senate Bill S4307

Signed By Governor
2013-2014 Legislative Session

Suspends the income tax refund statute of limitations for individuals who are financially disabled

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Archive: Last Bill Status Via A5959 - Signed by Governor


  • Introduced
  • In Committee
  • On Floor Calendar
    • Passed Senate
    • Passed Assembly
  • Delivered to Governor
  • Signed by Governor

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Actions

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Assembly Actions - Lowercase
Senate Actions - UPPERCASE
Aug 05, 2014 signed chap.204
Aug 01, 2014 delivered to governor
Jun 19, 2014 returned to assembly
passed senate
3rd reading cal.1071
substituted for s4307
Jun 19, 2014 substituted by a5959
Jun 09, 2014 advanced to third reading
Jun 03, 2014 2nd report cal.
Jun 02, 2014 1st report cal.1071
May 13, 2014 reported and committed to finance
Jan 08, 2014 referred to investigations and government operations
Mar 20, 2013 referred to investigations and government operations

Votes

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Jun 2, 2014 - Finance committee Vote

S4307
36
0
committee
36
Aye
0
Nay
1
Aye with Reservations
0
Absent
0
Excused
0
Abstained
show Finance committee vote details

May 13, 2014 - Investigations and Government Operations committee Vote

S4307
9
0
committee
9
Aye
0
Nay
0
Aye with Reservations
0
Absent
0
Excused
0
Abstained
show Investigations and Government Operations committee vote details

Investigations and Government Operations Committee Vote: May 13, 2014

Co-Sponsors

S4307 - Bill Details

See Assembly Version of this Bill:
A5959
Law Section:
Tax Law
Laws Affected:
Amd §687, Tax L; amd §11-1787, NYC Ad Cd

S4307 - Bill Texts

view summary

Suspends the income tax refund statute of limitations for individuals who are financially disabled.

view sponsor memo
BILL NUMBER:S4307

TITLE OF BILL: An act to amend the tax law and the administrative
code of the city of New York, in relation to suspending the income tax
refund statute of limitations for individuals due to financial
disability

Purpose of Bill:

The bill would suspend (toll) the statute of limitations for an
"individual taxpayer" who to file a claim for an income tax credit or
refund during a period when an individual is unable to manage his or
her financial affairs due to a severe physical or mental impairment
("financial disability").

Summary of provisions:

Section 1 of the bill would re-letter current subsection (k) of
section 687 of the Tax Law to be subsection (l) and add a new
subsection (k).

Proposed paragraph (1) of new subsection (k) would suspend the statute
of limitations for an "individual taxpayer" to file a claim for a
state or local income tax credit or refund during any period when that
individual is "financially disabled?." An individual taxpayer is an
individual who is subject to any State or local personal income tax or
surcharge administered by the Commissioner of Taxation and Finance.

Proposed paragraph (2) of new subsection (k) provides that an
individual taxpayer would be considered "financially disabled" if he
or she is unable to manage his or her financial affairs by reason of a
medically determinable physical or mental impairment 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. Proof of
the existence of such impairment would be provided in the form and
manner required by the Commissioner of Taxation and Finance.

Proposed paragraph (3) of new subsection (k) provides that an
individual taxpayer would not be treated as financially disabled
during any period that the individual's spouse or any other person is
authorized to act on behalf of such individual in financial matters.

Section 2 of the bill provides that a similar new subdivision (k)
would be added to section 11-1787 of the Administrative Code of the
City of New York for purposes of the New York City personal income tax
on residents.

Section 3 of the bill provides that it would take effect immediately,
and apply to periods of financial disability commencing before, on, or
after the date of enactment, but would not apply to any claim for
credit or refund that without regard to this bill, would be barred by
the operation of any law or rule of law (including res judicata) as of
the date of enactment. Therefore, these provisions would not be
applicable to claims for which the statute of limitations to file a
claim for a credit or refund has expired, or where there has been a
final decision on the merits of the claim as of the date of enactment.


Existing law:

This bill would amend the Tax Law and the Administrative Code of the
City of New York to include provision's similar to section 6511(h) of
the Internal Revenue Code. This would allow the statutory time period
to file a claim for a credit or refund of state and local income taxes
to be suspended (tolled) during a period when an individual taxpayer
is "financially disabled" which is not currently permitted in New
York.

Prior Legislative history:

This is a new proposal.

