2014 Changes - Louisiana Department of Revenue

Report
2013 New Year Change & Practice
Update Seminar
October 2013
Presented by
Leonore Heavey, Barbara Reeves, and Bobbie Swafford
Louisiana Department of Revenue
1
Disclaimers
• This presentation is “informal advice” as
contemplated by Louisiana Administrative Code
61:III.101.D.3, which provides that informal
advice does not have the force and effect of law
and is not binding on the Department, the public,
or the individual seeking advice. Informal advice
will have no effect on an audit
• Any opinions expressed are those of the
presenters
2
WHAT’S NEW FOR 2013
INDIVIDUAL INCOME TAX
3
DOMA
• IRS Revenue Ruling 2013-17 requires same sex
couples who were married in a state that
recognizes same sex marriage to file married
filing joint or married filing separately
• LDR response—RIB 13-024
• Current advice:
– File your clients’ Louisiana tax returns as you would
have prior to the IRS ruling
• See page 21 & What’s New section of the
Resident return
4
Non Refundable Child Care Credit
• Child Care Credit Carried Forward From 2009 Through
2012 – Line 12C –
• The child care tax credit for taxpayers whose federal
adjusted gross income exceeds $25,000 is not
refundable. Unused credit amounts can be used over
the next four years.
• For the 2013 tax year, credits carried forward from
2009 through 2012 can be applied on Line 12C.
• Any remaining child care credit from 2008 has
prescribed can not be applied to the 2013 tax liability.
(R.S. 47:297.4)
5
School Readiness Credit Carryovers
• School Readiness Credit carried forward from
2009 through 2012 – Line 12E –
• The school readiness credit for taxpayers whose
federal adjusted gross income exceeds $25,000
may not be refunded and any unused credit
amounts can be used over the next four years.
• For the 2013 tax year, credits from 2009 through
2012 can be applied on Line 12E. (R.S. 47:6104)
• Any remaining credit from 2008 has prescribed
and cannot be used on the 2013 tax return
6
School Readiness Credit for Child Care
Directors and Staff
• Refundable credit for eligible child care
directors and staff
• Based on certain attained qualifications
• 2013 credit amounts based on CPI-U
adjustment:
Staff Qualification Level
Level IV Director or Level IV Staff
Level III Director or Level III Staff
Level II Director or Level II Staff
Level I Director or Level I Staff
Increase
from 2012
$66
$55
$44
$33
Credit for 2013
$3,212
$2,676
$2,141
$1,606
7
Sugar Cane Trailer Conversion Credit
• The refundable credit for conversions made in
2013 is limited to $6,500 per trailer
• 2013 is the last year the credit can be earned
• No tax credit allowed for costs paid on and
after January 1, 2014
• See RIB 09-026 for more information and for
each year’s per trailer credit cap
• R.S. 47:6029
8
Changes to Solar Energy Systems
Credit
• Act No. 428 of the 2013 Regular Session of the Louisiana
Legislature made numerous changes to the tax credit
provided in La. R.S. 47:6030 including:
– Wind systems no longer qualify
– Credit no longer available for installations at residential
apartment complexes
– Significant differences between eligibility for leased versus
purchased systems
– All system components purchased on or after July 1, 2013 must
be compliant with the American Recovery and Reinvestment Act
of 2009-- “Buy American” (See RIB 13-013)
– Credit phases out with a final sunset of January 1, 2018
• See RIB 13-026, Solar Energy Systems Tax Credit, for more
information about the changes
9
Alternative Fuel Vehicle Credit
Changes
• Act 219 of 2013 specifies that flex fuel vehicles do not qualify
• Act 427 of 2013 changed the definition of “alternative fuel” to
“natural gas, liquefied petroleum gas, and any nonethanol
based advanced biofuel”
– Removes ethanol as alternative fuel
– Retains electricity, but only if the vehicle
– (a) has at least four wheels; (b) is manufactured primarily for use
on public streets, roads, and highways and is able to attain a
maximum speed of at least fifty five miles per hour; and (c) is
propelled by an electric motor which draws electricity from a
battery which has a capacity of not less than four kilowatt hours
and is capable of being recharged from an external source of
electricity
– Low speed electric vehicles are no longer eligible
• See RIB 13-023 for more information
10
Federal Income Tax Deduction
• Two new Affordable Care Act taxes took effect
in 2013
• 1. Net Investment Income Tax
– Will be added to federal taxes paid for purposes of
determining the FIT deduction because it is a tax
on net income
• 2. Additional Medicare Tax
– Will NOT be added to federal taxes paid for
purposes of determining the FIT deduction
11
New Additional Donation
• SNAP Fraud and Abuse Detection & Prevention
Fund, Line 41, page 5 (“Amount Due Louisiana”
section)
• For tax years beginning on and after January 1,
2013
• The monies in the fund may be appropriated by
the legislature only to enhance fraud and abuse
detection and prevention activities related to the
Supplemental Nutrition Assistance Program.
