Source: https://www.nysenate.gov/legislation/bills/2013/S4310/amendment/A
Timestamp: 2017-05-24 08:08:14
Document Index: 503072181

Matched Legal Cases: ['§991', '§35', '§385', '§ 990', '§ 683', '§ 249', '§  990', '§ 684', '§  249', '§ 982', '§  249', '§ 1405', '§ 300', '§ 990', '§ 990', '§ 684', '§ 962', '§ 249', '§ 982', '§  249']

NY State Senate Bill S4310A
senate Bill S4310A Signed By Governor 2013-2014 Legislative Session Makes a reduced rate of interest applicable to certain additions of tax resulting from discovery after filing an estate tax return of certain assets
Via A5960 - Signed by Governor do you support this legislation?
signed chap.197
returned to assemblypassed senate3rd reading cal.1481substituted for s4310a
substituted by a5960aordered to third reading cal.1481committee discharged and committed to rules
print number 4310aamend and recommit to investigations and government operations
Jun 20, 2013 - floor Vote A5960A 63
Jun 20, 2013 - Rules committee Vote S4310A 25
Original A (Active) Original A (Active) S4310 - Details
A5960A
Add §991, Tax L; amd Part A §35, Chap 389 of 1997; amd §385, Chap 190 of 1990
2011-2012: A59602009-2010: A7916 S4310 - Summary
Makes a reduced rate of interest applicable to certain additions of tax resulting from discovery after filing an estate tax return of certain assets belonging to the decedent held by the state comptroller as abandoned property. S4310 - Sponsor Memo
BILL NUMBER:S4310
TITLE  OF BILL:   An act to amend the tax law, in relation to making a
reduced rate of  interest  applicable  to  certain  additions  to  tax
resulting  from  an  executor's discovery after the date for filing an
estate tax return of certain assets belonging to the decedent held  by
the  state comptroller as abandoned property; and to amend chapter 389
of the laws of 1997 amending the tax law and other  laws  relating  to
the  estate and gift tax, and chapter 190 of the laws of 1990 amending
the tax law relating to certain taxes, fees, and other impositions, in
relation to rates of interest for certain estates
The bill would  preclude  the  charging  of  interest  on  estate  tax
liabilities  attributable  to late-discovered assets in the possession
of the State Comptroller as abandoned property for any period of  time
during  which  the  State  Comptroller  did  not  pay  interest on the
Section 1 of the bill would add new section 991 to the Tax Law,  which
relates   to   additional  estate  tax  owed  by  an  estate  that  is
attributable to an executor's discovery, after the date for the filing
of an estate tax return, of the existence of an estate  asset  in  the
possession  of  the  State  Comptroller as abandoned property. The new
section would require the Commissioner of Taxation and Finance to  not
charge  interest  on  such  additions  to estate tax for any period in
which the State Comptroller did not pay interest on the  asset  it  at
the  time  the  estate's  estate  tax return was required to be filed,
including any extensions, the asset was not yet included in the public
records of abandoned property maintained by the State Comptroller.
Sections 2 and 3 of the  bill  would  apply  the  same  limitation  on
accrual  of interest as set forth in section 1 to estates of decedents
dying when prior versions of the New York estate tax  were  in  effect
Thus,  section  2  applies  that  interest  limitation  to  estates of
decedents dying after March 31, 1963  and  before  February  1,  2000,
during  which period an earlier version of Article 26's estate tax was
in effect (which was repealed by Chapter 389 of  the  Laws  of  1997).
Section  3 would apply the limitation to estates of decedents dying on
or after June 1,1944, the date on  which  the  State  Comptroller  was
first  required  to  maintain  public lists of abandoned property, and
before April 1, 1963, during which period former Article 10-C's estate
tax was in effect, prior to its being superseded by former Article 26,
pursuant to Chapter 1013 of the Laws of 1962.
