2016 PSTAP/DOR Annual Meeting
Agenda TY 2016 Form Changes 2017 Tax Amnesty Modernization Initiatives E-Statement of Account Questions & Answer Session www.revenue.pa.gov Click to add footer text > Inform
Recent Form Changes
Corporation Tax Forms Revised Tax Forms for 2016 o RCT 101 o RCT 128 Only one tax being reported Both forms are tax year specific o Prevent filing the wrong form for TY prior to 2016 o New addback and credit lines added www.revenue.pa.gov Click to add footer text > Inform
RCT 101 - Page #1 • Step B : New Checkboxes o Royalty/Related Interest Addback (Act 52 of 2013) o S-Corp Taxable Built-in Gains • Step C : Added address information for o foreign corporations to report special items that don’t “fit” the “normal” address. • Step D : Revised to only reflect the CNI o Tax figures www.revenue.pa.gov Click to add footer text > Inform
RCT 101 - Page #2 Similar to the old page #3 • Sect A : Bonus Depreciation • Sect B : PA Corporate Net Income Tax • Sch C-1: Apportionment Sch . www.revenue.pa.gov Click to add footer text > Inform
RCT 101 - Page #3 & 4 • Same information as the previous pgs #5 – 6 • Bulk Sale Clearance and Tax Preparer areas include the new address information for foreign corporations www.revenue.pa.gov Click to add footer text > Inform
BIT Forms and Instructions Changes • PA-40 Form -- No Changes for 2016 • PA-40 Schedules E, J, T and O — Added line numbers and column references • PA-40 Schedule T – Revised Header and Line 2 instructions • PA-40 Schedule OC -- Added new credit • PA-40 Schedule F – Revised home office deduction and use tax instructions www.revenue.pa.gov Click to add footer text > Inform
BIT Forms and Instructions Changes • REV-276 — Revised PA-41 extension period • PA-40 Schedule SP -- Part C, Line 5, Gifts, awards and prizes • PA-40 Schedules A, B, D, E, J, O, SP, T, UE and W-2s — Line-by-Line instructions developed • PA-41 Form – No changes for 2016 • PA-41 Schedule A – Revised Line 14 instructions www.revenue.pa.gov Click to add footer text > Inform
BIT Forms and Instructions Changes • No PA-1000 Form or Schedules Changes for 2016 www.revenue.pa.gov Click to add footer text > Inform
REV-717 Form Changes REV- 717 Retailers’ Information Guide Changes 11
Sales Tax Vendor Discount The vendor discount for licensees for timely filed returns and payments has been limited to the lesser of: $25 or 1% of the tax collected for a monthly filer $75 or 1% for a quarterly filer $150 or 1% for a semi -annual filer 12
Electronically or Digitally Delivered Items Sales and use tax extended to items delivered to a customer electronically or digitally or by streaming. This includes music or any other audio, video such as movies and streaming services, e-books and any otherwise taxable printed matter, apps and in-app purchases, ringtones, online games, and canned software, as well as any updates, maintenance or support of these items. 13
E-911 Fee The E-911 Surcharge is a fee collected by retailers on each prepaid wireless telephone or prepaid telecommunication service sold. The fee increased to $1.65 per retail transaction. The surcharge is charged and collected by the retailer in addition to any other charges or fees but is not to be included when calculating sales tax. 14
E-911 Discount The discount available to retailers that timely remit pre-paid e-911 surcharge returns and payments is 1.5 percent. This discount is separate from the timely remitting of sales tax returns and payments and will automatically be calculated by the department. Both discounts are applicable only if the return is filed and payment in full is made on or before the sales tax due date. 15
Monthly Prepayment Obligations Sales and use tax licensees whose actual tax liability for the third calendar quarter of the preceding year is $25,000 but less than $100,000 must pay 50 percent of the tax liability for the same month of the previous year or remit at least 50 percent of the actual tax liability required to be reported for the same month in the current year. 16
Monthly Prepayment Obligations Businesses remitting $100,000 or more for the third calendar quarter of the preceding year must remit 50 percent of the tax liability due for the same month of the previous year. Prepayments are due by the 20th of the current month, and returns for the period are due on or by the 20th of the subsequent month. . 17
