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Starting a Corporation in New York State

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Starting a Corporation in New York State Powered By Docstoc
					New York State
Department of
Taxation and Finance




                   New York State
                 Publication 115


       Corporation Tax
  Modernized E-File Handbook
   For Software Developers

                    Tax Year 2010




      The information presented is current as of this publication's print date.
        Visit our Web site at www.nystax.gov for up-to-date information.
                                                        Corporation Tax
                                                   Modernized E-File Handbook
                                                    For Software Developers

Table of Contents 
Introduction ............................................................................................................................................. - 4 - 
What’s New for Tax Year 2010 .............................................................................................................. - 5 - 
IRS MeF Fed/State Program ................................................................................................................... - 5 - 
NEW ITEMS IN TAX YEAR 2010 ....................................................................................................... - 6 - 
   Forms Based Schema Design.............................................................................................................. - 6 - 
   New Forms Supported ........................................................................................................................ - 6 - 
       Accepted XML forms: .................................................................................................................... - 6 - 
       Accepted as “pdf” attachments: ...................................................................................................... - 7 - 
   Payment Voucher for E-Filed Corporation Tax Returns .................................................................... - 7 - 
   Resubmission of NYS rejected return/extension ................................................................................ - 7 - 
   Guidelines for Entering Foreign Addresses ........................................................................................ - 8 - 
   Tax Return Preparers & Software Companies Not to Charge Separately for NYS E-File Services .. - 8 - 
   Elimination of the Corporation Opt-Out for e-filing .......................................................................... - 8 - 
   ACH Debit Settlement Date Guidelines to be Strictly Enforced ........................................................ - 9 - 
Contact Information .............................................................................................................................. - 10 - 
Participation Requirements ................................................................................................................... - 11 - 
   Additional Software Developer Requirements ................................................................................. - 13 - 
Websites and Publications .................................................................................................................... - 14 - 
e-File Corporation Tax Forms Supported for Tax Year 2010 .............................................................. - 16 - 
2010 Tax Year e-File Calendar ............................................................................................................. - 17 - 
Software Acceptance, Testing and Approval........................................................................................ - 17 - 
Acknowledgement System.................................................................................................................... - 18 - 
   IRS action on a State submission ...................................................................................................... - 18 - 
   State receipt and acknowledgment.................................................................................................... - 19 - 
   Resubmission of NYS rejected return/extension .............................................................................. - 19 - 
   Processing delays .............................................................................................................................. - 19 - 
Payment Handling and Acceptance ...................................................................................................... - 19 - 
   ACH Debit ........................................................................................................................................ - 20 - 
   ACH Credit ....................................................................................................................................... - 21 - 
   Payment Voucher (CT-200-V) ......................................................................................................... - 21 - 
   Common questions about an electronic funds withdrawal (direct debit) ......................................... - 21 - 
Signature Requirements for Corporate e-File Documents .................................................................... - 23 - 
   ERO/Preparer Signature Requirement for e-file Returns ................................................................. - 24 - 

Tax Year 2010 Publication 115                                     -2-                                                                11/4/2010
   Electronic Return Originator (ERO) Signature Requirement for Extensions ................................... - 26 - 
   Self-filer Signature Requirement for Returns ................................................................................... - 28 - 
   Self-filer Signature Requirement for Extensions ..............................................................................- 29 - 
General Information .............................................................................................................................. - 30 - 
   Business tax e-file mandate for tax return preparers ........................................................................ - 30 - 
       Starting January 1, 2011 ............................................................................................................... - 30 - 
       Who mandate applies to ................................................................................................................ - 30 - 
   How to comply with the mandate ..................................................................................................... - 31 - 
       New York State corporation tax returns and extensions ............................................................... - 31 - 
       New York State sales tax returns .................................................................................................. - 31 - 
       Penalties ........................................................................................................................................ - 31 - 
   Business Tax E-file Mandate for Self-Filers .................................................................................... - 32 - 
   Exclusions from New York State Corporation Tax e-File................................................................ - 32 - 
   International ACH Transactions (IAT) ............................................................................................. - 32 - 
   Issuers Allocation Percentage ........................................................................................................... - 32 - 
   Foreign Country Codes ..................................................................................................................... - 33 - 
   Voluntary Disclosure Program ......................................................................................................... - 33 - 
   Attaching Non-XML Documents ..................................................................................................... - 33 - 
   Error Categories - Business Rules .................................................................................................... - 34 - 
   Edits and Verifications ...................................................................................................................... - 35 - 
   Schemas and specifications............................................................................................................... - 36 - 




Tax Year 2010 Publication 115                                     -3-                                                                11/4/2010
Introduction 

The New York State Department of Taxation and Finance participates in the Fed/State 1120 Corporation
Tax e-file program, under the IRS Modernized e-File (MeF) architecture.

Electronic Return Originators (ERO’s) authorized by the IRS to e-File federal corporation tax are also
authorized to e-file corporation tax returns with New York State. New York does not require EROs to
apply for our program, or provide copies of their IRS acceptance letters to NYS.


Important!
 NYS Department of Tax and Finance requests a software developer provide the department with a copy
of new software as soon as it is released to the public. The department will use the software for research
and to troubleshoot production issues. The department will not use the software to prepare and/or file
returns. If the software developer supports e-file via an online application, the department requests
access to that as well.

If additional information is needed regarding the department’s use of software, please contact Ron
LeClair at (518) 457-4727.

Please mail a copy of your software to:      NYS Dept of Tax and Finance
                                             TSS Corporation Tax – e-File
                                             Bldg 8 Room 738
                                             WA Harriman Campus
                                             Albany NY 12227

Schema Version Number
The version number includes the tax year, the version initial and version number for which the schema
and business rule document applies. The version initial is case sensitive. The version number of MeF
business rules that are invoked for the MeF XML schemas will always have the same version number as
the schema version, thereby, providing a mechanism that aligns the various versions of schemas with
their applicable business rules.

New York State schema version used is State1120VersionNumber=”2010v1.3”.
                                 




Tax Year 2010 Publication 115               -4-                                         11/4/2010
What’s New for Tax Year 2010 

•    Tax returns for Tax Years 2008, 2009, and 2010 will be accepted. Tax year 2007 returns will no
     longer be accepted.
•    Forms based schema design has replaced the category based schema design in the NYS schema.
     See info on Page 6 describing the entering of data for elements; MAIL_LN_1_ADR &
     MAIL_LN_2_ADR
•    NYS will now support forms CT-400, CT-245, CT-3-A, CT-3-A/C, CT-3-A/ATT.
•    NYS will now support forms CT-3-A/B, CT-50 & CT-51 as a pdf attachment.
•    NYS will allow taxpayers who e-file their returns to pay via a check or money order by mailing
     form CT-200-V (Payment Voucher for E-Filed Corporation Tax Returns) along with the payment.
•    Rejected returns and extensions must include original submission ID with the re-submitted
     return/extension
•    New guidelines for entering foreign addresses have been established.
•    NYS now has a requirement that Software developers cannot charge a separate fee for e-file.
     Software developers can also not sell one version of their software that charges for e-file and
     another version that does not.
•    NYS has eliminated the Corporation Opt-Out and Reasonable Cause Record (TR-800-CT) for e-
     filing Corporation Tax returns.
•    ACH Debit settlement date guidelines will be strictly enforced

 
IRS MeF Fed/State Program 

MeF will accept two kinds of submissions (1) IRS (federal) submissions and (2) State submissions. Each
return must be enclosed in a separate submission, but multiple submissions may be contained in a single
message.

