(B) In the case of a failure to file a return of tax within sixty days of the date prescribed for filing of such return (determined with regard to any extension of time for filing), unless it is shown that such failure is due to reasonable cause and not due to willful neglect, the addition to tax under subparagraph (A) of this paragraph shall not be less than the lesser of one hundred dollars or one hundred percent of the amount required to be shown as tax on such return.

(C) For purposes of this paragraph, the amount of tax required to be shown on the return shall be reduced by the amount of any part of the tax which is paid on or before the date prescribed for payment of the tax and by the amount of any credit against the tax which may be claimed upon the return.

(2) Failure to pay tax shown on return.--In case of failure to pay the amounts shown as tax on any return required to be filed under article nine, nine-a, nine-b or nine-c on or before the prescribed date (determined with regard to any extension of time for payment), unless it is shown that such failure is due to reasonable cause and not due to willful neglect, there shall be added to the amount shown as tax on such return one-half of one per cent of the amount of such tax if the failure is not for more than one month, with an additional one-half of one per cent for each additional month or fraction thereof during which such failure continues, not exceeding twenty-five per cent in the aggregate. For the purpose of computing the addition for any month the amount of tax shown on the return shall be reduced by the amount of any part of the tax which is paid on or before the beginning of such month and by the amount of any credit against the tax which may be claimed upon the return. If the amount of tax required to be shown on a return is less than the amount shown as tax on such return, this paragraph shall be applied by substituting such lower amount.

(3) Failure to pay tax required to be shown on return.--In case of failure to pay any amount in respect of any tax required to be shown on a return required to be filed under article nine or nine-a which is not so shown (including an assessment made pursuant to subsection (a) of section one thousand eighty-two of this article) within twenty-one calendar days of the date of a notice and demand therefor (ten business days if the amount for which such notice and demand is made equals or exceeds one hundred thousand dollars), unless it is shown that such failure is due to reasonable cause and not due to willful neglect, there shall be added to the amount of tax stated in such notice and demand one-half of one percent of such tax if the failure is not for more than one month, with an additional one-half of one percent for each additional month or fraction thereof during which such failure continues, not exceeding twenty-five percent in the aggregate. For the purpose of computing the addition for any month, the amount of tax stated in the notice and demand shall be reduced by the amount of any part of the tax which is paid before the beginning of such month.

(4) Limitations on additions.--

(A) With respect to any return, the amount of the addition under paragraph one of this subsection shall be reduced by the amount of the addition under paragraph two of this subsection for any month to which an addition applies under both paragraphs one and two. In any case described in subparagraph (B) of paragraph one of this subsection, the amount of the addition under such paragraph one shall not be reduced below the amount provided in such subparagraph.

(B) With respect to any return, the maximum amount of the addition permitted under paragraph three of this subsection shall be reduced by the amount of the addition under paragraph one of this subsection (determined without regard to subparagraph (B) of such paragraph one) which is attributable to the tax for which the notice and demand is made and which is not paid within ten days of such notice and demand.

(b) Deficiency due to negligence.---(1) If any part of a deficiency is due to negligence or intentional disregard of this article or article nine, nine-a, nine-b or nine-c, or rules or regulations thereunder (but without intent to defraud), there shall be added to the tax an amount equal to five percent of the deficiency.

(2) There shall be added to the tax (in addition to the amount determined under paragraph one of this subsection) an amount equal to fifty percent of the interest payable under section one thousand eighty-four with respect to the portion of the underpayment described in such paragraph one which is attributable to the negligence or intentional disregard referred to in such paragraph one, for the period beginning on the last date prescribed by law for payment of such underpayment (determined without regard to any extension) and ending on the date of the assessment of the tax (or, if earlier, the date of the payment of the tax).

(3) If any payment is shown on a return made by a payor with respect to dividends, patronage dividends and interest under subsection (a) of section six thousand forty-two, subsection (a) of section six thousand forty-four or subsection (a) of section six thousand forty-nine of the internal revenue code of nineteen hundred fifty-four, respectively, and the payee fails to include any portion of such payment in gross income, as that term is defined in paragraph one of subsection (d) of section one thousand eighty-three, any portion of an underpayment attributable to such failure shall be treated, for purposes of this subsection, as due to negligence in the absence of clear and convincing evidence to the contrary. If any penalty is imposed under this subsection by reason of the preceding sentence, the amount of the penalty imposed by paragraph one of this subsection shall be five percent of the portion of the underpayment which is attributable to the failure described in the preceding sentence.

