New York state offers interest abatement for certain sales and use taxpayers affected by COVID-19
On March 20, New York Gov. Andrew Cuomo issued an Executive Order (No. 202.8) providing limited relief for certain sales and use tax filers due to the impact of the COVID-19 outbreak.
Under the Executive Order, the Tax Commissioner can abate interest on sales and use tax filings and remittances that were due March 20, 2020, for taxpayers who were unable to timely file and pay because of the COVID-19 virus.
The interest abatement relief is limited. According to Notice N-20-1 (March 2020), the relief applies to quarterly or annual sales tax filers, but does not apply to monthly filers or to participants in the Promptax program.
Further, the inability to timely file or pay must have been related to business disruption caused by the COVID-19 outbreak. The Notice offers the following example scenarios: a) A taxpayer was unable to meet its deadline because key employees were treated or suspected to have the virus; b) Records were unavailable because of the outbreak; c) A taxpayer’s business was subject to a closure order due to the virus; or d) A taxpayer’s tax practitioner was unable to complete necessary work in order to timely file as a result of the virus.
Taxpayers eligible for relief must file their returns and pay the amount due within 60 days of the due date.
Taxpayers can apply for relief by completing a form and submitting an online request through the Department of Taxation and Finance’s website. Taxpayers will be required to disclose their EIN, business name, and business address. The Department will otherwise consider requests for abatement on behalf of eligible taxpayers on a case-by-case basis.
What does CohnReznick think?You should continue to monitor individual states. As the situation resulting from the COVID-19 outbreak continues to evolve, we expect more states to adjust their due dates. The AICPA is maintaining an updated list of states that have provided relief. We recommend checking back frequently.
Subject matter expertise
JD, Principal, Practice Leader, State and Local Tax (SALT) Services
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