LCPA members noted that they are getting messages indicating Louisiana returns e-filed are being delayed in processing. Kent LaPlace with LDR indicated there is a backlog of e-filed returns, and they expected the delay to be cleared up in a day or so. The IRS is experiencing technical issues also due to the high MF volume.
Forms 1099G and Citizens Refunds
LCPA members indicated Form 1099Gs are being issued by LDR including Citizens refund amounts besides amounts from withholding and estimated tax payments. LDR indicated its position on this subject is covered in Revenue Information Bulletin 08-011 (Corporation and Individual Income Tax-The Nature of State Tax Credit Refunds).
$100 Penalty Notices on LLC Entities
LCPA members indicated clients are receiving penalty notices for franchise tax for entities which are exempt from Louisiana franchise tax. LDR indicated it could be from not checking the appropriate box when registering for a tax account on the LDR web site. Also note that bills for Corporation Income Tax will say "Corporation Income and Franchise Tax”, because LDR’s tax system only has one account for both of these taxes. The bill, therefore, may not be for franchise tax, but for failure to file a corporation income tax return. Please see the LDR Memorandum – "Business tax accounts must be closed to avoid non-filing assessments” issued February 20, 2013.
LDR also indicated businesses can revise/update their corporation information on the LDR website to reflect the correct entity status.
E-Filing of Business Returns and PDF Attachments
LCPA members indicated there were issues with the filing of pdf attachments on business returns using Lacerte. LDR indicated they would contact Lacerte and work on this.
In the past R-6466 was used to request an extension to file the Partnership Return or the Fiduciary Tax Return. For the 2012 tax year forward, R-6466 will be used for the Fiduciary Tax Return only, and R-6463 will be used for the Partnership Return. The R-6463 is a new form. R-6467S will still be used for the Composite Partnership Return. Until the Fiduciary Tax Return and the Partnership Return become automated, the federal extension will also continue to be accepted.
2012 Withholding Tax Penalties
LDR legislatively changed the Withholding reporting process whereby every entity is required to submit a withholding tax return each quarter (LSA R.S. 47:114). LDR no longer creates a return when a payment is submitted electronically. It appears some taxpayers were still confused about this and have not filed these quarterly returns.
LDR sent out a letter to those taxpayers (dated Feb 5, 2013) reminding them about this. Now when the taxpayer goes into their LaTap account and generates the quarterly returns, their LaTap account calculates a penalty. Taxpayers are calling members about these penalties since they feel the new process was very confusing, and even though they paid their taxes on time, they are being penalized for not generating the quarterly return.
During our conference call, LDR stated that they will remove the 1st and 2nd quarter 2012 penalties. To ask for the removal of the 1st and 2nd quarter penalties, LDR said to go on to the LDR website, click Contact Us, Business tax, Business notice received, fill out the required fields and submit a message requesting the removal of late filing penalties for 1st and 2nd quarter of 2012.
Regulation LAC 61:I.1515 became effective 9/21/2012; therefore, the 3rd and 4th quarter penalties cannot be removed by the same process. For the 3rd and 4th quarters, taxpayers will need to file Form R-20128 (Request for Waiver of Penalties). In the request, you should indicate the client paid all amounts on time, have always filed timely in the past, the new procedures and process were extremely confusing, and they filed the reports as soon as they were informed they were delinquent. Any consideration of the waiver of penalties assessed for the 3rd and 4th quarters would be under the provisions of R.S. 47:1603.
Some members have indicated the online procedures are not working. Please wait for further instructions. Requesting the removal of the 1st and 2nd quarters on the R-20128 will delay the process and involve the BTA if the amount is over $5,000.
Federal Transcripts for Louisiana Amended Returns
LDR is requiring a Federal transcript to be filed with Louisiana amended individual returns when the adjustments involve a federal audit adjustment that increased the AGI that was later reduced.