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Tax Law

SOL Situation: New York State, New York City Administrative Tax Tribunals Differ on Tolling Statutes of Limitations

New York State and City taxpayers should be aware that, at least publicly, State and City administrative bodies have taken different approaches regarding the applicability of Executive Orders tolling statutes of limitations.

Almost one month ago, New York Governor Andrew Cuomo issued Executive Order No. 202.8, which referenced a directive of the Chief Judge of the State to limit court operations to essential matters during the pendency of the COVID-19 health crisis. In furtherance of that directive, Governor Cuomo ordered the tolling of deadlines “for the commencement, filing, or service of any legal action, notice, motion, or other process or proceeding, as prescribed by the procedural laws of the state” from March 20, 2020 until April 19, 2020. (See our prior Legal Alert.) On April 7, 2020, Governor Cuomo issued Executive Order No. 202.14, which suggests that tolling periods are extended through “through May 7, 2020.” On April 16, 2020, Governor Cuomo issued Executive Order No. 202.18, which further extended Executive Order No 202.14 “through May 16, 2020.”

While Executive Order No. 202.8 specifically referenced its application to various legal actions, administrative tax appeal deadlines were not explicitly covered.

New York State and New York City have separate administrative forums for the resolution of disputes between taxpayers and their respective tax departments. The New York City Tax Appeals Tribunal (“City Tribunal”) consistently provided guidance stating that these Executive Orders are applicable to its matters. The City Tribunal’s website was first updated to state the following:

Per the Governor’s Executive Order 202.8 issued on March 20, 2020 the time limitations relating to the “commencement, filing, or service” in connection with a New York City Tax Appeals Tribunal proceeding are, as of March 20, 2020, tolled until April 19, 2020.

Subsequent to the issuance of Executive Order No. 202.14, the City Tribunal updated its guidance to reference the new Executive Order and state that time limitations are tolled until May 7, 2020.

Public guidance from the State’s administrative forum, however, suggests that the Executive Orders are not applicable to its matters, and that its statutes of limitations will not be tolled. Guidance on the New York State Division of Tax Appeals’ (“New York DTA”) website has consistently stated the New York DTA does not have “the authority to waive statutory deadlines” and, therefore “any petition, exception, or request for an extension of time to file an exception must be filed . . . by the current statutory deadline.” While the New York DTA is working with reduced staff and taking other distancing measures, such as adjourning hearings, it appears that the New York DTA is operating under the assumption that the Executive Orders only apply to the tolling of deadlines in courts, and the New York DTA is an administrative body rather than a court.