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Taxes in New York (TiNY) is a blog by the Hodgson Russ LLP State and Local Tax Practice Group members Chris Doyle, Peter Calleri, and Zoe Peppas. The weekly reports are intended to go out every Tuesday after the New York State Division of Tax Appeals (DTA) publishes 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.

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TiNY Report for March 2, 2018 (covering DTA cases from February 22)

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This was a pretty mundane week compared to last week’s page-turners.  Two ALJ Determinations, and nothing from the Tribunal.

Matter of Randle; Judge: Law; Division’s Rep: Charles Fishbaum; Taxpayer’s Rep: pro se; Article 22.  Petitioners jointly filed a 2012 NY income tax return.  They later amended their return and claimed a New York subtraction of $11,100 for contribution to “New York’s 529 college savings program” (“529 Program”) and requested a refund.  Petitioners’ amended 2012 return was selected for review.  The auditor discovered that neither Petitioner made contributions to the 529 Program, and issued a Notice of Deficiency disallowing the contribution claim. 

The Division established why it disallowed the 529 Program contribution, and the Judge determined the Division assessed additional tax accordingly.  The Judge disagreed with Petitioners’ argument that there are no laws requiring them to pay income taxes because, as it turns out (shocker!) there are indeed laws imposing income tax on Petitioners.  Petitioners failed to submit any credible evidence that raised a material issue of fact to dispute the facts set forth in the Divisions’ papers.  As a result, the Judge determined the Division sufficiently proved there were no triable issues of fact.  Lastly, the Judge imposed the maximum penalty of $500 for filing a frivolous petition because Petitioners’ argument that there are no laws requiring them to pay income tax was “patently frivolous.”  Comments:  The penalty for frivolous petitions really needs to be higher than $500.

Matter of Rosenbaum; Judge: Connolly; Division’s Rep: Frank Nuara; Taxpayer’s Rep: Isaac Sternheim; Articles 28 & 29.  The Division sufficiently proved its standard mailing procedures and that they were followed to mail the Notice of Determine to Petitioner’s last known address.  Petitioner mailed his BCMS request after the 90-day limitations period ended, so the Judge deemed the BCMS request untimely filed. 

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