New York Tax Notices Explained: Every DTF Letter, Bill, and Notice (and What to Do)

If there’s a concern with your New York State taxes, the Department of Taxation and Finance will send you a correspondence to let you know. These can range from routine requests for information to advanced collection notices, and there’s usually a deadline for you to respond. The form number (usually on the upper left or bottom left of the notice) tells you why the DTF sent you the notice, and in most cases, your deadline to respond.

How you handle these tax notices and how much time you have to do so will depend on the facts of your tax case and the type of notice sent to you. The goal of this blog post is to explain the common types of notices, bills, and letters you might receive and what they mean.

If you receive any one of these documents from the New York Tax Department and still aren’t sure what to do, the Timothy S. Hart Law Group can help – learn how we represent taxpayers with DTF tax problems.

Key Takeaways

• Tax notice escalation – Early notices often request additional information or inform the taxpayer of a proposed tax change.
• Tax bills and assessments – If initial notices get ignored, a taxpayer can expect bills and tax collection letters such as Notice of Deficiency and Notice of Determination.
• Tax collection notices and letters – If a taxpayer doesn’t pay their tax bill, enforcement actions will follow and be preceded by documents such as a Notice and Demand.
• Protest rights – Many notices and letters will explain ways the taxpayer can challenge the DTF, such as by requesting a conciliation conference or Tax Appeals Hearing. Still, these requests must be made before the applicable deadline.
• Tax collection enforcement – It’s important to respond promptly to avoid collection actions, such as a tax warrant, income execution, bank levy, or driver’s license suspension.

How New York Tax Notices Escalate

The New York State (NYS) Department of Taxation and Finance (DTF) will usually begin by sending a request for additional information (like a DTF-948) or an informal notice about a potential tax adjustment (like a DTF-160 or DTF-960-E). If the issue remains unresolved, the DTF may issue a formal assessment, such as a Notice of Deficiency. Follow the deadline printed on the specific notice and use the protest procedure described there; deadlines and available procedures depend on the notice and tax type.

If the taxpayer still ignores the DTF despite owing back taxes, tax collection enforcement actions start. This often begins with a tax warrant, then moves on to various forms of asset seizure.

Summary of New York Tax Notices and Forms

The following notices are presented in a mobile-friendly format. Always follow the deadline and instructions printed on your specific notice.

DTF-948 or DTF-948-O

What it means: The DTF needs more information to process your return.

Why you likely got it: The DTF is missing information from your return.

Deadline or protest rights: The deadline to provide the requested information should be located on this letter.

What to do: Go to your NYS DTF Online Services account to upload the additional information.

DTF-973.xx

What it means: The DTF needs more information to process your return.

Why you likely got it: The DTF is missing information from your return.

Deadline or protest rights: The deadline to provide the requested information should be located on this letter.

What to do: Go to your NYS DTF Online Services account to upload the additional information.

DTF-160 or DTF-161

What it means: Tax account adjustment notice.

Why you likely got it: The DTF has denied or adjusted your tax refund.

Deadline or protest rights: You can challenge the findings per the instructions provided on the notice.

What to do: Review the adjustment to see if you agree with it. If you don’t, respond with supporting documentation.

DTF-960-E

What it means: This is a proposition of additional tax, penalty, or interest due.

Why you likely got it: A review of your tax return found that you owe additional money to the NYS DTF.

Deadline or protest rights: No formal protest rights yet. Respond by the deadline listed on the letter.

What to do: You can request a review by following the instructions listed on page 2.

Consolidated Statement of Tax Liabilities

What it means: An online tool that summarizes all outstanding tax liabilities.

Why you likely got it: You owe one or more tax debts.

Deadline or protest rights: If you disagree with the amount due, you can request a review and provide supporting documentation.

What to do: Confirm the amount owed is correct. If it is, pay it in full or make other tax settlement arrangements. If it’s not, request a review.

Notice of Deficiency

What it means: A proposed tax assessment.

Why you likely got it: The NYS DTF believes you have an additional tax liability.

Deadline or protest rights: The notice should have a deadline to file a protest.

What to do: Confirm if you agree with the assessed tax. If you do, make arrangements to pay it and if you don’t, file a protest before the deadline expires.

