Statute of Limitations for a NYS Tax Warrant
The State of New York issues tax warrants for debts. This is the New York State equivalent of an IRS Federal Tax Lien. The difference is New York is more aggressive in collecting on the warrant. The IRS will try to collect too, but often New York comes first. Once a return is filed, the statute of limitations to add an additional assessment for the State of New York is 3 years, 6 years in the case of abusive tax avoidance transactions
So What is the NYS Tax Warrant Statute of Limitations?
20 years. The State of New York has 20 years from the date a warrant could have been filed to collect on a tax debt. This is double the ten years given for the IRS Collection Statute Expiration Date. NYS will be actively trying to collect while IRS debts are already expired. For assessing additional debt, NYS generally has 3 years.
A law in 2011 changed the start of time tolling from the actual warrant filing date to the date that New York State could have filed the warrant. Prior to that NYS could delay warrant filings and thus extend the collection period.
Another difference from the IRS is the IRS does not have to have been able to file a lien for them to start their statute of limitations. The IRS statute starts running as soon as the return is processed.
How to Prevent NY State Tax Levies and Garnishments After a Tax Warrant Is Issued?
The NYS Department of Taxation and Finance will place your case into collections when you owe a tax debt. They issue the tax warrant before actually coming to take any property, garnish your pay check, or levy your bank account. The tax warrant is issued after correspondence is received regarding the debt.. Letters will state that you need to pay off the debt or make arrangements or a tax warrant will be issued. If the balance is high enough, a tax warrant will be issued even if you get into a payment plan.
Your Options For Dealing With a NYS Tax Warrant
New York State has three main options when it comes to your back due tax debt:
- Payment Plan – You enter into a payment plan to pay off the back due debt.
- Hardship – Your case is placed into temporary hardship because you cannot afford to pay.
- Settlement – You settle the tax debt for less than you owe through a NY State Offer in Compromise.
You can also do nothing, but that usually does not end well. The NYS Department will eventually hit your paycheck and bank account. They will place a lien on any real property you own also. Offer in Compromise is the best option of the three, but not everyone qualifies. Those that qualify for a hardship usually qualify for an Offer in Compromise. Payment plans are a common option. If you have a lot of assets or high income, that often is the only option.
To get a full understanding of your options in dealing with a NYS tax warrant, consult a licensed tax attorney.
If you owe $20,000 or more, contact us for a free, no obligation consultation with one of our expert tax attorneys at the contact us form on our website. Why hire Las Vegas tax attorneys to handle NY State tax debt? We have handled more NYS tax debt cases than most NY tax lawyers, getting our clients stellar results. Our rates are substantially lower than NY tax attorneys. Get help today. The worst thing that can happen is you are more informed of your options after the consultation.