New York State will support “linked” and “unlinked” state returns. A State submission can be linked to
the IRS submission by including the Submission ID of the federal return in the State manifest.
If the State submission is linked to an IRS submission (also referred to as a Fed/State return), the IRS
will check to see if there is an accepted IRS submission under that Submission ID. If there is not an
accepted federal return, the IRS will deny the State submission and a deny acknowledgement will be
sent. If there is an accepted federal return under that Submission ID, then MeF will validate certain
elements on the State submission and provide the submission to the participating state.
If the State return is not linked to a previously accepted federal return (also referred to as State Stand-
Alone Return), then MeF will validate certain elements of the submission. If IRS does not deny the state
return, it will provide the State submission to the participating state regardless of the federal return.

New York requires a copy of the federal return. Both Federal and State returns must be in XML format.
The federal returns must conform to the IRS valid schema versions. New York State returns must
conform to the corporate New York State Schema.




Tax Year 2010 Publication 115               -5-                                          11/4/2010
 
NEW ITEMS IN TAX YEAR 2010 

Forms Based Schema Design 


Forms based schema design has replaced the category based schema design in the NYS schema. The
element naming convention has been changed. Data must be entered in the “claimed” attribute of an
element.

A new BO (TICORPBO) has been created which will contain the TP information. This BO would contain the
following fields:

BUS_TRADE_NAME
LEGAL_NAME
MAIL_CITY_ADR
MAIL_CNTRY_CD
MAIL_LN_1_ADR (Not required and should only be used to list the c/o address info)
MAIL_LN_2_ADR (Required element and used to list the street address)
MAIL_STATE_ADR
MAIL_ZIP_4_ADR
MAIL_ZIP_5_ADR
NAICS_CODE
EXT_TP_ID
STATE_INCORP_NAME
TP_PHONE_NMBR
MAILING_NAME

More information can be found in the Tax Year 2010 Schema Library at:

http://www.tax.state.ny.us/elf/swd_corporation.htm


New Forms Supported  
 Accepted XML forms: 

CT-245     Maintenance Fee and Activities Return For a Foreign Corporation Disclaiming Tax Liability
CT-3-A     General Business Corporation Combined Franchise Tax Return
CT-3-A/C   Report by a Corporation Included in a Combined Franchise Tax Return
CT-400     Estimated Tax for Corporations

(Each of the above forms is a main form and must come in as a stand-alone filing).

The CT-3-A/C should be filed as a standalone submission, one for each member.


CT-3-A/ATT Schedules A, B & C - Attachment to Form CT-3-A

(CT-3-A/ATT may come in with a CT-3-A only).


Tax Year 2010 Publication 115               -6-                                          11/4/2010
Accepted as “pdf” attachments: 

CT-3-A/B        Subsidiary Detail Spreadsheet – (May come in with a CT-3-A only).
CT-50           Combined Filer Statement for Existing Groups
CT-51           Combined Filer Statement for Newly Formed Groups



Payment Voucher for E­Filed Corporation Tax Returns 

Starting with Tax Year 2010 returns, NYS will now support Form CT‐200‐V, Payment Voucher for 
E‐Filed Corporation Tax Returns.  
 
E‐Filers may now use Form CT‐200‐V to mail in a check or money order to make payments for 
their e‐filed returns, extensions and estimated payments.  Form CT‐200‐V should ONLY be used to 
make payments for e‐filed returns/extensions and should NOT be used to send in a payment for 
any paper filed return/extension. Software must limit the printing of the voucher to documents 
that are e‐filed by the customer. 
 
 
Form CT‐200‐V should be able to be created at the time the software user completes entering their 
return information. Should they choose to mail in a check or money order to make their payment, 
the software should include instructions to print out the form and mail it in along with their 
payment. The software must populate all fields, except the amount of the payment. Form CT‐200‐V 
should be sent to NYS with the enclosed payment and nothing else attached. There is no need to 
write any additional information on the form, attach a copy of the return data or attach a letter of 
explanation. The effective date of the payment will be the postmark date, if the payment is 
postmarked on or before the due date. If it is postmarked after the due date, the effective date of 
the payment will be the date it is received.  
 
 

Resubmission of NYS rejected return/extension 

If a state return or extension is rejected by NYS due to an error, the error can be corrected and the return
or extension can be re-submitted. The corrected, re-submitted return must contain the original
submission ID of the rejected return/extension in the field named ORIG_SBMSN_ID.

 

 

 

 

 

 

Tax Year 2010 Publication 115                -7-                                          11/4/2010
Guidelines for Entering Foreign Addresses 

Foreign Addresses must be submitted as follows:


MAIL_LN_2_ADR - With the exception of Canadian addresses, foreign zip codes should be entered at
the end of the address field (MAIL_LN_2_ADR).

MAIL_CITY_ADR - Enter city/town as applicable

MAIL_STATE_ADR - For Canadian addresses enter province, for all other foreign addresses state must
be blank.

MAIL_CNTRY_CD - Enter the appropriate foreign country code as defined by the IRS. They are
available at http://www.irs.gov/efile/article/0,,id=175595,00.html.

MAIL_ZIP_5_ADR and MAIL_ZIP_4_ADR - For Canadian addresses, enter the first 3 characters of
the zip code in MAIL_ZIP_5_ADR, and enter characters 4-6 of the zip code in MAIL_ZIP_4_ADR.
For all other foreign addresses, MAIL_ZIP_5_ADR and MAIL_ZIP_4_ADR must be blank.



Tax Return Preparers & Software Companies Not to Charge Separately for NYS 
E­File Services 

New York State enacted legislation under Section 34 of the Tax law that makes it unlawful for a Tax
Return Preparer or Software Company to charge a separate fee for the electronic filing of authorized
NYS returns, extensions or payments.

It is also unlawful for Software Companies to offer a version of its tax software that charges a separate
fee for the electronic filing of authorized NYS returns, extensions or payments and one version of the
same tax software that does not charge.

Any Tax Return Preparer or Software Company who violates this policy will be liable for a civil penalty
of $500 for the first violation and $1,000 for each succeeding violation.



Elimination of the Corporation Opt­Out for e­filing  

NYS has eliminated the Corporation opt-out and reasonable cause record for e-filing Corporation tax
returns. Form # TR-800-CT is obsolete and may not be included in any software package. Taxpayers
may no longer elect not to file their tax return or extension electronically. Tax preparers are subject to a
$50 penalty for each failure to electronically file a return unless it is due to reasonable cause and not due
to willful neglect. Reasonable cause will be considered on a case by case basis.



 

 
Tax Year 2010 Publication 115                -8-                                          11/4/2010
ACH Debit Settlement Date Guidelines to be Strictly Enforced 

Software Developers are required to have the following guidelines set in their software for customers
entering a payment settlement date, (ELC_AUTH_EFCTV_DT) for ACH debit payments:

    •   Not allow a payment settlement date earlier than the submission date, or
    •   Not allow a payment settlement date later than the due date, if the filing is on or before the due
        date, or
    •   Not allow a payment settlement date later than the submission date, if the filing is after the due
        date.

Software vendors who are found to be in violation of the above noted guidelines for ACH debit payment
settlement dates will have their approvals to e-file NYS Corporation Tax returns, extensions and
payments revoked, until proof of compliance is verified.



