senate Bill S4310A

Signed By Governor
2013-2014 Legislative Session

Makes a reduced rate of interest applicable to certain additions of tax resulting from discovery after filing an estate tax return of certain assets

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Sponsored By

Archive: Last Bill Status Via A5960 - 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
Jul 31, 2013 signed chap.197
Jul 19, 2013 delivered to governor
Jun 20, 2013 returned to assembly
passed senate
3rd reading cal.1481
substituted for s4310a
Jun 20, 2013 substituted by a5960a
ordered to third reading cal.1481
committee discharged and committed to rules
Jun 14, 2013 print number 4310a
amend and recommit to investigations and government operations
Mar 20, 2013 referred to investigations and government operations

Votes

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Bill Amendments

Original
A (Active)
Original
A (Active)

S4310 - Bill Details

See Assembly Version of this Bill:
A5960A
Law Section:
Tax Law
Laws Affected:
Add §991, Tax L; amd Part A §35, Chap 389 of 1997; amd §385, Chap 190 of 1990
Versions Introduced in Previous Legislative Sessions:
2011-2012: A5960
2009-2010: A7916

S4310 - Bill Texts

view summary

Makes a reduced rate of interest applicable to certain additions of tax resulting from discovery after filing an estate tax return of certain assets belonging to the decedent held by the state comptroller as abandoned property.

view sponsor memo
BILL NUMBER:S4310

TITLE OF BILL: An act to amend the tax law, in relation to making a
reduced rate of interest applicable to certain additions to tax
resulting from an executor's discovery after the date for filing an
estate tax return of certain assets belonging to the decedent held by
the state comptroller as abandoned property; and to amend chapter 389
of the laws of 1997 amending the tax law and other laws relating to
the estate and gift tax, and chapter 190 of the laws of 1990 amending
the tax law relating to certain taxes, fees, and other impositions, in
relation to rates of interest for certain estates

Purpose of Bill:

The bill would preclude the charging of interest on estate tax
liabilities attributable to late-discovered assets in the possession
of the State Comptroller as abandoned property for any period of time
during which the State Comptroller did not pay interest on the
property.

Summary of provisions:

Section 1 of the bill would add new section 991 to the Tax Law, which
relates to additional estate tax owed by an estate that is
attributable to an executor's discovery, after the date for the filing
of an estate tax return, of the existence of an estate asset in the
possession of the State Comptroller as abandoned property. The new
section would require the Commissioner of Taxation and Finance to not
charge interest on such additions to estate tax for any period in
which the State Comptroller did not pay interest on the asset it at
the time the estate's estate tax return was required to be filed,
including any extensions, the asset was not yet included in the public
records of abandoned property maintained by the State Comptroller.

Sections 2 and 3 of the bill would apply the same limitation on
accrual of interest as set forth in section 1 to estates of decedents
dying when prior versions of the New York estate tax were in effect
Thus, section 2 applies that interest limitation to estates of
decedents dying after March 31, 1963 and before February 1, 2000,
during which period an earlier version of Article 26's estate tax was
in effect (which was repealed by Chapter 389 of the Laws of 1997).
Section 3 would apply the limitation to estates of decedents dying on
or after June 1,1944, the date on which the State Comptroller was
first required to maintain public lists of abandoned property, and
before April 1, 1963, during which period former Article 10-C's estate
tax was in effect, prior to its being superseded by former Article 26,
pursuant to Chapter 1013 of the Laws of 1962.

Section 4 would make this bill effective immediately but applicable to
estates of decedents dying on or after June 1, 1944, the date on which
the State Comptroller was required to maintain public records of
abandoned property. Section 4 also would provide that no refunds or
credits would be Granted as a result of this act.

