New York – Guidance Regarding e-File Mandate for Tax Return Preparers

SALT Report 2571 – The New York Department of Taxation issued a tax bulletin that discusses who is subject to the new e-file mandate for tax return preparers. The bulletin states that tax preparers, both in and out of New York, who meet either one of the following conditions, are required to e-file:

You Prepared Tax Documents for More than 10 Taxpayers

If you or your firm prepared at least one authorized tax document for more than 10 different taxpayers in 2012, and you will use tax software to prepare one or more tax documents in 2013, you are subject to the e-file mandate.

Authorized tax documents subject to the mandate include any document that the Tax Department authorizes to be e-filed. If the document cannot be e-filed, then you do not have to count it to determine if you meet the ten-taxpayer threshold.

You Were Previously Subject to the Mandate

This provision applies to tax professionals who were previously subject to the mandate because they prepared more than five New York State tax documents in 2011. The new efile mandate states that once you are subject to the mandate, you must continue to e-file all of your clients’ tax documents in future years, regardless of the number of taxpayers for which you are preparing returns.

In addition, the bulletin addresses how to set up an e-file account, how to e-file and e-pay, which tax documents are subject to the e-file mandate, and the penalties for noncompliance. Finally, the Department warns that tax preparers are not allowed to charge their clients an e-filing fee.

For Further Information

New York Department of Taxation and Finance – TB-MU-220, E-File Mandate for Tax Return Preparers