• Created by Act 635 of 2012
12
Schedule D—Donation of Refund
•
Line 4—SNAP Fraud and Abuse Detection and Prevention Fund–This fund
provides fraud and abuse detection and prevention activities related to the
Supplemental Nutritional Assistance Program. (R.S. 47:120.39)
•
Line 7—Checkoff donation for the Louisiana Prostate Cancer Trust Fund has
been changed to the Louisiana Cancer Trust Fund
•
Line 12—Louisiana Bicentennial and Battle of New Orleans Commissions.
Current donations will be distributed to the Battle of New Orleans
Commission; the Bicentennial Commission has ended by operation of law.
•
Line 22—Decorative Lighting on the Crescent City Connection (Act 194 of the
2013 Regular Legislative Session)
•
Line 23—Operation and Maintenance of the New Orleans Ferries (Act 194 of
the 2013 Regular Legislative Session)
•
Line 24—Louisiana National Guard Honor Guard for Military Funerals (Act 392
of the 2013 Regular Legislative Session)
•
Line 25—Bastion Community of Resilience. Taxpayers may donate all or part of
their refund for the development of innovative housing for recent war
veterans and their families.
13
Refund Options
• Act 818 of 2012—For tax years 2013, 2014 and 2015
taxpayers may choose among 3 options
– Paper check
– MyRefund card
– Direct deposit to bank account
• Default is MyRefund card.
• Taxpayers will receive a MyRefund card if:
– No refund option chosen
– Direct deposit account number is incomplete or
unreadable
14
Refund Reissue Notices
• Refund reissue notices--“blue letter”
• For refund cards issued in 2012 that have not
been activated, and
• Un-cashed checks issued in 2012,
• Refunds for taxpayers who did not respond to
LDR by October 18, 2013 will be turned over
to Unclaimed Property
15
WHAT’S NEW FOR 2013—
CORPORATE, COMPOSITE
PARTNERSHIP, AND SALES & USE TAX
16
Corporate Income Tax
• No short form (dormant corporations and non-profits with
UBTI will file the CIFT-620)
• Schedule G - Reconciliation of Federal and Louisiana Net
Income:
– Line 2d has been changed to require the reporting of Louisiana
depletion in excess of federal depletion.
– Line 2e has been changed to require the reporting of expenses
not deducted on the federal return due to Internal Revenue
Code Section 280C.
– Line 2f has been changed to report subtractions from federal
net income other than those reported on lines 2a through 2e.
– Lines 2d through 2f were previously blank, allowing the
reporting of subtraction items other than those reported on
lines 2a through 2c.
17
Corporate Income Tax
• Non Refundable Credits - Schedule NRC:
Dedicated Research - Code 220 - This credit
has been deleted from the return.
• Tax Credit changes (see Individual Income Tax)
– Solar energy systems, RIB 13-013 & RIB 13-026
– Alternative fuel vehicle, RIB 13-023
– Sugar cane trailer conversion, RIB 09-026
18
Corporate Tax Incentive Changes
• Changes were made to several tax incentive
programs administered by other state agencies.
Contact the certifying agency to determine if your
client is impacted by these program changes.
• Louisiana Economic Development (LED)
–
–
–
–
Research & Development Credit
Motion Picture Investor Credit
Enterprise Zone Credit/Rebate
Ports Investor Credit
• State Historic Preservation Office (CRT)
– Commercial Historic Rehabilitation Credit (RIB 13-022)
19
Composite Partnership Return
• Electronic only for 2013 tax year Via MEF
• Nonresident individual partners only
– Resident partners cannot be included
– No payments will be made by the partnership on
behalf of resident partners
– Consider adjusting estimated payments
• Will now include tax credits earned by the
partnership
• Extensions for the composite return will also
be electronic only
20
Sales and Use Tax
• Change to Vendor’s Compensation:
– Rate reduced from 1.1% to 0.935%
– See RIB 13-020
• Taxpayers must use current form to properly calculate the
correct vendor’s compensation amount
– Use R-1029 (7/13) from July 2013 forward
– Use R-1029 (7/12) for tax periods between July 2012 to June
2013
• Using the wrong return will cause processing delays and
may require you to refile using the correct return
• If the July 2013 return was filed before the new return was
available, if you pay any additional tax resulting from the
decrease in vendor’s compensation, interest and penalty
will be waived
21
Sales and Use Tax—Exemptions
• Act 271 [R.S. 47:305(D)(2)(a)] expands the exemption
for patients and staff of hospitals to exempt the sale of
meals furnished to staff and residents of nursing
homes, adult residential care providers, and continuing
care retirement communities
– Effective June 13, 2013, however the provisions of the Act
are retroactive.
