The Division of Taxation has posted the latest Administrative Decision. It focuses on whether a taxpayer was a "responsible officer" and thus liable for tax, penalty, and interest.
Thursday, December 31, 2015
Wednesday, December 30, 2015
Tax changes take effect on Friday
The Rhode Island Division of Taxation today reminded tax professionals that a number of tax changes will take effect this Friday, January 1, including:
- A reduction in the annual corporate minimum tax;
- A reduction in the annual filing charge for pass-through entities;
- A tax break for many Social Security beneficiaries; and
- An increase in the earned income credit.
Thursday, December 24, 2015
Booklet of income tax withholding tables
The Rhode Island Division of Taxation has
posted on its website the booklet of income tax withholding tables for tax year 2016.
Employers use the tables to calculate how much to withhold from an employee’s
pay for Rhode Island personal income tax purposes. The booklet also includes a copy of the 2016
version of Form RI W-4, "Employee’s Withholding Allowance
Certificate."
Holiday schedule
The regular hours of operation for the Rhode Island Division of Taxation, at One Capitol Hill in Providence, Rhode Island, are 8:30 a.m. to 3:30 p.m. business days, unless otherwise stated. Following is the holiday schedule:
- December 24: regular hours
- December 25: closed
- December 31: regular hours
- January 1: closed
Wednesday, December 23, 2015
Final regs posted on apportionment, nexus
The
Division of Taxation today posted, as final, regulations involving
apportionment and nexus for corporate income tax purposes.
The regulations help
to implement sweeping changes to the structure of the corporate income tax that
were enacted in 2014 and that took effect for tax years beginning on or after
January 1, 2015. The regulations will take effect January 12, 2016. Click here for the apportionment regulation, here for the nexus regulation.
Saturday, December 19, 2015
Practitioner Alert: Double-tax benefit available through new law
Eligible Rhode Island businesses and individuals will receive a double-tax benefit for certain expenses as a result of legislation approved by Congress and signed into law by President Barack H. Obama yesterday.
Section 179 expensing
The new law permanently increases the amount that small businesses can deduct all at once in any given year for acquiring certain types of property. Because Rhode Island tax law is linked to federal tax law in this regard, the higher deduction limits will apply not only for federal tax purposes, but also for Rhode Island tax purposes. Thus, if a business claims the deduction at the federal level, the business will automatically qualify for the same deduction for Rhode Island tax purposes.
The deduction involves Section 179 of the Internal Revenue Code and is known as the "Section 179 deduction." In general, it applies to “qualifying property” – which means depreciable tangible personal property that is purchased for use in the active conduct of a trade or business. “Qualifying property” also includes off-the-shelf computer software and qualified real property.
The new federal law raises, to $500,000 from $25,000, the annual Section 179 expensing limit permanently -- for tax years beginning after December 31, 2014. The $500,000 limit applies for both federal and Rhode Island tax purposes. The phase-out limit, which was $200,000, is now $2 million for tax years beginning after December 31, 2014, for federal and Rhode Island tax purposes.
Tuition-and-fees deduction
The federal deduction for qualified tuition and related expenses for higher education, under Internal Revenue Code section 222, is extended through 2016. (It had expired for taxable years beginning after December 31, 2014.) If someone qualifies for the deduction at the federal level, it will reduce that person’s federal adjusted gross income – and will automatically reduce the amount of income taxed by Rhode Island, thus saving that person federal and Rhode Island taxes. The maximum federal deduction is $4,000. Income limits apply.
Educator expense deduction
A federal deduction of up to $250 for certain expenses of elementary and secondary schoolteachers, under Internal Revenue Code section 62, was available for taxable years beginning prior to January 1, 2015. Under the new law, the provision is permanently extended. In general, the deduction is for books, supplies, computer equipment (including related software and services) and other equipment, and supplementary materials used by the eligible educator in the classroom. If someone qualifies for the deduction at the federal level, it will reduce that person’s federal adjusted gross income – and will automatically reduce the amount of that person’s income taxed by Rhode Island, thus saving that person in federal and Rhode Island taxes. Starting in 2016, the $250 cap will be indexed to inflation. Also, professional development expenses will be considered as eligible expenses for purposes of the deduction.