(c) Failure to file declaration or underpayment of estimated tax.-- (1) If any taxpayer fails to file a declaration of estimated tax under article nine-A of this chapter, or fails to pay all or any part of an amount which is applied as an installment against such estimated tax, it shall be deemed to have made an underpayment of estimated tax. There shall be added to the tax for the taxable year an amount at the underpayment rate set by the commissioner pursuant to section one thousand ninety-six of this article, or if no rate is set, at the rate of seven and one-half percent per annum upon the amount of the underpayment for the period of the underpayment but not beyond the fifteenth day of the fourth month following the close of the taxable year. Provided, however, that, for taxable years beginning on or after January first, two thousand seventeen and before January first, two thousand eighteen, no amount shall be added to the tax with respect to the portion of such tax related to the amount of any interest deductions directly or indirectly attributable to the amount included in exempt CFC income pursuant to subparagraph (ii) of paragraph (b) of subdivision six-a of section two hundred eight of this chapter or the forty percent reduction of such exempt CFC income in lieu of interest attribution if the election described in paragraph (b) of subdivision six-a of such section is made. The amount of the underpayment shall be, with respect to any installment of estimated tax computed on the basis of either the preceding year's tax or the second preceding year's tax, the excess of the amount required to be paid over the amount, if any, paid on or before the last day prescribed for such payment or, with respect to any other installment of estimated tax, the excess of the amount of the installment which would be required to be paid if the estimated tax were equal to ninety-one percent of the tax shown on the return for the taxable year (or if no return was filed, ninety-one percent of the tax for such year) over the amount, if any, of the installment paid on or before the last day prescribed for such payment. In any case in which there would be no underpayment if "eighty percent" were substituted for "ninety-one percent" each place it appears in this subsection, the addition to the tax shall be equal to seventy-five percent of the amount otherwise determined. No underpayment shall be deemed to exist with respect to a declaration or installment otherwise due on or after the termination of existence of the taxpayer.

(2) For purposes of applying the addition to tax for an underpayment of any installment of estimated tax by a taxpayer subject to tax pursuant to article thirty-three of this chapter, the amount of tax shall be determined by using the lesser of the differential earnings rate (as described in subsection (c) of section eight hundred nine of the internal revenue code) of the second tax year preceding the taxable year for which the installment is made, or the differential earnings rate for the taxable year for which the installment is made. Such addition to tax shall be applied to any taxable year without regard to any adjustments to the differential earnings amount under subsection (f) of section eight hundred nine of the internal revenue code for such year.

(3) The provisions of this subsection and subsections (d) and (e) of this section shall apply to the failure of a taxpayer to file a declaration of estimated tax surcharge or the failure to pay all or any part of an amount which is applied as an installment against such estimated tax surcharge pursuant to sections one hundred ninety-seven-a, one hundred ninety-seven-b, two hundred thirteen-a, two hundred thirteen-b, fifteen hundred thirteen and fifteen hundred fourteen of this chapter. For purposes of applying this section and subsections (d) and (e) of this section to the estimated tax surcharge, where appropriate the term "tax" shall be read to mean "tax surcharge," and the terms "amount required to be paid," "amount which would be required to be paid," and "amount which would have been required to be paid" shall be computed as the product of (1) such amount computed without regard to the tax surcharges imposed under sections one hundred eighty-four-a, one hundred eighty-six-c, one hundred eighty-eight, two hundred nine-A, two hundred nine-B, fifteen hundred five-a, and fifteen hundred twenty of this chapter, and (2) the MTA percentage. The term "MTA percentage" shall mean the product of (A) the tax rate applicable under such sections imposing such surcharges and (B) the percentage utilized in determining the portion of the taxpayer's business activity carried on within the metropolitan commuter transportation district under such sections.

