July 2013 NEW YORK CHAPTER. President's Message. National Association of Tax Professionals New York Chapter President's Report July 2013

Transcription

1 NEW YORK CHAPTER July 2013 President's Message National Association of Tax Professionals New York Chapter President's Report July 2013 Nick Kounios, fa Chapter President Sally Fahey, EA Chapter Vice President Katrina Marois, fa Chapter Secretary Kathleen Garrow, fa Chapter Treasurer Chapter Office: 1129 Front Street Binghamton, NY (800) (607) fax Summer is in full swing and I hope you have scheduled a well deserved vacation for you and your family away from the tax office in the coming months. Your colleagues at NY NATP hit the ground running after tax season. The Board of Directors met in Albany on May 31 st and the Education Committee met on June 1 st to finalize plans for the fall educational line up. The Chapter will be offering the NY Essential Series from October 21 st through November 1st at 12 locations across the state. We will also be offering the popular NY IT-201 and IT-203 at four of these locations. I am very excited to announce that new this year, we will also be offering an S Corp workshop at two locations (Fishkill, NY and Long Island NY). Please check the Chapter Weekly Newsletter for specific dates and locations. Finally, be sure to mark your calendar for our Annual meeting at Turning Stone on October 28 in Verona, NY. The other big event on our calendars is the National Conference being held July 7-11 at the JW Marriott Desert Ridge in Phoenix, AZ. If you are planning to be at conference, please be sure to stop by our meet and greet for the NYS Chapter on Wednesday July 10 from 5:30-7:00 in the Vista lounge. I will be there with many other board members and look forward to the opportunity to talk with you about the exciting things happening at NATP.

2 President's Message Continued The longer I am in this business,the more I realize that time for recreation and education don't just magically appear on my calendar. I encourage you to proactively set time aside for both of these activities between now and the end of the year. A new tax season will be upon us before we know it and what better way to head into our busy time than well rested and excited to practice new skills. I look forward to seeing each of you at the seminars this fall. Have a terrific and safe summer! All my best, Nick Kounios, EA NY NATPChapter President Interested in Serving on the NY Chapter Board of Directors? The nominations committee has started putting together the ballot for next veer's board of directors election. Anyone interested in serving on the board can contact Chairman Matthew Hall at Matt@HaliandCoCPAs.com or President Nick Kounios at Nick.Kouniois@ptaxx.com. Elections are scheduled to be held at our annual meeting at Turning stone in October. Several regions will have openings to fill and there should be at least one At-Large spot to fill. Please help to continue to make the NYChapter the premier place to learn about tax updates. New York Wage Project Michael Novick, EA, Esq. Many of us prepare returns for taxpayers who live in New Jersey and work in New York state. This article will talk about the New Jersey Division of Taxation's New York Wage Project. This initiative focuses on the Credit for Taxes Paid to

3 Other Jurisdictions (which is computed on NJ Schedule A and is analogous to the NYSResident Credit on IT-112-R).The initial program reviewed returns filed for tax year 2009 whose statute of limitations expired on April 15, However, in light of the current economic climate where state tax departments are tapping all available revenue sources, it would not be much of a stretch to see it continue into the future. Here are a few examples; unlessotherwise indicated, all taxpayers live in NJ and work in NY: Dick worked in NY and earned $50,000. He also collected $5,000 in unemployment compensation paid by the NYSDepartment of Labor. His wife, Jane, worked in NJ and earned $60,000. Federal AGI comes to $115,000and the same figure goes in the left hand column on IT-203. NY source income (right hand column, IT-203)will be $55,000. However, NJ doesn't tax unemployment so NJ gross income will only be $110,000. In order to calculate the NJ resident credit, you divide the amount of income that was taxed to both states by the NJ gross income. The denominator is $110,000but how much is the numerator? Dick's wages are taxed in both states so they will be included in the numerator. Since the unemployment is only taxed by the nonresident state of NY,it will not count towards the credit. Accordingly, the numerator is$50,000. Lizis a single mom. She earned $100,000but set aside (and used) $5,000 for dependent care. As a result, her W-2 shows $95,000in taxable wages for federal and NY purposes. However, NJ does not recognize pre-tax deductions other than for 401(K) contributions and she will report the full $100,000on Form NJ In this case, the numerator of the credit ratio will be $95,000, the amount of wages taxed by nonresident state NY. (Note: It is becoming increasingly common for employers to issue 2 separate state W-2s, 1 for NY reflecting $95,000 and the other for NJ showing $100,000. Whether or not this is the case, we should review the information to determine that the correct amount has been reported on the respective state returns.) Jamie earned $80,000 and contributed $5,000 to a fully deductible traditional IRA. She claims the $5,000as an adjustment to income on her federal and NY returns. However, NJ does not allow a deduction for IRA contributions and her NJ Grossincome will be $80,000. How much is the numerator of her credit ratio? Since NYallowed Jamie to deduct the IRA contribution, only $75,000 was double taxed and that's what will be shown as the numerator on NJSchedule A. Doesn't your software do these calculations automatically? For the amount of money we spend, we probably have the right to expect that it does but be careful. A few months ago, one of my clients received a Wage Project notice.

