TITLE OF BILL:
to amend the tax law, in relation to removing the prohibition on tax
return preparers or facilitators operating in the same premises as
licensed check cashers and to repeal subparagraph (G) of paragraph 1 of
subsection (f) of section 32 of such law relating thereto
To remove the prohibition against tax return preparers or
facilitators operating on the same premises as licensed check
cashers, contained in Section 32 of the New York Tax Law.
SUMMARY OF PROVISIONS:
Section 32 (f)(1)(G) is amended to delete the
prohibition against tax return preparers or facilitators operating
on the same premises as licensed check cashers.
This bill corrects an overbroad and unjustified
provision within the New York Tax law, which prohibits tax return
preparers and facilitators from operating within the same premises as
licensed New York check cashers.
Currently, the Tax Law prohibits registered tax return preparers and
facilitators from referring, facilitating, soliciting consumers or
conducting business on behalf of, or in conjunction with, or on the
same premises as a third party engaged in check chasing for a fee.
This provision became part of the Tax Law in 2009 as part of the
Executive Budget, Chapter 59 of the Laws of 2009, at a time when the
Department of Taxation and Finance was seeking to regulate tax return
preparers, refund anticipation loans ("RALs") and refund anticipation
check ("RACs"). However, the law had the unintended consequence of
restricting legitimate tax return preparation businesses who
established temporary tax preparation facilities in the premises of
licensed check cashers.
Check cashers are licensed and regulated by the NYS Department of
Financial Services. Prohibiting tax return preparers and facilitators
from locating in licensed check cashers in no way furthered the
purposes of regulating the tax preparation business and had the
unintended consequence of prohibiting the locating of tax preparers
in facilities, i.e., licensed check cashers, where millions of
low-and-moderate-income New Yorkers conduct their financial
transactions in a regulated environment.
Furthermore, the measure was contrary to the intention of the NYS
Legislature in enacting the Preamble to L.1994, c.546, January 12,
1993 (NYS Banking Law,
Article 9-A, Section 369), provides that: "check cashers provide
important and vital services to New York citizens; that the business
of check cashers shall be supervised and regulated through the
banking department in such a manner as to maintain consumer
confidence in such business and protect the public interest; that the
licensing of check cashers shall be determined in accordance with the
needs of the communities they serve; and that it is in the public
interest to promote the stability of the check cashing business for
the purpose of meeting the needs of the community that are served by
Therefore, the Legislature determines that the prohibition against tax
preparers and facilitators locating in the premises of licensed check
cashers does not further the intention of New York Tax Law, is
contrary to the intent and purpose of the New York Banking Law, and
has the unintended consequences of restricting legitimate, licensed
business activity that provides regulated financial services to
millions of New Yorkers and, therefore, Section 32 (f)(1)(G) of the
Tax Law should be amended.