 




Tax Year 2010 Publication 115                -9-                                          11/4/2010
Contact Information 

Telephone Numbers:

NYS e-Filing Help Desk:         (518) 457-6387
IRS e-Filing Help Desk:         1 866 255-0654

Forms and Publications: To order NYS forms and publications:
All callers:               (518) 457-5431
Or visit our NYS Tax & Finance website: www.nystax.gov

Corporation Tax Information Center
All callers:             (518) 485-6027

Miscellaneous Business Tax Info Center:
All callers:              (518) 457-5735

IRS Business Tax Inquiries:            1 800 829-4933

Tax Practitioners Hotline              (518) 457-5451

Hotline for the hearing and speech impaired:
If you have access to a telecommunications device for the deaf (TDD), contact us at:

All callers:                           (518) 485-5082


If you do not own a TDD, check with independent living centers or community action programs to find
out where machines are available for public use.

Persons with disabilities:
In compliance with the Americans with Disabilities Act, we will ensure that our lobbies, offices,
meeting rooms, and other facilities are accessible to persons with disabilities. If you have questions
about special accommodations for persons with disabilities, please call:

All callers                             (518) 457-5342


e-file contact information

Mailing Address:        NYS Department Tax & Finance
                        E-File Program – Corporation Tax
                        WA Harriman Campus
                        Albany, NY 12227

Email address:          efile@nystax.gov

FAX:                    518 457-8218




Tax Year 2010 Publication 115               - 10 -                                       11/4/2010
Participation Requirements 
Requirements to Participate in the Corporation Tax e-file Program:

Tax Preparers must have a valid EFIN issued by the IRS. Return transmitters must have a valid ETIN
issued by the IRS. To obtain an EFIN or ETIN, you must apply and be accepted as an Authorized IRS
e-file provider by the IRS. For more information on the application process refer to Publication
3112, IRS e-file Application and Participation. The quickest way to receive an EFIN or ETIN is to apply
online. To apply or for more information, go to:
http://www.irs.gov/taxpros/article/0,,id=109646,00.html

A separate Corporation Tax e-file application is not required for New York State.

Who can participate in e-file?
Tax professionals and transmitters authorized to e-file federal corporate tax returns that are using
software approved by IRS and NYS Tax Department can e-file New York Article 9-A corporate tax
returns. Corporations (self filers) acting as an Electronic Return Originator (ERO), can prepare and e-file
the returns themselves without going through a paid preparer.

Responsibilities of e-filers
All participants in the NYS program must comply with the procedures, requirements, and specifications
in the IRS Publication 3112, IRS e-File Application and Participation; IRS Publication 4164
Modernized e-File Guide for Software Developers and Transmitters; and set forth in NYS Publications
115 and 116.

All return filers must:

Use IRS and NYS approved tax software

Corporate self filers must:

Enter the name of the person completing the return and certify to NYS that the data is true, correct, and
complete, and authorize any electronic payment that is included in the filing.

All authorized Electronic Return Originators (EROs) must:

   •   Identify the paid preparer, if applicable, in the appropriate field.
   •   Have the authorized corporate officer sign a New York State Signature Authorization form TR-
       579-CT for the tax year being filed, and retain this form for a period of three years. Do not
       submit Form TR-579-CT to NYS unless requested to do so. Do not use this form when e-filing
       extensions. A copy of the document is available in this publication.
   •   If there is an electronic payment being made with an extension, have the authorized corporate
       officer sign a New York State Signature Authorization form (TR-579.1-CT) for the tax year
       being filed, and retain this form for a period of three years. Do not submit the Form TR-579.1-
       CT to NYS unless requested to do so. A copy of the document is available in this publication.
   •   Furnish the taxpayer with copies of all e-filed forms and schedules.
   •   Include the ERO identification on the return.
   •   Not charge a customer an additional amount for e-file of a NYS tax document.

Tax Year 2010 Publication 115              - 11 -                                       11/4/2010
All authorized Software Developers must:

   •   Allow “linked” and “unlinked” state return
   •   Allow re-transmissions of rejected and then corrected returns
   •   Correct any software errors identified during production
   •   Provide the software ID within each filing
   •   Not charge a separate fee for e-file
   •   Not sell one version of their software that charges for e-file and another version that does not.
   •   Adhere to the guidelines for ACH debit payment settlement dates

Additional Responsibilities

Confidentiality

Developers must conform to all IRS security requirements. For more information on the IRS security
requirements see http://www.irs.gov/efile/article/0,,id=201195,00.html.

Penalties

New York State Tax Law, Section 202.1, Section 211.8, Section 1467, Section 1518 and Section 1825
prescribe penalties for violation of confidentiality of taxpayer information requirements. Refer to
Section 1085(s) as well as 1085(l) regarding violation penalties on tax return preparers.

Advertising standards

An Authorized IRS e-file Provider must comply with the advertising and solicitation provisions of 31
C.F.R. Part 10 (Treasury Department Circular No. 230). This circular prohibits the use or participation
in the use of any form of public communication containing a false, fraudulent, misleading, deceptive,
unduly influencing, coercive, or unfair statement of claim. A Provider must adhere to all relevant
federal, state, and local consumer protection laws that relate to advertising and soliciting.

The guidelines in the IRS Revenue Procedure must be followed for the NYS program as though
references to Internal Revenue Service and Service were references to the New York State Department of
Taxation and Finance, New York State, or the State; and references to the Financial Management
Service or Treasury Seals were references to the State of New York Seal.
See IRS Publication 3112 at http://www.irs.gov/pub/irs-pdf/p3112.pdf




Tax Year 2010 Publication 115              - 12 -                                        11/4/2010
Additional Software Developer Requirements 

Software Developers must:

   •   Immediately correct software errors identified by the IRS/NYS Tax Department and distribute
       updates of their software packages to their clients. Failure to correct any errors or issue timely
       releases may result in suspension from the program.
   •   Notify New York State immediately of any software errors identified during the filing season.
   •   Provide instructions to guide taxpayers and tax return preparers in fulfilling the signature
       requirements. Software Developers must ensure that their software enables the printing of the
       Signature Authorization Forms TR-579-CT and CT-579.1-CT.
   •   Determine whether a payment is an IAT. If the payment is an IAT the return may not be e-filed.
   •   Ensure that their software supports electronic payment options and any electronic funds
       withdrawal information – settlement date and routing/account numbers.
   •   Ensure their software supports the printing of the tax return and all supporting forms to allow the
       corporation to mail their return if the return cannot be e-filed. Refer to Publication 76,
       Specifications for Reproduction of New York State Corporation Tax Forms regarding printing
       supportable forms.
   •   Provide the following DTF instructions in their software during the filing process to alert self-
       filers of New York States mandated e-file requirement. These instructions are not required if the
       software is primarily marketed to tax professionals who prepare returns on behalf of a client.
       The following language must be displayed to self filers:

       Beginning January 1, 2009, corporations must electronically file Article 9-A General
       Business and Sub Chapter S corporation tax returns, and all Article 9, Article 9-A, Article
       13, Article 32 and Article 33 extensions. The mandate also requires the balance due on
       these returns and extensions to be paid electronically.