(d) Exception to addition for underpayment of estimated tax.--The addition to tax under subsection (c) with respect to any underpayment of any amount which is applied as an installment against estimated tax under article nine-a, nine-b or nine-c shall not be imposed if the total amount of all payments of estimated tax made on or before the last date prescribed for the payment of any such amount equals or exceeds the amount which would have been required to be paid on or before such date if the estimated tax were whichever of the following is the least--

(1) The tax shown on the return of the taxpayer for the preceding taxable year, if a return showing a liability for tax was filed by the taxpayer for the preceding taxable year and such preceding year was a taxable year of twelve months, or

(2) An amount equal to the tax computed at the rates applicable to the taxable year, but otherwise on the basis of the facts shown on the return of the taxpayer for, and the law applicable to, the preceding taxable year, or

(3) Annualized income installment. (A) General. An amount equal to ninety-one percent of the tax for the taxable year computed on all items entering into the computation of the tax or taxes of the taxpayer for the taxable year under article nine, nine-A or thirty-three of this chapter. For purposes of computing the tax, all items of receipts, income and expenses shall be placed on an annualized basis--

(i) for the first three months of the taxable year, in the case of the installment required to be paid in the sixth month,

(ii) for the first six months of the taxable year, in the case of the installment required to be paid in the ninth month, and

(iii) for the first nine months of the taxable year, in the case of the installment required to be paid in the twelfth month.

(B) Special rules. For purposes of subparagraph (A), items of receipts, income and expenses shall be placed on an annualized basis by--

(i) multiplying such items by twelve (or, in the case of a taxable year of less than twelve months, the number of months in the taxable year), and

(ii) dividing the resulting amounts by the number of months referred to in subparagraph (A) (or in subparagraph (C), if an election applies to the taxable year under such subparagraph).

(C) Election for different annualization periods. (i) If the taxpayer makes an election under this clause--

(I) Clause (i) of subparagraph (A) of this paragraph shall be applied by substituting "four months" for "three months",

(II) Clause (ii) of subparagraph (A) of this paragraph shall be applied by substituting "seven months" for "six months",

(III) Clause (iii) of subparagraph (A) of this paragraph shall be applied by substituting "ten months" for "nine months".

(ii) If the taxpayer makes an election under this clause--

(I) Clause (i) of subparagraph (A) of this paragraph shall be applied by substituting "five months" for "three months",

(II) Clause (ii) of subparagraph (A) of this paragraph shall be applied by substituting "eight months" for "six months",

(III) Clause (iii) of subparagraph (A) of this paragraph shall be applied by substituting "eleven months" for "nine months".

(iii) An election under clause (i) or (ii) of this subparagraph shall apply to the taxable year for which made and such an election shall be effective only if made on or before the date required for filing the declaration of estimated tax for such taxable year, or

(4) (A) If the base period percentage for any six consecutive months of the taxable year equals or exceeds seventy percent, an amount equal to ninety-one percent of the tax determined in the following manner--

(i) take the items entering into the computation of the tax or taxes of the taxpayer for the taxable year under article nine, nine-A or thirty-three of this chapter, for all months during the taxable year preceding the filing month,

(ii) divide such amounts by the base period percentage for all months during the taxable year preceding the filing month,

(iii) determine the tax on the amounts determined under clause (ii), and

(iv) multiply the tax determined under clause (iii) by the base period percentage for the filing month and all months during the taxable year preceding the filing month.

(B) For purposes of subparagraph (A)--

(i) the base period percentage for any period of months shall be the average percent which the taxable income for the corresponding months in each of the three preceding taxable years bears to the taxable income for the three preceding taxable years. The tax commission may by regulations provide for the determination of the base period percentage in the case of reorganizations, new corporations, and other similar circumstances, and

(ii) the term "filing month" means the month in which the installment is required to be paid.

(5) In the case of any declaration installment, any reduction in such installment resulting from the application of paragraph three or four of this subsection shall be recaptured by increasing the amount of the next installment determined under paragraph one or two of this subsection or paragraph one of subsection (c) of this section by the amount of such reduction (and by increasing subsequent installments to the extent that the reduction has not previously been recaptured under this paragraph). For purposes of the preceding sentence, a declaration installment means any installment of estimated tax other than the mandatory first installment required under paragraph (a) of subdivision one of section one hundred ninety-seven-b, subdivision (a) of section two hundred thirteen-b or subdivision (a) of section fifteen hundred fourteen of this chapter. For the purposes of this subsection the amounts specified in paragraphs (2), (3) and (4) shall be computed without regard to any increase in the rates applicable to the taxable year which may have become effective after the first day of the seventh month of such year.

