PA Issues New Corporate ID Number and Faster Assessments

State and Local Tax

By Cathleen Condrac

Corporate taxpayers should have received a new identification number recently, issued by the Pennsylvania Department of Revenue (Department). The new identification number is the first of many changes to occur as a result of the Department’s implementation of a new integrated tax system (ITS).

As highlighted in a previous Insight, corporation taxes were migrated to the ITS in March 2013. As part of this transition, the Department issued unique identification numbers to corporate taxpayers that will replace the old account (box) numbers traditionally used. In addition to achieving greater efficiency in serving the corporate taxpayer, the ITS allows the Department to automatically generate corporate tax assessments relevant to the electronic funds transfer (EFT) penalty.

Under the current EFT law (implemented in 2012), corporate taxpayers with tax liabilities in excess of $10,000 are required to pay the Department electronically. Failure to do so results in the imposition of a penalty equal to 3% of the total tax, not to exceed $500. Prior to implementation of the ITS, electronic funds transfer penalty assessments were generated manually.

In addition, interest due on underpayments of estimated tax will be enforced for tax year 2013 when the tax return is filed in 2014. The Department is encouraging corporate taxpayers to understand the requirements for quarterly estimated payments in order to avoid unnecessary penalty assessments.

Corporate taxpayers will also see new a new notice, which summaries corporate account overpayments, available credits, transfer notifications and corporate ledger transactions. Since the new overpayment summary notice will only be generated when an overpayment occurs, taxpayers are advised to contact the Department to confirm tax payments and restricted credits on a corporation tax account prior to filing the corporate tax report.

If you have any questions regarding a tax assessment or corporate tax filing and/or payment requirements, contact your state and local tax professional.

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This advice is not intended or written to be used for, and it cannot be used for, the purpose of avoiding any federal tax penalties that may be imposed, or for promoting, marketing or recommending to another person, any tax related matter.

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