       You must e-file and e-pay if the return or extension is eligible for e-file, and you meet all
       three of the following conditions:

         •   you don’t use a tax return preparer for your Article 9-A general business
             corporation and S corporation tax returns and Article 9, Article 9-A, Article 13,
             Article 32 and Article 33 extensions
         •   you use tax preparation software that has been approved by New York State for e-
             filing corporation tax returns and extensions
         •   you have broadband internet access

       To learn more about the business tax e-file mandate, visit the New York State Tax
       Department’s Web site: www.nystax.gov”



                                 




Tax Year 2010 Publication 115               - 13 -                                        11/4/2010
Websites and Publications 




New York State Websites –
NYS E-File Website:
http://www.tax.state.ny.us/elf/

NYS Forms and Instructions:
http://www.tax.state.ny.us/forms/default.htm

NYS Corporation Tax e-Filing – Software Developer Testing Package
http://www.tax.state.ny.us/elf/swd_corporation.htm

NYS Dept Tax & Finance – Taxpayer Answer Center
http://www.tax.state.ny.us/faq/

NYS Corporation Tax Publications:
http://www.tax.state.ny.us/pubs_and_bulls/publications/corporation_pubs.htm

NYS Tax Guide to New Businesses:
http://www.tax.state.ny.us/pdf/publications/multi/pub20_1007.pdf

NAICS Code:
http://www.tax.state.ny.us/pdf/publications/general/pub910.pdf

NYS Subscription Service
http://www7.nystax.gov/SUBS/subHome.jsp

Internal Revenue Service:
http://www.irs.gov

IRS Forms and Publications:
http://www.irs.gov/formspubs/index.html?portlet=3

NACTP – National Association of Computerized Tax Processors
http://vps3502.inmotionhosting.com/~nactpo5/

IRS Frequently Asked Questions for Modernized E-File
http://www.irs.gov/businesses/article/0,,id=133980,00.html




Tax Year 2010 Publication 115           - 14 -                                11/4/2010
Publications

•   Publication 3112, IRS e-file Application and Participation – contains information about the roles of
    software developers, transmitters and electronic return originators. IRS has standardized the
    information for all e-file programs.
•   Publication 4162, Modernized e-File Test Package for Forms 1120/1120S – contains the
    instructions and test case scenarios for software developers and transmitters to use for Assurance
    Testing System (ATS) of 1120/1120S. This publication also contains the instructions and test case
    scenarios for Form 7004, Application for Automatic Extension of Time to File Corporation Income
    Tax Return.
•   Publication 4163, Modernized e-File Information for Authorized IRS e-file Providers of Forms
    1120/1120S – contains specific information applicable to 1120, 1120S and 7004 e-file programs
    only.
•   Publication 4164, Modernized e-File Guide for Software Developers and Transmitters, contains the
    communication procedures, transmission formats, business rules and validation procedures to be
    used by software developers and transmitters to develop software for filing electronic 1120/1120S
    returns and 7004 extensions.
•   Publication 4205, Modernized e-File Test Package for Exempt Organization Filings – contains the
    instructions and test case scenarios for software developers and transmitters to use for Assurance
    Testing System (ATS) of Forms 990, 990-EZ, 990-PF, 1120-POL, and 8868.
•   Publication 4206, Modernized e-File Information for Authorized IRS e-file Providers for Exempt
    Organization Filings – contains specific information applicable to Forms 990, 990-EZ, 990-PF,
    1120-POL, and 8868 e-file programs only.
•   “IRS e-file For Large Taxpayers Filing their Own Corporation Income Tax Return” contains
    guidance for corporations that prepare their own income tax return. This document is intended to
    assist corporations with their transition from preparing a paper return to electronic filing.




Tax Year 2010 Publication 115              - 15 -                                      11/4/2010
e­File Corporation Tax Forms Supported for Tax Year 2010  
Accepted in XML 
Form Number      Form Name
CT-3             General Business Corporation Franchise Tax Return
CT-3-ATT         Schedules B, C, D, and E – Attachment to Form CT-3
CT-3-S           New York S Corporation Franchise Tax Return
CT-3-S-ATT       Schedules A, B, C, D, and E – Attachment to Form CT-3-S
CT-3M/4M         General Business Corporation MTA Surcharge Return (Must be filed with CT-3 or CT-4)
CT-3-A           General Business Corporation Combined Franchise Tax Return
CT-3-A/C         Report by a Corporation Included in a Combined Franchise Tax Return
CT-3-A/ATT       Schedules A, B, and C – Attachment to Form CT-3-A
CT-4             General Business Corporation Franchise Tax Return Short Form
CT-5             Request for Six-Month Extension to File (franchise/business taxes, MTA surcharge, or both)
                 Request for Additional Extension of Time to File (for franchise/business taxes, MTA surcharge,
CT-5.1
                 or both)
                 Request for Six‑Month Extension to File (for combined franchise tax return, or combined MTA
CT-5.3
                 surcharge return, or both)
CT-5.4           Request for Six-Month Extension to File New York S Corporation Franchise Tax Return
CT-5.9           Request for Three-Month Extension To File (for Article 9 tax return, MTA surcharge, or both)
                 Request for Three-Month Extension To File Form CT-186-E or Form CT-186-EZ (short form) (for
CT-5.9E
                 telecommunications tax return and utility services tax return)
CT-34-SH         New York S Corporation Shareholders’ Information Schedule
CT-38            Minimum Tax Credit
CT-43            Claim for Special Additional Mortgage Recording Tax Credit
CT-46            Claim for Investment Tax Credit
CT-46-ATT        Credit for Rehabilitation Expenses for Retail Enterprises and Historic Barns
CT-47            Claim for Farmers’ School Tax Credit
CT-222           Underpayment of Estimated Tax By a Corporation
CT-245           Maintenance Fee and Activities Return For a Foreign Corporation Disclaiming Tax Liability
CT-400           Estimated Tax for Corporations
DTF-686          Tax Shelter Reportable Transactions




Tax Year 2010 Publication 115                 - 16 -                                            11/4/2010
Accepted as “.pdf” attachments
Form Number       Form Name
CT-3-A/B          Subsidiary Detail Spreadsheet – Attachment to Form CT-3-A
CT-3-B            Tax-Exempt Domestic International Sales Corporation (DISC) Information Return
CT-3-C            Consolidated Franchise Tax Return for corporate shareholders of tax-exempt domestic
                  international sales corporations (DISCs)
CT-50             Combined Filer Statement for Existing Groups
CT-51             Combined Filer Statement for Newly Formed Groups Only
CT-60-QSSS        Qualified Subchapter S Subsidiary Information Schedule
CT-324            Schedule of Optional Depreciation on Qualified New York Property
CT-399            Depreciation Adjustment Schedule
CT-600            Ordering of Corporation Tax Credits
DTF-625           Low-Income Housing Credit Allocation and Certification
DTF-627           Low-Income Housing Credit Surety Bond
DTF-627.1         Low-Income Housing Credit Collateral Security
DTF-686-ATT       New York Reportable Transaction Disclosure Statement and Request for a Determination
N/A               Attachments listing details of repeating elements (e. g. <EntityInvestmentCapital>)



2010 Tax Year e­File Calendar 
NYS Corporation Tax e-filing program calendar
Corporation tax return period             January 1, 2010 through December 31, 2010
Software testing period                   November 2010 through June 2011
e-file return acceptance period           January 3, 2011 through December 2013

Note: NYS uses the same e-file calendar (start and end dates) as the IRS.



Software Acceptance, Testing and Approval 
The following information must be provided to department prior to submitting test transmissions:
• Software developer company name
• Address
• Primary Contact person – name, telephone number, email address
• Secondary Contact person – name, telephone number, email address
• EFINs/ETINs (test and production) assigned by Internal Revenue Service
• Tax Year 2010 New York State forms supported for Corporate E-File
• Software ID
• Software Product Name

The information should be emailed to: efile@nystax.gov




Tax Year 2010 Publication 115                 - 17 -                                           11/4/2010
New York State Software Testing will begin in November 2010 for Tax Year 2010

All software must be tested using the New York State test package. The Corporation tax e-file test
package will be released in November 2010

Download the New York State Software Developers Package from the following link:
http://www.tax.state.ny.us/elf/swd_corporation.htm

For more information refer to:
Publication 76, Specifications for Reproduction of New York State Corporation Tax Forms


Software Developers will be given confirmation by email from the New York State e-file Section when
software has been successfully tested and approved. Only approved software may be released and
distributed by the developer.