Section 4 would make this bill effective immediately but applicable to
estates of decedents dying on or after June 1, 1944, the date on which
the State Comptroller was  required  to  maintain  public  records  of
abandoned  property.  Section  4 also would provide that no refunds or
credits would be Granted as a result of this act.
The discovery of assets after  the  date  prescribed  for  paying  the
estate  tax,  including  property  in  the  possession  of  the  State
Comptroller as abandoned property, can create an additional estate tax
liability, either by increasing  the  tax  due  from  an  estate  that
already  filed  an estate tax return or by putting a non-filing estate
over the threshold size that triggers the  duty  to  pay  estate  tax.
Under all of these articles, interest is required to be charged if the
tax  is late-paid (Tax Law § 990(b)(9), incorporating by reference Tax
Law § 683(c)(applicable to current article 26 and  former  article  26
for  estates  of decedents dying on or after May 25, 1990); former Tax
Law § 249-z (applicable to estates of  decedents  dying  on  or  after
September  1,  1930  and  before  May  25, 1990)). Executors and heirs
holding estate property can be held liable for estate tax  long  after
the  due  date  of  any  estate  tax return. For example, in regard to
estates of decedents dying on or after  May  25,  1990,  there  is  no
statute  of  limitations  for  imposing  additional  estate tax if the
estate did not  file  a  return  (Tax  Law  §  990,  incorporating  by
reference Tax Law § 684). In relation to estates of decedents dying on
or  after  September  1,  1930 and before May 25, 1990, former Tax Law
section 249-x applied, which  allowed  additional  estate  tax  to  be
determined  at  any  time based on unreported assets (former Tax Law
962(b) incorporating former Tax  Law  §  249x).    Moreover,  the  Tax
Department  continues to have collection authority under these present
and former estate tax articles in eases of late-discovered assets,  as
an  estate  tax lien attaches to estate property for specified periods
(e.g., Tax Law § 982(a)(fifteen year lien; former  Tax  Law  §  249-bb
(indefinite lien unless certain conditions are met)).
The  Abandoned  Property  Law  (APL)  requires  many entities, such as
banks, brokers, and utilities, and the court system, to turn  over  to
the  State Comptroller certain types of customer property held by them
after the passage of a specified period of inactivity. Since 1944, the
State  Comptroller  has  been  required  to  maintain  public  records
regarding  abandoned  property  that  has  been paid over to it (APL
1401). Prior to the enactment of Chapter 936 of the Laws of 1977,  the
State  Comptroller  was  not  authorized  to pay interest on abandoned
property. As amended by chapter 936, effective June 1, 1977,  the  APL
requires  the  State  Comptroller  to pay interest on certain types of
abandoned property, but only for the first five years the property  is
in  its  possession,  after  which the State Comptroller ceases to pay
interest (APL § 1405).
It is often difficult for an executor of an estate to discover all the
assets of the  decedent  within  the  time  allotted  for  filing  the
estate's  New  York  State estate tax return, which, under the current
estate tax, is nine months from  the  decedent's  date  of  death  (15
months   if   an  extension  is  received).  One  difficulty  is  that
fiduciaries holding assets not discovered by the executor cannot treat
such assets as abandoned property to  be  turned  over  to  the  State
Comptroller  until a statutorily set period of inactivity has expired,
which is often long after the estate's estate tax return is  due.  For
example,  the period of activity with regard to bank accounts is three
years (APL § 300). Despite the passage of time, the late discovery  of
an asset may trigger an estate tax liability if the estate tax statute
of  limitations  has  not  expired  (e.g.,  the estate had not filed a
return, in which case there is no  limitations  period  on  assessment
under  the  current  estate  tax).  The  Tax Department is required to
charge interest from the due date of the estate tax return that should
have included the asset until such time as the tax is paid.
While the interest charged to the estate can  be  sizable,  under  APL
section  1405,  the  State  Comptroller  only pays interest on certain
categories of  abandoned  property  and  even  then  it  only  accrues
interest  for  the  first  five  years  that  the property was in that
office's possession. Prior to that section's amendment  in  1977,  the
State Comptroller did not pay interest on any abandoned property.
