Mazzeffi & Company

Tax Alerts

Tax Briefing(s)

2018 Year-End Tax Planning Tax Reform 2.0 2018 Post-Filing Season Update Congress Approves Sweeping Tax Overhaul

IRS Clarifies Treatment of Refunds with New SALT Limits
The IRS has provided four examples of the interaction of the new limit on the deduction on state and local taxes (SALT) under Code Sec. 164(b)(6) with the tax benefit rule for refunds under&...

Plug-In Electric Vehicle Credit to Phase Out for GM Vehicles
The tax credit for new qualified plug-in electric drive motor vehicles sold by General Motors, LLC, will begin to phase out April 1, 2019. The credit begins to phase out in the second calendar quarter...

2019 Foreign Housing Expense Limitations Released
The IRS has provided the adjustments to the limitation on foreign housing expenses for specific locations for tax year 2019. Generally, a qualified individual whose entire tax year is within the appli...

2018 Waivers of 911 Eligibility Requirements Due to Adverse Conditions
The IRS has provided a waiver for any individual who, for the 2018 tax year, failed to meet the eligibility requirements of Code Sec. 911(d)(1) due to war, civil unrest, or similar adverse c...

IRS Revises EIN Application Process
As part of its ongoing security review, the IRS is revising the application process for obtaining an employer identification number (EIN). Starting May 13, 2019, only individuals with social security ...

IRS Issues 2018 Nonconventional Source Fuel Reference Price
The IRS has published the nonconventional source fuel reference price for calendar year 2018. The credit period for the nonconventional source production credit under Code Sec. 45K ended on ...

AL - Cullman County increases local taxes
Effective May 1, 2019, Cullman County imposes a 0.5% local Alabama sales and use tax.New Sales And Use Tax RatesAs a result of the new tax, the rates for the following in Cullman County increase from ...

AK - Governor calls for constitutional amendments in sos address
In his first State of the State (SOS) address, Alaska Gov. Michael J. Dunleavy announced three constitutional amendments he plans to introduce. The amendments, which will be what he called "the f...

AZ - Seven-year period set for assessing tax after failure to file return
The Arizona Department of Revenue has seven years to assess the tax if a taxpayer fails to file a report or return for:income tax; orwithholding tax.Arizona enacted legislation creating this new limit...

AR - Delta music trail art project credit enacted
Arkansas has enacted a corporate and personal income tax credit for expenses related to art projects permanently installed along designated music highways in the state.Art Project RequirementsEligible...

CA - System error resulted in unverified wage withholding
The California Franchise Tax Board (FTB) informed personal income taxpayers that due to a system error that occurred during March 8, 2019, to March 11, 2019, the FTB issued refunds to taxpayers withou...

CO - Colorado amends residence retrofitting credit
Colorado legislation modifies the definition of a dependent for purposes of the credit for retrofitting a residence to increase accessibility. The legislation also changes additional provisions relate...

CT - Revision of forms for tobacco products manufacturers announced
The Connecticut Department of Revenue Services (DRS) has released an announcement publicizing the annual revision of the required tobacco tax forms that participating and nonparticipating tobacco prod...

DE - Taxpayers advised against overstating withholding amount
The Delaware Division of Revenue officials are noting an uptick in Delaware returns reporting overstated income tax withholding. Taxpayers must note that the appropriate amount to report is limited to...

DC - Proposed FY 2020 budget would include expansion of tax credit for homeowners and renters
For personal income tax purposes, the District of Columbia (DC) Office of the Mayor has issued a press release highlighting Mayor Muriel Bowser’s fiscal year 2020 budget proposal’s “...

FL - Classified use assessment post-hurricane Michael clarified
Florida clarifies classified use assessment post-Hurricane Michael for property tax purposes.Five-Year Recovery PeriodHurricane Michael caused significant damage to agriculturally-classified propertie...

GA - High-technology data center rule adopted
The Georgia DOR has adopted Rule 560-12-2-.117 ("High-Technology Data Center Equipment"). The rule provides guidance on the sales and use tax exemption for high-technology data centers in effect from ...

HI - New mandatory electronic filing announced
The Hawaii Department of Taxation has announced that fuel, liquor, and cigarette and tobacco tax returns for tax periods beginning on or after September 1, 2019 will be required to be filed electronic...

