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United States: New York's Delinquent Taxpayers To Lose Driving Licenses

Monday, 26 August 2013   (0 Comments)
Posted by: Author: Leroy Baker
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Author: Leroy Baker

The New York State Department of Taxation and Finance has introduced a program in which a driver's license in the State can be suspended when a taxpayer's past-due tax liability exceeds USD10,000.

As a part of the State's Budget this year, and under an initiative to encourage individuals who owe significant back taxes to pay their bills, it is estimated that the new policy will increase State collections by USD26m this fiscal year and as much as USD6m annually thereafter.

"Our message is simple: tax scofflaws who don't abide by the same rules as everyone else are not entitled to the same privileges as everyone else," Governor Andrew Cuomo said. "By enacting these additional consequences, we're providing additional incentives for the state to receive the money it is owed and we’re keeping scofflaws off the very roads they refuse to pay their fair share to maintain."

"It's in every taxpayer's best interest to pay all tax bills in full," said Commissioner of Taxation and Finance Thomas H. Mattox. "If you can't pay in full, our staff is available to help you arrange a payment plan that will satisfy your debt."

The Tax Department is sending the first round of 16,000 suspension notices to delinquent taxpayers, who have 60 days from the mailing date to arrange payment with the Department. If the taxpayer fails to do so, the Department of Motor Vehicles will send a second letter providing an additional 15 days to respond. If the delinquent taxpayer again fails to arrange payment, the license is suspended until the debt is paid or a payment plan is established.

However, taxpayers holding a commercial driver's license, and taxpayers making certain child support payments or combined child and spousal support payments, will be excluded from the program, as will those seeking relief from joint and several liability under innocent spouse relief.

A taxpayer who drives while the suspension is in effect is subject to arrest and penalties. Those with a suspended license can, however, apply for a restricted license, that allows them to drive to work, and return directly home.

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Section 240A of the Tax Administration Act, 2011 (as amended) requires that all tax practitioners register with a recognized controlling body before 1 July 2013. It is a criminal offense to not register with both a recognized controlling body and SARS.

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