• Other legislative changes—go to
http://revenue.louisiana.gov/ click on “Publications”
tab and select “Legislative Summaries”
– Legislative Summaries are available for 1996-2013
22
Sales and Use Tax—Exemption
Certificates
• As of August 1, 2013, the state and local sales and use
tax exemption certificate for sales occurring at events
sponsored by nonprofit organizations may be obtained
annually from LDR instead of on a per event basis
• Beginning January 1, 2014, direct pay, sale for resale,
and manufacturing machinery and equipment sales tax
exemption certificates will be renewed automatically
unless
– LDR determines the taxpayer no longer qualifies for the
exemption, or
– Taxpayer has not met its filing and payment obligations
23
Use Tax Enforcement Authority
• Act 425 of 2013 created R.S. 47:302(U):
– Collection of consumer use tax. It is the duty of the
secretary of the Department of Revenue to collect all taxes
imposed pursuant to this Chapter and Chapters 2-A and 2B of this Subtitle which may be due upon the sale by a
remote seller of tangible personal property or services in
Louisiana. The secretary is authorized and directed to
employ all means available to ensure the collection of the
tax in an equitable, efficient, and effective manner.
• If you do not already include a question regarding
online or catalog purchases on which your clients paid
no sales tax, please add such a question.
24
Use Tax Enforcement Activities
• LDR Discovery Unit is utilizing third party data
to assist with use tax compliance
• Pilot—Tobacco Excise and Use Tax notices
– Mailed late September 2013
– Covers periods 2003-2009
– Letter includes print out of all tobacco products
purchased from out of state vendor where taxes
not remitted by vendor or taxpayer, including
date, product, quantity and purchase price
25
Fiduciary and Partnership
Information Extensions
• Please use appropriate form
– Fiduciary—R-6466 (prior to 2012, R-6466 was for
both returns)
– Partnership—R6463
• As these returns become electronic, the
extensions will become electronic
• Look for fiduciary to become electronic for
2014 returns filed in 2015
26
AMNESTY 2013—A FRESH START
27
Amnesty Basics
• Act 421 of the 2013 Louisiana Legislature instituted a threeyear statewide state tax amnesty program
• The dates for Amnesty 2013:
– Monday, September 23 – Friday, November 22
• The deal for Amnesty 2013:
Pay 100% of the tax, all fees and ½ of the interest owed &
LDR will waive 100% of the penalty and the other ½
interest
– In 2014, no penalty waiver and only 15% of interest will be
waived
– In 2015, no penalty waiver and only 10% of interest will be
waived
• The website: http://ldrtaxamnesty.com/
• The phone number: 866-782-9241
28
Amnesty Tips
• If your client only owes penalty, they must
apply via the website. Penalties will not be
waived without an application.
• If a taxpayer cannot afford to take advantage
of amnesty for all eligible periods, tax periods
can be deselected on the Amnesty website
• No installment agreements accepted for
amnesty unless all payments received by LDR
by November 22, 2013.
29
No Amnesty Invitation?
• Invitations were mailed to most recent address
LDR had on file. Call amnesty phone number to
obtain letter ID number then apply via the
amnesty website
• Decedents did not receive an amnesty invitation.
Representatives may walk in or call to determine
payoff amount. Proof of representation is
required.
• Taxpayers with taxes under field audit and
litigation were mailed letters with contact
information. Call to determine payoff amount.
30
Amnesty LDR Walk-in Site
Alexandria
• 2nd Floor, Rapides Parish Courthouse
701 Murray Street
Alexandria, Louisiana 71301
• 8:00 a.m. – 4:00 p.m. on the following days:
 October 1, 3, 8, 10, 17, 18, 22, 24, 29, and 31
 November 5, 6, 7, 12, 13, 14, 15, 18, 19, 20, 21,
and 22
31
Amnesty LDR Walk-in Site
Lafayette—Site I
• Representative Vincent Pierre
800 W. Congress St., Suite A
Lafayette, Louisiana 70501
• 9:00AM-3:00PM (This office opens at 9:00a.m.
