What's happening
This bill prohibits municipal corporations in New York from paying auditors on a contingency or results-based fee for tax audits.
Why it matters
Reduces potential conflicts of interest. by ensuring auditors hired by city and local governments have no personal financial stake in the outcomes of tax audits, which could otherwise incentivize overly aggressive or unfair audit practices.
May impact municipal finances. by potentially increasing upfront costs for audits, since municipalities will have to pay auditors a fixed fee rather than a percentage of taxes recovered, which could affect how frequently or thoroughly audits are pursued.
Aims to promote fairer tax administration. by removing incentives for auditors to maximize penalties or assessments simply to increase their own compensation, thereby helping to ensure that tax audits are conducted objectively and equitably.
Could affect smaller municipalities disproportionately. , as those with limited budgets may have relied on contingency-fee audit arrangements to afford tax compliance enforcement, possibly leading to fewer or less extensive audits.
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Who cares
Headline styles
Ban Contingency Audit Fees
Plain English, a few words. Used as the page title.
Sponsors
Assembly Member · Assembly District 127
8 Co-sponsors
1 Multi-sponsor
History
- Referred to local governments
- Print number 7244a
- Amend and recommit to local governments
- Referred to local governments
Companion bill
The same bill in the other chamber. A bill becomes law when one version passes both houses and the governor signs it, so either number can carry it.
Ban Contingency Audit Fees
In Senate Committee · Local Government · Sponsor Jen Metzger
Full text
1 pageUnderlined is new[Struck] is removedOfficial text on nysenate.gov ↗
STATE OF NEW YORK
7244--A
2019-2020 Regular Sessions
IN ASSEMBLY
April 18, 2019
Introduced by M. of A. STIRPE, JACOBSON, ROMEO, D'URSO, ORTIZ, RAMOS, NORRIS, MONTESANO -- Multi-Sponsored by -- M. of A. ENGLEBRIGHT -read once and referred to the Committee on Local Governments -committee discharged, bill amended, ordered reprinted as amended and recommitted to said committee
AN ACT to amend the general municipal law, in relation to prohibiting compensation for service of auditing relating to any tax on a contingency basis
The People of the State of New York, represented in Senate and Assembly, do enact as follows:
Section 1. The general municipal law is amended by adding a new section 39-a to read as follows:
§ 39-a. Prohibition on contingent compensation. Notwithstanding any inconsistent provision of law, a municipal corporation shall not compensate any person or entity for the service of auditing a return or report filed pursuant to, or in compliance with, any law in whole or in part on a contingent fee basis or on any other basis related to the amount of tax, interest, or penalty assessed against or collected.
§ 2. This act shall take effect immediately.
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD11126-02-9
Reflowed for reading: line numbers and page breaks removed. Cite the official text.
Summaries, headlines and scores are AI-generated from the official bill text. How we score bills. Source: NYS Open Legislation.