The developer and test packages include:

•   Version number of Schema
•   State Specific XML Schema
•   State Spreadsheet of required data elements
•   PDF copies of State test returns
•   Spreadsheets of any special test conditions

Developers must validate the New York State return data (XML) against the New York State Schema,
and include edits and verifications based on the business rules provided for each element. The
department’s state spreadsheet will include information on field type, field format, length, if it can be
negative, if it is recurring, and the business rule or other edits and verifications for each field.

Acknowledgement System  
All transmitted returns received by New York State (NYS) will generate a submission receipt and an
acceptance /rejection acknowledgement to IRS for every NYS return received. The submission receipt
indicates that the transmission was received by NYS and an acknowledgement indicates whether or not
the return has been accepted or rejected. An Accepted acknowledgement record indicates the return was
received and will be processed by New York State.

IRS action on a State submission  

New York State will support “linked” and “unlinked” state returns. If the State submission is linked to
an IRS submission (also referred to as a Fed/State return), the IRS will check to see if there is an
accepted IRS submission under that Submission ID. If there is not an accepted federal return, the IRS
will deny the State submission and a deny acknowledgement will be sent. NYS will not know that the
transmitter has sent a state submission to MeF in this case. If there is an accepted federal return
under that Submission ID, then MeF will validate certain elements on the State submission. If IRS does
not deny the state return, it will provide the State submission to NYS. If the State return is not linked to
a previously accepted federal return (also referred to as State Stand-alone Return), then MeF will
validate certain elements of the submission. If IRS does not deny the state return, it will provide the
State submission to New York.


Tax Year 2010 Publication 115               - 18 -                                        11/4/2010
State receipt and acknowledgment 

NYS will retrieve the state submission from the IRS, and send a submission receipt back to the IRS
immediately. NYS will then validate the XML data and apply validation rules to the return and an
acknowledgment (indicating accept or reject) will be sent back to the IRS within 3 business days. The
transmitter may retrieve the transmission receipt and/or acknowledgment from the IRS. An accepted
acknowledgement indicates the return and payment (if applicable) was received and has successfully
completed the validation process. The acknowledgment does not indicate the return or extension has
completed processing through all business rules. In addition, it does not ensure that NYS will pay a
refund as requested. A rejected acknowledgment indicates the return or extension has failed to complete
the validation process. A rejection acknowledgement will contain error codes indicating the cause of the
rejection. A list of the pre-entry validation error codes has been provided in the ‘Error Categories –
Business Rules’ section of this Publication. An accepted acknowledgement does not indicate the funds
associated with an authorized payment have been received.




Resubmission of NYS rejected return/extension 

If a state return or extension is rejected by NYS due to an error, the error can be corrected and the return
or extension can be re-submitted. If the corrected electronic return/extension can be retransmitted, the
re-submitted return must contain the original submission ID of the rejected return/extension in the field
named ORIG_SBMSN_ID.


Processing delays 


The Tax Department will make every effort to quickly process an e-filed return once an accepted
acknowledgement is issued. However, the return may require manual review if exceptions are
encountered when it processes through all the business rules.


 
Payment Handling and Acceptance 
Paying a balance due

NYS allows 3 options to pay electronically filed Corporate Income Tax returns and extensions:

    •   ACH Debit included with the filing data when the document is electronically filed
    •   ACH Credit initiated by the taxpayer through their own bank
    •   By check or money order utilizing the payment voucher (CT-200-V)


 

Tax Year 2010 Publication 115               - 19 -                                        11/4/2010
ACH Debit 

The information necessary to initiate the ACH debit must be included with the filing data when the
document is filed. Filers can indicate a payment date up to and including the due date of the return or
extension. Partially paid or unpaid liabilities on an e-filed document will be billed when the return is
processed. A balance due on an e-filed extension will not be billed and must be paid in full when the
extension is filed to avoid interest and penalties from being assessed and to insure the extension is valid.

Preparers and ERO’s must stress to taxpayers the importance of supplying correct information because
the routing transit number and bank account number may not be changed once a return or extension has
been transmitted and accepted.

Returns can be submitted with full payment, partial payment or no payment. Any balance due will be
billed when the return is fully processed. An unpaid extension will be considered invalid and will result
in assessed interest and penalty when the return is filed.

The taxpayer may specify an electronic funds withdrawal date. The date specified by the taxpayer is the
earliest date the electronic funds withdrawal will be debited from the specified account. The filer can
specify a payment date up to and including the due date of the return, without regard to an extension.
This payment option is available through the end of the e-file season. Note: If a payment date falls on a
weekend or bank holiday, the payment will be withdrawn the next business day.

Software developers are required to determine if payments are IATs. If the user indicates the payment is
an IAT, the user should be instructed to file the document on paper and pay by way of paper instrument.
If the software developer chooses to transmit a document with a known IAT, the IAT Indicator element
(IAT_IND) must be populated with a “yes” and the submission will be rejected.


The following information should be present for returns/extensions containing ACH debit payments:
   • BANK_ACCT_NMBR (Bank account number)
   • ABA_NMBR (Bank routing number)
   • ACCT_TYPE_CD (Account type: 1 = checking, 2 = savings)
   • ELC_AUTH_EFCTV_DT (Requested settlement date)
   • TOT_PYMNT_AMT ( Total payment amount)
   • ACCT_HLDR_TYPE_IND (1= business, 2 = personal)


Software Developers must not allow customers to enter a payment settlement date:

    •   Earlier than the submission date, or
    •   Later than the due date, if the return is filed on or before the due date, or
    •   Later than the submission date, if the return is filed after the due date.

Software vendors who are found to be in violation of the above noted guidelines for ACH debit payment
settlement dates will have their approvals to e-file NYS Corporation Tax returns, extensions and
payments revoked until proof of compliance is verified.

 

 

Tax Year 2010 Publication 115                - 20 -                                       11/4/2010
ACH Credit 

Taxpayers may pay for their electronically filed Corporation Tax returns and extensions by ACH Credit.
The taxpayer must initiate the ACH credit through their bank or financial institution, which then sends
the payment to the NYS Tax Department. In order for the payment to be considered timely, it is the
responsibility of the taxpayer to insure that the payment is processed and received by the NYS Tax
Department no later than the due date.

More information on ACH Credit processing can be found at:

http://www.tax.state.ny.us/sbc/ctwebfile.htm




Payment Voucher (CT­200­V) 

Starting with Tax Year 2010 returns, NYS will now support Form CT‐200‐V, Payment Voucher for 
E‐Filed Corporation Tax Returns.  
 
E‐Filers may now use Form CT‐200‐V to mail in a check or money order to make payments for 
their e‐filed returns, extensions and estimated payments.  Form CT‐200‐V should ONLY be used to 
make payments for e‐filed returns/extensions and should NOT be used to send in a payment for 
any paper filed return/extension. Software must limit the printing of the voucher to documents 
that are e‐filed by the customer. 
 
