Section 32. Registration of tax return preparers

(a) For purposes of this
  section, the following terms have the specified meanings:
    (1) "Attorney" means an attorney admitted to practice law in New  York
  state  or one or more of the other states or jurisdictions of the United
  States.
    (2)  "Certified  public  accountant"  means  an  accountant   licensed
  pursuant  to section seventy-four hundred four of the education law or a
  similar law of one or more of the other states or jurisdictions  of  the
  United States.
    (3) "Commercial tax return preparer" means a tax return preparer who:
    (A)  prepared  ten  or  more returns for compensation in the preceding
  calendar year and will prepare at  least  one  return  for  compensation
  during the current calendar year; or (B) prepared fewer than ten returns
  in  the preceding calendar year but will prepare ten or more returns for
  the current calendar year.
    (4) "Commercial tax return preparation business" means an entity  that
  employs   individuals  who  prepare  tax  returns  and  that  meets  the
  thresholds described in paragraph three of this subdivision.
    (5) "Creditor" means any person who makes a refund  anticipation  loan
  or who takes an assignment of a refund anticipation loan.
    (6) "Facilitator" means a person who individually or in conjunction or
  cooperation   with  another  person:  (a)  solicits  the  execution  of,
  processes, receives, or accepts an application or agreement for a refund
  anticipation loan or refund anticipation check, (b) serves  or  collects
  upon  a refund anticipation loan or refund anticipation check; or (c) in
  any other manner facilitates the making of a refund anticipation loan or
  refund anticipation  check.  This  term  excludes  any  employees  of  a
  facilitator  who  provide  only  clerical  or  other  comparable support
  services to such facilitator.
    (7) "Electronic" means computer technology.
    (8) "Enrolled agent" means an agent enrolled to  practice  before  the
  internal  revenue  service pursuant to section 10.4 of subpart A of part
  ten of title thirty-one of the code of federal regulations.
    (9) "Public accountant"  means  an  accountant  licensed  pursuant  to
  section  seventy-four hundred five of the education law or a similar law
  of one or more of the  other  states  or  jurisdictions  of  the  United
  States.
    (10)  "Refund anticipation check" means a check, stored value card, or
  other payment mechanism which: (a) represents  the  proceeds  of  a  tax
  refund;  (b) was issued by a depository institution or other person that
  received a direct deposit of the tax refund or tax credits;  and  (c)  a
  fee or other consideration is paid for such payment mechanism.
    (11)  "Refund  anticipation  loan"  means a loan that is secured by or
  that the creditor arranges to be repaid directly or indirectly from  the
  proceeds  of  an income tax refund or tax credits. A refund anticipation
  loan also includes any sale, assignment, or purchase of tax refund at  a
  discount  or  for  a  fee,  whether  or not the amount is required to be
  repaid to the buyer or assignee if the internal revenue service  or  the
  department denies or reduces the amount of the tax refund.
    (12)  "Return" means a return or report relating to a tax administered
  by the commissioner.
    (13) "Tax" means any tax, fee, special assessment or other  imposition
  administered by the commissioner.
    (14)  "Tax  return  preparer"  means  an  individual  who  prepares  a
  substantial portion of any return for compensation. Enrolled  agents  or
  employees   of  a  tax  return  preparer  or  a  commercial  tax  return
  preparation business who prepare returns for clients of that preparer or
  preparation business, as applicable, and partners  who  prepare  returns

  for  clients  of  a  partnership  engaged  in  a  commercial  tax return
  preparation business, are all "tax return  preparers"  for  purposes  of
  this  section. Excluded from the definition of "tax return preparer" are
  attorneys, public accountants, and certified public accountants, who are
  registered  with  or  licensed  by  the  state,  and employees preparing
  returns under the supervision of such attorneys, public accountants, and
  certified public accountants. Also excluded are volunteer tax preparers,
  employees  of  a  business  or  partners  in  a  partnership  whose  job
  responsibilities   include   preparation   of   only  the  business'  or
  partnership's returns, and employees of  a  tax  return  preparer  or  a
  commercial tax return preparation business who provides only clerical or
  other comparable services.
