2023 New York Laws › TAX - Tax › Article 1 - Short Title; Definitions; Miscellaneous › 32 - Registration of Tax Return Preparers.

§  32.  Registration of tax return preparers. (a) For purposes of this
section, the following terms have the specified meanings:
(1) "Attorney" means an attorney admitted to practice law in New  York
state  or one or more of the other states or jurisdictions of the United
States.
(2)  "Certified  public  accountant"  means  an  accountant   licensed
pursuant  to section seventy-four hundred four of the education law or a
similar law of one or more of the other states or jurisdictions  of  the
United States.
(3) "Commercial tax return preparer" means a tax return preparer who:
(A)  prepared  ten  or  more returns for compensation in the preceding
calendar year and will prepare at  least  one  return  for  compensation
during the current calendar year; or (B) prepared fewer than ten returns
in  the preceding calendar year but will prepare ten or more returns for
the current calendar year.
(4) "Commercial tax return preparation business" means an entity  that
employs   individuals  who  prepare  tax  returns  and  that  meets  the
thresholds described in paragraph three of this subdivision.
(5) "Creditor" means any person who makes a refund  anticipation  loan
or who takes an assignment of a refund anticipation loan.
(6) "Facilitator" means a person who individually or in conjunction or
cooperation   with  another  person:  (a)  solicits  the  execution  of,
processes, receives, or accepts an application or agreement for a refund
anticipation loan or refund anticipation check, (b) serves  or  collects
upon  a refund anticipation loan or refund anticipation check; or (c) in
any other manner facilitates the making of a refund anticipation loan or
refund anticipation  check.  This  term  excludes  any  employees  of  a
facilitator  who  provide  only  clerical  or  other  comparable support
services to such facilitator.
(7) "Electronic" means computer technology.
(8) "Enrolled agent" means an agent enrolled to  practice  before  the
internal  revenue  service pursuant to section 10.4 of subpart A of part
ten of title thirty-one of the code of federal regulations.
(9) "Public accountant"  means  an  accountant  licensed  pursuant  to
section  seventy-four hundred five of the education law or a similar law
of one or more of the  other  states  or  jurisdictions  of  the  United
States.
(10)  "Refund anticipation check" means a check, stored value card, or
other payment mechanism which: (a) represents  the  proceeds  of  a  tax
refund;  (b) was issued by a depository institution or other person that
received a direct deposit of the tax refund or tax credits;  and  (c)  a
fee or other consideration is paid for such payment mechanism.
(11)  "Refund  anticipation  loan"  means a loan that is secured by or
that the creditor arranges to be repaid directly or indirectly from  the
proceeds  of  an income tax refund or tax credits. A refund anticipation
loan also includes any sale, assignment, or purchase of tax refund at  a
discount  or  for  a  fee,  whether  or not the amount is required to be
repaid to the buyer or assignee if the internal revenue service  or  the
department denies or reduces the amount of the tax refund.
(12)  "Return" means a return or report relating to a tax administered
by the commissioner.
(13) "Tax" means any tax, fee, special assessment or other  imposition
administered by the commissioner.
(14)  "Tax  return  preparer"  means  an  individual  who  prepares  a
substantial portion of any return for compensation. Employees of  a  tax
return  preparer  or  a  commercial  tax return preparation business who
prepare returns for clients of that preparer or preparation business, as
applicable,  and  partners  who  prepare  returns  for  clients   of   a

partnership engaged in a commercial tax return preparation business, are
all  "tax  return preparers" for purposes of this section. Excluded from
the  definition  of  "tax  return  preparer"   are   attorneys,   public
accountants,  enrolled  agents,  and  certified  public accountants, and
employees of an attorney, public accountant, enrolled  agent,  certified
public   accountant,   or  firm  thereof  preparing  returns  under  the
supervision of such  attorneys,  public  accountants,  certified  public
accountants  and  enrolled  agents  or  firms thereof. Also excluded are
volunteer tax preparers, employees  of  a  business  or  partners  in  a
partnership  whose  job responsibilities include preparation of only the
business' or partnership's  returns,  and  employees  of  a  tax  return
preparer  or  a  commercial tax return preparation business who provides
only clerical or other comparable services.