Advisors
Businesses and individuals may wish to consult their tax advisors to review the new federal tax law to see how it applies to them, and the impact on their Rhode Island taxes. For more details, click here.
Section 179 expensing
The new law permanently increases the amount that small businesses can deduct all at once in any given year for acquiring certain types of property. Because Rhode Island tax law is linked to federal tax law in this regard, the higher deduction limits will apply not only for federal tax purposes, but also for Rhode Island tax purposes. Thus, if a business claims the deduction at the federal level, the business will automatically qualify for the same deduction for Rhode Island tax purposes.
The deduction involves Section 179 of the Internal Revenue Code and is known as the "Section 179 deduction." In general, it applies to “qualifying property” – which means depreciable tangible personal property that is purchased for use in the active conduct of a trade or business. “Qualifying property” also includes off-the-shelf computer software and qualified real property.
The new federal law raises, to $500,000 from $25,000, the annual Section 179 expensing limit permanently -- for tax years beginning after December 31, 2014. The $500,000 limit applies for both federal and Rhode Island tax purposes. The phase-out limit, which was $200,000, is now $2 million for tax years beginning after December 31, 2014, for federal and Rhode Island tax purposes.
Tuition-and-fees deduction
The federal deduction for qualified tuition and related expenses for higher education, under Internal Revenue Code section 222, is extended through 2016. (It had expired for taxable years beginning after December 31, 2014.) If someone qualifies for the deduction at the federal level, it will reduce that person’s federal adjusted gross income – and will automatically reduce the amount of income taxed by Rhode Island, thus saving that person federal and Rhode Island taxes. The maximum federal deduction is $4,000. Income limits apply.
Educator expense deduction
A federal deduction of up to $250 for certain expenses of elementary and secondary schoolteachers, under Internal Revenue Code section 62, was available for taxable years beginning prior to January 1, 2015. Under the new law, the provision is permanently extended. In general, the deduction is for books, supplies, computer equipment (including related software and services) and other equipment, and supplementary materials used by the eligible educator in the classroom. If someone qualifies for the deduction at the federal level, it will reduce that person’s federal adjusted gross income – and will automatically reduce the amount of that person’s income taxed by Rhode Island, thus saving that person in federal and Rhode Island taxes. Starting in 2016, the $250 cap will be indexed to inflation. Also, professional development expenses will be considered as eligible expenses for purposes of the deduction.
Advisors
Businesses and individuals may wish to consult their tax advisors to review the new federal tax law to see how it applies to them, and the impact on their Rhode Island taxes. For more details, click here.
Friday, December 11, 2015
Inflation-adjusted amounts for tax year 2016
The Rhode Island Division of Taxation has set the standard deduction amounts, exemption amounts, tax bracket changes, and certain other key inflation-adjusted figures for tax years beginning on or after January 1, 2016. For details, click here.
Division of Taxation holds seminar in Newport
More than 100 tax professionals attended yesterday's "Seminar for Tax Preparers" sponsored by the Rhode Island Division of Taxation.
The event, held at the Community College of Rhode Island campus in Newport, featured information about what's new for the coming filing season and what's new for tax year 2016. The seminar also included discussions about e-filing, tax credits, the statewide property-tax relief program (Form RI-1040H), the annual sales tax reconciliation, and other topics. The printed presentation is available online.
The event, held at the Community College of Rhode Island campus in Newport, featured information about what's new for the coming filing season and what's new for tax year 2016. The seminar also included discussions about e-filing, tax credits, the statewide property-tax relief program (Form RI-1040H), the annual sales tax reconciliation, and other topics. The printed presentation is available online.
 |
| Chief Revenue Agent Leo Lebeuf at Newport seminar |
Friday, December 4, 2015
Arrest and seizure in tobacco tax case
A joint investigation by the Providence Police Department and the Rhode Island Division of Taxation into the illegal distribution of untaxed tobacco products has resulted in an arrest and in the seizure of more than $20,000 in U.S. currency and contraband tobacco. The Providence Police Department announced details of the case this afternoon. Click here for details.
Subscribe to:
Posts (Atom)