Overview of Project
The purpose of the Combined Electronic Tax Registration Project is to implement an online tax registration system that will enable multistate taxpayers to register to report and remit tax simultaneously in a number of jurisdictions on a "one-stop shopping" basis. The project will certify vendors to provide this service. Certification will be dependent on each vendor meeting project technical and privacy criteria. Any vendor so certified may offer its services directly to taxpayers on a competitive basis; this is analogous to the current system for vendors offering electronic filing of personal income tax returns. Certified vendors will be responsible for establishing and maintaining interfaces with participating states and with taxpayers; no state will be expected to modify its existing systems in order to participate in the project. The MTC will maintain a webpage listing the certified vendors and providing taxpayer access to those vendors by a system of links.

The project is intended to both accommodate conventional registration under the current system, and to be easily adaptable for users of the Streamlined System. The user will answer a series of questions on a number of screens, the purpose of which will be to complete tax registration in each of the states in which the taxpayer intends to file. This necessitates the system being able to handle both conventional and streamlined registration. The user will be asked early in the process to indicate which states in which it wishes to register conventionally and whether it is registering under the Streamlined System. The answer will determine the content of the subsequent screens. From the user's perspective, this should be a seamless process that does not necessitate registering separately under each system; for example, it shouldn't be necessary for the company to indicate its name, FEIN, address, phone number, principal contact, etc., more than once.

The project's initial focus will be sales and use tax and business activity taxes, such as the corporate income tax. The MTC welcomes and encourages all vendors to work with us in its effort to serve as an electronic portal for multistate tax registration. The following guidelines are intended to provide vendors with an overview of requirements for participation.

Definitions
As used in this Policy, the term "vendor" means a vendor of electronic tax registration services and the term "taxpayer" means a customer or potential customer of a vendor. As used in this Policy, the term "state" means a state revenue department.

Disclosure of Information
Participating vendors shall comply with all applicable state laws and policies regarding the use of confidential taxpayer information. To the extent that participation in the project allows a vendor to obtain non-confidential information from a taxpayer, the vendor shall not use that information for commercial purposes without the express, advance authorization of the taxpayer.

Charges for Participation and Registration
Neither the MTC nor any state shall charge vendors to participate in the project. No vendor shall charge the MTC or any state for acceptance, processing and transmitting electronic registrations. Vendors may recoup the costs of providing this service in any commercially reasonable manner, except that no fee may be charged any registrant in the Streamlined System.

Certification
Vendors shall be certified by the MTC before they can begin transmitting electronic registrations. All vendors shall be required to pass a systems check in order to be certified. Once a vendor is certified, it must continue to comply with all certification requirements in order to continue to participate.

In order to be certified vendors must first test data transmission with each participating state. Once certified, vendors must maintain a high degree of data integrity, compliance and accuracy in order to continue to participate. In addition, a certified vendor must provide assurances that its system will be designed to electronically process tax registrations in all participating states. A vendor who does not comply with any participating state communication protocol, file layout specifications, and edit rules, or who does not consistently send accurate, timely data, or who does not comply with the Disclosure of Information provisions of this Policy could be barred from participation or continued participation in the project.

Marketing/advertising Your Services
The MTC will provide links on its web site to vendor web sites so that taxpayers may easily explore options and make their decisions on choosing a transmitter. Other than the website link (via icon or text), the MTC will provide no additional descriptive information about any of these sites. Vendors are allowed to advertise through whatever channels they choose.

Timing of Transmissions

Vendors must submit taxpayer registrations in real time, unless a state indicates otherwise. If a registration is rejected due to a failure in transmission, the vendor is responsible for correcting the problem and resubmitting. A registration is not deemed filed in a state until it has been accepted and acknowledged by that state.

Recall or Interception Prohibited
Once a registration has been transmitted to and accepted by a state, it cannot be recalled or intercepted.

Updates to Registration Data
In order to change information on a registration that has been filed and accepted the taxpayer must file a separate amended registration. Updates to registration data may be processed electronically according to individual state policies and/or readiness to maintain files electronically, if they comply with all other requirements of this policy statement.

Communication and Transmission Layouts

Vendors must comply with each participating state's current communication protocol, security standards, file formats and file transfer rules, unless a state is prepared to develop a protocol that is acceptable to both the vendor and the state.

Testing
The states will provide the communication protocols, file format specifications, edit rulesand test cases that are necessary to implement an electronic registration system. A test package for each state will be provided to all vendors who are interested in filing electronic registrations.

Before each state will accept any electronic registrations, the vendor must test its communication/transmission protocol and test the transmission of each electronic registration it intends to file. If at any time the vendor changes software, the new software must be tested. Vendors may also be required to re-test in a state if that state changes its rules or policy.

Data Integrity

Vendors are responsible for the timeliness and accuracy of the data being transmitted. All electronic registrations that have been successfully filed with a vendor must be recorded by the vendor as having been received at that time and that calendar date (e.g., 11:59 p.m. is one day and 12:01 a.m. is the next day).

Taxpayers are responsible for notifying each state of any change to their business, such as an address or phone number change, new or dropped tax types, closed business or location.

Additional State Registration Requirements
Participating vendors must meet all additional state registration requirements, such as the timely submission of any required fees. Interested vendors should state how they intend to comply with these requirements.

Technical Support
Participating vendors must provide technical support that at a minimum, meets the following specifications. First, each vendor must provide links to the websites of each of the participating states, so that taxpayers can access the latest state tax policy statements. Second, each vendor must maintain a level of services agreement that describes the vendor's technical support services. A current copy of the level of services agreement shall be provided to the MTC as a condition of certification and continued certification. Technical support shall at a minimum be provided from 9 a.m. to 5:30 p.m. local time, Monday through Friday.

Project Documentation
Interested vendors should contact Sheldon Laskin at slaskin@mtc.gov or (202) 508-3807 for more information, including copies of the project documentation referred to in the policy statement.

Vendor Responses

Interested vendors should send their responses to:

Sheldon H. Laskin
Director, National Nexus Program
Multistate Tax Commission
444 N. Capitol Street, Suite 425
Washington, DC 20001
Phone: (202) 508-3807
E-mail: slaskin@mtc.gov

Responses should at a minimum include the following information. If your firm intends to subcontract any portion of the work on this project, you should supply the name of any subcontractor, describe the portion(s) of the job you intend to subcontract, and provide the requested information for each subcontractor.

1. Length of time the firm has been in existence.
2. Nature of the business.
3. Number of full-time employees.
4. Three customer references.
5. Narrative description of how you propose to offer electronic registration services through the project while satisfying all of the requirements of this policy statement.
6. Whether you would be able to process updates to registrations and if so, what additional cost and data security issues such processing would entail.
7. The earliest and latest dates on which you expect to be able to implement electronic registration.
8. Any proposed fee schedule for this project. NOTE: This information will not be used to disqualify any individual vendor on the basis of its fee structure. Rather, the states will evaluate this information to determine if the project itself is realistic in terms of the likely cost to taxpayers in return for the benefits of "one-stop" registration.
9. A description of your plan to timely incorporate changes in state laws, practices and procedures into your system.

A description of any additional cost, security and record retention issues that would be raised if your system were required to process amended registrations in addition to initial registration.


Although there is no formal due date for vendor submissions, the MTC would appreciate a response within 30 days of the date of this Policy.

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