(b)(1) Each tax return preparer, who will prepare at least one  return
in a calendar year, and each facilitator, who will facilitate the making
of  a  refund  anticipation  loan  or  refund  anticipation  check, must
register electronically with the department for that calendar  year,  in
accordance with instructions prescribed by the commissioner.
(2)(A)  Upon  completion  of the registration process, each tax return
preparer and facilitator will be issued a tax  preparer  or  facilitator
registration  certificate.  If  an  individual acts as both a tax return
preparer and a facilitator, one registration certificate shall  indicate
both activities.
(B)  In  accordance  with instructions prescribed by the commissioner,
each tax return preparer and facilitator will also be assigned a  unique
identification  number  by the department, which must be used by the tax
return preparer and facilitator on each  return  which  the  tax  return
preparer  is  required  to  sign  and  each refund anticipation loan and
refund anticipation check the facilitator is required to sign.
(C) If a  tax  return  preparer  or  facilitator  is  an  employee  or
prospective  employee  of a tax return preparer, a commercial tax return
preparation  business,  or  a  facilitator,  the  tax  return  preparer,
commercial  tax  return  preparation business or facilitator must ensure
that the employee or prospective employee is  properly  registered  with
the  department  and  possesses  a  valid  tax  preparer  or facilitator
registration certificate. If an individual acts as  both  a  tax  return
preparer  and  a facilitator one registration certificate shall indicate
both activities.
(3)  Each  registered  tax  return  preparer  and   facilitator   must
electronically  re-register  with the department annually, in accordance
with instructions prescribed by the commissioner. If, at any time during
the year following registration or re-registration, as  applicable,  any
information  provided  by  the  tax  return preparer or facilitator upon
registration or re-registration is no longer  correct,  the  tax  return
preparer or facilitator must update his or her information in accordance
with instructions prescribed by the commissioner.
(4)  Each  tax  return  preparer  preparing  any  return must sign the
document and include  the  unique  identification  number  specified  in
paragraph  two  of  this  subdivision,  in  accordance with instructions
prescribed by the commissioner.
(c)(1) Each commercial tax return preparer must electronically pay  an
annual  fee of one hundred dollars to the department, in accordance with
instructions  prescribed  by  the  commissioner.   Registration   of   a
commercial  tax return preparer is not complete until payment of the fee
is made.
(2)  All  fees  received  by  the  commissioner   pursuant   to   this
subdivision,  reduced  by  those amounts the commissioner determines are
necessary to cover administrative costs to administer  the  registration

program  prescribed  by this section and the costs of any reimbursements
to  commercial  tax  return  preparers  that  may  be  required  due  to
duplicative  fee  payments  under  this  subdivision,  must be deposited
monthly to the credit of the general fund of the state. The commissioner
will maintain a system of accounts showing the amount of money collected
and disbursed from the fee imposed by this subdivision.
(d)  The  issuance  of  a  tax  preparer  or  facilitator registration
certificate to provide tax preparation services or  refund  anticipation
loan  services  is not, and must not be advertised as, an endorsement by
the department of the tax return preparer or the facilitator, or his  or
her qualifications or the services rendered by him or her.
(e)  A tax return preparer who has not registered with the department,
or a commercial tax return  preparer  who  has  not  paid  the  required
registration  fee,  will  not be allowed to represent his or her clients
before the division of taxation or the division  of  tax  appeals.  This
sanction  is  in addition to any penalties which may be imposed pursuant
to subdivision (f) of this section.
