Tax Professional Newsletter 10/06/20
Personal income and New York C corporation October filing deadline
Personal income tax returns for calendar-year taxpayers who requested an automatic six-month extension to file are due on October 15, 2020. This deadline applies to taxpayers who requested an extension for the original April 15, 2020, filing deadline and taxpayers who requested an extension by the revised July 15, 2020, deadline due to COVID-19. With the reported United States Postal Service mail system delivery delays, please encourage your clients who are requesting a personal income tax refund to use direct deposit to receive their refund in the fastest manner.
New York C corporation tax returns for calendar-year filers who requested a six-month extension to file are also due on October 15, 2020.
Reminder to correctly report bond interest
Remind your clients to correctly report bond interest. If your client is a New York State resident who receives federally tax-exempt interest on bonds or bond funds of other states or municipalities outside New York State, your client must report that interest as an addition modification on their New York State tax return.
Please note that bond premium amortization on any bond whose interest income is subject to New York income tax, but exempt from federal income tax, is treated as an addition to New York itemized deductions, not a direct offset to interest income.
2021 tax preparer registration and education
The 2021 tax preparer registration application and continuing education content will be available mid-November. If you're a registered tax preparer, we will notify you through your Individual Online Services account when they become available. To determine if you need to register, visit Tax preparer registration.
Reminder: STAR Check Delivery Schedule
If your clients are wondering when they’ll receive their checks for the STAR credit, you can direct them to the STAR Check Delivery Schedule.
For details about STAR or property tax relief credit checks that were already issued, see Property Tax Credit Lookup.
Register for the Employer Compensation Expense Program
Registration for the Employer Compensation Expense Program (ECEP) employer election is now open.
ECEP established an optional Employer Compensation Expense Tax (ECET) that employers can elect to pay if they have employees that earn over $40,000 annually in wages and compensation in New York State.
- Enrollment for tax year 2021 began on October 1, 2020.
- An employer will make an annual affirmative election to participate in the ECEP no later than December 1 to pay the optional tax in the following calendar year.
For the latest information, sign up to receive email updates for the Employer Compensation Expense Program.
Respond to a Statement of Proposed Audit Change
If your client took certain itemized deductions or subtractions and information available to the Tax Department indicates that they may not qualify, your client will receive a Statement of Proposed Audit Change or a similar document.
Statements the Tax Department is sending this month include these topics:
- College tuition credit. Your client took the college tuition credit or itemized deduction and their scholarships or grants listed in Box 5 of IRS Form 1098-T are greater than the amount listed in Box 1, Payments received for qualified tuition and related expenses.
- No personal income tax return. Your client may receive a letter from us saying we have no record of a New York personal income tax return. To see information we have on the income and tax payments on file, and to respond, please visit Respond to a reminder to file an income tax return. You will need the PIN found in the upper right-hand corner of the letter received. Failure to respond to the reminder to file letter may result in the issuance of a bill for the taxes owed with applicable interest and penalties.
If your client agrees with the bill, there’s no need to file an amended return on their behalf. Simply use the payment coupon included or pay online. If your client disagrees, respond with any applicable documentation by the date indicated on the first page of the bill.
Tobacco products definition of wholesale price revised
The tobacco products definition of wholesale price has been revised. The new definition applies to all tobacco products possessed in this state for sale on or after October 1, 2020. See Cigarette and tobacco products tax.
Rate changes
On September 1, 2020, Onondaga and Sullivan Counties imposed a temporary 4% local sales and use tax on receipts from the retail sale of residential energy sources and services. For more information, see:
- ST-20-1, Onondaga County Local Sales and Use Tax on Residential Energy Sources and Services, and
- ST-20-2, Sullivan County Local Sales and Use Tax on Residential Energy Sources and Services.
Keep up with tax changes
The Tax Professional Newsletter is a monthly summary of recent changes and new information. To receive updates as we announce them, subscribe to new tax topics as we add them to our Subscription Service. We’ll share links to new resources and tax tips as they become available.
Recently added topics include:
- Cigarette, tobacco, and vapor products taxes
- Medical marijuana and opioid excise taxes
- Real estate transfer tax and mortgage recording tax
- Alcoholic beverages tax and beverage container deposits
New York's plastic bag ban is in effect
DEC will begin enforcement of the state’s ban on single-use plastic carryout bags on October 19, 2020.
As of October 19, 2020, any person "required to collect tax" must not distribute any plastic carryout bags to its customers unless such bags are exempt bags as provided for in the Bag Waste Reduction Law.
For assistance with compliance requirements email plasticbags@dec.ny.gov.
Upcoming due dates
10/15/20:
- New York C corporation tax return for calendar-year filers who requested a six-month extension to file
Personal income tax returns for calendar-year taxpayers who requested an automatic six-month extension to file
10/20/20:
Sales tax return for monthly filers
11/2/20:
- Employer's quarterly MCTMT return
- Employer's quarterly combined withholding, wage reporting, and unemployment insurance return
Stay on top of due dates; bookmark our Tax Calendar.
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