    (b)(1)  Each tax return preparer, who will prepare at least one return
  in a calendar year, and each facilitator, who will facilitate the making
  of a  refund  anticipation  loan  or  refund  anticipation  check,  must
  register  electronically  with the department for that calendar year, in
  accordance with instructions prescribed by the commissioner.
    (2)(A) Upon completion of the registration process,  each  tax  return
  preparer  and  facilitator  will be issued a tax preparer or facilitator
  registration certificate. If an individual acts as  both  a  tax  return
  preparer  and a facilitator, one registration certificate shall indicate
  both activities.
    (B) In accordance with instructions prescribed  by  the  commissioner,
  each  tax return preparer and facilitator will also be assigned a unique
  identification number by the department, which must be used by  the  tax
  return  preparer  and  facilitator  on  each return which the tax return
  preparer is required to sign  and  each  refund  anticipation  loan  and
  refund anticipation check the facilitator is required to sign.
    (C)  If  a  tax  return  preparer  or  facilitator  is  an employee or
  prospective employee of a tax return preparer, a commercial  tax  return
  preparation  business,  or  a  facilitator,  the  tax  return  preparer,
  commercial tax return preparation business or  facilitator  must  ensure
  that  the  employee  or prospective employee is properly registered with
  the department  and  possesses  a  valid  tax  preparer  or  facilitator
  registration  certificate.  If  an  individual acts as both a tax return
  preparer and a facilitator one registration certificate  shall  indicate
  both activities.
    (3)   Each   registered  tax  return  preparer  and  facilitator  must
  electronically re-register with the department annually,  in  accordance
  with instructions prescribed by the commissioner. If, at any time during
  the  year  following registration or re-registration, as applicable, any
  information provided by the tax  return  preparer  or  facilitator  upon
  registration  or  re-registration  is  no longer correct, the tax return
  preparer or facilitator must update his or her information in accordance
  with instructions prescribed by the commissioner.
    (4) Each tax return  preparer  preparing  any  return  must  sign  the
  document  and  include  the  unique  identification  number specified in
  paragraph two of  this  subdivision,  in  accordance  with  instructions
  prescribed by the commissioner.
    (c)(1)  Each commercial tax return preparer must electronically pay an
  annual fee of one hundred dollars to the department, in accordance  with
  instructions   prescribed   by   the  commissioner.  Registration  of  a
  commercial tax return preparer is not complete until payment of the  fee
  is made.
    (2)   All   fees   received  by  the  commissioner  pursuant  to  this
  subdivision, reduced by those amounts the  commissioner  determines  are
  necessary  to  cover administrative costs to administer the registration
  program prescribed by this section and the costs of  any  reimbursements

  to  commercial  tax  return  preparers  that  may  be  required  due  to
  duplicative fee payments  under  this  subdivision,  must  be  deposited
  monthly to the credit of the general fund of the state. The commissioner
  will maintain a system of accounts showing the amount of money collected
  and disbursed from the fee imposed by this subdivision.
    (d)  The  issuance  of  a  tax  preparer  or  facilitator registration
  certificate to provide tax preparation services or  refund  anticipation
  loan  services  is not, and must not be advertised as, an endorsement by
  the department of the tax return preparer or the facilitator, or his  or
  her qualifications or the services rendered by him or her.
    (e)  A tax return preparer who has not registered with the department,
  or a commercial tax return  preparer  who  has  not  paid  the  required
  registration  fee,  will  not be allowed to represent his or her clients
  before the division of taxation or the division  of  tax  appeals.  This
  sanction  is  in addition to any penalties which may be imposed pursuant
  to subdivision (f) of this section.