In  recent  years, the State Comptroller has made efforts to encourage
people to search its records of abandoned property, now  available  as
searchable  web-based  databases.  As  a result, many people have been
able to find abandoned property formerly belonging to deceased persons
of whom they are heirs. The  problem  is  that  the  newly  discovered
estate asset often triggers an estate tax liability that the heir must
pay  because  the estate tax lien has not expired. The interest on the
estate  tax  liability  generated  by  the  late-discovered  abandoned
property is sometimes as much as five to ten times the tax owed, while
the State has often paid little or no interest on the property.
This  proposal  would  mitigate  this  inequity  by  directing the Tax
Department not  to  charge  interest  on  any  additional  estate  tax
liability  owed  by  an  estate based on the late-discovered asset for
periods in which the State Comptroller did not pay  interest  on  that
asset.  This  provision  would  not  apply  if the asset was listed as
abandoned property in the public  records  of  the  State  Comptroller
prior  to  the  due  date, with extensions, of the estate's estate tax
return and thus could have been discovered with due diligence  by  the
estate's executor.
Under  section  4 of the bill, no refunds or credits will be paid as a
This proposal will result in a revenue loss of up to $200,000 annually
beginning in SFY13-14.
Local impact:  None.
The bill would  take  effect  immediately  and  apply  to  estates  of
decedents dying on or after June 1, 1944.
S4310 - Bill Text
Introduced  by Sen. MARCELLINO -- (at request of the Department of Taxa-
tion and Finance) -- read twice and ordered printed, and when  printed
AN ACT to amend the tax law, in relation to making  a  reduced  rate  of
interest  applicable  to  certain  additions  to tax resulting from an
executor's discovery after the date for filing an estate tax return of
certain assets belonging to the decedent held by the state comptroller
as abandoned property; and to amend chapter 389 of the  laws  of  1997
amending  the  tax  law and other laws relating to the estate and gift
tax, and chapter 190 of the laws of 1990 amending the tax law relating
to certain taxes, fees, and other impositions, in relation to rates of
interest for certain estates
Section  1. The tax law is amended by adding a new section 991 to read
S 991. INTEREST ACCRUAL RELIEF  FOR  ADDITIONAL  TAX  ATTRIBUTABLE  TO
NEWLY-DISCOVERED ABANDONED PROPERTY. NOTWITHSTANDING ANY OTHER PROVISION
OF  LAW,  IN COMPUTING THE INTEREST DUE ON AN ADDITION TO TAX OWED BY AN
ESTATE ATTRIBUTABLE TO THE  INCLUSION  IN  THE  ESTATE'S  FEDERAL  GROSS
ESTATE  OF  AN  ASSET  HELD BY THE COMPTROLLER AS ABANDONED PROPERTY AND
ACCRUING INTEREST PURSUANT TO SECTION FOURTEEN HUNDRED FIVE OF THE ABAN-
DONED PROPERTY LAW, NO INTEREST SHALL ACCRUE FOR ANY PERIOD OF  TIME  IN
WHICH  THE  COMPTROLLER  CEASED TO PAY INTEREST ON THE ASSET PURSUANT TO
THE FIVE-YEAR LIMITATION IN SUBDIVISION ONE OF SECTION FOURTEEN  HUNDRED
FIVE OF THE ABANDONED PROPERTY LAW IF, AS OF THE DATE PRESCRIBED FOR THE
FILING  OF  A  RETURN REQUIRED BY THIS ARTICLE, INCLUDING ANY EXTENSIONS
GRANTED FOR FILING, INFORMATION PERTAINING TO  THE  ASSET  HAD  NOT  YET
APPEARED  IN  THE  PUBLIC  RECORDS  OF ABANDONED PROPERTY REQUIRED TO BE
LBD09097-01-3
S. 4310                             2
MAINTAINED BY THE COMPTROLLER PURSUANT TO SECTION FOURTEEN  HUNDRED  ONE
OF THE ABANDONED PROPERTY LAW.
