New York Codes, Rules and Regulations
Title 20 - DEPARTMENT OF TAXATION AND FINANCE
Chapter IX - Procedural Regulations
Part 2396 - Electronic Filing And Funds Transfer Program For Certain Taxpayers Remitting Withholding Tax
Section 2396.3 - Participating taxpayers
Universal Citation: 20 NY Comp Codes Rules and Regs ยง 2396.3
Current through Register Vol. 46, No. 12, March 20, 2024
(a) General rule. Subject to the provisions of subdivisions (b) and (c) of this section, relating to exemptions and special entities, respectively, every taxpayer which is required to deduct and withhold $35,000 or more of tax for either of the semi-annual periods ending June 30th or December 31st pursuant to part V of article 22 of the Tax Law, or pursuant to an equivalent provision enacted under the authority of article 30, 30-A or 30-B of the Tax Law shall be required to participate in the program.
(1)
$35,000 or more an aggregate amount. For purposes of determining whether the
$35,000 or more threshold is met, New York State, City of New York and City of
Yonkers withholding taxes shall be aggregated.
(2) $35,000 or more threshold applies to each
withholding taxpayer. Every taxpayer which is identified by either its own
separate Federal employer identification number, or its own separate New York
State employer identification number, in accordance with section 6109 of the
Internal Revenue Code and regulations promulgated thereunder, or with section
174.5
of this Title, respectively, shall be treated as a separate withholding
taxpayer for purposes of determining whether the $35,000 or more threshold is
met.
(b) Exemption.
(1) General rule. A taxpayer described in
subdivision (a) of this section shall be exempt from participation in the
program if the aggregate tax withheld by the taxpayer, pursuant to the most
recent annual reconciliation of withholding required to be filed is less than
$100,000.
(2) The exemption
threshold applies to each separate withholding taxpayer. Every taxpayer which
is identified by either its own separate Federal employer identification or its
own separate New York State employer identification number, in accordance with
section 6109 of the Internal Revenue Code and regulations promulgated
thereunder, or with section
174.5
of this Title, respectively, shall be treated as a separate withholding
taxpayer for purposes of determining whether the exemption threshold specified
in paragraph (1) of this subdivision is met.
(c) Special entities.
(1) Health care providers. Health care
providers, as defined in section
9(a)(4) of the Tax Law, are
exempt from the requirements to participate in the program.
(2) Educational organizations. Educational
organizations, as defined by section
9(a)(2) of the Tax Law, are
required to participate in the program if the eligibility requirements in
subdivisions (a) and (b) of this section are met. (See section
2396.9
for special rules governing the program participation of educational
organizations.)
(d) Voluntary participation.
(1) Application. Any
withholding tax taxpayer not required to participate in the program may, at any
time, submit a request to the department for permission to voluntarily
participate in the program.
(2)
Standard. Any taxpayer that applies to voluntarily participate shall be granted
permission to participate unless the department determines that the
administrative costs associated with accepting new enrollees into the program
outweigh the revenue and tax administration benefits associated with payment by
EFT or certified check. The administrative costs considered in the
determination include, but are not limited to, increasing systems capacities,
adding depository bank resources and adding program specialists within the
department.
(3) Notice. The
department shall notify the taxpayer of the decision within 30 calendar days of
the receipt of the request to voluntarily participate. If the department grants
permission to the taxpayer, it shall also make available to the taxpayer all
the instructions and information necessary to ensure successful participation
in the program.
(4) Conditions of
participation.
(i) General. The provisions of
section
2396.7
of this Part shall apply to all withholding tax taxpayers voluntarily
participating in the program, other than those taxpayers specified in
subparagraph (ii) of this paragraph, and with the limitation described in
subparagraph (iii) of this paragraph.
(ii) Health care providers and educational
organizations. The provisions of section
2396.9
of this Part shall apply to health care providers and educational organizations
voluntarily participating in the program, with the limitation described in
subparagraph (iii) of this paragraph.
(iii) Payment options available. The
department may limit the selection of payment options available to voluntary
participants in the program. If the department limits the selection of options,
it will inform taxpayers during the enrollment process about the payment
options available. (See sections
2396.7
and
2396.9
of this Part for more information about payment options.)
(5) Duration of participation.
(i) General. A taxpayer accepted to
voluntarily participate in the program shall be required to participate in the
program through at least the succeeding June 30th, unless otherwise notified by
the department.
(ii) Ceasing
voluntary participation.
(a) Automatic
taxpayer election. No later than June 20th, if in writing, or June 30th, if
online, of each year, a taxpayer voluntarily participating in the program may
notify the department that it no longer elects to participate in the program
for the succeeding period beginning after June 30th. The department shall
advise the taxpayer of whether the notification was timely made. If such
notification is not timely made, such taxpayer must continue to participate in
the program for the upcoming program year.
(b) Taxpayer hardship. If a taxpayer wishes
to cease participation before the period ending June 30th, the taxpayer may
apply to the department to do so at any time. The department shall advise the
taxpayer of the decision within 30 calendar days of the receipt of the request.
The request shall not be granted unless the taxpayer demonstrates that
continuation of its voluntary participation will result in hardship to the
taxpayer. If the request is granted, the department shall advise the taxpayer
of the date for final filing and payment by an EFT method.
(c) Department's determination. The
department may, at any time after enrollment and on 30 business days' notice,
advise the taxpayer that it will no longer be permitted to participate in the
program on a voluntary basis.
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