Laws of the State of New York

disclosed in the return or in a statement attached to the return. The tax commission may waive all or any part of the addition to tax provided by this subsection on a showing by the taxpayer that there was reasonable cause for the understatement, or part thereof, and that the taxpayer acted in good faith.

§ 62. Section six hundred eighty-five of such law is amended by adding a new subsection (q) to read as follows:

(q) Frivolous tax returns.-If any individual files what purports to be a return of any tax imposed by this article but which does not contain information on which the substantial correctness of the self-assessment may be judged, or contains information that on its face indicates that the self-assessment is substantially incorrect; and such conduct is due to a position which is frivolous, or an intent (which appears on the purported return) to delay or impede the administration of this article, then such individual shall pay a penalty not exceeding five hundred dollars. This penalty shall be in addition to any other penalty provided by law.

§ 63. Section six hundred eighty-five of such law is amended by adding a new subsection (r) to read as follows:

(r) Aiding or assisting in the giving of fraudulent returns, reports, statements or other documents.-(1) Any person who, with the intent that tax be evaded, shall, for a fee or other compensation or as an incident to the performance of other services for which such person receives compensation, aid or assist in, or procure, counsel or advise the preparation or presentation under, or in connection with any matter arising under this chapter of any return, report, declaration, statement or other document which is fraudulent or false as to any material matter, or supply any false or fraudulent information, whether or not such falsity of fraud is with the knowledge or consent of the person authorized required to present such return, report, declaration, statement or other document shall pay a penalty not exceeding one thousand dollars.

(2) For purposes of paragraph one of this subsection, the term "procures" includes ordering (or otherwise causing) a subordinate to an act, and knowing of, and not attempting to prevent, participation by a subordinate in an act. The term "subordinate" means any other person (whether or not a director, officer, employee, or agent of the taxpayer involved) over whose activities the person has direction, supervision, or control.

(3) For purposes of paragraph one of this subsection, a person furnishing typing, reproducing, or other mechanical assistance with respect to a document shall not be treated as having aided or assisted in the preparation of such document by reason of such assistance.

(4) The penalty imposed by this subsection shall be in addition to any other penalty provided by law.

§ 64. Section six hundred eighty-five of such law is amended by adding a new subsection (s) to read as follows:

(s) False information with respect to withholding.-In addition to any criminal penalty provided by law, if any individual makes a statement under section six hundred seventy-one which results in a decrease in the amounts deducted and withheld under part five of this article, and as of the time such statement was made, there was no reasonable basis for such statement, such individual shall pay a penalty of five hundred dollars for such statement. The tax commission shall waive the penalty imposed under this subsection if the taxes imposed with respect to the individual under this article for the taxable year are equal to or less than the sum of the credits against such taxes allowed by this article, and the payments of estimated tax which are considered payments on account of such taxes.

§ 65. Subsection (e) of section six hundred eighty-nine of such law, as added by chapter ten hundred eleven of the laws of nineteen hundred sixty-two and paragraph three as amended by chapter six hundred seven of the laws of nineteen hundred seventy-eight, is amended to read as follows:

(e) Burden of proof. In any case before the tax commission under this article, the burden of proof shall be upon the petitioner except for the following issues, as to which the burden of proof shall be upon the tax commission: petitioner has been guilty of fraud with intent to

(1) whether

evade tax;

(2) whether the petitioner is liable as the transferee of property of a taxpayer, but not to show that the taxpayer was liable for the tax; [and]

(4) whether any person is liable for a penalty under subsection (q) or (r) of section six hundred eighty-five of this article.

§ 66. Subsections (d) and (f) of section six hundred ninety-two of such law, as added by chapter one thousand eleven of the laws of nineteen hundred sixty-two, are amended to read as follows:

(d) Copy of warrant to be filed and lien to be created. -Any sheriff or officer or employee who receives a warrant under subsection (c) shall within five days thereafter file a copy with the clerk of the appropriate county. The clerk shall thereupon enter in the judgment docket, the column for judgment debtors, the name of the taxpayer mentioned in the warrant, and in appropriate columns the tax or other amounts for which the warrant is issued and the date when such copy is filed; and such amount shall thereupon be a [binding] lien upon the title to and interest in real, personal and other property of the taxpayer [to the same extent as other judgments duly docketed in the office of such clerk. Such lien shall not apply to personal property unless such warrant is filed in the department of state.

