NY Tax L § 1138 (2021)
2021 New York Laws TAX - Tax Article 28 - Sales and Compensating Use Taxes Part 4 - Administrative Provisions 1138 - Determination of Tax.

§  1138.  Determination  of  tax. (a) (1) If a return required by this article is not filed,  or  if  a  return  when  filed  is  incorrect  or insufficient,  the  amount  of  tax  due  shall  be  determined  by  the commissioner from such information as may be  available.  If  necessary, the tax may be estimated on the basis of external indices, such as stock on  hand,  purchases,  rental  paid, number of rooms, location, scale of rents or charges, comparable rents or charges,  type  of  accommodations and service, number of employees or other factors. In the case of retail food  stores  and  other  participants approved for participation in the federal food stamp program under or pursuant to the federal  food  stamp act  of  nineteen  hundred  seventy-seven  (7 U.S.C. § 2011 et seq.), as amended, whose records are incomplete or inadequate  to  determine  tax, the  external indices upon which tax may be estimated and determined may also  include  information  contained  in   applications,   updates   of applications,  redemption  certificates,  returns and reports which such retail food stores and other participants furnish to or are furnished by the United States government or this state or their  agencies  in  order for such retail food stores and other participants to participate in the food stamp program or to redeem coupons issued under or pursuant to such food  stamp act and any other available information considered relevant. Notice of such determination shall be mailed to the  person  or  persons liable   for  the  collection  or  payment  of  the  tax.  A  notice  of determination shall be mailed by certified or  registered  mail  to  the person or persons liable for the collection or payment of the tax at his last known address in or out of this state. If such person or persons is deceased  or  under a legal disability, a notice of determination may be mailed to his last known address in or out of  this  state,  unless  the department   has  received  notice  of  the  existence  of  a  fiduciary relationship with respect to the taxpayer. After ninety  days  from  the mailing of a notice of determination, such notice shall be an assessment of  the  amount  of  tax  specified  in  such  notice, together with the interest, additions to tax and penalties stated in such  notice,  except only  for  any  such  tax  or other amounts as to which the taxpayer has within such ninety day period applied to the division of tax appeals for a  hearing,  or  unless  the  commissioner  of  his  own  motion   shall redetermine  the  same. If the notice of determination is addressed to a person outside of the United States, such period shall  be  one  hundred fifty days instead of ninety days.  (2)  Whenever  such  tax is estimated as provided for in this section, such notice shall contain a statement in bold  face  type  conspicuously placed  on such notice advising the taxpayer: that the amount of the tax was estimated; that the tax may be challenged through a hearing process; and that the petition for such challenge must  be  filed  with  the  tax commission within ninety days.  (3)  (A)  The  liability  of  a  purchaser,  transferee or assignee of business assets sold, transferred or assigned in bulk for the payment to the state of taxes determined to be due from the seller,  transferor  or assignor  arising  under  subdivision  (c)  of  section  eleven  hundred forty-one of this chapter  shall  be  an  assessment  of  the  liability determined  unless  the purchaser, transferee or assignee, within ninety days after the giving of notice by the tax commission to such purchaser, transferee or assignee of the total amount of any tax or taxes which the state claims to be due from the seller, transferor  or  assignor,  shall apply  to the tax commission for a hearing or unless the tax commission, on its own motion, shall  redetermine  such  liability.  Where  the  tax commission  determines  that  the amount of taxes claimed to be due from the seller, transferor or assignor is erroneous or excessive in whole or in part it shall, on behalf of the purchaser,  transferee  or  assignee,  determine  the amount of tax or taxes properly due and if such amount is less than the amount of taxes for which the purchaser  would  have  been liable  in  the  absence  of  such  determination  it  shall reduce such liability  accordingly.  The  commission  may,  on its motion, abate, on behalf of the purchaser, transferee or assignee, any part of  the  taxes determined  to  be erroneous or excessive, whether or not such taxes had become finally and irrevocably fixed.  (B) The liability, pursuant  to  subdivision  (a)  of  section  eleven hundred  thirty-three  of  this  article,  of  any  officer, director or employee of a corporation or  of  a  dissolved  corporation,  member  or employee  of  a  partnership or employee of an individual proprietorship who as such officer, director, employee or member is under a duty to act for  such  corporation,  partnership  or  individual  proprietorship  in complying  with  any  requirement  of  this article for the tax imposed, collected or required to be collected, or for the  tax  required  to  be paid  or  paid  over  to  the tax commission under this article, and the amount of such tax liability (whether or not a  return  is  filed  under this  article,  whether  or  not  such return when filed is incorrect or insufficient, or where the tax shown to be due on the return filed under this article has not been paid or has not been paid in  full)  shall  be determined  by  the  tax  commission  in  the  manner  provided  for  in paragraphs one and two of this subdivision. Such determination shall  be an  assessment of the tax and liability for the tax with respect to such person unless such person, within ninety days after the giving of notice of such determination, shall apply to the division of tax appeals for  a hearing.    