N.Y. Tax Law § 171-F — Certain overpayments credited against outstanding debts owed to a state agency

§ 171-f. Certain overpayments credited against outstanding debts owed\nto a state agency. (1) For the purposes of this section, (a) "state\nagency" shall mean any state department, board, bureau, division,\ncommission, committee, public authority, public benefit corporation,\ncouncil, office, or other governmental entity performing a governmental\nor proprietary function for the state, or, solely for purposes of this\nsection, a local social services district; (b) "taxpayer" shall mean a\ncorporation, association, company, partnership, estate, trust,\nliquidator, fiduciary or other entity or individual who or which is\nliable for any tax or other imposition imposed by or pursuant to article\nnine, nine-A, twenty-two, thirty, thirty-A, thirty-B or thirty-three of\nthis chapter or article two-E of the general city law, which tax or\nother imposition is administered by the commissioner of taxation and\nfinance, or who or which is under a duty to perform an act under or\npursuant to such tax or imposition, excluding a state agency, a\nmunicipal corporation or a district corporation; and (c) "overpayment"\nshall mean an overpayment which has been requested or determined to be\nrefunded, a refund or a reimbursement, of a tax or other imposition\nimposed by or pursuant to article nine, nine-A, twenty-two, thirty,\nthirty-A, thirty-B or thirty-three of this chapter or article two-E of\nthe general city law, which is administered by the commissioner of\ntaxation and finance.\n (2) The commissioner of taxation and finance, upon agreement with the\nstate comptroller and acting as an agent for the state comptroller,\nshall set forth the procedures for crediting any overpayment by a\ntaxpayer of any tax or other imposition imposed by or authorized to be\nimposed pursuant to article nine, nine-A, twenty-two, thirty, thirty-A,\nthirty-B or thirty-three of this chapter or article two-E of the general\ncity law, which is administered by the commissioner of taxation and\nfinance, and the interest on any such overpayments, against the amount\nof a past-due legally enforceable debt owed by such taxpayer to a state\nagency. An implementation plan shall be developed by the division of the\nbudget and the department of taxation and finance which shall provide,\nbut not be limited to, guidance with respect to coordination of debt\ncollection pursuant to this section and subdivision twenty-seventh of\nsection one hundred seventy-one of this article. This section shall not\nbe deemed to abrogate or limit in any way the powers and authority of\nthe state comptroller to set off debts owed the state against payments\nfrom the state, under the constitution of the state or any other law.\n (3) For purposes of this section a past-due legally enforceable debt\nagainst which an overpayment and interest thereon may be credited shall\ninclude any applicable interest or late payment charge and is a debt:\n (a) as to which the state has (i) obtained a judgment and (ii) given\nsuch notice as is required in subdivision (d) of section five thousand\ntwo hundred twenty-two of the civil practice law and rules; or\n (b) as to which a state agency has (i) made a final administrative\ndetermination where the taxpayer had the opportunity for an adjudicatory\nproceeding to which article three of the state administrative procedure\nact is applicable, or the taxpayer had an opportunity for a proceeding\nwhich substantially complies with the requirements of such article three\nwhere such article three is not applicable, or the taxpayer was afforded\nsuch notice and opportunity to be heard as satisfies due process\nrequirements applicable to such state agency and to such debt, except\nthat if, pursuant to law or regulation, the debt is not collectible\nunless the state agency obtains a judgment, then the debt will not be\nconsidered a past-due legally enforceable debt for purposes of this\nsection until such state agency has obtained a final judgment no longer\nsubject to judicial review and (ii) which cannot be collected by\nadministrative offset by the referring state agency against amounts\npayable to the taxpayer by the referring department; and\n (c) with respect to which the state agency or the department of law\nhas notified the taxpayer in writing, or has made a reasonable attempt\nto so notify the taxpayer at the taxpayer's last address known to such\nstate agency (i) that the debt, which is clearly identified as to amount\nand nature, is past-due and unless paid within thirty days thereafter,\nwould be referred to the department of taxation and finance to be offset\nagainst an overpayment; (ii) that state law permits the offset of\ncertain overpayments against such debts; (iii) that the taxpayer may\nrequest a review of the proposed referral for offset by contacting the\nstate agency at a telephone number or an