State Electronic Websites

[Stringbean]

An increasing number of states are passing laws/regulations which require taxpayers to file electronically and pay via websites.

States and other taxing authorities should be thankful to get ANY money under ANY medium whatsoever, but that is another argument for ethical principles.

Before accepting money, these "pay-by-website" portals require an online account to be set up. Before allowing you to set up an online account they ask you questions (some of them personal), and some information to which they really don't need to simply accept money. A client contacted me today with a couple state payments to make, asking her questions neither she nor I could possibly know.

My strategy is to simply prepare a paper check, and if the client is penalized, to simply decline to pay based on difficulties created by the state. Do any of you have a more effective strategy?

[TAXNJ]

Who

An increasing number of states are passing laws/regulations which require taxpayers to file electronically and pay via websites.

States and other taxing authorities should be thankful to get ANY money under ANY medium whatsoever, but that is another argument for ethical principles.

Before accepting money, these "pay-by-website" portals require an online account to be set up. Before allowing you to set up an online account they ask you questions (some of them personal), and some information to which they really don't need to simply accept money. A client contacted me today with a couple state payments to make, asking her questions neither she nor I could possibly know.

My strategy is to simply prepare a paper check, and if the client is penalized, to simply decline to pay based on difficulties created by the state. Do any of you have a more effective strategy?

What states are requiring taxpayers to file electronically and pay via websites?

Don't they have an option to paper file?

Only aware of states giving the options and if filing electronically the only questions are DOB, social security # and prior year AGI (if any).

[S T]

Not sure about some of the State Websites -
North Carolina has a website that you can pay electronic, just simple information as in name, SSN, address, year, etc - not mandatory as far as I know - can still mail a paper check to NC

California has a mandatory electronic pay if amount due is over (individual) $ 20,000 or the tax liability over $80,000, once signed up on that epay - taxpayer has no choice but to pay via epay for all future payments, otherwise California imposes a penalty. It is not complicated to set up the Web Pay and Register. Curently the Web Pay is suspended until Jan 2016 due to upgrades for ID Theft issues - A waiver of penalty for non- epay can be filed.

I would be interested to learn of other States that are making epay mandatory and the dollar amount thresholds.

If you have a software that will file electronically, the electronic filing should not be an issue and there is a provision to also pay via ACH debit, again is it mandatory.

I have several clients - actually many clients, that are not computer savy-- do not even own a computer - so filing electronically and paying electronically would not be an option for those clients, unless they provided the information to me.

I also know that there are some posters on the TMI Board that do not electronically file returns - so they might have more insight on any electronic payments as well.

Sandy

[TAXNJ]

Mix

Not sure about some of the State Websites -
North Carolina has a website that you can pay electronic, just simple information as in name, SSN, address, year, etc - not mandatory as far as I know - can still mail a paper check to NC

California has a mandatory electronic pay if amount due is over (individual) $ 20,000 or the tax liability over $80,000, once signed up on that epay - taxpayer has no choice but to pay via epay for all future payments, otherwise California imposes a penalty. It is not complicated to set up the Web Pay and Register. Curently the Web Pay is suspended until Jan 2016 due to upgrades for ID Theft issues - A waiver of penalty for non- epay can be filed.

I would be interested to learn of other States that are making epay mandatory and the dollar amount thresholds.

If you have a software that will file electronically, the electronic filing should not be an issue and there is a provision to also pay via ACH debit, again is it mandatory.

I have several clients - actually many clients, that are not computer savy-- do not even own a computer - so filing electronically and paying electronically would not be an option for those clients, unless they provided the information to me.

I also know that there are some posters on the TMI Board that do not electronically file returns - so they might have more insight on any electronic payments as well.

Sandy

Think Original Poster may mean individuals and/or businesses depending on state. Know there is a push for many business taxes be mandated to pay via electronically. Be interesting to know if exception for those not using computer. But in those cases, file via telephone maybe required for those states getting away from paper filing.

Easy way to know is to visit specific state web-site to get requirements.

[Rapid Robert]

I have several clients - actually many clients, that are not computer savy-- do not even own a computer - so filing electronically and paying electronically would not be an option for those clients, unless they provided the information to me.

If they are your clients, then wouldn't it be you, not them, who has the mandate (or at least the ability) to file electronically?

It's not just the state tax authorities or IRS -- virtually EVERY entity that collects money strongly encourages electronic payments these days, except maybe the Salvation Army street corner bell ringer, and even they will probably take an online payment.