 
Form CT‐200‐V should be able to be created at the time the software user completes entering their 
return information. Should they choose to mail in a check or money order to make their payment, 
the software should include instructions to print out the form and mail it in along with their 
payment. The software must populate all fields, except the amount of the payment. Form CT‐200‐V 
should be sent to NYS with the enclosed payment and nothing else attached. There is no need to 
write any additional information on the form, attach a copy of the return data or attach a letter of 
explanation. The effective date of the payment will be the postmark date, if the payment is 
postmarked on or before the due date. If it is postmarked after the due date, the effective date of 
the payment will be the date it is received.  

 

Common questions about an electronic funds withdrawal (direct debit) 

How is an electronic funds withdrawal initiated?

The tax preparer/corporate officer will authorize an electronic funds withdrawal through the tax
preparation software being used. The filer must provide the ABA bank routing number, account number,
type of account, business or personal account, authorized payment amount and requested withdrawal
date.




Tax Year 2010 Publication 115             - 21 -                                     11/4/2010
What information is needed to make an electronic funds withdrawal payment and how is the
information used once the return is e-filed?

A bank account number and the routing transit number of the financial institution the withdrawal is
being made from. The routing number is the nine-digit number located at the bottom of a check. The
electronic funds withdrawal information including the requested date of debit, the payment amount, and
the checking or savings account information indicated will be used only for the one tax payment
authorized.

Will a partial payment be accepted?

Yes, partial payment will be accepted for returns. However, the corporation will be billed for the
remaining amount owed, including interest and penalties. In addition, the payment amount cannot be
greater than balance due amount on return. Extensions must be ‘paid in full’ or they will be considered
invalid. Extensions are a request for late filing, not late payment.


If the electronic funds withdrawal option with delayed payment is chosen, what assurance is given
the money won’t be withdrawn sooner?

If a return is e-filed before the due date, the specified payment amount will be debited from the account
on the date specified, or the due date of the return. The specified date cannot be later than the due date.
If the return is e-filed after the due date authorizing an electronic funds withdrawal, the electronic funds
withdrawal will be processed on the date the e-file return is accepted. Note: If a payment date falls on a
weekend or bank holiday, the payment will be withdrawn the next business day.

Can an electronic funds withdrawal be made after the due date?

An authorized electronic funds withdrawal will be accepted with a return or extension. If the return or
extension is e-filed after the due date, the balance authorized electronic funds withdrawal will be
processed at the time the return or extension is processed.

What will the tax preparer/corporate officer receive from the State of New York as confirmation
of the electronic funds withdrawal payment?

The confirmation is the copy of the e-filed return that includes the electronic funds withdrawal
authorization and the bank statement that includes a NYS Tax Payment line item.

What if later I want to change my designated payment date or cancel my payment?

Once the e-filed return is accepted, the designated payment date cannot be changed and the payment
cannot be cancelled.




Tax Year 2010 Publication 115               - 22 -                                        11/4/2010
Signature Requirements for Corporate e-File Documents

New York State has adopted new signature requirements for self–filers and Electronic Return
Originators (ERO)/Preparers and no longer utilizes the Scanned Forms Option or the Preparer PIN
Option. Software Developers must support both the self-filer and the ERO/preparer signature
requirements. This will require the software to display certification language for different filing
scenarios along with a checkbox for the filer to check which indicates they have read and agree to the
contents of the text. The software must not pre-populate the checkbox; it must be checked by the filer
since it acts as the electronic signature for the return. This is a requirement for the following filing
scenarios:

•   A return being filed by a ERO/Preparer
•   An extension, with a payment, being filed by a ERO/Preparer
•   A return that is being self-filed by a corporation
•   An extension, with a payment, that is being self-filed by a corporation

It is not required that the software provide a hard copy of the certification to the filer, only that it be
displayed to the filer for each electronically filed return and extension with payment. However, there are
two forms, the TR-579-CT and TR-579.1-CT that must be generated on paper. These forms are
necessary for the ERO/Preparer to obtain an original ink signature for the e-filed return or extension, and
keep for their records for a period of three years.

The following pages include the certification language the software must display and drafts of the forms
the software must allow to be printed.
                                 




Tax Year 2010 Publication 115              - 23 -                                       11/4/2010
ERO/Preparer Signature Requirement for e­file Returns  

This option includes display of certification language and creation of a signature form TR-579-CT, New
York State Signature Authorization for Tax Year 2010 For Forms CT-3, CT-3M/4M, CT-3-S,CT-4, CT-
3-A, CT-245 or CT-400 (see next page). This form must be printed and prepared by the ERO/Preparer;
and be signed by both the taxpayer and the ERO/Preparer for every e-filed corporation tax return. In
addition, the certification language must include the checkbox the ERO/Preparer must check certifying
that the language has been read and agreed to.


The certification language that must be displayed is as follows:

ERO/ Preparer Certification and Signature

I certify that I have a valid New York State E-File Signature
Authorization for Tax Year 2010 (Form TR-579-CT), authorizing me to
sign and file this return on behalf of the corporation. I further
certify that all information provided on the return is true, correct
and complete to the best of my knowledge and belief, and that I have
provided a copy of this return to the corporation. If financial
institution account information has been provided on the return, I
certify that the corporation has agreed to payment of the amount
indicated as due by electronic funds withdrawal, that the corporation
has authorized the New York State Tax Department and its designated
financial agents to initiate an electronic funds withdrawal from the
indicated account, and that the designated financial institution is
authorized to debit the entry to the corporation’s account. By
checking the box shown below, I understand and agree that I am
electronically signing and filing this return.

       I have read the certification above and agree



                           




Tax Year 2010 Publication 115               - 24 -                                   11/4/2010
Tax Year 2010 Publication 115   - 25 -   11/4/2010
 Electronic Return Originator (ERO) Signature Requirement for Extensions  

This option includes display of certification language and creation of a signature form TR-579.1-CT,
New York State Authorization for Electronic Funds Withdrawal For Tax Year 2010 Forms CT-5, CT-
5.3, CT-5.4, CT-5.9 & CT 5.9E(see next page). This form must be printed and prepared by the ERO; and
be signed by both the taxpayer and the ERO for every e-filed extension authorizing an electronic funds
withdraw. In addition, the certification language must include the checkbox for the ERO to check
certifying that the language has been read and agreed to.


The certification language that must be displayed to the ERO is as follows:

ERO/ Preparer Certification and Signature

By checking the box below, I certify that I have a valid New York
State Taxpayer Authorization Electronic Funds Withdrawal for Tax Year
2010 for Extensions CT-5,CT-5.3,CT-5.4, CT-5.9 or CT-5.9E,(Form TR-
579.1-CT), authorizing me to submit this extension on behalf of the
taxpayer(s). I certify that the taxpayer(s) has agreed to payment of
the amount indicated as due by electronic funds withdrawal, that the
taxpayer(s) has authorized the New York State Tax Department and its
designated financial agents to initiate an electronic funds
withdrawal from the indicated account, and that the designated
financial institution is authorized to debit the entry to the
taxpayer’s account.

       I have read the certification above and agree




Tax Year 2010 Publication 115               - 26 -                                  11/4/2010
                                                          
 


    Tax Year 2010 Publication 115   - 27 -   11/4/2010
Self­filer Signature Requirement for Returns  

This option includes the certification language that must be displayed to the self filer for each e-filed
return. The certification language must include a checkbox (as shown below) which the self-filer must
check to allow the return to be electronically transmitted to NYS. By checking the box, the self-filer is
certifying the language has been read and agreed to.

