§ 697. General powers of tax commission.--(a) General.--The tax
commission shall administer and enforce the tax imposed by this article
and it is authorized to make such rules and regulations, and to require
such facts and information to be reported, as it may deem necessary to
enforce the provisions of this article. The tax commission may divide
the state into districts in each of which a branch office may be
maintained by it, but in no case shall a county be divided in forming a
district.

(b) Examination of books and witnesses.--(1) The tax commission for
the purpose of ascertaining the correctness of any return, or for the
purpose of making an estimate of taxable income of any person, shall
have power to examine or to cause to have examined, by any agent or
representative designated by it for that purpose, any books, papers,
records or memoranda bearing upon the matters required to be included in
the return, and may require the attendance of the person rendering the
return or any officer or employee of such person, or the attendance of
any other person having knowledge in the premises, and may take
testimony and require proof material for its information, with power to
administer oaths to such person or persons.

(2) The tax commission may take any action under paragraph one of this
subdivision to inquire into the commission of an offense connected with
the administration or enforcement of this article, provided, however,
that notwithstanding the provisions of section one hundred seventy-four
of this chapter no such action shall be taken when a referral by the
department or the tax commission to the attorney general, a district
attorney or any other prosecutorial agency is in effect. Provided,
however, the tax commission shall have power, during the period when
such referral is in effect, to examine or to cause to have examined, by
any agent or representative designated by it for that purpose, any
books, papers, records or memoranda bearing upon the matters required to
be included in the return, where such books, papers, records or
memoranda are in its possession, or where such books, papers, records or
memoranda are in the possession of the attorney general, district
attorney or other prosecutorial agency to which such referral is made.

(c) Abatement authority.--The tax commission, of its own motion, may
abate any small unpaid balance of an assessment of income tax, or any
liability in respect thereof, if the tax commission determines under
uniform rules prescribed by it that the administration and collection
costs involved would not warrant collection of the amount due. It may
also abate, of its own motion, the unpaid portion of the assessment of
any tax or any liability in respect thereof, which is excessive in
amount, or is assessed after the expiration of the period of limitation
properly applicable thereto, or is erroneously or illegally assessed. No
claim for abatement under this subsection shall be filed by a taxpayer.

(d) Special refund authority.--Where no questions of fact or law are
involved and it appears from the records of the tax commission that any
moneys have been erroneously or illegally collected from any taxpayer or
other person, or paid by such taxpayer or other person under a mistake
of facts, pursuant to the provisions of this article, the tax commission
at any time, without regard to any period of limitations, shall have the
power, upon making a record of its reasons therefor in writing, to cause
such moneys so paid and being erroneously and illegally held to be
refunded and to issue therefor its certificate to the comptroller.

(e) Secrecy requirement and penalties for violation.--(1) Except in
accordance with proper judicial order or as otherwise provided by law,
it shall be unlawful for the commissioner, any officer or employee of
the department, any person engaged or retained by such department on an
independent contract basis, any depositary to which any return may be
delivered as provided in subsection (h) or (i) of this section, any
officer or employee of such depositary, or any person who, pursuant to
this section, is permitted to inspect any report or return or to whom a
copy, an abstract or a portion of any report or return is furnished, or
to whom any information contained in any report or return is furnished,
to divulge or make known in any manner the amount of income or any
particulars set forth or disclosed in any report or return required
under this article, under section one hundred seventy-one-a or section
one hundred seventy-one-h of this chapter, or under this article and
article eighteen of the labor law.

(2) The officers charged with the custody of such reports and returns
shall not be required to produce any of them or evidence of anything
contained in them in any action or proceeding in any court, except on
behalf of the commissioner in an action or proceeding under the
provisions of this chapter or in any other action or proceeding
involving the collection of a tax due under this chapter to which the
state or the commissioner is a party or a claimant, or on behalf of any
party to any action or proceeding under the provisions of this article,
or under the provisions of this article and article eighteen of the
labor law, when the reports, returns or facts shown thereby are directly
involved in such action or proceeding, in any of which events the court
may require the production of, and may admit in evidence, so much of
said reports, returns or of the facts shown thereby, as are pertinent to
the action or proceeding and no more. The commissioner may,
nevertheless, publish a copy or a summary of any decision rendered after
the hearing required under section six hundred eighty-nine of this
article.

