N.Y. General Business Law § 372: Consumer bill of rights regarding tax preparers

§ 372. Consumer bill of rights regarding tax preparers. (a) A tax

preparer shall provide his or her customers with a receipt containing an

address and phone number at which the preparer can be contacted

throughout the year.

(b) The department shall, in accordance with regulations promulgated

by the commissioner of taxation and finance, produce and make available

to taxpayers and tax preparers an informational flier regarding

consumers' rights and laws concerning tax preparers to be called a

"consumer bill of rights regarding tax preparers". The department shall

consult with the department of state, to enhance distribution of fliers

to consumers. The flier shall also be made available on the department

and the department of state's internet site, and shall contain

information including, but not limited to, the following:

(1) postings required by state and federal laws, such as price posting

and posting of qualifications;

(2) explanations of some of the commonly offered services and industry

jargon, such as preparation of short and long federal forms, refund,

electronic filing, express mail, direct deposit, refund anticipation

check, refund anticipation loan, quick, instant, rapid, fast, fee, and

interest;

(3) basic information on what a tax preparer is and is not required to

do for a consumer, such as the preparer's responsibility to sign a

return, that a tax preparer may not be required to accompany a consumer

to an audit but the company may have a voluntary policy to accompany

consumers to audits; and

(4) the telephone numbers of the department for information and

complaints.

The flier shall be in a form which is easily reproducible by photocopy

machine.

(c) The department shall coordinate its response to consumer tax

preparer complaints with the department of state, as the department

deems appropriate.

(d) A copy of the consumer bill of rights regarding tax preparers

shall be provided to individuals or businesses on request to the

department, and shall be sent by the department no later than October

fifteenth of each year to each tax preparer who has been found to be in

violation of this subdivision or any other provision of this section

within the previous calendar year. Each tax preparer subject to this

section shall obtain a current consumer's bill of rights regarding tax

preparers from the department and shall reproduce it so that it is clear

and legible. As of January first of each year, each tax preparer shall

give to each customer, free of charge, a current, legible copy of the

consumer's bill of rights regarding tax preparers prior to any

discussion with the customer. Each such tax preparer shall also verbally

direct the consumer to review the consumer bill of rights regarding tax

preparers and shall answer any questions the consumer may have about its

contents.

(e) (1) Any tax preparer who advertises the availability of a refund

anticipation loan or refund anticipation check may not directly or

indirectly represent such a loan as a refund. Any advertisement which

mentions a refund anticipation loan must state conspicuously that it is

a loan and that a fee or interest will be charged by the lending

institution. The advertisement must also disclose the name of the

lending institution.

(2) (i) Before any taxpayer enters into a refund anticipation loan,

the tax preparer facilitating such loan shall provide the following

disclosure to the taxpayer in writing in at least fourteen-point type:

"YOU ARE NOT REQUIRED TO ENTER INTO THIS REFUND ANTICIPATION LOAN

AGREEMENT MERELY BECAUSE YOU HAVE RECEIVED THIS INFORMATION.

IF YOU DO SIGN A CONTRACT FOR A REFUND ANTICIPATION LOAN, YOU WILL BE

TAKING OUT A LOAN. YOU WILL BE RESPONSIBLE FOR REPAYMENT OF THE ENTIRE

LOAN AMOUNT AND ALL RELATED COSTS AND FEES, REGARDLESS OF HOW MUCH MONEY

YOU ACTUALLY RECEIVE IN YOUR TAX REFUND. IF YOUR REFUND IS DELAYED, YOU

MAY HAVE TO PAY ADDITIONAL COSTS.

IF YOU DO NOT TAKE OUT THIS REFUND ANTICIPATION LOAN, YOU ARE ELIGIBLE

TO RECEIVE A GROSS TAX REFUND OF APPROXIMATELY $(insert amount).

IF YOU DO TAKE OUT THIS REFUND ANTICIPATION LOAN, YOU WILL BE

RESPONSIBLE TO PAY $(insert amount) IN FEES FOR THE LOAN. AFTER THESE

FEES ARE PAID, YOU WILL RECEIVE APPROXIMATELY $ (insert amount) AS YOUR

LOAN.

THE ESTIMATED ANNUAL PERCENTAGE RATE OF YOUR REFUND ANTICIPATION LOAN

IS (insert amount)%. THIS IS BASED ON THE ACTUAL AMOUNT OF TIME YOU WILL

BE LENT MONEY THROUGH THIS REFUND ANTICIPATION LOAN.

IF YOU DO TAKE OUT THIS REFUND ANTICIPATION LOAN, YOU CAN EXPECT TO

RECEIVE YOUR LOAN WITHIN APPROXIMATELY TWO BUSINESS DAYS OF (insert

date).

IF YOU DO NOT TAKE OUT THIS REFUND ANTICIPATION LOAN, YOU CAN STILL

RECEIVE YOUR TAX REFUND QUICKLY. IF YOU FILE YOUR TAX RETURN

ELECTRONICALLY AND RECEIVE YOUR TAX REFUND THROUGH THE MAIL, YOU CAN

EXPECT TO RECEIVE YOUR REFUND WITHIN APPROXIMATELY TWO BUSINESS DAYS OF

(insert date). IF YOU FILE YOUR TAX RETURN ELECTRONICALLY AND HAVE YOUR

TAX REFUND DIRECTLY DEPOSITED INTO A BANK ACCOUNT, YOU CAN EXPECT TO

RECEIVE YOUR REFUND WITHIN APPROXIMATELY TWO BUSINESS DAYS OF (insert

date)."