(e) (1) Paragraphs (1) and (2) of subsection (d) of this section shall not apply in the case of any corporation (or any predecessor corporation) which had business income, or the portion thereof allocated within the state, of one million dollars or more for any taxable year during the three taxable years immediately preceding the taxable year involved; provided, however, that in the case of a corporation subject to tax under section fifteen hundred two-a of this chapter, paragraphs (1) and (2) of subsection (d) of this section shall not apply if such corporation had entire net income, or the portion thereof allocated within the state, of one million dollars or more for any of the three taxable years immediately preceding the taxable year involved, or if the direct premiums subject to tax under section fifteen hundred two-a of this chapter of the corporation for any of such three preceding taxable years beginning on or after January first, two thousand three equals or exceeds three million seven hundred fifty thousand dollars.

(2) In the case of taxpayers described in paragraph one of this subsection, paragraph one of subsection (c), subparagraph (A) of paragraph three of subsection (d), and subparagraph (A) of paragraph four of subsection (d) of this section shall be applied by substituting "one hundred percent" for "ninety-one percent" each place it appears.

(f) Deficiency due to fraud.---(1) If any part of a deficiency is due to fraud, there shall be added to the tax an amount equal to two times the deficiency.

(2) The addition to tax under this subsection shall be in lieu of any other addition to tax imposed by subsection (a) or (b).

(g) Additional penalty.---Any person who with fraudulent intent shall fail to pay under article nine, nine-a, nine-b or nine-c, any tax, or to make, render, sign or certify any return or declaration of estimated tax, or to supply any information within the time required by or under such article, shall be liable to penalty of not more than one thousand dollars, in addition to any other amounts required under this article, to be imposed, assessed and collected by the tax commission. The tax commission shall have the power, in its discretion, to waive, reduce or compromise any penalty under this subsection.

(h) Additions treated as tax.---The additions to tax and penalties provided by this section shall be paid upon notice and demand and shall be assessed, collected and paid in the same manner as taxes, and any reference in this article to tax imposed by article nine, nine-a, nine-b or nine-c shall be deemed also to refer to the additions to tax and penalties provided by this section. For purposes of section one thousand eighty-one, this subsection shall not apply to---

(1) any addition to tax under subsection (a) except as to that portion attributable to a deficiency;

(2) any addition to tax under subsection (c) or (o); and

(3) any additional penalties under subsections (g) and (l).

(i) Determination of deficiency.---For purposes of subsections (b) and (f), the amount shown as the tax by the taxpayer upon its return shall be taken into account in determining the amount of the deficiency only if such return was filed on or before the last day prescribed for the filing of such return, determined with regard to any extension of time for such filing.

(j) Person defined.---For purposes of subsections (g) and (l), the term person includes an individual, corporation, partnership or limited liability company or an officer or employee of any corporation (including a dissolved corporation), or a member or employee of any partnership, or a member, employee or manager of a limited liability company, who as such officer, employee, manager or member is under a duty to perform the act in respect of which the violation occurs. * (k) Substantial understatement of liability.-- (1) If there is a substantial understatement of tax for any taxable year, there shall be added to the tax an amount equal to ten percent of the amount of any underpayment attributable to such understatement. For purposes of this subsection, there is a substantial understatement of tax for any taxable year if the amount of the understatement for the taxable year exceeds the greater of ten percent of the tax required to be shown on the return for the taxable year or five thousand dollars. For purposes of the preceding sentence, the term "understatement" means the excess of the amount of the tax required to be shown on the return for the taxable year, over the amount of the tax imposed which is shown on the return reduced by any rebate (within the meaning of subsection (h) of section one thousand eighty-one of this article). The excess under the preceding sentence shall be determined without regard to items to which subsection (k-1) of this section applies. The commissioner may waive all or any part of the addition to tax provided by this section on a showing by the taxpayer that there was reasonable cause for the understatement (or part thereof) and that the taxpayer acted in good faith.

(2) The amount of the understatement under paragraph one of this subsection shall be reduced by that portion of the understatement which is attributable to (A) the tax treatment of any item by the taxpayer if there is or was substantial authority for such treatment, or (B) any item if the relevant facts affecting the item's tax treatment are adequately disclosed in the return or in a statement attached to the return.