It's getting to the point where the "I don't have a computer" excuse will be as flimsy as the "I don't have a checking account" excuse -- and folks in the latter category are still expected to make payments without using actual currency. Even if one has zero ability to pay online using their own device (highly unlikely for someone who actually owes taxes), there are still alternatives, for example many UPS Stores will have a secure business computer available for brief rental periods (I didn't mention public library access, since I know someone would say that's not acceptable).

[David1980]

I've had clients that were very upset over not being able to mail a check for their 1120 returns. Fortunately I haven't had to deal with any electronic payment requirements at the state level just yet.

[Golden Rocket]

I don't blame him

The stakes are obvious - states can slash administrative costs by requiring electronic filing and electronic payment.

However, this should not be their right. Governments and taxing authorities have a godlike approach to the very sources of their livelihood. They should bear the consequences of biting the hand that feeds them.

The guy was hacked off because he couldn't pay his 1120 with a check? I don't blame him. Work like a dog, build a company, make money, and then it's bad enough to have the gubbermint stick out its hands for money that you've earned. Then when you get ready to pay them, they stick their hand in your face and tell you they can't take a check. By all rights, they should just do without the money.

I got caught in a speed trap earlier this year and agreed to pay the fine, but Maury County Tennessee sent my check back to me and told me they couldn't take a check. I sent the check back to them with a note that this was their payment and if they sent it back to me again there would not be a third attempt. The court clerk called my wife and told her they were going to the state and have my license pulled. Of course, I knew this would create a mountain of administrative headaches for them, and it would be easier to simply cash the check. Never heard from them but I noticed when I received my bank statement they actually DID cash the check.

Government bureaucrats and workers are so predictable...

[JohnH]

I thought for a moment you were going to tell a story similar to the guy who got an automated ticket in the mail for running a red light.

He wrote back claiming he didn't drive through the light.
They wrote back including a picture of his car with the license tag and the red light clearly visible.
He wrote back, sending them a picture of a check to pay the fine.
They wrote back with a picture of a set of handcuffs.
He paid the fine.

[TAXNJ]

No

If they are your clients, then wouldn't it be you, not them, who has the mandate (or at least the ability) to file electronically?

It's not just the state tax authorities or IRS -- virtually EVERY entity that collects money strongly encourages electronic payments these days, except maybe the Salvation Army street corner bell ringer, and even they will probably take an online payment.

It's getting to the point where the "I don't have a computer" excuse will be as flimsy as the "I don't have a checking account" excuse -- and folks in the latter category are still expected to make payments without using actual currency. Even if one has zero ability to pay online using their own device (highly unlikely for someone who actually owes taxes), there are still alternatives, for example many UPS Stores will have a secure business computer available for brief rental periods (I didn't mention public library access, since I know someone would say that's not acceptable).

No, not my mandate, to answer your question. Can you force you client or can they mandate you to pay their tax bill? Can you mandate your client to efile their return?

There are people who do not use computers, tax preparers, etc. and always will be and should have the right to pay the way they want.

See Golden Rocket reply post.

[JohnH]

If they are your clients, then wouldn't it be you, not them, who has the mandate (or at least the ability) to file electronically?

It's not just the state tax authorities or IRS -- virtually EVERY entity that collects money strongly encourages electronic payments these days, except maybe the Salvation Army street corner bell ringer, and even they will probably take an online payment.

It's getting to the point where the "I don't have a computer" excuse will be as flimsy as the "I don't have a checking account" excuse -- and folks in the latter category are still expected to make payments without using actual currency. Even if one has zero ability to pay online using their own device (highly unlikely for someone who actually owes taxes), there are still alternatives, for example many UPS Stores will have a secure business computer available for brief rental periods (I didn't mention public library access, since I know someone would say that's not acceptable).

I know lots of people who don't own or use computers.
You can take them to the Library or the UPS Store, but they still won't know what to do with one.
Some of my clients are like that, and I respect their RIGHTS to live life in the way that works for them.
Our government should do the same, rather than imposing its bureaucratic will on every citizen.

And no tax preparer has a mandate to file electronically.
Only tax FILERS have a mandate to do so.
The mandate is something tax preparers have submitted to by voluntarily jumping on the e-flinging bandwagon.

