New IRS app available for making payments and checking refund status
The IRS recently released an app that allows taxpayers to make tax payments and check their refund status on their smartphones. You can learn more about the app in this YouTube video, or click here for more information from the IRS site.
IRS Announces New Payroll Tax Compliance Initiative
In an effort to combat delinquent payroll tax deposits, the IRS is launching an Early Interaction Initiative. This Initiative will alert the IRS if an employer’s payroll tax deposits have declined. When they do, the employer will receive a letter from the IRS requiring the employer to contact them to help them understand why the deposits have decreased. This could be a hassle for employers that simply decrease staffing, but in the alternative it could alert an employer that there are tax payment issues they may not be aware of.
If an employer has a history of delinquent payroll tax deposits, these alerts will be routed to Field Collections for more direct attention.
More can be read here.
Changes In Due Dates of Tax Returns For The 2016 Tax Year
Congress recently passed a bill that changes the due dates of certain tax returns effective with the 2016 tax year (returns due in 2017).
The individual tax return deadline remains unchanged at April 15, but returns for corporations, partnerships, trusts, estates, benefit plans and FinCEN reporting all experience some changes. The new due dates will make the filing deadlines more consistent and will allow longer extensions in some cases. A table of the changes can be read here and the language of the bill can be read here.
Back-To-School Sales Tax Holiday for Ohio Announced
Ohio has passed a sales tax holiday for Friday August 7th through Sunday August 9th. Retailers are not required to collect sales tax on applicable items during this holiday, including school supplies and certain articles of clothing. For more information, please read the FAQ here.
Ohio BWC Mails First Notices of Estimated Premiums
Ohio BWC’s transition to prospective billing has reached the implementation stage. The first round of Notices of Estimated Premiums arrived in the mail over the past week, informing us of the premiums employers will be required to pay for the coming year. The first actual invoice to pay will arrive in early August with the first payment due August 31. In July 2016, employers will file a true-up report, reconciling actual payroll paid with the estimates provided by BWC, with overages and shortages resulting in credits to the account or balances due. If the amounts estimated by BWC appear significantly different than what an employer expects to actually incur, a call to the Bureau is required to make any adjustments. More information is available here.
Recent Supreme Court Ruling May Impact Ohio Local Taxes
The U.S. Supreme Court recently ruled on a Maryland case involving the state’s credit for taxes paid to other states. Maryland has two levels of tax on resident income; the usual state income tax and a county tax that is also levied on non-residents on the portion of their income earned in Maryland. This county tax caused income to be taxed twice at that level, something prohibited by the dormant Commerce Clause because it discriminates against interstate commerce.
This is something like what Ohio residents face with our local tax system. Many cities offer only partial credit for taxes paid to cities where the income is earned, others offer no credit at all, resulting in double tax on the same income. Local tax structures in Pennsylvania, Indiana and New York may also be impacted by this ruling. We will watch for developments in this area and post updates as they arise.