S  2. Section 35 of part A of chapter 389 of the laws of 1997 amending
the tax law and other laws relating to  the  estate  and  gift  tax,  is
S  35.    All  provisions  of  law repealed or deleted by sections one
through thirty-four of this act, and of the regulations  adopted  there-
under,  in respect to the assessment, payment, determination, collection
and refund of taxes or other impositions imposed thereunder, the  filing
of returns and preservation of records for the purposes of such taxes or
impositions,  the  secrecy  of  returns, and the disposition of revenues
shall continue in effect with respect to all such taxes  or  impositions
accrued  up to the effective date of this section[.]; PROVIDED, HOWEVER,
THAT, WITH REGARD TO AN ADDITION TO TAX OWNED BY AN ESTATE  ATTRIBUTABLE
TO  THE  INCLUSION  IN THE ESTATE'S GROSS ESTATE OF AN ASSET HELD BY THE
STATE COMPTROLLER AS ABANDONED PROPERTY, NO INTEREST  SHALL  ACCRUE  FOR
ANY PERIOD OF TIME IN WHICH THE STATE COMPTROLLER CEASED TO PAY INTEREST
ON  THE  ASSET  PURSUANT  TO  THE FIVE-YEAR LIMITATION ON THE PAYMENT OF
INTEREST IN SUBDIVISION 1 OF SECTION 1405 OF THE ABANDONED PROPERTY LAW.
THIS CAP ON THE PERIOD OF TIME DURING WHICH INTEREST WILL  ACCRUE  SHALL
APPLY  ONLY  IF,  AS  OF THE DATE PRESCRIBED FOR THE FILING OF A RETURN,
INCLUDING ANY EXTENSIONS GRANTED FOR FILING, INFORMATION  PERTAINING  TO
THE  ASSET HAD NOT YET APPEARED IN THE PUBLIC RECORDS OF ABANDONED PROP-
ERTY REQUIRED TO BE MAINTAINED BY  THE  STATE  COMPTROLLER  PURSUANT  TO
SECTION 1401 OF THE ABANDONED PROPERTY LAW.
S  3.  Paragraph 1 of subdivision (i) of section 385 of chapter 190 of
the laws of 1990 amending the tax law relating to certain  taxes,  fees,
and  other impositions, as amended by section 71 of part A of chapter 56
(1) All provisions of articles 10-A, 10-B, 10-C and section 962 of the
tax law (as repealed by section  one  hundred  eight  of  this  act)  in
respect  to  the  imposition, rates, appraisal and valuation of estates,
filing of tax, assessment, determination, payment, collection and refund
of the taxes imposed or administered thereunder, the filing  of  reports
and  returns,  the  final federal determinations, imposition of interest
and penalties, the jurisdiction of surrogates' courts, provisions relat-
ing to appeals and the disposition of revenues and fees  shall  continue
in effect with respect to all such taxes accrued on or before the effec-
tive  date  of  this  act,  except that (A) section 249-u of the tax law
shall not be applicable after the effective date of this act,  (B)  with
respect  to any of the provisions of article 10-C thereof relating to an
appraiser, the appraiser shall  be  the  commissioner  of  taxation  and
finance  or  his  designee on and after such date, and (C) the fee for a
release of lien imposed by subdivision c of section  249-bb,  which  was
applicable  to  estates  of decedents subject to tax under article 26 of
the tax law by reason of section 962 thereof, shall not  be  applicable;
PROVIDED  THAT,  WITH  REGARD  TO  AN  ADDITION TO TAX OWED BY AN ESTATE
ATTRIBUTABLE TO THE INCLUSION IN THE ESTATE'S FEDERAL GROSS ESTATE OF AN
ASSET HELD BY THE STATE COMPTROLLER AS ABANDONED PROPERTY,  NO  INTEREST
SHALL  ACCRUE  FOR  ANY  PERIOD  OF  TIME IN WHICH THE STATE COMPTROLLER
CEASED TO PAY INTEREST ON THE ASSET PURSUANT TO THE FIVE-YEAR LIMITATION
ON THE PAYMENT OF INTEREST IN SUBDIVISION 1 OF SECTION 1405 OF THE ABAN-
DONED PROPERTY LAW. THIS CAP ON THE PERIOD OF TIME DURING WHICH INTEREST
