Mazzeffi & Company

Tax Alerts

Tax Briefing(s)

2019 Year-End Tax Planning 2019 Post-Filing Season Update 2018 Year-End Tax Planning

IRS Releases 2020 Inflation-Adjusted Tax Tables, Other Amounts
The IRS has released the annual inflation adjustments for 2020 for over 60 tax provisions, including the income tax rate tables. The IRS issues these cost-of-living adjustments (COLAs) each year to re...

2020 Inflation Adjustments for Pension Plans, Retirement Accounts
The IRS has released the 2020 cost-of-living adjustments (COLAs) for pension plan dollar limitations, and other retirement-related provisions.Highlights of 2020 ChangesThe contribution limit for emplo...

IRS Updates Guidance on Computing Deductions for Operating a Vehicle
The IRS has released guidance that updates Rev. Proc. 2010-51, I.R.B. 2010-51, 883 to reflect changes made to Code Secs. 67 and 217 by the Tax Cuts and Jobs Act (TCJA) ( P.L. 115-97). Rev. Proc. 2010-...

Accounting Method Change Procedures Updated
The IRS has released guidance listing the specific changes in accounting method to which the automatic change procedures in Rev. Proc. 2015-13, I.R.B. 2015-5, 419, apply. This guidance updates and sup...

Proposed Updated RMD Tables Issued
The IRS has proposed updated life expectancy and distribution period tables under the required minimum distribution (RMD) rules. The proposed tables reflect the general increase in life expectancy, an...

Joint Directive on Work Opportunity Tax Credit Issued
The IRS Large Business and International Division (LB&I) and Small Business/Self-Employed Division (SBSE) have issued a joint directive to provide instructions to LB&I and SBSE examiners on th...

New LB&I Campaign on Deferred Foreign Income
The IRS Large Business and International (LB&I) has added a new active campaign to the IRS website called "IRC 965." The campaign’s goal is to promote compliance with Code Sec. 965, Treatmen...

IRS Highlights Steps For Smooth Processing of Taxpayers' 2019 Federal Tax Returns
The IRS urged taxpayers to act now to ensure the smooth processing of their 2019 federal tax return. This reminder, first in a series, was aimed to help taxpayers get ready for the upcoming tax filing...

AL - 2019 general summary of state taxes issued
The Alabama Department of Revenue (department) published the 2019 general summary of state taxes including corporate income, personal income, sales and use, property, motor fuel, tobacco, excise, and ...

AK - Interest rate announced for Q4 of 2019
The Alaska interest rate for delinquent taxes and overpayment of taxes is set at 7.75%, compounded quarterly, for the period October 1, 2019, through December 31, 2019. The Department of Revenue posti...

AZ - Interest rates remains same on underpayment and overpayment for fourth quarter of 2019
The interest rates on underpayments and overpayments of Arizona taxes for the period October 1, 2019, through December 31, 2019, are unchanged from the previous quarter at 5%. The Department of Revenu...

AR - Protest denied as taxpayers were domiciled in Arkansas
The Arkansas Department of Finance and Administration (department) properly assessed a taxpayers’ personal income tax assessment because the taxpayers failed to file a return or submit proof ind...

CA - California cannabis rate changes announced
California announces cannabis cultivation tax rate and mark-up rate changes effective January 1, 2020.Cannabis Mark-Up RateThe California Department of Tax and Fee Administration (CDTFA) determines th...

CO - Remote seller had substantial nexus for sale of exempt products
A remote seller doing business in Colorado had substantial nexus with Colorado and had to collect and remit state sales tax.Meeting the thresholdThe remote seller manufactured and sold baked goods for...

CT - 2019 W-2 electronic filing requirements discussed
The Connecticut Department of Revenue Services (DRS) has updated an informational publication, for corporate and personal income tax purposes, that contains specifications and instructions for electro...

DE - Answers to W-2 and 1099 FAQs for 2019 tax year updated
The Delaware Division of Revenue has updated its answers to frequently asked questions (FAQs) regarding W-2 and 1099 personal income tax withholding requirements for the 2020 reporting period. The FAQ...

DC - Filing process for consumer use tax changed
District taxpayers are required to file Consumer Use Tax on Purchases and Rentals (FR-329) tax return and remit payment through the Office of Tax and Revenue’s online tax portal, https://my...

FL - Certain discretionary sales surtax rate sunset dates announced
A number of Florida discretionary sales surtax rates are set to sunset:the Brevard County 0.5% school capital outlay surtax rate will sunset effective December 31, 2020;the Charlotte County 1% local g...

