STATE OF NEW YORK
________________________________________________________________________
4722--A
2017-2018 Regular Sessions
IN SENATE
February 24, 2017
___________
Introduced by Sen. LATIMER -- read twice and ordered printed, and when
printed to be committed to the Committee on Investigations and Govern-
ment Operations -- committee discharged, bill amended, ordered
reprinted as amended and recommitted to said committee
AN ACT to amend the tax law, in relation to decreasing interest due on
underpayment of tax or erroneous refunds relating to personal income
tax and sales and compensating use taxes
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. Subsections (a) and (j) of section 684 of the tax law, as
2 amended by section 2 of subpart D of part V-1 of chapter 57 of the laws
3 of 2009, are amended to read as follows:
4 (a) General.--If any amount of income tax is not paid on or before the
5 last date prescribed in this article for payment, interest on such
6 amount at the underpayment rate set [by the commissioner pursuant to
7 section six hundred ninety-seven of this part, or if no rate is set,] at
8 the rate of [seven and one-half] three percent per annum shall be paid
9 for the period from such last date to the date paid, whether or not any
10 extension of time for payment was granted. Interest under this
11 subsection shall not be paid if the amount thereof is less than one
12 [dollar] hundred dollars. If the time for filing of a return of tax
13 withheld by an employer is extended, the employer shall pay interest for
14 the period for which the extension is granted and may not charge such
15 interest to the employee.
16 (j) Interest on erroneous refund.--Any portion of tax or other amount
17 which has been erroneously refunded, and which is recoverable by the
18 commissioner, shall bear interest at the underpayment rate set [by the
19 commissioner pursuant to section six hundred ninety-seven of this part,
20 or if no rate is set,] at the rate of [seven and one-half] three percent
21 per annum from the date of the payment of the refund, but only if it
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD10172-05-7
S. 4722--A 2
1 appears that any part of the refund was induced by fraud or a misrepre-
2 sentation of a material fact.
3 § 2. Subparagraphs (i), (ii) and (vi) of paragraph 1 of subdivision
4 (a) of section 1145 of the tax law, subparagraph (i) as amended by chap-
5 ter 411 of the laws of 1986, subparagraph (ii) as amended by section 12
6 of subpart D of part V-1 of chapter 57 of the laws of 2009 and subpara-
7 graph (vi) as amended by chapter 65 of the laws of 1985, are amended to
8 read as follows:
9 (i) Any person failing to file a return or to pay or pay over any tax
10 to the tax commission within the time required by or pursuant to this
11 article (determined with regard to any extension of time for filing or
12 paying) shall be subject to a penalty of [ten] five percent of the
13 amount of tax due if such failure is for not more than one month, with
14 an additional [one] one-half percent for each additional month or frac-
15 tion thereof during which such failure continues, not exceeding thirty
16 percent in the aggregate. Provided, however, in the case of a failure to
17 file such return within sixty days of the date prescribed for filing of
18 such return by or pursuant to this article (determined with regard to
19 any extension of time for filing), the penalty imposed by this subpara-
20 graph shall not be less than the lesser of one hundred dollars or one
21 hundred percent of the amount required to be shown as tax on such
22 return. For the purpose of the preceding sentence, the amount of tax
23 required to be shown on the return shall be reduced by the amount of any
24 part of the tax which is paid on or before the date prescribed for
25 payment of the tax and by the amount of any credit against the tax which
26 may be claimed upon the return. In the case of a failure to file a
27 return by a person required to register with the tax commission as
28 provided in section eleven hundred thirty-four, in no event shall the
29 penalty for failure to file a return be less than fifty dollars.
30 (ii) If any amount of tax is not paid on or before the last date
31 prescribed in this article for payment, interest on such amount at the
32 rate of [fourteen and one-half] seven and one-quarter percent per annum
33 or at the underpayment rate set by the commissioner pursuant to section
34 eleven hundred forty-two of this part, whichever is greater, shall be
35 paid for the period from such last date to the date paid, whether or not
36 any extension of time for payment was granted. Interest under this
37 subparagraph shall not be paid if the amount thereof is less than one
38 dollar.
39 (vi) Any person required by this article to file a return, who omits
40 from the total amount of state and local sales and compensating use
41 taxes required to be shown on a return an amount which is in excess of
42 twenty-five percent of the amount of such taxes required to be shown on
43 the return shall be subject to a penalty equal to [ten] five percent of
44 the amount of such omission. The amount of the omission under the
45 preceding sentence shall be reduced by that portion of the omission
46 which is attributable to the tax treatment of any item by such person if
47 there is or was substantial authority for such treatment, or any item
48 with respect to which the relevant facts affecting the item's tax treat-
49 ment are adequately disclosed in the return or in a statement attached
50 to the return. If the tax commission determines that such omission was
51 due to reasonable cause and not due to willful neglect, it shall remit
52 all of such penalty. The penalty provided for in this subparagraph shall
53 not apply to any return of estimated tax required to be filed under
54 section eleven hundred thirty-seven-A.
55 § 3. This act shall take effect immediately and shall apply to all tax
56 years commencing on and after January 1, 2018.