Mazzeffi & Company

Tax Alerts

April 07, 2021

Tax Briefing(s)

American Rescue Plan Act of 2021 2020 Tax Year-In-Review Consolidated Appropriations Act, 2021 (revised)2020 Post-Election Tax Policy Update

IRS Update on Economic Impact Payments
On March 17, the IRS, Treasury, and the Bureau of the Fiscal Service announced that they had disbursed approximately 90 million Economic Impact Payments (EIPs) from the American Rescue Plan. EIPs are ...

IRS Clarifies 2020 Unemployment Payment Treatment
On its website, the IRS has provided instructions on reporting 2020 unemployment compensation following the enactment of the American Rescue Plan Act.For taxpayers with modified adjusted gross income ...

SBA Introduces New PPP Loan Application Forms
The Small Business Administration has introduced new Paycheck Protection Program (PPP) loan application forms for borrowers that are Schedule C filers. These new applications reflect new rules that al...

Guidance on Employee Retention Credit for 2020
The IRS has issued guidance for employers claiming the COVID-19 employee retention credit under Act Sec. 2301 of the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) ( P.L. 116-136), as ...

Alert on Improper DPAD Refund Claims
The IRS has issued an alert concerning amended returns and claims for the domestic production activities deduction (DPAD) under Code Sec. 199, which was repealed as part of the Tax Cuts and Jobs Act f...

Large Cash Transaction Reporting Reminder
The IRS has reminded businesses of their responsibility to file Form 8300, Report of Cash Payments Over $10,000. Generally, any person in a trade or business who receives more than $10,000 in cash in ...

IRS Resources Available in Multiple Languages
The IRS has said that it continues its efforts to expand ways to communicate to taxpayers who prefer to get information in other languages. For the first time ever, the IRS has posted a Spanish langua...

2021 Foreign Housing Expense Amounts
The IRS has provided the foreign housing expense exclusion/deduction amounts for tax year 2021. Generally, a qualified individual whose entire tax year is within the applicable period is limited to ma...

AL - Town of highland lake imposes local taxes
Effective March 1, 2021, the town of Highland Lake imposes various local Alabama sales and use and lodgings taxes.Sales And Use TaxesThe following sales and use taxes are imposed at the indicated rate...

AK - Refund claim denied as untimely
For Alaska corporate income tax purposes, a corporation and its subsidiaries (taxpayer) was properly denied the taxpayer’s refund claim as untimely. In this matter, the taxpayer identified underrepo...

AZ - Guidance provided on sales of adult use marijuana
Arizona has begun providing guidance on the adult use (recreational) marijuana excise tax. Adult use marijuana dispensaries must remit transaction privilege tax (TPT) and marijuana excise tax (MET) to...

AR - Practitioners required to file certain returns electronically
Enacted legislation requires tax practitioners to file a taxpayer’s Arkansas income tax return electronically if the taxpayer’s federal income tax return was filed electronically. However, the req...

CA - California authorizes golden state stimulus payments authorized
California will provide stimulus payments to millions of low-income Californians under the Golden State Stimulus plan. The one-time payments provide financial relief to households who have been advers...

CO - Revised guidance on capital gain subtraction issued
The Colorado Department of Revenue has updated its guidance regarding the corporate and personal income tax subtraction allowed for certain qualified capital gain income if it is included in federal t...

CT - Trial court's decision upheld for failure to provide income and expense information, penalty not excessive
For Connecticut property tax purposes, a town assessor could impose a 10% penalty on a taxpayer for failure to respond to the assessor's request for rental income and expense information related to th...

DE - Department's limitation policy violated Delaware constitution's uniformity clause
In a corporate income tax matter, the Delaware Superior Court (court) determined that the Division of Revenue's (department) limitation policy violated the state Constitution's Uniformity Clause. In t...

DC - Troops serving in dc receive tax exemption
A temporary sales and use tax exemption is available to deployed state and federal troops providing security to the District of Columbia. The exemption applies to hotel stays for the troops during the...

FL - Guidance on 1099-K reporting requirements issued
Florida issued guidance on 1099-K income tax reporting requirements for:credit companies; andthird-party settlement organizations (TPSOs).Reporting RequirementsEffective January 1, 2021, credit card c...

GA - IRC conformity bill goes to governor
The Georgia senate passed legislation to update the state’s income tax Internal Revenue Code (IRC) conformity date. The bill incorporates federal tax law changes enacted on or before January 1, 2021...

