How to Implement the New Tax Exemption
Tuesday, October 31, 2023
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Posted by: Amy O'Rourke
FALI LEGISLATIVE
NEWS ALERT
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FALI LEGISLATIVE
NEWS ALERT
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Update:
How to Implement the New Tax Exemption
As promised we have been keeping up with the implementation of
the Sales Tax exemption for PIs. The biggest question we have been getting is should members
inactivate their accounts with the DOR or file zero. The answer to both
those questions is YES. Now you have to decide which option works best
for you.
Inactive Account Option
We have heard from several members that they asked DOR to
inactivate their account and in turn received confirmation that their
account is indeed inactive. Members are
encouraged to speak with their CPAs to see if this the best option for
your business. There could be some benefits to keeping your DOR number.
If you choose this option you can easily do it through the DOR website. Click HERE
to go to the DOR website. On the left hand side click on the tab that
says, “Businesses & Employers." Then look for
General Tax Administration and the option, "Change Address or Account Status" and
follow the instructions on the form.
“$0” Option
We have heard from other members that they have been told they
should continue to file reports with “$0” indicated as the dollar
amount. Representative Mike Caruso, our original bill sponsor, and a
CPA, concurs with this course of action.
Rep. Caruso said, “I would concur with the DOR as the best means
of reporting. File zero returns. After a year the DOR will then
automatically change the PI company's reporting requirements
to once annually. This way if they do exceed $150,000 a year, 2, or 3
later they will then start to report actual taxable services.
Whichever option you choose you should still keep your backup
documentation in case there is ever a question and of course make your
CPA aware of this change and get their input. Also please keep us updated on your experiences with the choice you make.
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