N.Y. Tax Law § 1703: Information returns relating to payments made in settlement of payment card and third party network transactions

§ 1703. Information returns relating to payments made in settlement of

payment card and third party network transactions. 1. (a) Every payment

settlement entity, third party settlement organization, electronic

payment facilitator or other third party acting on behalf of a payment

settlement entity, all as defined in section 6050W of the internal

revenue code and referred to herein as "a reporting entity," required to

file information returns pursuant to that section shall, within thirty

days of the filing thereof, file with the department in such form and

manner as prescribed by the commissioner either (i) a duplicate of all

such information returns or (ii) a duplicate of such information returns

related to participating payees, as defined in section 6050W of the

internal revenue code, with a New York state address or New York state

taxpayers. The commissioner may require that such returns be filed

electronically.

(b) To facilitate accurate reporting by the entities required to file

information returns pursuant to this section, the department shall

provide a list or database of New York state taxpayers no later than

forty-five days prior to the information reporting deadline, in such

form and manner as prescribed by the commissioner. The information

included in such list or database shall not be used by a reporting

entity for any purpose other than producing and filing information

returns pursuant to this section.

(c) Any information received by the department on an information

return filed pursuant to this section, concerning a person who is not

subject to tax in New York, or is not subject to any requirement imposed

by or pursuant to the authority of this chapter, may not be used by the

department. The department shall not redisclose any information received

on an information return filed pursuant to this section, except that it

may disclose to the commissioner of finance of the city of New York, for

the purpose of the administration of laws relating to taxes or charges

collected by the commissioner of finance of the city of New York,

information received on such returns concerning any person or entity

with a New York city address or that is a New York city taxpayer or that

is required to pay New York city taxes and/or charges or that is subject

to any reporting requirement pursuant to New York city tax laws.

2. (a) Any reporting entity failing to file an information return

required pursuant to subdivision one of this section within the time

prescribed will be subject to a penalty of fifty dollars for each

failure, if failure is for not more than one month, with an additional

fifty dollars for each month or fraction thereof during which each

failure continues. However, the total amount of penalty imposed on a

reporting entity may not exceed two hundred fifty thousand dollars

annually.

(b) The commissioner may waive all or any portion of any penalty

imposed by this subdivision with respect to any violation if (i) the

commissioner determines that the failure to timely file a return, was

due to reasonable cause and not due to willful neglect, or (ii)

rescinding the penalty would promote compliance with the requirements of

this chapter and effective tax administration.