ID - Taxpayer owed tax because its purchase of goods from supplier was retail sale
A contractor (taxpayer) was properly issued a notice of deficiency determination (notice) proposing Idaho use tax, penalty and interest because the taxpayer’s purchase of goods from its supplier...

IL - Subtraction for dividends from taxable brokerage account not allowed
The Illinois Department of Revenue issued a general information letter stating that dividends from company stock held in a taxable brokerage account cannot be deducted from adjusted gross income on pe...

IN - Protest partially denied as assessments were properly issued in part
For personal income tax purposes, the Indiana Department of Revenue (department) timely issued assessments except for one of the tax years at issue. In this matter, the IRS conducted an audit of the t...

IA - Taxpayers in additional counties have deadline extended
Iowa has added an additional two counties, to the existing five, with extended income tax filing dates for residents affected by flooding. On April 16 two additional counties were added to the Preside...

KS - Publication for new businesses updated
The Kansas DOR has updated its sales and use tax publication for new businesses.Publication UpdateThe publication is updated to reflect that as of April 1, 2019, cereal malt beverage (CMB) permit hold...

KY - Checkoff for YMCA youth assembly program enacted
Effective for taxable years beginning on or after January 1, 2019, any taxpayer who is required to file a Kentucky personal income tax return and who is entitled to a refund for the overpayment of tax...

LA - Constitutional challenge to cap on solar tax credits rendered moot
The Louisiana Supreme Court held that a constitutional challenge to a cap on available solar electric system income tax credits was moot because the challenged statute was subsequently amended, and th...

ME - Senior volunteer benefit program subtraction increased
The Maine personal income tax subtraction modification for property tax benefits provided to volunteers age 60 or older under a municipal tax assistance program is increased from $750 to $1000. L.D. 6...

MD - Maryland issues guidance on treatment of global intangible low taxed income (GILTI)
Maryland has issued guidance on the reporting and taxation of IRC Sec. 951A global intangible low taxed income (GILTI), which is included in federal adjusted gross income. Because GILTI is not a divid...

MA - Draft guidance on cash method of accounting issued
Massachusetts issued draft guidance explaining the impact of the Tax Cuts and Jobs Act (TCJA) limits on the cash method of accounting for:corporate excise taxpayers;financial institution excise taxpay...

MI - Taxpayers warned about scammers attempting to collect past-due tax debts with fake letters
The Michigan Department of Treasury has issued a press release warning personal income taxpayers about a scam in which scammers attempt to collect past-due tax debts with fake letters. Taxpayers are s...

MN - Taxpayer’s appeal claiming wages not taxable denied
The Minnesota Tax Court has upheld additional personal income tax assessments for tax years 2014, 2015 and 2015 because the tax court found no merit in the taxpayer's argument that he was not subject ...

MS - Mississippi enacts jobs credit for inland water transportation enterprises
Mississippi has enacted a corporate income tax credit for certain water transportation enterprises that create eligible full-time jobs in the state.Credit AmountAny water transportation enterprise is ...

MO - Interest rate on refunds increased for third quarter of 2019
The interest rate on all qualifying Missouri tax refunds is increased from 1.7% to 1.9% for the period from July 1, 2019 through September 30, 2019. Statutory Interest Rates, Missouri Department ...

MT - Taxpayers may elect to directly deposit refund to education savings or able account
Taxpayers who are required to file a Montana personal income tax return may elect to directly deposit a refund from the return to a Montana family education savings program account, a Montana achievin...

NE - Relief for taxpayers affected by severe winter storm and flooding announced
The Nebraska Department of Revenue (department), following the Internal Revenue Service’s (IRS’s) granting of relief in the wake of the recent winter storm and flooding in the state, has a...

NV - Regulation establishing standards to determine whether overpayment of taxes was made intentionally or by reason of carelessness
The Nevada Tax Commission has issued a sales tax regulation establishing the standards to be used by the Department of Taxation to determine whether an overpayment of certain taxes was made intentiona...

NH - Senate passes legislation postponing BPT and bet rate reductions
The New Hampshire Senate passed legislation that would postpone future business profits tax (BPT) and business enterprise tax (BET) rate reductions. The existing rate reductions were enacted in 2017.B...

NJ - New Jersey issues IRC 163(j) limitation guidance
New Jersey has informed corporation business taxpayers that it does not require a modification to the overall calculation of the IRC Sec. 163(j) limitation or the income reported on line 28 for federa...

