SALT TALK: NYS Guidance Clarifies Penalty and Interest Relief for Late Payment of Sales Tax Due March 20th

Posted by Richard Goldstein, J.D. on Mar 23, 2020 4:22:05 PM

The New York State Department of Taxation & Finance has issued guidance clarifying penalty and interest relief for late payment of sales tax due on March 20. Certain taxpayers are not eligible for relief, including the following:

  • Sales Tax Vendors who are required to file returns on a monthly basis, and
  • Participants in the Promptax program for sales and use tax or prepaid sales tax on fuel.

Additionally, relief is not automatic and will be granted on a case by case basis. The Governor issued an executive order expanding the Tax Commissioner’s authority to abate late filing and payment penalties to also allow the Commissioner to abate interest on quarterly sales and use tax filings and remittances with a due date of March 20, 2020 for those who were unable to timely file and pay as result of the COVID-19 virus, such as:

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SALT TALK: Governor Cuomo’s Press Conference Leads to More Questions regarding NYS Tax Deadline

Posted by Wayne K. Berkowitz CPA, J.D., LL.M. on Mar 20, 2020 3:15:45 PM

During Governor Andrew Cuomo’s press conference today, in response to a question from a reporter regarding whether New York State was going to have a new tax deadline, the Governor responded, “The new deadline is the federal deadline.”

The Governor immediately handed off to the State Budget Director Robert Mujica, who confirmed that since the New York deadline is tied to the federal deadline, New York’s deadlines will be extended as well.

When asked about the sales tax deadline, Mr. Mujica responded that “we are going to forgive interest and penalties related to the sales tax.” When asked if the sales tax deadline was being pushed back, Mr. Mujica responded “the deadline stays the same. But there is no interest or penalties for those who can’t pay.” The Budget Director’s comments expressly addressed sales tax. His statement also appeared to cover business and personal income taxes, but we await official clarification on this. 

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SALT TALK: Is Wayfair a Pandemic?

Posted by Wayne K. Berkowitz CPA, J.D., LL.M. on Mar 9, 2020 11:40:00 AM

Riding the commuter rails this morning, it certainly felt like one of those holiday Mondays where everyone else has the day off and you still head to work. After taking a quick mental inventory of holidays past and future, I realized this was just any other day. Or so I thought.

Did I hear NYC’s very own Mayor de Blasio tell me to walk to work and not take the subway if this was in fact an option. I was sure to heed his advice and take the twenty-minute walk from Penn Station to my office. Although riding the LIRR, it appears others took it one step further and didn’t travel to work at all.

According to CNN, which today began calling the coronavirus outbreak a pandemic, the criteria for what qualifies is not universally defined. Apparently even the World Health Organization doesn’t agree on a definition. But turning to Wikipedia, we find that “a pandemic is an epidemic occurring on a scale which crosses international boundaries, usually affecting a large number of people.”

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SALT TALK: Live the Life You Choose

Posted by Wayne K. Berkowitz CPA, J.D., LL.M. on Mar 2, 2020 3:45:00 PM

Can’t you hear the jingle playing with the singers belting out the lyrics, “Berdon LLP, Accountants and Advisors, call #########.

I expect to hear this retort over and over this week as our new Berdon radio campaign hits the airwaves today. Friends, family, colleagues, acquaintances and others just can’t resist a good-natured tease. My phone will be ringing with old familiar voices looking for a good laugh and maybe even to reconnect.

We are going to be running a rotating series of tax tips focused on planning to help you “live the life you want to lead.” One of these tips will be offered by me and of course will deal with state and local tax, specifically the perils of being found a tax resident of multiple states.

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SALT TALK: Permanent Place of Abode: Taking Ownership

Posted by Wayne K. Berkowitz CPA, J.D., LL.M. on Feb 24, 2020 11:40:00 AM

We have always been told it’s important to take ownership of your work, your actions, and sometimes even the actions of others. However, when it comes to determining whether you have a permanent place of abode (PPA), ownership just doesn’t matter.

