MA DOR Public Hearing September 23, 2014

NOTICE OF PUBLIC HEARING

Pursuant to the provisions of General Laws Chapter 14, Section 6(1), Chapter 30A, Section 2, and Chapter 62C, Section 3, the Commissioner will hold a public hearing on the following proposed regulation amendment and repeals:

830 CMR 62C.19.1:  Extensions of Time for Filing Returns (repeal)
830 CMR 62C.31A.1:  Responsible Persons (amendment)
830 CMR 62C.37A.1:  Settlement of Tax Liabilities (amendment)
830 CMR 65C.1.1:  Administrative Provisions for Estate Tax (repeal)
830 CMR 65C.2.1:  Massachusetts Gross Estate (repeal)
830 CMR 111M.2.1:  Health Insurance Individual Mandate; Personal Income Tax Return Requirements (amendment)

Scheduled Hearing Date:

Tuesday, September 23, 2014 at 10:00 A.M.
100 Cambridge Street, 2nd Floor, Conference Room A
Boston, Massachusetts 02114

Subject Matter:

830 CMR 62C.19.1:  The regulation explains the circumstances under which taxpayers may be granted an extension of time to file income tax, corporate excise and estate tax returns.  The regulation is being repealed because it is outdated and does not reflect current electronic filing methods.

830 CMR 62C.31A.1:  This regulation describes the procedure for the assessment of taxes upon and the collection of taxes from responsible persons, persons under a duty to pay over certain trustee and use taxes owed by a corporation, partnership or limited liability company.  This proposed amendment extends the statute of limitations period for the collection of taxes from six years to ten years, as well as clarifies that any question relative to a responsible person determination before the Department, the Appellate Tax Board, or any court at the end of the collections period will extend the collections period for an additional year after the final determination of the question.

830 CMR 62C.37A.1:  This regulation explains the Department’s procedures for the settlement of tax liabilities authorized under the provisions of M.G.L. c. 62C, § 37A.  This proposed amendment to section (3)(c) requires taxpayers to extend the waiver of the running of the statutory period of limitations on collection of the tax for an additional period ending two years after the due date of the last payment.  This change has been announced previously in DOR forms instructions and administrative procedures.

830 CMR 65C.1.1:  This regulation explains the administrative provisions of the Massachusetts estate tax that were applicable to the estates of decedents dying on or after January 1, 1986 and before January 1, 1997.  The regulation is being repealed because it is obsolete.

830 CMR 65C.2.1:  The regulation explains the property included in the Massachusetts gross estate for the computation of the Massachusetts estate tax that was applicable to the estates of decedents dying on or after January 1, 1986 and before January 1, 1997.  The regulation is being repealed because it is obsolete.

830 CMR 111M.2.1:  Under the Massachusetts Health Care Reform Act, a resident is required to indicate whether he or she has health insurance on his or her Massachusetts personal income tax return.  A resident who has access to affordable coverage but who does not obtain the coverage, and to whom an exception does not apply, is subject to penalties under M.G.L. c. 111M, § 2 which will be imposed through the individual’s personal income tax return.  For tax years beginning on or after January 1, 2014, the federal Affordable Care Act instituted a federal mandate on individuals to obtain and maintain health insurance. While both Massachusetts and federal health care reform include this individual responsibility requirement, there are differences associated with the penalties imposed.  For tax year 2014 and subsequent years, to ensure that no taxpayer is subject to the aggregation of both the state and federal penalties, this proposed regulation provides an adjustment in the circumstance where an individual is subject to both the federal and the Massachusetts penalties.

Information:

Amy Pitter
MA DOR Commissioner of Revenue

A copy of the proposed regulation will be sent electronically via e-mail to practitioners who are on the Rulings and Regulations Bureau's e-mail list.  In addition the proposed regulation is posted on the Department of Revenue's Web site at: http://www.dor.state.ma.us/rul_reg.  Hard copies of the proposed regulation may be obtained from the Rulings and Regulations Bureau, Post Office Box 9566, Boston, Massachusetts 02114-9566.  Written comments in advance of the hearing are encouraged and should be sent to the Rulings and Regulations Bureau.  Alternatively, comments may be emailed to RulesandRegs@dor.state.ma.us or faxed to 617-626-3290.  All persons desiring to be heard on this matter should appear at the designated time and place.

