I assume you are not filing in Illinois.
They automatically request support, even when we sent the K-1s with the original paper return.
Paper tax return because we want to show the withholding trail.
The amounts are usually small and it does not make cents to respond. (Misspelling on purpose).
IL is not the only state.
The issue to my firm is how clients feel about receiving these notices and having to pay taxes twice.
Not the dollars but the impression.
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Jeffrey Winer
WINER CPA PC
Framingham MA
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Original Message:
Sent: 11-11-2014 09:02
From: Stephen Mankowski
Subject: Latest tax "scam" by states
This message has been cross posted to the following Discussions: TAX COMMITTEE and Federal Tax .
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not sure if any of you have dealt with this issue, but here are the basics:
TP earns income via K1 as a non-resident and taxes are withheld on the K-1 and readily identified as such. At some point after filing the returns (or several years later), the state turns around denies a subsequent request for refund citing "prior balance due". In researching the prior balance, we quickly realize that the state simply disallowed the taxes that were withheld on the K-1. The TP returns were filed and accepted electronically.
Now, the issue is easily rectified - the TP (or preparer) resubmits the K-1 to the state and eventually the state will refund the TP. At issue, though, is how many TPs see a small balance due and simply pay it as it appears less expensive than having their CPA research it?
I've been dealing with several states recently, including Indiana, Maryland, West Virginia and Oklahoma. Each was the EXACT same situation.
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Stephen Mankowski, CPA
EP CAINE & ASSOCIATES, CPA LLC
Bryn Mawr PA
215-674-5652
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