NM - New Mexico enacts a county compensating/use tax
New Mexico has enacted a county compensating tax that will replace several local taxes. The tax will be imposed on a person for the privilege of using:property;a license or franchise; andservices.The ...

NY - Taxpayer properly claimed empire state film production credit
For corporate and personal income tax purposes, a New York state taxpayer properly claimed empire state film production credit claim for the 2007 tax year. In this matter, the taxpayer filed a protest...

NC - IRC conformity updated
North Carolina enacted legislation that updates the IRC conformity date for computing corporate and personal income tax liability.IRC Conformity DateThe legislation changes the IRC conformity date fro...

ND - State enacts alternative simplified method for calculating research credit
North Dakota has enacted an elective alternative simplified method for calculating the research and experimental expenditure credit.Credit CalculationUnder the alternative simplified method, the credi...

OH - Trial court lacked subject matter jurisdiction to vacate tax liens
The Ohio Court of Appeals has held that the court of common pleas (trial court) did not err in determining that it lacked subject-matter jurisdiction to vacate the tax liens arising from unpaid school...

OK - Hospital program fee extended five years
Enacted Oklahoma legislation extends the sunset date of the supplemental hospital offset payment program fee. The state annually assesses each nonexempt, state-licensed hospital the fee based on the h...

OR - Deduction of loss from sale of property and rental activities allowed
For Oregon personal income tax purposes, taxpayers were entitled to deduct the loss from the sale of their property and suspended losses from their rental real estate activity because they converted t...

PA - Imposition of business privilege taxes upheld
For corporate income tax purposes, the Pennsylvania Commonwealth Court determined that the state law does not preempt a municipality from imposing a fee on businesses operating within its boundaries. ...

RI - CCF deductions beginning with returns filed for 2019 tax year disallowed
The Rhode Island Tax Division (division) in a ruling request clarified that it will disallow the Federal Capital Construction Fund (CCF) on personal income tax returns for the tax year 2019 forward bu...

SC - Applicability of sales and admissions tax to brewery tours discussed
The South Carolina Department of Revenue issued a revenue ruling regarding the applicability of sales and admissions tax to tours and samples offered by breweries. In determining whether a sales or ad...

SD - Maximum school district levies revised
For South Dakota property taxes payable in 2020 and each year thereafter, the maximum school district levies have been amended.Maximum Levy for General School District FundThe maximum levies for the g...

TN - Classification of business as seller of glass affirmed
The trial court did not err in determining that the taxpayer should be classified under Classification 1(B) for Tennessee business tax purposes because the majority of gross sales for the taxpayer wer...

TX - Apportionment of receipts from sales of products determined
The Texas Comptroller ruled on how to apportion receipts from sales of products delivered within and outside of Texas.Combined GroupsThe taxpayer is a Texas-based wholesale and distribution business. ...

UT - Utah expands corporate income tax nexus standard
Utah legislation expands the state’s "doing business" standard for corporate income tax purposes. The legislation is operative for tax years beginning on or after January 1, 2019.The s...

VT - Property not overvalued; disproportionate assessment not shown
For Vermont property tax purposes, the superior court did not err in establishing the fair market value of the taxpayer’s property based on the recent sale of the property because the taxpayers ...

VA - Litter tax due May 1, 2019
The Virginia Department of Taxation informs manufacturers, wholesalers, distributors, or retailers of the following products that they are required to pay the litter tax by May 1,2019: food for human ...

WA - Annual filing date revised
The Washington due date for annual filers of the business and occupation (B&O) tax has been extended.Annual Filing Due DateThe B&O tax due date for annual filers has been extended from January...

WV - Pension benefit guaranty deduction restored
West Virginia restored a personal income tax deduction for retirement income received under a defined plan covered by the Pension Benefit Guaranty Corporation (PBGC). The original deduction ended on J...

WI - Guidance on pass-through withholding and composite return updated
For corporate income tax purposes, the Wisconsin Department of Revenue updated its fact sheet providing guidance on pass-through withholding and composite returns. The fact sheet provides a general ov...

WY - Provisions relating to tax liens on mineral production revised
Provisions on tax liens relating to Wyoming property taxes imposed on mineral production have been amended.Mineral Production LiensFor any lien related to mineral production on or after January 1, 202...