In a recently signed bill, A.B. 10222, New York Governor Kathy Hochul introduced significant changes regarding New York Tax Tribunal representation. In short, the new legislation now allows anyone who is at least 18 years old to represent a taxpayer a taxpayer at the New York tax tribunal. The effective date of legislation was immediate.
While some taxpayers may believe that this is a landslide win, as taxpayers may no longer need to engage with CPAs or New York sales tax attorneys, this could be a catastrophe in the making.
Tax Tribunal Representation – More harm than good for New York Taxpayers
First, in order to petition to the tax tribunal, certain administrative procedural issues must be followed. For example, there are deadlines that New York taxpayers must keep in mind when receiving their Notice of Determination or Conciliation Order from the Conferee as a result of Conciliation Conference. If timing is not adequately met, a taxpayer will generally lose protection of its administrative appeal remedy. Therefore, reliance on a New York state and local tax professionals to properly abide by procedural rules prolonged by New York state is a key concept in preserving your appealable rights.
Second, the bill was, interestingly enough, introduced at the request of the New York Department of Taxation and Finance (NYDTF). One might say that the NYDTF is very considerate of New York taxpayers who cannot afford representation, and now, for example, can have a friend who is in law school defend certain New York sales and use tax positions for free.
However, it is also possible the NYDTF and the General Counsel’s Office would rather defend its position, as a respondent, against a taxpayer who is represented by someone with little knowledge of New York state and local tax laws. In support of the above, Sales Tax Helper has been engaged in a number of New York appeal matters. Sometimes, we are engaged after the taxpayer handles the audit in-house and is not successful in defending its position. On appeals, we are successful, whereas the taxpayer during the audit was not. Why? Because we are sales tax professionals. Therefore, seek professional tax assistance – always.
Third, if a taxpayer is considering filing a New York tax tribunal petition, materiality is likely at hand and we must consider the economics. For example, a New York sales and use tax assessment that is $1,000,000 is more likely to file an appeal than an assessment that is $100. Taxpayer’s should know that a decision on your New York tax appeal can take a significant amount of time. During that time, and if a taxpayer chooses not to pay down any of the assessed amount, interest continues to accrue. Therefore, when considering cases and materiality that actually make their way towards the Conciliation Conference or to New York Tax Tribunal, the cost of legal representation is generally not material in comparison to the assessed tax due owed, along with potential accrual of penalties and interest.
Seek New York Sales Tax Representation – Always
In summary, it is highly recommended to always seek competent and professional New York legal sales tax representation. We, at Sales Tax Helper, are always here to help. If representation is avoided due to the cost of high legal fees, schedule a call with one of our New York tax attorneys or CPAs. We are here to provide value and deliver results. If legal fees are of concern, please discuss this with our team and we will accommodate to the best of our ability.