HI - Publication discussing taxation of agricultural and aquacultural producers updated
The Hawaii Department of Taxation has updated its Tax Facts publication that discusses the sales and use tax applicability to agricultural and aquacultural producers. An agricultural or aquacultural p...

ID - IRC conformity updated
Idaho Governor Brad Little has signed legislation updating the state’s Internal Revenue Code (IRC) conformity date from January 1, 2020, to January 1, 2021, for personal and corporate income tax pur...

IL - FAQs for marketplace facilitators, marketplace sellers, and remote retailers revised again
Illinois again revised sales and use tax frequently asked questions (FAQs) for marketplace facilitators, marketplace sellers, and remote retailers. Previous revisions to the FAQs were discussed in a s...

IN - IRC conformity bill passes house
The Indiana House passed legislation to updated the state’s income tax Internal Revenue Code (IRC) conformity date. The bill incorporates federal tax law changes in effect on January 1, 2021. H.B. ...

IA - Municipal corporation's purchases of TPP exempt from tax
Purchases of tangible personal property (TPP) by a municipal corporation (taxpayer) were exempt from Iowa sales and use tax because the taxpayer was an instrumentality of the counties that formed it. ...

KS - Kansas privilege tax interest income deduction created
Kansas created a deduction for interest income on certain loans by financial institutions subject to the privilege tax.Eligible Loans and InterestBanks, trust companies, and savings and loan associati...

KY - Third-party purchaser failed to comply with notice requirements
For property tax purposes, the Supreme Court reversed the Court of Appeals’ decision affirming the circuit court’s decision granting summary judgment and confirming a foreclosure sale because a ge...

LA - Local tax collectors required to submit proposed judgments
For sales and use tax purposes, the Louisiana Board of Tax Appeals (BTA) ordered two local tax collectors to submit proposed judgements regarding the amount of tax they were entitled to collect based ...

ME - Changes to 2020 individual tax forms discussed
Maine Revenue Services has issued a Tax Alert discussing significant changes to 2020 individual income tax forms. In addition to certain line update changes, Schedule PTFC/STFC has been revised to ref...

MD - Temporary waiver of estimated tax interest for farmers and fishermen announced
For personal income tax purposes, the Comptroller of Maryland issued a news release informing farmers and fishermen who are impacted by provisions of the Recovery for the Economy, Livelihoods, Industr...

MA - Guidance on corporate estimated tax payments updated
The Massachusetts Department of Revenue issued updated administrative procedure guidelines on requirements to pay estimated corporate excise tax. The guidelines provide information on:Requirement to m...

MI - Residence of minister serving in administrative capacity was exempt
The Michigan property tax exemption for a "parsonage" applied to the residence of an ordained minister who did not have a designated congregation but performed an administrative role for her church....

MN - Individuals working from home due to covid-19 may have forms w-2 with improperly allocated wages
Individuals may have received 2020 Forms W-2 with improperly allocated wages if they:normally work in one state, but live in another state; andworked from home due to the COVID-19 pandemic.For Minneso...

MS - Judgement affirmed as taxpayer's roofing service was properly subject to tax
The Mississippi Court of Appeals affirmed the chancery court’s decision that a taxpayer’s sale and installation of roofing materials were subject to sales tax. In this case, the chancery court gra...

MO - Interest rate on refunds decreased for second quarter of 2021
The interest rate on all qualifying Missouri tax refunds is 0.9% for the period from April 1, 2021, through June 30, 2021. The interest rate is 1.2% for the period from January 1, 2021, through March ...

MT - Business tax express is retiring March 31
The Montana Department of Revenue (department) issued a news update informing sales and use taxpayers that the Business Tax Express (BTE) will no longer be available after March 31, 2021. BTE users ar...

NE - Family corporation exemption explained
The Nebraska Department of Revenue has provided guidance on the application of the documentary tax stamp exemption for transfers involving family corporations, partnerships and limited liability compa...

NV - Home office credit ended December 31; tax treatment of credit discussed
Nevada taxpayers previously issued a 2020 estimated Home Office credit amount based on the previous year’s Ad Valorem may apply the Home Office Credit to the 2020 Insurance Premium Tax Reconciliatio...

NH - Taxability of covid-19 financial relief discussed
New Hampshire has released guidance discussing the taxability of certain COVID-19 financial relief programs under the business profits tax (BPT) and business enterprise tax (BET).State ReliefAll state...

NJ - Governor proposes middle-class tax relief
New Jersey Governor Phil Murphy has proposed the following personal income tax changes in his recommended budget for fiscal year 2022:expand the Veterans’ Property Tax Deduction to those who served ...

