1087. Limitations on credit or refund.--(a) General.--Claim for credit or refund of an overpayment of tax under article nine or nine-A shall be filed by the taxpayer within (i) three years from the time the return was filed, (ii) two years from the time the tax was paid or (iii) in the case of any overpayment arising from an erroneous denial by the department of environmental conservation of a certification of completion pursuant to section 27-1419 of the environmental conservation law, two years from the time a final determination to the effect that such denial was erroneous is made and is no longer subject to judicial review, whichever of such periods expires the latest, or if no return was filed, within two years from the time the tax was paid. If the claim is filed within the three year period, the amount of the credit or refund shall not exceed the portion of the tax paid within the three years immediately preceding the filing of the claim plus the period of any extension of time for filing the return. If the claim is not filed within the three year period, but is filed within the two year period, the amount of the credit or refund shall not exceed the portion of the tax paid during the two years immediately preceding the filing of the claim. In the case of a claim for credit or refund filed within the period prescribed in paragraph (iii) of this subsection, the amount of the credit or refund may exceed the portion of the tax paid within the applicable period specified in the two immediately preceding sentences, but only to the extent of the amount of the overpayment attributable to the denial described in such paragraph (iii). Except as otherwise provided in this section, if no claim is filed, the amount of a credit or refund shall not exceed the amount which would be allowable if a claim had been filed on the date the credit or refund is allowed. For special restriction in a proceeding on a claim for refund of tax paid pursuant to an assessment made as a result of (i) a net operating loss carryback or capital loss carryback, or (ii) an increase or decrease in federal taxable income or federal tax, or (iii) a federal change or correction or renegotiation, or computation or recomputation of tax, which is treated in the same manner as if it were a deficiency for federal income tax purposes, see paragraph (7) of subsection (c) of section one thousand eighty-three.
(b) Extension of time by agreement.--If an agreement under the provisions of paragraph (2) of subsection (c) of section one thousand eighty-three (extending the period for assessment of tax) is made within the period prescribed in subsection (a) for the filing of a claim for credit or refund, the period for filing a claim for credit or refund, or for making credit or refund if no claim is filed, shall not expire prior to six months after the expiration of the period within which an assessment may be made pursuant to the agreement or any extension thereof. The amount of such credit or refund shall not exceed the portion of the tax paid after the execution of the agreement and before the filing of the claim or the making of the credit or refund, as the case may be, plus the portion of the tax paid within the period which would be applicable under subsection (a) if a claim had been filed on the date the agreement was executed.
(c) Notice of change or correction of federal income.-- If a taxpayer is required by subdivision three of section two hundred eleven or paragraph one of subdivision (e) of section fifteen hundred fifteen of this chapter, to file a report or amended return in respect of (i) a decrease or increase in federal taxable income or federal alternative minimum taxable income or federal tax, or (ii) a federal change or correction or renegotiation, or computation or recomputation of tax, which is treated in the same manner as if it were an overpayment for federal income tax purposes, claim for credit or refund of any resulting overpayment of tax shall be filed by the taxpayer within two years from the time such report or amended return was required to be filed with the commissioner. If the report or amended return required by any such provision of law is not filed within the period therein specified, no interest shall be payable on any claim for credit or refund of the overpayment attributable to the federal change or correction. The amount of such credit or refund--
(1) shall be computed without change of the allocation of income or capital upon which the taxpayer's return (or any additional assessment) was based, and
(2) shall not exceed the amount of the reduction in tax attributable to such decrease or increase in federal taxable income, federal alternative minimum taxable income, or federal tax or to such federal change or correction or renegotiation, or computation or recomputation of tax. This subsection shall not affect the time within which or the amount for which a claim for credit or refund may be filed apart from this subsection.
