N.Y. Tax Law § 694: Jeopardy assessment

§ 694. Jeopardy assessment.--(a). Authority for making.--If the tax

commission believes that the assessment or collection of a deficiency

will be jeopardized by delay, it shall, notwithstanding the provisions

of section six hundred eighty-one and six hundred ninety-six,

immediately assess such deficiency (together with all interest,

penalties and additions to tax provided for by law), and notice and

demand shall be made by the tax commission for the payment thereof.

(b) Notice of deficiency.--If the jeopardy assessment is made before

any notice in respect of the tax to which the jeopardy assessment

relates has been mailed under section six hundred eighty-one, then the

tax commission shall mail a notice under such section within sixty days

after the making of the assessment.

(c) Amount assessable before decision of tax commission.--The jeopardy

assessment may be made in respect of a deficiency greater or less than

that of which notice is mailed to the taxpayer and whether or not the

taxpayer has theretofore filed a petition with the tax commission. The

tax commission may, at any time before rendering its decision, abate

such assessment, or any unpaid portion thereof, to the extent that it

believes the assessment to be excessive in amount. The tax commission

may in its decision redetermine the entire amount of the deficiency and

of all amounts assessed at the same time in connection therewith.

(d) Amount assessable after decision of tax commission.--If the

jeopardy assessment is made after the decision of the tax commission is

rendered, such assessment may be made only in respect of the deficiency

determined by the tax commission in its decision.

(e) Expiration of right to assess.--A jeopardy assessment may not be

made after the decision of the tax commission has become final or after

the taxpayer has made an application for review of the decision of the

tax commission.

(f) Collection of unpaid amounts.--When a petition has been filed with

the tax commission and when the amount which should have been assessed

has been determined by a decision of the tax commission which has become

final, then any unpaid portion, the collection of which has been stayed

by bond, shall be collected as part of the tax upon notice and demand

from the tax commission, and any remaining portion of the assessment

shall be abated. If the amount already collected exceeds the amount

determined as the amount which should have been assessed, such excess

shall be credited or refunded to the taxpayer as provided in section six

hundred eighty-six without the filing of claim therefor. If the amount

determined as the amount which should have been assessed is greater than

the amount actually assessed, then the difference shall be assessed and

shall be collected as part of the tax upon notice and demand from the

tax commission.

(g) Abatement if jeopardy does not exist.--The tax commission may

abate the jeopardy assessment if it finds that jeopardy does not exist.

Such abatement may not be made after a decision of the tax commission in

respect of the deficiency has been rendered or, if no petition is filed

with the tax commission, after the expiration of the period for filing

such petition. The period of limitation on the making of assessments and

levy or a proceeding for collection, in respect of any deficiency, shall

be determined as if the jeopardy assessment so abated had not been made,

except that the running of such period shall in any event be suspended

for the period from the date of such jeopardy assessment until the

expiration of the tenth day after the day on which such jeopardy

assessment is abated.

(h) Bond to stay collection.--The collection of the whole or any

amount of any jeopardy assessment may be stayed by filing with the tax

commission, within such time as may be fixed by regulation, a bond in an

amount equal to the amount as to which the stay is desired, conditioned

upon the payment of the amount (together with interest thereon) the

collection of which is stayed at the time at which, but for the making

of the jeopardy assessment, such amount would be due. Upon the filing

of the bond the collection of so much of the amount assessed as is

covered by the bond shall be stayed. The taxpayer shall have the right

to waive such stay at any time in respect of the whole or any part of

the amount covered by the bond, and if as a result of such waiver any

part of the amount covered by the bond is paid, then the bond shall at

the request of the taxpayer, be proportionately reduced. If any portion

of the jeopardy assessment is abated, or if a notice of deficiency under

section six hundred eighty-one is mailed to the taxpayer in a lesser

amount, the bond shall, at the request of the taxpayer, be

proportionately reduced.

(i) Petition to tax commission.--If the bond is given before the

taxpayer has filed his petition under section six hundred eighty-nine,

the bond shall contain a further condition that if a petition is not

filed within the period provided in such section, then the amount, the

collection of which is stayed by the bond, will be paid on notice and

demand at any time after the expiration of such period, together with

interest thereon from the date of the jeopardy notice and demand to the

date of notice and demand under this subsection. The bond shall be

conditioned upon the payment of so much of such assessment (collection

of which is stayed by the bond) as is not abated by a decision of the

tax commission which has become final. If the tax commission determines

that the amount assessed is greater than the amount which should have

been assessed, then the bond shall, at the request of the taxpayer, be

proportionately reduced when the decision of the tax commission is

rendered.

(j) Stay of sale of seized property pending tax commission

decision.--Where a jeopardy assessment is made, the property seized for

the collection of the tax shall not be sold--

(1) if subsection (b) is applicable, prior to the issuance of the

notice of deficiency and the expiration of the time provided in section

six hundred eighty-nine for filing a petition with the tax commission,

and

(2) if a petition is filed with the tax commission (whether before or

after the making of such jeopardy assessment), prior to the expiration

of the period during which the assessment of the deficiency would be

prohibited if subsection (a) were not applicable.

Such property may be sold if the taxpayer consents to the sale, or if

the tax commission determines that the expenses of conservation and

maintenance will greatly reduce the net proceeds, or if the property is

perishable.

(k) Interest.--For the purpose of subsection (a) of section six

hundred eighty-four, the last date prescribed for payment shall be

determined without regard to any notice and demand for payment issued

under this section prior to the last date otherwise prescribed for such

payment.

(l) Early termination of taxable year.--If the tax commission finds

that a taxpayer designs quickly to depart from this state or to remove

his property therefrom, or to conceal himself or his property therein,

or to do any other act tending to prejudice or to render wholly or

partly ineffectual proceedings to collect the income tax for the current

or the preceding taxable year unless such proceedings be brought without

delay, the tax commission shall declare the taxable period for such

taxpayer immediately terminated, and shall cause notice of such finding

and declaration to be given the taxpayer, together with a demand for

immediate payment of the tax for the taxable period so declared

terminated and of the tax for the preceding taxable year or so much of

such tax as is unpaid, whether or not the time otherwise allowed by law

for filing return and paying the tax has expired; and such taxes shall

thereupon become immediately due and payable. In any proceeding brought

to enforce payment of taxes made due and payable by virtue of the

provisions of this subsection, the finding of the tax commission made as

herein provided, whether made after notice to the taxpayer or not, shall

be for all purposes presumptive evidence of jeopardy.

(m) Reopening of taxable period.--Notwithstanding the termination of

the taxable period of the taxpayer by the tax commission, as provided in

subsection (l), the tax commission may reopen such taxable period each

time the taxpayer is found by the tax commission to have received

income, within the current taxable year, since the termination of such

period. A taxable period so terminated by the tax commission may be

reopened by the taxpayer if he files with the tax commission a true and

accurate return of taxable income and credits allowed under this article

for such taxable period, together with such other information as the tax

commission may by regulations prescribe.

(n) Furnishing of bond where taxable year is closed by the tax

commission.--Payment of taxes shall not be enforced by any proceedings

under the provisions of subsection (l) prior to the expiration of the

time otherwise allowed for paying such taxes if the taxpayer furnishes,

under regulations prescribed by the tax commission, a bond to insure the

timely making of returns with respect to, and payment of, such taxes or

any income taxes for prior years.