WILL ACCRUE SHALL APPLY ONLY IF, AS  OF  THE  DATE  PRESCRIBED  FOR  THE
FILING  OF A RETURN, INCLUDING ANY EXTENSIONS GRANTED FOR FILING, INFOR-
MATION PERTAINING TO THE ASSET  HAD  NOT  YET  APPEARED  IN  THE  PUBLIC
S. 4310                             3
RECORDS  OF  ABANDONED  PROPERTY  REQUIRED TO BE MAINTAINED BY THE STATE
COMPTROLLER PURSUANT TO SECTION 1401 OF THE ABANDONED PROPERTY LAW;
S 4. This act shall take effect immediately and shall apply to estates
of decedents dying on or after June 1, 1944, provided that no refunds or
credit shall be granted as a result of any provision of this act.
S4310A (ACTIVE) - Details
2011-2012: A59602009-2010: A7916 S4310A (ACTIVE) - Summary
Makes a reduced rate of interest applicable to certain additions of tax resulting from discovery after filing an estate tax return of certain assets belonging to the decedent held by the state comptroller as abandoned property. S4310A (ACTIVE) - Sponsor Memo
BILL NUMBER:S4310A
which the State Comptroller did not pay interest on the asset  if,  at
dying when prior versions of the New York estate tax were  in  effect.
in effect (which was repealed by Chapter 389 of the Laws of 1997).
Section 3 would apply the limitation to estates of decedents dying  on
or  after  June  1,  1944, the date on which the State Comptroller was
first required to maintain public lists  of  abandoned  property,  and
before  April  1,  1963,  during  which  .period former Article 10-C's
estate tax was in effect, prior to  its  being  superseded  by  former
Article 26, pursuant to Chapter 1013 of the Laws of 1962.
the  State  Comptroller  was  required  to  maintain public records of
abandoned property. Section 4 also would provide that  no  refunds  or
The  discovery  of  assets  after  the  date prescribed for paying the
liability,  either  by  increasing  the  tax  due  from an estate that
tax  is  late-paid  (Tax Law § 990-b 9, incorporating by reference Tax
Law 5 683-c applicable to current article 26 and former article-26 for
estates of decedents dying on or after May 25, 1990; former Tax Law
249-z  applicable  to estates of decedents dying on or after September
1, 1930 and before May 25, 1990). Executors and heirs  holding  estate
property  can be held liable for estate tax long after the due date of
any estate tax return. For example, in regard to estates of  decedents
dying on or after May 25, 1990, there is no statute of limitations for
imposing  additional  estate  tax  if the estate did not file a return
(Tax Law § 990, incorporating by reference Tax Law § 684). In relation
to estates of decedents dying on or after September 1, 1930 and before
May 25, 1990, former Tax Law  section  249-x  applied,  which  allowed
additional estate tax to be determined at any time based on unreported
assets  (former  Tax Law § 962b incorporating former Tax Law § 249-z).
Moreover, the Tax Department continues to  have  collection  authority
under  these  present  and  former  estate  tax  articles  in eases of
late-discovered assets, as an  estate  tax  lien  attaches  to  estate
property  for  specified  periods  (e.g., Tax Law § 982-a fifteen year
lien;  former  Tax  Law  §  249-bb  indefinite  lien  unless   certain
banks, brokers, arid utilities, and the court system, to turn over  to
,regarding  abandoned  property  that  has been paid over to it (APL
fiduciaries holding assets not discovered by-the executor cannot treat
have included the asset until such time as the tax is maid.