Existing law:


The discovery of assets after the date prescribed for paying the
estate tax, including property in the possession of the State
Comptroller as abandoned property, can create an additional estate tax
liability, either by increasing the tax due from an estate that
already filed an estate tax return or by putting a non-filing estate
over the threshold size that triggers the duty to pay estate tax.
Under all of these articles, interest is required to be charged if the
tax is late-paid (Tax Law § 990(b)(9), incorporating by reference Tax
Law § 683(c)(applicable to current article 26 and former article 26
for estates of decedents dying on or after May 25, 1990); former Tax
Law § 249-z (applicable to estates of decedents dying on or after
September 1, 1930 and before May 25, 1990)). Executors and heirs
holding estate property can be held liable for estate tax long after
the due date of any estate tax return. For example, in regard to
estates of decedents dying on or after May 25, 1990, there is no
statute of limitations for imposing additional estate tax if the
estate did not file a return (Tax Law § 990, incorporating by
reference Tax Law § 684). In relation to estates of decedents dying on
or after September 1, 1930 and before May 25, 1990, former Tax Law
section 249-x applied, which allowed additional estate tax to be
determined at any time based on unreported assets (former Tax Law
962(b) incorporating former Tax Law § 249x). Moreover, the Tax
Department continues to have collection authority under these present
and former estate tax articles in eases of late-discovered assets, as
an estate tax lien attaches to estate property for specified periods
(e.g., Tax Law § 982(a)(fifteen year lien; former Tax Law § 249-bb
(indefinite lien unless certain conditions are met)).

The Abandoned Property Law (APL) requires many entities, such as
banks, brokers, and utilities, and the court system, to turn over to
the State Comptroller certain types of customer property held by them
after the passage of a specified period of inactivity. Since 1944, the
State Comptroller has been required to maintain public records
regarding abandoned property that has been paid over to it (APL
1401). Prior to the enactment of Chapter 936 of the Laws of 1977, the
State Comptroller was not authorized to pay interest on abandoned
property. As amended by chapter 936, effective June 1, 1977, the APL
requires the State Comptroller to pay interest on certain types of
abandoned property, but only for the first five years the property is
in its possession, after which the State Comptroller ceases to pay
interest (APL § 1405).

Prior Legislative history:

This is a new proposal.

Statement in support:

It is often difficult for an executor of an estate to discover all the
assets of the decedent within the time allotted for filing the
estate's New York State estate tax return, which, under the current
estate tax, is nine months from the decedent's date of death (15
months if an extension is received). One difficulty is that
fiduciaries holding assets not discovered by the executor cannot treat
such assets as abandoned property to be turned over to the State
Comptroller until a statutorily set period of inactivity has expired,
which is often long after the estate's estate tax return is due. For


example, the period of activity with regard to bank accounts is three
years (APL § 300). Despite the passage of time, the late discovery of
an asset may trigger an estate tax liability if the estate tax statute
of limitations has not expired (e.g., the estate had not filed a
return, in which case there is no limitations period on assessment
under the current estate tax). The Tax Department is required to
charge interest from the due date of the estate tax return that should
have included the asset until such time as the tax is paid.

While the interest charged to the estate can be sizable, under APL
section 1405, the State Comptroller only pays interest on certain
categories of abandoned property and even then it only accrues
interest for the first five years that the property was in that
office's possession. Prior to that section's amendment in 1977, the
State Comptroller did not pay interest on any abandoned property.

In recent years, the State Comptroller has made efforts to encourage
people to search its records of abandoned property, now available as
searchable web-based databases. As a result, many people have been
able to find abandoned property formerly belonging to deceased persons
of whom they are heirs. The problem is that the newly discovered
estate asset often triggers an estate tax liability that the heir must
pay because the estate tax lien has not expired. The interest on the
estate tax liability generated by the late-discovered abandoned
property is sometimes as much as five to ten times the tax owed, while
the State has often paid little or no interest on the property.

This proposal would mitigate this inequity by directing the Tax
Department not to charge interest on any additional estate tax
liability owed by an estate based on the late-discovered asset for
periods in which the State Comptroller did not pay interest on that
asset. This provision would not apply if the asset was listed as
abandoned property in the public records of the State Comptroller
prior to the due date, with extensions, of the estate's estate tax
return and thus could have been discovered with due diligence by the
estate's executor.