(3)(A) Subparagraph (B) of paragraph two of this subsection shall not apply to any item attributable to a tax shelter.

(B) For purposes of this paragraph, the term "tax shelter" means

(i) a partnership or other entity,

(ii) any investment plan or arrangement, or

(iii) any other plan or arrangement, if a significant purpose of such partnership, entity, plan, or arrangement is the avoidance or evasion of tax. * NB Effective until July 1, 2024 * (k) Substantial understatement of liability.--If there is a substantial understatement of tax for any taxable year, there shall be added to the tax an amount equal to ten percent of the amount of any underpayment attributable to such understatement. For purposes of this subsection, there is a substantial understatement of tax for any taxable year if the amount of the understatement for the taxable year exceeds the greater of ten percent of the tax required to be shown on the return for the taxable year or five thousand dollars. For purposes of the preceding sentence, the term "understatement" means the excess of the amount of the tax required to be shown on the return for the taxable year, over the amount of the tax imposed which is shown on the return reduced by any rebate (within the meaning of subsection (h) of section one thousand eighty-one). The amount of such understatement shall be reduced by that portion of the understatement which is attributable to the tax treatment of any item by the taxpayer if there is or was substantial authority for such treatment, or any item with respect to which the relevant facts affecting the item's tax treatment are adequately disclosed in the return or in a statement attached to the return. The tax commission may waive all or any part of the addition to tax provided by this section on a showing by the taxpayer that there was reasonable cause for the understatement (or part thereof) and that the taxpayer acted in good faith. * NB Effective July 1, 2024 * (k-1) Reportable transaction understatement.-- (1) If a taxpayer has a reportable transaction understatement for any taxable year, there shall be added to the tax an amount equal to twenty percent of the amount of such understatement.

(2) For purposes of this section, the term "reportable transaction understatement" means the sum of

(A) the product of--

(i) the amount of the increase (if any) in the applicable tax base which results from a difference between the proper tax treatment of an item to which this section applies and the taxpayer's treatment of such item (as shown on the taxpayer's return of tax), and

(ii) the highest rate of tax imposed under the article of this chapter that applies to the taxpayer, and

(B) the amount of the decrease (if any) in the aggregate amount of credits determined under the article of this chapter that applies to the taxpayer which results from a difference between the taxpayer's treatment of an item to which this section applies (as shown on the taxpayer's return of tax) and the proper tax treatment of such item. For purposes of subparagraph (A) of this paragraph, any reduction of the excess of deductions allowed for the taxable year over gross income for such year, and any reduction in the amount of capital losses which would (without regard to section one thousand two hundred eleven of the internal revenue code) be allowed for such year, shall be treated as an increase in the applicable tax base.

(3) This subsection shall apply to any item which is attributable to--

(A) any listed transaction, and

(B) any reportable transaction (other than a listed transaction) if a significant purpose of such transaction is the avoidance or evasion of tax.

(4) Paragraph one of this subsection shall be applied by substituting "thirty percent" for "twenty percent" with respect to the portion of any reportable transaction understatement with respect to which the requirement of clause (i) of subparagraph (B) of paragraph ten of this subsection is not met.

(5) For purposes of this subsection, the terms "reportable transaction" and "listed transaction" have the meanings given to such terms by section twenty-five of this chapter, the term "reportable transaction" shall include a "New York reportable transaction" as defined in such section twenty-five, and the term "listed transaction" shall include any transaction designated as a tax avoidance transaction pursuant to such section twenty-five.

(6) In the case of an understatement (as defined in subsection (k) of this section)

(A) the amount of such understatement (determined without regard to this paragraph) shall be increased by the aggregate amount of reportable transaction understatements for purposes of determining whether such understatement is a substantial understatement under subsection (k) of this section, and (B) the addition to tax under subsection (k) of this section shall apply only to the excess of the amount of the substantial understatement (if any) after the application of subparagraph (A) of this paragraph over the aggregate amount of reportable transaction understatements.

(7) References to an understatement (or a deficiency) in subsection (f) of this section shall be treated as including references to a reportable transaction understatement.