The certification language that must be displayed to the self-filer is as follows:

Self-Filer Declaration and Signature

I declare, under penalty of perjury, that I have examined the
information on this New York State electronic corporation tax return
(hereafter, “return”), including any accompanying schedules,
attachments, and statements, and certify that this electronic return
is true, correct, and complete.

If an amount owed on this return is being paid by electronic funds
withdrawal, I authorize the New York State Tax Department and its
designated financial agents to initiate an electronic funds
withdrawal from the indicated account, and I authorize the financial
institution to debit the entry to the account.

By entering my name and checking the box shown below, I declare that
I am an authorized officer of this corporation, that I am authorized
to sign and file this electronic return on behalf of the corporation,
and am in fact signing and filing this return.


____________________
Enter Name

       I have read the certification above and agree

                                 




Tax Year 2010 Publication 115               - 28 -                                      11/4/2010
Self­filer Signature Requirement for Extensions  

This option includes certification language that must be displayed to the self-filer for each e-filed
extension that includes an electronic payment. The certification language must include a checkbox (as
shown below) which the self-filer must check to allow the extension to be electronically transmitted to
NYS and the payment debited from the specified account. By checking the box, the self-filer is
certifying the language has been read and agreed to.

The certification language that must be displayed to the self-filer is as follows:

Self-Filer Certification and Signature

If an amount owed on this extension is being paid by electronic funds
withdrawal, I authorize the New York State Tax Department and its
designated financial agents to initiate an electronic funds
withdrawal from the indicated account, and I authorize the financial
institution to debit the entry to the account.

By entering my name and checking the box shown below, I declare that
I am an authorized officer of this corporation, and that I am
authorized to submit this extension and any associated financial
transaction.


____________________
Enter Name

       I have read the certification above and agree
                                 




Tax Year 2010 Publication 115               - 29 -                                     11/4/2010
General Information 
Business tax e­file mandate for tax return preparers 

Starting January 1, 2011 

    •   Clients can no longer opt-out of e-file. Form TR-800 Taxpayer Opt-Out and Reasonable Cause Record for
        Tax Return Preparers has been eliminated.
    •   If you have reasonable cause to not e-file, you must maintain adequate documentation. You will need to
        provide that documentation to us if you receive a penalty bill for failing to e-file.
    •   You cannot charge a separate fee for e-file.
    •   You can pay the balance due on an e-filed corporation tax return or extension for tax year 2010 with a
        voucher and check, direct debit from a bank account, or an ACH credit initiated by the taxpayer from
        their bank account.

Who mandate applies to 

You must e-file all general business and New York State S corporation returns (Article 9-A) and extensions
(Articles 9, 9-A, 13, 32 and 33) and e-file all monthly sales tax returns (ST-809 and ST-810) and PrompTax sales
tax returns (Form ST-810) if you're a tax return preparer and:

    •   You were subject to the mandate in a previous period, or
    •   You meet both of the following conditions:
           o You prepared more than 100 combined original sales tax and corporation tax documents in
              calendar year 2010, including tax documents for prior periods; and
           o You use tax software to prepare one or more sales tax or corporation tax documents in 2011.

You're a tax return preparer if you prepare any return or claim for refund for compensation, or you receive
compensation for returns or claims for refund prepared by people that you employ or engage.

You're subject to the e-file mandate even if you're located outside of New York State.

To determine if you meet the 100 return threshold

    •   Count tax documents at the entity level; include all of the returns prepared by you and all members or
        employees of your firm. If your business has multiple locations, use the combined total for all locations.
    •   Count all of the New York corporation tax and sales tax documents that you filed in calendar year 2010.
        You must include extensions, amended returns, returns for prior years, estimated tax payments and any
        other New York tax documents, even if they are not subject to the mandate and cannot be e-filed.

You're responsible for determining whether or not you're subject to the mandate.

Once you're subject to the mandate, it continues to apply to you in all following years, even if you no longer meet
the 100 document threshold.



 




Tax Year 2010 Publication 115                  - 30 -                                           11/4/2010
How to comply with the mandate 

New York State corporation tax returns and extensions 

    •   You can use approved software to e-file your New York State corporation tax returns and extensions. If
        your software doesn't support e-file, you must get approved e-file software. You'll need to: have an
        Electronic Filer Identification Number (EFIN) issued by the IRS and be authorized to e-file the equivalent
        federal returns.
    •   You must e-file extensions for Article 9, 9-A, 13, 32 and 33, even if the subsequent return cannot be e-
        filed.
    •   Provide e-file corporation tax return transaction detail. Enter each transaction into the software, import the
        data if your software allows it, or transmit a pdf attachment that includes the detail with the e-filed return.
    •   We don't support the e-filing of certain corporation tax returns and required attachments. However, you
        must still e-file the extension for those returns if supported by your software.
    •   You may also Web File certain corporation tax extensions by creating an Online Services account.




New York State sales tax returns 

    •   Create an Online Services account and gain access to your client accounts
    •   Log in and select Sales Tax Web File

 

Penalties 

    •    A $50 penalty applies to each e-fileable return or extension that you fail to e-file, unless you have
        reasonable cause for not doing so.
    •   A $500 penalty applies to the first time you charge a separate e-file fee. A $1,000 penalty will apply to
        each subsequent occurrence. This penalty will apply to tax documents filed after December 31, 2010.




You can find additional information at www.tax.state.ny.us/elf/tp_busn_mandate.htm




Tax Year 2010 Publication 115                   - 31 -                                            11/4/2010
Business Tax E­file Mandate for Self­Filers  

A corporation must e-file all Article 9-A General Business and Sub Chapter S corporate tax returns and
extensions if the corporation meets all three of the following conditions:

    •   does not use a tax return preparer to prepare the corporations Article 9-A General Business or
        Sub Chapter S corporate tax return;
    •   uses tax preparation software that has been approved by New York State for e-filing Article 9-A
        and Sub Chapter S corporation tax returns; and
    •   has broadband internet access.

You can find additional information at www.tax.state.ny.us/elf/elf_busn_mandate.htm

 

Exclusions from New York State Corporation Tax e­File 

NYS follows the IRS guidelines for MeF exclusions (Refer to IRS Publication 4164).
In addition to the IRS guidelines, NYS the following documents may not be filed:


    •   returns filed for a tax liability period ending prior to January 1, 2008 
         

International ACH Transactions (IAT) 

New York will not support International ACH Transactions (IAT). Software developers are required to
determine if payments are IATs.

If a software user is making an ACH payment, the software developer must ask the user:

  “Will the funds for this payment come from an account outside the
United States?”   
 
If the user indicates the payment is an IAT the user should be instructed to file the document on paper
and pay by way of paper instrument. If the software developer chooses to transmit a document with a
known IAT, the IAT Indicator element (IAT_IND) must be populated with a “yes” and the submission
will be rejected.

Issuers Allocation Percentage 

 Submissions of a CT-3 or CT-3S must have a value entered for the issuer’s allocation percentage even
if the value is zero. If a value is not entered the taxpayer may be assessed penalty. The tags used for
the issuer’s allocation percentage for each form are:

    •   For the CT‐3, <ISS_ALLOC_PCT> 
    •   For the CT‐3‐S, < S_ISS_ALLOC_PCT > 

Tax Year 2010 Publication 115                - 32 -                                    11/4/2010
Foreign Country Codes 

NYS uses the Foreign Country Codes as defined by IRS. They are available at
http://www.irs.gov/efile/article/0,,id=175595,00.html.)

