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State and Local Tax Blog

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Taxes in New York (TiNY) is a blog by the Hodgson Russ LLP State and Local Tax Practice Group. The weekly reports are intended to go out within 24 hours of the Division of Tax Appeals’ (DTA) publication of new ALJ Determinations and Tribunal Decisions. In addition to the weekly reports TiNY may provide analysis of and commentary on other developments in the world of New York tax law.  

TiNY Report for April 20, 2017

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Four Determinations and one ALJ Order.

DETERMINATIONS:

Matter of Bucher and Ericson; Supervising ALJ Friedman; Division’s Rep: Linda Jordan and Brian McCann; Taxpayer’s Rep: Bradley Dorin and David Selig; Article 22.  When the deductibility of business expenses is in question, taxpayers “have the double burden of (1) demonstrating entitlement to the deductions and (2) substantiating the amounts of the deductions”.  The Division allowed some deductions, post-audit, after the taxpayer’s provided substantiation.  The disallowance of other claimed deductions was sustained, the ALJ finding the taxpayers’ proof wanting:  “[P]etitioner’s vague testimony and limited source records do not support the remaining claimed deductions. Contrary to petitioners’ assertions, the evidence shows that the Division reviewed and considered the records provided; they simply did not support the claimed deductions. Therefore, petitioners must yield to the presumption of correctness… .”

Matter of Chowdhury and Nahar; Judge Russo; Division’s Rep: Charles Fishbaum; Taxpayers’ Rep: Pro se; Article 22.  The Division’s motion for summary determination was granted because the Taxpayers filed their BCMS request challenging a December 7, 2015 Notice on March 21, 2016, or about two weeks after the 90-day deadline.  The Division proved both its standard mailing practices and that those practices were followed in this instance.  Yada, yada, yada.

Matter of Carroll; Judge Russo; Division’s Rep: Christopher O’Brien; Taxpayers’ Rep: Pro se; Article 22. The denial of the taxpayer’s claimed child and dependent care credit was sustained.  The Taxpayer’s documentation of the provision and cost of child care was informal, late, and inconsistent with the amount of the credits claimed.

Matter of Dahi and Maham; Judge Gardiner; Division’s Rep: Charles Fishbaum; Taxpayers’ Rep: Pro se; Article 22.  The Division’s motion for summary determination was granted because the Taxpayers filed their BCMS request challenging an April 28, 2014 Notice on December 23, 2015, about five months after the 90-day deadline.  The Division proved both its standard mailing practices and that those practices were followed in this instance, yada, yada, yada.

ORDER:

Matter of Setek; Judge Gardiner; Division’s Rep: Linda Jordan; Taxpayers’ Rep: Geoffrey O’Connor; Proposed Driver License Suspension.  Even though the petition did not allege one of the seven statutory defenses, while the matter was pending (and after the Division made its summary judgement motion) the taxpayer entered bankruptcy.  According to the affidavits put into evidence when the Division made its motion, once a taxpayer goes into bankruptcy the license suspension process is either canceled or “placed on hold”.  The proof before Judge Gardiner did not show whether the Division suspended or canceled the process, so the Judge found that there was a material issue of fact requiring a hearing.

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