April 2013 Edition of Indian Tribal Governments News
- Director’s message
- General Welfare Refunds
- New FinCEN filing system
- Taxpayer Identification Number (TIN) On-Line Matching
- Tribal committee and board members: employees or contractors?
- Paying proposed exam adjustments and penalties with EFTPS
- Social Security Administration contacts for payroll purposes
- ITG customer satisfaction survey is coming!
- Form 11-C due July 1st
- Outreach successes
- Pacific Northwest training opportunities
- Arizona training opportunities
Last month we sent you some tax tips to help you through the tax filing season. This edition offers some information about some of the electronic systems that are available to help you with TIN matching, filing and making payments.
We will be sending Tribal leaders our annual ITG Customer Satisfaction survey. It’s voluntary, yet we encourage Tribes to participate. The survey gives you the opportunity to tell us what’s working and offer ideas on how we can improve!
We’ll also be providing more information about General Welfare this summer, so please be on the lookout.
ITG is working hard during these challenging economic times to provide you top quality support. Remember – you can send any questions or comments to us.
Christie Jacobs, Director
General Welfare Refunds
IRS Notice 2012-75, Application of the General Welfare Exclusion to Indian Tribal Government Programs That Provide Benefits to Tribal Members, provides information about a wide range of benefits regarding General Welfare and federal income tax exclusion. Page three of the notice states that tribal members can request a federal income tax refund if the tribal program, due to relief by the notice, is no longer subject to taxation.
Please contact your ITG Specialist with any questions related to filing a general welfare refund claim. Note that the statute of limitations on general welfare refund claims is generally going to be three years from the due date of the filing of the return.
New FinCEN filing system
The Financial Crimes Enforcement Network (FinCEN) recently issued a reminder to casinos and other financial institutions. The reminder reiterates that all such entities must adopt the new format for Currency Transaction Report (CTR) and Suspicious Activity Report (SAR) forms by April 1, 2013.
After March 31, 2013, the old format for these reports will not be available on FinCEN’s E-Filing system. Casinos and other financial institutions that continue to file mandated reports using the old format will fail to meet Bank Secrecy Act (BSA) reporting requirements. FinCEN may reject any mandated reports filed using the old format and return them to the filing institution. The filing institution may then be subject to civil money penalties.
For more information about BSA E-Filing, please review the E-Filing Section on FinCEN's website. Any general questions regarding this or other BSA issues should be directed to the FinCEN Regulatory Helpline at 1-800-949-2732. For other technology-related questions specific to E-Filing, please call the BSA E-Filing Help desk at 1-866-346-9478.
Taxpayer Identification Number (TIN) On-Line Matching
The IRS offers TIN matching as part of a suite of internet based pre-filing e-services It offers you the opportunity to match 1099 information against IRS records prior to filing information returns.
When a payee’s name and taxpayer identification number on any of those returns does not match IRS records, you may receive a notice to begin back up withholding or even a penalty proposal.
Using the TIN Matching system allows you to verify a customer or vendor’s TIN and name information before submitting the information to IRS. The IRS may waive any penalties for filing an incorrect information return if you show the failure to provide a correct TIN is due to reasonable cause and not willful neglect. You may prove due diligence and receive a waiver from proposed penalties if you can prove the TIN and name combination you submitted matched IRS records. Providing a copy of the "Print Screen" of your Interactive Results will be considered proof.
You can use the TIN Matching system to verify name/TIN matches when filing Form 1099.
Find out more about the TIN Matching program, including how to register, by reading this article.
Tribal committee and board members: employees or contractors?
ITG Specialists have received questions about pay received by board members and committee members.
In order to make this determination, please refer to Publication 1779, Independent Contractor or Employee. This publication discusses how you should use the three categories of evidence to determine if your board or committee members are your employees.
If you need further assistance making the determination, then please contact your assigned ITG Specialist to discuss these categories.
Below are other resources to review:
- Independent Contractor (Self-Employed) or Employee?
