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Options for New York State Back taxes

New York State has a framework for tax resolution for the taxpayers who are managing their back taxes. The New York State Department of Taxation and Finance has a good name for being constant and dependable. Some tax programs help taxpayers in paying off their tax balances over time. Many other options are available that assist the financially impoverished taxpayers to settle down for less than what they owe.

If you are struggling because of back taxes in New York State, then the following overview will offer you with some necessary direction on the options of resolutions. Then you will also get guidance on what will happen when you do not pay your NY state taxes. It's also important to remember that programs and laws always change, so it’s a good idea to stay associated with a good tax professional.

Various Options for NY State Individual

You can pay off your taxes either online, through mail or over the phone and also in person. Here in this guide, you can learn how to pay NY state taxes covers various options and the deadlines for paying off the state tax payments.

NY Installment Payment Agreement or IPA

Department of Taxation and Finance provides various kinds of payment agreements for those who are not able to pay their tax in full amount. They will check the compliance history of the taxpayer, existing financial condition and how much they are adhering to the requirements of the department for determining whether or not to accept IPA. Keep in mind that you will have to pay off your tax in a series of monthly payments but penalties and interests will still accumulate. New York allows up to 72 months to a taxpayer for paying off their tax balances normally with a direct debit instalment agreement.

Options for New York State Tax Payment

New York State’s Department of Tax and Finance Provides plans for tax payments for taxpayers who are not able to pay their NY state taxes in full. This option of the NYS tax payment plan varies based on the terms and also the capability of the taxpayer to disclose the financial data. However, these options also assist taxpayers who are not being able to afford to make payment of their taxes in full amount. Setting up a plan of payment can assist you in avoiding wage garnishments, tax liens, license suspension of the driver and other such actions of collections from the DTF.

Installment Payment Agreement or IPA is an official name that DTF make use of for referring to a monthly tax payment plan. The previous name for IPA was “Deferred Payment Agreement”.

DTF does not do discussions publicly about the typical term for the plan of payment. In general, the longer the requested term by the taxpayer, the review process of the IPA will be more meticulous. Some of those options might have changed for which it is good to check with a licensed tax professional whenever in doubt. But, as of August 2017, the following information will offer you a breakdown of the kind of payment plans that are available for the individuals.

Some of these options may have changed.  It is always best to consult with a licensed tax professional when in doubt. However, as of the year August 2017, here is a breakdown of the type of payment plans available for the indivisuals.

Streamlined NYS tax payment plan for three years

In general, the New York State provides a 36-month payment plan for taxes with personal income owed by a taxpayer without needing financial disclosure. In simple words, the whole application procedure does not need financial disclosure. If you are given IPA, you can pay off your tax liabilities within three years or before the expiry of the collection Statute Expiration Date, whatever comes first.

The CSED is the date by which NY State can’t do collection of tax from you. Thus, an IPA should end before the arrival of the SCED date. You should keep in mind that NY State has a twenty-year order of limits on tax collection.

NYS Tax payment plan for 3 to 6 year

When a taxpayer needs over three years to pay off the tax balance, NYS might make a request for financial data. Thus, in case there is a need for financial verification, a DT–5 form or financial data should be submitted.

In many cases, NYS might do filing of a tax warrant with the County Clerk and the Secretary of State. As a result of this, the tax warrant forms a tax lien. Thus, it’s a good idea to ask if DTF can abstain from the issuance of a tax warrant until you remain in compliance with your IPA.

Business Installment Payment Agreements

Businesses can get IPAs but the needs vary on a case by case basis. This is mainly determined by the type and the amount of taxes that are due. In several cases, the DTF needs a 20% down payment. But there are several cases where IPA has been granted without the need for a down payment. An IPA can be for any business with a liability of trust fund. As a result, form DTF-5 might be needed by all good officers of the business. They are required to fill it out personally.