address disclosed in the\nnotice; and (iv) that the taxpayer may present, to the state agency,\nwritten evidence and arguments in support of his defense to the proposed\nreferral or may appear at a scheduled conference with the state agency\nto present oral arguments and written and oral evidence in support of\nsuch defense; provided, however, that nothing herein shall be deemed to\nafford the taxpayer the opportunity to reargue any issue which was, or\ncould have been, adjudicated in the proceeding described in paragraph\n(a) or (b) of this subdivision; and\n (d) which the state agency which is the creditor or the department of\nlaw, as the case may be, certifies to the commissioner of taxation and\nfinance is past-due and legally enforceable.\n (4) The procedures set forth by the commissioner of taxation and\nfinance for crediting any overpayments, and the interest on any such\noverpayments, against a past-due legally enforceable debt pursuant to\nthis section shall include but shall not be limited to:\n (a) the procedure under which the creditor state agency shall notify\nthe commissioner of taxation and finance of a past-due legally\nenforceable debt due from a taxpayer, specifying when the department\nwill be notified, the information to be contained in such notification\nand the form and format to be used for such notification;\n (b) the minimum amount of a past-due legally enforceable debt against\nwhich the commissioner of taxation and finance shall credit an\noverpayment of tax;\n (c) a provision providing that information furnished to the\ncommissioner of taxation and finance and the comptroller pursuant to\nsuch procedures shall be considered confidential and shall not be\ndisclosed, except as otherwise allowed in this chapter;\n (d) a provision providing that information furnished by the\ncommissioner of taxation and finance pursuant to such procedures shall\nbe considered confidential and shall not be disclosed, except the amount\nof the overpayment and interest thereon which has been credited may be\ndisclosed to the taxpayer, and the amount so credited and the\ninformation necessary to properly identify the taxpayer may be disclosed\nto the creditor state agency; and\n (e) the procedure for reimbursement of the comptroller by the revenue\narrearage account, pursuant to section ninety-one-a of the state finance\nlaw, for any overpayment and interest thereon which has been credited\nagainst the past-due legally enforceable debt owed by a taxpayer filing\na joint return, but which has been refunded by the comptroller, pursuant\nto paragraph six of subsection (b) of section six hundred fifty-one of\nthis chapter, to a spouse not liable for the amount of a past-due\nlegally enforceable debt owed by such taxpayer.\n (5)(a) In calculating the amount of an overpayment and interest\nthereon which shall be credited against the amount of a past-due legally\nenforceable debt owed by a taxpayer which is certified to the department\nof taxation and finance for collection pursuant to this section, the\ndepartment of taxation and finance shall first credit the overpayment\nand interest thereon against any:\n (i) liability of such taxpayer in respect of any tax or other\nimposition imposed by this chapter and administered by the commissioner\nof taxation and finance;\n (ii) liability of such taxpayer for any tax or other imposition\nimposed pursuant to the authority of this chapter or any other law if\nsuch tax is administered by the commissioner of taxation and finance;\n (iii) estimated tax for the succeeding taxable year if such taxpayer\nclaims such overpayment or a portion thereof as a credit against\nestimated tax for such succeeding taxable year pursuant to subsection\n(e) of section six hundred eighty-six or subsection (b) of section one\nthousand eighty-six of this chapter or subdivision (e) of section\n11-1786 of the administrative code of the city of New York or for any\ntax imposed pursuant to the authority of this chapter or any other law\nif such tax is administered by the commissioner of taxation and finance;\n (iv) past-due support owed by the taxpayer pursuant to section one\nhundred seventy-one-c of this article;\n (v) unreimbursed medical assistance paid on behalf of a child payable\npursuant to section three hundred sixty-seven-a of the social services\nlaw;\n (vi) the amount of a default in repayment of a state university or\ncity university loan pursuant to section one hundred seventy-one-e of\nthis article.