and closes from 12:00 to 1:00pm for lunch)
• October 1-2, 7-9, 14-16, 21-23, 28-30
• November 5-7, 12-15, 18-22
32
Amnesty LDR walk-in site
Lafayette—Site II
• Department of Children and Family Services
825 Kaliste Saloom Rd.
Brandywine Complex Bldg 6, Suite 100
Lafayette Louisiana 70501
• 8:00AM- 3:00AM
• October 1-4, 8-11, 15-18, 22-25, 29-31
• November 1, 5-8, 12-15, 18-22
33
Amnesty LDR Walk-in Site
Lake Charles—Site I
• Representative A.B. Franklin
2808 East Broad Street
Lake Charles, Louisiana 70615
• 8:00 AM-4:00 PM (This office closes from
12:00-1:00 PM for lunch)
– October 1-3, 8-10, 15-16, 22-23, 29-30
– November 5-7, 12-15, 18-22
34
Amnesty LDR Walk-in Site
Lake Charles—Site II
• Senator Ronnie Johns
1011 Lakeshore Dr., Suite 515
Lake Charles, Louisiana 70601
• 8:30am - 4:00pm
• (This office opens at 8:30a.m. and closes from
12:00pm to 1:00pm for lunch)
• October 1-3, 8-10, 15-16, 22-23, 29-30
• November 5-7, 12-15, 18-22
35
Amnesty LDR Walk-in Site
Monroe
• Monroe State Office Building Room #242, 2nd
Floor Conference Room
122 St John Street
Monroe, Louisiana 71201
• 8:00 a.m. – 4:00 p.m. on the following days:
 October 2, 3, 9, 10, 16, 17, 23, 24, 30, and 31
 November 5, 6, 7, 12, 13, 14, 15, 18, 19, 20, 21,
and 22
36
Amnesty LDR Walk-in Site
New Orleans
• Louisiana Department of Revenue, Southeast
District (504-568-5233)
1450 Poydras Street Suite 800
New Orleans, Louisiana 70112
• 8:00 AM – 4:00 PM (This location closes from
12:00 p.m. to 1:00 p.m. for lunch.)
• September 23-November 22, 2013
37
Amnesty LDR Walk-in Site
Shreveport
• Shreveport State Office Building Conference
(Room located in Basement)
1525 Fairfield Avenue
Shreveport, LA 71101
• 8:00 a.m. – 4:00 p.m. on the following days:
 October 2, 3, 9, 10, 16, 17, 23, 24, 30 and 31
 November 5, 6, 7, 12, 13, 14, 18, 19, 20, 21 and 22
38
PRACTICE UPDATES
—DOING BUSINESS WITH LDR
39
INDIVIDUAL INCOME TAX
AVOIDING DELAYS
40
Individual Income Tax
▶File electronically
▶E-Services help line (225)-219-2490 or -2488.
▶Refund turnaround –
– 12-16 weeks for paper
– 21 days for e-filed
41
Individual Income Tax
Modern E-filing (MEF) will allow for the submission of
PDF files with e-filed returns.
Return attachments can also still be submitted via EFax number:
 (225) 231-6221
Include taxpayer’s name, account number and tax
filing period on the top of the first page.
42
Tips to Remember
• Carefully check social security numbers.
• Be sure that mailing addresses are kept up to
date.
• When entering the mailing address, be sure it
matches the Postal Service information.
• If the address doesn’t match perfectly, there will
be processing delays.
43
Address Changes
 Taxpayers must ensure that their mailing addresses
are up to date
 Failure to update a changed mailing address can result in
delayed income tax refunds and correspondence
 Please update your address with the US Postal
Service. LDR does monthly updates.
 You can change your address on the LDR
website:www.revenue.louisiana.gov/AddressChange
 Businesses can add or change addresses in LaTap
using the edit feature.
44
Common Filing Delays
 Name issues -- Always file with the same names
(first, middle, last) in the same order each year.
 Math errors.
 Conflicts with third party data or compliance
reviews.
▶Difference in estimated payments and credit
carry forwards reported compared to LDR
records.
45
Common Filing Delays
“Other” claimed on Schedule E, F or G.
Large Refunds.
Amended Returns completed incorrectly.
 Tip--Amended returns should be completed as if no
other return was ever filed for the period.
46
Paper Return Tips
• Use the correct year form
• Submit all pages of the tax return even if left
blank
• Supply all essential information and complete the
entire return
• All taxpayers must sign the return as well as a
third party preparer
• Be sure that your printer ink is working properly
and the return is easily read.
47
Paper Return Tips
• Don’t mail checks without a tax return or
appropriate voucher.
• Make sure to include the Social Security
Number(s) or the account number and tax
year on all payments and correspondence.
• Be sure to make the check payable to the
Louisiana Department of Revenue.
48
Paper Return Tips
• Returns with a balance due go to a different
PO Box than refund returns
– A return for which a payment is due should be
mailed to:
P.O. Box 3550, Baton Rouge, LA 70821-3550.
– All other individual income tax returns should be
mailed to:
P.O. Box 3440, Baton Rouge, LA 70821-3440.
49
Paper Return Tips
• If requesting a direct deposit of a refund,
carefully check the bank account and routing
numbers.
