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Completely Compliance- Across the Country

by DMA Staff | Jan 04, 2018
DMA_CCAcrossAmerica
Looking Back
Arizona: Throughout the next few years, Arizona will move to mandatory eFile/ePay. Effective January 1, 2018, all businesses with TPT liability of $20,000 or more in the prior year will be required to eFile and ePay. This reduces to $10,000 on 1/1/19, $5,000 beginning 1/1/20 and $500 beginning 1/1/21. The bill also includes changes in the audit process and penalty assigned.

Colorado: Originally considered back in 2010, the Centennial State has joined other noted states in requiring use tax notification from retailers with at least $100,000 in sales to Colorado customers annually and do not collect sales tax. Specifications on the notification can be found on Rule 39-21-112 (3.5).

Kansas: Filing frequency thresholds are increasing now thanks to HB 2212. The new amounts are effective January 1, 2018.

Louisiana: On June 14, Governor Edwards signed bill 307, becoming Act 211. The bill required a tax clearance issued by the Department of Revenue before the Department will issue or renew a resale certificate. It was effective October 1, 2017.

New Jersey: In addition to the MTC disclosure program, the state of New Jersey will also conduct their own VDA program. The Division of Taxation will waive late filing and payment penalties, but will impose a 5% penalty for not taking advantage of the amnesty program offered back in 2009.

North Carolina: SB 81 would create an economic nexus for remote sales in the state. The thresholds are $100,000 in North Carolina sales in the previous year or 200 or more separate transactions. The bill passed the Senate on June 13, and there was a first reading in the House two days later. However, there has been no movement on the bill since. UPDATE: As of December 20, there is still no movement of this bill and can be presumed dead.

Rhode Island: Per HB 5175, the state will implement economic nexus for remote sellers and marketplace providers whose gross revenue equals or exceeds $100,000 for electronically delivered products and services or 200 separate transactions from the preceding calendar year . If the seller does not register for a permit, then use tax notification requirements apply. The new requirements are effective January 1, 2018.

Also in Rhode Island, effective July 1, 2017, the state issued new account numbers for account holders. The new numbers are an effort to increase security and efficiency within the department and allow quicker processing of payments, particularly for multiple location businesses.

Tennessee: In order to maintain compliance with the SSUTA, the state established several changes that were to take effect July 1, 2017. However, it was announced that these changes will be postponed until July 1, 2019. Some of the significant changes include sourcing to shipping destination, multiple location filing and changes to the single article tax. UPDATE: The postponement should only apply to SST returns filed with the state of Tennessee. For companies making deliveries into the state and have a permanent location in Tennessee, the delivery location requirement on Schedule B will be effective January 1, 2018. The option to select the “override box” while online filing will no longer be available.

Hartford, Vermont: Among a list of other local jurisdictions, the city of Harford, Vermont enacted a Local Option Meals and Rooms Tax of 1%. The new tax was effective October 1, 2017 and is administered by the state. Tax collected should be reported on the Form MRT-441.

Seattle, Washington: On a steady increase, the rates and fees for the City’s Business and Occupation Tax (B&O) and Business License Tax Certificate Fee are making their final change in a three-year process. Effective January 1, 2018, the B&O rate for all classifications except service and freight increases to 0.00222%. Service and freight raise to 0.00427%. Review this link for the new applicable license renewal fees.

Looking Forward
Kodiak, Alaska: The city council, per Ordinance 1367, has increased the maximum taxable sale from $750 to $3,000 effective January 1, 2018. All single item sales above $3,000 will be exempt from sales tax in the city.

Arizona: Effective January 1, 2018, property management companies can file their TPT tax via AZtaxes.gov. The new system will offer bulk filing uploads and should simplify the filing process for these companies.

Arkansas: The state has released notification of Act 141 which redefines candy, soft drinks and digital products, effective January 1, 2018. Candy and soft drinks are redefined so that they are no longer under the umbrella of food and food ingredients. Therefore, the full 6.5% state rate will apply instead of the reduced food rate of 1.5%. In addition to this, the Act further defines digital goods to include the full state, county and city rates applicable.

