2023 New York Laws › TAX - Tax › Article 36 - Compliance and Enforcement Initiatives › 1701 - Financial Institution Data Match System for State Tax Collection Purposes.

§  1701.  Financial  institution  data  match  system  for  state  tax
collection purposes. 1. Definitions. As used in this section:
* (a) "Debt" means past-due tax  liabilities,  including  unpaid  tax,
interest,  and  penalty,  that  the  commissioner  is required by law to
collect and that have become fixed and final such that the  taxpayer  no
longer has any right to administrative or judicial review.
* NB Effective until April 1, 2025
* (a)  "Debt"  means  all liabilities, including unpaid tax, interest,
and penalty, that the commissioner is required by  law  to  collect  and
that  have been reduced to judgment by the docketing of a New York state
tax warrant in the office of a county clerk located in the state of  New
York  or  by  the  filing  of a copy of the warrant in the office of the
department of state.
* NB Effective April 1, 2025
(b) "Tax debtor" means a natural person or any  entity  other  than  a
natural  person  named  on  a  New York state tax warrant and identified
thereon as a judgment debtor.
(c)  "Financial  institution"  means  (i)  any  financial  institution
authorized  or  required  to participate in a financial institution data
match system or program for child  support  enforcement  purposes  under
federal or state law, and (ii) any virtual currency business licensed by
the superintendent of financial services.
2.  Financial  institution  data match system for state tax collection
purposes.  * (a) To assist the commissioner in the collection of  debts,
the  department  must  develop  and operate a financial institution data
match system for the purpose of identifying and seizing  the  non-exempt
assets   of   tax   debtors  as  identified  by  the  commissioner.  The
commissioner is authorized to designate a third  party  to  develop  and
operate  this  system.  Notwithstanding  any  other  provisions  of this
chapter, the commissioner is authorized to disclose  the  debt  and  the
debtor information to such third party and to financial institutions for
purposes  of this system. Any third party designated by the commissioner
to develop and operate a financial  data  match  system  must  keep  all
information  it  obtains  from  both  the  department  and the financial
institution confidential, and any employee, agent or  representative  of
that  third  party  is  prohibited  from  disclosing that information to
anyone other than the department or the financial institution.
* NB Effective until April 1, 2025
* (a) To assist the commissioner  in  the  collection  of  debts,  the
department  must  develop and operate a financial institution data match
system for the purpose of identifying and seizing the non-exempt  assets
of  tax  debtors  as identified by the commissioner. The commissioner is
authorized to designate a  third  party  to  develop  and  operate  this
system.  Any  third  party designated by the commissioner to develop and
operate a financial data match  system  must  keep  all  information  it
obtains   from   both  the  department  and  the  financial  institution
confidential, and any employee, agent or representative  of  that  third
party  is  prohibited  from  disclosing that information to anyone other
than the department or the financial institution.
* NB Effective April 1, 2025
(b) Each financial institution doing business in the  state  must,  in
conjunction  with  the  commissioner  or  the  commissioner's authorized
designee, develop and operate a data  match  system  to  facilitate  the
identification and seizure of non-exempt financial assets of tax debtors
identified   by   the  commissioner  or  the  commissioner's  authorized
designee. If a financial institution has a data match  system  developed
or  used  to  administer  the child support enforcement programs of this
state, and if that  system  is  approved  by  the  commissioner  or  the

commissioner's  authorized  designee,  the financial institution may use
that system to comply with the provisions of this section.
3.  Each  financial  institution  must provide identifying information
each calendar quarter to the department for each tax  debtor  identified
by  the  department who or that maintains an account at the institution.
The identifying information must include the tax debtor's name, address,
and social security number or other taxpayer identification number,  and
all account numbers and balances in each account.
4. A financial institution that complies with this section will not be
liable  under  state law to any person for the disclosure of information
to the commissioner or the commissioner's authorized  designee,  or  any
other action taken in good faith to comply with this section.
5.   Both  the  financial  institution  furnishing  a  report  to  the
commissioner  under  this  section  and  the  commissioner's  authorized
designee  are prohibited from disclosing to the tax debtor that the name
of  the  tax  debtor  has  been  received  from  or  furnished  to   the
commissioner, unless authorized in writing by the commissioner to do so.
A violation of this subdivision will result in the imposition of a civil
penalty  equal  to  the greater of one thousand dollars or the amount in
the account of the person to whom  the  disclosure  was  made  for  each
instance  of  unauthorized disclosure by the financial institution. That
civil penalty can be assessed and collected under  this  chapter  as  if
that penalty were tax.
6.  A  financial institution may disclose to its depositors or account
holders that  the  department  has  the  authority  to  request  certain
identifying  information  on certain depositors or account holders under
the financial institution data match system  for  state  tax  collection
purposes.