NY Driver License Suspension for NY Back Taxes
If you owe a debt to the New York State Department of Taxation and Finance, that could result in a suspension of your right to drive. If that happens to you, then you could get arrested if you’re caught driving without a valid license. You could also face fines of up to $300.
While most Americans are afforded the ability to traverse the open roadways, it’s important for everyone to remember that driving is a privilege and not an inherent right. Not everyone is allowed to get behind the wheel of a motor vehicle and start driving down the road. Instead, they need to take specific steps, including applying for a state-issued driver’s license.
It’s important to understand your tax obligations and meet them in a timely manner. If you don’t, then NYS could suspend your driver license, in addition to all of the other collection efforts at their disposal. Learn more about New York state tax debt, how it can lead to a license suspension, and how to resolve your tax problems below.
When NY Will Suspend a Driver’s License Over a Tax Debt
The New York State Department of Taxation and Finance will not immediately move to suspend your license if you fail to file your taxes on time or if you just pay a bit late, but this is a valid collection effort they’re likely to use if you owe the agency and aren’t making an effort to resolve your tax debt.
Typically, license suspension will only be considered when you owe at least $10,000 in past-due tax debt, you’ve received several notices about your delinquency, and you haven’t contacted the agency about paying off your debt.
Before your suspension, you will receive a Notice of Proposed Driver’s License Suspension. This notice provides you with a 60-day grace period to act before the agency contacts the Department of Motor Vehicles. If you don’t respond, then you will receive an Order of Suspension or Revocation 15 days before your license officially gets suspended.
Where Does the NY Department of Taxation and Finance Get the Authority to Suspend My Driver’s License?
New York Tax Law Section 171-v authorizes the Department of Taxation and Finance to coordinate with the Department of Motor Vehicles to suspend the driver’s licenses of anyone who owes $10,000 or more in taxes to New York State.
How to Stop or Avoid a Suspension of Your Driver’s License
When you have overdue taxes, you’ll receive an indefinite suspension order, which means you’ll have to take specific actions in order to remove the suspension. Typically, your suspension won’t be cleared by the Department of Taxation and Finance until you’ve taken one of the following actions:
- You pay your tax debt off in full
- You are approved for an exclusion or financial hardship
- You agreed to a New York state tax solution like a payment plan
If you need more help determining your best path forward, then it might be best to get in touch with a tax resolution attorney before your situation progresses further.
How You’ll Get Notified About Your Driver’s License Suspension
First, you’ll receive notices about your tax delinquency. Then, you’ll receive a letter regarding a possible license suspension. At that point, you have 60 days to take action.
What Happens if You Don’t Respond to Your Notice?
If you do not respond to your notice, then the NY DTF will notify the Department of Motor Vehicles about your taxpayer’s driver’s license suspension. It will automatically go into effect within 15 days of processing.
Understanding the Economic Hardship Exception
While New York state has a right to collect what you owe, they aren’t interested in unfairly penalizing you if you genuinely can’t afford to pay off your debt. If making tax payments would put you at risk of not being able to afford your living expenses, then you can apply for an economic hardship exemption.
DTF-5.1 and DTF-5
To apply, you’ll first fill out Form DTF-5.1. On this form, you’ll provide some basic identifying information before explaining why your exemption should be approved. Next, you’ll fill out Form DTF-5. This form should give the tax agency an overview of how many dependents you have, the types of assets you own, the bank accounts tied to your name, your current income level, and your household expenses.
How to Prove Your Financial Status
You must attach your federal returns from the past three years when you submit your DTF-5 form. You’ll also need to submit a recent credit report and all your bank account statements from the past 12 months. Depending on your specific situation, you might also need to provide other documentation to prove the claims you make on your form.
How to Check the Status of Your Driving Privileges
You can check the status of your driving privileges on the NY DMV website. You’ll want to either sign up for an account or sign into MyDMV. From there, click on “My License, Permit, or ID service”. On this page, you’ll be able to see the status of your driver’s license.
FAQs: New York State Taxes and Your Driver’s License
Do you have more questions about New York state tax debt, driver’s license suspensions, or other collection efforts? To get the most reliable advice, it’s best to consult with a tax attorney who can consider your unique financial circumstances. That said, we’ll go over some general answers to some of the most frequently asked questions below:
Is there any way around a Driver’s License suspension?
You do not have the right to appeal a license suspension, but you might be able to avoid a suspension if your situation meets one of the following circumstances:
- You’re not the taxpayer that owes a tax debt
- You resolved your tax debt
- You are already facing wage garnishment for the tax debt in question
- Your wages are already being garnished for child support payments
- You have a commercial driver’s license
- You are seeking out Innocent Spouse Relief
- You are in the process of filing for bankruptcy
- You’re currently receiving public assistance
- You’re currently collecting supplemental security income (SSI)
- You would face economic hardship if New York suspends your license
If you think you might be eligible for an exemption, then contact an attorney as soon as possible. You might be able to prevent the suspension before it is put into place.
Does New York state tax debt ever expire?
Yes. Generally, New York State tax debts expire after 20 years. After that period, the government can no longer pursue your past tax debt unless you take action that resets the statute of limitations on the debt.
What other consequences can I face if I still don’t pay my taxes?
The NYS Department of Taxation and Finance has several types of collection efforts available to use against you if you fail to pay your taxes in time. For one, you’ll immediately start accruing interest and penalties when you don’t pay. Aside from suspending your license, you could face collection efforts like wage garnishment, asset levies, or even criminal charges if you continue to willfully avoid your tax obligations.
Are You Ready to Get in Touch with a Tax Attorney in New York?
Have you swept your New York state tax obligations under the rug for too long? If so, then you might have already been hit with collection efforts like a suspension of your driver’s license. If your license is suspended, or you received a notice threatening a suspension, now is the time to act.
Here at McLaud Law P.C., our team of experienced tax resolution professionals know how to deal with the Department of Taxation and Finance and can help protect your interests and evaluate your tax problem to find the best options for getting you back on the road. Contact us now to schedule a free consultation where we can discuss your current tax problems in more detail, or give us a call at 585-397-7785. You don’t have to deal with this on your own.
This communication is Attorney Advertising. It is presented for informational purposes only and does not constitute legal advice. Every legal situation is different, and prior results do not guarantee a similar outcome. This communication does not create an attorney-client relationship between McLaud Law P.C. and the recipient.