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SECTION 171-E
Certain overpayments credited against national defense/national direct, health professions or nursing student loans
Tax (TAX) CHAPTER 60, ARTICLE 8
§ 171-e. Certain overpayments credited against national
defense/national direct, health professions or nursing student loans.
(1) As used in this section only, the term "state university loan" or
"city university loan" refers to loans provided to students at
state-operated units of the state university of New York or the city
university of New York respectively under the national defense/national
direct, health professions or nursing student loan programs.

(2) The commissioner of taxation and finance, on behalf of the tax
commission, shall enter into a written agreement with the state
university of New York or the city university of New York respectively
which shall set forth the procedures for crediting any overpayment by an
individual, estate or trust of income tax imposed by article twenty-two
of this chapter, city personal income tax on residents imposed pursuant
to the authority of article thirty of this chapter, city income tax
surcharge on residents imposed pursuant to the authority of article
thirty-A of this chapter, city earnings tax on nonresidents imposed
pursuant to the authority of article two-E of the general city law and
city earnings tax on nonresidents imposed pursuant to the authority of
article thirty-B of this chapter and the interest on such overpayments
against the amount of any default in repayment of a state university
loan or city university loan owed by such individual, estate or trust of
which the commissioner of taxation and finance has been notified by the
state university of New York or the city university of New York
respectively pursuant to the provisions of such agreement.

(3) Such agreement shall apply only to the amount of a default in
repayment of a state university loan or city university loan as to which
the state and/or state university of New York or the city university of
New York respectively has obtained a judgment or has made a
determination that satisfies the requirements of subdivision three of
section one hundred seventy-one-f of this article.

(4) Such agreement shall include:

(a) the procedure under which the state university of New York or the
city university of New York respectively shall notify the commissioner
of taxation and finance of a default in a repayment of a state
university loan or city university loan, such procedure to specify when
the commissioner of taxation and finance shall be notified and the
content of such notification;

(b) the minimum amount outstanding on a default in repayment of a
state university loan or city university loan against which the
commissioner of taxation and finance shall, pursuant to this section,
credit an overpayment;

(c) the procedure for reimbursement of the commissioner of taxation
and finance by the state university of New York or the city university
of New York respectively for the full cost of carrying out the
procedures authorized by this section;

(d) a provision providing that information furnished to the state
university of New York or the city university of New York respectively
by the commissioner of taxation and finance and the comptroller pursuant
to said agreement shall be considered confidential and shall not be
disclosed except to such federal or state department or agency entitled
to such information;

(e) such other matters as the parties to such agreement shall deem
necessary to carry out the provisions of this section; and

(f) the procedure for reimbursement of the comptroller by the state
university of New York or city university of New York for any
overpayment and interest thereon which has been credited against the
amount of default on repayment of a state university loan or a city
university loan owed by a taxpayer filing a joint return, but which has
been refunded by the comptroller, pursuant to paragraph six of
subsection (b) of section six hundred fifty-one of this chapter, to a
spouse not liable for the amount of default in repayment of a state
university loan or city university loan owed by such taxpayer.

(5) (a) In calculating the amount of an overpayment and interest
thereon which shall be credited against the amount of a default in
repayment of a state university loan or city university loan owed by a
taxpayer, the tax commission shall first credit the overpayment and
interest thereon against any:

(A) liability of such taxpayer in respect of any tax imposed by this
chapter;

(B) liability of such taxpayer for any tax imposed pursuant to the
authority of this chapter or any other law if such tax is administered
by the tax commission;

(C) estimated tax for the succeeding taxable year if such taxpayer
claims such overpayment or a portion thereof as a credit against
estimated tax for such succeeding taxable year pursuant to subsection
(e) of section six hundred eighty-six of this chapter or subdivision (e)
of section 11-1786 of the administrative code of the city of New York
for any tax imposed pursuant to the authority of this chapter or any
other law if such tax is administered by the tax commission; and

(D) past-due support owed by the taxpayer pursuant to section one
hundred seventy-one-c of this chapter;

(b) Only the balance remaining, after such overpayment and the
interest thereon has been credited as described in paragraph (a) of this
subdivision, shall be certified as an overpayment plus any interest to
be credited against the amount of a default in repayment of a state
university loan or city university loan, with the remainder to be
refunded to the taxpayer if such remainder is not required to satisfy
the amount of a past-due legally enforceable debt pursuant to section
one hundred seventy-one-f of this article, and/or a city of New York tax
warrant judgment debt pursuant to section one hundred seventy-one-l of
this article and/or the amount of a default in repayment of a guaranteed
student loan pursuant to section one hundred seventy-one-d of this
article.

(6) The tax commission shall certify to the comptroller the total
amount of the overpayment and the interest on such overpayment, the
amount of such overpayment and the interest on such amount to be
credited against the amount of the default in repayment of a state
university loan or city university loan and the balance of such
overpayment and interest to be refunded to the taxpayer.

(7) The commissioner of taxation and finance shall notify the taxpayer
making the overpayment, in writing, of the amount of such overpayment
and the interest thereon certified to the comptroller as the amount to
be credited against the amount of a default in repayment of a state
university loan or city university loan. Such notice shall include
notification to any other person who may have filed a joint return with
the taxpayer of the steps such other person may take in order to secure
his or her proper share of the refund.

(8) From the time the state tax commission is notified by the state
university of New York or the city university of New York respectively
of an individual's, estate's or trust's default in repayment of a state
university loan or city university loan under the agreement provided for
in this section, the state tax commission and the department of taxation
and finance shall be relieved from all liability to such individual,
estate or trust, their assigns, successors, heirs or representatives for
the amount of an overpayment and interest on such amount certified to
the comptroller to be credited against the amount of a default in
repayment of such state university loan or city university loan and such
individual, estate or trust shall have no right to commence a court
action or proceeding or to any other legal recourse against the state
tax commission or the department of taxation and finance to recover such
overpayment or such interest certified to the comptroller to be credited
against the amount of default in repayment of a state university loan or
city university loan. Provided, however, nothing herein shall be
construed to prohibit such individual, estate or trust from proceeding
against the state university of New York or the city university of New
York respectively to recover that part of such overpayment or interest
thereon so certified to the comptroller to be credited against the
amount of a default in repayment of a state university loan or city
university loan which is greater than the amount of such default owed by
such individual, estate or trust on the date of such certification.

(9) The tax commission shall promulgate such rules and regulations as
it deems necessary to carry out the provisions of this section.