• Sending your return via certified mail or
courier will not speed processing of your
return and will more likely delay your refund.
50
Documentation Required
 Tax Return Instruction Booklets provide
documentation requirements for each credit.
 Instruction Booklets can be downloaded from
the LDR website or call (225) 219-2113.
 IVR interactive forms request rollout
anticipated by year end.
 If required documentation is not submitted,
credit will be denied until documentation
provided.
51
Refunds
 MyRefund Cards
 Optional for the 2014 filing season.
 MyRefund cards are administered by Chase.
 Contact Chase @ 866-586-1704
 To activate
 For lost or stolen cards
 To check card balance
52
MyRefund Cards
 To request a check—Do not activate card.
Contact LDR.
 If card is held for 6 months or longer before
check request, check issuance process can be
very lengthy.
 If card not activated with one year, funds are
returned to LDR
 MyRefund card good for 3 years, but only if
activated with the first year.
53
Citizens Insurance
 RIB 12-030 provides information on Claiming the
Credit for Citizens Property Insurance
Assessments
 Claim once per tax period on IT-540 or IT-540INS
or CIFT-620 or CIFT-620INS
 Claim in the tax period that corresponds with
date the assessment paid.
 Under current Citizens bond repayment
schedule, Citizens assessments eligible for the
credit will be paid through 2024.
54
Citizens Insurance
 If paid in 2012, claim credit on INS in 2012 or
claim on the 2012 tax return due in 2013.
 Do not claim unless client has declaration page
from insurance company and proof of payment.
 Submit copy of declaration page with paper filed
returns only.
 Keep declaration page for four years if return e-filed.
 If paper INS Form is used refund will be by check
 www.revenue.louisiana.gov/citizens
55
Citizens Insurance
 Under R.S. 47:1623A, refunds prescribe three
years from the 31st day of December of the year
in which the tax became due.
 A Citizens assessment paid in 2009 must be
claimed on the 2009 income tax return or 2009
INS Request for Refund form.
 Taxes associated with 2009 income tax returns
became due on January 1, 2010.
 Refunds of Citizens assessments paid in 2009
must be claimed no later than 12/31/2013.
56
CORPORATION INCOME AND
FRANCHISE TAX
AVOIDING DELAYS
57
Common Filing Errors
 FAILURE TO FILE INITIAL CFT RETURN
 CFT-4 — minimum $10 due unless LLC.
 Due by 15TH day of 3rd month following month of
incorporation.
 Provides administrative information including FYE.
 Accounts will be set up as calendar year end without
initial franchise return.
58
Common Filing Errors
DORMANT ENTITY FAILURE TO FILE RETURNS
 Annual returns still remain due after corporation
stops operating and/or filing federal returns.
 Returns continue to be due until dissolution,
revocation or withdrawal from the Secretary of State.
 Estimated assessments will be issued if no return is
filed until the account is officially closed.
59
Common Filing Errors
 FAILURE TO FILE FINAL RETURN
 Final return due for end of the accounting period.
 No franchise tax due.
 Tax due if gains realized on liquidation of assets.
 Close account using form on website and copy of the
dissolution from Secretary of State.
 Failure to dissolve with the Secretary of State will
result in billings.
60
Common Filing Errors
 NO ACCOUNT NUMBER ON RETURN
 Since 2005 CIFT returns subject to
administrative or negligence penalty.
 5% OR $10.00, whichever is greater.
 CIFT returns now returned if LA account
number not on return.
61
EXTENSION OF TIME TO FILE
ELECTRONIC MANDATE
62
Extension Requests
▶ Beginning with returns due in 2013, taxpayers
needing additional time to file an individual or
corporate income tax return will need to
electronically submit a request for an extension
of time to file.
▶ Reminder: By filing an extension application, you
are requesting only an extension of time to file.
▶Not an extension of time to pay the tax.
▶Payments received after the return due date will be
assessed interest and late payment penalty.
63
Extension Requests
 Electronic extension requests may be
submitted via:
 The Department of Revenue’s web site at
www.revenue.louisiana.gov.
 Telephone -- IVR (225) 922-3270
 Third party tax preparation software
64
LOUISIANA GENERAL SALES TAX
AVOIDING DELAYS
65
Filing Frequency
▶Filing Frequency
 A taxpayer can have their filing frequency changed.
However, the change must be requested in writing
and approved by the Department.
 Filing frequencies are reviewed by the Department
once a year and notices are sent to the taxpayers.
Changes are effective at the beginning of the
calendar year.
66
Sales Tax Errors
▶USING THE WRONG FORM
 The sales tax return has changed several times in the
last few years.
 The line #’s and/or the deduction percentages
change from year to year.
