N.Y. Tax Law § 1141: Proceedings to recover tax

§ 1141. Proceedings to recover tax. (a) Whenever any person required

to collect tax shall fail to collect or pay over any tax, penalty or

interest imposed by this article as therein provided, or whenever any

customer shall fail to pay any such tax, penalty or interest, the

attorney general shall, upon the request of the tax commission, bring or

cause to be brought an action to enforce the payment of the same on

behalf of the state of New York in any court of the state of New York or

of any other state or of the United States.

(b) As an additional or alternate remedy, the tax commission may issue

a warrant, directed to the sheriff of any county commanding him to levy

upon and sell the real and personal property of any person liable for

the tax, which may be found within his county, for the payment of the

amount thereof, with any penalties and interest, and the cost of

executing the warrant, and to return such warrant to the tax commission

and to pay it the money collected by virtue thereof within sixty days

after the receipt of such warrant. The sheriff shall within five days

after the receipt of the warrant file with the county clerk a copy

thereof, and thereupon such clerk shall enter in the judgment docket the

name of the person mentioned in the warrant and the amount of the tax,

penalties and interest for which the warrant is issued and the date when

such copy is filed. Thereupon the amount of such warrant so docketed

shall become a lien upon the title to and interest in real and personal

property of the person against whom the warrant is issued. Such lien

shall not apply to personal property unless such warrant is filed in the

department of state. The sheriff shall then proceed upon the warrant, in

the same manner, and with like effect, as that provided by law in

respect to executions issued against property upon judgments of a court

of record and for services in executing the warrant he shall be entitled

to the same fees, which he may collect in the same manner. In the

discretion of the tax commission a warrant of like terms, force and

effect may be issued and directed to any officer or employee of the

department of taxation and finance, and in the execution thereof such

officer or employee shall have all the powers conferred by law upon

sheriffs, but shall be entitled to no fee or compensation in excess of

the actual expenses paid in the performance of such duty. Upon such

filing of a copy of a warrant, the tax commission shall have the same

remedies to enforce the amount due thereunder as if the state had

recovered judgment therefor.

(c) Whenever a person required to collect tax shall make a sale,

transfer, or assignment in bulk of any part or the whole of his business

assets, otherwise than in the ordinary course of business, the

purchaser, transferee or assignee shall at least ten days before taking

possession of the subject of said sale, transfer or assignment, or

paying therefor, notify the tax commission by registered mail of the

proposed sale and of the price, terms and conditions thereof whether or

not the seller, transferrer or assignor, has represented to, or informed

the purchaser, transferee or assignee that he owes any tax pursuant to

this article, and whether or not the purchaser, transferee, or assignee

has knowledge that such taxes are owing, and whether any such taxes are

in fact owing.

Whenever the purchaser, transferee or assignee shall fail to give

notice to the tax commission as required by the preceding paragraph, or

whenever the tax commission shall inform the purchaser, transferee or

assignee that a possible claim for such tax or taxes exists, any sums of

money, property or choses in action, or other consideration, which the

purchaser, transferee or assignee is required to transfer over to the

seller, transferrer or assignor shall be subject to a first priority

right and lien for any such taxes theretofore or thereafter determined

to be due from the seller, transferrer or assignor to the state, and the

purchaser, transferee or assignee is forbidden to transfer to the

seller, transferrer or assignor any such sums of money, property or

choses in action to the extent of the amount of the state's claim.

Within ninety days of receipt of the notice of the sale, transfer, or

assignment from the purchaser, transferee or assignee, the tax

commission shall give notice to the purchaser, transferee or assignee

and to the seller, transferrer, or assignor of the total amount of any

tax or taxes which the state claims to be due from the seller,

transferrer, or assignor to the state, and whenever the tax commission

shall fail to give such notice to the purchaser, transferee, or assignee

and the seller, transferrer, or assignor within ninety days from receipt

of notice of the sale, transfer, or assignment, such failure will

release the purchaser, transferee or assignee from any further

obligation to withhold any sums of money, property or choses in action,

or other consideration, which the purchaser, transferee or assignee is

required to transfer over to the seller, transferrer or assignor, except

that with respect to pending matters such ninety day periods shall not

begin to run until ninety days after the effective date of this

provision. For failure to comply with the provisions of this subdivision

the purchaser, transferee or assignee, in addition to being subject to

the liabilities and remedies imposed under the provisions of article six

of the uniform commercial code, shall be personally liable for the

payment to the state of any such taxes theretofore or thereafter

determined to be due to the state from the seller, transferrer or

assignor, except that the liability of the purchaser, transferee or

assignee shall be limited to an amount not in excess of the purchase

price or fair market value of the business assets sold, transferred or

assigned to such purchaser, transferee, or assignee, whichever is

higher, and such liability may be assessed and enforced in the same

manner as the liability for tax under this article. Upon receipt within

the ninety days as aforesaid of the notice of the total amount of the

state's claim from the tax commission, and demand for payment thereof,

the purchaser, transferee or assignee may make payment of such claim to

the state from any sums of money, property, or choses in action withheld

in accord with the provisions of this paragraph, except that such

payment shall be limited to an amount not in excess of the purchase

price or fair market value of the business assets sold, transferred, or

assigned to such purchaser, transferee, or assignee, whichever is

higher, and upon making the payment, such purchaser, transferee, or

assignee shall be relieved of all liability for such amounts to the

seller, transferrer, or assignor, and such amounts paid to the state

shall be deemed satisfaction of the tax liability of the seller,

transferrer, or assignor to the extent of the amount of such payment.

Where the liability of a purchaser, transferee or assignee, for the

payment to the state of any such taxes determined to be due from the

seller, transferrer or assignor, has been wholly paid or satisfied or no

longer exists, the tax commission shall mail to such purchaser,

transferee or assignee a notice, addressed to his last known address,

setting forth that such liability has been wholly paid or satisfied or

no longer exists. The tax commission shall include in such notice the

following additional information:

(1) the name and last known address of the purchaser, transferee or

assignee;

(2) the amount of the lien paid, satisfied or vacated; and

(3) a statement to the effect that consumer reporting agencies must

delete from a credit file any reference to the particular tax lien

within thirty days of receipt from the purchaser, transferee or assignee

of such notice. Provided, however, no order or decree in a bankruptcy

proceeding shall be construed as giving rise to the requirement that the

notice provided for in this paragraph be given.