(3) Nothing herein shall be construed to prohibit the department, its
officers or employees from furnishing information to the office of
temporary and disability assistance relating to the payment of the
credit for certain household and dependent care services necessary for
gainful employment under subsection (c) of section six hundred six of
this article and the earned income credit under subsection (d) of
section six hundred six of this article and the enhanced earned income
credit under subsection (d-1) of section six hundred six of this
article, or pursuant to a local law enacted by a city having a
population of one million or more pursuant to subsection (f) of section
thirteen hundred ten of this chapter, only to the extent necessary to
calculate qualified state expenditures under paragraph seven of
subdivision (a) of section four hundred nine of the federal social
security act or to document the proper expenditure of federal temporary
assistance for needy families funds under section four hundred three of
such act. The office of temporary and disability assistance may
redisclose such information to the United States department of health
and human services only to the extent necessary to calculate such
qualified state expenditures or to document the proper expenditure of
such federal temporary assistance for needy families funds. Nothing
herein shall be construed to prohibit the delivery by the commissioner
to a commissioner of jurors, appointed pursuant to section five hundred
four of the judiciary law, or, in counties within cities having a
population of one million or more, to the county clerk of such county,
or to the clerk of the court or jury administrator of a United States
district court appointed pursuant to title twenty-eight of the United
States Code, section 1836(b)(2), of a mailing list of individuals to
whom income tax forms are mailed by the commissioner for the sole
purpose of compiling a list of prospective jurors as provided in article
sixteen of the judiciary law or title twenty-eight of the United States
Code. Provided, however, such delivery shall only be made pursuant to an
order of the chief administrator of the courts, appointed pursuant to
section two hundred ten of the judiciary law or an order of a chief
judge of any United States district court in New York State. No such
order may be issued unless such chief administrator or chief judge of
such United States district court is satisfied that such mailing list is
needed to compile a proper list of prospective jurors for the county or
such United States district court for which such order is sought and
that, in view of the responsibilities imposed by the various laws of the
state on the department, it is reasonable to require the commissioner to
furnish such list. Such order shall provide that such list shall be used
for the sole purpose of compiling a list of prospective jurors and that
such commissioner of jurors, or such county clerk, or clerk of the court
or jury administrator of such United States district court shall take
all necessary steps to insure that the list is kept confidential and
that there is no unauthorized use or disclosure of such list.
Furthermore, nothing herein shall be construed to prohibit the delivery
to a taxpayer or his or her duly authorized representative of a
certified copy of any return or report filed in connection with his or
her tax or to prohibit the publication of statistics so classified as to
prevent the identification of particular reports or returns and the
items thereof, or the inspection by the attorney general or other legal
representatives of the state of the report or return of any taxpayer or
of any employer filed under section one hundred seventy-one-h of this
chapter, where such taxpayer or employer shall bring action to set aside
or review the tax based thereon, or against whom an action or proceeding
under this chapter or under this chapter and article eighteen of the
labor law has been recommended by the commissioner, the commissioner of
labor with respect to unemployment insurance matters, or the attorney
general or has been instituted, or the inspection of the reports or
returns required under this article by the comptroller or duly
designated officer or employee of the state department of audit and
control, for purposes of the audit of a refund of any tax paid by a
taxpayer under this article, or the furnishing to the state department
of labor of unemployment insurance information obtained or derived from
quarterly combined withholding, wage reporting and unemployment
insurance returns required to be filed by employers pursuant to
paragraph four of subsection (a) of section six hundred seventy-four of
this article, for purposes of administration of such department's
unemployment insurance program, employment services program, federal and
state employment and training programs, employment statistics and labor
market information programs, worker protection programs, federal
programs for which the department has administrative responsibility or
for other purposes deemed appropriate by the commissioner of labor
consistent with the provisions of the labor law, and redisclosure of
such information in accordance with the provisions of sections five
hundred thirty-six and five hundred thirty-seven of the labor law or any
other applicable law, or the furnishing to the state office of temporary
and disability assistance of information obtained or derived from New
York state personal income tax returns as described in paragraph (b) of
subdivision two of section one hundred seventy-one-g of this chapter for
the purpose of reviewing support orders enforced pursuant to title six-A
of article three of the social services law to aid in the determination
of whether such orders should be adjusted, or the furnishing of
information obtained from the reports required to be submitted by
employers regarding newly hired or re-hired employees pursuant to
section one hundred seventy-one-h of this chapter to the state office of
temporary and disability assistance, the state department of health, the
state department of labor and the workers' compensation board for
purposes of administration of the child support enforcement program,
verification of individuals' eligibility for one or more of the programs
specified in subsection (b) of section eleven hundred thirty-seven of
the federal social security act and for other public assistance programs
authorized by state law, and administration of the state's employment
security and workers' compensation programs, and to the national
directory of new hires established pursuant to section four hundred
fifty-three-A of the federal social security act for the purposes
specified in such section, or the furnishing to the state office of
temporary and disability assistance of the amount of an overpayment of
income tax and interest thereon certified to the comptroller to be
credited against past-due support pursuant to section one hundred
seventy-one-c of this chapter and of the name and social security number
of the taxpayer who made such overpayment, or the disclosing to the
commissioner of finance of the city of New York, pursuant to section one
hundred seventy-one-l of this chapter, of the amount of an overpayment
and interest thereon certified to the comptroller to be credited against
a city of New York tax warrant judgment debt and of the name and social
security number of the taxpayer who made such overpayment, or the
furnishing to the New York state higher education services corporation
of the amount of an overpayment of income tax and interest thereon
