When faced with back taxes owed in NY it is important to understand just like with the IRS, there are Installment Agreements as well ways to extend your filing and payment dates. State taxes in NY cannot easily be settled, but resolutions with problems such as wage garnishment, bank levies, payroll taxes, audits, and more are possible.
If you are having trouble paying during this economic downturn you can request an Installment Agreement to help pay off your taxes over time or a series of monthly payments. Installment Agreements are accepted based upon your previous history with the NY Dept of Taxation and Finance and by your current financial situation. The instructions to how to request an installment agreement can be found here: New York Tax Installment Agreement. Basically, call 1-800-835-3554, enter your Taxpayer ID and 4 digit pin number that is found on your bill.
Generally, NY will offer a 36-month tax payment plan but under a hardship situation they can approve up to a 60-month plan.
Just like the IRS, the State of New York allows certain financially stressed taxpayers to pay less than they owe. The state of New York refers to the Offer In Compromise as an “offer”. They do not accept all offers and if a taxpayer owes more than $100k (excluding penalties and interest), the offer would have to be accepted by a NY Supreme Court Justice.
A a general rule of thumb, the NY State Department of taxation requires taxpayers be insolvent (whereby liabilities exceed assets) and it is doubtful that NY state would collect the full amount from the taxpayer. Before any OIC is considered, all tax returns need to be filed.
If you are looking for an extension to file your taxes then you can use the forms below. Realize that forms must be believed on or before the due date of the return. Extensions range from 3-6 to 6 months with 6 months being the max.
3 Month Extension To File New York Income Taxes: Form CT-5.9
6 Month Extension To File New York Income Taxes: Form IT-370
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