(f) (1) A tax return preparer or facilitator shall not: (A) charge  or
impose  any  fee,  charge  or  other  consideration  in  the  making  or
facilitating of a refund anticipation loan or refund anticipation  check
apart  from  the  fee  charged by the creditor or bank that provided the
loan or check;
(B)  Engage  in  unfair  or  deceptive  acts  or  practices   in   the
facilitating  of  a  refund  anticipation check or a refund anticipation
loan, including making any oral  statements  contradicting  any  of  the
information  required  to be disclosed under the Taxpayer Bill of Rights
as set forth in sections three hundred seventy-one through three hundred
seventy-three of the general business law;
(C) Directly or indirectly arrange for a third  party  to  charge  any
interest,  fee or charge related to a refund anticipation loan or refund
anticipation check;
(D) Include any of the following provisions in any documents  provided
or  signed  to  obtain a refund anticipation loan or refund anticipation
check, including the loan application or agreement: (i) a hold  harmless
clause;  (ii)  a  confession  of  judgment clause; (iii) a waiver of the
right to a jury trial; (iv) any assignment of or order  for  payment  of
wages  or other compensation for services; (v) a waiver of any provision
of the Taxpayer Bill of Rights, as set forth in sections  three  hundred
seventy-one  through three hundred seventy-three of the general business
law; or (vi) a waiver of the right  to  injunctive,  declaratory,  other
equitable  relief,  or  relief  on a classwide basis. Any aforementioned
waivers shall be deemed null, void and of no effect;
(E) Take or arrange for a creditor to take a security interest in  any
property  interest  of  the  taxpayer other than the proceeds of the tax
refund to secure payment of a refund anticipation loan;
(F)  Directly  or  indirectly,  individually  or  in  conjunction   or
cooperation  with  another  person,  engage  in  the  collection  of  an
outstanding or delinquent refund anticipation loan for any  creditor  or
assignee;
(G)  Make  a  misrepresentation  of fact in obtaining or attempting to
obtain a registration; or
(H) Engage in any other action prohibited by rules promulgated by  the
commissioner.
(2)  If  a  tax  return  preparer  violates  any one of the provisions
provided for in this subdivision, then the tax return preparer must  pay
a  penalty  of five hundred dollars for each such violation, in addition
to any other penalties provided for in this section.
(g) (1) The department shall issue a notice to a tax  return  preparer
or   facilitator  for  failure  to  register  or  re-register  with  the
department pursuant to paragraph one or three of subdivision (b) of this
section, which shall set forth a fifteen day period to cure the  failure
to  register or re-register. The commissioner is authorized to send such
notice electronically to the  tax  return  preparer's  or  facilitator's
online  services account. A tax return preparer or facilitator who fails
to register or re-register in accordance with such  notice  must  pay  a
penalty of two hundred fifty dollars. The penalty can be waived only for
good cause shown by the tax return preparer or facilitator.
(2)  The  department  shall  issue a notice to a commercial tax return
preparer who fails to pay the  fee  as  required  in  paragraph  one  of
subdivision  (c)  of  this section, for a calendar year, which shall set
forth a fifteen day period to cure the  failure  to  pay  the  fee.  The
commissioner  is  authorized  to  send such notice electronically to the
commercial tax return preparer's online services account.  A  commercial
tax  return  preparer  who  fails to pay the fee in accordance with such
notice must  pay  a  penalty  of  fifty  dollars  for  each  return  the
commercial  tax  return  preparer  has filed with the department in that
calendar year. The maximum  penalty  that  may  be  imposed  under  this
paragraph on any commercial tax return preparer during any calendar year
must  not  exceed  five thousand dollars. The penalty can be waived only
for good cause shown by the commercial tax return preparer.
(3) If a tax return preparer fails to sign his  or  her  name  to  any
return   that  requires  the  tax  return  preparer's  signature,  or  a
facilitator fails to sign his or her name  to  any  refund  anticipation
loan  or  refund anticipation check facilitation documentation, then the
tax return preparer or facilitator must pay a penalty in the  amount  of
two  hundred  fifty  dollars  for  each  failure  to  so sign. Provided,
however, that this penalty can be waived only for good  cause  shown  by
the tax return preparer or facilitator.
The  maximum  penalty  imposed  under this paragraph on any tax return
preparer with respect to returns filed during any calendar year  by  the
tax  return  preparer,  or on any facilitator with respect to any refund
anticipation   loan   or   refund   anticipation   check    facilitation
documentation completed during any calendar year by the facilitator must
not exceed ten thousand dollars. Provided, however, that if a tax return
preparer  or  facilitator  has been penalized under this paragraph for a
preceding calendar year and again fails to sign his or her name  on  any
return  that requires the tax return preparer's signature or again fails
to sign his or her name  on  any  refund  anticipation  loan  or  refund
anticipation   check  facilitation  documentation  during  a  subsequent
calendar year, then the penalty under this paragraph  for  each  failure
will be five hundred dollars, and no annual cap will apply.