(f) Execution. -The sheriff or officer or employee shall thereupon proceed upon the [judgment] warrant in all respects, with like effect, and in the same manner prescribed by law in respect to executions issued against property upon judgments of a court of record, and a sheriff shall be entitled to the same fees for his services in executing the warrant, to be collected in the same manner. An officer or employee the department of taxation and finance may proceed in any county or counties of this state and shall have all the powers of execution conferred by law upon sheriffs, but shall be entitled to no fee or compensation in excess of actual expenses paid in connection with the execution of the warrant.

§ 67. Paragraphs one and four of subsection (a) of section one thousand eighty-five of such law, as amended by chapter one thousand five of the laws of nineteen hundred seventy, are amended as follows:

(1) Failure to file return. -(A) In case of failure to file a return under article nine, nine-a, nine-b or nine-c on or before the prescribed date (determined with regard to any extension of time for filing), unless it is shown that such failure is due to reasonable cause and not due to willful neglect, there shall be added to the amount required to be shown as tax on such return five percent of the amount of such tax if the failure is for not more than one month, with an additional five percent for each additional month or fraction thereof during which such failure continues, not exceeding twenty-five percent in the aggregate. [For this purpose, the amount of tax required to be shown on the return shall be reduced by the amount of any part of the tax which is paid on or before the date prescribed for payment of the tax and by the amount of any credit against the tax which may be claimed upon the return. ]

(B) In the case of a failure to file a return of tax within sixty days of the date prescribed for filing of such return (determined with regard to any extension of time for filing), unless it is shown that such failure is due to reasonable cause and not due to willful neglect, the addition to tax hereunder shall not be less than the lesser of one hundred dollars or one hundred percent of the amount required to as tax on such return.

be shown

(C) For purposes of this paragraph, the amount of tax required to be shown on the return shall be reduced by the amount of any part of the tax which is paid on or before the date prescribed for payment of the tax and by the amount of any credit against the tax which may be claimed upon the return.

(4) Limitations on additions.

(A) With respect to any return, the amount of the addition under paragraph one of this subsection shall be reduced by the amount of the addition under paragraph two of this subsection for any month to which an EXPLANATION-Matter in italics is new; matter in brackets [ ] is old law

addition applies under both paragraphs one and two. In any case described in subparagraph (B) of paragraph one of this subsection, the amount of the addition under such paragraph one shall not be reduced below the amount provided in such subparagraph.

(B) With respect to any return, the maximum amount of the addition permitted under paragraph three of this subsection shall be reduced by the amount of the addition under paragraph one of this subsection (determined without regard to subparagraph (B) of such paragraph one) which is attributable to the tax for which the notice and demand is made and which is not paid within ten days of such notice and demand.

§ 68. Subsection (b) of section one thousand eighty-five of such law, as added by chapter one hundred eighty-eight of the laws of nineteen hundred sixty-four, is amended to read as follows:

(b) Deficiency due to negligence. -(1) If any part of a deficiency is due to negligence or intentional disregard of this article or article nine, nine-a, nine-b or nine-c, or rules or regulations thereunder (but without intent to defraud), there shall be added to the tax an amount equal to five percent of the deficiency.

(2) There shall be added to the tax (in addition to the amount determined under paragraph one of this subsection) an amount equal to fifty percent of the interest payable under section one thousand eighty-four with respect to the portion of the underpayment described in such paragraph one which is attributable to the negligence or intentional disregard referred to in such paragraph one, for the period beginning on the last date prescribed by law for payment of such underpayment (determined without regard to any extension) and ending on the date of the assessment of the tax (or, if earlier, the date of the payment of the tax). (3) If any payment is shown on a return made by a payor with respect to dividends, patronage dividends and interest under subsection (a) of section six thousand forty-two, subsection (a) of section six thousand forty-four or subsection (a) of section six thousand forty-nine of the internal revenue code of nineteen hundred fifty-four, respectively, and the payee fails to include any portion of such payment in gross income, as that term is defined in paragraph one of subsection (d) of section one thousand eighty-three, any portion of an underpayment attributable to such failure shall be treated, for purposes of this subsection, as due to negligence in the absence of clear and convincing evidence to the contrary. If any penalty is imposed under this subsection by reason of the preceding sentence, the amount of the penalty imposed by paragraph one of this subsection shall be five percent of the portion of the underpayment which is attributable to the failure described in the preced

