Our New York City tax and accounting office and nyc cpa are dedicated to keeping our clients up to date to NYC tax changes. Today, the New York Division of Taxation’s notice of proposed driver license suspension referral issued to the taxpayer for nonpayment of sales and use taxes under Tax Law 171-v was upheld.

The evidence demonstrated that there existed fixed and final tax liabilities owed by the taxpayer with respect to which he no longer had any right to administrative or judicial review. Thus, the division met the threshold requirement of Tax Law 171-v by establishing the taxpayer’s past-due tax liability. The taxpayer contended the suspension referral should have been cancelled because he was not a taxpayer that owed the underlying tax liability. However, this contention was rejected because the notice of determination was issued to the taxpayer, and had become a fixed and final liability. His opportunity to dispute the underlying merits of the notice of determination expired when he failed to file a challenge within 90 days of its issuance. Also, the taxpayer maintained that the past-due liabilities were satisfied by a forfeiture agreement, thereby requiring cancellation of the suspension referral. However, this argument was also rejected.

The notice of determination, issued after the forfeiture, asserted penalties and interest against the taxpayer. This amount was neither timely challenged nor paid. Meanwhile, the forfeiture was a criminal sanction without any encumbrance upon ensuing civil liability, including penalties and interest. The taxpayer did not clearly and convincingly demonstrate an accord and satisfaction of civil liability with the division arising from the forfeiture. Therefore, the taxpayer’s petition was denied and the notice of proposed license suspension referral was sustained.

Our NYC CPA practice will continue to monitor this tax ruling and provide updates as needed. Questions? Please contact us if you have any questions.