Voluntary Disclosure Program 

The following language must be displayed in all software marketed to self-filers. The language does not
need to appear in packages marketed to tax preparers.

       Do you owe back taxes for prior tax years? You can save
       thousands in penalties under a law that authorizes the New
       York State Tax Department to waive civil and criminal
       penalties for taxpayers who disclose and pay overdue taxes.
       Visit www.nystax.gov to get more information or to apply
       online for the New York State Voluntary Disclosure and
       Compliance Program.


Attaching Non­XML Documents   

New York supports PDF attachments within an e-file submission.

A separate “Binary Attachment XML document” must be created for each PDF and included in the
submission. The PDF must be included in the attachment folder of the submission zip.

Please refer to IRS Publication 4164 for Binary Attachment Submissions and Guidelines

Attaching non-XML documents (PDF files) is different than attaching XML documents. To attach a
PDF file, the following steps must be performed:

1. Create the PDF file.
2. Create a Binary Attachment XML document in the submission data that describes the PDF file.
3. Create references, if any, from the element(s) to which the PDF file is attached to the Binary
   Attachment XML document.
      • If the PDF file is to be attached to an element for a line, form, or schedule, create a reference
          from the element to the Binary Attachment XML document.
      • If the PDF is to be attached to a “GeneralDependency” or
          “GeneralDependencyElection” (i.e. Plans of Merger, Plans of Reorganization) create a
          reference from the element to the Binary Attachment XML document.


It is important to note that the reference is created from the element to the Binary Attachment XML
document, not to the PDF file. If no reference is created to the Binary Attachment XML document, then
the PDF file is considered to be attached to the Submission. It is important to note that creating
reference(s) to PDF files is needed only when the IRS specifies the conditions under which the reference
must be created and where the reference must exist within the return data.




Tax Year 2010 Publication 115              - 33 -                                       11/4/2010
•   Include the number of binary attachments in the submission in the BinaryAttachmentCount attribute,
    which is used to indicate the number of binary attachments in the return, of element ReturnHeader.
•   Include the PDF file in the Submission ZIP file that constitutes the submission.

Note: The ERO or taxpayer can create the PDF file with any tool available. To create the Binary
Attachment XML document, the ERO needs to know the name of the PDF file and a brief description of
(the contents of) the file. The ERO creates one Binary Attachment XML document for each PDF file
included in the submission. There is one-to-one relationship between the PDF file and the Binary
Attachment XML document that describes it.

The ERO or taxpayer provides the name of the PDF file, including the extension, in the
AttachmentLocation element and provides a brief description in the “Description” element of the Binary
Attachment XML document. The schema for the Binary Attachment document is defined in the file
named BinaryAttachment.xsd.

For PDF attachments, the tax preparation software must provide the ERO or taxpayer the ability to enter
a meaningful name. Attachment names are limited to 30 characters for New York State Submissions.
The following table provides a few examples of meaningful names.


                   CONDITION                                  BINARY ATTACHMENT TITLE
If you are required to file Form CT-3-B                 CT-3-B Tax-Exempt DISC Info
If you are required to file Form CT-3-C                 CT-3-C Consolidated DISC
If you are required to file Form CT-60-QSSS             CT-60-QSSS Qual Sub S Sched
If you are required to file Form CT-399                 CT-399 Depreciation Adj Sched

 

Error Categories ­ Business Rules 

Rejected transmissions are now referred to as “Business Rules” and have been restated to be
specific in indentifying the location of the error. The following Error Categories validate the XML data:

•   Multiple Documents – more than the required number of documents are included in the tax return.

•   Missing Documents – a tax return document is required but was not included in the tax return.

•   Data Mismatch – the data in two fields should be the same but is not. For example, if the Investment
    Capital amount (INVCAP_AMT) on CT-3 Line 35 must equal Net Avg Value Investment Capital
    amount (NET_INVCAP_AMT) CT-3-ATT Line 7 and is not equal.

•   Duplicate Condition – the tax return or the transmission file was previously received and accepted
    by the Department.

•   Incorrect Data – data violates a business rule even though it is syntactically correct. That is, the data
    values for elements must conform to the format specified and the data type. Also, the data values for
    elements must contain only values allowed for them in the schema.

•   Missing Data – data is not provided for a required field.



Tax Year 2010 Publication 115                - 34 -                                        11/4/2010
•   Database Validation Error – data provided does not match the IRS database or the data provided
    should be present in the IRS database but is not. (e.g. the Electronic Filing Identification
    Number (EFIN) in the Return Header must be listed in the MeF database and in accepted status.)

•   XML Error – the data violates schema specification. The return and transmission documents must
    conform to the version of the XML schema.

•   System Error – a return encounters a problem with the IRS systems that prevents the return from
    being processed electronically.

Edits and Verifications 

Please refer to the New York State e-file website for Software Developers and download our Tax Year
2010 Software Developer Package: http://www.tax.state.ny.us/elf/swd_corporation.htm


Error Codes - Rejected Corporation Tax Returns Filed for Tax Year 2010

Code       Message                                   Explanation
01136      Valid Liability Period Start Date         Tax period beginning date missing or invalid
           Required
01153      Valid Liability Period End Date           Tax Period ending date missing or invalid
           Required
02707      Liability Period End Date                 Tax year begin > Tax year end
04012      Filing Composition Error                  Invalid filing combination
04015      Form Not Valid For Tax Year               Liability period incorrect
04017      Field Is Not In Range                     Negative value in a positive field
04074      CT ELF Schema Validation Failure          Invalid schema
04075      Invalid Bank Routing Number               Invalid bank routing number
04079      Main Form Check Service Failure           Submission does not contain a main form
04676      ACH Debit > Payment Enclosed              ACH debit amount > payment enclosed amount
04883      Software vendor is not approved           Vendor not approved for e-file
04885      Invalid Format CT34SH Schedule B          Invalid <ShareholderPartner> Format
04998      NewYorkReceipts cannot be negative        New York Receipts cannot be negative


NYS Non-Schema Edits and Business Rules:

Transmission Business Rules

Rule/Validation                                                        Error Category
Federal return required                                                Missing Document
A main form must be included in the filing
   • MTA (CT-3M/4M) must be filed with a main form (CT-3,
       CT-3-A, or CT-4)
                                                                       Missing Document
   • All credit forms and attachments must be filed with a main
       form (CT-3, CT-3-A, or CT-3-S)




Tax Year 2010 Publication 115             - 35 -                                      11/4/2010
    Payment Business Rules

    Rule/Validation                                                     Error Category
    Payment amount cannot be greater than the Payment Enclosed
                                                                           Incorrect Data
    amount on the return (Line A on all main forms and extensions).


    Signature Business Rules

    Rule/Validation                                                     Error Category
    Signature check box(es) is required                                 Missing Document

    Amount Business Rules

    Rule/Validation                                                     Error Category
    NYS accepts whole dollar amounts only                               Incorrect Data

 

Schemas and specifications 

IRS has structured tax return data into a series of schemas. A schema is an XML document that
specifies the data elements, structure, and rules for each form, schedule, document, and/or
attachment. Unless otherwise noted, XML schemas must be used as defined by IRS. Most of the
required elements are in the return header schema. The header schema contains the identifying
information for the entity filing the return, the name of the officer signing the return, preparer
information, and the preparing firm’s information.

Please refer to the New York State e-file website, www.tax.state.ny.us/elf/swd_corporation.htm,
for New York’s schema documentation.




Tax Year 2010 Publication 115                - 36 -                                    11/4/2010

				
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