ing sentencbsection (f) of section one thousand eighty-five of such law,

as added by chapter one hundred eighty-eight of the laws of nineteen hundred sixty-four and as relettered by chapter fifteen of the laws of nineteen hundred eighty-three, is amended to read as follows:

(f) Deficiency due to fraud.-(1) If any part of a deficiency is due to fraud, there shall be added to the tax an amount equal to fifty percent of the deficiency. [This amount]

(3) The addition to tax under this subsection shall be in lieu of any other addition to tax imposed by subsection (a) or (b).

§ 70. Subsection (j) of section one thousand eighty-five of such law, as amended by chapter fifteen of the laws of nineteen hundred eightythree, is amended to read as follows:

(j) Person defined. -For purposes of [subsection] subsections (g) and (1), the term person includes an individual, corporation or partnership or an officer or employee of any corporation (including a dissolved corporation), or a member or employee of any partnership, who as such officer, employee, or member is under a duty to perform the act in respect of which the violation occurs.

$71. Subsection (h) of section one thousand eighty-five of such law, as amended by chapter fifteen of the laws of nineteen hundred eightythree, is amended to read as follows:

(h) Additions treated as tax. -The additions to tax and penalties provided by this section shall be paid upon notice and demand and shall be assessed, collected and paid in the same manner as taxes, and any reference in this article to tax imposed by article nine, nine-a, nine-b or nine-c shall be deemed also to refer to the additions to tax and penalties provided by this section. For purposes of section one

thousand eighty-one, this subsection shall not apply to

(1) any addition to tax under subsection (a) except as to that portion attributable to a deficiency;

(2) any addition to tax under subsection (c); and

any additional [penalty] penalties under [subsection] subsections (g) and (1).

§ 72. Subsection (k) of section one thousand eighty-five of such law, as added by chapter fifteen of the laws of nineteen hundred eightythree, is amended to read as follows:

(k) Substantial understatement of liability.-If there is a substantial understatement of tax for any taxable year, there shall be added to the tax an amount equal to ten percent of the amount of any underpayment attributable to such understatement. For purposes of this subsection, there is a substantial understatement of tax for any taxable year if the amount of the understatement for the taxable year exceeds the greater of ten percent of the tax required to be shown on the return for the taxable year[,] or [ten] five thousand dollars [except that for an electing small business corporation as defined in section thirteen hundred seventy-one of the internal revenue code a substantial understatement exists if the amount of the understatement exceeds ten percent of the tax or five thousand dollars]. For purposes of the preceding sentence, the term "understatement" means the excess of the amount of the tax required to be shown on the return for the taxable year, over the amount of the tax imposed which is shown on the return. The amount of the understatement under the preceding sentence shall be reduced by that portion of the understatement which is attributable to the tax treatment of any item by the taxpayer if there is or was substantial authority for such treatment, or any item with respect to which the relevant facts affecting the item's tax treatment are adequately disclosed in the return or in a statement attached to the return. The tax commission may waive all or any part of the addition to tax provided by this section on a showing by the taxpayer that there was reasonable cause for the understatement (or part thereof) and that the taxpayer acted in good faith. § 73. Section one thousand eighty-five of such law is amended by adding a new subsection (1) to read as follows:

(1) Aiding or assisting in the giving of fraudulent returns, reports, statements or other documents.-(1) Any person who, with the intent that tax be evaded, shall, for a fee or other compensation or as an incident to the performance of other services for which such person receives compensation, aid or assist in, or procure, counsel, or advise the preparation or presentation under, or in connection with any matter arising under this chapter of any return, report, declaration, statement or other document which is fraudulent or false as to any material matter, or supply any false or fraudulent information, whether or not such falsity of fraud is with the knowledge or consent of the person authorized required to present such return, report, declaration, statement or other document shall pay a penalty not exceeding ten thousand dollars.

