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Department of Taxation and Finance

2010 Rule reviews

Pursuant to section 207 of the State Administrative Procedure Act (SAPA) the Department of Taxation and Finance must review all rules, with certain exceptions, adopted on or after January 1, 1997, after five years, and, thereafter, at five year intervals.  In 2010, the Department must review rules that were adopted during 2005 and 2000 to determine whether these rules should be retained as written or modified.  Accordingly, the Department intends to review the following rules during 2010, and invites written comments on the continuation or modification of these rules in order to assist the Department in the required review.  We will consider comments that are received by February 22, 2010. Any questions concerning the items listed in this rule review or comments regarding the continuation of the rules being reviewed should be referred to: Office of Counsel, Department of Taxation and Finance, W.A. Harriman Campus, Building 9, Room 200, Albany, New York 12227. Telephone: (518) 530-4153, Email address: tax.regulations@tax.ny.gov.

Agenda items

20 NYCRR Sections 75.1(f) (Agent's cigarette tax returns) and 75.5(a)(1) (Records to be kept by agents and others)

20 NYCRR Sections 75.1(f) (Agent's cigarette tax returns) and 75.5(a)(1) (Records to be kept by agents and others). Filed November 12, 1999; published December 1, 1999; effective November 12, 1999 (emergency adoption). Filed January 20, 2000; published/effective February 9, 2000 (permanent adoption). Need: This rule implemented requirements imposed upon the Department of Taxation and Finance by provisions of the Tobacco Escrow Funds Act (Public Health Law, Article 13-G), which are necessary for New York State to meet certain obligations pursuant to the "Master Settlement Agreement" (entered into on November 23, 1998, by leading United States tobacco product manufacturers and forty-six states, including New York), to ensure that New York receives its apportioned amount of certain payments made pursuant to the Agreement by the tobacco product manufacturers participating in the Agreement. The Act required the Department to promulgate regulations necessary to ascertain the amounts of State excise taxes paid on the cigarettes sold within the State of tobacco product manufacturers each year. This rule was previously reviewed as part of the Department's 2005 Rule Review published in the State Register on January 5, 2005. As a result of that review of the 2000 rule, a Rule Review notice indicating that it would be continued without modification was published in the State Register on August 3, 2005. Legal Basis: Tax Law sections 171, subd. First; 475 (not subdivided); Public Health Law, section 1399-oo, subd. (10); and L. 1999, ch. 536. (TAF-48-99-00001-A)

20 NYCRR Section 201.1 (Income verification)

20 NYCRR Section 201.1 (Income verification). Filed January 20, 2000; published/effective February 9, 2000. Need: This rule provided authorization for the Department to provide the Division of Housing and Community Renewal with information as to whether the income of tenants residing in housing accommodations subject to rent regulation exceeded a statutory threshold for each of the immediately preceding two calendar years, rather than the previously authorized cumulative information for both such years. The rule also reflected the statutory reduction in the income threshold from $250,000 to 175,000. This rule was previously reviewed as part of the Department's 2005 Rule Review published in the State Register on January 5, 2005. As a result of that review of the 2000 rule, a Rule Review notice indicating that it would be continued without modification was published in the State Register on February 8, 2006. Legal Basis: Tax Law sections 171 subd. First and 171-b(3)(a); Chapter 116, Laws of 1997. (TAF-48-99-00022-A)

