Wednesday, January 18, 2017

Rhode Island Info on Upcoming Filing Season

The Rhode Island Division of Taxation today posted a special edition of its newsletter, which focuses on the forthcoming filing season. Among the topics:

  • The new tax break for Social Security benefits.
  • Measures to combat tax refund fraud.
  • An increase in the earned income credit.
  • An increase in the property-tax relief credit.
  • The April 18 filing deadline for personal returns.
  • New deadlines for business entities.
  • A reduction in the corporate minimum tax.
  • A reduction in the filing charge for pass-through entities.
  • The annual sales tax reconciliation.

To view a copy, please use the following link:

Tuesday, January 17, 2017

Chapter Volunteers

YOUR Chapter needs YOUR help!!! This is YOUR Chapter and we could use your help. Are you willing to serve on any of the following Committees?

Education Committee
Newsletter Committee
Nominating Committee
Financial Review Committee
Gov’t Relations Committee
By Laws Committee
Welcoming/Membership Committee

If you excel in any of these areas or just want to try something new, please contact Chapter Secretary Jeffrey Schweitzer at 781-440-6655 or

IRS Reminds Tax Professionals To Revalidate Identity For IRS E-Services

The IRS has issued a reminder to tax professionals to recipients of Letter 5903 that time is running out to revalidate your identity in order to continue accessing your IRS e-Services account.

If you received a Letter 5903 from the IRS you MUST revalidate to access your account. Failure to take any action will result in the suspension of your e-Services Registration Account.

You may revalidate your account either online or by telephone. To validate online, you will use Get Transcript Online's Secure Access authentication process. Select "first-time user" and complete the authentication process. To validate by telephone, call the e-Services Help Desk and provide the Unique Security Code from your letter 5903. The IRS has additional personnel staffing the Help Desk. That number is: 866-255-0654.

Help Desk Hours: The e-help Desk will provide extended hours of service only for e-Services users who have received Letter 5903, asking them to validate their identities. Extended hours for the e-Help Desk are:

  • Monday thru Friday: 6:30 a.m.- 8:00 p.m. Central Time
  • Saturday: 9:00 a.m.- 3:00 p.m. Central Time 
  • Jan. 16, 2017 Martin Luther King Holiday 9:00am -3:00 p.m. Central Time.

Monday, January 16, 2017

IRS Verification Code to Appear on 47.8 Million Forms W-2

About 20 percent of Forms W-2, Wage and Tax Statement issued for tax year 2016 will include a
verification code used in a pilot program to fight tax fraud and identity theft, IRS officials have announced.

The code will appear on nearly 47.8 million Forms W-2 for tax year 2016, up from 1.7 million for tax year 2015, according to Scott Mezistrano, representative for industry stakeholder engagement and outreach.  The program uses a 16-character alphanumeric code to verify W-2 data on Form 1040, U.S. Individual Income Tax Return. The code will appear on copies B and C of affected forms, he said. Payroll service providers Automatic Data Processing LLC, Ceridian LLC, Intuit Inc., Paychex Inc., Payroll People Inc., PrimePay Inc. and Ultimate Software Group Inc. are among those participating in the pilot, he said.

The code should be entered on the 1040 when using tax-preparation software, so be looking for it.

Saturday, January 14, 2017

Massachusetts Fails to Adopt New Federal Filing Deadline For Corporations

Corporate taxpayers in Massachusetts will have to deal with different state and federal filing deadlines after a bill to align the two failed to pass in the Massachusetts Legislature.

The new federal filing deadlines are March 15 for partnerships and S corporations, and April 15 for individual and C corporation returns.  When the federal government announced in 2015 that it would change to these new filing deadlines, most states quickly adjusted their deadlines to match them, but Massachusetts and a handful of other states did not do so.  Massachusetts corporate interests backed a bill to require the state to align its deadlines with the feds, but lawmakers failed to take up the bill Jan. 3, the final day of the legislative session.

That means corporate filers in Massachusetts will have to comply with two deadlines when filing their 2016 taxes. Massachusetts requires S corporations and C corporations to file on March 15, which will force some companies to use estimated figures and then amend their returns after they receive actual figures, according to tax professionals.  As a result, they expect many companies to seek filing extensions.


Friday, January 13, 2017

Per Diem Deduction for Day Care Meals for 2016

Day care providers can deduct the meals they provided to the people being cared for.  These meals can be based on actual costs or a per diem amount.  The per diem amounts for accounting for meal expenses for day care providers are based on the CACFP reimbursement rate.  The rates for 2016 tax deduction purposes are based on the CACFP rates effective July 1, 2015.  Here is a reminder of some of the details along with the 2016 rates.

General – If the provider is receiving a reimbursement under the CACFP (Child and Adult Care Food Program of the Dept of Agriculture) or any other program, the amount allowed as a deduction is the per diem rate less the reimbursement.  A family day care provider can use these rates for up to one breakfast, one lunch, one dinner, and three snacks per eligible child per day.

Rates – The rates are equal to the Tier 1 reimbursement rates of the CACFP for meals served in day care homes.  They will be adjusted each year and can be found at under “Child and Adult Food Care Program” and clicking on Reimbursement Rates.    

Included – These rates include beverages, but not non-food supplies such as containers, paper products, or utensils.

Consistency – The provider can choose to use either the actual expenses or the per diem method, but must use the chosen method for the entire tax year.  Each year is a separate choice.

Record Keeping – The provider must keep records to substantiate their computation of the meals provided.  These records should show the name of the applicable child, the dates and hours of attendance in the provider’s day care, and the type and quantity of meals and snacks served.  Revenue Procedure 2003-22 has a sample log which can be used for this purpose.

The amounts allowed for 2016 are:

- Other than Alaska or Hawaii
- - Breakfast - $1.32
- - Lunch/Dinner - $2.48 each
- - Snack - $0.74 each

This text has been shared with you courtesy of:  David & Mary Mellem, EAs & Ashwaubenon Tax Professionals, 920-496-1065 (920-496-9111).

Thursday, January 12, 2017

Tax Year 2016 NYS Driver License Requirement: Overview and FAQs

We heard about similar requirements are recent update seminar in Sturbridge last week...

The New York State Tax Department, in partnership and collaboration with the IRS and other states, continually assesses and improves its fraud deterrence systems for the mutual benefit of the State and its taxpayers, including the tax professional community.

This year, we’ve taken the step of requiring an additional verification measure in personal income tax preparation software: the collection of driver license and state-issued ID information.

Historically, our process of informing the tax preparation community about new requirements has been to communicate and work with tax preparation software developers; test for their compliance before approving; and then notify tax professionals upon issuing each year’s updated Publication 93, New York State Personal Income Tax Modernized e-File (MeF) Guide For Return Preparers For Tax Year 2016.

This year, through the attention of the tax professional community, we’ve recognized an opportunity to enhance our communication with this group to provide accurate and consistent information about upcoming changes such as this requirement. The Driver License Requirement for Tax Year 2016 document, also available on the Tax Professionals landing page, is one of multiple communications steps we’re taking moving forward.