NM - Hearing scheduled on combined reporting regulations
The New Mexico Taxation and Revenue Department will hold a public hearing on February 25, 2021, on proposed corporate income tax regulations related to mandatory combined reporting and market based so...

NY - Exemption denied for failure to show painting was purchased for resale
A limited liability company’s (taxpayer's) purchase of a one-half interest in a painting that was subsequently leased was not exempt from New York sales and use tax because the taxpayer failed to sh...

NC - 2021 withholding tables and instructions released
The North Carolina Department of Revenue (department) has released the 2021 personal income tax withholding tables and instructions for employers. The tables and instructions have been updated to ref...

ND - Annual oil trigger price adjustment for 2021 announced
North Dakota has announced the annual oil trigger price adjustment for oil extraction tax purposes.Oil Trigger PriceThe oil trigger price is $89.65 for the calendar year January 1, 2021, through Decem...

OH - Municipal net profit tax return is due march 15
For corporate income tax purposes, the Ohio Department of Taxation (department) reminds all municipal net profit tax (MNPT) practitioners and taxpayers that the return for taxpayers with a November fi...

OK - Postjudgment interest not applicable to ad valorem refund
Taxpayers could not use the general postjudgment statute for purposes of their successful Oklahoma ad valorem tax appeal because the procedure for interest is provided for in the ad valorem statute. T...

OR - Corporate activity tax webpage updated
Corporate income taxpayers may now access FAQs related to corporate activity tax (CAT) grouped together in a single page at Oregon Department of Revenue’s CAT webpage. The FAQs are grouped together...

PA - Untimely petition remanded as department's information was misleading
A corporate income taxpayer's review petition was untimely filed and was remanded to the Pennsylvania Department of Revenue (department) as the department’s letter misled the taxpayer to appeal in t...

RI - Taxpayer's motion for summary judgment due to existence of genuine issue of material fact
For Rhode Island property tax purposes, the taxpayer’s motion for summary judgment was denied because there existed a genuine issue of material fact concerning whether the taxpayer’s property was ...

SC - Guidance on low income housing tax credit discussed
South Carolina, in a revenue ruling, provides an overview of the state housing tax credit (credit), and addresses general questions about the state credit, for corporate income tax purposes. The reven...

SD - IRC conformity updated
An IRC conformity bill was signed updating South Dakota’s bank franchise (income), property, and sales and use tax federal conformity date to the most recent version of the federal Internal Revenue ...

TN - Taxability of data analytics services discussed
The Tennessee Department of Revenue issued a letter ruling discussing the applicability of sales and use tax to a taxpayer’s provision of data analytics services. In this matter, the taxpayer provid...

TX - Texas franchise tax deadline extended
Texas has extended the due date for 2021 franchise tax reports from May 15 to June 15. The Comptroller announced the extension in response to the recent winter storm and power outages in the state. Th...

UT - Income tax penalties improperly assessed against part-year residents
The Utah State Tax Commission (commission) waived personal income tax penalties assessed against part-year state residents as the Auditing Division (division) improperly included penalties in its amen...

VT - Governor proposes elimination of tax on military pensions and other tax provisions
Vermont Gov. Phil Scott has proposed the following in his annual budget address:an increase in the funding of the Downtown and Village Center Tax Credit Program, which provides a credit against corpor...

VA - Assessment at issue was cancelled and reversed; appeal denied
In a letter ruling, the Virginia tax commissioner determined that a taxpayer’s appeal against sales and use tax assessment was "not necessary" as the assessments at issue were cancelled and revers...

WA - Taxability of sales by registered tow truck operators explained
The Washington Department of Revenue has updated sales tax guidance on the taxability of auction sales by registered tow-truck operators (RTTO). An abandoned vehicle sold by an RTTO at public auction ...

WV - IRC conformity date modified
West Virginia modified its IRC conformity date for determining:corporation net income tax liability; andpersonal income tax liability.IRC Conformity DateTaxpayers computing West Virginia income tax li...

WI - Updated information on tax treatment of active military personnel issued
The Wisconsin Department of Revenue has issued a fact sheet providing personal income tax information for active military personnel. Topics discussed in the fact sheet include filing requirements, leg...

WY - Tax lien requirements amended
Provisions on perfecting an ad valorem tax lien relating to Wyoming mineral production have been amended. For liens prior to and after January 1, 2021, a new owner extracting the mineral cannot presen...