20 NYCRR Parts 70, 74, 79, 80 and 82 (New York Health Care Reform Act of 2000)

20 NYCRR Parts 70, 74, 79, 80 and 82 (New York Health Care Reform Act of 2000). Filed February 29, 2000; published March 15, 2000; effective February 29, 2000 (emergency adoption).  Filed May 3, 2000; published/effective May 24, 2000 (permanent adoption).  Need: This rule was amended to reflect the statutory increase in the rate of New York State cigarette excise tax that was effective on March 1, 2000; to provide for commissions allowable to cigarette tax agents based upon the face value of cigarette tax stamps as of March 1, 2000; to effectuate the floor tax on cigarettes and unaffixed stamps in inventory as of the close of business on February 29, 2000; to reflect statutory changes to an agent's presumed cost of doing business; to reflect such changes in the various regulatory illustrations outlining the minimum prices at which cigarettes may be sold; and to more realistically reflect the basic cost of cigarettes in the cigarette marketing standards illustrations.  (It is noted that portions of the subject rules were subsequently amended based on Chapters 1 and 93 of the Laws of 2002, affecting both the New York State [TAF-13-02-00010-A] and the New York City [TAF-37-02-00005-A] rates of tax, and Chapter 57 of the Laws of 2008, Part RR-1, affecting the New York State rate of tax [TAF-24-08-00006-A] respectively.)  This rule was previously reviewed as part of the Department's 2005 Rule Review published in the State Register on January 5, 2005.  As a result of that review of the 2000 rule, a Rule Review notice indicating that it would be continued without modification was published in the State Register on July 6, 2005.  Legal Basis: Tax Law sections 171, subd. First; 475 (not subdivided); and L. 1999, ch. 1. (TAF-11-00-00007-A)

20 NYCRR Section 541.7 (Trash and debris removal)

20 NYCRR Section 541.7 (Trash and debris removal).  Filed June 12, 2000; published June 28, 2000; effective September 1, 2000. Need: This rule was amended to authorize a contractor to purchase a trash and debris removal service exempt from sales tax as a purchase for resale when the service is an integral part of maintaining, servicing, or repairing real property by the contractor and includes conditions under which the service qualifies for the exemption.  The rule also clarifies that neither the contractor nor the customer is liable for tax when such a service is purchased by the contractor in conjunction with the construction, demolition, or rehabilitation of real property in the performance of a capital improvement.  This rule was previously reviewed as part of the Department's 2005 Rule Review published in the State Register on January 5, 2005.  As a result of that review of the 2000 rule, a Rule Review notice indicating that it would be continued without modification was published in the State Register on July 6, 2005.  Legal Basis: Tax Law sections 171, subd. First; 1142(1) and (8); and 1250 (not subdivided). (TAF‑16‑00-00002-A)

NYCRR Section 4-4.2 (Allocation - Dock Sales)

20 NYCRR Section 4-4.2 (Allocation - Dock Sales).  Filed July 12, 2000; published/effective August 2, 2000. Need: This rule sets forth a destination rule for the allocation of receipts for purposes of determining the business allocation percentage under the business corporation franchise tax where a customer picks up goods from a taxpayer's place of business (dock sales).  This rule was previously reviewed as part of the Department's 2005 Rule Review published in the State Register on January 5, 2005.  As a result of that review of the 2000 rule, a Rule Review notice indicating that it would be continued without modification was published in the State Register on June 29, 2005.  Legal Basis: Tax Law, sections 171, subd. First; 210(3)(a)(2); and 1096(a). (TAF-21-00-00001-A)

20 NYCRR Section 60.1 (Returns and payments of tax on alcoholic beverages)

20 NYCRR Section 60.1 (Returns and payments of tax on alcoholic beverages). Filed September 20, 2000; published October 11, 2000; effective for calendar years that began on and after January 1, 2001.  Need: This rule allowed certain distributors that are micro‑brewers or restaurant‑brewers to file annual, rather than monthly, alcoholic beverage tax returns.  This rule was previously reviewed as part of the Department's 2005 Rule Review published in the State Register on January 5, 2005.  As a result of that review of the 2000 rule, a Rule Review notice indicating that it would be continued without modification was published in the State Register on September 7, 2005.  Legal Basis: Tax Law sections 171, subd. First; 429(1); and 436 (not subdivided). (TAF-31-00-00002-A)

20 NYCRR Section 158.12 (Paid preparer ID number)

20 NYCRR Section 158.12 (Paid preparer ID number). Filed October 25, 2000; published/effective November 15, 2000.  Need: This rule reflected the Federal option extended to individual paid preparers to use federally assigned preparer tax identification numbers instead of social security numbers when an individual identifying number of a paid preparer is required on income tax returns that they prepare.  The rule provided that paid preparers may use their Federal identification number, rather than their social security number, when preparing New York State returns.  This rule was previously reviewed as part of the Department's 2005 Rule Review published in the State Register on January 5, 2005.   As a result of that review of the 2000 rule, a Rule Review notice indicating that it would be continued without modification was published in the State Register on February 8, 2006.  Legal Basis: Tax Law sections 171, subd. First, 658(g)(1) and (2), and 697(a). (TAF-36-00-00003-A)

