Albany, NY - April 16, 2014 - Governor Andrew M. Cuomo today announced that the State Department of Taxation and Finance’s wide array of tax enforcement programs collected $3.9 billion in the past year, helping ensure that honest New York taxpayers are protected and tax evaders are held responsible for their fair share. The $3.9 billion in evaded taxes collected is an increase of approximately $200 million compared to the prior year, a five percent increase.
“The vast majority of New Yorkers file their taxes honestly, and they should not have to pick up the tab for tax scofflaws who attempt to cheat their way out of paying their fair share,” Governor Cuomo said. “This administration has worked hard to crack down on tax evasion and put tools in place that enable the State Tax Department to better enforce the law. With nearly $4 billion collected over the past year, these stepped up enforcement measures are working to help protect New York taxpayers.”
Each year, 96% of the $87 billion in state and local taxes collected by the New York State Tax Department is remitted voluntarily. The Department’s enforcement programs – criminal investigations, audit and collections - are responsible for collecting the additional 4%.
Of the $3.9 billion in evaded taxes collected during the 2013-14 fiscal year, $800 million was collected by the Tax Department on behalf of local governments. The remaining $3.1 billion funds New York State programs.
Breaking down the $3.9 billion
Criminal investigations and audits resulted in $1.75 billion in increased tax collections. For each tax evasion case, the Department reviews the specific facts to determine whether to pursue it through criminal charges or civil audits. To prosecute cases, the Tax Department’s Criminal Investigations Division works closely with federal and local law enforcement agencies.
Collection activities resulted in $1.65 billion in state and local funds. The Department works closely with taxpayers to resolve tax debt, and establishes payment arrangements where a debt can’t be immediately resolved. When debts are outstanding for extended periods, the Department escalates its collection actions, including seizing financial assets and garnishing wages.
Enhancing this year’s collections was the new Driver License Suspension Program. The continuing program raised more than $46 million in state funds and nearly $15 million in local monies, exceeding estimates by more than 33%. As a result, more than 7,000 debtors with tax debts greater than $10,000 have paid their debt in full or begun making payment arrangements. More than 8,100 licenses have been suspended to date.
For the first time in the 15-year history of the STAR Program, taxpayers last year were required to confirm their eligibility for the Basic STAR exemption. As a result of the STAR Registration Program, more than 150,000 ineligible STAR recipients have been eliminated, saving New York taxpayers more than $100 million annually.
The Tax Department also stopped 255,000 fraudulent or erroneous refunds for an additional $413 million in savings to taxpayers.
The Tax Department investigates referrals of tax fraud from taxpayers and other law enforcement agencies. If you suspect an individual or business of tax fraud, call 518-457-0578 or file an online referral.