Sole-proprietors, the members of the multi-member LLCs and single-member LLCs, generally accumulate the income at the personal level. Thus, the discrete options presented above would be applied.

Process for applying for an IPA

There are some ways to apply for a payment plan with the DTF of NYS. You can get associated with a licensed tax professional having NYS tax resolution experience. You can request it and there is no obligation. If you are having your bill, then you can call at 518 – 457 -5434 to the NYS department. You have to make an entry of the taxpayer identification number and the four-digit PIN present on your bill.

You can opt for an online application after you have set up your account. After logging in, choose Payments, then Bills and Notices and then “Request an Installment Payment Agreement”. This process works if the amount you owe is $20,000 or less.

As part of the application process of the IPA, taxpayers can request a term and/or specified monthly payment amount. In the time DTF is doing a review of an IPA request, DTF can ask the taxpayers to make some good faith payments. Generally, those payments match closely the monthly payment amount which the taxpayer asks for along with the IPA.

DTF will also have a close look at the compliance history of the taxpayer and the financial status while deciding on granting an IPA request. When the DTF decides to grant OPA, the taxpayer has to stay in compliance with all kinds of tax filings and make payment of the all-new tax balance in complete amount. Failing to stay in compliance will default the IPA automatically. In case, you default, the state will allow you to set up a new plan of payment, but there is no guarantee. When you default on two plans of payment in a year, the state has the right to take away your driver's license.

When the taxpayer fails to make the minimum requirement of monthly payment through the Installment Payment Agreement, they might not consider other available options which also include an Offer In compromise.

When can NYS DTF terminate an IPA?

DTF can terminate an IPA anytime if in case it finds that the taxes owed under the IPA are in danger of being collected. In general, if DTF wants to cancel or do modification of an IPA, it should offer the taxpayer a 30 days’ notice. It can do termination or modification of the IPA if in case:

•           The taxpayer has given improper or incomplete data before making an entry to the IPA

•           The financial state of the taxpayers has changed

•           You have failed to make any payment or make payment of any other tax balance whenever due

•           You are unable to offer the updated financial data as requested by the DTF

12 months currently not collectable status

When you do not have eligibility for an IPA, you are eligible to apply for a hardship status which is good for one year. You will have to complete a financial form and a disclosure of financial data yearly. The disabled or retired, hugely benefit from those options because they do not expect their financial situation to change in the coming days. But a tax lien or the tax warrant usually gets filed.

It can be compared with getting a CNC status from the IRS. But not like the IRS, the DTF does not do public discussion about this option and there are no formal processes. But it is available for those taxpayers who are going through some difficult situations. Like for example, illness, family problems, floods or fire and declined income.

When you fail to make payment of your New York tax bill, it results in several kinds of unrequired consequences which also include wage garnishments and seizure of assets. But before the state takes such actions, there is a high chance of the issuance of a tax warrant and the taking away of your driver's license.

New York Tax Law section 171 – v offers the DTF or the Department of Tax and Finance, the right to take away your license. The state depends highly on this program as it is highly efficient in making people make the payment. In between the years 2013 and 2017, the New York state had collected an amount of $738 million in unpaid taxes with the help of this program. That is about $185 million per year.

Are you behind on your state taxes? Are you getting worried that you might lose your license? You will be happy to know that there are some ways to stop this from happening. To get the right assistance, get a tax professional who is based out of New York. They can assist you in dealing with the New York State DTF and get you back on track.

New York State Taxes can cause suspension of a Driver’s License

If the owing amount is more than $10,000 in your unpaid taxes, the state keeps the right to cancel your driver's license. The state can also take your license or suspend it when you default on a payment arrangement multiple times in 12 months.

Losing a license can hurt anybody, but it is very difficult for those people who reside in car-based parts of New York State. Without a driver's license, it is not possible to get work, transport your children or take care of other kinds of necessities.

How you can challenge your license suspension in New York State?