Connecticut: Running through November 30, 2018, the state will provide an amnesty program called Fresh Start. Penalties will be waived and interest reduced to 50% for those who qualify. The qualifying liability owed must have failed to have been reported through December 31, 2016.

District of Columbia: As of October 1, 2017, the District will no longer send out paper returns. The only available format will be available on the website MyTax.DC.gov. It is allowable to send in a paper return until the end of the fiscal year in 2017. Also in the District, Qualified High Technology Companies (QHTCs) exemption certification will expire January 31, 2018 due to a new annual online certification process. The new process was effective November 1, 2017 and must be completed through MyTax.DC.gov.

Florida: The sales tax rate for leases on real property will decrease effective January 1 from 6% to 5.8%. The local option surtax amount does not change and should continue to be applied as before.

Cook County, Illinois: In our last issue of Completely Compliance, we noted that the sweetened beverage tax was moving forward effective August 2017. However, since then, the tax has been repealed effective December 1, 2017. Between the effective and repealed dates, the tax must still be collected and paid until November 30, 2017. A special “close out process” is in place for tax remittance and can be found on their website.

Massachusetts: The Commissioner has made the decision to not pursue the accelerated sales tax remittance program (ASTR). After a feasibility study issued on October 31, Commissioner Harding released a statement on November 1 that the program could not be implemented by the June 2018 date and no further action will be taken.

Michigan: Public Act 135 took effect on October 26, 2017. The bill prohibits local governments from implementing a tax on the sale of food. The bill applies to manufacturing, distribution, retail or wholesale sale of food.

Mississippi: The state has provided regulation on economic nexus and the requirement to register. At a threshold of $250,000 in sales into Mississippi in the last 12-month period, businesses will now be required to register with the Department of Revenue and collect the appropriate sales tax. The state further defines exploiting the Mississippi market to include television and application advertising, telemarketing and direct mail.

New Jersey: As noted in a previous issue, we remind you that another round of New Jersey rate reductions will take place January 1, 2018. The state rate will decrease from 6.875% to 6.625%.

Ohio: The rate rounding will be changed effective January 8, 2018. Per HB 49 county tax must now be levied in increments of one-tenth of one percent (0.10%) instead of the previous one-quarter of one percent (0.25%). The state, however, will continue to report at the one-quarter increment. Below is an example of the new calculation provided by the state. “For example, use tax is due for both Franklin County (1.75%) and the state (5.75%) on taxable purchases. The county portion is reported as the 2-digit county number (25 for Franklin County) and the rate (1.75% divided by .05% = 35). The new Franklin County rate code is 2535. The state portion of the rate code remains unchanged (8923) and is made up of the state code (89) and the rate (5.75% divided by .25% = 23).”

In addition, the Ohio Tax Amnesty Program will begin on January 1 and run through February 15, 2018. 100% of penalties and 50% of interest will be waived for those participating.

Port Townsend, Washington: The city has made some changes in the qualifications of business and licensing. If your company generates less that $100,000 in a calendar year, you are no longer required to file in 2018 and future periods. As the renewals are processed through the Washington Department of Revenue site and will not be able to be updated by January 1, you will still receive notification that the license is due. The City asks you pay the amount through the portal and any remaining balance will be invoiced by the city later. To review the change of notice, go to www.cityofpt.us then WebLink Dcouments Online under City Council and review Ordinance 3184.

Wisconsin: Annually, the state does a review of filing frequencies on all registered companies. Any companies whose sales have increased or decreased will be sent notification that their filing frequency has changed effective January 1, 2018. The information is very important to your DMA compliance team so that they may adjust and remit accordingly. Make sure to forward this information to your DMA contact as soon as possible.

Completely Compliance is a quarterly e-newsletter exclusively for clients and employees of DMA. It is intended to provide relevant sales/use tax news, events, and information. As such, this e-newsletter should be used for general informational purposes only, and not as a substitute for consultation with professional tax, legal, or other competent advisors. Before making any decision or taking any action based upon information contained in this e-newsletter, you should consult with a DMA professional.