Two state tax issues which surfaced over the past weekend are affecting many practitioners and taxpayers.
1. Many taxpayers are receiving notices for 2009 from the Louisiana Department of Revenue (LDR). According to David Stokes, LDR Tax Practitioner Liaison, the LDR is using a new match-up program of federal and state tax data, but the LDR’s computer system inadvertently triggered the notices. Practitioners, on behalf of their clients, should send the account number and/or letter ID to Mr. Stokes, firstname.lastname@example.org, and he will submit to the appropriate team for resolution.
2. In our Jan. 15 Tax Alert, and in the January Tax Topics blog on the LDR website, it was reported that LDR would follow the Internal Revenue Service lead and provide penalty relief to some taxpayers due to the delay in releasing tax forms and processing for the 2013 tax filing season. Included were:
Exception to Estimated Payment Declaration Requirement,with LDR extending the January 31 deadline for the 2012 tax year to February 15, 2013. Under normal circumstances, if the taxpayer files their income tax return and pays the tax in full on or before January 31, there is no Underpayment of Estimated Tax (UET) Penalty on the estimated payment due January 15.
Exception to Estimated Payment Declaration Requirement for farmers and fishermen, with LDR extending the March 1 deadline to April 15, 2013. Under normal circumstances, if the qualifying farmer or fisherman files their income tax return and pays the tax in full on or before March 1, there is no Underpayment of Estimated Tax (UET) Penalty. However, some schedules used by farmers and fishermen were not ready prior to March 1.
According to David Stokes, the appropriate LDR departments were apparently unaware that the LDR was piggybacking on the tax relief provided by IRS and, as a result of that miscommunication, some penalty notices were mailed that should not have been.Practitioners should send the account number for the affected taxpayers to Mr. Stokes, email@example.com, and he will process accordingly. The accounts will be reviewed and, if all tax was paid timely, the UET Penalty will be removed and a Liability Cancellation letter will be sent.