GA - Sovereign immunity had no application to current litigation
The Georgia Supreme Court partly reversed the decision of the trial court because it was found that sovereign immunity had no application to the current litigation. In this matter, City of College Par...

HI - Film credit final rules adopted
Hawaii has adopted final rules for the motion picture, digital media, and film production income tax credit. The final rules reflect amendments made by Act 275 (S.B. 33), Laws 2019 and Act 143 (H.B. 4...

ID - Maximum homeowner’s exemption unchanged for 2020
The Idaho State Tax Commission has announced that, based on its calculations, the maximum homeowner’s property tax exemption will remain $100,000 in 2020. The maximum exemption is also $100,000 ...

IL - Taxpayer's purchases of metallurgical coke did not qualify for chemical exemption
An out-of-state zinc refining facility operator’s (taxpayer’s) protest against notices of Illinois sales and use tax liability issued by the Department of Revenue (department) was partiall...

IN - Protest sustained as department erroneously sent notice
A corporate income taxpayer’s protest against the Indiana Department of Revenue’s withholding tax assessment notice was sustained as the department failed to send in the notice at the corr...

IA - Iowa issues GILTI and FDII guidance
Iowa has issued guidance reminding taxpayers that beginning in 2019 they:include global intangible low-tax income (GILTI) in Iowa net income; andare allowed the same deductions for foreign derived int...

KS - Q1 local rate changes announced
The Kansas DOR announces the local sales and use tax rate changes below for the quarter beginning January 1, 2020.City Rate ChangesCity rate changes and developments are as follows:Herington (Dickinso...

KY - Selling farmers tax credit program launched
Kentucky has launched Kentucky Selling Farmer Tax Credit (KSFTC) program that offers farmers incentives for selling their property to beginning farmers. The state will begin accepting credit applicati...

LA - Tax filing and payment deadline extended until November 25, 2019
As the Louisiana Department of Revenue (department) faces a ransomware attack, it has granted tax filing and payment extensions until November 25, 2019, for all the tax returns due on November 20, 201...

ME - Bulletin explains what must be included in sale price on which tax liability is based
Maine Revenue Services has updated its instructional bulletin explaining what must be included in the sale price on which sales or use tax liability is based. The bulletin includes a list of what is i...

MD - List of tangible personal property and services subject to tax issued
The Comptroller of Maryland has released a list of tangible personal property (TPP) and services that are subject to sales and use tax. The list may be used as a guide in determining the taxability of...

MA - Individual properly subject to tax as Massachusetts domiciliary
A taxpayer was properly subject to Massachusetts personal income tax because the taxpayer failed to meet his burden of proving that he was domiciled outside of the state during the tax years at issue....

MI - Reminder issued on tax filing due dates
The Michigan Department of Treasury has reminded taxpayers that it will accept 2017, 2018, and 2019 personal income tax returns during the 2020 processing year. Furthermore, Michigan will acknowledge ...

MN - Taxpayer was liable for tax for purchases made after his license expired
A taxpayer was liable for Minnesota motor vehicle excise tax (MVET) for all vehicle purchases made between October 3, 2010, and May 31, 2012, because he did not have a valid dealer license during that...

MS - Lexington imposes 2% tax on prepared food and beverages served at restaurants
Effective November 1, 2019, the city of Lexington imposes a 2% Mississippi local sales and use tax on sales of prepared food and beverages at restaurants.Authorization of TaxLegislation enacted during...

MO - Taxpayer's pain treatment service items used in compounding medications did not qualify for exemption
The Supreme Court of Missouri affirmed the determination of the Administrative Hearing Commission (AHC) which determined that a pain management center’s (taxpayer’s) pain treatment service...

MT - Guidance issued on repatriation, GILTI, and FDII
Montana has explained the corporate income tax treatment of Tax Cuts and Jobs Act provisions concerning deemed repatriation of foreign dividends, global intangible low-taxed income, and foreign-derive...

NE - Temporary penalty and interest waiver granted to certain remote sellers
The Nebraska Tax Commissioner has granted a temporary penalty and interest waiver to remote sellers and multivendor marketplace platforms (MMPs) that were not engaged in business prior to April 1, 201...

NV - Clark county tax increase coming
Nevada’s most populated county, Clark County, will soon see a sales and use tax increase.Sales Tax Rate IncreaseEffective January 1, 2020, Clark County’s sales and use tax rate will be 8.3...

NH - Recent legislation reviewed
New Hampshire has release a summary of legislation enacted this year. The legislation highlighted impacts the business profits tax and business enterprise taxes:rates;IRC conformity;apportionment; and...

