2023 New York Laws › TAX - Tax › Article 22 - Personal Income Tax › Part 6 - Procedure and Administration › 687 - Limitations on Credit or Refund.

§  687.  Limitations  on  credit or refund.-- (a) General.-- Claim for
credit or refund of an overpayment of income tax shall be filed  by  the
taxpayer within (i) three years from the time the return was filed, (ii)
two  years  from  the time the tax was paid, or (iii) in the case of any
overpayment arising from  an  erroneous  denial  by  the  department  of
environmental  conservation of a certification of completion pursuant to
section 27-1419 of the environmental conservation law,  two  years  from
the  time  a  final  determination  to  the  effect that such denial was
erroneous is made and is no longer subject to judicial review, whichever
of such periods expires the latest, or if no return  was  filed,  within
two  years  from the time the tax was paid. If the claim is filed within
the three year period, the amount of the  credit  or  refund  shall  not
exceed  the  portion  of the tax paid within the three years immediately
preceding the filing of the claim plus the period of  any  extension  of
time  for  filing  the  return  unless  such  claim is for a credit or a
portion thereof provided pursuant to paragraph two or four of subsection
(c), paragraph two or four  of  subsection  (d)  or  subsection  (e)  of
section  six  hundred  six  of  this  chapter. If the claim is not filed
within the three year period, but is filed within the two  year  period,
the  amount  of the credit or refund shall not exceed the portion of the
tax paid during the two years immediately preceding the  filing  of  the
claim  unless  such  claim is for a credit or a portion thereof provided
pursuant to paragraph two or four of subsection (c),  paragraph  two  or
four  of  subsection (d) or subsection (e) of section six hundred six of
this chapter. In the case of a claim for credit or refund  filed  within
the  period prescribed in paragraph (iii) of this subsection, the amount
of the credit or refund may exceed the portion of the  tax  paid  within
the  applicable  period  specified  in  the  two  immediately  preceding
sentences, but only to the extent  of  the  amount  of  the  overpayment
attributable  to  the  denial  described  in  such  paragraph. Except as
otherwise provided in this section, if no claim is filed, the amount  of
a  credit or refund shall not exceed the amount which would be allowable
if a claim had been filed on the date the credit or refund is allowed.
(b) Extension  of  time  by  agreement.--If  an  agreement  under  the
provisions  of  paragraph  (2)  of subsection (c) of section six hundred
eighty-three (extending the period for assessment of income tax) is made
within the period prescribed in subsection (a) for the filing of a claim
for credit or refund, the period  for  filing  a  claim  for  credit  or
refund,  or  for making credit or refund if no claim is filed, shall not
expire prior to six months after the expiration  of  the  period  within
which  an  assessment  may  be  made  pursuant  to  the agreement or any
extension thereof. The amount of such credit or refund shall not  exceed
the  portion  of  the  tax paid after the execution of the agreement and
before the filing of the claim or the making of the credit or refund, as
the case may be, plus the portion of the  tax  paid  within  the  period
which would be applicable under subsection (a) if a claim had been filed
on the date the agreement was executed.
(c)  Notice  of  federal change or correction.-- A claim for credit or
refund of any overpayment of tax attributable to  a  federal  change  or
correction  required  to  be  reported  pursuant  to section six hundred
fifty-nine shall be filed by the taxpayer within two years from the time
the notice of such change or  correction  or  such  amended  return  was
required  to  be filed with the commissioner of taxation and finance. If
the report or amended return required by section six hundred  fifty-nine
is not filed within the ninety day period therein specified, no interest
shall  be  payable  on any claim for credit or refund of the overpayment
attributable to the federal change or correction.  The  amount  of  such
credit  or  refund  shall  not exceed the amount of the reduction in tax