When the state provides you notification about the suspension of your license, you can challenge the state’s decision of any of the following things applied:

• The suspension was given wrongly to a taxpayer
• You have already made payment of your owed taxes
• Your wages are being garnished for the owed taxes
• Your wages are getting garnished for the owed child support or maintenance of your spouse
• You are doing payment of court-ordered child support or spouse maintenance
• You have a commercial driver's license
• You got public help or extra security income
• You can prove that suspension of your license can cause you economic hardship
• You are asking for innocent spouse relief on an owed tax bill
• You have filed for bankruptcy and the court has issued a stay order.

To challenge your driver’s license suspension, you are required to connect with the DTF before they suspend your driver's license. Generally, the Department will send a minimum of two notices along with instructions on how to give a response before they take away your license. If your license is already suspended and you are not sure how to go about challenging the suspension, then you can seek assistance from a New York Tax professional.

Restricted License

Depending on the situation, you may be able to get a limited suspension. With a restricted driver's license, you can drive to and from work, school, medical appointments, and the DMV. You can also drive your children to a childcare provider who watches them while you are at work or school.

If you don't qualify to challenge the suspension, you should request a restricted license. Then, you will at least have the right to drive for essential needs. However, whenever possible, you should attempt to make payment arrangements before the state takes your license.

What to Expect If the State Suspends Your Driver's License?

In most cases, you will receive several notices about the unpaid taxes before the state escalates to a driver's license suspension. If the DTF decides to go after your license, they will send a Notice of Proposed Driver's License Suspension. This notice gives you 60 days to resolve your tax liability, and if you don't make arrangements during that time, the DTF will contact the Department of Motor Vehicles.

Then, the Department of Motor Vehicles will send you an Order of Suspension or Revocation Notice to resolve your tax debt by a 15-day deadline. If you don't pay your taxes, challenge the suspension, or make other arrangements, the state will move forward with the suspension, and you will lose your driving privileges. If you drive with a suspended license, you risk getting arrested and facing charges.

How you can avoid losing your driver’s license?

Preferably, you will never want to be in a situation where you will have to challenge the suspension of your driver’s license. Rather, you will want to escape this situation. To do that, you should contact the DTF before they send notices to take away your license. When you are not able to pay off your taxes, you might feel that ignoring the situation is the best solution. Many people ignore notices that they receive from the state revenue department or the IRS as they do not want to think about the issue. Owing tax can be highly stressful but for the protection of your finances, you have to face the issue head-on.

If you want to avoid suspension of your license, you need to contact the DTF or you can with a tax professional to make one of the below-written arrangements about your tax liability:

• Payment in full: One of the most efficient ways to avoid the state’s collection action is by making full payment. To decrease the problems associated with unpaid taxes, you can make use of a credit card or a loan to make the payment. You should keep in mind that penalties and interest are accumulated on every unpaid tax, so that you can come out ahead by arranging money for paying off your bill.
• Monthly payment plan: Do make payments monthly until you have paid off your debt in full amount. The state allows both businesses and individuals to make some monthly payment plans.
• Innocent spouse relief: In New York state, you might be able to become eligible for relief when your tax debt is due because of any unreported income or mistakenly claimed deductions that your spouse has taken without your knowledge. If you are eligible, the state offers you relief from their bill position. There is a same program to assist with offending IRS taxes.
• Offer in compromise: When in truth you cannot pay off your taxes, even by selling off your assets or putting all your disposable income towards the bill, the New York State might allow you to settle down for a moment less than what you awe. Being eligible for an offer is very difficult, but in some situations, this program can become invaluable.
• Establishment of economic hardship: The state makes all attempts to get your taxes paid. It does not have any intention to harm the citizens. If you have authentic economic hardship owed because of license suspension, contact the state as quickly as possible after you receive the notices that give you a warning about the driver's license suspension.

How you can get your driver's license back once suspended?

