In August 2013, I wrote a blog regarding New York’s new enforcement procedure to collect state back taxes by suspending drivers’ licenses. The link to my blog post is: https://www.irsproblemsolve.com/2013/08/new-york-back-tax-penalty/. Below discusses a recently published case regarding the license suspension program. The case illustrates how simple it is for NY to suspend a driver’s license for the failure to pay back taxes.
In order to suspend a New York drivers license for the failure to pay taxes, Tax Law §171-v [3], requires that the taxpayer owe $10,000 or more of NY back taxes. The statute further requires that NY send notification to the delinquent taxpayer of inclusion into the driver’s license suspension program. Upon receipt of the notification, the delinquent taxpayer is provided with 60 days to respond. The taxpayer’s response is limited to the following:
- Pay the back taxes or establish a payment plan
- Notify the Division of a tax exemption; or
- Protest the suspension by filing a request for a conciliation conference with the Bureau of Conciliation and Mediation Services (BCMS) or a petition with the Division of Tax Appeals.
In a recent published case, CleEsther Carrol, a NY taxpayer, owed $12,434.67 in back income taxes for the 2006 and 2007 tax year. Ms. Carrol filed a petition with the Division of Tax Appeals stating that “[she] was waiting to receive forms from the IRS so that [she] could get her taxes done”. She did not specify any other grounds to challenge the liability.
Under Tax Law §171-v, a taxpayer’s appeal is limited to the following challenges:
- I don’t owe taxes because I’m not the taxpayer to whom the notice refers;
- I paid the tax liability in full;
- My driver’s license is a commercial driver’s license;
- My wages are being garnished for the payment of the past-due tax liabilities or for past-due child support or combined child and spousal support arrears;
- The department incorrectly found that I have failed to comply with the terms of a payment arrangement made with the commissioner more than once within a 12 month period.
The problem with Ms. Carrol’s response is that she didn’t cite any of the above grounds. Accordingly, the Division upheld the suspension of Ms. Carrol’s driver’s license.
The opinions that have been published regarding New York’s Driver’s Suspension program have displayed how easy it is for the Division to suspend a driver’s license for the failure to pay back taxes. The program has been lucrative as well. According to Governor Cuomo, last year tax collection increased approximately $56.4 million as a result of the program. Based on the program’s results, I would expect more states to follow New York’s enforcement procedure.
Contact a Tax Attorney Today
Adequately responding to the Division is essential to avoid the loss of your license for the failure to pay back taxes. If New York has threatened to suspend your driver’s license, then contact tax lawyer Todd S. Unger today (877) 544-4743.