4 I The situation was identical to the 1st scenario above (one spouse worked in NY and also collected NY unemployment). Only the wages go into the credit calculation but I obviously didn't look closely enough. I was embarrassed to have to tell them that I was wrong and NJ was right. The moral of the story (and anyone who has ever sat in one of my classes has probably heard this before): Know what your software does... as well as what it doesn't do Save the Date! NY Chapter Annual Meeting The NY Chapter will hold its Annual Meeting on Monday, October 28 th at Turning Stone Resort & Casino in Verona (Syracuse area). Not only will you receive topnotch education and mingle with other members & the Board of Directors, you will be staying at one of Central New York's premier destinations. Stay tuned for more information! Tax Department Expands Team in NYC to Better Serve Spanish-Speaking Taxpayers New service reps help set up payment consumer rights plans, work through issues, explain In another step forward for its language access initiative, the New York State Taxpayer RightsAdvocate said today that the Tax Department has added staff and supervisorsat its main New York City office to better serve Spanish-speaking taxpayers. The Advocate - Camille Siano Enders- announced the change before a gathering of consumer advocates and non-profit organizations meeting in Brooklyn. "Thiscustomer service initiative will help us to better assistdownstate taxpayers while eliminating the language barrier for Spanish-speaking individuals," she said.

5 Lastyear, Governor Andrew M. Cuomo signed an Executive Order directing all state agencies to help people with limited Englishproficiency better interact with State government. Aligning with that effort, Tax Department added language translation resources to accommodate the most commonly spoken non-englishlanguages in New York State. Ms. Siano Endersnoted that the highest number of language assistance telephone calls from taxpayers involve Spanish- often as many as 2,000 per month. The six new bilingual taxpayer service representatives and their two supervisors are located at the Tax Department's MetroTech office complex on Jay Street in Brooklyn. The Advocate said that expanding our Spanish-speaking representatives in New York City improves the Department's ability to assistthe Spanish-speaking community downstate, while supplementing the existing Spanish-speaking staff in Albany, where the Tax Department is headquartered. Ms. Siano Endersalso told the advocacy groups today that the Tax Department has added outreach specialists throughout the state in an effort to improve communication with taxpayers. Through a regional approach, these specialists will focus on raising awareness on the availability of important credits for low and moderate income New Yorkers,including the Earned Income Tax Credit. NY Chapter NA TP Presents S Corporation Seminars Attend one day or both days - 16 CEs available. Dayt "Preparing S Corporation Returns" This hands-on workshop is designed for tax professionals who want to expand their tax practice by preparing S corporation returns. We'll take a line-by-line look at Form 1120S and certain accompanying schedules. This course is ideal for individuals who have never prepared an S corporation return before or have very limited experience. Plus the completion of the corresponding New York CT-3S return. (Basic) Day2 "Intermediate S Corporations" This hands-on course is ideal for tax professionals who have prepared S corporation returns and are looking to improve their skills to assist clients with their continuing needs. Topics covered include reasonable compensation, book to taxable income reconciliation, built-in-gains tax, distributions and shareholder basis, shareholder loss limitations and ownership changes. Plus the changes necessary for the New York CT-3S return. (Intermediate) Instructors will be: Edward Arcara, CPA from Buffalo, NY Karl Herba, EA from Fayetteville, NY Kathryn Keane, EA from Brooklyn, NY

6 2013 S Corporation Seminar Registration (Check box of seminar selections) Day 1 Man 8/5 Wed 8/7 Preparing S Corporation Returns Hauppauge Sheraton Long Island Hotel 110 Motor Parkway Hauppauge, NY Fishkill Ramada Conference Center 542 Route 9 Fishkill, NY Da 2 Tues 8/6 Thurs 8/8 Intermediate S Corporations. Hauppauge Sheraton Long Island Hotel 110 Motor Parkway Hauppauge, NY Fishkill Ramada Conference Center 542 Route 9 Fishkill, NY Current NATP Member: Yes / No PTIN #. (PTINlName must match) Name: Designation: EA CPA CFP Other Company Name: Street: City, State, Zip: Phone: PAYMENT (circle one): Check Enclosed / VISA / MasterCard / AMEX (No Discover Card) Name on Card: Amount: Credit Card#: Exp. Date: See Codej, Signature: REFUND POLICY: NY NATP will retain a $25 administrative fee for cancellation prior to 7 days of seminar. NO REFUND will be given for cancellations within 7 days of seminar. Questions? nynatpstateoffice@)att.net or Phone: