E-filing state tax returns.Most states participate in the Federal/state electronic filing (e-file For US IRS electronic tax filing, see . EFILE is the system used by the Canada Revenue Agency as a means for electronically transmitting tax returns. EFILE is only available to professional tax prepares and is not to be confused with the publicly available NETFILE. ) program, which allows individual taxpayers to file their Federal and state income tax returns at the same time. Even if a state does not participate, return preparation software makes it relatively easy to integrate e-filing Filing income tax and other governmental forms online. of state returns with the Federal process. All states that impose a personal income tax now accept e-filed individual income tax returns, although not all of them accept nonresident non·res·i·dent adj. 1. Not living in a particular place: nonresident students who commute to classes. 2. or part-year resident returns. Individual returns with balances due may be e-filed in all states; all refunds may be directly deposited into a taxpayer's bank account. A firm must. apply to the IRS An abbreviation for the Internal Revenue Service, a federal agency charged with the responsibility of administering and enforcing internal revenue laws. to be an electronic return originator Originator A bank, savings and loan, or mortgage banker that initially made a mortgage loan that is part of a pool. Also, an investment bank that has worked with the issuer of a new securities offering from the beginning and is usually appointed manager of the underwriting (ERO ERO European Radiocommunications Office ERO Education Review Office (New Zealand) ERO Explicit Route Object (protocol) ERO Eastern Regional Office ERO Electronic Return Originator ), using Form 8633, Application to Participate in the IRS e-file Program. The application process may be completed at the IRS website, www.irs.gov/efile. Once a firm is accepted as an ERO by the IRS, most states will automatically accept it as a state ERO. If a firm is located outside of a state, this may not apply. The exhibit on p. 767 shows which states follow the Federal process, which have their own rules, which accept nonresident and part-year resident returns and how they complete the signature process. Detailed information can be found at each state's website. State Mandates While most states do not require e-filing of income tax returns, some do. Many states require e-filing for and/or and/or conj. Used to indicate that either or both of the items connected by it are involved. Usage Note: And/or is widely used in legal and business writing. payment of sales and use, payroll and excise taxes excise taxes, governmental levies on specific goods produced and consumed inside a country. They differ from tariffs, which usually apply only to foreign-made goods, and from sales taxes, which typically apply to all commodities other than those specifically exempted. ; this column focuses only on income tax returns. The following states have e-filing mandates with their own rules. Alabama Alabama, indigenous people of North America Alabama (ăləbăm`ə), indigenous people of North America whose language belongs to the Muskogean branch of the Hokan-Siouan linguistic stock (see Native American languages). : Practitioners who prepare 250 or more individual income tax returns during 2004 must e-file all acceptable current-year individual returns. The requirement decreases to 100 returns filed in 2005. Taxpayers may elect not to e-file their returns; see the Department of Revenue (DOR Dor or Dora, Canaanite seaport, ancient Palestine (modern Israel), N of Caesarea Palestinae. It was never a Jewish city but rather a Phoenician outpost. It was rebuilt by the Romans; still visible are the ruins of a temple and a theater. ) website, at www.ador.state.al.us/incometax/elfmandtate.html, for more information. California California (kăl'ĭfôr`nyə), most populous state in the United States, located in the Far West; bordered by Oregon (N), Nevada and, across the Colorado River, Arizona (E), Mexico (S), and the Pacific Ocean (W). : Tax practitioners