Tax notices are increasing. Don’t panic, Prepare.

By Scott Schapiro

Tax notices are increasing. Don’t panic, Prepare.

As the business world slowly, or in some cases swiftly, emerges from the stupor of the past year, most of us are going to start encountering changes, both positive and negative, from the ways that we used to do our jobs. Whether working from home, back in the office in a hybrid fashion or fully returned, some things will change, and some will not. One thing that will likely increase will be the inundation of notices, alerts, assessments, liens, etc., that we will receive from the state and local taxing authorities. Just as we struggled to find some normalcy, so did the various tax agencies. And now it is time to play catch-up. Don’t be surprised to see an influx of notices in your mailbox, both physical notices and electronic alerts, covering everything from state unemployment to sales tax to unclaimed property. For example, New York State alone, just within the Department of Taxation and Finance, administers more than 40 state and local tax types, processing 26 million returns annually, including income tax, sales tax, corporate taxes, withholding, and commuter taxes. Now, I know what you’re thinking…that’s New York, of course it’s an enormous number. For comparison, in 2020, the Arizona Department of Revenue processed over 6 million returns, ranging from personal income tax to sales tax to corporate income tax. Yup, no escaping. 

So, what is the common thread here? If tax returns are processed, notices will be issued. Whether they are assessments, account information, rate changes, they are coming. Be prepared and be organized. Centralizing the management of notices can be an efficient tool and can also save money in terms of potential penalties for past due payments, missing deadlines and just plain losing mail. We will explore some specifics in future blogs but consider how best for your organization to manage the coming increase in notices, and whether NOTICENINJA might be able to help. 

 

Written by Scott Schapiro, President EX4 Payroll Consultant and Notice Ninja, Inc. Advisory Board Member

Scott is Founder and President of EX4 Payroll Tax Consultants, LLC, which began serving clients in October of 2020. Prior to starting his own firm, he was with KPMG LLP for 25 years, a principal in KPMG’s Global Mobility Services (GMS) practice for 17 years, and the Principal in Charge of KPMG’s national Employment Tax practice for twelve years. With over 35 years of experience in the federal and state payroll and payroll tax arena, Scott is highly qualified to assist in all matters of employment taxation for organizations of all sizes and industry focus.