Countless times, I have been asked by clients and potential clients whether they should buy, lease, rent, etc. a home, condominium, or cooperative in their own name, their spouse’s name, a relative’s name, in a business entity, or any other permutation. While there may be other important reasons to evaluate this decision, determining whether one has a PPA just isn’t one of them.

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SALT TALK: Sales Tax on Capital Improvements – Are You Secure?

Posted by Wayne K. Berkowitz CPA, J.D., LL.M. on Feb 18, 2020 11:40:00 AM

While we all know that most jurisdictions have a “carve-out” from the sales tax for capital improvements, often-times mandated services related to such improvements can tag along for the exemption.

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SALT TALK: NYS Ends Sales Tax on Beer Flights in Anticipation of Proposed Gross Receipts Tax on Data

Posted by Wayne K. Berkowitz CPA, J.D., LL.M. on Feb 10, 2020 11:40:00 AM

We are all going to need a drink after this.  So, in the spirit of helping New Yorkers determine their favorite fermented beverage, Governor Cuomo signed into law a measure exempting certain beer tastings from New York State Sales Tax.  If you consume a beer tasting of not more than five different samples, each being five ounces or less, no tax applies. Such samplings are commonly referred to as “beer flights”.

The liquor laws in virtually every state tend to be unique, complicated, and arcane.  I’ll never forget my first visit to a brewery about fifteen years ago.  It was in Saratoga, New York and the rules were so outdated that the brewery wasn’t even allowed to charge for a tasting, let alone tax it.  Not wanting to be one of the many moochers in the room there for the free beer, I bought a growler full of my favorite brew.  I sat down at my table and proceeded to open the growler.  Next thing I knew, the “mature” woman behind the bar literally jumped over the mahogany top and took a dive on top of me and my open growler.  Here I was trying to support the brewery and show up the freeloaders.  How was I supposed to know you were only allowed to drink the free beer in the tasting room and not the beer you paid for.

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SALT TALK: Telecommuting May Result in Inconvenient Truths

Posted by Wayne K. Berkowitz CPA, J.D., LL.M. on Feb 3, 2020 12:30:00 PM

You’re trying to do your share to stop global warming, so you persuade your employer to let you work from home. Think of the gas you will save, and the burden lifted from the environment. Well, not so fast, if you live in one of the few states with a so-called “Convenience of the Employer” rule. You are going to be so mad when you realize the consequences that the steam rising from the top of your head is going to create more environmental damage than any reduction in carbon output from working at home.

Delaware, Nebraska, New York, Pennsylvania and Connecticut all have a “convenience rule.”  However, Connecticut will only apply its rule if the nonresident taxpayer in question lives in a jurisdiction that has its own version of the rule.

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SALT TALK: They Call It Instant Justice - Sales Tax on Protective and Detective Services Clarified

Posted by Wayne K. Berkowitz CPA, J.D., LL.M. on Jan 27, 2020 12:00:00 PM

For those of you watching the detectives or the receptionists, we have some good news:  A New York State Tax Appeals Tribunal decision[1] provides some clarity and reason.

New York State subjects protective and detective services to sales tax.   The problem has been that there is no definition in the Tax Law as to what these services actually constitute and the Tax Department’s view has been broadening over the years.  One 2011 Advisory Opinion goes as far as to say that lifeguard services constitute protective services and are subject to sales tax.

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SALT TALK: Lose a Lawsuit, Pass a Law: NJ Pass-Through Entity Tax a Reality

Posted by Wayne K. Berkowitz CPA, J.D., LL.M. on Jan 21, 2020 11:40:00 AM

Congress and the President made the first move capping the deduction for state and local taxes (SALT) at a mere $10,000. States were quick to fire back by dreaming up all sorts of alternative schemes to work around the limitation. Some of these included the recharacterization of certain tax obligations, such as property taxes, to charitable contributions. While many of these transformative schemes were questionable from the beginning, the IRS made their move this summer by finalizing regulations effectively stunting most of the SALT workaround strategies.

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