Notice of Determination

What it means: The NYS DTF found an issue with your business’s taxes.

Why you likely got it: You have an additional tax liability or there was another tax change to your account that requires your attention.

Deadline or protest rights: The notice should have a deadline to file a protest if you disagree with the determination.

What to do: If you agree with the notice, comply with its instructions. If you don’t agree, file a protest after consulting with a tax professional.

Notice and Demand

What it means: Final demand of collection

Why you likely got it: You didn’t properly respond to prior tax notices.

Deadline or protest rights: This is a final bill. Review the notice for any remaining rights and the stated collection timeline, and respond promptly.

What to do: Respond as soon as possible. Ignoring this notice could result in tax collection enforcement actions, such as a tax warrant.

Tax Warrant

What it means: The NYS DTF has issued a tax lien against your property.

Why you likely got it: You weren’t able to resolve a tax debt with the DTF.

Deadline or protest rights: Limited; most options revolve around removing or subordinating the tax warrant.

What to do: Pay the total balance in full, set up an installment payment agreement (IPA), or ask for a release or subordination.

Information and Review Requests

The NYS DTF has a series of “Request for Information” (RFI) and information review letters they send to taxpayers when they need more information or to inform the taxpayer of something that’s going on with their tax account. Common examples of these information and review letters include:

• DTF-948 and DTF-948-O: Often used when a tax refund is being held and the DTF needs more information to process the return.
• DTF-160 and DTF-161: Usually used to tell a taxpayer that their tax refund is being adjusted or denied.
• DTF-973.xx series: These are usually requests for additional documentation relating to a claimed tax deduction, such as rental losses, business losses, or child and dependent care expenses.

Tax Bills and Assessments

If the DTF believes the taxpayer has unpaid taxes, they’ll send a tax assessment or tax bill. The most common ones are:

• DTF-960-E: After reviewing a tax return, the DTF has proposed an additional tax, penalty, and/or interest on the return.
• Notice and Demand: This is the final bill. Review the Notice and Demand for the payment deadline and collection timeline that apply to the specific liability.
• Consolidated Statement of Tax Liabilities: If your business has unpaid taxes spanning multiple tax periods or types, you can print a consolidated statement of your tax liabilities by logging in to your account. This is a summary of all the outstanding assessments and outstanding returns.

Protest and Challenge Notices From the New York State DTF

Many New York tax notices, bills, and letters contain information about appeal, protest, or challenge rights if the taxpayer disagrees with the DTF. The ability to challenge the DTF depends on the notice.

Some notices will specifically state that the taxpayer has protest rights. These rights will usually provide the taxpayer with the right to request a conciliation conference or petition for a Tax Appeals Hearing.

If the notice or letter doesn’t mention protest rights, or the time to file a protest has passed, the taxpayer may still have the right to request a review of a DTF action. Below is an overview of some of the most common NYS DTF notices and letters that offer New York taxpayers challenge rights:

• DTF-96, Notice of Taxpayer Rights: As its name implies, this document provides a summary of the taxpayer’s rights, including the right to challenge the DTF. DTF-96 often accompanies another tax notice or form sent by the DTF.
• Statement of Proposed Audit Change: This shows what the auditor believes a taxpayer owes the DTF, and has special procedures listed on the letter that explain how to challenge the audit findings.
• Notice of Deficiency: The NYS DTF sends you this notice if they believe you owe taxes. For example, if you disagreed with a statement of proposed audit changes and the auditor rejected your explanation, this is the notice the NYS sends. It comes with instructions to appeal.
• Notice of Determination: This is the notice the NYS DTF sends you if it reviews your business and believes you owe additional tax, interest, and penalties. It explains the applicable deadline and procedure for challenging the assessment.

Conciliation Conference Versus Tax Appeals Hearing

If a NY taxpayer has protest rights, they’ll usually get to choose between a Tax Appeals Hearing or a conciliation conference.

Conciliation conference

A conciliation conference uses a conferee, or impartial third party, to review the tax case and resolve the disagreement.

Before the conference, the division that issued the notice may contact you to resolve the issue prior to the conference. If it can’t be resolved, the conference is scheduled.

During the conference, the department representative explains the department’s position, and you’re given an opportunity to ask questions.