Under section 4 of the bill, no refunds or credits will be paid as a
result of this bill.

Budget implications:

This proposal will result in a revenue loss of up to $200,000 annually
beginning in SFY13-14.

Local impact: None.

Effective Date:

The bill would take effect immediately and apply to estates of
decedents dying on or after June 1, 1944.

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

                                  4310

                       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, in relation to making  a  reduced  rate  of
  interest  applicable  to  certain  additions  to tax resulting from an
  executor's discovery after the date for filing an estate tax return of
  certain assets belonging to the decedent held by the state comptroller
  as abandoned property; and to amend chapter 389 of the  laws  of  1997
  amending  the  tax  law and other laws relating to the estate and gift
  tax, and chapter 190 of the laws of 1990 amending the tax law relating
  to certain taxes, fees, and other impositions, in relation to rates of
  interest for certain estates

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

  Section  1. The tax law is amended by adding a new section 991 to read
as follows:
  S 991. INTEREST ACCRUAL RELIEF  FOR  ADDITIONAL  TAX  ATTRIBUTABLE  TO
NEWLY-DISCOVERED ABANDONED PROPERTY. NOTWITHSTANDING ANY OTHER PROVISION
OF  LAW,  IN COMPUTING THE INTEREST DUE ON AN ADDITION TO TAX OWED BY AN
ESTATE ATTRIBUTABLE TO THE  INCLUSION  IN  THE  ESTATE'S  FEDERAL  GROSS
ESTATE  OF  AN  ASSET  HELD BY THE COMPTROLLER AS ABANDONED PROPERTY AND
ACCRUING INTEREST PURSUANT TO SECTION FOURTEEN HUNDRED FIVE OF THE ABAN-
DONED PROPERTY LAW, NO INTEREST SHALL ACCRUE FOR ANY PERIOD OF  TIME  IN
WHICH  THE  COMPTROLLER  CEASED TO PAY INTEREST ON THE ASSET PURSUANT TO
THE FIVE-YEAR LIMITATION IN SUBDIVISION ONE OF SECTION FOURTEEN  HUNDRED
FIVE OF THE ABANDONED PROPERTY LAW IF, AS OF THE DATE PRESCRIBED FOR THE
FILING  OF  A  RETURN REQUIRED BY THIS ARTICLE, INCLUDING ANY EXTENSIONS
GRANTED FOR FILING, INFORMATION PERTAINING TO  THE  ASSET  HAD  NOT  YET
APPEARED  IN  THE  PUBLIC  RECORDS  OF ABANDONED PROPERTY REQUIRED TO BE