If  such  determination  is  identical to or arises out of a previously issued determination of tax  of  the  corporation,  dissolved corporation,  partnership  or  individual  proprietorship for which such person is under a duty to act, an application filed with the division of tax  appeals  on  behalf  of  the  corporation,  dissolved  corporation, partnership  or individual proprietorship shall be deemed to include any and all subsequently  issued  personal  determinations  and  a  separate application  to  the  division of tax appeals for a hearing shall not be required. The tax commission  may,  nevertheless,  of  its  own  motion, redetermine  such  determination  of tax or liability for tax. Where the tax commission determines or redetermines that the amount of tax claimed to be due from a vendor of tangible personal  property  or  services,  a recipient  of  amusement charges, or an operator of a hotel is erroneous or excessive in whole or in part, it shall redetermine the amount of tax properly due from any such person as a person required  to  collect  tax with  respect to such vendor, recipient, or operator, and if such amount is less than the amount of tax for which such  person  would  have  been liable in the absence of such determination or redetermination, it shall reduce  such liability accordingly. Furthermore, the tax commission may, of its own motion, abate on behalf of any such person, any part  of  the tax  determined to be erroneous or excessive whether or not such tax had become finally and irrevocably fixed with respect to such person but  no claim  for  abatement may be filed by any such person. The provisions of this paragraph shall not be construed to limit in any manner the  powers of  the attorney general under subdivision (a) of section eleven hundred forty-one or the powers of the tax commission to issue a  warrant  under subdivision  (b)  of such section against any person whose liability has become finally and irrevocably fixed.  (C) The liability of any person as an owner of a filling station,  for the   penalty   imposed  by  subparagraph  (vii)  of  paragraph  one  of subdivision (a) of section eleven hundred forty-five, and the amount  of such   penalty   shall   be  determined  by  the  tax  commission.  Such determination shall be an assessment of the amount of and liability  for  penalty  with  respect  to such person unless such person, within ninety days after the giving of notice of such determination,  shall  apply  to the  tax commission for a hearing. The tax commission may, nevertheless, of  its  own  motion,  redetermine  such  determination or liability for penalty. Furthermore, the tax commission may, of its own  motion,  abate any  part of the penalty determined to be erroneous or excessive whether or not such penalty  has  become  finally  and  irrevocably  fixed  with respect  to  such  person but no claim for abatement may be filed by any such person. The provisions of this paragraph shall not be construed  to limit in any manner the powers of the attorney general under subdivision (a) of section eleven hundred forty-one of this article or the powers of the  tax  commission  to  issue  a warrant under subdivision (b) of such section against any  person  whose  liability  has  become  finally  and irrevocably fixed.  (D)  The  liability  of any person, as an owner of a place of business selling cigarettes at retail, for the penalty  imposed  by  subparagraph (viii)  of  paragraph  one  of subdivision (a) of section eleven hundred forty-five of this article and the  amount  of  such  penalty  shall  be determined   by   the  commissioner.  Such  determination  shall  be  an assessment of the amount of and liability for such penalty with  respect to  such person, unless such person, within ninety days after the giving of notice of such determination, shall apply  to  the  division  of  tax appeals  for  a  hearing.  The  commissioner  may,  nevertheless, on the commissioner's own motion, redetermine such determination.  Furthermore, the  commissioner  may, on the commissioner's own motion, abate any part of the penalty determined to be erroneous or excessive  whether  or  not such  penalty  has  become finally and irrevocably fixed with respect to such person; but no claim for abatement may be filed by any such person. The provisions of this paragraph shall not be construed to limit in  any manner  the  powers  of  the  attorney  general under subdivision (a) of section eleven hundred forty-one of this article or the  powers  of  the commissioner  to  issue  a warrant under subdivision (b) of such section against any person whose liability has become  finally  and  irrevocably fixed.  (E)  In  addition  to any other liability a credit card issuer or fuel distributor may have, the commissioner shall determine any or all of the following liabilities: (1) any tax, interest or penalty liability  of  a credit  card issuer or fuel distributor for any credit allowed or refund paid under subdivision (h) of section eleven hundred thirty-nine of this part which was erroneously, illegally or unconstitutionally  allowed  or paid  to such credit card issuer or fuel distributor, or (2) the penalty imposed by subparagraph (ix) of paragraph  one  of  subdivision  (a)  of section  eleven  hundred  forty-five of this part. In any such instance, the commissioner shall give the credit card issuer or  fuel  distributor notice  of  such  determination in the manner described in paragraph one and two of this subdivision. Such determination shall be  an  assessment of   any   such  liability  unless  such  credit  card  issuer  or  fuel distributor, within ninety days after the  giving  of  such  notice  and determination,  shall  apply  to  the  commissioner  for  a hearing. The commissioner may, nevertheless, of his or her  own  motion,  redetermine such   determination   or   liability   for  penalty.  