Statement in support:

In the United States Supreme Court case of US v Brockamp, 518 U.S. 347
(1997), the taxpayers were disabled by senility or alcoholism and
failed to file timely federal refund claims. The Supreme Court
rejected the argument that the refund statute of limitations in the
Internal Revenue Code could be tolled for equitable reasons. The
Internal Revenue Code was subsequently amended by adding a subsection
(h) to section 6511 to allow for tolling of time for individual
taxpayers to file a claim for credit or refund when they are unable to
take care of their financial affairs because of a severe mental or
physical impairment.

Because the New York personal income tax refund statute of limitations
provisions in section 687 of the Tax Law (and the similar provisions
in section 11-1787 of the Administrative Code of the City of New York)
were not similarly amended to include the equitable tolling provisions
of section 6511(h) of the Internal Revenue Code, the holding in the
Brockamp case is still good law in New York. The New York refund
statute of limitations provisions are among various income tax
procedural provisions derived from comparable federal provisions in
order to "avoid injustices resulting from differing Federal and State
remedies where the substantive law is similar or identical."
(Memorandum of State Department of Taxation and Finance for Chapter
1011 of the Laws of 1962.) Therefore, the New York refund statute of
limitations provisions should be amended to include equitable tolling
provisions similar to the federal provisions since it would be
equitable for New York personal income taxpayers to be able to take
advantage of the same equitable tolling provisions available to them
on the federal level.

Budget implications:

It is estimated that this bill will result in a decrease of $750,000
in revenue for SFY 2013-14.

Local Impact:

None.

Effective Date:

The bill would take effect immediately.


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                    S T A T E   O F   N E W   Y O R K
________________________________________________________________________

                                  4307

                       2013-2014 Regular Sessions

                            I N  S E N A T E

                             March 20, 2013
                               ___________

Introduced  by Sen. MARCELLINO -- (at request of the Department of Taxa-
  tion and Finance) -- read twice and ordered printed, and when  printed
  to  be  committed  to  the  Committee on Investigations and Government
  Operations

AN ACT to amend the tax law and the administrative code of the  city  of
  New  York,  in relation to suspending the income tax refund statute of
  limitations for individuals due to financial disability

  THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
BLY, DO ENACT AS FOLLOWS:

  Section  1. Subsection (k) of section 687 of the tax law is relettered
subsection (l) and a new subsection (k) is added to read as follows:
  (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 PHYS-
ICAL  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  EXIST-
ENCE  THEREOF  IS  FURNISHED IN SUCH FORM AND MANNER AS THE COMMISSIONER
MAY REQUIRE.
  (3) AN INDIVIDUAL TAXPAYER SHALL NOT BE TREATED AS  FINANCIALLY  DISA-
BLED DURING ANY PERIOD THAT SUCH INDIVIDUAL'S SPOUSE OR ANY OTHER PERSON
IS AUTHORIZED TO ACT ON BEHALF OF SUCH INDIVIDUAL IN FINANCIAL MATTERS.

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD09096-01-3

S. 4307                             2

  S  2. Subdivision (k) of section 11-1787 of the administrative code of
the city of New York is relettered subdivision (l) and a new subdivision
(k) is added to read as follows:
  (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 SUBDIVI-
SIONS (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 SUBDIVISION, AN INDIVIDUAL TAXPAYER IS AN
INDIVIDUAL WHO IS SUBJECT TO THE TAX IMPOSED UNDER THIS CHAPTER.
  (2) FOR PURPOSES OF PARAGRAPH ONE OF THIS SUBDIVISION,  AN  INDIVIDUAL
TAXPAYER  IS FINANCIALLY DISABLED IF SUCH INDIVIDUAL IS UNABLE TO MANAGE
HIS OR HER FINANCIAL AFFAIRS BY REASON OF A MEDICALLY DETERMINABLE PHYS-
ICAL 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 IMPAIRMENT UNLESS PROOF OF THE EXISTENCE
THEREOF IS FURNISHED IN SUCH FORM AND  MANNER  AS  THE  COMMISSIONER  OF
TAXATION AND FINANCE MAY REQUIRE.
  (3)  AN  INDIVIDUAL TAXPAYER SHALL NOT BE TREATED AS FINANCIALLY DISA-
BLED DURING ANY PERIOD THAT SUCH INDIVIDUAL'S SPOUSE OR ANY OTHER PERSON
IS AUTHORIZED TO ACT ON BEHALF OF SUCH INDIVIDUAL IN FINANCIAL MATTERS.
  S 3. This act shall take effect immediately and shall apply to periods
of financial disability commencing before, on, or after  the  date  this
act shall have become a law, but shall not apply to any claim for credit
or  refund  that (without regard to this act) is barred by the operation
of any law or rule of law (including res judicata) as of the  date  this
act shall have become a law.

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