- Government Workers: Employees or Independent Contractors
- FAQs for Indian Tribal Governments regarding Employee vs. Independent Contractor
Paying proposed exam adjustments and penalties with EFTPS
Taxpayers currently enrolled in the Electronic Federal Tax Payment System (EFTPS) can now use it to make payments on proposed exam adjustments and civil penalties.
EFTPS is a free service from the U.S. Department of the Treasury. Since it began in 1996, millions of businesses, individuals, federal agencies, tax professionals and payroll services have used EFTPS to pay their federal taxes.
You can pay all federal taxes using EFTPS, including additional tax or penalties resulting from an IRS audit. Quick, secure, and accurate, EFTPS is available by phone or online 24 hours a day, 7 days a week. You can schedule a business payment up to 120 days in advance or an individual payment up to 365 days in advance.
Ask your ITG Specialist for a quick “how-to” guide that walks you through the EFTPS online screen selections.
Social Security Administration contacts for payroll purposes
The Regional Employer Services Liaison Officers are available to provide assistance with all questions about the agency's payroll reporting processes and applications. The Social Security Administration’s website provides a complete listing by state.
ITG customer satisfaction survey is coming!
We’re asking each tribe to complete a survey about their experiences with ITG in the past year. We will mail the survey to tribal leaders and ask for responses. We will post the results on our website; responses will remain anonymous.
This survey is voluntary, but we hope you will participate. Surveys conducted in prior years have led to developing new products and processes, so your input is valuable and important.
ITG’s overall goal is to use partnership opportunities with Indian tribal governments to help simplify the tax administration process. We receive valuable input from Indian tribal governments and tribal associations that help us improve understanding and meet your specialized needs.
If you have any questions or concerns about the survey, please contact your designated ITG Specialist.
Form 11-C due July 1st
Tribes selling pull-tabs are required to file:
- Form 11-C, Occupational Tax and Registration Return for Wagering; and
- Form 730 Monthly Tax Return for Wagers
Form 11-C is an annual return which applies to persons receiving taxable wagers whether they receive compensation or are volunteers. Both the tribal government and agents (persons who accept taxable wagers on behalf of the tribe) must file Form 11-C to register and to pay the occupational tax before wagers are accepted and annually thereafter. Each agent has a unique Employer Identification Number (EIN) for purposes of the Form 11-C Occupational Tax.
Generally, the amount of the occupational tax is $50 per year per person.
July 1, 2013 is the due date for Form 11-C for the period July 1st, 2013 through June 30, 2014.
Southwest Group 7282 held two separate Basic Employment Tax Training workshops in December at Flagstaff and Chinle, Arizona. ITG customized the training sessions to meet the needs of the Chinle and Western Agency of the Navajo Nation Tribal Chapter governments.
Approximately 66 individuals attended the training sessions that included topics such as defining employees vs. independent contractors, payroll taxes, federal tax deposits and avoiding penalties.
ITG also held End of Year Reconciliation workshops in Rio Rancho, New Mexico at the UNM West Campus. One hundred fifteen representatives from 74 Navajo Nation Chapter houses attended these one-day workshops.
At our workshops, ITG specialists covered the forthcoming deadlines for the final 2012 employment tax returns, 1099-MISC information returns, and W-2 information returns. Specialists also covered the payroll tax holiday expiration to ensure that the proper social security withholding rate for employees of 6.2 per cent would be used in 2013.
These self-paced workshops encouraged participants to bring in payroll records, prepare their final employment tax and W-2 information returns and perform a year-end reconciliation. This gave them the opportunity to make sure that the totals reported on 941 returns for the year matched the W-2 totals. ITG Specialists assisted with any problems the participants encountered.
The goal was for attendees to become current with their 2012 reporting and most importantly correctly reconcile their 2012 returns. In many instances, chapters identified reporting errors and were able to make corrections.
By preparing year-end reconciliations these chapters ensure that they will not receive notices in the future from the IRS questioning why filed 941 returns did not match the W-2 totals reported to the Social Security Administration. Often these mismatches result in additional tax, penalties and interest being assessed on the tribal entities that could have been avoided if a reconciliation had been performed and errors corrected immediately.