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD09097-01-3

S. 4310                             2

MAINTAINED BY THE COMPTROLLER PURSUANT TO SECTION FOURTEEN  HUNDRED  ONE
OF THE ABANDONED PROPERTY LAW.
  S  2. Section 35 of part A of chapter 389 of the laws of 1997 amending
the tax law and other laws relating to  the  estate  and  gift  tax,  is
amended to read as follows:
  S  35.    All  provisions  of  law repealed or deleted by sections one
through thirty-four of this act, and of the regulations  adopted  there-
under,  in respect to the assessment, payment, determination, collection
and refund of taxes or other impositions imposed thereunder, the  filing
of returns and preservation of records for the purposes of such taxes or
impositions,  the  secrecy  of  returns, and the disposition of revenues
shall continue in effect with respect to all such taxes  or  impositions
accrued  up to the effective date of this section[.]; PROVIDED, HOWEVER,
THAT, WITH REGARD TO AN ADDITION TO TAX OWNED BY AN ESTATE  ATTRIBUTABLE
TO  THE  INCLUSION  IN THE ESTATE'S GROSS ESTATE OF AN ASSET HELD BY THE
STATE COMPTROLLER AS ABANDONED PROPERTY, NO INTEREST  SHALL  ACCRUE  FOR
ANY PERIOD OF TIME IN WHICH THE STATE COMPTROLLER CEASED TO PAY INTEREST
ON  THE  ASSET  PURSUANT  TO  THE FIVE-YEAR LIMITATION ON THE PAYMENT OF
INTEREST IN SUBDIVISION 1 OF SECTION 1405 OF THE ABANDONED PROPERTY LAW.
THIS CAP ON THE PERIOD OF TIME DURING WHICH INTEREST WILL  ACCRUE  SHALL
APPLY  ONLY  IF,  AS  OF THE DATE PRESCRIBED FOR THE FILING OF A RETURN,
INCLUDING ANY EXTENSIONS GRANTED FOR FILING, INFORMATION  PERTAINING  TO
THE  ASSET HAD NOT YET APPEARED IN THE PUBLIC RECORDS OF ABANDONED PROP-
ERTY REQUIRED TO BE MAINTAINED BY  THE  STATE  COMPTROLLER  PURSUANT  TO
SECTION 1401 OF THE ABANDONED PROPERTY LAW.
  S  3.  Paragraph 1 of subdivision (i) of section 385 of chapter 190 of
the laws of 1990 amending the tax law relating to certain  taxes,  fees,
and  other impositions, as amended by section 71 of part A of chapter 56
of the laws of 1998, is amended to read as follows:
  (1) All provisions of articles 10-A, 10-B, 10-C and section 962 of the
tax law (as repealed by section  one  hundred  eight  of  this  act)  in
respect  to  the  imposition, rates, appraisal and valuation of estates,
filing of tax, assessment, determination, payment, collection and refund
of the taxes imposed or administered thereunder, the filing  of  reports
and  returns,  the  final federal determinations, imposition of interest
and penalties, the jurisdiction of surrogates' courts, provisions relat-
ing to appeals and the disposition of revenues and fees  shall  continue
in effect with respect to all such taxes accrued on or before the effec-
tive  date  of  this  act,  except that (A) section 249-u of the tax law
shall not be applicable after the effective date of this act,  (B)  with
respect  to any of the provisions of article 10-C thereof relating to an
appraiser, the appraiser shall  be  the  commissioner  of  taxation  and
finance  or  his  designee on and after such date, and (C) the fee for a
release of lien imposed by subdivision c of section  249-bb,  which  was
applicable  to  estates  of decedents subject to tax under article 26 of
the tax law by reason of section 962 thereof, shall not  be  applicable;
PROVIDED  THAT,  WITH  REGARD  TO  AN  ADDITION TO TAX OWED BY AN ESTATE
ATTRIBUTABLE TO THE INCLUSION IN THE ESTATE'S FEDERAL GROSS ESTATE OF AN
ASSET HELD BY THE STATE COMPTROLLER AS ABANDONED PROPERTY,  NO  INTEREST
SHALL  ACCRUE  FOR  ANY  PERIOD  OF  TIME IN WHICH THE STATE COMPTROLLER
CEASED TO PAY INTEREST ON THE ASSET PURSUANT TO THE FIVE-YEAR LIMITATION
ON THE PAYMENT OF INTEREST IN SUBDIVISION 1 OF SECTION 1405 OF THE ABAN-
DONED PROPERTY LAW. THIS CAP ON THE PERIOD OF TIME DURING WHICH INTEREST
WILL ACCRUE SHALL APPLY ONLY IF, AS  OF  THE  DATE  PRESCRIBED  FOR  THE
FILING  OF A RETURN, INCLUDING ANY EXTENSIONS GRANTED FOR FILING, INFOR-
MATION PERTAINING TO THE ASSET  HAD  NOT  YET  APPEARED  IN  THE  PUBLIC

S. 4310                             3

RECORDS  OF  ABANDONED  PROPERTY  REQUIRED TO BE MAINTAINED BY THE STATE
COMPTROLLER PURSUANT TO SECTION 1401 OF THE ABANDONED PROPERTY LAW;
  S 4. This act shall take effect immediately and shall apply to estates
of decedents dying on or after June 1, 1944, provided that no refunds or
credit shall be granted as a result of any provision of this act.