certified to the comptroller to be credited against the amount of a
default in repayment of any education loan debt, including judgments,
owed to the federal or New York state government that is being collected
by the New York state higher education services corporation, and of the
name and social security number of the taxpayer who made such
overpayment, or the furnishing to the state department of health of the
information required by paragraph (f) of subdivision two and subdivision
two-a of section two thousand five hundred eleven of the public health
law and by subdivision eight of section three hundred sixty-six-a of the
social services law, or the furnishing to the state university of New
York or the city university of New York respectively or the attorney
general on behalf of such state or city university the amount of an
overpayment of income tax and interest thereon certified to the
comptroller to be credited against the amount of a default in repayment
of a state university loan pursuant to section one hundred seventy-one-e
of this chapter and of the name and social security number of the
taxpayer who made such overpayment, or the disclosing to a state agency,
pursuant to section one hundred seventy-one-f of this chapter, of the
amount of an overpayment and interest thereon certified to the
comptroller to be credited against a past-due legally enforceable debt
owed to such agency and of the name and social security number of the
taxpayer who made such overpayment, or the furnishing of employee and
employer information obtained through the wage reporting system,
pursuant to section one hundred seventy-one-a of this chapter, as added
by chapter five hundred forty-five of the laws of nineteen hundred
seventy-eight, to the state office of temporary and disability
assistance, the department of health or to the state office of the
medicaid inspector general for the purpose of verifying eligibility for
and entitlement to amounts of benefits under the social services law or
similar law of another jurisdiction, locating absent parents or other
persons legally responsible for the support of applicants for or
recipients of public assistance and care under the social services law
and persons legally responsible for the support of a recipient of
services under section one hundred eleven-g of the social services law
and, in appropriate cases, establishing support obligations pursuant to
the social services law and the family court act or similar provision of
law of another jurisdiction for the purpose of evaluating the effect on
earnings of participation in employment, training or other programs
designed to promote self-sufficiency authorized pursuant to the social
services law by current recipients of public assistance and care and by
former applicants and recipients of public assistance and care, (except
that with regard to former recipients, information which relates to a
particular former recipient shall be provided with client identifying
data deleted), to the state office of temporary and disability
assistance for the purpose of determining the eligibility of any child
in the custody, care and custody or custody and guardianship of a local
social services district or of the office of children and family
services for federal payments for foster care and adoption assistance
pursuant to the provisions of title IV-E of the federal social security
act by providing information with respect to the parents, the
stepparents, the child and the siblings of the child who were living in
the same household as such child during the month that the court
proceedings leading to the child's removal from the household were
initiated, or the written instrument transferring care and custody of
the child pursuant to the provisions of section three hundred
fifty-eight-a or three hundred eighty-four-a of the social services law
was signed, provided however that the office of temporary and disability
assistance shall only use the information obtained pursuant to this
subdivision for the purpose of determining the eligibility of such child
for federal payments for foster care and adoption assistance pursuant to
the provisions of title IV-E of the federal social security act, and to
the state department of labor, or other individuals designated by the
commissioner of labor, for the purpose of the administration of such
department's unemployment insurance program, employment services
program, federal and state employment and training programs, employment
statistics and labor market information programs, worker protection
programs, federal programs for which the department has administrative
responsibility or for other purposes deemed appropriate by the
commissioner of labor consistent with the provisions of the labor law,
and redisclosure of such information in accordance with the provisions
of sections five hundred thirty-six and five hundred thirty-seven of the
labor law, or the furnishing of information, which is obtained from the
wage reporting system operated pursuant to section one hundred
seventy-one-a of this chapter, as added by chapter five hundred
forty-five of the laws of nineteen hundred seventy-eight, to the state
office of temporary and disability assistance so that it may furnish
such information to public agencies of other jurisdictions with which
the state office of temporary and disability assistance has an agreement
pursuant to paragraph (h) or (i) of subdivision three of section twenty
of the social services law, and to the state office of temporary and
disability assistance for the purpose of fulfilling obligations and
responsibilities otherwise incumbent upon the state department of labor,
under section one hundred twenty-four of the federal family support act
of nineteen hundred eighty-eight, by giving the federal parent locator
service, maintained by the federal department of health and human
services, prompt access to such information as required by such act, or
to the state department of health to verify eligibility under the child
health insurance plan pursuant to subdivisions two and two-a of section
two thousand five hundred eleven of the public health law, to verify
eligibility under the medical assistance and family health plus programs
pursuant to subdivision eight of section three hundred sixty-six-a of
the social services law, and to verify eligibility for the program for
elderly pharmaceutical insurance coverage under title three of article
two of the elder law, or to the office of vocational and educational
services for individuals with disabilities of the education department,
the commission for the blind and any other state vocational
rehabilitation agency, for purposes of obtaining reimbursement from the
federal social security administration for expenditures made by such
office, commission or agency on behalf of disabled individuals who have
achieved economic self-sufficiency or to the higher education services
corporation for the purpose of assisting the corporation in default
prevention and default collection of education loan debt, including
judgments, owed to the federal or New York state government; provided,
however, that such information shall be limited to the names, social
security numbers, home and/or business addresses, and employer names of
defaulted or delinquent student loan borrowers, or to the office of the
state comptroller for purposes of verifying the income of a retired
member of a retirement system or pension plan administered by the state
or any of its political subdivisions who returns to public employment.