What will happen if you lose your driver's license because of owed taxes? First, ensure you do not drive because if you are caught while driving, it leads to legal charges and penalties. This in turn will make the whole situation even worse.

So, you need to take the following few actions as quickly as possible:

Make a payment of your tax in full: If you get any way to pay your owed taxes in full, that is one of the most efficient ways to put the state tax debt off.

Request monthly payment plans: If you are eligible for monthly payment plans, then the DTF will recommend putting the driver's license suspension on hold. After making your payments, the state lifts off the suspension. Again if you fail to make payment as promised, the DTF will start the suspension.

Hardship status: There are many ways by which you will be eligible for lifting off your suspension because of hardship. Connect with the DTF directly or you can contact any skilled tax professionals for assistance.

How you can check the status of NY driving privileges?

If you have recently moved to the state or you have not opened your mail, you might have lost your driving license without even realizing that. So, how you can check? You can check the New York DMV website. Scroll down through the page till you see “check license/driving privilege status” under the category “Other License options”. Then you can click on that link and follow all the prompts for checking the license status.

Offer in Compromise:  It is the same as the offer in compromise of the IRS. NYS is more selective when the matter is about who is eligible. It is available for those individuals and businesses that are insolvent or got discharged in bankruptcy processes. It is also for those individuals who are solvent, but payment creates “undue economic hardship” With an NY OIC, taxpayers make an offer that is the same as the equity in their assets and the future disposable income.

Innocent spouse relief: NYS offers Innocent spouse relief as one of the options for spouses or former spouses who file for joint tax returns. There are three different kinds of options under this category:

Innocent spouse relief

Liability separation

Equitable relief

In general, innocent spouse relief is best for those spouses or former spouses who do not know and have no reason to know about joint tax returns which they signed for an omission or any error. Moreover, the spouse also believes that DTF must not hold him or she is responsible for the tax understatement.

Options for NY business tax

In New York State, holding tax and sales taxes are trust fund taxes. Businesses do collection of the former tax for the consumers or the employees and make submission of them to the state. Thus, the unpaid trust fund taxes are a serious matter to the New York State. In general, these tax cases are managed on a case-by-case basis. Following are some of the pathways that are frequented by the businesses that owe taxes:

Installment payment agreement: In maximum cases, the New York State needs a down payment of about 20% before agreeing to IPA. But DTF might still give grants to IPAs without any down payment.

Offer in compromise: As discussed before, businesses that are not solvent or bankrupt can apply for the OIC program. NYS generally does not approve an offer for an amount that is less than the amount of trust fund taxes. But you can make an offer for the principal amount that excludes penalties and interests. However the income taxes are different, so for businesses that are still active, an IPA with a down payment is one of the best options. But, if NYS assessed a “responsible person” personally for the owed business taxes, then that individual might apply for the OIC program if anyone qualifies.

Voluntary disclosure program: The New York Department of Taxation and Finance provides a voluntary disclosure and compliance program. This is the same as a permanent tax amnesty program for those people who owe taxes. If you woe NY state some back taxes and have returns that are not filed, the voluntary disclosure program facilitates you to catch up without any penalties or any kind of criminal charges.

To apply, you need to talk with the department and make an outline of which taxes you owe. Then you have to make payment of all the taxes and then agree to pay off all future taxes. You can apply for a voluntary disclosure program online or you can contact a tax professional to assist you. When you have hidden investments in any passive foreign investment company, you can initiate the voluntary disclosure application but do not make any submission of returns right away. Rather, wait for the New York DTF to contact you.

New York State Tax audits

A New York State audit is one of the most stressful processes. The NY DTF might choose you for an audit when you have any unfiled returns, income that is not reported, excess of credits or any exclusions or fraud returns. New York State also performs several residency audits. The state also makes a comparison of data from the IRS, and in case there are any discrepancies, it might choose you for an audit.