S4310A (ACTIVE) - Bill Details

See Assembly Version of this Bill:
A5960A
Law Section:
Tax Law
Laws Affected:
Add §991, Tax L; amd Part A §35, Chap 389 of 1997; amd §385, Chap 190 of 1990
Versions Introduced in Previous Legislative Sessions:
2011-2012: A5960
2009-2010: A7916

S4310A (ACTIVE) - Bill Texts

view summary

Makes a reduced rate of interest applicable to certain additions of tax resulting from discovery after filing an estate tax return of certain assets belonging to the decedent held by the state comptroller as abandoned property.

view sponsor memo
BILL NUMBER:S4310A

TITLE OF BILL: An act to amend the tax law, in relation to making a
reduced rate of interest applicable to certain additions to tax
resulting from an executor's discovery after the date for filing an
estate tax return of certain assets belonging to the decedent held by
the state comptroller as abandoned property; and to amend chapter 389
of the laws of 1997 amending the tax law and other laws relating to
the estate and gift tax, and chapter 190 of the laws of 1990 amending
the tax law relating to certain taxes, fees, and other impositions, in
relation to rates of interest for certain estates

PURPOSE:

The bill would preclude the charging of interest on estate tax
liabilities attributable to late-discovered assets in the possession
of the State Comptroller as abandoned property for any period of time
during which the State Comptroller did not pay interest on the
property.

SUMMARY OF PROVISIONS:

Section 1 of the bill would add new section 991 to the Tax Law, which
relates to additional estate tax owed by an estate that is
attributable to an executor's discovery, after the date for the filing
of an estate tax return, of the existence of an estate asset in the
possession of the State Comptroller as abandoned property. The new
section would require the Commissioner of Taxation and Finance to not
charge interest on such additions to estate tax for any period in
which the State Comptroller did not pay interest on the asset if, at
the time the estate's estate tax return was required to be filed,
including any extensions, the asset was not yet included in the public
records of abandoned property maintained by the State Comptroller.

Sections 2 and 3 of the bill would apply the same limitation on
accrual of interest as set forth in section 1 to estates of decedents
dying when prior versions of the New York estate tax were in effect.
Thus, section 2 applies that interest limitation to estates of
decedents dying after March 31, 1963 and before February 1, 2000,
during which period an earlier version of Article 26's estate tax was
in effect (which was repealed by Chapter 389 of the Laws of 1997).

Section 3 would apply the limitation to estates of decedents dying on
or after June 1, 1944, the date on which the State Comptroller was
first required to maintain public lists of abandoned property, and
before April 1, 1963, during which .period former Article 10-C's
estate tax was in effect, prior to its being superseded by former
Article 26, pursuant to Chapter 1013 of the Laws of 1962.

Section 4 would make this bill effective immediately but applicable to
estates of decedents dying on or after June 1, 1944, the date on which
the State Comptroller was required to maintain public records of
abandoned property. Section 4 also would provide that no refunds or
credits would be granted as a result of this act.

EXISTING LAW:


The discovery of assets after the date prescribed for paying the
estate tax, including property in the possession of the State
Comptroller as abandoned property, can create an additional estate tax
liability, either by increasing the tax due from an estate that
already filed an estate tax return or by putting a non-filing estate
over the threshold size that triggers the duty to pay estate tax.
Under all of these articles, interest is required to be charged if the
tax is late-paid (Tax Law § 990-b 9, incorporating by reference Tax
Law 5 683-c applicable to current article 26 and former article-26 for
estates of decedents dying on or after May 25, 1990; former Tax Law
249-z applicable to estates of decedents dying on or after September
1, 1930 and before May 25, 1990). Executors and heirs holding estate
property can be held liable for estate tax long after the due date of
any estate tax return. For example, in regard to estates of decedents
dying on or after May 25, 1990, there is no statute of limitations for
imposing additional estate tax if the estate did not file a return
(Tax Law § 990, incorporating by reference Tax Law § 684). In relation
to estates of decedents dying on or after September 1, 1930 and before
May 25, 1990, former Tax Law section 249-x applied, which allowed
additional estate tax to be determined at any time based on unreported
assets (former Tax Law § 962b incorporating former Tax Law § 249-z).
Moreover, the Tax Department continues to have collection authority
under these present and former estate tax articles in eases of
late-discovered assets, as an estate tax lien attaches to estate
property for specified periods (e.g., Tax Law § 982-a fifteen year
lien; former Tax Law § 249-bb indefinite lien unless certain
conditions are met).

The Abandoned Property Law (APL) requires many entities, such as
banks, brokers, arid utilities, and the court system, to turn over to
the State Comptroller certain types of customer property held by them
after the passage of a specified period of inactivity. Since 1944, the
State Comptroller has been required to maintain public records
,regarding abandoned property that has been paid over to it (APL
1401). Prior to the enactment of Chapter 936 of the Laws of 1977, the
State Comptroller was not authorized to pay interest on abandoned
property. As amended by chapter 936, effective June 1, 1977, the APL
requires the State Comptroller to pay interest on certain types of
abandoned property, but only for the first five years the property is
in its possession, after which the State Comptroller ceases to pay
interest (APL § 1405).

JUSTIFICATION:

It is often difficult for an executor of an estate to discover all the
assets of the decedent within the time allotted for filing the
estate's New York State estate tax return, which, under the current
estate tax, is nine months from the decedent's date of death (15
months if an extension is received). One difficulty is that
fiduciaries holding assets not discovered by-the executor cannot treat
such assets as abandoned property to be turned over to the State
Comptroller until a statutorily set period of inactivity has expired,
which is often long after the estate's estate tax return is due. For
example, the period of activity with regard to bank accounts is three
years (APL § 300). Despite the passage of time, the late discovery of
an asset may trigger an estate tax liability if the estate tax statute
of limitations has not expired (e.g., the estate had not filed a


return, in which case there is no limitations period on assessment
under the current estate tax). The Tax Department is required to
charge interest from the due date of the estate tax return that should
have included the asset until such time as the tax is maid.

While the interest charged to the estate can be sizable, under APL
section 1405, the State Comptroller only pays interest on certain
categories of abandoned property and even then it only accrues
interest for the first five years that the property was in that
office's possession.

Prior to that section's amendment in 1977, the State Comptroller did
not pay interest on any abandoned property.

In recent years, the State Comptroller has made efforts to encourage
people to search its records of abandoned property, now available as
searchable web-based databases. As a result, many people have been
able to find abandoned property formerly belonging to deceased persons
of whom they are heirs. The problem is that the newly discovered
estate asset often triggers an estate tax liability that the heir must
pay because the estate tax lien has not expired. The interest on the
estate tax liability generated by the late-discovered abandoned
property is sometimes as much as five to ten times the tax owed, while
the State has often paid little or no interest on the property.

This proposal would mitigate this inequity by directing the Tax
Department not to charge interest on any additional estate tax
liability owed by an estate based on the late-discovered asset for
periods in which the State Comptroller did not pay interest on that
asset. This provision would not apply if the asset was listed as
abandoned property in the public records of the State Comptroller
prior to the due date, with extensions, of the estate's estate tax
return and thus could have been discovered with due diligence by the
estate's executor.

Under section 4 of the bill, no refunds or credits will be maid as a
result of this bill.

LEGISLATIVE HISTORY:

New Bill.

FISCAL IMPLICATIONS:

This proposal will result in a revenue loss of up to $400,000 annually
beginning in SFY13-14.