While  the  interest  charged  to the estate can be sizable, under APL
section 1405, the State Comptroller  only  pays  interest  on  certain
categories  of  abandoned  property  and  even  then  it  only accrues
interest for the first five  years  that  the  property  was  in  that
office's possession.
Prior  to  that section's amendment in 1977, the State Comptroller did
not pay interest on any abandoned property.
In recent years, the State Comptroller has made efforts  to  encourage
people  to  search its records of abandoned property, now available as
searchable web-based databases. As a result,  many  people  have  been
of  whom  they  are  heirs.  The  problem is that the newly discovered
pay because the estate tax lien has not expired. The interest  on  the
This proposal would  mitigate  this  inequity  by  directing  the  Tax
Department  not  to  charge  interest  on  any  additional  estate tax
liability owed by an estate based on  the  late-discovered  asset  for
periods  in  which  the State Comptroller did not pay interest on that
asset. This provision would not apply  if  the  asset  was  listed  as
abandoned  property  in  the  public  records of the State Comptroller
prior to the due date, with extensions, of  the  estate's  estate  tax
return  and  thus could have been discovered with due diligence by the
Under section 4 of the bill, no refunds or credits will be maid  as  a
This proposal will result in a revenue loss of up to $400,000 annually
The  bill  would  take  effect  immediately  and  apply  to estates of
S4310A (ACTIVE) - Bill Text
4310--A
ESTATE  OF  AN  ASSET HELD BY THE COMPTROLLER AS ABANDONED PROPERTY, THE
COMMISSIONER SHALL APPLY THE INTEREST  RATE  USED  BY  THE  COMPTROLLER,
PURSUANT TO SECTION FOURTEEN HUNDRED FIVE OF THE ABANDONED PROPERTY LAW,
IN  COMPUTING  THE  INTEREST DUE ON SUCH ABANDONED PROPERTY WHILE IN THE
COMPTROLLER'S POSSESSION (INCLUDING A ZERO RATE IF THE  COMPTROLLER  DID
NOT PAY INTEREST ON SUCH PROPERTY) IF, AS OF THE DATE PRESCRIBED FOR THE
LBD09097-03-3
S. 4310--A                          2
THAT, IN COMPUTING THE INTEREST DUE ON AN ADDITION TO  TAX  OWED  BY  AN
ESTATE  ATTRIBUTABLE TO THE INCLUSION IN THE ESTATE'S GROSS ESTATE OF AN
ASSET HELD BY THE STATE COMPTROLLER AS ABANDONED PROPERTY,  THE  COMMIS-
SIONER OF TAXATION AND FINANCE SHALL APPLY THE INTEREST RATE USED BY THE
COMPTROLLER,  PURSUANT TO SECTION 1405 OF THE ABANDONED PROPERTY LAW, IN
COMPUTING THE INTEREST DUE ON SUCH ABANDONED PROPERTY WHILE IN THE COMP-
TROLLER'S POSSESSION (INCLUDING A ZERO RATE IF THE COMPTROLLER  DID  NOT
PAY  INTEREST  ON  SUCH  PROPERTY) IF, AS OF THE DATE PRESCRIBED FOR THE
FILING OF A RETURN, INCLUDING ANY EXTENSIONS GRANTED FOR FILING,  INFOR-
MATION  PERTAINING  TO  THE  ASSET  HAD  NOT  YET APPEARED IN THE PUBLIC
RECORDS OF ABANDONED PROPERTY REQUIRED TO BE  MAINTAINED  BY  THE  STATE
COMPTROLLER PURSUANT TO SECTION 1401 OF THE ABANDONED PROPERTY LAW.
SHALL  ACCRUE  FOR ANY PERIOD OF TIME IN WHICH THE STATE COMPTROLLER DID
NOT PAY INTEREST ON THE ASSET IF, AS OF  THE  DATE  PRESCRIBED  FOR  THE