The Unknown Bureaucrat

Óþekkti Embættismaðurinn

Just outside the City Hall of Reykjavik in Iceland stands a monument to the "faceless" city officials. Sculpted by Magnús Tómasson in 1994 shows a man on his way to work with a briefcase in hand and the upper part of his body is covered in a huge piece of Icelandic volcanic basalt. You'll have to decide for yourself whether it was meant as a serious tribute to the country's numerous bureaucrats who serve their country and keep it running, or a humorous, satirical piece known by the locals as 'the blockhead'.

According to the local publication, the Reykjavík Grapevine: “The block of rock is a perfect metaphor for how everyday life crushes down on us, while at the same time depicting the narrative of the faceless official who is only a cog in the wheel, and never a person to most of us."

Don't forget to VOTE!!

Keep RI's blockheads in check.

Does your business collect & remit sales tax?

Most businesses will need to file and remit taxes online!!

Sales Tax
Payroll Tax
Meals & Beverage Tax
Income Tax

Beginning on January 1, 2023, "larger business" taxpayers are required to file returns and remit taxes to the State of Rhode Island electronically.

Register for the RI Tax Portal to File and remit your taxes. If your a business that collects sales tax, we strongly recommend that you register for the Tax Portal. If you have difficulties, just call us at 401-942-6900 and we will help you.

LEARN MORE

Do you have RI Tax Portal?

If you collect & pay RI Sales Tax online - GREAT!

If you collect & pay RI Sales Tax, you'll need to register for a portal by December 31, 2022.

The portal provides functions and benefits aimed to make tax compliance easier such as:

File and pay tax returns
Make payments conveniently from your checking or savings account
Effortlessly view or print bills sent from the RI Division of Taxation
Simpler, intuitive interface for requesting a Letter of Good Standing
Easily submit a Power of Attorney, change your address, or phone number by submitting a service request
Quickly and easily view any outstanding debts from the home page
View history of returns and payments
View carryforwards, estimated and extensions payments

E-FILE Required for most businesses

ADV 2022-22

Sales Tax
Payroll Tax
Meals & Beverage Tax
Income Tax

Rhode Island "Larger Businesses" is defined as any person who:

• Operates as a business whose combined annual liability for all taxes administered by the Division of Taxation is or exceeds $5,000; or

• Operated as a business whose annual gross income is over $100,000.

RI 2022 H 7123 Substitute A as Amended

Beginning Jan. 1, 2023, a business who fails to pay their taxes electronically will be fined the lessor of 5% of the tax liability or $500, plus $50.

For example:

Dwight Schrute of Schrute Farms, an Amish beet farm and Bed & Breakfast in Scituate, has annual sales of $100,000. Schrute Farms has a quarterly payroll tax liability of $30 for the 4th quarter of 2022. Dwight hates computers and swears they're "the Devil's work". Unfortunately, Dwight's refusal to file online is going to cost him $81.50 on a $30 tax bill.

$30 + $50 + ($30 x 5%) = $81.50

Does your business do business in other states?

NEXUS can simply be defined as a certain minimum connection or presence which must exist before a state can impose a tax on an out-of-state business.

You may have a tax filing requirement in that state if you have:

workers in another state than where your business is located
physical or virtual property in another state
warehouses
inventory

Once nexus has been established with a state, a company is subject to the state's tax liabilities and reporting requirements. Let's take a look at a few examples where a business could have a nexus out-of-state filing requirement.

Example 1:

Mary Jones has an Etsy store, Mean Mugging, Inc., where she sells custom and personalized tumblers (think travel mugs). She is located in Rhode Island but sells all over the United States, particularly to New Jersey - those Jersey mom's really love her! So much that she sold 4,000 tumblers last year and has gross revenues of $100,000 just in New Jersey alone. Because of this, Mary has a sales tax requirement to New Jersey even though her business is in Rhode Island.

Example 2:

Jane Smith runs an online IT Support company, Clouding with Jane, with employees all over the US. People can call 800-TECH-ME2 and be connected to an IT specialist to help them with their computer challenges like connecting a printer, app development, CRM integrations, and monitoring warehouse cameras with an app. Business is so great that Jane had to hire 400 new tech specialists who will work remotely within the United States just to keep up with her clientele now working remotely. Majority of her staff are in California, New Mexico, Illinois, and New York (within the 4 Time Zones to capture more clients at any time of the day). Jane has a nexus requirement to California, New Mexico, Illinois, and New York because that's where her staff are located and have state taxes withheld from their pay for their home state.

Example 3:

Marco Pollo took advantage of the post-COVID market and purchases sandwich & food wrap storage containers from Alibaba for $3-5 a piece and sells them to Amazon Fulfillment for sometimes a 300% mark-up. Amazon then turns around and fulfills the order when someone purchases this item from his Amazon storefront. Marco even set up an automation to re-order the item when inventory get's below a certain threshold. Business is so good that he quit his 9-5 corporate job and is looking to make $150,000 this year all from the comfort of his home while in his pink bunny slippers. Amazon holds Marco's inventory at their various warehouses. Marco has a nexus filing requirement.

Confusing, isn't it? If only you knew a really great accountant who has extensive knowledge of what and when a nexus filing requirement has been triggered....

oh wait! YOU do!!

IRS Adds 4,000 to Customer Service Ranks

Here we are, almost at the end of the year, and many taxpayers still have been waiting on baited breath to receive their refunds from their 2021 tax returns. There's some good news.

The IRS announced it has made significant progress in preparing for the 2023 tax filing season after hiring 4,000 new customer service representatives to answer phones and provide other services. The IRS said the employees were hired over the past few months as part of improvements that are being funded by the Inflation Reduction Act of 2022. The agency said its goal is to add another 1,000 customer service representatives by the end of 2022.