2023 New York Laws › TAX - Tax › Article 27 - Corporate Tax Procedure and Administration › 1088 - Interest on Overpayment.

§  1088.  Interest  on overpayment.--(a) General.--Notwithstanding the
provisions of section sixteen of the state finance law,  interest  shall
be  allowed  and  paid  as  follows  at  the overpayment rate set by the
commissioner of taxation and finance pursuant to  section  one  thousand
ninety-six,  or  if no rate is set, at the rate of six percent per annum
upon any overpayment in respect of the tax imposed by  article  nine  or
nine-a:
(1)  from  the  date  of  the overpayment to the due date of an amount
against which a credit is taken;
(2) from the date of the overpayment to a date (to  be  determined  by
the  commissioner) preceding the date of a refund check by not more than
thirty days, whether or  not  such  refund  check  is  accepted  by  the
taxpayer  after  tender of such check to the taxpayer. The acceptance of
such check shall be without prejudice to any right of  the  taxpayer  to
claim any additional overpayment and interest thereon.
(3)  Late  and  amended  returns  and  claims  for  credit  or refund.
Notwithstanding paragraph one or two of this subsection, in the case  of
an  overpayment claimed on a return of tax which is filed after the last
date prescribed for  filing  such  return  (determined  with  regard  to
extensions),  or  claimed  on  an  amended return of tax or claimed on a
claim for credit or refund, no interest shall be allowed or paid for any
day before the date on which such return or claim is filed.
(4) Interest on  certain  refunds.  To  the  extent  provided  for  in
regulations  promulgated by the commissioner of taxation and finance, if
an item of income, gain, loss, deduction or credit is changed  from  the
taxable  year  or  period in which it is reported to the taxable year or
period in which it belongs and the change results in an underpayment  in
a  taxable  year or period and an overpayment in some other taxable year
or period, the provisions of paragraph three  of  this  subsection  with
respect to an overpayment shall not be applicable to the extent that the
limitation  in such paragraph on the right to interest would result in a
taxpayer not being allowed interest for a length of time with respect to
an overpayment while being required to pay  interest  on  an  equivalent
amount of the related underpayment. However, this paragraph shall not be
construed  as  limiting  or  mitigating  the  effect  of  any statute of
limitations or any other provision of law relating to the  authority  of
such  commissioner  to issue a notice of deficiency or to allow a credit
or refund on an overpayment.
(5) Amounts of less than five dollars. No interest shall be allowed or
paid if the amount thereof is less than five dollars.
(b) Advance payment of  tax  and  estimated  tax.--The  provisions  of
subsections  (h) and (i) of section one thousand eighty-seven applicable
in determining the date of payment of tax for  purposes  of  determining
the  period  of  limitations on credit or refund, shall be applicable in
determining the date of payment for purposes of this section.
(c) Tax refund within three months of claim for  overpayment.  (1)  If
any  overpayment of tax imposed by article nine or nine-a is credited or
refunded  within  three  months  after  the  last  date  prescribed  (or
permitted  by  extension  of  time) for filing the return of such tax on
which such overpayment was claimed or within  three  months  after  such
return  was  filed,  whichever is later, or within three months after an
amended return was filed  claiming  such  overpayment  or  within  three
months  after  a  claim  for  credit  or  refund was filed on which such
overpayment was claimed, no interest shall be allowed under this section
on any such overpayment. For purposes of this  subsection,  any  amended
return  or  claim  for  credit  or  refund  filed  before  the  last day
prescribed (or permitted by extension of time) for  the  filing  of  the

return  of  tax  for such year or period shall be considered as filed on
such last day.
(2)  In  the  case of an overpayment of tax credited due to absence of
application by the taxpayer for refund under subsection (a)  of  section
one  thousand  eighty-six,  where the commissioner notifies the taxpayer
that such overpayment has been so credited within three months after the
last date prescribed (or permitted by extension of time) for filing  the
return of such tax on which such overpayment was claimed or within three
months  after  such  return was filed, whichever is later, and where the
taxpayer subsequent to such notice makes a claim for refund  of  all  or
part  of  such  overpayment,  no  interest  shall  be allowed under this
section prior to the date of such claim for refund.
(d) Refund of tax caused by carryback.--For purposes of this  section,
if  any  overpayment  of  tax  imposed  by article nine-a results from a
carryback  of  a  net  operating  loss  or  a  net  capital  loss,  such
overpayment  shall  be  deemed not to have been made prior to the filing
date for the taxable year in  which  such  net  operating  loss  or  net
capital  loss  arises.  In  the  case  of  a  taxpayer which has made an
election under subchapter s of chapter one of the internal revenue code,
where an overpayment of tax results from a carryback of a net  operating
loss arising in a taxable year ending on or after December thirty-first,
nineteen  hundred seventy-six, or from a carryback of a net capital loss
arising in a taxable year ending  on  or  after  December  thirty-first,
nineteen  hundred  eighty-one,  unless  a claim for refund based on such
overpayment has been filed within a period ending twelve months and  one
hundred  eighty  days  subsequent to the last day of the taxable year in
which the net operating loss or net capital loss arises, interest on any
resulting refund or credit shall cease to accrue upon the conclusion  of
such  period.  Such  filing  date  shall be determined without regard to
extensions of time to file. For  purposes  of  subsection  (c)  of  this
section  any  overpayment  described  herein  shall  be  treated  as  an
overpayment for the loss year and such subsection shall be applied  with
respect  to such overpayment by treating the return for the loss year as
not filed before claim for such overpayment is  filed.  The  term  "loss
year" means the taxable year in which such loss arises.
(e) No interest until return in processible form.--
(1)  For purposes of subsections (a) and (c) of this section, a return
shall not be treated as filed until it is filed in processible form.
(2) For purposes of paragraph one of this subsection, a return is in a
processible form if--
(A) such return is filed on a permitted form, and
(B) such return contains--
(i) the taxpayer's name, address,  and  indentifying  number  and  the
required signatures, and
(ii)  sufficient  required  information  (whether  on the return or on
required attachments) to permit the  mathematical  verification  of  tax
liability shown on the return.
(f)   Overpayment   credited   against  past-due  legally  enforceable
debts.--If interest is payable pursuant to this section on that  portion
of an overpayment which is certified by the commissioner of taxation and
finance  to  the  comptroller  as  the  amount  to be credited against a
past-due legally enforceable debt pursuant to the provisions of  section
one  hundred  seventy-one-f  of  this chapter, or a city of New York tax
warrant judgment debt pursuant to the provisions of section one  hundred
seventy-one-l of this chapter, such portion of such an overpayment shall
cease to bear interest on the date of such certification.
(g)  Cross-reference.--For  provision  with  respect to interest after
failure to file a report or amended return under  subdivision  three  of

section  two  hundred  eleven  or  paragraph  one  of subdivision (e) of
section fifteen hundred fifteen,  see  subsection  (c)  of  section  one
thousand eighty-seven.
(h)  Notwithstanding  any other provision in this section, for taxable
years beginning on or after January first, two thousand eight and before
January first, two  thousand  nine,  interest  will  be  allowed  on  an
overpayment on any return or report on which one or more empire zone tax
credits  are  claimed, only from the one hundred eightieth day after the
taxpayer files with the department an empire zone retention  certificate
issued pursuant to subdivision (w) of section nine hundred fifty-nine of
the  general  municipal  law  to the empire zone enterprise which is the
basis for the tax credit or credits claimed on the return or report.