NJ - Automatic extension till January 15, 2020 granted for certain fiscal tax year filers
New Jersey corporation business taxpayers filing Forms CBT-100, BFC-1, or CBT-100S are being granted an automatic extension to file their tax returns. Taxpayers filing under this automatic extension w...

NM - Rental of building spaces taxable due to restricted use
A cosmetology business’s (taxpayer’s) receipts from the rental of spaces in its building were properly subject to New Mexico sales and use tax because the rental agreements constituted lic...

NY - New York employer compensation expense program discussed
New York has released a sample template that can be used by employers electing to participate in the Employer Compensation Expense Program. The template notifies covered employees about where they can...

NC - North Carolina standard deduction increased, holding company definition expanded
North Carolina enacted legislation that:increases the standard deduction for personal income taxpayers; andexpands the definition of "holding company" for franchise tax purposes.How Much Is ...

ND - Local taxes and tax rates discussed
The North Dakota Office of State Tax Commissioner (commissioner) has issued a guideline discussing local taxes and tax rates effective October 1, 2019. The guideline provides information on local sale...

OH - Dot announces new W-2 upload feature
For personal income withholding tax purposes, the Ohio Department of Taxation (DOT) has announced that a new W-2 upload feature will be coming soon on the Ohio Business Gateway (OBG) to allow payroll ...

OK - Denial of petition to set aside tax sale upheld
An Oklahoma trial court did not err in denying the taxpayers' petition to set aside the property tax sale because a prospective heir was not entitled to notice of the tax sale under the terms of the s...

OR - FAQs on corporate activity tax discussed
The Oregon Department of Revenue issued a release discussing Frequently Asked Questions (FAQs) concerning Corporate Activity Tax (CAT). Taxpayers with more than $1 million of taxable commercial activi...

PA - Denial of petition to set aside treasurer’s sale upheld
A Pennsylvania the trial court’s decision dismissing the petition of owners of lots within a subdivision (subdivided owners) to set aside the treasurer’s sale of a private street and priva...

RI - Rhode Island 2020 rate schedules, standard deductions, and personal exemptions announced
Rhode Island has released the personal income tax rate schedules, the tax rate schedules for trusts and estates, standard deduction amounts, and personal exemption amounts for the 2020 tax year. Addit...

SC - Taxpayer eligible for legal residence special assessment
The South Carolina Administrative Law Court reversed the property tax assessment issued by the county assessor denying the taxpayer’s application for a legal residence special assessment because...

SD - Publication discusses various sales and use tax topics
The South Dakota Department of Revenue has updated a publication addressing various sales and use tax topics. The updated publication includes information on remote sellers and marketplace sellers. Th...

TN - Sale and installation of modular cleanroom subject to tax
The sale and installation of a modular cleanroom was subject to Tennessee sales and use tax because the cleanroom remained tangible personal property (TPP) after installation. Generally, the sale and ...

TX - Exclusion of funds not allowed where no fiduciary duty established
A taxpayer was not permitted to exclude rent and other fees received from its franchisees when calculating its total revenue for Texas franchise tax purposes because it failed to establish a fiduciary...

UT - Employer withholding tax guide updated
For personal income tax purposes, the Utah State Tax Commission has updated its Employer Withholding Tax Guide to reflect that (1) it is a class B misdemeanor to have Utah employees without a withhold...

VT - Guidance on universal service charge for prepaid calling card sales issued
The Vermont Department of Taxes has issued a publication discussing the Universal Service Charge (USC) for sales and use tax purposes. Act 79 of 2019 has switched the responsibility of collecting the ...

VA - Trial court wrongly excluded taxpayer’s appraiser’s testimony
For Virginia property tax purposes, the trial court abused its discretion when it excluded testimony from the taxpayer’s appraiser because a real estate appraiser is not required to have an acti...

WA - Taxpayer's purchase of point-of-sale services subject to tax
A taxpayer’s purchase of point-of-sale (POS) services from an application provider was properly subject to Washington sales and use tax because the services were taxable digital automated servic...

WV - Publication discussing short-term leases and rentals of real property updated
West Virginia has updated a sales and use tax publication pertaining to short-term leases and rentals of real property. The publication contains tax information for owners and managers of units of rea...

WI - Guidance on 2019 wage and information return reporting requirement issued
For corporate and personal income tax purposes, employers and taxpayers doing business in Wisconsin must file wage statements (W-2s) and information returns (e.g., 1099-MISC) with the Wisconsin Depart...

WY - Local rate change announced
Beginning January 1, 2020, Crook County, Wyoming will eliminate its specific purpose county option tax and decrease its total sales tax rate from 6% to 5%. The notice can be viewed on the department&r...