attributable to such federal change, correction or items amended on  the
taxpayer's  amended federal income tax return. This subsection shall not
affect the time within which or the amount for which a claim for  credit
or refund may be filed apart from this subsection.
(d) Overpayment attributable to net operating loss carryback.--A claim
for  credit or refund of so much of an overpayment as is attributable to
the application to the taxpayer of a net operating loss carryback  shall
be  filed within three years from the time the return was due (including
extensions thereof) for the taxable year of  the  loss,  or  within  the
period  prescribed in subsection (b) in respect of such taxable year, or
within the period prescribed in subsection  (c),  where  applicable,  in
respect  of  the taxable year to which the net operating loss is carried
back, whichever expires the latest.
(e) Failure to file claim  within  prescribed  period.--No  credit  or
refund shall be allowed or made, except as provided in subsection (f) of
this  section or subsection (d) of section six hundred ninety, after the
expiration of the applicable period  of  limitation  specified  in  this
article,  unless  a  claim for credit or refund is filed by the taxpayer
within such period. Any later credit shall be void and any later  refund
erroneous.  No  period  of  limitations specified in any other law shall
apply to the recovery by a taxpayer of moneys paid in respect  of  taxes
under this article.
(f)  Effect  of petition to tax commission.--If a notice of deficiency
for a taxable year has been mailed to the  taxpayer  under  section  six
hundred  eighty-one and if the taxpayer files a timely petition with the
tax commission under section six hundred eighty-nine, it  may  determine
that  the taxpayer has made an overpayment for such year (whether or not
it also determines a deficiency for such year). No  separate  claim  for
credit  or  refund for such year shall be filed, and no credit or refund
for such year shall be allowed or made, except--
(1) as to overpayments determined by a decision of the tax  commission
which has become final; and
(2)  as  to  any  amount  collected in excess of an amount computed in
accordance with the decision of the  tax  commission  which  has  become
final; and
(3) as to any amount collected after the period of limitation upon the
making of levy for collection has expired; and
(4)  as  to  any  amount claimed as a result of a change or correction
described in subsection (c).
(g) Limit on amount of credit or refund.--The  amount  of  overpayment
determined  under  subsection  (f)  shall,  when the decision of the tax
commission has become final, be credited or refunded in accordance  with
subsection  (a)  of  section six hundred eighty-six and shall not exceed
the amount of tax which the tax commission determines  as  part  of  its
decision was paid--
(1) after the mailing of the notice of deficiency, or
(2) within the period which would be applicable under subsections (a),
(b)  or (c), if on the date of the mailing of the notice of deficiency a
claim had been filed (whether or not filed)  stating  the  grounds  upon
which the tax commission finds that there is an overpayment.
(h)  Early  return.--For  purposes  of  this section, any return filed
before  the  last  day  prescribed  for  the  filing  thereof  shall  be
considered  as  filed on such last day, determined without regard to any
extension of time granted the taxpayer.
(i) Prepaid income tax.--For purposes of this section, any tax paid by
the taxpayer before the last day prescribed for its payment, any  income
tax  withheld from the taxpayer during any calendar year, and any amount
paid by the taxpayer as estimated income tax for a taxable year shall be

deemed to have been paid by him on the fifteenth day of the fourth month
following the close of his taxable  year  with  respect  to  which  such
amount constitutes a credit or payment.
(j) Return and payment of withholding tax.--Notwithstanding subsection
(h), for purposes of this section with respect to any withholding tax--
(1)  if  a return for any period ending with or within a calendar year
is filed before April fifteenth of the succeeding  calendar  year,  such
return  shall  be considered filed on April fifteenth of such succeeding
calendar year; and
(2) if a tax with respect  to  remuneration  paid  during  any  period
ending  with or within a calendar year is paid before April fifteenth of
the succeeding calendar year, such tax shall be considered paid on April
fifteenth of such succeeding calendar year.
(k) Running of periods  of  limitation  suspended  while  taxpayer  is
unable to manage financial affairs due to disability. -- (1) In the case
of  an  individual  taxpayer,  the  running  of the periods specified in
subsections (a), (b), and (c) of this section shall be suspended  during
any period of such individual's life that such individual is financially
disabled.  For purposes of this subsection, an individual taxpayer is an
individual  who  is subject to any state or local personal income tax or
surcharge administered by the commissioner.
(2) For purposes of paragraph one of this  subsection,  an  individual
taxpayer  is financially disabled if such individual is unable to manage
his or her financial affairs  by  reason  of  a  medically  determinable
physical  or  mental impairment of that individual which can be expected
to result in death or which has lasted or can be expected to last for  a
continuous  period  of  not less than twelve months. An individual shall
not be considered to  have  such  an  impairment  unless  proof  of  the
existence   thereof  is  furnished  in  such  form  and  manner  as  the
commissioner may require.
(3) An  individual  taxpayer  shall  not  be  treated  as  financially
disabled  during  any  period that such individual's spouse or any other
person is authorized to act on behalf of such  individual  in  financial
matters.
(l)  Cross  reference.--  For  provision barring refund of overpayment
credited against tax of a succeeding year, except for good cause  shown,
see subsection (e) of section six hundred eighty-six.