LIGHTS! CAMERA! The Division of Taxation in ACTION!
At the Division of Taxation, Neena Savage and her staff have completed the third phase of the Integrated Tax System and taken a hard look at the challenges of last year to alleviate problems and make the taxpayer experience better. (The first phase was completed in July of 2014 and the second in November of 2015. In each phase, multiple tax types were migrated over to the new computer system.)
Neena S. Savage is Rhode Island’s new Tax Administrator. She formerly served as Acting Tax Administrator and was appointed by Rhode Island Department of Revenue Director Robert S. Hull to oversee the Rhode Island Division of Taxation. As Tax Administrator, she is responsible for providing the overall guidance and direction of the Division of Taxation, which has approximately 230 employees and an expenditure budget of $23.7 million for the current fiscal year.
Future plans as noted in the November 2016 press release include “migrating estate tax records over to the new system; moving the revenue accounting system onto the new system; and constructing a taxpayer portal, which would, among other things, let taxpayers log in and manage their accounts, grant online access to tax professionals, make payments, and check balances.”
Ready for Action
Like most organizations in the public, private and government sectors, keeping up with technology is vital, and determining which technology solutions are best for strategy and growth can be formidable.
The Society fully supported the budget increase to allow for the computer upgrade. According to David M. Sullivan, former Tax Administrator at the Rhode Island Division of Taxation in a 2014 issue of What Counts!, “The Rhode Island Society of CPAs was outspoken in its support for the overall agency-wide computer system.” The Division of Taxation had been significantly behind in its technology so the latest upgrades were a move in the right direction.
Neena reports that the new state-of-the-art Integrated Tax System is ready for its second full filing season. With the number of refunds at a record high, the new system is designed to integrate taxes, streamline efficiency and improve administration.
According to Neena, the Integrated Tax System has been a tremendous operational success, both on time and on budget. She commends her tax team who implemented the system while running all the regular day-to-day operations of the office. In fact, Neena is proud that her office did not hire any additional state employees for this project.
Challenges Along the Way
Of course, there have been challenges whose cause, looking back, is based on a number of variables. Compounding the challenges in the last tax season was the national tax refund fraud that certainly impacted Rhode Island, too. All in all, last year's activity mandated careful scrutinizing of more returns to be sure the refunds get to the right place.
Neena notes that the input of CPAs is critical to both the success of the agency as a whole and the successful use of the new system. “At every point, we look at how we serve the public. CPAs are one of our main stakeholders and we look to them for guidance. Our success doesn’t happen in a vacuum.”
According to Pat Thompson, a partner at Piccerelli Gilstein & Co. LLP and an active member of the Federal & State Taxation Committee, “tax professionals know the first year of any computer conversion is tough and we always expect challenges. Now, in year two, we expect the bugs to be worked out so filings and refunds return to normal.”
She adds that if there are ever any discrepancies involving notices to taxpayers, the Division of Taxation representatives are readily available for a speedy resolution of the issues in questions.
Neena emphasizes that her office tries to prioritize calls from CPAs. “It is in everyone’s mutual interest for CPAs to bring issues to our attention and work collaboratively to resolve problems.”
Pat further explained that, for this year, there were not many delayed federal tax law changes that would impact the computer programming. “Those late changes are always a challenge for software providers.”
While recommendations from the Division of Taxation are more geared to individuals filing without the help of a tax professional, Neena reinforces that early and electronic filing is still crucial to streamlining the process and improving efficiencies. That process is certainly heading in the right direction with the number of electronic tax returns increasing from approximately 526,000 to 549,000 in the last two years with paper returns declining.
Retiring the Old. Looking Ahead.
“The world is changing and commerce is moving at a rapid pace. We are growing with that. There will be challenges ahead,” expounds Neena. She explains that government needs to keep up with the pace of business.
To that end, the Division of Taxation has officially retired its 40-year old mainframe computer. The antiquated system had several different "silos" that were not integrated.
Looking ahead, Neena reports that “we are in the midst of organizational recalibration to be sure we are optimizing the use of staff. We have an agile workforce. It’s an honor and privilege working with our team.”
Neena gladly shares her contact information with the members of the Society. You can reach her at 401.574.8889 or via email at Neena.Sinha.Savage@tax.ri.gov. Follow the Division of Taxation on Twitter @RhodeIslandTax or access the special edition of the Rhode Island Tax News for the 2017 filing season.