Provided, however, that with respect to employee information the
office of temporary and disability assistance shall only be furnished
with the names, social security account numbers and gross wages of those
employees who are (A) applicants for or recipients of benefits under the
social services law, or similar provision of law of another jurisdiction
(pursuant to an agreement under subdivision three of section twenty of
the social services law) or, (B) absent parents or other persons legally
responsible for the support of applicants for or recipients of public
assistance and care under the social services law or similar provision
of law of another jurisdiction (pursuant to an agreement under
subdivision three of section twenty of the social services law), or (C)
persons legally responsible for the support of a recipient of services
under section one hundred eleven-g of the social services law or similar
provision of law of another jurisdiction (pursuant to an agreement under
subdivision three of section twenty of the social services law), or (D)
employees about whom wage reporting system information is being
furnished to public agencies of other jurisdictions, with which the
state office of temporary and disability assistance has an agreement
pursuant to paragraph (h) or (i) of subdivision three of section twenty
of the social services law, or (E) employees about whom wage reporting
system information is being furnished to the federal parent locator
service, maintained by the federal department of health and human
services, for the purpose of enabling the state office of temporary and
disability assistance to fulfill obligations and responsibilities
otherwise incumbent upon the state department of labor, under section
one hundred twenty-four of the federal family support act of nineteen
hundred eighty-eight, and, only if, the office of temporary and
disability assistance certifies to the commissioner that such persons
are such applicants, recipients, absent parents or persons legally
responsible for support or persons about whom information has been
requested by a public agency of another jurisdiction or by the federal
parent locator service and further certifies that in the case of
information requested under agreements with other jurisdictions entered
into pursuant to subdivision three of section twenty of the social
services law, that such request is in compliance with any applicable
federal law. Provided, further, that where the office of temporary and
disability assistance requests employee information for the purpose of
evaluating the effects on earnings of participation in employment,
training or other programs designed to promote self-sufficiency
authorized pursuant to the social services law, the office of temporary
and disability assistance shall only be furnished with the quarterly
gross wages (excluding any reference to the name, social security number
or any other information which could be used to identify any employee or
the name or identification number of any employer) paid to employees who
are former applicants for or recipients of public assistance and care
and who are so certified to the commissioner by the commissioner of the
office of temporary and disability assistance. Provided, further, that
with respect to employee information, the department of health shall
only be furnished with the information required pursuant to the
provisions of paragraph (f) of subdivision two and subdivision two-a of
section two thousand five hundred eleven of the public health law and
subdivision eight of section three hundred sixty-six-a of the social
services law, with respect to those individuals whose eligibility under
the child health insurance plan, medical assistance program, and family
health plus program is to be determined pursuant to such provisions and
with respect to those members of any such individual's household whose
income affects such individual's eligibility and who are so certified to
the commissioner or by the department of health. Provided, further, that
wage reporting information shall be furnished to the office of
vocational and educational services for individuals with disabilities of
the education department, the commission for the blind and any other
state vocational rehabilitation agency only if such office, commission
or agency, as applicable, certifies to the commissioner that such
information is necessary to obtain reimbursement from the federal social
security administration for expenditures made on behalf of disabled
individuals who have achieved self-sufficiency. Reports and returns
shall be preserved for three years and thereafter until the commissioner
orders them to be destroyed.