    (f) (1) A tax return preparer or facilitator shall not: (A) charge  or
  impose  any  fee,  charge  or  other  consideration  in  the  making  or
  facilitating of a refund anticipation loan or refund anticipation  check
  apart  from  the  fee  charged by the creditor or bank that provided the
  loan or check;
    (B)  Engage  in  unfair  or  deceptive  acts  or  practices   in   the
  facilitating  of  a  refund  anticipation check or a refund anticipation
  loan, including making any oral  statements  contradicting  any  of  the
  information  required  to be disclosed under the Taxpayer Bill of Rights
  as set forth in sections three hundred seventy-one through three hundred
  seventy-three of the general business law;
    (C) Directly or indirectly arrange for a third  party  to  charge  any
  interest,  fee or charge related to a refund anticipation loan or refund
  anticipation check;
    (D) Include any of the following provisions in any documents  provided
  or  signed  to  obtain a refund anticipation loan or refund anticipation
  check, including the loan application or agreement: (i) a hold  harmless
  clause;  (ii)  a  confession  of  judgment clause; (iii) a waiver of the
  right to a jury trial; (iv) any assignment of or order  for  payment  of
  wages  or other compensation for services; (v) a waiver of any provision
  of the Taxpayer Bill of Rights, as set forth in sections  three  hundred
  seventy-one  through three hundred seventy-three of the general business
  law; or (vi) a waiver of the right  to  injunctive,  declaratory,  other
  equitable  relief,  or  relief  on a classwide basis. Any aforementioned
  waivers shall be deemed null, void and of no effect;
    (E) Take or arrange for a creditor to take a security interest in  any
  property  interest  of  the  taxpayer other than the proceeds of the tax
  refund to secure payment of a refund anticipation loan;
    (F)  Directly  or  indirectly,  individually  or  in  conjunction   or
  cooperation  with  another  person,  engage  in  the  collection  of  an
  outstanding or delinquent refund anticipation loan for any  creditor  or
  assignee;
    (G) Refer, facilitate, solicit consumers or conduct business on behalf
  of, in conjunction with or on the same premises as a third party engaged
  in check cashing for a fee;
    (H)  Make  a  misrepresentation  of fact in obtaining or attempting to
  obtain a registration; or
    (I) Engage in any other action prohibited by rules promulgated by  the
  commissioner.
    (2)  If  a  tax  return  preparer  violates  any one of the provisions
  provided for in this subdivision, then the tax return preparer must  pay

  a  penalty  of five hundred dollars for each such violation, in addition
  to any other penalties provided for in this section.
    *(g)  (1)  If  a  tax  return  preparer  or facilitator is required to
  register or re-register with the department pursuant to paragraph one or
  three of subdivision (b) of this section, as applicable, and fails to do
  so in accordance with the terms of this section,  then  the  tax  return
  preparer of facilitator must pay a penalty of two hundred fifty dollars.
  Provided,  however,  that  if  the  tax  return  preparer or facilitator
  complies with the  registration  requirements  of  this  section  within
  ninety calendar days after notification of assessment of this penalty is
  sent  by  the  department,  then this penalty must be abated. If the tax
  return  preparer  or  facilitator  continues  to  fail  to  register  or
  re-register  after  the  ninety  calendar  day  period,  the  tax return
  preparer or facilitator must pay an additional penalty of  five  hundred
  dollars  if  the  failure  is  for  not  more  than  one  month, with an
  additional five hundred dollars for each additional  month  or  fraction
  thereof  during  which  the  failure continues. Once the ninety calendar
  days specified in this paragraph have expired, the penalty can be waived
  only for good cause shown by the tax return preparer or facilitator.
    (2) If a commercial tax return  preparer  fails  to  pay  the  fee  as
  required  in  paragraph  one  of  subdivision (c) of this section, for a
  calendar year, then the  commercial  tax  return  preparer  must  pay  a
  penalty  of  fifty  dollars  for  each  return the commercial tax return
  preparer has filed with the department in that calendar  year.  Provided
  however,  that  if  the commercial tax return preparer complies with the
  payment requirements  of  paragraph  one  of  subdivision  (c)  of  this
  section,   within   ninety  calendar  days  after  notification  of  the
  assessment of this penalty is sent by the department, then this  penalty
  must  be  abated.  The  maximum  penalty  that may be imposed under this
  paragraph on any commercial tax return preparer during any calendar year
  must not exceed five thousand dollars. Once  the  ninety  calendar  days
  specified in this paragraph have expired, the penalty can be waived only
  for good cause shown by the commercial tax return preparer.
