Revised Forms and Credits: NYSDTF Opens New Year with a Bang

Published Date:
Jan 14, 2014

The staff at the New York State Department of Taxation and Finance apparently spent the holiday season gearing up for the upcoming tax season, releasing a variety of notices to correct and clarify key filing issues. All of the notices cover issues that tax practitioners should address in the near future.

The GST Form Fix

Important Notice N-13-11 doesn't change what should be done in 2014, but rather, what should've been done in past years and may need to be fixed now. The department is revising Form ET-500, Generation-Skipping Transfer Tax Return for Distributions, and Form ET-501, Generation-Skipping Transfer Tax Return for Terminations, to help address certain issues in returns filed from 2010 through 2013.

The notice explains that GST tax returns are required only for distributions or terminations resulting from the death of an individual. However, the department found some taxpayers were filing returns and paying taxes when they didn't have to. In addition, some filers made computational errors and overpaid GST taxes. The department is contacting affected taxpayers about credits or refunds that may apply.

The department is also fixing an error in the instructions. For 2011 and 2012, the department instructed Form ET-500 and ET-501 filers to use the current-year exemption amount for all terminations and distributions, no matter what year the property was transferred to the trust. "As a result, some filers may have computed an incorrect amount of New York State GST tax," said the notice. The department is revising forms and instructions to restore the table used for the state numerator limit and to clarify the GST tax calculations.

Further details and instructions on filing amended returns are available in the notice.

Credits…and More Credits

The tax department is also alerting taxpayers and their preparers to new and revised state tax credits.

Hire a Veteran Credit. Taxpayers subject to tax under articles 9-A, 22, 32 and 33 that hire qualified veterans in 2014 or 2015 are eligible for this nonrefundable credit. They can claim it in tax years 2015 and 2016. If the veteran is not disabled, the amount of the credit is equal to 10 percent of the total wages paid to the veteran during his or her first full year of employment, but not more than $5,000. For disabled veterans, the figures are 15 percent, but not more than $15,000.

New York Youth Works Tax Credit. The program provides corporate and income tax incentives to qualified businesses employing at-risk youths in full-time and part-time positions. This is not a new program, but chapter 59 of the laws of 2013 (part DD) made some significant changes: expanding the tax credit program by reducing the city population threshold and extending program allocations through 2017, among other provisions.

Minimum Wage Reimbursement Credit. Eligible employers (article 9, 9-A, 22, 32, and 33 taxpayers) are allowed a refundable credit equal to the number of hours worked by eligible employees for which they are paid the state minimum wage multiplied by the applicable tax credit rate. The credit is available starting this year and running through 2018. The program has many provisions: Perhaps the most significant is that employees must be at least 16 but not yet 20 years of age. Also, employers may not dismiss ineligible employees for the sole purpose of replacing them with eligible employees. The initial tax credit rate is 75 cents, and it goes up in succeeding years.        

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