who prepare more than 100 individual state income tax returns per year must e-file those returns. Failure to comply may result in a $50 penalty per noncompliant return. The penalty may be waived for reasonable cause, which includes the taxpayer's decision not to e-file the return. More information is available at the Franchise Tax Board website, at www.ftb.ca.gov See .gov and GovNet. (networking) gov - The top-level domain for US government bodies. . Connecticut Connecticut, state, United States Connecticut (kənĕt`ĭkət), southernmost of the New England states of the NE United States. It is bordered by Massachusetts (N), Rhode Island (E), Long Island Sound (S), and New York (W). : A pending regulation will require preparers who prepare 200 or more 2004 individual income tax returns to e-file 2005 individual returns. The regulation is scheduled to go into effect on Jan. 1, 2006. Practitioners are urged to "test drive" electronic filing 2004 returns in 2005 to prepare for the 2006 mandatory filing requirement; see www.ct.gov/drs/search/search.asp?qu=2004+and+regulation&go.x=9&go.y=4. Massachusetts Massachusetts (măsəch  `sĭts), most populous of the New England states of the NE United States. : As of Sept. 1, 2003, new business entities must file
and pay all taxes electronically. Beginning in 2005, corporations,
partnerships and fiduciaries meeting certain thresholds will have to
file and pay their taxes electronically. For tax years beginning after
2003, tax preparers who completed 200 or more state personal income tax
returns during the previous calendar year are required to file
electronically (unless the taxpayer requests paper filing). Detailed
information on Massachusetts e-filing mandates can be found in Technical
Information Release 04-30, available at
www.dor.state.ma.us/rul_reg/tir/TIR._04_30/htm.Michigan Michigan (mĭsh`ĭgən), upper midwestern state of the United States. It consists of two peninsulas thrusting into the Great Lakes and has borders with Ohio and Indiana (S), Wisconsin (W), and the Canadian province of Ontario (N,E). : Practitioners who prepare 200 or more individual income tax returns must e-file all eligible individual returns. All single business tax returns must be e-filed if computer software is used to prepare them. More information is available at the Department of Treasury website, at www.michigan.soy/treasury. Minnesota Minnesota, state, United States Minnesota (mĭn'ĭsō`tə), upper midwestern state of the United States. It is bordered by Lake Superior and Wisconsin (E), Iowa (S), South Dakota and North Dakota (W), and the Canadian provinces : Personal income tax returns must be e-filed by businesses that prepared more than 100 such returns in the previous year. Returns eligible for e-filing may be submitted on paper for a $5 "fee," even if the taxpayer indicates that it does not want to e-file the return. Additional information is on the DOR website, at www.taxes.state.mn.ns. New Jersey: All practitioners who prepared 200 or more 2003 New Jersey individual resident income tax returns must e-file 2004 resident income tax returns. Taxpayers can decline to have their returns e-filed by signing an opt-out To cancel some situation or condition. See opt-in. form to be released in January January: see month. 2005. The Division of Taxation plans to pursue legislation enacting preparer penalties for noncompliance noncompliance failure of the owner to follow instructions, particularly in administering medication as prescribed; a cause of a less than expected response to treatment. noncompliance . New Jersey partnership returns with 10 or more partners must be e-filed. More information is available at the Division of Taxation website, at www.state.nj.us/treasury/taxation. Oklahoma Oklahoma (ōkləhō`mə), state in SW United States. It is bordered by Missouri and Arkansas (E); Texas, partially across the Red R. (S, W); New Mexico, across the narrow edge of the Oklahoma Panhandle (W); and Colorado and Kansas (N). : Any tax return preparer who prepared more than 50 Oklahoma individual income tax returns for the prior year, must e-file all such returns