Q&A with the Pennsylvania Department of Revenue

Scenario: PA-40 notices are sent with changes to taxpayers' returns with little explaination

Nov 04, 2015
Scenario:

PA-40 notices are sent with changes to taxpayers' returns with little explanation.  Attempts to call the DOR can result in being on hold for an hour or more.  When a call is finally answered, some agents are willing to talk with us and others want a Power of Attorney. 

Q:


Could PA consider 1) putting a third-party designee on the PA-40 similar to IRS, so someone is authorized to discuss a prepared return 2) consider a Practitioners hotline like the IRS so Practitioners could find out what the DOR is changing in a notice faster and/or 3) could DOR have further explanation on each change on a notice?  

A:

1) Unfortunately at this time, there is currently little or no space available for adding an additional line to the PA-40 without going to a three page form.  

2) The Department implemented a dedicated queue for tax practitioners to email questions to the Department web site in July 2011. This email site was established in response to requests from tax practitioners. A tax practitioner can email the Department with specific questions and receive responses back within two business days. This site even allows the tax practitioner to attach electronic correspondences to the emails for review. 

3) The Department is currently reviewing all of the notices and we will begin to improve our notifications in the future; however, due to current system limitations we do not currently have the ability to create a specific notice for each individual taxpayer’s adjustment. In addition, we are limited to the amount of lines we can put on a notice.

When an adjustment is made, our tax examiners will send the most applicable notice available, but they are required to document in the system with a detailed explanation.  If the taxpayer or the tax practitioner contacts our Taxpayer Service and Information Center either over the phone or through our email system, the employee will be able to explain the adjustment in more detail. As we move forward into a new tax system, improvements to our notices will be explored.

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These documents provide a summary of the answers provided by the Department of Revenue to the PICPA Committee on State Taxation at its annual question and answer session. These documents are classified as revenue information issued for informational purposes only for the convenience of PICPA members. Pursuant to 61 Pa. Code Section 3.4, these documents should not be relied upon for any purpose or used in tax appeals. Taxpayers requiring a binding opinion on their specific fact situation may request a written letter ruling under 61 Pa. Code Section 3.3.