Wine Sold for Off Premises Consumption Act 39 created a wine expanded permit (WEP) for restaurant and hotel licensees. This permit allows it holders to sell wine for off-premises consumption A maximum of 3,000ml (3 liters) can be sold in a single transaction. 18
Wine Sold for Off Premises Consumption Holders must pay sales tax on purchases made from PLCB at the time of purchase and are required to collect the tax from the consumer purchasing the wine-to-go. WEP holders may recover the tax paid on the original purchase price when filing their Sales, Use, and Hotel Occupancy Tax Return with the Pennsylvania Department of Revenue. 19
Wine Sold for Off Premises Consumption A licensee may claim a “Taxes Paid – Purchases Resold” (TPPR) credit on a sales tax return within three years of a purchase that is resold and should keep documentation supporting the TPPR credits for at least three years from the date the return is filed. 20
Tax Amnesty
2017 TAX AMNESTY PROGRAM Pennsylvania authorized (under Act 84 of 2016) a 60-day PA Tax Amnesty program April 21, 2017 through June 19, 2017 100% of penalties and half of the interest will be waived Legislative initiative intended to provide $100 million to the General Fund. Last tax amnesty was in 2010 www.revenue.pa.gov Click to add footer text > Inform
2017 TAX AMNESTY PROGRAM The overwhelming majority of taxpayers pay their state taxes on time. Pa Tax Amnesty is an opportunity for the rest to pay back taxes and for taxpayers with delinquencies unknown to the Department of Revenue to come forward. www.revenue.pa.gov Click to add footer text > Inform
ELIGIBLE TAXES All taxes administered by the department are eligible. More than 30 taxes in all, including: Corporate net income tax Personal income tax Capital stock/foreign franchise tax Inheritance tax Sales and use tax Cigarette tax Employer withholding tax www.revenue.pa.gov Click to add footer text > Inform
ELIGIBLE DELINQUENCIES Taxes delinquent as of December 31, 2015 are eligible; taxes delinquent after January 1, 2016 are ineligible. Example: 2014 is the last PIT return eligible for amnesty. Unknown tax delinquencies as of January 1, 2011 must be filed and paid before amnesty ends. Non-filed periods due before December 31, 2015 must be filed before the amnesty period end. www.revenue.pa.gov Click to add footer text > Inform
PARTICIPATION RESTRICTIONS Unemployment compensation (administered by the PA Department of Labor & Industry) or any taxes administered by another state, local government or the IRS are ineligible. Any taxpayer under criminal investigation, criminal prosecution, or criminal restitution for an alleged violation of tax law is ineligible. Non-Amnesty eligible non-filed returns (e.g. 2015 personal income tax return must be filed but are not required to be paid to participate in amnesty. 2010 tax amnesty participants are ineligible, but 1996 Tax Amnesty participants are eligible. www.revenue.pa.gov Click to add footer text > Inform
PARTICIPATION RESTRICTIONS A taxpayer in bankruptcy is ineligible unless permission is granted by the Bankruptcy Court. Taxpayers with eligible tax liabilities that are under appeal must withdraw the appeal to participate. Participants that become delinquent within two years of the program may be required to pay all waived penalties and interest. www.revenue.pa.gov Click to add footer text > Inform
CONSEQUENCES OF NONPARTICIPATION Eligible individuals or businesses who do not participate in the 2017 PA Tax Amnesty program to settle back taxes will have: a 5 percent non-participation penalty added to delinquencies and; may face other enforcement actions. www.revenue.pa.gov Click to add footer text > Inform
HOW TO APPLY To obtain PA Tax Amnesty, a taxpayer must do the following between April 21 and June 19, 2017: file an Amnesty application; file necessary returns, if applicable; and pay all delinquent taxes and 50 percent of the interest due. www.revenue.pa.gov Click to add footer text > Inform
NOTIFICATION Letters will be mailed to taxpayers with known tax delinquencies. Next, phones calls may be made to taxpayers with known tax delinquencies. Additional information about the notifications will be provided closer to the start of the program. www.revenue.pa.gov Click to add footer text > Inform
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