Most attendees were able to successfully complete all 2012 Form 941 returns, prepare all W-2’s and reconcile their records - making these workshops our most successful yet!
Pacific Northwest – Alaska
ITG held an Employment Tax/Gaming Training in Juneau in February. The Central Council of the Tlingit and Haida Indian Tribes of Alaska (CCTHITA) sponsored the workshop. Sixteen individuals representing nine different tribal governments and two village corporations attended our four-day workshop. ITG specialists from the Anchorage office presented the workshops. Guest speakers from the State of Alaska presented gaming rules and regulations and employment issues related to Alaska's State Unemployment filing requirements.
The Anchorage office also held their Annual Basic Employment Tax/Pull Tab Gaming Training during two different sessions in March. ITG specialists presented a full-day session for pull tab, bingo and gaming issues for the first day. The remaining days dealt with employee issues and information reporting.
Throughout the two different sessions 54 individuals attended. Below is the attendee representation:
- Thirty-eight tribal governments (62)
- Four cities (6)
- One village corporation (2)
- Two nonprofits (6)
- State of Alaska (2)
Additionally, the state of Alaska Department of Revenue Tax Division (Gaming Unit) provided a guest speaker who discussed state gaming issues and regulations. The state of Alaska Department of Labor and Workforce Development also provided guest speakers who discussed employment issues related to Alaska's unemployment tax filing requirements. The workshop covered topics such as making federal tax deposits, avoiding penalties, computing the correct taxes for payroll, due dates and completing and reconciling various IRS forms.
If you are interested in workshop session at an IRS office location, please contact your assigned ITG Specialist.
Pacific Northwest training opportunities
The office of Indian Tribal Governments (ITG) will be offering three workshops for our Tribal customers during May. The training location is 100 SW Main St., Portland, Oregon, Room 990.
|Basic Payroll Tax/Information Returns Workshop - May 21, 2013|
|Advanced Payroll Tax/Information Returns Workshop - May 22, 2013|
|Gaming Information Return Workshop - May 23, 2013|
Entity Compliance Checks
We will also be offering the opportunity for the attendees to meet on a confidential basis to discuss their entity’s reporting requirements, tax issues, notices, or other tax related matters with an ITG Specialist. Please contact us prior to the training to schedule a time for the meeting.
For more information or to register, contact Doug Wellington or call 503-415-7315. Please respond by May 3, 2013.
Arizona training opportunities
ITG will be offering the following workshops at the IRS office located at 300 West Congress Street in Tucson: Conference Room B.
Gaming Issues and Reporting Workshop – offered twice!
April 25, 2013; 9 a.m. - 4 p.m.
July 31, 2013; 9 a.m. - 4 p.m.
- Required tax reporting for gaming-related payments/activities
- U.S. residents – W-2Gs, Forms 1099-MISC, 1096, and 5754
- Foreign persons – Forms 1042, 1042-S and T, W-7, W-8BEN, and Pub 515
- Tax deposit schedules
- Avoiding penalties and interest
- End of year reconciliation of Forms 945 to W-2G and 1099-MISC and the various 1042 Forms
- TIP compliance – Form 8027, TRDA and GITCA Tip Agreements
- Other topics
Mini-Advanced Employment Tax Workshop – offered twice!
May 7-9, 2013; 9 a.m. - 4 p.m.
September 17-19, 2013; 9 a.m. - 4 p.m.
- Defining employees vs. independent contractors
- Computing the correct taxes for payroll
- Completing Form 941, Employer's Quarterly Federal Tax Return
- Making federal tax deposits
- Due dates on tax returns
- Completing Forms W-2/W-3 and 1099/1096
- Reconciling Forms 941 and W-2 at year-end
- Avoiding penalties
- Meeting rules for an accountable plan for per diem & travel reimbursements
- The IRS collection process
- Fringe benefits general welfare payments including job training payments/compensation & scholarships
- Loans to tribal members
- Loans to employees
- Election workers
- Elected officials
Space is limited; only 30 reservations will be accepted for each session. Please contact Tricia Miller for additional information or to register.