(4) The penalty imposed by this subsection shall be in addition to any other penalty provided by law.

§ 74. Subsection (e) of section one thousand eighty-nine of such law, as added by chapter one hundred eighty-eight of the laws of nineteen hundred sixty-four and paragraph three as amended by chapter fifty-five EXPLANATION-Matter in italics is new; matter in brackets [ ] is old law

of the laws of nineteen hundred eighty-two, follows:

is amended to read as

(e) Burden of proof. -In any case before the tax commission under this article, the burden of proof shall be upon the petitioner except for the following issues, as to which the burden of proof shall be upon the tax commission: petitioner has been guilty of fraud with intent to

(1) whether

evade tax;

(2) whether the petitioner is liable as the transferee of property of a taxpayer, but not to show that the taxpayer was liable for the tax; [and]

(3) whether the petitioner is liable for any increase in a deficiency where such increase is asserted initially after a notice of deficiency was mailed and a petition under this section filed, unless such increase in deficiency is the result of an increase or decrease in federal taxable income or federal tax or a federal change or correction or renegotiation, or computation or recomputation of tax, which is treated in the same manner as if it were a deficiency for federal income tax purposes, required to be reported under subdivision three of section two hundred eleven, or under section two hundred nineteen-bb, or under section two hundred nineteen-zz, and of which increase, decrease, change or correction or renegotiation, or computation or recomputation, the tax commission had no notice at the time it mailed the notice of deficiency; and (4) whether any person is liable for a penalty under subsection (1) of section one thousand eighty-five.

§ 75. Subsections (d) and (f) of section one thousand ninety-two of such law, as added by chapter one hundred eighty-eight of the laws of nineteen hundred sixty-four, are amended to read as follows:

(d) Copy of warrant to be filed and lien to be created. -Any sheriff or officer or employee who receives a warrant under subsection (c) shall within five days thereafter file a copy with the clerk of the appropriate county. The clerk shall thereupon enter in the judgment docket, the column for judgment debtors, the name of the taxpayer mentioned in the warrant, and in appropriate columns the tax or other amounts for which the warrant is issued and the date when such copy is filed; and such amount shall thereupon be a [binding] lien upon the title to and interest in real, personal and other property of the taxpayer [to the same extent as other judgments duly docketed in the office of such clerk]. Such lien shall not apply to personal property unless such warrant is filed in the department of state.

(f) Execution. The sheriff or officer or employee shall thereupon proceed upon the [judgment] warrant in all respects, with like effect, and in the same manner prescribed by law in respect to executions issued against property upon judgments of a court of record, and a sheriff shall be entitled to the same fees for his services in executing the warrant, to be collected in the same manner. An officer or employee the department of taxation and finance may proceed in any county or counties of this state and shall have all the powers of execution conferred by law upon sheriffs, but shall be entitled to no fee or compensation in excess of actual expenses paid in connection with the execution of the warrant.

§ 76. Subparagraph (ii) of paragraph four of subdivision (b) of section eleven hundred one of such law, as amended by chapter nine hundred thirty of the laws of nineteen hundred eighty-two, is amended to read as follows:

(ii) Notwithstanding the provisions of subparagraph (i) of this paragraph, a sale of automotive fuel by a distributor is deemed to be retail sale, except for a sale of automotive fuel by a distributor to a purchaser duly registered with or licensed by the taxing authorities of another state as a distributor of or dealer in automotive fuel therein, for immediate exportation from the state into such other state, provided the distributor making such sale complies with all regulations of the tax commission relating thereto. For purposes of this subparagraph and subparagraph (iii) of this paragraph and sections eleven hundred eleven, eleven hundred nineteen, eleven hundred thirty-two, eleven hundred thirty-four, eleven hundred thirty-five [and], eleven hundred thirty-six and eighteen hundred seventeen of this chapter, the following terms shall have the following meanings:

(A) "Automotive fuel" means diesel motor fuel as defined in section two hundred eighty-two-a of this chapter, other than kerosene or propane used for residential purposes, or motor fuel as defined in subdivision two of section two hundred eighty-two of this chapter. The phrase "used

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Laws of the State of New York, 2권,파트 54-392