NY NATP E-News. NYS P[i^ F[mily L_[v_ (PFL) Up^[t_ by Dan Paoletti, EA. November 2017

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1 November 2017 NYS P[i^ F[mily L_[v_ (PFL) Up^[t_ by Dan Paoletti, EA 2017 NY Chapter Board Edward Arcara, CPA Chapter President George Powers, EA Chapter Vice President Christina Parisi Chapter Secretary Christopher Bertuglia, EA Chapter Treasurer Chapter Office: NY NATP 1129 Front Street Binghamton NY Fax Newsletter Committee: Kathryn M. Keane, EA Christina Parisi & Tricia Santana Contributors: Dan Paoletti, EA Roman Bellusci, CPA Christina Parisi The NYS Tax Department has issued Notice N giving the first guidance on the tax implications of the new Paid Family Leave program. Here are specifics as outlined in the notice: Benefits paid to employees will be taxable non-wage income that must be included in federal gross income. Taxes will not automatically be withheld from benefits; employees can request voluntary tax withholding. Premiums will be deducted from employees after-tax wages. Employers should report employee contributions on Form W-2 using Box 14 State disability insurance taxes withheld. Benefits should be reported by the State Insurance Fund on Form 1099-G and by all other payers on Form 1099-MISC. If you are just hearing about the PFL program for the first time or for a refresher on the basics, here are the highlights: This new benefit is completely funded by employees through a payroll deduction. Employers are not required to withhold - they can choose to pay the cost for their employees. The initial payroll deduction rate is.126% of all wages paid up to $1, per week. That is a maximum deduction of $1.65 per week. Each employer will be required to purchase a policy to cover the new PFL program. It will be included or as a rider to existing NYS Disability policies. An employer can start deducting on wages earned as of July 1, Employees can make a claim for benefits starting 1/1/18. Employees need to give 30-day notice for foreseeable leave. An employee must be employed full-time for 26 weeks or part-time for 175 days for eligibility. For further details see the following website: As tax filing season approaches, it would be a good idea to keep on top of the PFL details and its tax implications. There will sure to be questions from our client s! This topic, plus many other current NYS and Federal tax issues will be discussed at this year s NY NATP Essential Annual Seminar. There are dates and locations still available. Go to and click on Education to register.

2 Page 2 of 6 A Message for All CPA s By Roman Bellusci, CPA Gov. Cuomo signed the peer review bill into law on Oct. 23, firms with two or fewer CPAs that provide attest services to clients and want to continue to provide them will need to undergo a peer review every three years. For any firm that begins providing ATTEST (Audit & Review Not Compilation) services, The SED is thus requiring firms both to notify the SED and to enroll in a peer review program within 30 days of becoming subject to mandatory participation, so that the firm may meet the 18-month requirement. Firms providing services as described in Education Law section 7401-a, or who otherwise become subject to the mandatory participation in the peer review program shall: I. Notify the department of its change in status within 30 days and provide the department with evidence of enrollment in an acceptable peer review program; and II. The firm shall have a peer review completed within 18 months of the date such services were first provided. For More information please visit Purchasing a Quickfinder? Will you be buying a Quickfinder for the coming season? We all use these guides and the New York Chapter receives a donation for each book ordered when you use the Association Code below or Special Order Form provided at: Quickfinder Association Code Q680 The NY Chapter THANKS YOU FOR YOUR SUPPORT!!