The conferee then attempts to mediate the dispute, and if they’re unsuccessful, they render the decision. If a taxpayer disagrees with the conferee, they can file a petition for a hearing with the Division of Tax Appeals.

Tax Appeal

A Tax Appeals Hearing is a more formal challenge to a DTF decision. Instead of a conferee, there will be an administrative law judge (ALJ); the taxpayer and the DTF each have opportunities to present evidence during the hearing.

If the taxpayer disagrees with the administrative law judge’s decision, the taxpayer can seek further review before the Tax Appeals Tribunal. A court of law will handle any disagreement with the Tax Appeals Tribunal.

Tax Collection and Enforcement Notices

In the later stages of the tax collection process, the DTF will send a series of notices and letters about the tax enforcement actions the DTF will use to collect the unpaid taxes. These include:

• Tax warrants: This creates a lien against your real and personal property and may allow the DTF to seize and sell them.
• Income execution: This is the equivalent of the IRS wage garnishment; the DTF instructs your employer to send a portion of your paycheck to cover your tax debt.
• Bank levy: With a bank levy, the DTF can take money directly out of the taxpayer’s bank account in any amount as long as it doesn’t include exempt funds or exceed the amount listed on the levy.
• Driver’s license suspension: New York law allows the DTF to request that a taxpayer’s driver’s license be suspended if they owe at least $10,000 in past-due taxes.

Responding to a NYS Department of Taxation and Finance Notice

Respond promptly and use the deadline printed on your specific notice. Read the entire notice, confirm the tax type and period, and gather the records that support your position.

• If you disagree, follow the review or protest instructions on the notice. An informal review does not pause or extend a statutory protest deadline.
• When formal protest rights are available, the notice may allow a request for a conciliation conference or a petition to the Division of Tax Appeals. Choose the procedure that fits your circumstances and file before the stated deadline.
• According to the New York State Department of Taxation and Finance, most protests begin with conciliation and many are resolved through that process. These figures describe DTF protest activity and do not guarantee an outcome in any individual matter.

When To Involve a Tax Professional

Sometimes you can respond to a notice or letter on your own, as the issues are fairly straightforward. However, in cases where there’s a lot of money in dispute, or you’re dealing with complex tax issues like audits or sales tax determinations, it’s usually best to consult with a tax professional.

A tax professional can help you appeal by gathering the right documents and preparing the right argument. If you have already missed your protest deadlines, they can also help negotiate a settlement or an Offer in Compromise.

If you need help dealing with any notices from the NYS DTF, we can help. Whatever tax problem you’re facing, we assure you - it won’t be our first. You also get to work with Tim, a New York Tax Lawyer & Certified Public Accountant who understands how accounting problems happen and how to fix them legally.

To learn more about our services, call 518-213-3445 (Albany office) or 917-382-5142 (New York City office) or use our online contact form to set up a consultation.

Frequently Asked Questions (FAQs)

Here are common questions we get on NYS DTF notices:

What does a DTF-948 notice mean?

This usually means the DTF needs more information before it can continue processing your tax return. The notice may ask for documents such as W-2s, residency proof, or receipts.

What is a DTF-960-E?

A DTF-960-E is a statement of proposed audit change indicating proposed additional tax, penalty, or interest. You may agree or submit records to challenge the proposed changes.

How long do I have to respond to a New York tax department notice?

Use the response or protest deadline printed on your specific notice. The deadline and available procedure vary by notice and tax type.

What’s the difference between a Notice of Deficiency and a Notice and Demand?

A Notice of Deficiency is a proposed tax assessment, while a Notice and Demand is a final tax bill.

What happens if I ignore my New York tax bill?

Ignoring a collection notice can lead to additional penalties and enforcement actions, including a levy.

Can the DTF garnish my wages or take money from my bank account?

The DTF can use income execution or a bank levy when legal requirements are met. Available resolution options depend on the facts and collection stage.

Sources

• New York DTF — Levies
• New York DTF — Personal income tax letters
• New York DTF — Additional refund information
• New York DTF — Disagreeing with a decision
• New York DTF — Protest procedures
• New York DTF — Driver’s license suspension
• New York DTF — DTF-996 taxpayer rights