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April 2, 2003

DOR Working with Taxpayers to Help Them Comply with e-Filing Law; New Legislation Proposed

TALLAHASSEE - The Florida Department of Revenue (DOR) will work with taxpayers and tax preparers to help them comply with a state law requiring electronic filing and payment of unemployment taxes in April 2003, rather than taking a punitive approach, the Department announced Wednesday.

A 2002 state law requires many taxpayers and tax preparers to begin filing unemployment tax reports and paying unemployment tax electronically starting in April 2003. DOR encourages employers to enroll so they can begin electronically filing unemployment tax reports and paying tax this month. However, approximately 60,000 taxpayers affected by the law have not yet enrolled to use electronic filing methods. The Department anticipates very heavy demand in April for assistance in complying with this new law.

To reduce the burden of tax compliance on taxpayers, tax preparers, and DOR employees, the Department will not impose penalty if taxpayers or tax preparers are not able to comply with the electronic filing and payment requirements for unemployment tax filing for the first quarter of 2003.

Unemployment tax reports (Form UCT-6 ) for the first quarter of 2003 are due April 1 and late after April 30. The law requires employers to file unemployment tax reports and to pay tax electronically if they employed 10 or more employees in any calendar quarter during the previous state fiscal year (July 2001 through June 2002). Tax preparers who prepared and reported unemployment tax for five or more employers also are required to electronically file and pay unemployment tax on behalf of their clients.

Department officials previously have announced that DOR would not impose any penalty if taxpayers are now unable to comply with electronic filing requirements for sales and fuel tax. These requirements began to affect businesses in February 2003.

In addition, the Department urges Florida certified public accountants and other members of the accounting community to closely monitor pending proposals in the current session of the Florida Legislature.

Under a proposal now under consideration in the Legislature, most tax preparers would not be required to enroll to file unemployment tax reports and to pay tax electronically for their clients. If this proposal is adopted by the Legislature:

  • Tax preparers who prepare and file unemployment tax reports for fewer than 100 clients would not be required to file and pay tax electronically on behalf of their clients. Other electronic filing requirements would remain unchanged, including requirements that employers must pay tax and file unemployment tax reports electronically if they employed 10 or more employees in any quarter from July 2001 to June 2002. These employers still would be required to electronically file and pay unemployment tax even if their tax preparers were not obligated to e-file and e-pay.
  • Tax preparers would not be required to use clients' confidential banking information to make payments electronically. Under the 2002 law, some tax preparers might have to have access to clients' debit-card information, credit-card information, automated clearing-house authorization codes or other financial information to make electronic payments. The Florida Institute of CPAs had challenged this requirement, noting that it raised ethical concerns related to the professional independence of CPAs.
  • Penalty for failure to comply with electronic filing requirements would be $10 for every tax report due, rather than a percentage of the amount of tax due.
  • The effective date to require tax preparers to enroll for e-filing systems would be delayed to the second quarter of 2003, to allow tax preparers to get through the 2003 income-tax season without having to implement provisions of the new Florida law.

For information about complying with requirements to file and pay unemployment tax electronically, please call 1-800-482-8293. For information about requirements to file and pay sales, fuel and other taxes electronically, please call 1-800-352-3671 from within Florida. For more information, you may also visit the DOR Internet site at www.myflorida.com/dor/.