\n (b) Only the balance remaining, after the overpayment and the interest\nthereon has been credited as described in paragraph (a) of this\nsubdivision, shall be certified to the comptroller as an overpayment\nplus any interest to be credited, in accordance with paragraph (g) of\nsubdivision three of section one hundred seventy-one-l of this article,\nagainst a past-due legally enforceable debt that has been certified to\nthe commissioner of taxation and finance for collection pursuant to this\nsection, and/or a city of New York tax warrant judgment debt that has\nbeen certified to the commissioner of taxation and finance for\ncollection pursuant to section one hundred seventy-one-l of this\narticle, with the remainder to be refunded to the taxpayer if such\nremainder is not required to satisfy the amount of a default in\nrepayment of a guaranteed student loan pursuant to section one hundred\nseventy-one-d of this article. If a taxpayer owes past-due legally\nenforceable debt that has been certified to the commissioner of taxation\nand finance for collection pursuant to this section and city of New York\ntax warrant judgment debt that has been certified to the commissioner of\ntaxation and finance for collection pursuant to section one hundred\nseventy-one-l of this article, then the overpayment and interest thereon\nshall be credited against the debts in the order in which the debts\naccrued.\n (b-1) No taxpayer who has applied for, and is eligible for, an earned\nincome tax credit under subsection (d) of section six hundred six of\nthis chapter shall have more than ten percent of any tax overpayment\ncredited against a past due legally enforceable debt owed to the office\nof temporary and disability assistance for an overpayment of public\nassistance unless such debt was incurred as a result of false or\nmisleading statements or other grounds set forth in section one hundred\nforty-five-c of the social services law, which led to a sanction under\nsuch section.\n (c) If a taxpayer owes more than one past-due legally enforceable debt\nwhich is certified to the commissioner of taxation and finance for\ncollection pursuant to this section, the overpayment and interest\nthereon shall be credited against the debts in the order in which the\ndebts accrued. A debt shall be considered to have accrued at the time at\nwhich the debt became past-due.\n (6) The commissioner shall (a) certify to the comptroller the amount\nof each overpayment and the interest on such amount to be credited\nagainst each past-due legally enforceable debt pursuant to this section,\nthe total amount of each such overpayment and the interest on each such\noverpayment, and the balance, if any, of each such overpayment and\ninterest thereon to be refunded to the taxpayer, and (b) shall certify\nto the comptroller, with regard to each such past due legally\nenforceable debt, the amount of liability underlying such debt which is\ncreditable to unemployment insurance tax, federal funds, federal trust\nfunds or fiduciary funds, or to the office of temporary and disability\nassistance or a local social services district relating to overpayment\nof grants and allowances of public assistance or to the department of\nhealth relating to overpayments of medical assistance made to\nindividuals who are or have been enrolled as providers in the New York\nstate medical assistance program as established under title eleven of\narticle five of the social services law.\n (7) The commissioner of taxation and finance shall notify each\ntaxpayer who makes an overpayment, in writing, of the amount of such\noverpayment and the interest thereon certified to the comptroller as an\namount to be credited against a past-due legally enforceable debt which\nhas been certified to the commissioner of taxation and finance pursuant\nto this section and of the name of the state agency which certified the\namount to the commissioner of taxation and finance. Such notice shall\ninclude notification to any other person who may have filed a joint\nreturn with the taxpayer of the steps such other person may take in\norder to secure his or her proper share of the refund.\n (8) From the time the commissioner of taxation and finance is notified\nby a creditor state agency of a past-due legally enforceable debt due\nfrom a taxpayer, the commissioner of taxation and finance shall be\nrelieved from all liability to such taxpayer or its assigns, successors,\nheirs or representatives for the amount of an overpayment and interest\non such amount certified to the comptroller, to be credited against the\namount of a past-due legally enforceable debt to be collected pursuant\nto this section, and such taxpayer shall have no right to commence a\ncourt action or proceeding or to any other legal recourse against the\ncommissioner of taxation and finance to recover such overpayment or any\ninterest thereon certified to the comptroller to be credited against the\namount of a past-due legally enforceable debt. Provided, however,\nnothing herein shall be construed to preclude any legal, equitable, or\nadministrative action by such taxpayer against the certifying state\nagency to which the amount of overpayment and any interest thereon was\ncredited, with reference to the amount thereof which is greater than the\namount of such past-due legally enforceable debt owed by such taxpayer\non the date of such certification.\n