2023 New York Laws › TAX - Tax › Article 28 - Sales and Compensating Use Taxes › Part 4 - Administrative Provisions › 1133 - Liability for the Tax.

§ 1133. Liability for the tax. (a) (1) Except as otherwise provided in
paragraph  two  of  this  subdivision  and  in  section  eleven  hundred
thirty-seven of this part, every person  required  to  collect  any  tax
imposed  by this article shall be personally liable for the tax imposed,
collected or required to be  collected  under  this  article.  Any  such
person  shall  have the same right in respect to collecting the tax from
his customer or in respect to nonpayment of the tax by the  customer  as
if the tax were a part of the purchase price of the property or service,
amusement  charge  or  rent, as the case may be, and payable at the same
time; provided, however, that the tax commission shall be  joined  as  a
party in any action or proceeding brought to collect the tax.
(2)  Notwithstanding  any  other  provision  of  this article: (i) The
commissioner shall grant the relief described in subparagraph  (iii)  of
this  paragraph to a limited partner of a limited partnership (but not a
partner of a limited liability partnership) or a  member  of  a  limited
liability  company if such limited partner or member demonstrates to the
satisfaction of the commissioner that such limited partner's or member's
ownership interest and the percentage of the distributive share  of  the
profits  and  losses  of  such  limited partnership or limited liability
company are each less than fifty percent, and such  limited  partner  or
member  was  not  under  a  duty  to act for such limited partnership or
limited liability company in complying  with  any  requirement  of  this
article. Provided, however, the commissioner may deny an application for
relief  to any such limited partner or member who the commissioner finds
has acted on behalf of such limited  partnership  or  limited  liability
company  in  complying  with any requirement of this article or has been
convicted of a crime provided in this chapter  or  who  has  a  past-due
liability,  as such term is defined in section one hundred seventy-one-v
of this chapter.
(ii) Such limited partner or member must  submit  an  application  for
relief,  on  a  form prescribed by the commissioner, and the information
provided in such application must be true and complete in  all  material
respects.  Providing  materially false or fraudulent information on such
application shall disqualify such limited  partner  or  member  for  the
relief described in subparagraph (iii) of this paragraph, shall void any
agreement  with  the commissioner with respect to such relief, and shall
result in such limited partner or member bearing  strict  liability  for
the  total  amount of tax, interest and penalty owed by their respective
limited partnership  or  limited  liability  company  pursuant  to  this
subdivision.
(iii)  A  limited  partner  of  a  limited  partnership or member of a
limited liability company, who meets the requirements set forth in  this
paragraph   and   whose  application  for  relief  is  approved  by  the
commissioner, shall be liable for the percentage of the  original  sales
and use tax liability of their respective limited partnership or limited
liability  company  that  reflects  such  limited  partner's or member's
ownership interest of distributive share of the profits  and  losses  of
such  limited  partnership  or  limited  liability company, whichever is
higher. Such original  liability  shall  include  any  interest  accrued
thereon  up to and including the date of payment by such limited partner
or member at the underpayment rate set by the commissioner  pursuant  to
section  eleven  hundred forty-two of this part, and shall be reduced by
the sum of any payments made by (A) the limited partnership  or  limited
liability  company;  (B) any person required to collect tax not eligible
for relief; and (C) any person required to collect tax who was  eligible
for  relief  but had not been approved for relief by the commissioner at
the time such payment was made. Provided, however, such limited  partner
or  member  shall  not  be  liable  for any penalty owed by such limited

partnership or limited liability company or any other partner or  member
of  such  limited  partnership or limited liability company. Any payment
made by a limited partner or member pursuant to the provisions  of  this
paragraph  shall  not be credited against the liability of other limited
partners or members of their respective limited partnership  or  limited
liability  company  who  are  eligible  for  the  same relief; provided,
however that the sum of the amounts owed by all of the persons  required
to  collect  tax  of  a limited partnership or limited liability company
shall not exceed the total liability  of  such  limited  partnership  or
limited liability company.
(b) Where any customer has failed to pay a tax imposed by this article
to  the  person  required  to  collect the same, then in addition to all
other rights, obligations and  remedies  provided,  such  tax  shall  be
payable  by  the customer directly to the tax commission and it shall be
the duty of the customer to file a return with the tax commission and to
pay the tax to it within twenty days of the date the tax was required to
be paid.
(c) The tax commission may, whenever it deems  it  necessary  for  the
proper enforcement of this article, provide by regulation that customers
shall file returns and pay directly to the tax commission any tax herein
imposed,  at  such times as returns are required to be filed and payment
made by persons required to collect the tax.
(d) (1) no person required to collect any tax imposed by this  article
shall  advertise  or  hold  out to the public in any manner, directly or
indirectly, that the tax imposed by this article is not considered as an
element in the price, amusement charge or  rent  payable  by  customers.
However, such person required to collect tax may advertise, hold out, or
state  to a retail purchaser or to the public, that such person will pay
the tax imposed by section eleven hundred five of this article on behalf
of a retail purchaser, subject to the following conditions:
(i) In so advertising, holding out, or stating to a  retail  purchaser
or  to  the  public, such person required to collect tax shall expressly
state on every bill, memorandum,  receipt  or  other  statement  of  the
price, amusement charge or rent paid or payable given to such purchaser,
that such person will pay the tax imposed by section eleven hundred five
of  this  article on behalf of such purchaser, and such person shall not
indicate or imply that the transaction is exempt or  excluded  from  any
tax imposed by this article; and
(ii)  Every bill, memorandum, receipt or other statement of the price,
amusement charge or rent paid or payable given to such  purchaser  shall
separately  state  the amount of tax due pursuant to such section eleven
hundred five and that the tax was not  collected  from  such  purchaser.
Such  person  required to collect tax shall hold such tax as trustee for
and on account of the state; and
(iii) A retail purchaser, who in good  faith  accepts  from  a  person
required to collect any tax imposed by this article, a bill, memorandum,
receipt  or  other statement of the price, amusement charge or rent that
indicates the amount of tax due pursuant to such section eleven  hundred
five  and  that  such person required to collect tax will be paying such
tax on behalf of such purchaser, shall not be liable for the tax imposed
by such section eleven  hundred  five,  or  any  interest  or  penalties
thereon; provided, however that nothing in this subdivision shall exempt
such  purchaser  from  any additional tax due pursuant to section eleven
hundred ten of this article.
(e) Applicability  of  Mobile  Telecommunications  Sourcing  Act.  The
provisions of sections 119(c), 120, 121 and 122 of title 4 of the United
States  Code  as  enacted  and  in  effect  on  July  twenty-eighth, two
thousand,  to  the  extent  relevant  and  to  the  extent  required  by

preemption,  shall  apply  to the provisions of this article in the same
manner and with the same force and effect as if  the  language  of  such
sections of such title 4 of the United States Code had been incorporated
in  full into this article and had expressly referred to the taxes under
this article, with such modifications as may be necessary  in  order  to
adapt  the  language  of  such  provisions  to the taxes imposed by this
article.
(f) A marketplace provider is relieved of liability under this section
for failure to collect the correct amount of tax to the extent that  the
marketplace  provider  can  show  that the error was due to incorrect or
insufficient information  given  to  the  marketplace  provider  by  the
marketplace  seller. Provided, however, this subdivision shall not apply
if the marketplace seller and marketplace provider are affiliated within
the meaning of paragraph  one  of  subdivision  (e)  of  section  eleven
hundred one of this article.