At the time of the audit, you will have to prove the data on your returns. You might also have to make arguments with the audit examiner if they make claims that your return should be different. When you are not careful, audits result in some unexpected tax liabilities. A tax professional can be invaluable when you are being audited.

New York State of Limitation for collection of tax

New York or the DTF has about 20 years for collection of tax liabilities. It is about 20 years from the date that the DTF can file a warrant. While the IRS has about ten years for legal collection of the taxes, NY State has about 20 years.

The first date a warrant can be filed varies based on the situations such as:

• If there is no right to hear about the payment demand, the day is after the payment demands letter specifications.
• If there is any right to a hearing, it is counted as the first-day post-deadline for requesting a hearing.
• Keep in mind that NY state and the taxpayer can both agree to extend the time for collecting the tax warrant.

Actions for New York State Debt Collection

As mentioned above, the New York State has about 20 years for collection of tax debt. You cannot hide from the state till the mentioned timeframe expires. It is very long. One of the best options is contacting a tax professional and setting up tax resolution plans for dealing with back tax matters. But what will happen when you do not? What will happen when you do not pay off your NY state taxes?

Overview of how DTF collect your back taxes

New York state tax warrant

A New York State Tax Warrant is a kind of tax lien against your personal property or real property. It offers the state the right to seize your property and doing garnishment of your wages. Even though the state does not move forward with the seizure, the tax warrant can have an impact on your capability for buying and selling property and taking out loans.

When you sell off property when there is still a tax warrant, the state keeps the right to the sale proceedings, up to an amount of your tax bill in addition to penalties, collection costs and also the interests. Once the warrant is in its place, it becomes difficult or even impossible to remove unless you have made payment of your state tax bill in full amount. One of the best options is to make arrangements for your state taxes before the issuance of the tax warrant by the NY DTF.

Tax levies in the New York State

A levy is the next step of a tax warrant. A tax levy is something when New York State DTF seizes your bank accounts. The state contacts your bank and sends them a warning of 90 days. If you fail to pay off your tax liability, the bank sends the funds available in your account to the state after the completion of the warning period.

In New York, the state makes use of the term “tax levy” to refer to bank account levies. When the state seizes your physical assets, it refers to the whole process as a seizure. When it seizes the wages, it makes use of the phrase income execution.

Income executions

It is something when the DTF wants to pay a part of your wage towards the state tax bill. At first, the state also asks for making a payment of 10% of your gross wages or 25% of the disposable wages each time you get paid. When you do not adhere to it, the department sends an income execution order to your employer. Then your employer holds on to this amount from the paycheck and sends it to the state each pay period. It is called wage garnishments in other states.

Seize

After New York state files for a tax warrant, it might seize all your assets and sell them at any auction. The state can also take the personal and business assets. While taking the business assets, the department can alter the locks at your business place, not give access and take control of all of your business assets as well as merchandise.

Suspension of NY Driver's license

If the amount you owe is over $10,000 in NY state back taxes, then DTF can do suspension of your driver’s license. The department first sends you a notice of the proposed driver's license suspension. You can prevent the suspension by making payment of your tax in full or you can set up an installment plan. When you have a commercial driver's license, you might get exempted from this action of collection. You will also get an exemption when your wages are garnished for taxes, you make payment of court-ordered child support, you are on public help or you have received a supplemental security income.

New York state back taxes private debt collection

When you have unpaid taxes, the New York State can send your file to any of the private debt collection companies. The DTF sends you a letter DTF 975.1 to warn you that your account has been referred for private collections.

How to know if the collection agency functions for the New York State? Well, you can ask them for the case ID number to confirm that they are authentic. You can also contact the DTF for checking. As of the year 2022, the New York state tax department makes use of Coast Professional, Inc. in West Monroe, Louisiana for the collection of back taxes.