(8) This subsection shall not apply to any portion of any understatement on which a penalty is imposed under subsection (f) of this section.

(9) Except as provided in regulations prescribed by the commissioner, in no event shall any tax treatment included with an amendment or supplement to a return of tax be taken into account in determining the amount of any reportable transaction understatement if the amendment or supplement is filed after the earlier of the date the taxpayer is first contacted by the commissioner regarding the examination of the return or such other date as is specified by the commissioner.

(10)(A) No penalty shall be imposed under this subsection with respect to any portion of a reportable transaction understatement if it is shown that there was a reasonable cause for such portion and that the taxpayer acted in good faith with respect to such portion.

(B) Subparagraph (A) of this paragraph shall not apply to any reportable transaction understatement unless:

(i) the relevant facts affecting the tax treatment of the item are adequately disclosed in accordance with section twenty-five of this chapter,

(ii) there is or was substantial authority for such treatment, and

(iii) the taxpayer reasonably believed that such treatment was more likely than not the proper treatment. A taxpayer failing to adequately disclose in accordance with section twenty-five of this chapter shall be treated as meeting the requirements of clause (i) of this subparagraph if the penalty for such failure was rescinded under subsection (p) of this section.

(11)(A) A taxpayer shall be treated as having a reasonable belief with respect to the tax treatment of an item only if such belief

(i) is based on the facts and law that exist at the time the return of tax which includes such tax treatment is filed, and

(ii) relates solely to the taxpayer's chances of success on the merits of such treatment and does not take into account the possibility that a return will not be audited, such treatment will not be raised on audit, or such treatment will be resolved through settlement if it is raised.

(B)(i) An opinion of a tax advisor may not be relied upon to establish the reasonable belief of a taxpayer if

(I) the tax advisor is described in clause (ii) of this subparagraph, or

(II) the opinion is described in clause (iii) of this subparagraph.

(ii) A tax advisor is described in this clause if the tax advisor:

(I) is a material advisor (within the meaning of section six thousand one hundred eleven of the internal revenue code or within such meaning as it also applies to a New York reportable transaction as defined in section twenty-five of this chapter) and participates in the organization, management, promotion, or sale of the transaction or is related (within the meaning of subsection (b) of section two hundred sixty-seven of the internal revenue code or subsection (b) of section seven hundred seven of the internal revenue code) to any person who so participates,

(II) is compensated directly or indirectly by a material advisor with respect to the transaction,

(III) has a fee arrangement with respect to the transaction which is contingent on all or part of the intended tax benefits from the transaction being sustained, or

(IV) has a disqualifying financial interest with respect to the transaction.

(iii) For purposes of clause (i) of this subparagraph, an opinion is disqualified if the opinion

(I) is based on unreasonable factual or legal assumptions (including assumptions as to future events),

(II) unreasonably relies on representations, statements, findings, or agreements of the taxpayer or any other person,

(III) does not identify and consider all relevant facts, or

(IV) fails to meet any other requirement as the commissioner may prescribe. * NB Repealed July 1, 2024

(k-2) No penalty will be imposed pursuant to subsection (c) or (k) of this section for a taxable year beginning on or after January first, two thousand eight and before January first, two thousand nine resulting from the denial of an empire zone tax credit claimed by the taxpayer because an empire zone retention certificate was not issued pursuant to subdivision (w) of section nine hundred fifty-nine of the general municipal law to the empire zone enterprise which is the basis for the tax credit or credits claimed on the return or report.

(l) Aiding or assisting in the giving of fraudulent returns, reports, statements or other documents.--(1) Any person who, with the intent that tax be evaded, shall, for a fee or other compensation or as an incident to the performance of other services for which such person receives compensation, aid or assist in, or procure, counsel, or advise the preparation or presentation under, or in connection with any matter arising under article nine, nine-A, nine-B or nine-C of this chapter of any return, report, declaration, statement or other document which is fraudulent or false as to any material matter, or supply any false or fraudulent information, whether or not such falsity or fraud is with the knowledge or consent of the person authorized or required to present such return, report, declaration, statement or other document shall pay a penalty not exceeding ten thousand dollars.

