New York

In New York, a tax notice can come from three agencies: the IRS, the State Department of Taxation and Finance, or the City Department of Finance. Each one has its own audits, deadlines and route of appeal. At Whiteford Tax Defense, our New York tax attorneys handle all three from the Midtown office on Madison Avenue. We act for business owners, closely held companies and individuals at every stage, including court when the stakes justify it.

Clients come to us from Manhattan, Brooklyn, Queens, the Bronx and Staten Island, and from Westchester, Long Island and the Hudson Valley. Some live in New Jersey or Connecticut but have New York filing obligations because of their work. Others live here but also file in the District of Columbia, Maryland, Virginia or another state with a Whiteford office.

Wherever you live, you do not have to answer an IRS or State notice yourself. Both agencies recognize your right to retain an authorized representative of your choice. Once you give us written authorization, we can deal with the agency for you.

Speed matters too, because tax deadlines are short and mostly unforgiving. Have the notice in hand for our first conversation: an IRS examination letter, a State notice of deficiency, or a City notice of determination. We will walk you through the deadline and your choices before you commit to hiring anyone.

Federal cases in New York courts

Your IRS examination may be run from an office in another state, and we can still represent you, because IRS practice is federal. Most of the work happens by letter, by phone and through the Independent Office of Appeals, not in a courtroom. If a dispute is still open after Appeals, the courts that sit here come into play.

You can contest a notice of deficiency in the U.S. Tax Court before you pay the tax. For a New Yorker, a missed 90-day petition deadline is not always the end, because New York is in the Second Circuit.

In Buller v. Commissioner (2d Cir. 2025), that court held that the section 6213(a) deadline is a nonjurisdictional claim-processing rule. So equitable tolling may apply, letting the Tax Court hear a late petition in narrow cases. The taxpayer must have acted diligently, and extraordinary circumstances must have prevented a timely filing. The relief depends on circuit law, so treat the deadline as firm anyway.

The other route, a refund suit in federal district court, generally has to wait until you have paid the full tax and claimed a refund. For the trust fund recovery penalty, that is often the only way into court. The Tax Court has no deficiency jurisdiction over that penalty.

Even so, you do not have to pay the whole penalty before you sue. Like employment taxes, it is divisible. You may pay the part for one employee and one quarter, claim a refund, then sue. The government can then counterclaim for the rest.

New York State time limits

New York State runs on a 90-day clock. A notice of deficiency or notice of determination becomes a fixed assessment if you file neither a petition nor a conciliation request within 90 days of its issue date. Neither the Department nor the Division of Tax Appeals can extend that statutory period.

Two things can stop the clock. A timely conciliation request suspends the running of the period. And the law presumes that a mailed notice was received, but that presumption can be rebutted. If the Department cannot prove it properly mailed the notice to your last known address, the period may never have started.

Three more New York time limits can decide a case before the merits come up. First, a refund claim is due within three years of filing the return or two years of paying the tax, whichever is later. If a sales tax refund claim is denied, you have 90 days to protest to the Division of Tax Appeals.

Second, you must report a federal audit adjustment to New York. If you never report it, the tax can be assessed at any time. If you do, the Department has two years from your report, limited to the increase that the change causes.

Third, the ordinary assessment period is three years. It grows to six years if a return omits more than 25 percent of New York adjusted gross income. There is no limit if no return was filed, or if a return was false or fraudulent with intent to evade.

Sales tax cases add one more step before a court will review a Tribunal decision. It is easy to miss, because the judicial review statute does not mention it. You must deposit the tax, penalties and interest at stake with the Commissioner, and file an approved surety undertaking. Instead of the deposit, you may post an undertaking that covers those amounts plus costs.

Residency and the convenience rule

Residency audits are what New York is known for, and the rules favor people who prepare.

You can be taxed as a New York resident even if your domicile, your permanent legal home, is elsewhere. That happens if you keep a permanent place of abode in the state for substantially all of the taxable year and spend more than 183 days here.

In practice, the day count is strict. Any part of a calendar day in New York counts as a full day. The regulations allow two narrow exceptions. One covers days here only to board a plane, ship, train or bus leaving the state. The other covers days spent traveling through. Records made at the time, not memory, decide these cases.

Nonresidents who work for New York employers face a separate problem: the convenience of the employer rule. Under it, days you work outside New York count as New York days. The exception is work done out of state because of the employer's necessity, not the employee's convenience. So a Connecticut or New Jersey resident's work-from-home days for a New York employer can count as New York days. Remote and hybrid work have not softened it.

In July 2026, the Appellate Division, Third Department upheld the rule in Matter of Zelinsky, even for remote work during the pandemic. It reasoned that a public health emergency and employer necessity are not the same thing.

The court made a sharper point, too. The state order that sent the law school remote did not require the professor to teach from Connecticut. The school got the same benefit wherever he taught.

New York City's separate track

If both the State and the City audit you, you have two disputes, not one. The City's Department of Finance runs its own business and excise taxes. You protest a City notice of determination to the New York City Tax Appeals Tribunal, which has its own deadlines and its own route to court. A filing in one system preserves nothing in the other.

We are candid about what we do not claim. This page describes the procedure and the venues. It does not list results before the New York State or New York City Tax Appeals Tribunal. Federal tax controversy is the core of the practice, and New York State and City matters are staffed accordingly.

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Michael March

Partner, Co-Chair Tax Section

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