(3-a) Notwithstanding the provisions of paragraph one of this
subsection, the commissioner may disclose to a taxpayer or a taxpayer's
related member, as defined in subsection (r) of section six hundred
twelve of this article, information relating to any royalty paid,
incurred or received by such taxpayer or related member to or from the
other, including the treatment of such payments by the taxpayer or the
related member in any report or return transmitted to the commissioner
under this chapter.

(4) (A) Any officer or employee of the state who willfully violates
the provisions of this subsection shall be dismissed from office and be
incapable of holding any public office in this state for a period of
five years thereafter.

(B) Cross-reference: For criminal penalties, see article thirty-seven
of this chapter.

(f) Cooperation with the United States and other states.--
Notwithstanding the provisions of subsection (e), the tax commission may
permit the secretary of the treasury of the United States or his
delegates, or the proper tax officer of any state imposing an income tax
upon the incomes of individuals, or the authorized representative of
either such officer, to inspect any return filed under this article, or
may furnish to such officer or his authorized representative an abstract
of any such return or supply him with information concerning an item
contained in any such return, or disclosed by any investigation of tax
liability under this article, but such permission shall be granted or
such information furnished to such officer or his representative only if
the laws of the United States or of such other state, as the case may
be, grant substantially similar privileges to the commission or officer
of this state charged with the administration of the tax imposed by this
article and such information is to be used for tax purposes only; and
provided further the commissioner of taxation and finance may furnish to
the commissioner of internal revenue or his authorized representative
such returns filed under this article and other tax information, as he
may consider proper, for use in court actions or proceedings under the
internal revenue code, whether civil or criminal, where a written
request therefor has been made to the commissioner of taxation and
finance by the secretary of the treasury of the United States or his
delegates, provided the laws of the United States grant substantially
similar powers to the secretary of the treasury of the United States or
his delegates. Where the commissioner of taxation and finance has so
authorized use of returns and other information in such actions or
proceedings, officers and employees of the department of taxation and
finance may testify in such actions or proceedings in respect to such
returns or other information.

(f-1) Cooperation with investigations by certain committees of the
United States Congress.--(1) Notwithstanding the provisions of
subsection (e) of this section, upon written request from the
chairperson of the committee on ways and means of the United States
House of Representatives, the chairperson of the committee on finance of
the United States Senate, or the chairperson of the joint committee on
taxation of the United States Congress, the commissioner shall furnish
such committee with any current or prior year reports or returns
specified in such request that were filed under this article by the
president of the United States, vice-president of the United States,
member of the United States Congress representing New York state, or any
person who served in or was employed by the executive branch of the
government of the United States on the executive staff of the president,
in the executive office of the president, or in an acting or confirmed
capacity in a position subject to confirmation by the United States
senate; or, in New York state: a statewide elected official, as defined
in paragraph (a) of subdivision one of section seventy-three-a of the
public officers law; a state officer or employee, as defined in
subparagraph (i) of paragraph (c) of subdivision one of such section
seventy-three-a; a political party chairperson, as defined in paragraph
(h) of subdivision one of such section seventy-three-a; a local elected
official, as defined in subdivisions one and two of section eight
hundred ten of the general municipal law; a person appointed, pursuant
to law, to serve due to vacancy or otherwise in the position of a local
elected official, as defined in subdivisions one and two of section
eight hundred ten of the general municipal law; a member of the state
legislature; or a judge or justice of the unified court system; provided
however that, prior to furnishing any report or return, the commissioner
shall redact any copy of a federal return (or portion thereof) attached
to, or any information on a federal return that is reflected on, such
report or return, and any social security numbers, account numbers and
residential address information.

(2) No reports or returns shall be furnished pursuant to this
subsection unless the chairperson of the requesting committee certifies
in writing that such reports or returns have been requested related to,
and in furtherance of, a legitimate task of the Congress, that the
requesting committee has made a written request to the United States
secretary of the treasury for related federal returns or return
information, pursuant to 26 U.S.C. Section 6103(f), and that if such
requested reports or returns are inspected by and/or submitted to
another committee, to the United States House of Representatives, or to
the United States Senate, then such inspection and/or submission shall
occur in a manner consistent with federal law as informed by the
requirements and procedures established in 26 U.S.C. Section 6103(f).

