Monday, January 14, 2019
AN ANNUAL TRADITION
Just as I always knew, before he retired, where one of my 1040 clients would be every year on New Year’s Eve – he was the technician that worked the machine that dropped the ball at midnight on One Times Square – you can be sure where I will be (barring weather or health complications) on the second Saturday in January every year - at the APA Hotel Woodbridge in Iselin NJ for the “Famous NJ State Tax Seminar” presented by the NJ chapter of the National Association of Tax Professionals.
In the almost three decades that this event has been held I have missed only a few offerings, due to snow. This seminar is a “must attend” for any tax professional who prepares NJ state individual or corporate income, payroll, inheritance, and/or sales tax returns, and certainly worth, for me, the 2-hour 100 mile drive each way.
The event always includes a breakfast and lunch buffet, both now offered in the seminar area, which I prefer. Last year the lunch buffet was limited to salads and sandwiches, and I had commented that I would prefer it include hot items. Someone was listening, as this year the lunch buffet included cold salads and sandwich makings and several hot offerings. I was pleased. And the breakfast buffet continues to be among the best of those offered at tax seminars I have attended over the decades.
As has become the custom, after welcoming remarks from chapter Board members the seminar begins with a “keynote address” by the current Director, of Acting Director, of the NJ Division of Taxation. This year we heard from, still only Acting Director, John Ficara.
I repeat my comment from last year’s “review” of the seminar –
“I have always felt that over the years, with very few exceptions, these presentations have been of no real substantive value to the tax pros in the audience. I do accept that this practice is probably a good and necessary one, and, thankfully, very little time in the schedule is allotted to the Director’s presentation. Mr. Ficara, was a good and obviously knowledgeable speaker . . . but there was really nothing of consequence to ‘take away’. There was no time for audience questions or comments, and he did not address real systemic issues with the Division, such as its continued unethical practice of remaining ‘silent’ on taxpayer overpayments or unidentified payments.”
This year’s address was truly redundant, touching briefly on topics that were discussed in more detail by the other NJDOT representatives in subsequent presentations, and, again, nothing about the Division’s ongoing systemic issues.
To again repeat a comment from last year’s review post –
“Perhaps for the future seminars registrants could be asked to submit to the chapter in advance written systemic questions and concerns for the seminar chair to present to the Director instead of the nice but mostly useless keynote address.”
The rest of the morning was devoted to the presentations of NJ state tax updates from “Jake and Company”, aka the Division’s “Taxation University”. Although it is no longer “Jake and Company”, but now “Bill and Company”. Jacob Foy, who had been the Supervisor of the “Taxation University”, and had been speaking each year at this seminar since 2005 (when his hair was down to his shoulders and often tied in a pony tail), in the earlier years part of the popular “Jim and Jake Show”, is now the head of the, I believe, Taxpayer Communications Unit, apparently a newly created position. Jake was replaced as TU Supervisor by William Malkin. Bill has some huge shoes to fill; he got off to a good start Saturday. Good luck, Bill!
Jake has truly been very helpful to NJ-NATP and its members, and specifically to me personally with various client issues, over the years. I thank Jake for all his help in the past. He assured me that he would continue to attend this “famous” state tax seminars in the future.
The first topic was “NJ Tax Updates” presented by Alexis Reid, another frequent speaker at the seminar and good friend to NJ-NATP, who has also provided invaluable help to me personally in dealing with client issues and NJDOT FUs. I will be discussing the many changes to NJ state individual income taxes in detail in an upcoming post, once the 2018 Form NJ-1040 and instructions are available at the Department’s website. Alexis did report that the NJ-1040, and its supplemental schedules, has been substantially revised, and the instruction booklet has been totally rewritten. I look forward to reviewing the new editions, and, again, will report on the changes in detail in the future TWTP post.
NJ business taxes were discussed next, by Christina Quinones. There have been several changes in the area of sales tax. “Transient Rentals”, rentals of residential property located in NJ for less than 90 days, are now subject to the NJ state sales tax, which remains at 6.625%. Rentals that are managed by realtors – the tenant deals with, receives the key from, and pays the rent to a realtor – are exempt from the tax. The entity that collects the rent – Airbnb, VRBO or other such agencies or the actual landlord for direct private rentals – is responsible for collecting and remitting the sales tax.
NJ now charges a “surcharge” on rideshare services, like those provided by Uber and Lyft. Again, the entity that collects the rideshare fee – Uber or Lyft or the individual driver – is responsible for collecting and remitting the surtax.
There were no changes to the NJ property tax relief programs – the Homestead Benefit and the Property Tax Reimbursement – but Taxation University provided a review of the various qualifications with William Malkin and Tilesha McCall.
Actually, there was one change to the calculation of the Homestead Benefit. It is now, in most cases, based on 5% of the 2006 property tax assessment instead of the previous 10%. This 5% was used to calculate the benefit provided issued on May 1, 2018. The 2019 budget provided a supplemental benefit equal to the amount paid in May to be issued on November 1, 2018.
The morning ended with a presentation by Jake on the current NJ Tax Amnesty program, which ends tomorrow (January 15th).
As an aside and follow up to last year’s comments, I was glad that the schedule this year did not include another full presentation on NJ state inheritance and estate taxes.
After lunch was perhaps the most important presentation of the day – at least for NJ tax pros who prepare or consult on payroll – “New Laws Regarding Sick Pay” by John Baldino of Humaresco. It dealt with the, in my opinion, ridiculous and complicated “New Jersey Paid Sick Leave Act”, signed into law on May 2, 2018, and which became effective on October 29, 2018.
John began the presentation by telling us to write on the front of his handout “I did not write this law!” He discussed much of the program in detail, fielding a multitude of questions from the audience, but did not have time to cover everything. As I said this was a very important topic, and it was appropriate not to limit the questions. More time should have been given to John, as there were important items not adequately covered and questions unanswered due to the time constraint.
Again as has become custom, the final item of the day was a combination of NY state tax updates and federal updates by popular NATP speaker Kathryn Keane. The big news for NY for 2018 is the state’s “decoupling” from the GOP Tax Act. As with NJ, I will discuss the NY changes in detail in an upcoming post when the 2018 IT-201 and IT-203 are available.
Kathryn followed the NJ state discussion with a review and update of the GOP Tax Act. I left before this began, having already sat through 4 redundant GOP Act presentations in 2018 and because of my 2-hour drive back to PA. As I have said for the past several years, I very strongly believe that federal topics should NOT be a part of this seminar. It should be limited to state tax issues only – NJ and NY and possibly PA. The time allotted to the federal portion of KK’s talk should have been given to John Baldino for the Sick Leave Act. In addition, the 10 or so minutes wasted giving out tote bags as prizes should have also been given to John.
As usual, the NJ chapter, and the state’s Taxation University, did a great job and once again deserve my annual kudos. And John Baldino was an excellent addition to the roster. I hope he can return in the future to speak on a different topic.
One non-state thing I was happy to learn on Saturday – the 2020 NATP National Conference will be held in San Antonio. I last attended a tax conference there in 2004. At a class taught by former IRS Director of National Public Liaison Beanna Whitlock she asked the assembled tax pros who still prepared tax returns manually – without using tax preparation software. Of course, my hand was the only one to go up. Beanna came over to where I was sitting and said, “I want to shake your hand. You are the only person in the room who actually knows how to prepare a 1040.” Needless to say, I have told that story many times in many venues over the years.