 Be sure the form is correct for the period being filed.
 Never manually correct a preprinted form.
67
Sales Tax Errors
▶ MUST USE BAR CODED RETURN FOR CORRECT
PERIOD
 Use taxpayer bar coded return if possible. This speeds up
processing.
 Bar code has all taxpayer information as well as the filing
period.
 Computer will read bar code, it cannot read any manual
adjustments made to the return.
68
Sales Tax Errors
▶LINE ITEM ERRORS
 If no transactions for the period, put zero on Line 1.
 Do not use “-0-” for a zero – no quotes or dashes
 Write numbers legibly and within the box.
 Do not use cents – round to nearest dollar.
69
Sales Tax Errors
▶OTHER ERRORS
 Taking vendors compensation on delinquent or no
remit returns
 Deductions on front of return with no details on
back of return
 Using incorrect deduction or exemption
70
Claim for Refund Due to Bad Debts
 Form R-20127 Claim for Refund (Bad Debts)
 The debt must be deducted on a federal income tax
return before the Department can issue a sales tax
refund on a bad debt.
 Do not use this form as a substitute for the filing of an
amended return or to correct an error on a previously
filed tax return.
 The Department will process one refund claim per
year for each dealer.
 If all or some portion of the debt is collected, the
amount collected shall be reported as a new sale for
the period when the recovery is made.
71
Parish E-File Program
 Parish E-file is a web-based application allowing
businesses to file sales tax returns and remit sales
tax payments for local tax authorities from one
centralized site.
 Free online service available on LDR website.
 For questions, visit [email protected] or
call (225)-219-2203 Help Desk.
72
DISCOVERY
FEDERAL/STATE MATCH & MISMATCH
73
Federal/State Match Program
 LDR receives an electronic transmission from the IRS
on taxpayers who have filed federal tax returns with
Louisiana mailing addresses.
 LDR identifies taxpayers who have not filed Louisiana
returns for the period.
 LDR then sends Federal/State Match questionnaires
to those taxpayers.
74
Federal/State Match Questionnaire
• Please respond to this questionnaire, if you are
not required to file a Louisiana income tax return
for the year.
• It is less burdensome to clear up before an
estimated assessment is issued.
• Notice of Intent to Offset and/or Suspend
Licenses.
• Debt will be submitted to FMS (Federal
Management Services) to offset federal refund.
• Debt could be assigned to a collection agency.
75
Federal/State Match—Failure to
Respond to Questionnaire
• If no response is received within the allotted time, a bill is
generated.
• Failure to respond can bring a matter to seizable status in just
over 3 months:
• 30 Day Proposed Assessment
• 60 Day Formal Assessment
• SOFA
• Notification of seizable status
76
Optional Reply to Questionnaire
Military
• I was a member of the armed service
stationed in Louisiana. None of my income or
my spouse's (if applicable) was derived from
Louisiana sources. My legal state of residence
for the referenced tax period was the State of
__________________________.
77
Federal/State Match—Military
Personnel
• The Barksdale legal office is working with LDR to come up with
a program to ensure local military members are taxed in
accordance with the proper state laws.
• Airmen can bring a copy of their orders and a W-2 form to the
legal office and they will handle the issue.
• For more information contact the 2 BW legal office at (318)
456-2562.
• LDR hopes to work with other military bases in the state to
come up with a solution to the issue of military personnel with
Homes of Residences in other states . Neither they or their
spouses are subject to LA Individual Income Tax.
78
Optional Reply to Questionnaire
Already Filed
• If you have filed a Louisiana income tax
return:
–
–
–
–
return this letter,
a copy of your Louisiana return,
W-2 forms and,
if applicable, a copy of the canceled check.
79
Optional Reply to Questionnaire
Not Required to File
• If you believe you were not required to file a
Louisiana income tax return:
– Set forth your reasons why you were not
required to file in the appropriate area on the
back of this letter
– Return the letter to LDR with documentation to
substantiate your stated reasons (such as a copy
of a return filed with another state or other proof
of residency, etc.)
80
Optional Reply to Questionnaire
Need to File
• If you were required to file a Louisiana income
tax return, but have not:
– Contact an office of the Department of Revenue if
a tax return is needed. 225-219-2113 or 225-9223270
– The return can also be downloaded from
www.revenue.louisiana.gov
– Or, file electronically
81
Federal/State “Mismatch”
• Program recently implemented in Louisiana that
matches federal information to state information,
including
–
–
–
–
AGI
FIT
Itemized Deductions
Filing Status
• Some first year errors were encountered
– Schedule E and H reconciliation issues
– IRS error on decedent returns with only one exemption
– Although some billings are in error, not all are. Contact
LDR to be certain.
