Pennsylvania – e-File Mandate for Third-Party Preparers

SALT Report 3039 – The Pennsylvania Department of Revenue issued guidance regarding the electronic filing requirements for third-party return preparers who file 11 or more sales and use tax returns per year.

Under the provisions of 72 P. S. § 10, a third party preparer who prepares 11 or more Pennsylvania Sales, Use, and Hotel Occupancy Tax Returns, will be required to electronically file all such returns. Also, once a preparer becomes subject to the e-filing mandate, they will remain subject to the mandate regardless of how many tax returns they prepare in a calendar year.

The 11 return threshold applies to all original and amended returns that either the third party preparer or its employees prepare and submit to the Department.  Additionally, if a third party preparer has multiple business locations, the 11 return threshold will include the combined total of all returns in all locations.

The e-filing mandate applies to all filing periods on or after January 1, 2014, or to tax years beginning on or after January 1, 2014.  Failure to file electronically will result in penalties that range from $10 for each improperly filed return, or 1% of the tax due on each return up to $500.

In certain circumstances, the Department will waive a penalty if the taxpayer has specifically requested that the preparer file the return differently, or if the preparer’s software does not support the e-filing system. Additionally, the Department is authorized to waive penalties if the mandate creates an undue hardship on the preparer.  However, the preparer will be required to submit a written request that clearly explains why the e-filing method causes an undue hardship.

For Further Information

Pennsylvania Department of Revenue – Notices