(g) Cooperation with the cities of the state of New York.
Notwithstanding the provisions of subsection (e), the tax commission may
permit the proper city officer of any city of the state of New York
imposing a personal income tax upon the incomes of residents, or an
unincorporated business income tax, or an earnings tax on nonresidents,
or the authorized representative of any such officer, to inspect any
return filed under this article, or article twenty-three (as such
article was in effect on or before December thirtieth, nineteen hundred
eighty-two), or may furnish to such officer or his authorized
representative an abstract of any such return or supply him with
information concerning an item contained in any such return, or
disclosed by any investigation of tax liability under this article or
article twenty-three (as such article was in effect on or before
December thirtieth, nineteen hundred eighty-two), but such permission
shall be granted or such information furnished to such officer or his
representative only if the local laws of such city grant substantially
similar privileges to the commission or officer of this state charged
with the administration of the tax imposed by this article and such
information is to be used for tax purposes only; and provided further
the commissioner of taxation and finance may furnish to such city
officer or the legal representative of such city such returns filed
under this article or article twenty-three (as such article was in
effect on or before December thirtieth, nineteen hundred eighty-two) and
other tax information, as he may consider proper, for use in court
actions or proceedings under such local law, whether civil or criminal,
where a written request therefor has been made to the commissioner of
taxation and finance by such city officer or his delegate, provided the
local law of such city grants substantially similar powers to such city
officer or his delegate. Where the commissioner of taxation and finance
has so authorized use of returns and other information in such actions
or proceedings, officers and employees of the department of taxation and
finance may testify in such actions or proceedings in respect to such
returns or other information.

(h) Withholding returns.--Notwithstanding the provisions of subsection
(e) of this section the tax commission in its discretion, when making
deposits, pursuant to section six hundred ninety-eight, of taxes
withheld by employers, may deliver to the depositary the withholding
returns filed by such employers as provided in section six hundred
seventy-four, for the purpose of insuring that all money so deposited
shall be correctly credited to taxpayers' accounts.

(i) Filing returns and making payments to depository banks.--
Notwithstanding the provisions of subsection (e) of this section, the
tax commission, in its discretion, may require or permit any or all
individuals, estates or trusts liable for any tax imposed by this
article, to make payments on account of estimated tax and payment of any
tax, penalty or interest imposed by this article to banks, banking
houses or trust companies designated by the tax commission and to file
reports and returns which such banks, banking houses or trust companies
as agents of the tax commission, in lieu of making any such payment to
the tax commission. However, the tax commission shall designate only
such banks, banking houses or trust companies as are or shall be
designated by the comptroller as depositories pursuant to section six
hundred ninety-eight.

(j) Authority to set interest rates.--(1) The commissioner shall set
the overpayment and underpayment rates of interest to be paid pursuant
to sections six hundred eighty-four, six hundred eighty-five and six
hundred eighty-eight of this part, but if no such rates of interest are
set, such overpayment rate shall be deemed to be set at six percent per
annum and such underpayment rate shall be deemed to be set at seven and
one-half percent per annum. Such rates shall be the rates prescribed in
paragraphs two and four of this subsection, but the underpayment rate
shall not be less than seven and one-half percent per annum. Any such
rates set by the commissioner shall apply to taxes, or any portion
thereof, which remain or become due or overpaid on or after the date on
which such rates become effective and shall apply only with respect to
interest computed or computable for periods or portions of periods
occurring in the period during which such rates are in effect.

(2) Rates of interest. (A) Overpayment rate. The overpayment rate of
interest set under this subsection shall be the sum of (i) the federal
short-term rate as provided under paragraph three of this subsection,
plus (ii) two percentage points.

(B) Underpayment rate. The underpayment rate of interest set under
this subsection shall be the sum of (i) the federal short-term rate as
provided under paragraph three of this subsection, plus (ii) five and
one-half percentage points.

(3) Federal short-term rate. For purposes of this subsection:

(A) The federal short-term rate for any month shall be the federal
short-term rate determined by the United States secretary of the
treasury during such month in accordance with subsection (d) of section
twelve hundred seventy-four of the internal revenue code for use in
connection with section six thousand six hundred twenty-one of the
internal revenue code. Any such rate shall be rounded to the nearest
full percent (or, if a multiple of one-half of one percent, such rate
shall be increased to the next highest full percent).

(B) Period during which rate applies.

(i) In general. Except as provided in clauses (ii) and (iii) of this
subparagraph, the federal short-term rate for the first month in each
calendar quarter shall apply during the first calendar quarter beginning
after such month.