for the current tax year. This does not apply to taxpayers who do not want their returns e-filed. More information is available at the Tax Commission website, at www.oktax.state.ok.us. Virginia Virginia, state, United States Virginia, state of the south-central United States. It is bordered by the Atlantic Ocean (E), North Carolina and Tennessee (S), Kentucky and West Virginia (W), and Maryland and the District of Columbia (N and NE). : Effective for 2004 returns to be filed in 2005, practitioners who prepared 200 or more 2003 Virginia individual income tax returns must e-file all such 2004 returns (or use software with 2D barcodes For the machine-readable representation of information in a visual format on a surface see barcode. For the British Blues Jazz group see The Barcodes ). Taxpayers may decline to e-file their returns by completing Form 8454T, Virginia Department of Taxation, Taxpayer Filing Election Opt Out Form, which requires a reason. Detailed information is available on the Department of Taxation website, at www.tax.state.va.us. Wisconsin Wisconsin, state, United States Wisconsin (wĭskŏn`sən, –sĭn), upper midwestern state of the United States. It is bounded by Lake Superior and the Upper Peninsula of Michigan, from which it is divided by the Menominee : Practitioners who prepared 100 or more Wisconsin individual income tax returns in a prior year have to e-file individual income tax returns. This does not apply to taxpayers who wish to file a paper return. The DOR website, at www.dor.state.wi.us, contains more information. Benefits and Burdens E-filing state returns eliminates error notices from state authorities caused by data entry errors, provides confirmation that returns have been received and allows taxpayers receiving refunds to get them sooner. Practitioners will incur To become subject to and liable for; to have liabilities imposed by act or operation of law. Expenses are incurred, for example, when the legal obligation to pay them arises. An individual incurs a liability when a money judgment is rendered against him or her by a court. additional time when starting the state e-file process, as they ensure compliance with each state's registration requirements. Some multiple state returns cannot be filed electronically, which disappoints practitioners as well as taxpayers; a Federal/state Form 1120 e-file program, for example, is not expected to be implemented until at least 2006. Resources The IRS e-file webpage, at www.irs.gov/efile, provides vast information on Federal and state e-filing, including contact information for all of the state's e-filing coordinators. Every state's taxing authority maintains a website with valuable information. The Federation of Tax Administrators website, at www.taxadmin.org/fta, collects and disseminates information about e-filing from the states. The return preparation software company a firm uses or intends to use is an excellent resource for each firm's particular situation. Editor's note Editor's Note (foaled in 1993 in Kentucky) is an American thoroughbred Stallion racehorse. He was sired by 1992 U.S. Champion 2 YO Colt Forty Niner, who in turn was a son of Champion sire Mr. Prospector and out of the mare, Beware Of The Cat. Trained by D. : Mr. Holub is the former chair of the AICPA AICPA See American Institute of Certified Public Accountants (AICPA). Tax Division's Tax Practice Management Committee. Mr. Muirhead is the Chair of the AICPA Tax Division's Tax Practice Improvement Committee. Ms. Rosenberg Rosenberg (rō`zənbərg), city (1990 pop. 20,183), Fort Bend co., S Tex., on the Brazos River, in an oil and natural gas area; inc. 1902. Rosenberg and its sister city of Richmond are physically one community. is a member of that Committee's E-File Task Force. She thanks Lisa Szargowicz and the E-File Task Force for their valuable assistance.
Exhibit: State e-filing of individual returns
Federal/state
State program? Application process
Alabama Yes Automatic when accepted by IRS
Alaska No tax
Arizona Yes Automatic when accepted by IRS
Arkansas Yes Automatic when accepted by IRS
California No State has own form