(4)  If  a  tax  return preparer or a facilitator fails to include the
unique identification number assigned  by  the  department  pursuant  to
subparagraph  (B) of paragraph two of subdivision (b) of this section on
any return, or any return anticipation loan or return anticipation check
facilitation documentation that requires his or her signature, then  the
tax  return  preparer  or  facilitator must pay a penalty of one hundred
dollars for each failure to include his  or  her  unique  identification
number. Provided, however, that this penalty can be waived only for good
cause  shown  by  the  tax  return  preparer or facilitator. The maximum
penalty imposed under this paragraph  on  any  tax  return  preparer  or
facilitator  with respect to returns filed during any calendar year must
not exceed two thousand five hundred dollars; provided, however, that if
a tax return preparer or  facilitator  has  been  penalized  under  this
paragraph  for  a preceding calendar year and again fails to include the

unique identification number on one or more returns during a  subsequent
calendar  year,  then  the penalty under this paragraph for each failure
will be two hundred fifty dollars, and no annual cap will apply.
(5)  If  a tax return preparer, facilitator or a commercial tax return
preparation business employs an individual to prepare tax returns who is
not registered with the department and does  not  possess  a  valid  tax
preparer  or  facilitator  registration certificate, then the tax return
preparer, facilitator or commercial tax return preparation business,  as
applicable,  will  be  subject  to a penalty of five hundred dollars per
occurrence. This penalty can be waived only for good cause shown.
(6) The penalties provided for by this subdivision must be  paid  upon
notice  and  demand and will be assessed, collected and paid in the same
manner as taxes under article twenty-seven of this chapter.
(h) (1) Tax return preparers and  facilitators  must  prominently  and
conspicuously  display  a  copy of their registration certificate issued
pursuant to this section, for the current registration period, at  their
place  of  business  and  at  any  other location where they provide tax
return preparation  and/or  facilitation  services,  in  an  area  where
taxpayers  using  their  services  are  able  to  see  and  review  such
registration certificate.
(2)  Tax  return  preparers  and  facilitators  must  prominently  and
conspicuously  display  at  their  place  of  business  and at any other
location where they provide tax return preparation  and/or  facilitation
services the following documents:
(A)  a  current  price  list,  in  at  least fourteen-point type, that
includes, but is not limited to, a list of all services offered  by  the
tax return preparer and/or facilitator; the minimum fee charged for each
service,  including the fee charged for each type of federal or New York
state tax return to be prepared and facilitation service to be provided;
and a list of each factor  that  may  increase  a  stated  fee  and  the
specific  additional fees or range of possible additional fees when each
factor applies; and
(B) a copy of the most recent Consumer Bill of  Rights  Regarding  Tax
Preparers  published by the department pursuant to section three hundred
seventy-two of the general business law.
(3) A tax return preparer or facilitator who fails to comply with  any
of  the  requirements  of  this  subdivision  must pay a penalty of five
hundred dollars for the first month of non-compliance and  five  hundred
dollars  for  each  subsequent  month  of non-compliance thereafter. The
maximum penalty that may be imposed under this subdivision  on  any  tax
return  preparer or facilitator during any calendar year must not exceed
ten thousand dollars. The penalty can be  waived  only  for  good  cause
shown by the tax return preparer or facilitator.
(i)  The  provisions  of  this  section  will apply exclusively to the
registration  of  tax  return  preparers  and  facilitators   with   the
department,  payment  of  the registration fee if required by commercial
tax return preparers, the signing of  returns  and  use  of  the  unique
identification  numbers  assigned  by  the department upon registration.
Other  provisions  of  this  chapter  or  any  other  provision  of  law
prescribing  additional  requirements applicable to tax return preparers
or facilitators will not be affected by the provisions of  this  section
except  as set forth expressly herein, and will remain in full force and
effect.