How long can the NYS Tax Department aggressively enforce against you ?
How Long Does the NYS Tax Department Have to Collect a Balance Due
A Statute of Limitations [ as it pertains to a tax liability] is the duration of time that the NYS Tax Department can legally attempt to collect on a tax debt.
The New York State Department of Taxation and Finance cannot collect on you forever. Generally, the NYS Tax Department will have 20 years to collect a liability from the date that the tax liability has been warranted.
Once a NYS tax warrant is issued, the clock will begin to tick. 20 years is a long time given the aggressive enforcement tactics of the NYS Tax Department.
And, of course, there are exceptions.
For example, one of the exceptions is if you have failed to file your income tax return.
Also, a taxpayer and the NYS Tax Department may agree in writing to extend the statute of limitations before it expires.
Non-Filer Exception to Statute of Limitations
Failing to file an income tax return for a particular tax year does not relieve you from the tax liability for that tax year.
Therefore, if you have unfiled income tax returns, NYS can collect from you forever on that tax year.
Further, if you have tried to hide income or have filed a fraudulent income tax return, the statute of limitations does not apply on the NYS Tax Department on trying to collect on a NYS balance due.
How Long Does NYS Have to Assert Additional Tax Due
New York State generally has a three-year statute of limitations on their right to impose additional tax due [ generally, three years after you filed your income tax return].
A six year statute of limitations applies to assert additional tax due when there is an abusive tax avoidance transaction or when a taxpayer omits 25% or more of their income from his or her income tax return.
Not Responding to Tax Notices ? What’s Next from NYS
Below are the methods that the NYS Tax Department will enforce your tax liability:
New York State Tax Warrant
A New York State tax warrant is a lien against all of your property [ bank accounts, investments, retirement accounts, real estate, etc. ]
It gives the New York State Tax Department the legal authority to seize your property [ see above ] and garnish your wages if you are employed.
If you own real estate, you will be unable to sell the property without first paying NYS the underlying tax as well as the penalties and interest, that both accrue on a daily basis.
Bank Account Levies
NYS can levy your bank account up to 100% of the tax liability. NYS will continue to levy your bank account until such time that the tax, including penalties and interest are paid in full.
Seizures
New York State can seize against all of your personal and business property [ bank accounts, investments, retirement accounts, real estate, business assets etc. ]
Income Execution
NYS will contact your employer. Your employer will be legally required to send 10% of your wages, until such time that the entire balance of your tax debt is paid.
NY Driver’s License Suspension
If you owe more than $10,000 to the New York Department of Taxation and Finance, your driver’s license will be suspended at some point.
Assignment of NYS Tax Agent
If the NYS Tax Department determines that your matter is a serious tax matter, a NYS Tax Agent will come to your home and/or place of business. A NYS Tax Agent will aggressively enforce against your assets and income.
Tax Refund Offset
If you owe NYS back taxes, the NY will keep any IRS and NY refunds that you are entitled to and apply the refunds to the tax liabilities.
Get Tax Help
Twenty (20) or more years is too long to try to hide from the aggressive enforcement of the NYS Tax Department. NYS can and will chase you across state lines to enforce against you so it doesn’t matter where you live.
If you have an unfiled income tax return or owe a tax liability, the NYS tax attorneys of the Tax Problem Law Center can be of help.