Colorado Yes Automatic when accepted by IRS
Connecticut Yes Automatic when accepted by IRS
Delaware Yes Automatic when accepted by IRS
District of Columbia Yes Automatic when accepted by IRS
Florida No tax
Georgia Yes Automatic when accepted by IRS
Hawaii Yes Automatic when accepted by IRS
Idaho Yes Automatic when accepted by IRS
Illinois Yes State has own form
Indiana Yes Automatic when accepted by IRS
Iowa Yes Automatic when accepted by IRS
Kansas Yes Automatic when accepted by IRS
Kentucky Yes Automatic when accepted by IRS
Louisiana Yes Send IRS application/approval
Maine No Automatic when accepted by IRS
Maryland Yes Automatic when accepted by IRS
Massachusetts No State has own form
Michigan Yes Automatic when accepted by IRS
Minnesota No Automatic when accepted by IRS
Mississippi Yes Automatic when accepted by IRS
Missouri Yes Automatic when accepted by IRS
Montana Yes Automatic when accepted by IRS
Nebraska Yes Automatic when accepted by IRS
Nevada No tax
New Hampshire No tax
New Jersey Yes Automatic when accepted by IRS
New Mexico Yes Automatic when accepted by IRS
New York Yes State has own form
North Carolina Yes Automatic when accepted by IRS
North Dakota Yes State has own form
Ohio Yes Automatic when accepted by IRS
Oklahoma Yes Automatic when accepted by IRS
Oregon Yes Automatic when accepted by IRS
Pennsylvania Yes Send IRS application/approval
Rhode Island Yes Automatic when accepted by IRS
South Carolina Yes Automatic when accepted by IRS
South Dakota No tax
Tennessee No tax
Texas No tax
Utah Yes Send IRS application/approval
Vermont Yes Automatic when accepted by IRS
Virginia Yes Automatic when accepted by IRS
Washington No tax
West Virginia Yes Send IRS application/approval
Wisconsin Yes Send IRS application/approval
Wyoming No tax
Nonresident and Signature
State part-year returns? document
Nonresident Part-year
Alabama No No ERO keeps
Alaska
Arizona Yes Yes Mail
Arkansas Yes Yes ERO keeps
California Yes Yes ERO keeps
Colorado Yes Yes ERO keeps
Connecticut No No ERO keeps
Delaware Yes Yes ERO keeps
District of Columbia N/A No ERO keeps
Florida
Georgia Yes Yes ERO keeps
Hawaii No No N/A
Idaho Yes Yes N/A
Illinois Yes Yes ERO keeps
Indiana No No ERO keeps
Iowa Yes Yes ERO keeps
Kansas Yes Yes N/A
Kentucky No No ERO keeps
Louisiana No No ERO keeps
Maine Yes Yes ERO keeps
Maryland Yes Yes ERO keeps
Massachusetts Yes No Mail
Michigan Yes Yes N/A
Minnesota Yes Yes N/A
Mississippi Yes Yes ERO keeps
Missouri Yes Yes ERO keeps
Montana No Yes N/A
Nebraska Yes Yes ERO keeps
Nevada
New Hampshire
New Jersey No No Mail
New Mexico No No ERO keeps
New York Yes Yes Mail or personal
idenitification
number (PIN)
North Carolina Yes Yes N/A
North Dakota Yes Yes ERO keeps
Ohio Yes Yes ERO keeps
Oklahoma No No ERO keeps
Oregon Yes Yes Federal PIN
Pennsylvania Yes Yes ERO keeps
Rhode Island No No ERO keeps
South Carolina Yes Yes ERO keeps
South Dakota
Tennessee
Texas
Utah Yes Yes Federal PIN
Vermont Yes Yes ERO keeps
Virginia Yes Yes ERO keeps
Washington
West Virginia No No ERO keeps
Wisconsin No No N/A
Wyoming
For more information about this column, contact Mr. Holub at (813) 222-8555 or stevenh@apcpa.com, or Ms. Rosenberg at (301) 738-9040 or susanr@slrcpas.com. Co-Editors: Steven Ste´ven n. 1. Voice; speech; language. Ye have as merry a steven As any angel hath that is in heaven. - Chaucer. 2. An outcry; a loud call; a clamor. To set steven to make an appointment. F. Holub, CPA (Computer Press Association, Landing, NJ) An earlier membership organization founded in 1983 that promoted excellence in computer journalism. Its annual awards honored outstanding examples in print, broadcast and electronic media. The CPA disbanded in 2000. Aidman aid·man n. A member of an army medical corps attached to a field unit. , Piser & Co. Tampa Tampa (tăm`pə), city (1990 pop. 280,015), seat of Hillsborough co., W Fla., a port of entry with an impressive harbor on Tampa Bay; inc. 1855. , FL T. Chris Muirhead, CPA Porter, Muirhead, Cornia & Howard Casper, WY Author: Susan J. Rosenberg, CPA Saggar, Lippman & Rosenberg, PC Rockville, MD |
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