(d) Overpayment attributable to net operating loss carryback or capital loss carryback.--A claim for credit or refund of so much of an overpayment under article nine-a as is attributable to the application to the taxpayer of a net operating loss carryback or a capital loss carryback shall be filed within three years from the time the return was due (including extensions thereof) for the taxable year of the loss, or within the period prescribed in subsection (b) in respect of such taxable year, or within the period prescribed in subsection (c), where applicable, in respect of the taxable year to which the net operating loss or capital loss is carried back, whichever expires the latest. Where such claim for credit or refund is filed after the expiration of the period prescribed in subsection (a), or in subsection (b) where applicable, in respect of the taxable year to which the net operating loss or capital loss is carried back, the amount of such credit or refund shall be computed without change of the allocation of income or capital upon which the taxpayer's return (or any additional assessment) was based.
(e) Failure to file claim within prescribed period.--No credit or refund shall be allowed or made, except as provided in subsection (f) of this section or subsection (d) of section one thousand ninety, after the expiration of the applicable period of limitation specified in this article, unless a claim for credit or refund is filed by the taxpayer within such period. Any later credit shall be void and any later refund erroneous. No period of limitations specified in any other law shall apply to the recovery by a taxpayer of moneys paid in respect of taxes under article nine, nine-a, nine-b or nine-c.
(f) effect of petition to tax commission.--If a notice of deficiency for a taxable year has been mailed to the taxpayer under section one thousand eighty-one and if the taxpayer files a timely petition with the tax commission under section one thousand eighty-nine, it may determine that the taxpayer has made an overpayment for such year (whether or not it also determines a deficiency for such year). No separate claim for credit or refund for such year shall be filed, and no credit or refund for such year shall be allowed or made, except--
(1) as to overpayments determined by a decision of the tax commission which has become final; and
(2) as to any amount collected in excess of an amount computed in accordance with the decision of the tax commission which has become final; and
(3) as to any amount collected after the period of limitation upon the making of levy for collection has expired; and
(4) as to any amount claimed as a result of a change or correction described in subsection (c).
(g) Limit on amount of credit or refund.--The amount of overpayment determined under subsection (f) shall, when the decision of the tax commission has become final, be credited or refunded in accordance with subsection (a) of section one thousand eighty-six and shall not exceed the amount of tax which the tax commission determines as part of its decision was paid--
(1) after the mailing of the notice of deficiency, or
(2) within the period which would be applicable under subsections (a), (b) or (c), if on the date of the mailing of the notice of deficiency a claim had been filed (whether or not filed) stating the grounds upon which the tax commission finds that there is an overpayment.
For special restriction on credit or refund in a proceeding on a petition for redetermination of a deficiency where the notice of deficiency is issued as a result of (i) a net operating loss carryback or a capital loss carryback, or (ii) an increase or decrease in federal taxable income or federal tax, or (iii) a federal change or correction or renegotiation, or computation or recomputation of tax, which is treated in the same manner as if it were a deficiency for federal income tax purposes, see paragraph (7) of subsection (c) of section one thousand eighty-three.
(h) Early return.--For purposes of this section, any return filed before the last day prescribed for the filing thereof shall be considered as filed on such last day, determined without regard to any extension of time granted the taxpayer.
(i) Prepaid tax.--For purposes of this section, any tax paid by the taxpayer before the last day prescribed for its payment (including any amount paid by the taxpayer as estimated tax for a taxable year) shall be deemed to have been paid by it on the fifteenth day of the third month following the close of the taxable year the income of which is the basis for tax under article nine-a, or on the last day prescribed in article nine for the filing of a final return for such taxable year, or portion thereof, determined in all cases without regard to any extension of time granted the taxpayer, for taxable years beginning before January first, two thousand sixteen, and on the fifteenth day of the fourth month following the close of the taxable year the income of which is the basis for tax under article nine-a, or on the last day prescribed in article nine for the filing of a final return for such taxable year, or portion thereof, determined in all cases without regard to any extension of time granted the taxpayer, for taxable years beginning on or after January first, two thousand sixteen.
(j) Cross reference.--For provision barring refund of overpayment credited against tax of a succeeding year, except for good cause shown, see subsection (b) of section one thousand eighty-six.
Last modified: February 3, 2019