(2) For purposes of paragraph one of this subsection, the term "procures" includes ordering (or otherwise causing) a subordinate to do an act, and knowing of, and not attempting to prevent, participation by a subordinate in an act. The term "subordinate" means any other person (whether or not a director, officer, employee, or agent of the taxpayer involved) over whose activities the person has direction, supervision, or control.

(3) For purposes of paragraph one of this subsection, a person furnishing typing, reproducing, or other mechanical assistance with respect to a document shall not be treated as having aided or assisted in the preparation of such document by reason of such assistance.

(4) The penalty imposed by this subsection shall be in addition to any other penalty provided by law.

(n) Failure to file report of information relating to certain interest payments.--In case of failure to file the report of information required under subdivision two-a of section two hundred eleven, unless it is shown that such failure is due to reasonable cause and not due to willful neglect, there shall be added to the tax a penalty of five hundred dollars. * (p) Failure to disclose or provide reportable transaction information. -- (1) Any person who fails to file, disclose or provide any statement, return or other document which is required under subdivision (a) of section twenty-five of this chapter shall pay a penalty in the amount determined under paragraph two of this subsection.

(2)(A) Except as provided in subparagraph (B) of this paragraph, the amount of the penalty under paragraph one of this subsection shall be twenty thousand dollars.

(B) The amount of the penalty under paragraph one of this subsection with respect to a listed transaction shall be fifty thousand dollars.

(3) For purposes of this subsection, the terms "reportable transaction" and "listed transaction" shall have the same meanings as used in section twenty-five of this chapter, the term "reportable transaction" shall include a "New York reportable transaction" as defined in such section twenty-five, and the term "listed transaction" shall include any transaction designated as a tax avoidance transaction pursuant to such section twenty-five.

(4) The commissioner may rescind all or any portion of any penalty imposed by this subsection with respect to any violation if

(A) the violation is with respect to a reportable transaction other than a listed transaction, and

(B) rescinding the penalty would promote compliance with the requirements of this chapter and effective tax administration.

(5) The penalty imposed by this section shall be in addition to any other penalty imposed by this chapter. * NB Repealed July 1, 2024 * (q) Failure to disclose or provide reportable transaction return.-- (1) Any person who fails to file, disclose or provide any statement, return or other document which is required under subdivision (b) of section twenty-five of this chapter shall pay a penalty in the amount determined under paragraph two of this subsection.

(2)(A) Except as provided in subparagraph (B) of this paragraph, the amount of the penalty under paragraph one of this subsection shall be twenty thousand dollars.

(B) The amount of the penalty under paragraph one of this subsection with respect to a listed transaction shall be the greater of

(i) fifty thousand dollars or,

(ii) fifty percent of the gross income that the organizer or material advisor derived with respect to activities that were the basis for the requirement to file, disclose or provide information pursuant to section six thousand eleven of the internal revenue code, to the extent such gross income is attributable to the avoidance of any tax imposed under article nine, nine-A or thirty-three of this chapter.

(C) Clause (ii) of subparagraph (B) of this paragraph shall be applied by substituting "seventy-five percent" for "fifty percent" in the case of an intentional failure or act described in paragraph one of this subsection.

(3) For purposes of this subsection, the terms "reportable transaction" and "listed transaction" shall have the same meanings as used in section twenty-five of this chapter, the term "reportable transaction" shall include a "New York reportable transaction" as defined in such section twenty-five, and the term "listed transaction" shall include any transaction designated as a tax avoidance transaction pursuant to such section twenty-five.

(4) The commissioner may rescind all or any portion of any penalty imposed by this subsection with respect to any violation if

(A) the violation is with respect to a reportable transaction other than a listed transaction, and

(B) rescinding the penalty would promote compliance with the requirements of this chapter and effective tax administration.

(5) The penalty imposed by this subsection shall be in addition to any other penalty imposed by this chapter, except that no penalty shall be imposed under subparagraph (A) or clause (i) of subparagraph (B) of paragraph two of subsection (y) of section six hundred eighty-five of this chapter for the same failure that is the basis for a penalty under this subsection. Nothing in this paragraph shall preclude the imposition of a penalty under clause (ii) of subparagraph (B) of paragraph two of subsection (y) of section six hundred eighty-five of this chapter for the same failure that is the basis for a penalty under clause (ii) of subparagraph (B) of paragraph two of this subsection. * NB Repealed July 1, 2024 * (r) Failure to maintain list of advisees.-- (1) If any person who is required to maintain a list under subdivision (c) of section twenty-five of this chapter fails to make a duplicate of such list available upon written request by the commissioner in accordance with such subdivision within twenty business days after the date of such request, such person shall pay a penalty of ten thousand dollars for each day of such failure after such twentieth day.

