State Should Provide Tax Refunds in 30 Days, Winner Says

George Winner

February 22, 2010

Albany, N.Y.—State Senator George Winner (R-C-I, Elmira) has introduced legislation to require the state to provide personal income tax refunds within 30 days after a taxpayer files a return.

“Albany’s leaders shouldn’t be allowed to keep making taxpayers the scapegoats for this fiscal crisis,” said Winner, noting that the 2009-2010 state budget enacted by Governor David Paterson and legislative leaders last April increased state taxes and fees by more than $8 billion, and included the elimination of the STAR property tax rebate program.  “State and local taxpayers shouldn’t be the first place to turn when Albany goes looking for a way out of a fiscal challenge.  It’s a mindset that has to end.”

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The Senate Republican conference has offered a plan to respond to New York’s long-term, deep-rooted fiscal crisis by taking actions to encourage economic growth, cut government waste, and permanently cap state spending.

Winner noted that he introduced the 30-day tax refund repayment measure prior to last week’s news reports that the Paterson administration is considering delaying payment of state income tax refunds to thousands of state taxpayers as a deficit reduction tool. 

Winner said, however, that the Paterson plan has highlighted the need for legislation to put a stop to the practice.

“Taxpayers should receive timely refunds,” Winner said.  “It’s their money, and they need it.  It’s a terrible economic time to ask hard-pressed taxpayers to wait a little longer for a tax return that they’ve earned.”

Winner’s legislation is sponsored in the Assembly by Assemblyman Richard Brodsky (D-Westchester), chairman of the Assembly Committee on Corporations, Authorities and Commissions.

Under the legislation (S.3985/A.5100), the state Department of Taxation and Finance would be required to pay a taxpayer's refund within 30 days after receiving the taxpayer’s filing. If the department is unable to pay a tax refund because of a discrepancy in the taxpayer’s return, it would be required to provide written notice to the taxpayer of the discrepancy and an expected timeframe for its resolution. If the department fails to provide a refund or written notice within 30 days, the taxpayer would be paid interest on the refund owed at a rate of six percent per annum.

The state currently caps the amount of income-tax refunds it pays before March 31st of each fiscal year to  $1.75 billion. The Paterson proposal under consideration would lower the cap to $1.25 billion.  It could possibly result in a two-month delay for many taxpayers waiting for a state income tax refund.