Rhode Island Business Coalition Commends Recent Business Climate Reforms

The Rhode Island Business Coalition released a report commending the General Assembly for passing business friendly legislation in the 2014 session, including reducing the corporate tax rate, switching to combined reporting, and removing the estate tax "cliff," and encouraged further reforms to address the state's deficit.

Below is the PDF

RI Business Coalition Report

Massachusetts DOR Explains Limited Amnesty Program

What You Need to Know About the Tax Amnesty Program

A provision in the FY15 Massachusetts state budget establishes a tax amnesty program for two consecutive months during the 2015 fiscal year for certain tax types.

Only individual and business taxpayers who receive a Tax Amnesty Notice from the Massachusetts Department of Revenue (DOR) will be eligible for the amnesty program, which applies to certain existing individual and business tax liabilities that were stated on a Notice of Assessment issued by the Commissioner on or before July 1, 2014.

The amnesty program will run from September 1, 2014 to October 31, 2014 but will not extend to individuals and businesses that have already paid all tax and interest amounts due and only owe penalties, those that have signed settlement agreements with the Commissioner, or those who are determined to have been the subject of tax-related criminal investigations or prosecutions prior to or during the amnesty program. Also, any taxpayer that delivers or discloses or has delivered or disclosed any false or fraudulent application, document, return or other statement in connection with the amnesty program will not be eligible for amnesty and will be subject to the greater of: (i) applicable penalties under G.L. c. 62C; or (ii) a penalty not to exceed $10,000.

If you qualify for this tax amnesty and pay your taxes and interest in full, the Department will waive all associated penalties. showing the tax and interest due, along with the penalties to be waived, will be mailed on September 2, 2014 to taxpayers who qualify. If you pay the tax and interest shown on the bill on or before October 31, 2014, the Commonwealth will waive the unpaid penalties for the period.

More details on the MA DOR Amnesty program can be found online here

Upcoming Rhode Island Small Business Seminars and Trainings

These seminar and training sessions offered through the RI Division of the US Small Business Administration may be of interest to you and/or your clients. Our Chapter is in no way affiliated with any of these offerings.

Thursday, September 4

Export Express Grant Program (U.S. Small Business Administration and Commerce RI – 315 Iron Horse Way in Providence from 8:30-10:30am and is free of charge.  To register, please email providence.ri@sba.gov or call 401-528-4561):

The Export Express Grant program provides funding to Rhode Island companies for customized export training programs, including business plan development, market entry strategies, export logistics, international trade show development, certification training and foreign language training.  Eligible Rhode Island companies may apply for up to $5,000 in matching funds to address their international training needs. Consortiums may receive additional funding.

The International Trade Office will work with businesses to develop customized training to fit their export needs. Companies may implement training in the following areas: International Business Plan Development; Market Entry Strategies; Export Logistics; International Business Development Mission/ Trade Show Development; Language Training.



Financing Strategies:  Learn from the Experts (Center for Women & Enterprise – 132 George M. Cohan Boulevard in Providence from 4:00 – 6:00pm.  Fee for workshop is $50.  Partial scholarships may be available to those who qualify.  To register, visit www.cweonline.org or call 401-277-0800):

If you are in the process of launching a new business, or thinking about starting one, this panel discussion will help you to understand the variety of financing options available to you as a new business owner.  The discussion will focus on strategies to raise funds as well as what investors and lenders look for when making financing Decemberisions.  The panel can have but not limited to the following experts:

• Angel investor
• A micro-credit lender
• A banker
• A crowd-funding expert
• An entrepreneur with experience raising funds

We will begin with a brief introduction and overview of services from each panelist followed by a panel discussion and Q &A with audience.



Legal Considerations for New Business Owners (Center for Women & Enterprise – 132 George M. Cohan Boulevard in Providence from 6:00 – 8:00pm.  Fee for workshop is $50.  Partial scholarships may be available to those who qualify.  To register, visit www.cweonline.org or call 401-277-0800):

This workshop provides a high level overview of a range of legal issues that entrepreneurs should be aware of when starting their company.  Attend this workshop to learn how to avoid common mistakes and employ preventative measures that can protect and ensure the success of, your new business.

Workshop topics will include:

Entity formation
• Contract Basics
• IP Considerations
• Licenses and regulations

After the workshop, participants will have the opportunity to sign up for a one on one consultation regarding their specific business legal concerns through the Center for Women and Enterprise’s one on one consulting program.


