NACHA Launches State Tax Change Portal
NACHA, the electronic payments association, has launched the State Tax Change Portal. Developed by NACHA in conjunction with the Federation of Tax Administrators (FTA), the State Tax Change Portal functions like a listserv and directly alerts subscribers to changes in automated clearing house (ACH) taxing authority routing and format requirements for state business tax payments.
“The State Tax Change Portal was developed in response to industry need,” said Janet Estep, president and chief executive officer (CEO), NACHA. “Financial institutions and payment processors were looking for a way to find out about changes made by state tax authorities that affect ACH payments. The State Tax Change Portal provides the solution for states to communicate such changes, creating timely notices that help minimise returns for businesses paying state taxes electronically through the ACH Network.”
A concept that originated in NACHA’s Council for Electronic Billing and Payments (CEBP), the State Tax Change Portal has four objectives:
“Financial institutions and payment processors generally hard-code a taxing authority’s information to properly format and route payments according to taxing authority requirements,” said John Biloz, vice president, JP Morgan Treasury Services, which originally brought the issue to the attention of the CEBP. “When there’s a change, updates are necessary to enable timely payments, and in some cases, these updates can take some time to install. The State Tax Portal enables pending changes to be shared with us in advance of the effective date, providing the necessary lead time for preparations to ensure a more efficient process for all parties.”