[DaveO]

Nebraska requires efile and epay if you owe over $5,000 annually in any tax program. I too have clients who don't have computers. When I applied for an exemption I was told "Too bad, they will need to get one or we will charge $100 per return". I don't like filing sales tax returns because it makes me file a return my client has not reviewed or authorized. For other programs I must do the return twice, once on the computer and again on their website. I guess we are just one EMP away from shutting down every branch of government.

[TAXNJ]

DaveO

Nebraska requires efile and epay if you owe over $5,000 annually in any tax program. I too have clients who don't have computers. When I applied for an exemption I was told "Too bad, they will need to get one or we will charge $100 per return". I don't like filing sales tax returns because it makes me file a return my client has not reviewed or authorized. For other programs I must do the return twice, once on the computer and again on their website. I guess we are just one EMP away from shutting down every branch of government.

So the $100 penalty does not apply to Indidual Returns but business returns. Can one efile & pay by telephone?

[Stringbean]

Further Discussion

I will re-enter the discussion and point out that the referenced problems are with paying electronically, and not necessarily filing, which is usually handled by our software company. Electronic filing is certainly a related topic, and often occurs as a mandate from state as well as the payment requirement.

For those of you who have not dealt with the problem, suffice it to say many states require not only electronic filing but also electronic payments. Tennessee and Alabama are two of them. I just finished a large return with 15 states and several of them had these requirements. Here is a sampling of questions encountered by my client when attempting to pay:

1) What is your Federal ID# (or State identifying number)
2) What type of tax is this?
3) What tax period does the payment cover?

Stop here, because in my way of thinking this is ALL the state needs to know in order to process the payment and give proper credit.
However, here are other questions encountered because the states need to populate some incriminating database.

4) When was your entity incorporated (or established) in your state?
5) When did you start doing business in OUR state?
6) What salary does your president (or CEO, proprietor) make?
7) How many shares of stock are authorized and issued for your corporation?
8) Who is the registered agent for service in our state?
... and there are more questions of this nature.

I won't argue that the state may have a RIGHT to these last several questions, but none of them are essential to take the electronic payment and properly credit the right account. Yet they are pursuing these other questions because they believe the taxpayer is seeking a PRIVILEGE to pay. And they think they will bully the taxpayer into jumping through these hoops under threat of penalty.

If there is a "privilege" for anyone it should be for the taxing authority to receive money, considering all the taxpayers who don't pay or don't even file. It's like the lazy man who won the lottery and asked the delivery person to steady the front porch hammock and stuff it in his pocket.

I have advised my clients to send a paper check and resist the penalty if the state tries to assess it.

[TAXNJ]

Good

I will re-enter the discussion and point out that the referenced problems are with paying electronically, and not necessarily filing, which is usually handled by our software company. Electronic filing is certainly a related topic, and often occurs as a mandate from state as well as the payment requirement.

For those of you who have not dealt with the problem, suffice it to say many states require not only electronic filing but also electronic payments. Tennessee and Alabama are two of them. I just finished a large return with 15 states and several of them had these requirements. Here is a sampling of questions encountered by my client when attempting to pay:

1) What is your Federal ID# (or State identifying number)
2) What type of tax is this?
3) What tax period does the payment cover?

Stop here, because in my way of thinking this is ALL the state needs to know in order to process the payment and give proper credit.
However, here are other questions encountered because the states need to populate some incriminating database.

4) When was your entity incorporated (or established) in your state?
5) When did you start doing business in OUR state?
6) What salary does your president (or CEO, proprietor) make?
7) How many shares of stock are authorized and issued for your corporation?
8) Who is the registered agent for service in our state?
... and there are more questions of this nature.

I won't argue that the state may have a RIGHT to these last several questions, but none of them are essential to take the electronic payment and properly credit the right account. Yet they are pursuing these other questions because they believe the taxpayer is seeking a PRIVILEGE to pay. And they think they will bully the taxpayer into jumping through these hoops under threat of penalty.

If there is a "privilege" for anyone it should be for the taxing authority to receive money, considering all the taxpayers who don't pay or don't even file. It's like the lazy man who won the lottery and asked the delivery person to steady the front porch hammock and stuff it in his pocket.

I have advised my clients to send a paper check and resist the penalty if the state tries to assess it.

Good. You have an "opt out" for electronic payment. Should solve the problem.

Maybe the questions are for ID purposes. Also, think many of the questions/answers the state already knows from the tax return.

One would think the EIN# and bank info would suffice but who knows their rationale! Stay with your opt out position and everyone is happy.