Friday, September 5

Is Entrepreneurship Right for You? (Center for Women & Enterprise – 132 George M. Cohan Boulevard in Providence from 6:00 – 8:00pm and is free of charge.  To register, visit www.cweonline.org or call 401-277-0800):

Attend this workshop and Decemberide whether starting your own business is right for you.  As part of this workshop, you will:

• Explore the process and learn about the risks and rewards of starting up your own business
• Conduct a self-assessment that will help you Decemberide if business ownership is right for you
• Hear success stories of women who have worked with CWE and are now thriving in the business world
• Get an overview of various resources at CWE and elsewhere to help you move forward with your business idea and succeed
• Have the opportunity to schedule an individualized consultation with a CWE Program Manager

RI Tax Preparers to Face New Compliance

The Rhode Island Division of Taxation has proposed a regulation involving penalties that may be imposed on paid tax preparers who fail to comply with due diligence requirements.

Regulation PIT 14-23 would help to implement a state law enacted in June 2013 that established specific penalties -- civil and criminal -- for paid preparers who prepare Rhode Island returns with the intent to wrongfully evade or reduce a tax obligation. (See Rhode Island General Laws Chapter 44-68.)

A public hearing on the regulation is scheduled for 9:30 a.m. on Wednesday, September 17, 2014, at the Rhode Island Division of Taxation, One Capitol Hill, Providence, R.I.

Also at that hearing, the Division of Taxation will take public comment regarding two regulations that are scheduled for repeal because the underlying statutes have been repealed: Regulation CT 88-09, “Business Corporation Tax/Net Worth Tax,” and a regulation which was related to the study of combined reporting, Regulation CT 11-15, “Combined Reporting (pro forma).”

Highlights From NATP Annual Conference

Chris Miarecki

Compliments of Christine Miarecki, Immediate Past President of the Chapter, here are some highlights from the NATP Annual Conference held in Orlando last week.

There were 7 members from the Board of Directors there on Sunday to attend the Leadership Sessions held prior to the opening of the conference.

One of the most interesting sessions informed us that the IRS has formed a new division which is now auditing the groups who offer education. The National Office has already been audited and it appears the state chapters will also be audited over the next 2-3 years. The scope of what they are looking for is that procedures are in place and being followed regarding attendance, speaker qualifications, etc.

Since our programs must be approved by the IRS we know our speakers are highly qualified and we are following the requirements for attendance. We need your cooperation to make our programs run smoothly. We must have your PTIN and you must sign in for the sessions in order to receive your credits. These are the regulations which the IRS has put in place so please understand that we need to follow these rules or run the risk of losing our ability to offer education seminars. Thank you for your understanding and cooperation.

As usual all of the classes that were offered for the week were excellent , great instructors who are so knowledgeable and so willing to answer questions. It is so difficult to chose what sessions to attend but somehow every day was filled and by Thursday afternoon my head was a jumble of information to be sorted out slowly.

I highly recommend attending the National Conference, it is a wonderful opportunity for education and more importantly meeting fellow preparers from all over the country. It is also good to hear that your problem clients are not unique and it helps to hear how others handle those situations that cross our desks daily.

Another issue that ran throughout the whole conference was office security and keeping your clients information protected. This is an area that the IRS is also looking at, making sure preparers are following the regulations to protect their clients.

Well those are some of the highlights, hope to see you in October at our Annual Chapter Meeting and Education Session in Mansfield.

I am happy to answer any questions or hear your ideas for our Chapter, National Conference or general information.

2015 National Conference will be held in New Orleans, please give some thought to attending you will not be sorry. This was my 10th conference, first was Boston and I was hooked.

Enjoy some photos!

Orlando Marriott Resort - View From Room Balcony

Orlando Marriott Resort - Storm Rolling In

"Reaching Your Summit" Leadership Session

"Reaching Your Summit" Leadership Session

Massachusetts Lawmakers Approve Angel Investor Tax Credit

The Massachusetts legislature on August 1 approved an omnibus economic development bill that would create an angel investor tax credit as a way to encourage investment in small businesses.

The conference report of H 4377  also would restructure the state's research and development credit, create a tax credit for pre-Broadway shows, and establish a two-day sales tax holiday.