EFFECTIVE DATE:

The bill would take effect immediately and apply to estates of
decedents dying on or after June 1, 1944.

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

                                 4310--A

                       2013-2014 Regular Sessions

                            I N  S E N A T E

                             March 20, 2013
                               ___________

Introduced  by  Sen.  MARCELLINO  -- read twice and ordered printed, and
  when printed to be committed to the Committee  on  Investigations  and
  Government  Operations  -- committee discharged, bill amended, ordered
  reprinted as amended and recommitted to said committee

AN ACT to amend the tax law, in relation to making  a  reduced  rate  of
  interest  applicable  to  certain  additions  to tax resulting from an
  executor's discovery after the date for filing an estate tax return of
  certain assets belonging to the decedent held by the state comptroller
  as abandoned property; and to amend chapter 389 of the  laws  of  1997
  amending  the  tax  law and other laws relating to the estate and gift
  tax, and chapter 190 of the laws of 1990 amending the tax law relating
  to certain taxes, fees, and other impositions, in relation to rates of
  interest for certain estates

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

  Section  1. The tax law is amended by adding a new section 991 to read
as follows:
  S 991. INTEREST ACCRUAL RELIEF  FOR  ADDITIONAL  TAX  ATTRIBUTABLE  TO
NEWLY-DISCOVERED ABANDONED PROPERTY. NOTWITHSTANDING ANY OTHER PROVISION
OF  LAW,  IN COMPUTING THE INTEREST DUE ON AN ADDITION TO TAX OWED BY AN
ESTATE ATTRIBUTABLE TO THE  INCLUSION  IN  THE  ESTATE'S  FEDERAL  GROSS
ESTATE  OF  AN  ASSET HELD BY THE COMPTROLLER AS ABANDONED PROPERTY, THE
COMMISSIONER SHALL APPLY THE INTEREST  RATE  USED  BY  THE  COMPTROLLER,
PURSUANT TO SECTION FOURTEEN HUNDRED FIVE OF THE ABANDONED PROPERTY LAW,
IN  COMPUTING  THE  INTEREST DUE ON SUCH ABANDONED PROPERTY WHILE IN THE
COMPTROLLER'S POSSESSION (INCLUDING A ZERO RATE IF THE  COMPTROLLER  DID
NOT PAY INTEREST ON SUCH PROPERTY) IF, AS OF THE DATE PRESCRIBED FOR THE
FILING  OF  A  RETURN REQUIRED BY THIS ARTICLE, INCLUDING ANY EXTENSIONS
GRANTED FOR FILING, INFORMATION PERTAINING TO  THE  ASSET  HAD  NOT  YET
APPEARED  IN  THE  PUBLIC  RECORDS  OF ABANDONED PROPERTY REQUIRED TO BE
MAINTAINED BY THE COMPTROLLER PURSUANT TO SECTION FOURTEEN  HUNDRED  ONE
OF THE ABANDONED PROPERTY LAW.