(ii) Before any taxpayer enters into an agreement to receive a refund

anticipation check, the tax preparer facilitating the agreement shall

provide the following disclosure to the taxpayer in writing in at least

fourteen-point type:

"YOU ARE NOT REQUIRED TO ENTER INTO THIS REFUND ANTICIPATION CHECK

AGREEMENT MERELY BECAUSE YOU HAVE RECEIVED THIS INFORMATION. IF YOU DO

TAKE OUT THIS REFUND ANTICIPATION CHECK, YOU WILL BE RESPONSIBLE TO PAY

$(insert amount) IN FEES FOR THE CHECK TO BE ISSUED BY (insert name of

issuer of refund anticipation check). YOU CAN AVOID THIS FEE AND STILL

RECEIVE YOUR REFUND IN THE SAME AMOUNT OF TIME BY HAVING YOUR REFUND

DIRECTLY DEPOSITED INTO YOUR OWN BANK ACCOUNT. YOU CAN ALSO WAIT FOR THE

FEDERAL OR STATE REFUND TO BE MAILED TO YOU.

IF YOU DO ENTER INTO THIS REFUND ANTICIPATION CHECK AGREEMENT, YOU CAN

EXPECT TO RECEIVE YOUR CHECK BY APPROXIMATELY TWO BUSINESS DAYS OF

(insert date).

IF YOU DO NOT ENTER INTO THIS REFUND ANTICIPATION CHECK AGREEMENT, YOU

CAN STILL RECEIVE YOUR TAX REFUND QUICKLY. IF YOU FILE YOUR TAX RETURN

ELECTRONICALLY AND RECEIVE YOUR TAX REFUND THROUGH THE MAIL, YOU CAN

EXPECT TO RECEIVE YOUR REFUND WITHIN APPROXIMATELY TWO BUSINESS DAYS OF

(insert date). IF YOU FILE YOUR TAX RETURN ELECTRONICALLY AND HAVE YOUR

TAX REFUND DIRECTLY DEPOSITED INTO A BANK ACCOUNT, YOU CAN EXPECT TO

RECEIVE YOUR REFUND WITHIN APPROXIMATELY TWO BUSINESS DAYS OF (insert

date)."

(iii) It shall be the obligation of the tax preparer to complete the

required disclosures accurately with all relevant information for each

taxpayer and to ensure that the completed disclosure form is signed by

the taxpayer before he or she enters into a refund anticipation loan or

a refund anticipation check, with a copy of the same provided to the

taxpayer. The name and the unique identification number of the tax

return preparer (and facilitator, if different) assigned pursuant to

section thirty-two of the tax law must be included on the disclosure

form provided to the taxpayer.

(f)(1) If a taxpayer applies for a refund anticipation loan, the

facilitator must also orally inform the taxpayer in the language

primarily used for oral communications between the facilitator and

taxpayer:

(i) that the product is a loan that only lasts one to two weeks;

(ii) if the tax refund is less than expected, the taxpayer is liable

for the full amount of the loan and must repay any difference;

(iii) if the refund is delayed for any reason, there may be additional

costs, such as additional interest, that the taxpayer will have to pay;

(iv) the amount of the refund anticipation loan fee; and

(v) the refund anticipation loan interest rate.

(2) If a taxpayer applies for a refund anticipation check, the

facilitator must also orally inform the taxpayer in the language

primarily used for oral communications between the facilitator and

taxpayer:

(i) the amount of the refund anticipation check fee; and

(ii) that the taxpayer can receive a refund in the same amount of time

without a fee if the tax return is filed electronically, and the

consumer chooses direct deposit to their own personal bank account.

(g) Any person, partnership, corporation or other business entity who

violates any provision of this section or any of the regulations

promulgated pursuant to this section shall be liable for a civil penalty

of not less than two hundred fifty dollars nor more than five hundred

dollars for the first violation and for each succeeding violation a

civil penalty of not less than five hundred dollars nor more than seven

hundred fifty dollars. The penalties provided for by this subdivision

must be paid upon notice and demand and will be assessed, collected and

paid in the same manner as taxes under article twenty-seven of the tax

law.

(h) Apart from subdivision (e) of this section and the accompanying

penalties as listed in subdivision (f) of this section, the provisions

of this section shall not apply to:

(1) an officer or employee of a corporation or business enterprise

who, in his or her capacity as such, advises or assists in the

preparation of income tax returns relating to such corporation or

business enterprise;

(2) an attorney at law who advises or assists in the preparation of

income tax returns in the practice of law and the employees thereof;

(3) a fiduciary and the employees thereof who advise or assist in the

preparation of income tax returns on behalf of the fiduciary estate, the

testator, trustee, grantor or beneficiaries thereof;

(4) a certified public accountant licensed pursuant to the education

law or licensed by one or more of the states or jurisdictions of the

United States, and the employees thereof;

(5) a public accountant licensed pursuant to the education law and the

employees thereof;

(6) an employee of a governmental unit, agency or instrumentality who

advises or assists in the preparation of income tax returns in the

performance of his or her official duties; or

(7) an agent enrolled to practice before the internal revenue service

pursuant to section 10.4 of subpart A of part ten of title thirty-one of

the code of federal regulations.