N.Y.
Tax Law Section 1700
Voluntary disclosure and compliance program
1.
Notwithstanding the provisions of any other law to the contrary, there is hereby established a voluntary disclosure and compliance program, as described in this section, to be administered by the commissioner, for all eligible taxpayers as described in this section, owing any tax imposed or previously imposed under this chapter or administered by the commissioner.2.
For purposes of the voluntary disclosure and compliance program established under this section, an eligible taxpayer is an individual, partnership, estate, trust, corporation, limited liability company, joint stock company, or any other company, trustee, receiver, assignee, referee, society, association, business or any other person subject to a tax imposed by or pursuant to the authority of this chapter or any other law imposing administrative tax responsibilities on the commissioner and who meets the following criteria:(1)
the taxpayer is not currently under audit by the department;(2)
the taxpayer is one who is voluntarily disclosing a New York tax liability that the department has not determined, calculated, researched or identified at the time of the disclosure;(3)
the taxpayer is not currently a party to any criminal investigation being conducted by an agency of the state or any political subdivision thereof; and(4)
the taxpayer is not seeking to disclose participation in a tax avoidance transaction that is a federal or New York state reportable or listed transaction.3.
Under the voluntary disclosure and compliance program, upon execution of a voluntary disclosure and compliance agreement by the eligible taxpayer and the commissioner, the commissioner shall waive any applicable penalties (including the additional rate of interest prescribed under § 1145 (Penalties and interest)section eleven hundred forty-five of this chapter) for the following:(1)
failure to pay any such tax liability;(2)
failure to file a return or report with respect to any such tax liability; and(3)
failure to pay estimated tax. In addition, no criminal action or proceeding shall be brought against an eligible taxpayer relating to the tax liability covered by the agreement. This agreement shall not preclude the auditing of the returns filed to determine if those returns were completed in accordance with existing law and regulation. Intentional failure to pay all the taxes, plus related interest, pursuant to the voluntary disclosure and compliance agreement entered into between the taxpayer and the commissioner, shall invalidate any waiver of penalty, invalidate the forbearance of any administrative or criminal action or proceeding.4.
To participate in the voluntary disclosure and compliance program, an eligible taxpayer must apply by submitting a disclosure statement in the form and manner prescribed by the commissioner. The disclosure statement shall contain all the information the commissioner reasonably deems necessary to effectively administer the program. As long as all the requirements of the voluntary disclosure and compliance program are met, no application shall be denied solely because the taxpayer has admitted that the delinquency was the result of willful or fraudulent conduct. Except in instances where the taxpayer has failed to comply with the terms of a voluntary disclosure and compliance agreement, the commissioner shall not use the taxpayer’s disclosure as evidence in any proceeding brought against the taxpayer or reveal the contents of the disclosure to any law enforcement or other agency. However, the disclosure of any returns or reports filed under this program with the secretary of the treasury of the United States, his or her delegates, or the proper tax officer of any state or city is permitted as otherwise provided for in this chapter.5.
(a) If the taxpayer and the tax liability are eligible under the voluntary disclosure and compliance program, the commissioner is authorized to enter into a voluntary disclosure and compliance agreement with the taxpayer. A voluntary disclosure and compliance agreement will be in a form to be established by the commissioner and include such terms as the commissioner may reasonably require to satisfy the taxpayer’s disclosed tax obligations and enable and require the taxpayer to comply with the tax law in the future. The taxpayer must pay the tax and the related interest that are the subject of the voluntary disclosure and compliance agreement when the agreement is executed or within the time stated on a bill issued to the taxpayer by the commissioner. In the event the commissioner is satisfied that the taxpayer cannot make immediate full payment of the disclosed tax liability, the commissioner may enter into an installment payment program with the taxpayer for the payment of the tax and interest due. The commissioner may require a financial disclosure statement setting forth information concerning the taxpayer’s current assets, liabilities, earnings, and other financial information before entering into an installment payment plan with the taxpayer. In addition to any other information and terms that the commissioner determines are appropriate, the voluntary disclosure and compliance agreement shall provide that, if the taxpayer complies with the terms of the compliance agreement, the taxpayer will not be subject to any criminal tax prosecution in New York state for the conduct disclosed by the taxpayer.(b)
If the taxpayer intentionally provides false material information or omits material information in his or her submissions to the commissioner, or attempts to intentionally defeat or evade a tax due pursuant to the agreement executed under this article, or intentionally fails to comply with the terms of the compliance agreement, such agreement shall be deemed rescinded.6.
Unless the commissioner on his or her own motion redetermines the amount of tax due, including applicable interest, no refund shall be granted or credit allowed with respect to any taxes, including applicable interest, paid under this program.7.
The commissioner may promulgate regulations, issue forms and instructions, and take any and all other actions necessary to implement the provisions of the program established under this section. The commissioner shall publicize the program provided for in this section so as to maximize public awareness of and participation in such program.8.
For purposes of this section, the term “taxpayer” includes any person required to collect any of the taxes specified in subdivision one of this section.9.
The voluntary disclosure and compliance application, the disclosure statement, the voluntary disclosure and compliance agreement, and other documents filed by an eligible taxpayer pursuant to the program established by this section are deemed to be reports and returns:(a)
subject to the secrecy provisions of this chapter in the same manner and to the same extent as if such documents were referred to in any of the secrecy provisions of this chapter; and(b)
for purposes of the criminal provisions of article 37 (Crimes and Other Offenses, Seizures and Forfeitures)article thirty-seven of this chapter.
Source:
Section 1700 — Voluntary disclosure and compliance program, https://www.nysenate.gov/legislation/laws/TAX/1700 (updated Sep. 22, 2014; accessed Oct. 26, 2024).