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD09097-03-3

S. 4310--A                          2

  S  2. Section 35 of part A of chapter 389 of the laws of 1997 amending
the tax law and other laws relating to  the  estate  and  gift  tax,  is
amended to read as follows:
  S  35.    All  provisions  of  law repealed or deleted by sections one
through thirty-four of this act, and of the regulations  adopted  there-
under,  in respect to the assessment, payment, determination, collection
and refund of taxes or other impositions imposed thereunder, the  filing
of returns and preservation of records for the purposes of such taxes or
impositions,  the  secrecy  of  returns, and the disposition of revenues
shall continue in effect with respect to all such taxes  or  impositions
accrued  up to the effective date of this section[.]; PROVIDED, HOWEVER,
THAT, IN COMPUTING THE INTEREST DUE ON AN ADDITION TO  TAX  OWED  BY  AN
ESTATE  ATTRIBUTABLE TO THE INCLUSION IN THE ESTATE'S GROSS ESTATE OF AN
ASSET HELD BY THE STATE COMPTROLLER AS ABANDONED PROPERTY,  THE  COMMIS-
SIONER OF TAXATION AND FINANCE SHALL APPLY THE INTEREST RATE USED BY THE
COMPTROLLER,  PURSUANT TO SECTION 1405 OF THE ABANDONED PROPERTY LAW, IN
COMPUTING THE INTEREST DUE ON SUCH ABANDONED PROPERTY WHILE IN THE COMP-
TROLLER'S POSSESSION (INCLUDING A ZERO RATE IF THE COMPTROLLER  DID  NOT
PAY  INTEREST  ON  SUCH  PROPERTY) IF, AS OF THE DATE PRESCRIBED FOR THE
FILING OF A RETURN, INCLUDING ANY EXTENSIONS GRANTED FOR FILING,  INFOR-
MATION  PERTAINING  TO  THE  ASSET  HAD  NOT  YET APPEARED IN THE PUBLIC
RECORDS OF ABANDONED PROPERTY REQUIRED TO BE  MAINTAINED  BY  THE  STATE
COMPTROLLER PURSUANT TO SECTION 1401 OF THE ABANDONED PROPERTY LAW.
  S  3.  Paragraph 1 of subdivision (i) of section 385 of chapter 190 of
the laws of 1990 amending the tax law relating to certain  taxes,  fees,
and  other impositions, as amended by section 71 of part A of chapter 56
of the laws of 1998, is amended to read as follows:
  (1) All provisions of articles 10-A, 10-B, 10-C and section 962 of the
tax law (as repealed by section  one  hundred  eight  of  this  act)  in
respect  to  the  imposition, rates, appraisal and valuation of estates,
filing of tax, assessment, determination, payment, collection and refund
of the taxes imposed or administered thereunder, the filing  of  reports
and  returns,  the  final federal determinations, imposition of interest
and penalties, the jurisdiction of surrogates' courts, provisions relat-
ing to appeals and the disposition of revenues and fees  shall  continue
in effect with respect to all such taxes accrued on or before the effec-
tive  date  of  this  act,  except that (A) section 249-u of the tax law
shall not be applicable after the effective date of this act,  (B)  with
respect  to any of the provisions of article 10-C thereof relating to an
appraiser, the appraiser shall  be  the  commissioner  of  taxation  and
finance  or  his  designee on and after such date, and (C) the fee for a
release of lien imposed by subdivision c of section  249-bb,  which  was
applicable  to  estates  of decedents subject to tax under article 26 of
the tax law by reason of section 962 thereof, shall not  be  applicable;
PROVIDED  THAT,  WITH  REGARD  TO  AN  ADDITION TO TAX OWED BY AN ESTATE
ATTRIBUTABLE TO THE INCLUSION IN THE ESTATE'S FEDERAL GROSS ESTATE OF AN
ASSET HELD BY THE STATE COMPTROLLER AS ABANDONED PROPERTY,  NO  INTEREST
SHALL  ACCRUE  FOR ANY PERIOD OF TIME IN WHICH THE STATE COMPTROLLER DID
NOT PAY INTEREST ON THE ASSET IF, AS OF  THE  DATE  PRESCRIBED  FOR  THE
FILING  OF A RETURN, INCLUDING ANY EXTENSIONS GRANTED FOR FILING, INFOR-
MATION PERTAINING TO THE ASSET  HAD  NOT  YET  APPEARED  IN  THE  PUBLIC
RECORDS  OF  ABANDONED  PROPERTY  REQUIRED TO BE MAINTAINED BY THE STATE
COMPTROLLER PURSUANT TO SECTION 1401 OF THE ABANDONED PROPERTY LAW;
  S 4. This act shall take effect immediately and shall apply to estates
of decedents dying on or after June 1, 1944, provided that no refunds or
credit shall be granted as a result of any provision of this act.

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