New York's Penalty and Interest Discount Program (PAID)

New York's Penalty and Interest Discount ("PAID") program ends on March 15, 2010. The PAID program gives taxpayers with older unpaid bills the change to save up to 80% of the penalty and interest they owe.

To take advantage of the program's savings you must make all payments by the program's expiration date, March 15, 2010. If you do not pay in full by that date:

• your opportunity for these saving will be lost forever.
• any unpaid tax debts will continue to accrue interest at the full statutory rate.

Why PAID Is Good For Your Company.

You can save:

• 80% of accrued penalty and interest on unpaid bills issued on or before December 31, 2003.
• 50% of accrued penalty and interest on unpaid bills issued after December 31, 2003 and on or before December 31, 2006.
• Unpaid tax bills are bad for the company's credit rating and can lead to liens and other enforcement actions.
• The State is increasing its efforts to collect unpaid bills. If you act now and pay what you owe, you can take advantage of the savings and avoid collection action.

Reminder New York Filing Fee Now Applies to Partnerships

Under New York's new tax law, the New York filing fee applicable to limited liability partnerships (LLPs) and limited liability Companies (LLCs), is not appliable to partnerships.

The filing fee for regular partnerships only applies is the partnership's New York sourced gross income is $1 million or more. The filing fee applies to tax years beginning on or after January 1, 2009, and is due within 30 days of the last day of the partnership's tax year.

The amendment to tax law does not change the filing fee requirements or the fee calculations for LLCs and LLPs treated as partnerships, or the fee that applies to LLCs that are disregarded for federal tax purposes.

Eroding Conformity with Federal Tax Provisions

Two federal enactments in 2009 designed to provide economic stimulus raised conformity issues that increasingly pushed states further apart from the federal corporate income tax system. The American Recovery and Reinvestment Tax Act of 2009 ("ARRA") amended numerous provisions of the Internal Revenue Code ("IRC") including bonus depreciation, asset expending, cancellation of debt income, NOL carry backs, NOL limitations after a change in ownership, and S Corporations built-in gains.

The Workers, Homeownership, and Business Assistance Act of 2009 (WHBAA") provided taxpayers with an election to carry back NOLs for tax year beginning or ending in either 2008 and 2009 for three, four or five years.

Many states decoupled from these provisions, the resulting decoupling complicates matters for companies that operate in multiple states.