The Democrat-controlled legislature approved H 4377 as one of its final acts of this year's formal legislative session: The House enactment vote was 144 to 9; the Senate's was 40 to 0. The bill now goes to Gov. Deval Patrick (D), who has previously indicated his support for specific provisions of the bill.

In a statement issued August 1, House Speaker Robert DeLeo (D) said the bill ensures that residents, businesses, and communities "are able to compete and excel in a dynamic, global economy. I'm particularly proud and encouraged by the initiatives that will broaden the circle of economic prosperity beyond Greater Boston to all regions of the Commonwealth."

Senate President Therese Murray (D) said in the statement, "This bill makes many investments in our

MA DOR kicks off Small Business Initiative with Practitioners

Practitioners work with small businesses every day and many run their own small businesses.  So, they were the perfect group to start with to gather information.  We kicked off the 2014 Small Business Initiative with a statewide tour to meet with members of the Mass Society of CPAs and then launched an online crowdsourcing challenge with practitioners across the state.  DOR is reviewing the material collected during the tour and challenge and taking actions based on the feedback. Practitioners gave us great information to help launch the initiative and engage small business owners in conversation about their needs.
 

What We Learned

DOR took the information learned from practitioners during the statewide tour and through the crowdsourcing challenge and plans to ask small businesses to expand upon the information so DOR ends up with a well-rounded understanding of their needs. Here are some of the comments DOR received from practitioners:

New Business Clients:

Practitioners wanted to know if there was a way the agency could be alerted when a small business is formed so that it can increase education and outreach efforts. Practitioners would like DOR to provide informational emails for new business clients.  They also suggested a new business webpage explaining tax obligations. DOR is looking at each of these suggestions and will follow up with ideas.

Rulings & Regulations:

Participants suggested that when an email communication on a tax matter is sent out, a basic description of what it is, how it affects taxpayers and forms involved should be included.  Many practitioners said having examples were very helpful. DOR recently changed the format for email communications to provide a quick summary of the highlights of the information to make it easier for readers to determine the significance to them.  Whenever possible, more examples will be included.  

Notices:

Practitioners have asked that DOR clarify what actions taxpayers should take upon receiving a notice, including how to make a payment. They also requested that notices include an obvious indication of what year it relates to.  It was suggested that notices be available electronically and/or emailed to taxpayers and practitioners. DOR is in the process or reviewing all notices that are sent out and making revisions to keep taxpayers better informed of the reason for the notice and the actions they need to take.    There will be a great number of options available within the new tax system that is currently being developed.  

Website:

Practitioners would like the Guide to Sales Tax to be available in PDF form. They also suggested that DOR send out information about the most popular topics or a ‘tip of the week’ including links with more information on the subject. DOR is currently working to make website navigation quick and easy. Currently the Taxpayer Advocate posts TIPS on the website.

Efiling:

Practitioners also suggested DOR send an email notice to a taxpayer prior to money being withdrawn from an account for a scheduled tax payment if possible. DOR is looking into its efiling system capabilities based on these suggestions.

Customer Service:

Practitioners suggested that customer service hours are staggered during tax season to help with the number of calls. Both extended hours and a practitioner hot-line are under discussion in conjunction with the phased-in implementation of our new IT system.  

Collections:

Practitioners encouraged DOR to review its collections processes in an effort to maximize revenue collections while still ensuring fair practices. Practitioners also believe taxpayers need to further understand their options and the process involved for claiming hardship. DOR is working on new content for the “How Do Collections Work” webpage to explain the collections process and help taxpayers better understand their options if they cannot pay a bill.

Audit:

Practitioners believe having desk auditors available in district offices where practitioners and their clients could stop by with records for review would be beneficial. DOR is examining the feasibility of scheduled visits by auditors to district offices.

Abatements:

Practitioners were asked if they or their clients have utilized the online CA6 or amend a return/abatement option.  Practitioners suggested that confirmations be issued or that checking the status of an application online be considered.  Additionally, they would like to know the reason an application is denied. DOR plans to look into ways to enhance the online abatement process to makes it even easier for taxpayers and practitioners to use. The agency is also discussing ways to let taxpayers and practitioners know the specific items in the abatement that have been denied before a case hearing is scheduled.