Furthermore,  the commissioner may, of his or her  own  motion,  abate  any  part  of  the penalty  determined  to  be  erroneous  or excessive whether or not such penalty has become finally and irrevocably fixed with  respect  to  such issuer  or  fuel  distributor  but no claim of abatement may be filed by such issuer or fuel distributor. The provisions of this paragraph  shall not  be  construed  to  limit  in  any manner the powers of the attorney general under subdivision (a) of section  eleven  hundred  forty-one  of  this  part  or  the  powers of the commissioner to issue a warrant under subdivision (b)  of  such  section  against  any  such  issuer  or  fuel distributor whose liability has become finally and irrevocably fixed.  (4)  After  the hearing provided for in paragraph one or three of this subdivision, the division of tax appeals shall give notice  promptly  by registered  or certified mail of the determination of the administrative law judge to the petitioner and to  the  commissioner  of  taxation  and finance.  Such determination may be reviewed by the tax appeals tribunal as provided in article forty of this chapter. The decision  of  the  tax appeals  tribunal  may  be  reviewed as provided in section two thousand sixteen of this chapter. Such a proceeding for judicial review shall not be instituted unless the amount of any tax sought to be  reviewed,  with penalties  and  interest  thereon, if any, shall be first deposited with the commissioner of taxation and finance and there shall be  filed  with the  commissioner  of  taxation  and finance an undertaking, issued by a surety company  authorized  to  transact  business  in  this  state  and approved by the superintendent of financial services of this state as to solvency  and responsibility, in such amount as a justice of the supreme court shall approve to the effect that if such proceeding  be  dismissed or the tax confirmed the petitioner will pay all costs and charges which may accrue in the prosecution of the proceeding, or at the option of the petitioner  such undertaking filed with the commissioner of taxation and finance may be in a sum sufficient to cover  the  taxes,  penalties  and interest thereon stated in such determination plus the costs and charges which  may  accrue  against him in the prosecution of the proceeding, in which event the petitioner shall not be required to deposit such  taxes, penalties  and  interest as a condition precedent to the commencement of the proceeding. The preceding sentence shall not apply to  a  proceeding brought  to  review  a  determination  made  under  subparagraph  (B) of paragraph three of this subdivision.  (b) If the tax commission believes that the collection of any tax will be jeopardized by delay it may determine the  amount  of  such  tax  and assess  the  same,  together with all interest and penalties provided by law, against any person liable therefor  prior  to  the  filing  of  his return  and  prior  to the date when his return is required to be filed. The amount so determined  shall  become  due  and  payable  to  the  tax commission  by  the  person  against  whom such a jeopardy assessment is made, as soon as notice  thereof  is  given  to  him  personally  or  by registered  or certified mail. The provisions of subdivision (a) of this section shall apply to any such determination except to the extent  that they  may  be  inconsistent with the provisions of this subdivision. The tax commission may abate  any  jeopardy  assessment  if  it  finds  that jeopardy  does  not exist. The collection of any jeopardy assessment may be stayed by filing with the tax commission a bond issued  by  a  surety company  authorized  to  transact business in this state and approved by the  superintendent  of  financial   services   as   to   solvency   and responsibility,  conditioned  upon  payment  of  the amount assessed and interest thereon, or any lesser amount to which such assessment  may  be reduced  by  the  tax  commission  or  by  a  proceeding  under  article seventy-eight of the  civil  practice  law  and  rules  as  provided  in subdivision (a), such payment to be made when the assessment or any such reduction  thereof  shall  have  become final and not subject to further review. If such a bond  is  filed  and  thereafter  a  proceeding  under article  seventy-eight  is  commenced  as  provided  in subdivision (a), deposit of the taxes, penalties  and  interest  assessed  shall  not  be required   as   a  condition  precedent  to  the  commencement  of  such proceeding. Where a jeopardy assessment is made, any property seized for the collection of the tax shall not be sold (1) until expiration of  the  time  to  apply  for  a  hearing  as provided in subdivision (a) of this section, and  (2)  if  such  application  is  timely  filed,  until  the expiration  of  four months after the tax commission has given notice of its  determination  to  the  person against whom the assessment is made; provided, however, such property may be sold at any time if such  person has failed to attend a hearing of which he has been duly notified, or if he  consents  to  the sale, or if the tax commission determines that the expenses of conservation and maintenance will  greatly  reduce  the  net proceeds, or if the property is perishable.  (c) A person liable for collection or payment of tax (whether or not a determination  assessing  a  tax  pursuant  to  subdivision  (a) of this section has been issued) shall be entitled to have a  tax  due  assessed prior  to  the  ninety-day period referred to in subdivision (a) of this section, by filing  with  the  tax  commission  a  signed  statement  in writing,  in such form as the tax commission shall prescribe, consenting thereto.  (d) Except as otherwise provided in subdivision (a) of  this  section, the  provisions of this section shall not be applicable to the liability of a purchaser, transferee or assignee arising under the  provisions  of subdivision (c) of section eleven hundred forty-one of this chapter.