    (3)  If  a  tax  return  preparer fails to sign his or her name to any
  return  that  requires  the  tax  return  preparer's  signature,  or   a
  facilitator  fails  to  sign  his or her name to any refund anticipation
  loan or refund anticipation check facilitation documentation,  then  the
  tax  return  preparer or facilitator must pay a penalty in the amount of
  two hundred fifty  dollars  for  each  failure  to  so  sign.  Provided,
  however,  that  this  penalty can be waived only for good cause shown by
  the tax return preparer or facilitator.
    The maximum penalty imposed under this paragraph  on  any  tax  return
  preparer  with  respect to returns filed during any calendar year by the
  tax return preparer, or on any facilitator with respect  to  any  refund
  anticipation    loan   or   refund   anticipation   check   facilitation
  documentation completed during any calendar year by the facilitator must
  not exceed ten thousand dollars. Provided, however, that if a tax return
  preparer or facilitator has been penalized under this  paragraph  for  a
  preceding  calendar  year and again fails to sign his or her name on any
  return that requires the tax return preparer's signature or again  fails
  to  sign  his  or  her  name  on  any refund anticipation loan or refund
  anticipation  check  facilitation  documentation  during  a   subsequent
  calendar  year,  then  the penalty under this paragraph for each failure
  will be five hundred dollars, and no annual cap will apply.
    (4) If a tax return preparer or a facilitator  fails  to  include  the
  unique  identification  number  assigned  by  the department pursuant to
  subparagraph (B) of paragraph two of subdivision (b) of this section  on
  any return, or any return anticipation loan or return anticipation check

  facilitation  documentation that requires his or her signature, then the
  tax return preparer or facilitator must pay a  penalty  of  one  hundred
  dollars  for  each  failure  to include his or her unique identification
  number. Provided, however, that this penalty can be waived only for good
  cause  shown  by  the  tax  return  preparer or facilitator. The maximum
  penalty imposed under this paragraph  on  any  tax  return  preparer  or
  facilitator  with respect to returns filed during any calendar year must
  not exceed two thousand five hundred dollars; provided, however, that if
  a tax return preparer or  facilitator  has  been  penalized  under  this
  paragraph  for  a preceding calendar year and again fails to include the
  unique identification number on one or more returns during a  subsequent
  calendar  year,  then  the penalty under this paragraph for each failure
  will be two hundred fifty dollars, and no annual cap will apply.
    (5) If a tax return preparer, facilitator or a commercial  tax  return
  preparation business employs an individual to prepare tax returns who is
  not  registered  with  the  department  and does not possess a valid tax
  preparer or facilitator registration certificate, then  the  tax  return
  preparer,  facilitator or commercial tax return preparation business, as
  applicable, will be subject to a penalty of  five  hundred  dollars  per
  occurrence. This penalty can be waived only for good cause shown.
    (6)  The  penalties provided for by this subdivision must be paid upon
  notice and demand and will be assessed, collected and paid in  the  same
  manner as taxes under article twenty-seven of this chapter.
    *NB There are 2 sb (g)'s
    *(g)  The  provisions  of  this  section will apply exclusively to the
  registration  of  tax  return  preparers  and  facilitators   with   the
  department,  payment  of  the registration fee if required by commercial
  tax return preparers, the signing of  returns  and  use  of  the  unique
  identification  numbers  assigned  by  the department upon registration.
  Other  provisions  of  this  chapter  or  any  other  provision  of  law
  prescribing  additional  requirements applicable to tax return preparers
  or facilitators will not be affected by the provisions of  this  section
  except  as set forth expressly herein, and will remain in full force and
  effect.
    *NB There are 2 sb (g)'s