Tax refund offsets

You didn’t get your NY tax refund? When you have back taxes, the state holds your tax refund amount. New York DTF also holds on to your state tax refund for covering your IRS debts and debts from various other agencies. This is known as the tax refund offset program. Usually, you cannot get back your tax refund offsets. But if you had filed joint returns and the refund got seized because of the due bill amount, especially to your spouse, you can apply for non-obligated spouse relief. To apply you need to file form IT – 280 which is a non-obligated spouse allocation.

How you can contact the New York State Department of Taxation?

There are several ways to contact the New York Department of Taxation and Finance. If in case, they do not receive your phone calls, you can contact them by making use of “online services”, which is one of the most efficient ways to reach them. It is very useful whether you are responding to any of their notices, or you want any kind of enquiry.

Contacting through online services: This is one of the fastest ways for making a payment, giving a response to their letter or any notice paying off a bill or communicating with the department. At first, it's important to create an account. It is the best way and is applicable to individuals, tax professionals, businesses and also fiduciaries. Individuals can make use of this for paying their bills, offering responses to bills, responding to notices, changing addresses, getting refund notifications, making estimated tax payments, filing a power of attorney, filing for an offer in compromise and also setting up payment plans. Businesses can file and make payments for their taxes, respond to notices or letters, schedule payments, and do filing for an instalment payment agreement and many more.

Contacting by phone: Taxpayers can also contact the New York Department of Taxation and Finance through phone but sometimes the department may not accept your phone calls. It can be because of the time of the year or the non-availability of resources. If you get a letter or notice, it includes a phone number for calling and a PIN for entering, but there is certainty that you can speak to any person or an agent. You can obtain a list of telephone numbers and operational hours customized as per your specific requirements for the individuals here and businesses as well.

 Fax: Individuals and businesses are mostly offered a fax number on a notice or a letter for responding or offering documentation to any department. But the fax number is specified in any letter or any notice, so you cannot make use of any number which you get online.

How you can make payment of New York State Taxes?

It takes a huge amount of contributions from the taxpayer to keep New York state government agencies up and also running. As per the New York State Department of Taxation and Finance, more than $108.6 billion was accumulated from the state-imposed taxes and fees between the years 2022 and 2023.

 Do you want to make an addition to this year’s number by paying off your tax amount? If yes, then you will most likely want to know more about ways to pay the New York State Taxes online, over the phone, by mail or in person.

Here you can get a brief about the due dates for the state tax payments. Then you can know about all the options you have and how you can do navigation of any kind of issues that come up along your way.

When is your New York State taxes due date?

New York State income tax returns are due each year on April 15 or the next business day, if in case the date falls on a holiday or weekend. You are expected to pay off your tax bill on an immediate basis on the return due date. Even when you request an extension, the payment is due on April 15th. If you are obligated to make estimated tax payments quarterly, your due dates will be April 15, June 15, September 15 and January 15.

Businesses have to face a wide range of due dates for their state tax obligations. For instance, sales tax is due on the 20th when you file monthly, but quarterly and annual filers have different due dates. Quarterly withholding of taxes is due for the month’s last day following the quarter where you have paid the employees. That is April 30, July 31, October 31 and January 31. It takes no time for your taxes and your tax situation to become complex, especially when your life circumstances change or you start with a new business. If you require assistance in determining due dates on your taxes, you can consult a tax professional to know about more details.

How you can make estimated tax payments in New York State?

You can make estimated tax payments in the same way you make other New York state tax payments. You can pay online using your preferred bank account or through your credit card. If you want to make payment using a cheque or money order, you can fill out form IT – 2015. Then you can mail this information and your payment to

NYS Estimated Income Tax Processing Center

PO Box 4122

Binghamton, NY 13902

Make sure you have included the tax year and the last four digits of your social security number on your cheque or the money order.

How you can pay off your New York State taxes through online services?

One of the easy ways to pay off your New York State Tax bill is by making use of the Department of Taxation and Finance’s online service system. By making use of the online system, you can pay directly from a bank account or a credit card. To start with, you have to create your account first. You need to choose the kind of account which you want to create. With an individual account, you can see your history, make your payments select how you want to obtain your bills and give responses to notices.