(ii) Special rule for individual estimated tax. In determining the
addition to tax under subsection (c) of section six hundred eighty-five
for failure to pay estimated tax for any taxable year, the federal
short-term rate which applies during the third month following the
taxable year shall also apply during the first fifteen days of the
fourth month following such taxable year.

(iii) Special rule for the month of September, nineteen hundred
eighty-nine. The federal short-term rate for the month of April,
nineteen hundred eighty-nine shall apply with respect to setting the
rate of interest for the month of September, nineteen hundred
eighty-nine.

(4) Notwithstanding the provisions of paragraph two of this subsection
to the contrary, in the case of interest payable by an employer with
respect to income taxes required to be withheld and paid over by him
pursuant to the provisions of part five of this article and with respect
to interest payable to an employer pursuant to subsection (c) of section
six hundred eighty-six, the rates of interest prescribed by this section
shall be the overpayment and underpayment rates of interest prescribed
in paragraph two of subsection (e) of section one thousand ninety-six of
this chapter.

(5) In computing the amount of any interest required to be paid under
this article by the commissioner of taxation and finance or by the
taxpayer, or any other amount determined by reference to such amount of
interest, such interest and such amount shall be compounded daily. The
preceding sentence shall not apply for purposes of computing the amount
of any addition to tax for failure to pay estimated tax under subsection
(c) of section six hundred eighty-five.

(6) Publication of interest rates. The commissioner of taxation and
finance shall publish the interest rates set under this subsection on
the website of the department of taxation and finance. Immediately
following such publication, the commissioner shall cause such interest
rates to be published in the section for miscellaneous notices in the
state register and give other appropriate general notice of such
interest rates. The setting and publication of such interest rates shall
not be included within paragraph (a) of subdivision two of section one
hundred two of the state administrative procedure act relating to the
definition of a rule.

(7) Cross-reference. For provisions relating to the power of the
commissioner of taxation and finance to abate small amounts of interest,
see subsection (c) of this section.

(k) (1) For school aid payable in the school years nineteen hundred
eighty-five--eighty-six through nineteen hundred
ninety-three--ninety-four, notwithstanding the provisions of subsection
(e) of this section, the department or authorized vendor contracted by
the department shall furnish, as required pursuant to subdivision
twenty-fifth of section one hundred seventy-one of this chapter, to the
commissioner of education and school district superintendents of
identified school districts and district superintendents appointed
pursuant to section nineteen hundred fifty of the education law, having
an identified school district within their supervisory district, an
ordered listing, for such identified school districts participating in
the temporary school district address review validation and correction
process, of the permanent resident address of each taxpayer who has
filed a personal income tax return with the department with a school
district code which indicates that the taxpayer is a resident of such
school district at the close of the taxable year for which the return
was filed.

(2) For school aid payable in school years nineteen hundred
eighty-eight--eighty-nine through nineteen hundred
ninety-three--ninety-four, notwithstanding the provisions of subsection
(e) of this section, a receiver school district may review the ordered
listing wherein an identified school district that participated in the
temporary school district address review validation and correction
process identified personal income tax returns as belonging to such
receiver district. The information provided to a receiving district
pursuant to this subdivision and subdivision twenty-fifth of section one
hundred seventy-one of this chapter shall be used solely for the purpose
of verifying the legal residence and school district of a taxpayer whose
return was identified as belonging to a receiver school district by an
identified school district.

(4) Notwithstanding the provisions of subsection (e) of this section,
the department or an authorized vendor contracted by the department
shall furnish, as required pursuant to subdivision twenty-fifth of
section one hundred seventy-one of this chapter, to the superintendents
of schools of identified school districts and district superintendents
of schools appointed pursuant to section nineteen hundred fifty of the
education law, having an identified school district within their
supervisory district, an ordered listing, for such identified school
districts electing to participate in the appeals process for a limited
school district address review validation and correction process.

(5) The information provided pursuant to this section and subdivision
twenty-fifth of section one hundred seventy-one of this chapter shall be
used solely for the purpose of verifying the legal residence and school
district of a taxpayer in determining the distribution of state aid for
education and such information may only be disclosed by such
commissioner, superintendents and authorized vendor contracted by the
department for such purposes to employees of the state education
department, and to employees under the control of such superintendents.
In addition, notwithstanding the provisions of subsection (e) of this
section, the department may furnish to an authorized vendor contracted
by the department the permanent resident address and school code data
necessary for the implementation of the temporary school district
address review validation and correction process, the pilot computerized
address match and income verification project, or the permanent
computerized statewide school district address match and income
verification system pursuant to subdivision twenty-fifth of section one
hundred seventy-one of this chapter. Any violation of the provisions of
this section shall be punishable in the manner provided for in
subsection (e) of this section. Any information obtained by any agency
or person pursuant to the provisions of this section shall not be deemed
a "record", as defined in subdivision four of section eighty-six of the
public officers law.