• Reviewing 2010 information during upcoming year
82
Remaining 2009 Schedule E or H
Issues?
• If your client received a notice regarding
individual income tax liability for 2009 and you
suspect a Schedule E or Schedule H error,
contact:
• Bobbie Swafford at (225) 219-2062 or by email
at [email protected]
83
IRS ADJUSTMENTS
84
IRS Adjustments
• Louisiana Revised Statute 47:103(C) requires
taxpayers, whose federal returns are adjusted,
to furnish a statement which discloses the
nature and amounts of such adjustments.
• This disclosure must be furnished within 60
days after the adjustments have been made
and accepted.
– Related Amnesty tip: If RAR refund adjustment
not submitted to LDR within 60 days, no refund
will be allowed
85
CP2000 and RAR Adjustments
 CP2000’s are automatic adjustments made
from electronic matches of information data
returns received by the IRS.
 RARs (Revenue Agent Reports) are results of
an IRS audit.
86
CP 2000 and RAR Adjustments
 Why did I receive this notice?
 The IRS made changes to your federal return so LDR
made the corresponding changes to your state
return.
 You must provide verification of subsequent changes
from the IRS to dispute LDR’s changes to AGI or FIT.
87
CP 2000 and RAR Adjustments
 How do I dispute the state adjustment?
 A current IRS account transcript should be provided.
 LDR’s proposed assessment will not be adjusted until
documentation is received verifying that the IRS has
changed their audited amounts.
88
SUSPENSION OF LICENSES
COLLECTION INITIATIVES
89
Driver’s License Suspension
 R.S. 47:296.2 provides for the authorization to
suspend the driver’s license of Louisiana taxpayers
who have an outstanding individual income tax
liability;
 LDR promulgated LAC 61:I.1355 as the rule to further
define how this statute is applied.
90
Driver’s License Suspension
▶ License
will be suspended if:
 A liability reaches final and non-appealable status, and
 Taxpayer owes in excess of $1,000 in net tax for any one
period.
 Net tax due is defined as tax due reported (or assessed
in the event of no return filed) less any payments or
credits processed for the period, exclusive of any
interest, penalties, or fees.
91
Driver’s License Suspension
 Regular driver’s licenses, as well as, Commercial
driver’s licenses will be suspended.
 However, Class I (ID cards) and Class H (Handicapped
licenses) will not be suspended.
 The Department of Public Safety will charge $60
reinstatement fee each time the license is
suspended.
92
Drivers License Suspension
▶What if the taxpayer files married filing
jointly?
 The driver’s license of the primary SS# will be
suspended.
 In the event the husband is the primary on one
period, and the wife is the primary on another and in
excess of $1,000 is owed on both periods, both
licenses will be suspended.
 Both will have to pay the DPS $60 reinstatement fee.
93
Driver’s License Reinstatement
▶Reinstatement process:
 If the liability is an estimate, the taxpayer must file
returns.
 Taxpayer will have to pay the entire liability or enter
into an installment agreement.
 Installment agreements, require 20% down payment
with 12 months payout or less.
94
Driver’s License Reinstatement
▶Reinstatement process:
 Once payment is made or an installment agreement
entered, LDR will issue the taxpayer a clearance letter.
 The letter will be signed with the embossed state seal.
 The taxpayer must bring the original clearance letter to
DPS and pay the $60 fee to have the driver’s license
reinstated.
95
Driver’s License Reinstatement
▶Reinstatement process:
 Taxpayer must physically bring the clearance letter to
DPS – they do not accept faxed or mailed clearance
letters;
 A breached installment agreement results in another
suspension and an additional $60 reinstatement fee.
96
Hunting and Fishing License
Suspension
 LSA R.S. 47:296.3 provides for the authorization to
suspend hunting and fishing licenses of Louisiana
taxpayers who have an outstanding individual
income tax liability.
 LDR promulgated LAC 61:I.1351 as the rule to
further define how this statute is applied.
97
Hunting and Fishing License
Suspension
▶Criteria to suspend hunting or fishing license:
 Taxpayer owes in excess of $500.00 in net tax for any one
period.
 Net tax due is defined as tax due reported (or assessed in
the event of no return filed) less any payments or credits
processed for the period, exclusive of any interest,
penalties, or fees.
 WLF does not charge a reinstatement fee.
98
Hunting and Fishing License
Reinstatement
Reinstatement process:
 If the liability is an estimate, the taxpayer
must file returns.
 Taxpayer will have to either pay the entire
liability or enter into an installment
agreement for payment.
99
Hunting and Fishing License
Reinstatement
 Reinstatement process:
 Once the taxpayer has made payment, or entered into
the installment agreement, the LDR employee will issue
the taxpayer a clearance letter.
