowledged the following business day. Contact the E-file helpdesk if you don’t receive an acknowledgment within three business days after the IRS acknowledgment

33 Perfection Period for E-filed Returns
Law enacted in 2010 authorized the Commissioner to establish reasonable correction periods and resubmission procedures for electronic tax filing and payments that were initially rejected after they were timely filed. This applies to electronic returns and payments made for tax years beginning on or after December 31, 2010.

34 USING TAX WISE MUST Enter on NYS Tax Form: School District Name
School District Code County of Resident Line 59 – NYS Sales Tax must have an entry IT214 and NYC-210 are the only forms we accept as stand alone. However, if e-filing must be accompanied by a person income tax return – IT-201 or IT-203.

35 Household Credit (based on Federal AGI)
Tax Credits automatically calculated on New York State software when calculated on IRS return Household Credit (based on Federal AGI) Married $32,000 or less Single $28,000 or less IT Empire Child Tax Credit – From federal child tax credit IT-215 – Earned income tax credit – From federal earned income tax credit IT-216 – Child care and Dependent Credit – From federal 2441

36 Addition adjustment on NYS return
The 414H and amount must be entered on line 14 on the W-2. (taxwise has confirmed that for tax year 2011, “SUB” is not required for an add back on the NYS return). IF NYC IRC 125 must be entered on box 14 of the W-2 Other Addition modifications must be included on proper addition lines of the IT-201

37 Subtraction adjustments on NYS return
Must be entered on appropriate line of NYS return Income tax refund is automatically subtracted Social security income is automatically subtracted Contributions to a NYS 529 College Savings Plan (1099-Q) Pensions - Must indicate on 1099R if the pensions is from NYS and local government of if private pension entitled to exclusion if taxpayer reaches age 59 & ½.

38 E-file Signature Requirements
There is no need to mail Forms W-2 or other supporting documents to the Tax Department when a return is filed electronically. Volunteers are required to have the taxpayer sign the TR-579-IT for each return that is e-filed. The TR-579-IT should be attached to the copy of the taxpayer’s personal income tax return. Volunteers should: enter their SITE ID number where requesting Federal ID number or SS number Name of Site where requesting name of practitioner. If the taxpayer using VITA services uses a self-selected PIN, then there is not need for the tp or the VITA provider to maintain a signature document or mail anything in to NYSDTF. 2. I believe that we have eliminated all of the requirements that restricted the use of a PIN.

39 If Using the Taxwise Software and a Paper Return Must be Filed what you need to know
The NYS forms IT-2, IT-1099-R and IT-1099-UI are for paper filing only; if software is used to prepare the return and the return is NOT E-filed, print IT-2 for all W-2’s. Print IT-1099R if there is NYS withholding tax on the pensions. Print IT-1099 UI if there is withholding on unemployment insurance

40 Payment Options on E-filing
Electronic Funds Transfer (EFT) from a checking or savings account. Credit Card Mail in a check with Form IT-201-V: NYS PERSONAL INCOME TAX PROCESSING CENTER PO BOX 4124 BINGHAMTON NY

41 Estimated taxes You are not required to fill estimated taxes if you expect to owe less than $300 of New York State, city of New York, or city of Yonkers income tax after deducting tax withheld and credits that you are entitled to claim. Payment - April 15, June 15, Sept 15 and Jan 15 NYS does not provide statement of accounts and does not provide vouchers (IT-2105V). The easiest and fastest way for individuals to make estimated tax payments is through our Online Service Center. Individuals can also view and reconcile their estimated tax payments electronically.

42 Online Service Center Press release of October 7:
New York State Tax Department Announces Record Number of Businesses Using Online Services: More than one million Online Service account holders and More than half (519,000) are business accounts. In the past year alone, our online services have reduced our cost and saved taxpayers more than $8 million dollars.

43 Creating an online service account
Create an online account and log in to: Pay estimated income and manage your estimated tax account View and pay tax bills Respond to a notice Report change of address Receive alerts Videos and Demos available

44 Electronic Communication/email
Available to Online Service account holders Sales tax vendors - now Corporations - now Individuals - winter 2011 Filing and payment reminders alerts available General information

45 Modernized E-file with IRS (PIT MEF)
Target Implementation- July 2012 Features: PDF Attachments Multiple Years (Original Returns) January 2013 – TY 2012, TY 2011 January 2014 – TY 2013, TY 2012, TY 2011 Duplicate Returns Accepted Reject if ACH information exactly same

46 Modernized E-file with IRS (PIT MEF)
Standalone Returns- January 2013 IT-214 NYC-210 SSN/Name Validation Amended Returns- January 2014

47 Free e-filing NOTE: Free e-filing available by visiting
Qualifications for free e-filing vary by software providers. Generally, if a taxpayer qualifies for EITC, or under the age of 25, or over 65, or active military or Federal adjusted gross income under $58,000. Check our Website for the software providers that support free e-filing for both the federal (IRS) and NYS personal Income tax return.

48 QUESTIONS? THANK YOU The material included in this slide show is intended only to highlight NYS tax issues as of the date presented. For more comprehensive information, please refer to our TSB-M’s, Forms, Instructions, Bulletins, and Publications.

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