Benjamin Yazersky CPA wrote:

- quote -

I don't see it because I have no New York clients at
present. However Noo Yawk's department of revenue did
announce that all those 1099's were wrong and they're
sending out new ones.

When in doubt of course, use the actual amount shown on
client's last year's return.

ChEAr$,
Harlan Lunsford, EA n LA

<< ================================================== ===== > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2006) - All rights reserved. > << ================================================== ===== >

"Benjamin Yazersky CPA" <johndoe[at]nowhere.com> wrote:

- quote -

I believe NY is absolutely correct about that. The penalty
is NOT deductible, so if a penalty reduces a refund, it is
the GROSS refund that is potentially taxable. If there is a
balance due that is less than the penalty, then the refund
which would have been received, absent the penalty, is
taxable. You need to ignore the penalty to calculate what
the "income tax" refund is. Similarly, if you pay a use tax
on your NYS return, that use tax reduces the cash refund,
but does not reduce the taxable refund.

--
Bruce E. Cobern, CPA
mailto:bec[at]pipeline.com

<< ================================================== ===== > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2006) - All rights reserved. > << ================================================== ===== >

"Benjamin Yazersky CPA" <johndoe[at]nowhere.com> wrote:

- quote -

No, I file IT-201 instead of IT-203 and my 1099-G is
correct, but .... as you probably know the amount reported
by NY on the 1099-G differs from the actual overpayment
shown on Line 74 of IT-201 by the amount of the Sales and
Use Tax entered on Line 68 of IT-201 plus any Voluntary
Contributions listed on Line 60, again of IT-201.

The fact that the Sales and Use Tax line causes the
overpayment reported on the 1099-G to be different than the
Overpayment shown on the tax return is causes a lot of
confusion for NY taxpayers and must generate thousands of
telephone calls claiming that the 1099-G is incorrect.

Perhaps the person you spoke with was just overwhelmed by
all the calls regarding this other 1099-G issue.

--
Vic Roberts
Replace xxx with vdr in e-mail address.

<< ================================================== ===== > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2006) - All rights reserved. > << ================================================== ===== >

Taxpayer gives me a 1099G from NYS for 2005 overpayment
received in 2006. So, I check the 1099G to the 2005 tax
return. The NY return (IT203) had a balance due. I notice
the amount on the 1099G matches line 71 of form IT203. That
line is penalty for underpayment of estimated tax (IT2105.9)
It appears that NYS is reporting the penalty for
underpayment of estimated tax as a tax refund. There is no
taxable income to report. The 1099G is erroneous.

So, I call the phone # on the back of the 1099G. After being
on hold for about 45 min, I finally am able to get through
to a supervisor who could do nothing more than a
bureauocratic it's right because we did it & we did it
because it`s right & if you don't like it go call someone
else.

It appears that the way NY process tax returns is that they
take your full payment and applied it to the taxes,
generating an overpayment that was then applied to the pay
the penalty. It's this phantom overpayment thats reported
on the 1099G. That would make it a systemic problem.

This could cause the IRS to send out notices for mismatches
on the 1099G's.

Anyone else see this?

--

___________________________________
<<< Benjamin Yazersky, CPA [NJ & NY] > > -----> real address on hobokeni or hobokenx <-----

<< ================================================== ===== > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2006) - All rights reserved. > << ================================================== ===== >