3 Page 3 of 6 Income Tax Relief for Individuals Affected by the Flooding of Lake Ontario and the St. Lawrence Seaway NYS recently announced guidance on income tax relief for certain individuals whose primary residences were damaged by the flooding of Lake Ontario and the St. Lawrence Seaway. Individuals may take a subtraction modification when using a distribution from an eligible retirement plan to pay for repairs to their primary residences. For a taxpayer to be eligible for relief, all of the following requirements must be met: The taxpayer s primary residence must be located in the area affected by the disaster declared by Executive Order 165 of This area includes the counties of Cayuga, Jefferson, Monroe, Niagara, Orleans, Oswego, St. Lawrence, and Wayne. The taxpayer must have sustained damage to his or her primary residence due to coastal flooding, widespread erosion, and water damage ( the flood damage ). The damage to the taxpayer s primary residence must qualify for a casualty loss deduction under Internal Revenue Code (IRC) 165 (determined without regard to whether the loss exceeds 10% of the taxpayer s federal adjusted gross income). The taxpayer must take a distribution from an eligible retirement plan and use the distribution during the taxable year to pay for eligible repairs to his or her primary residence. See TSB-M-17(2)I for complete details. Further information about this topic as well as many others are discussed at the NY NATP Essential Annual Seminar. Have you made plans yet to attend an Essential Seminar? If not, there are plenty of choice dates and locations still available. Go to and click on Education to register. Tax Relief in Disaster Situations UPDATE Hurricane Irma: On 11/2/17 the IRS expanded the Hurricane Irma tax relief to certain counties in South Carolina. This includes Individuals who reside or have a business in Abbeville, Allendale, Anderson, Bamberg, Barnwell, Beaufort, Berkeley, Charleston, Colleton, Dorchester, Edgefield, Georgetown, Hampton, Jasper, McCormick, Newberry, Oconee, Pickens and Saluda Counties. Relief is available for taxpayers in U.S. Virgin Islands, Puerto Rico, Florida, Georgia. Hurricane Harvey: The IRS announced today that affected taxpayers in Louisiana will receive tax relief. This includes Individuals who reside or have a business in Acadia, Allen, Assumption, Beauregard, Calcasieu, Cameron, DeSoto, Iberia, Jefferson Davis, Lafayette, Lafourche, Natchitoches, Plaquemines, Rapides, Red River, Sabine, St. Charles, St. Mary, Vermilion and Vernon Parishes. California Wildfires: Taxpayers in Butte, Lake, Mendocino, Napa, Nevada, Orange, Solano, Sonoma, and Yuba Counties may qualify for tax relief. Hurricane Maria: U.S. Virgin Islands: The islands of St. Croix, St. John, and St. Thomas. Puerto Rico: This represents all 78 municipalities of Puerto Rico.

4 Page 4 of 6 Upcoming January Series Basic 1040 & 201 The NY Chapter will be hosting several locations for our January Basic 1040 & 201. This hands-on seminar will provide basic 1040 and New York State tax preparation training to beginning tax preparers, assistants, inputters, office managers and clerical support teams. The seminar will give attendees a better understanding of the inputting process for basic 1040 and NYS tax returns. Keep checking our website for more information and dates! Not an NATP Member Yet? Join Today, Save $28 NATP is the leading organization dedicated to tax professionals and the clients they serve. We encourage you to become part of the NATP family! Not only is Chapter membership included with your general membership, but you ll also receive access to our expert education, publications and updates, research services, business tools and a community of equally dedicated professionals. Become a member today and receive $28 off the regular price of membership. Use code CHAPTER2017 to receive the discount. When joining, be sure to include the state Chapter that recruited you in the field that asks, Who recommended you to NATP? If you have any questions, call Member Services at , ext. 3, or National at natp@natptax.com.

5 Page 5 of 6 Fall Series Lineup! Essential Class: Retirement Tax Issues: Examines tax treatment of qualified retirement plans, QDROs, annuities and Social Security. How to identify retirement income and how it impacts all tax returns. Safe harbor method of calculating taxable income, calculating taxable Social Security benefits and Lump Sum election will be covered. (2 CE Cir. 230 preparers) Exploring Education Tax Issues: Examines the usual and unusual situations when we have an educational deduction or credit. Due diligence, AOTC, LLC, 529 plans, 1095T and Coverdell will be covered with examples and the pecking order in which they are applied. You will elevate your tool kit to handle education issues with this class. (2 CE Cir 230 preparers) Tax Season Issues: Every year our education committee members get stumped by an unusual situation. Included this year are: basis calculations, reporting gifts to children or siblings, amounts that need to be included on 1099-MISC, recognition or non-recognition of gain or loss, custodial issues and use of Form 5329 to either calculate or exclude early distribution penalties. (2 CE Cir. 230 Preparers) NYS Update & Hot Topics: Driver s license mandate, NYS refund hold program, NYS Energy Credit with examples, NYS small business subtraction modification with examples. (No federal CE) NYS DTF: A representative from the NYS Department of Taxation and Finance will discuss recent issues facing NYS. (0 federal CE; 0 CE for NYS) IT201/203 Class: This is the perfect course for office staff, new preparers or experienced preparers wanting a complete review of the New York personal income tax return. Learn what your software program doesn t do for you! Fall Series Dates December 7-8- Queens New! Register Online: For more information on hotels, pricing and a printable registration form visit:

6 Page 6 of 6 NY Chapter of NATP 1129 Front Street Binghamton NY Fax PHONE: FAX: stateoffice@newyorknatp.com NY Chapter Founders Award Past Winners The NY Chapter is proud to announce our new website: NewYorkNATP.com Visit our website to stay up to date on the most recent developments from NYS DTF, to learn more about our upcoming seminars, catch the newest edition of this newsletter and so much more! Ralph Sommers 2013 Wendy C. Loomis 2014 Karl Herba 2015 Dwayne Rocky Rhodes 2016 Kathryn M. Keane 2017 We re on FaceBook! Search for NY NATP!