20 NYCRR Sections 534.4(a) and (b) and 534.10 (Refunds and credits for vessel operators engaged in local transit service)

20 NYCRR Sections 534.4(a) and (b) and 534.10 (Refunds and credits for vessel operators engaged in local transit service).  Filed November 29, 2004; published December 15, 2004; effective November 29, 2004 (emergency adoption).  Filed February 7, 2005; published/effective February 23, 2005 (permanent adoption).  Need: This rule made permanent the emergency measure that implemented Part M of Chapter 60 of the Laws of 2004, which provides that certain refunds and credits of sales and compensating use taxes are allowed for vessel operators engaged in local transit service.  Part M required the Commissioner of Taxation and Finance to define the implementing terms "local transit service," "vessel hours," and "total hours operated" by rule.  Legal Basis: Tax Law sections 171, subd. First; 1119(b); 1142(1) and (8); 1250 (not subdivided); and L. 2004, ch.60, Part M. (TAF‑50‑04-00004-A)

20 NYCRR Sections 153.6 and 158.12 (Requirements applicable to tax return preparers)

20 NYCRR Sections 153.6 and 158.12 (Requirements applicable to tax return preparers).  Filed May 24, 2005; published/effective June 8, 2005.  Need: This rule removed the manual signature requirement for tax return preparers from the personal income tax regulations.  Legal Basis: Tax Law sections 171, subd. First, 658(g), and 697(a). (TAF-14-05-00002-A)

20 NYCRR Part 5000 (Compromises under Subdivision Eighteenth-A of Section 171 of the Tax Law) and Part 5005 (Compromises under Subdivision Fifteenth of Section 171 of the Tax Law)

20 NYCRR Part 5000 (Compromises under Subdivision Eighteenth-A of Section 171 of the Tax Law) and Part 5005 (Compromises under Subdivision Fifteenth of Section 171 of the Tax Law).  Filed September 16, 2005; published/effective October 5, 2005.  Need: This rule was amended to reflect existing Department policy and legislative amendments and to make technical corrections concerning offers in compromise.  Legal Basis: Tax Law, sections 171, subdivisions First, Fifteenth, and Eighteenth-A.  (TAF-30-05-00004-A)

20 NYCRR Sections 171.4(b)(1) (Supplemental wages), 251.1(b) (Supplemental wages, City of Yonkers), and 291.1(b) (Supplemental wages, City of New York); Appendixes 10, 10-A, and 10-C

20 NYCRR Sections 171.4(b)(1) (Supplemental wages), 251.1(b) (Supplemental wages, City of Yonkers), and 291.1(b) (Supplemental wages, City of New York); Appendixes 10, 10-A, and 10-C.  Filed November 22, 2005; published/effective December 7, 2005.  Need: This rule repealed Appendixes 10, 10-A, and 10-C to provide new New York State, City of Yonkers, and City of New York withholding tables and other methods applicable to wages and other compensation paid on or after January 1, 2006.  The amendments reflected the return to tax tables used in 2002 for New York State and the City of New York based on the lapse of revisions of the tax tables and tax table benefit recapture provided in Chapters 62 and 63 of the Laws of 2003, and the postponement of the expiration of City of New York provisions by Chapter 636 of the Laws of 2005.  The new tables and other methods for the City of Yonkers also reflected amendments to City of Yonkers local laws increasing the amount of its income tax surcharge and its rate of earnings tax on nonresidents.  The rule also reflected the decreases in the New York State and City of New York supplemental withholding rates applied to supplemental payments and the increase in such rate for the City of Yonkers.  Legal Basis: Tax Law sections 171, subd. First, 671(a)(1), 697(a), 1309, 1312(a), 1329(a), 1332(a); and Model Local Law, section 7, found in section 1340(c); Codes and Ordinances of the City of Yonkers, sections 15-105; 15-108(a); 15-121; and 15-130; Administrative Code of the City of New York, sections 11-1771(a); 11-1909; and 11-1943. (TAF-40-05-00024-A)

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