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SECTION 1088
Interest on overpayment
Tax (TAX) CHAPTER 60, ARTICLE 27
§ 1088. Interest on overpayment.--(a) General.--Notwithstanding the
provisions of section sixteen of the state finance law, interest shall
be allowed and paid as follows at the overpayment rate set by the
commissioner of taxation and finance pursuant to section one thousand
ninety-six, or if no rate is set, at the rate of six percent per annum
upon any overpayment in respect of the tax imposed by article nine or
nine-a:

(1) from the date of the overpayment to the due date of an amount
against which a credit is taken;

(2) from the date of the overpayment to a date (to be determined by
the commissioner) preceding the date of a refund check by not more than
thirty days, whether or not such refund check is accepted by the
taxpayer after tender of such check to the taxpayer. The acceptance of
such check shall be without prejudice to any right of the taxpayer to
claim any additional overpayment and interest thereon.

(3) Late and amended returns and claims for credit or refund.
Notwithstanding paragraph one or two of this subsection, in the case of
an overpayment claimed on a return of tax which is filed after the last
date prescribed for filing such return (determined with regard to
extensions), or claimed on an amended return of tax or claimed on a
claim for credit or refund, no interest shall be allowed or paid for any
day before the date on which such return or claim is filed.

(4) Interest on certain refunds. To the extent provided for in
regulations promulgated by the commissioner of taxation and finance, if
an item of income, gain, loss, deduction or credit is changed from the
taxable year or period in which it is reported to the taxable year or
period in which it belongs and the change results in an underpayment in
a taxable year or period and an overpayment in some other taxable year
or period, the provisions of paragraph three of this subsection with
respect to an overpayment shall not be applicable to the extent that the
limitation in such paragraph on the right to interest would result in a
taxpayer not being allowed interest for a length of time with respect to
an overpayment while being required to pay interest on an equivalent
amount of the related underpayment. However, this paragraph shall not be
construed as limiting or mitigating the effect of any statute of
limitations or any other provision of law relating to the authority of
such commissioner to issue a notice of deficiency or to allow a credit
or refund on an overpayment.

(5) Amounts of less than five dollars. No interest shall be allowed or
paid if the amount thereof is less than five dollars.

(b) Advance payment of tax and estimated tax.--The provisions of
subsections (h) and (i) of section one thousand eighty-seven applicable
in determining the date of payment of tax for purposes of determining
the period of limitations on credit or refund, shall be applicable in
determining the date of payment for purposes of this section.

(c) Tax refund within three months of claim for overpayment. (1) If
any overpayment of tax imposed by article nine or nine-a is credited or
refunded within three months after the last date prescribed (or
permitted by extension of time) for filing the return of such tax on
which such overpayment was claimed or within three months after such
return was filed, whichever is later, or within three months after an
amended return was filed claiming such overpayment or within three
months after a claim for credit or refund was filed on which such
overpayment was claimed, no interest shall be allowed under this section
on any such overpayment. For purposes of this subsection, any amended
return or claim for credit or refund filed before the last day
prescribed (or permitted by extension of time) for the filing of the
return of tax for such year or period shall be considered as filed on
such last day.

(2) In the case of an overpayment of tax credited due to absence of
application by the taxpayer for refund under subsection (a) of section
one thousand eighty-six, where the commissioner notifies the taxpayer
that such overpayment has been so credited within three months after the
last date prescribed (or permitted by extension of time) for filing the
return of such tax on which such overpayment was claimed or within three
months after such return was filed, whichever is later, and where the
taxpayer subsequent to such notice makes a claim for refund of all or
part of such overpayment, no interest shall be allowed under this
section prior to the date of such claim for refund.

(d) Refund of tax caused by carryback.--For purposes of this section,
if any overpayment of tax imposed by article nine-a results from a
carryback of a net operating loss or a net capital loss, such
overpayment shall be deemed not to have been made prior to the filing
date for the taxable year in which such net operating loss or net
capital loss arises. In the case of a taxpayer which has made an
election under subchapter s of chapter one of the internal revenue code,
where an overpayment of tax results from a carryback of a net operating
loss arising in a taxable year ending on or after December thirty-first,
nineteen hundred seventy-six, or from a carryback of a net capital loss
arising in a taxable year ending on or after December thirty-first,
nineteen hundred eighty-one, unless a claim for refund based on such
overpayment has been filed within a period ending twelve months and one
hundred eighty days subsequent to the last day of the taxable year in
which the net operating loss or net capital loss arises, interest on any
resulting refund or credit shall cease to accrue upon the conclusion of
such period. Such filing date shall be determined without regard to
extensions of time to file. For purposes of subsection (c) of this
section any overpayment described herein shall be treated as an
overpayment for the loss year and such subsection shall be applied with
respect to such overpayment by treating the return for the loss year as
not filed before claim for such overpayment is filed. The term "loss
year" means the taxable year in which such loss arises.

(e) No interest until return in processible form.--

(1) For purposes of subsections (a) and (c) of this section, a return
shall not be treated as filed until it is filed in processible form.

(2) For purposes of paragraph one of this subsection, a return is in a
processible form if--

(A) such return is filed on a permitted form, and

(B) such return contains--

(i) the taxpayer's name, address, and indentifying number and the
required signatures, and

(ii) sufficient required information (whether on the return or on
required attachments) to permit the mathematical verification of tax
liability shown on the return.

(f) Overpayment credited against past-due legally enforceable
debts.--If interest is payable pursuant to this section on that portion
of an overpayment which is certified by the commissioner of taxation and
finance to the comptroller as the amount to be credited against a
past-due legally enforceable debt pursuant to the provisions of section
one hundred seventy-one-f of this chapter, or a city of New York tax
warrant judgment debt pursuant to the provisions of section one hundred
seventy-one-l of this chapter, such portion of such an overpayment shall
cease to bear interest on the date of such certification.

(g) Cross-reference.--For provision with respect to interest after
failure to file a report or amended return under subdivision three of
section two hundred eleven or paragraph one of subdivision (e) of
section fifteen hundred fifteen, see subsection (c) of section one
thousand eighty-seven.

(h) Notwithstanding any other provision in this section, for taxable
years beginning on or after January first, two thousand eight and before
January first, two thousand nine, interest will be allowed on an
overpayment on any return or report on which one or more empire zone tax
credits are claimed, only from the one hundred eightieth day after the
taxpayer files with the department an empire zone retention certificate
issued pursuant to subdivision (w) of section nine hundred fifty-nine of
the general municipal law to the empire zone enterprise which is the
basis for the tax credit or credits claimed on the return or report.