Surveys:

Practitioners asked about DOR surveys.  Some had a concern about their comments going directly to auditors.  DOR surveys are an important resource for practitioners and small business owners to speak directly to DOR.  The Taxpayer Advocate reviews all responses and reports directly to the Commissioner on the issues and concerns. Responses to surveys taken from the website survey page

1099 Withholding:

Practitioners asked for a solution to requests for copies of 1099s every year in order to credit money from the same taxpayer. DOR is looking into other ways to verify information for consecutive years.

Power of Attorney:

Practitioners with Power of Attorney for their clients would like to receive copies of all notices sent to clients. While not possible in the current tax system, this will be a goal for the future.

McKinney Walker Plan - Putting Connecticut Taxpayers First Eliminates Income Tax for Middle Income Workers

Recently, our neighboring state of Connecticut gubernatorial candidate John McKinney (R) released his proposed fiscal plan to balance the fiscal 2016 budget, reduce spending by $1.4 billion, phase out the 10 percent business surcharge tax, and eliminate the income tax for filers under $75,000 in fiscal 2017.

Candidate for Governor, Senator John McKinney and Lt. Governor Candidate, Former U.S. Comptroller General Dave Walker unveiled their plan to put Connecticut taxpayers first.

“When elected, we will introduce a budget plan that balances without new taxes or borrowing by making real spending reductions,” said Senator McKinney. “We believe that Connecticut taxpayers deserve a better deal.”

The McKinney-Walker proposed plan will:

• Reduce the FY2016 budget with $1.4 billion in spending reductions and nonew taxes or new borrowing.
• Balance the FY2016 budget to guarantee the clothing and footwear sales tax exemption and the phase-out of the 10% business surcharge tax.
• Eliminate the income tax for filers under $75,000 in FY2017.

Governor Malloy added $3 billion in new state spending, raided trust funds, increased borrowing, and imposed the single biggest tax hike in Connecticut history.

“He has no more tricks up his sleeve. With a stagnant economy and a sweetheart deal with union bosses, he simply can’t solve the problem,” said Dave Walker. Sen. McKinney remarked - Tom Foley claims he can solve the problem by flatfunding and dodges questions about how this would work by saying he “just
won’t let anything go up.”

John McKinney (L) & David Walker (R)

“His approach doesn’t even exist in reality. Tom’s either hiding some plan or doesn’t understand the budget. Either way - his approach lacks the candor and honesty that are needed to solve the problem. Connecticut residents are anxious about the future and want major change,” added Sen. McKinney.

The McKinney Walker Team, believe in addition to giving Connecticut taxpayers a better deal, the state’s business and industry leaders deserve a stable fiscal and economic environment. Walker said, “When the state’s fiscal house is in order businesses will have stability and taxpayers will have relief.”

“We believe that state government has an obligation to provide both,” added Sen. McKinney.

To read more about the plan please visit www.McKinneyforGovernor.com

Massachusetts DOR: Tax Amnesty Set for September, October 2014

The Massachusetts Department of Revenue has provided information about a tax amnesty program established in the state's fiscal 2015 budget (H 4242); the amnesty is set for September and October and notices will be mailed on September 2 to qualifying taxpayers.

What You Need to Know About the Tax Amnesty Program

A provision in the FY15 Massachusetts state budget establishes tax amnesty program for two consecutive months during the 2015 fiscal year for certain tax types.

What is this tax amnesty program?

When you don't pay your taxes in full when they are due, interest and a variety of penalties continue to be assessed until payment in full is received by the DOR. If you qualify for this tax amnesty and pay your taxes and interest in full, the Department will waive all associated penalties.

What are the dates for the tax amnesty program?

The tax amnesty will take place during the months of September and October, 2014.

How do I participate?

Tax amnesty notices showing the tax and interest due, along with the penalties to be waived, will be mailed on September 2, 2014 to taxpayers who qualify. If you pay the tax and interest shown on the bill on or before October 31, 2014, the Commonwealth will waive the unpaid penalties for the period. Please note that the amnesty only applies to assessments that were on the books prior to July 1, 2014.

What types of taxes are eligible?

The tax types that are eligible for this amnesty program include:

• Boat and recreational vehicle sales tax
• Cigarette, cigar and smoking tobacco excise
• Convention Center Financing Fees (CCF) on rooms, parking and tours (applicable locations)
• Club alcoholic beverage excise
• Gasoline excise
• Individual income tax
• Materialman sales tax
• Meals tax, including local option
• Room occupancy excise, including local option
• Sales and use tax
• Special fuels excise