N.Y. Comp. Codes R. & Regs. tit. 20 § 539.5

Current through Register Vol. 46, No. 45, November 2, 2024

Section 539.5 - Bonds and trust accounts

(a)

(1) Whenever the department deems it necessary to protect the revenues due under article 28 of the Tax Law and pursuant to article 29 of the Tax Law, it may require any holder of a certificate of authority who is required to collect tax under article 28 and pursuant to article 29 of the Tax Law to file a bond (issued by a surety company authorized to transact business in this State and approved by the Superintendent of Insurance in this State as to solvency and responsibility) or such other security acceptable to the department, in such amount as may be determined by the department, to secure the payment of any tax, penalties or interest due or which may become due from such person under article 28 and pursuant to article 29 of the Tax Law.

(2) Where a person who holds a certificate of authority has been given notice by the department to file a bond, such person must file such bond or security within 30 days of such notice, unless within five days after the giving of such notice such person shall, in writing, petition for a hearing or request a conciliation conference.

(i) Upon timely application, a hearing or conference will be scheduled in accordance with the procedures described in the Tax Appeals Tribunal Rules of Practice and Procedure (Part 3000 of this Title) or the Division of Taxation's Bureau of Conciliation and Mediation Services Rules of Practice and Procedure (Part 4000 of this Title).

(ii) Where such person timely files for such hearing or conference the department will not pursue any suspension or revocation proceedings based solely upon a failure to file or maintain such bond or security until such time that the matter has been finally adjudicated through the administrative process.

(iii) As provided for by section 539.4 of this Part, the department may suspend or revoke the certificate of authority of any person who fails to post or maintain a bond or any other acceptable security as required by this section.

(b)

(1) The department may require any person who fails to collect, truthfully account for, pay over tax, or file returns of the tax as required under article 28 and pursuant to article 29 of the Tax Law to create an account and deposit such taxes in a banking institution (approved by the Commissioner of Taxation and Finance and located in this State) the deposits in which are insured by any agency of the Federal government.

(2) Such account and deposits thereto shall be in trust for and payable to the Department of Taxation and Finance. The amount of such tax deposited in the account shall not be removed therefrom until payment over to the Department of Taxation and Finance.

(3) The department may require deposit of tax collected or required to be paid or collected to such account monthly, weekly, daily or upon such other basis as it shall determine.

(4) Failure to establish such an account or make such deposits thereto as required, may, as provided for by section 539.4 of this Part, result in the suspension or revocation of such person's certificate of authority.

Cross-reference:For bonds and trust accounts see Tax Law, section 1137(e)(2) and (3) and section 533.4(c) and (d) of this Title.

N.Y. Comp. Codes R. & Regs. Tit. 20 § 539.5