 The clearance letter will be faxed to Wildlife and
Fisheries (WLF).
 The taxpayer does not have to go to WLF to have license
reinstated.
100
Removal of License Liens via Credit
Card Payment
 Note: Using a credit card to pay balances due
requires additional transaction time if licenses have
been levied for prior non-payment.
 Once taxpayer obligations are met, LDR will notify
and authorize the issuing state agencies to remove
liens within 72 hours.
101
REMITTING PAYMENTS
& DOCUMENTATION
& HOW TO GET IN TOUCH WITH LDR
102
Tax Payments
 If you received a notice of tax due, mail your
payment and the payment coupon to LDR in the
reply envelope.
 Electronic payment options are convenient, safe, and
secure methods of paying taxes. You can authorize
an electronic funds withdrawal, or use a credit card
or a debit card.
 For more information on electronic payment options, visit
the LDR website at www.revenue.louisiana.gov
103
Tax Payments
▶ Individual income tax liabilities may be paid
electronically by an electronic bank account debit via
the Louisiana File Online application
▶ Business tax liabilities may be paid electronically using
LaTap
• Or pay by credit card using Official Payments at
www.officialpayments.com.
– Credit card payments may also be initiated by telephone at
1-888-272-9829.
– Credit card payments incur a 2.49 % convenience fee.
104
Contact Us
 General
(225) 219-7318
 Individual
(225) 219-0102
 Business
(225) 219-7462
 IVR
(225) 922-3270
(#1 Refunds, #2 Electronic Funds Transfer, #3 Electronic Extension
Request, #4 Credit Card Payments, #5 Tax Forms, #6 Other.)
 Forms
(225) 219-2113
 http://revenue.louisiana.gov/sections/taxforms/orderforms.aspx
105
Contact Us
▶ Collections




General
Enforcement
Fax
ReveFax
▶Office Audit
 ReveFax
(225) 219-2244
(225) 219-7448
(225) 219-0866
(225) 231-6237
(225) 231-6238
▶LaTap, LaWage, and Parish E-File
(225) 219-2203
106
Documentation Requested by
Collection Division
• Collections/Enforcement Fax Numbers
(225) 231-6237
(225) 219-2256 Individual
(225) 219-0865 Business
Telephone: (225) 219-7448
Address:
P.O. Box 66658
Baton Rouge, LA 70896-6658
107
Contact Us via Email
• Send an email via the LDR website and your
inquiry will be directed to the appropriate
division.
https://esweb.revenue.louisiana.gov/Contact
Us/default.aspx
• Please allow 3-5 business days for a response.
108
DO NOT send documentation via Email
boxes on LDR website.
• Do not send documentation that has
been requested by Office Audit Division
or the Collection Division via these email
boxes.
• Use snail mail or fax.
109
SOME FINAL INFORMATION
MISCELLANEOUS TIPS
110
Administrative Penalties
In addition to the delinquent filing and
payment penalties, other administrative
penalties may be assessed-Negligence Penalty
 Assessed for repeated delinquent filings.
 5% of tax or $10.00, whichever is greater.
Collection Fee
 Assessed when a tax period has been in seizable
status for 61 days or more.
 Fee 15% of the total unpaid balance.
111
Federal Offset Program
▶If taxpayer is paying a debt through an installment
agreement, any money received through the Offset
Program will reduce the length of the agreement,
but it will not affect the scheduled payment amount.
▶Any unpaid amount will remain eligible for offset
until it is paid in full. Interest, penalties and fees will
continue to accrue until all of the tax debt has been
paid in full.
112
“November 18” Due Date Letters
• Some taxpayers who requested extensions via
the LDR website received letters stating that
November 18, 2013 is the final extended due
date for 2012 IIT returns
• The actual due date is Friday, November 15
• The November 18 due date will be honored
for those taxpayers who received letters with
this error
113
Frequently Asked Questions (FAQs)
http://revenue.louisiana.gov
• Examples:
– How can I get a copy of my tax return?
– How can I make a payment with my extension
request?
– Can I amend my return on the department’s website?
– I filed my individual income tax electronically and
selected to have my refund deposited directly into my
bank account. It has been over two weeks and the
money has not been credited. What should I do?
114
LDR Subscription Services
• Tax Topics Subscription Service
– If you would like an e-mail when LDR posts a new Tax
Topic, please submit the information requested at this
link:
– http://www.revenue.louisiana.gov/sections/Publications/t
tss.aspx
• Policy Statement Subscription Service
– If you would like an email when LDR issues or updates a
Policy Statement, submit the information requested at
this link:
– http://www.revenue.louisiana.gov/sections/lawspolicies/
psss.aspx
115
Our Contact Information
• [email protected][email protected][email protected]
Thank you!
116

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