(l) Exchange of information within the state department of labor. (1)
Notwithstanding any provision of law to the contrary, the state
department of labor shall furnish to the department information required
from employers pursuant to article eighteen of the labor law, and the
department shall furnish to the state department of labor, or other
individuals designated by the commissioner of labor who are engaged in
purposes deemed appropriate by the commissioner of labor consistent with
the provisions of the labor law, withholding tax information obtained or
derived pursuant to part V of this article, or pursuant to equivalent
provisions enacted under the authority of article thirty, thirty-A or
thirty-B of this chapter, and taxpayer identification information
acquired under any of the provisions of this chapter, for tax
administration and employment security program purposes.

(2)(A) For purposes of this subsection, the term "tax administration
purposes" means and includes:

(i) the administration, management, conduct, direction, and
supervision of the execution and application of any tax, special
assessment, fee or other imposition administered by the commissioner,

(ii) the development and formulation of state policy relating to
existing or proposed tax laws and related statutes, and

(iii) the assessment, collection, enforcement, litigation, publication
and statistical gathering functions under such laws or statutes.

(B) For purposes of this subsection, the term "employment security and
public assistance work program purposes" means the unemployment
insurance programs administered by the commissioner of labor pursuant to
the labor law and those employment and training programs with respect to
which the department of labor has administrative, reporting, monitoring,
or evaluating responsibilities.

(3) Information obtained by the department from the state department
of labor pursuant to the provisions of this subsection shall be
confidential, and shall not be disclosed or redisclosed except for tax
administration and employment security and public assistance program
purposes.

(4) The commissioner shall enter into an agreement with the
commissioner of the state department of labor in order to ensure the
confidentiality of tax and unemployment insurance information and that
such information is disclosed only for authorized purposes in connection
with the implementation of the provisions of this subsection and those
provisions of subsection (e) of this section relating to unemployment
insurance information obtained or derived by the department from
quarterly combined withholding, wage reporting and unemployment
insurance returns required to be filed pursuant to paragraph four of
subsection (a) of section six hundred seventy-four of this article.

(m) Disclosure of collection activities with respect to joint
return.--Notwithstanding the provisions of subsection (e) of this
section, if any deficiency of tax with respect to a joint return is
assessed and the individuals filing such return are no longer married or
no longer reside in the same household, upon request in writing by
either of such individuals, the commissioner shall disclose in writing
to the individual making the request whether the commissioner has
attempted to collect such deficiency from such other individual, the
general nature of such collection activities, and the amount collected.
The preceding sentence shall not apply to any deficiency which may not
be collected by reason of the expiration of time within which to issue a
warrant under subsection (c) of section six hundred ninety-two of this
article or within which to collect such tax by execution and levy or by
court proceeding.

(n) Disclosure of certain information where more than one person is
subject to penalty.--If the commissioner determines that a person is
liable for a penalty under subsection (g) of section six hundred
eighty-five of this article with respect to any failure, upon request in
writing of such person, the commissioner shall disclose in writing to
such person (1) the name of any other person whom the commissioner has
determined to be liable for such penalty with respect to such failure,
and (2) whether the commissioner has attempted to collect such penalty
from such other person, the general nature of such collection
activities, and the amount collected.

(o) Exchange of information with the office of temporary and
disability assistance.--Notwithstanding any provision of law to the
contrary, the department shall furnish to the office of temporary and
disability assistance, or as designated by the commissioner of the
office of children and family services, to employees of a local social
services district who are engaged in the process of determining the
eligibility of children in the custody, care and custody or custody and
guardianship of a local social services district for federal payments
for foster care and adoption assistance pursuant to the provisions of
title IV-E of the federal social security act, the name, social security
number and wages of the parents, the stepparents, the child and the
siblings of the child who were living in the same household as a child
who is in the custody, care and custody or custody and guardianship of a
local social services district or of the office of children and family
services during the month that the court proceedings leading to the
child's removal from the household were initiated, or the written
instrument transferring care and custody of the child pursuant to the
provisions of section three hundred fifty-eight-a or three hundred
eighty-four-a of the social services law was signed; provided however,
that the office of temporary and disability assistance or such social
services district shall only use the information obtained pursuant to
this subsection for the purpose of determining the eligibility of such
child for federal payments for foster care and adoption assistance
pursuant to the provisions of title IV-E of the federal social security
act.