Go to the website and choose to create an account. Then you have to enter your social security number. Include your PIN which you have got from your New York State Tax Department. You have to go through the process of submitting the right information and setting up your account. Once you are done will all settings, you can log in to your account. You can input the data of your bank account into your profile and make your free payment. Or you can make use of a credit or debit card to make payment for a small processing fee.

Can you make payment without account creation?

On the website of NY DTF, you can make rapid payments without account creation. To do so, you will require a case number from your bill or notice and also your social security number, filing status and also the zip code. Once you have all the information, you can go to the Quick Pay site to make your payment.

Through credit card

Another option for making payment is through credit card through the online payment system. You should keep in mind that this kind of payment is available at a cost. The Department has made this arrangement with the service provider of the credit card. Wells Fargo, for devising a payment system that accepts the credit. As of the year 2024, for each payment, there is a convenience fee of 2.20%.

How do you make payment of New York state taxes through mail?

You can also make payment of your New York state Taxes through the mail without paying any extra fees if you do not want to get involved with an electronic system. It is not recommended that you send cash through any mail. Rather, the department will approve mailed-in checks or money orders.

Through money order or cheque

You can make the tax payment through a money order or cheque. At first, write the 10-digit case number that was provided by the New York Department of Taxation and Finance on your money order or cheque. You will also want to write your taxpayer ID number on the cheque or the money order too. Then put your document in an envelope and mail it to the following address:

NYS Assessment Receivables

PO Box 4127

Binghamton NY 13902

How to make payment of your New York State taxes in person?

At present, the New York state prefers you to submit payment electronically, but also you can make payment in person. To pay in person, you have to visit the Department of Finance business centre. Go to the website to know about the list of offices which you can visit and do submission of payment too.

What you can do when you cannot afford your New York state tax bill?

Have you received the New York State Tax bill that you were not expecting or that you cannot pay off in lump sum amount? Then it is vital to get information on your options available right away. The New York State Department of Taxation and Finance expects you to be able to pay off your debt in full amount. Failing to do so can result in penalties, interest, tax warrant, losing license and efforts for future collection. But based on the situation, you might qualify for a monthly payment plan on your taxes, an offer in compromise for settling for an amount which is less than what you owe.

What you can do when you cannot afford your pay your New York state tax monthly payment?

If you have an existing payment plan but you cannot afford to make your monthly payment, you must contact the tax agency as quickly as possible. Your plan of payment is a legal agreement. When you fail to make these payments it can completely negate your plan of payment, especially when you do not get in touch with the tax agency about your incapability of paying. Generally, the agency has more chance to work with you when you inform them rapidly about any kind of payment problems.

How to navigate through fees and penalties?

When you are not on any kind of payment plan and you do not make any timely payments, the NY State DTF will first send you notice about the due balance. When it does not prompt you to make payment of what you owe, the agency applies for fines, penalties and fees against your account. These penalties compound each month for which your unpaid balance increases.

Can you negotiate to reduce your tax debt?

It varies on a case by case basis. The NY DTF does have some of the programs such as an offer in a compromise agreement that allows the taxpayers to decrease their tax debt liabilities. These programs are available for those taxpayers who can prove that they are going through a financially distress condition.

Does NY State DTF forgive tax debt?

In New York State, the tax debt remains valid for about twenty years, which is double the amount of the statute of limitation on IRS tax debt. New York State does not have a straight-out forgiving program, but when you can prove your incapability to make payment, the agency has a high chance of working with you to find a solution.

Outcomes of not making payment of New York State Taxes

When you do not pay off your New York State taxes that are due, you will start having penalties. The penalty for this nonpayment is 0.5% of the unpaid amount each month until the whole balance reaches 25%. You will also gather interest each month. You will also face a tax levy that puts your property and all your assets at risk.