(2) No penalty shall be imposed by paragraph one of this subsection with respect to the failure on any day if such failure is due to reasonable cause. * NB Repealed July 1, 2024 * (s) Tax preparer penalty.-- (1) If:

(A) any part of any understatement of liability with respect to any return or claim for refund is due to a position for which there was not a reasonable belief that the tax treatment in that position was more likely than not the proper treatment,

(B) any person who is a tax return preparer with respect to such return or claim knew (or reasonably should have known) of such position, and

(C) such position was not disclosed as provided in subsection (k) of this section or there was no reasonable basis for the tax treatment of that position, such person shall pay a penalty of up to one thousand dollars with respect to such return or claim unless it is shown that there is reasonable cause for the understatement and such person acted in good faith.

(2) If any part of any understatement of liability with respect to any return or claim for refund is due

(A) to a willful attempt in any manner to understate the liability for tax by a person who is a tax return preparer with respect to such return or claim, or

(B) to any reckless or intentional disregard of rules or regulations by any such person, such person shall pay a penalty of up to five thousand dollars with respect to such return or claim. With respect to any return or claim, the amount of the penalty payable by any person by reason of this paragraph shall be reduced by the amount of the penalty paid by such person by reason of paragraph one of this subsection.

(3) For purposes of this subsection, the term "understatement of liability" means any understatement of the net amount payable with respect to any tax imposed under article nine, nine-A or thirty-three of this chapter or any overstatement of the net amount creditable or refundable with respect to any such tax.

(4) This subsection shall not apply if the penalty under subsection (l) of this section is imposed on the tax return preparer with respect to such understatement. * NB Repealed July 1, 2024 * (t) Promoting abusive tax shelters.-- (1) Any person who

(A)(i) organizes (or assists in the organization of)

(I) a partnership or other entity,

(II) any investment plan or arrangement, or

(III) any other plan or arrangement, or

(ii) participates (directly or indirectly) in the sale of any interest in an entity or plan or arrangement referred to in clause (i) of this subparagraph, and

(B) makes or furnishes or causes another person to make or furnish (in connection with such organization or sale)

(i) a statement with respect to the allowability of any deduction or credit, the excludability of any income, or the securing of any other tax benefit by reason of holding an interest in the entity or participating in the plan or arrangement which the person knows or has reason to know is false or fraudulent as to any material matter, or

(ii) a gross valuation overstatement as to any material matter, and

(C) satisfies any of the following conditions

(i) the person is organized in this state,

(ii) the person is doing business in this state,

(iii) the person is deriving income in this state, or

(iv) the person conducts any of the activities described in subparagraph (A) or (B) of this paragraph within the state of New York, shall pay, with respect to each activity described in subparagraph (A) of this paragraph, a penalty equal to one thousand dollars or, if the person establishes that it is lesser, one hundred percent of the gross income derived (or to be derived) by such person from such activity to the extent such gross income is attributed to the avoidance of any tax imposed under articles nine, nine-A or thirty-three of this chapter; provided, however, that if an activity with respect to which a penalty imposed under this subsection involves a statement described in clause (i) of subparagraph (B) of paragraph one of this subsection, the penalty shall be equal to fifty percent of the gross income derived (or to be derived) from that activity within the state by the person on which the penalty is imposed. For purposes of the preceding sentence, activities described in clause (i) of subparagraph (A) of this paragraph with respect to each entity or arrangement shall be treated as a separate activity and participation in each sale described in clause (ii) of subparagraph (A) of this paragraph shall be so treated.

(2)(A) For purposes of this subsection, the term "gross valuation overstatement" means any statement as to the value of any property or services if--

(i) the value so stated exceeds two hundred percent of the amount determined to be the correct valuation, and

(ii) the value of such property or services is directly related to the amount of any deduction or credit allowable under this chapter to any participant.

(B) The commissioner may waive all or any part of the penalty provided by paragraph one of this subsection with respect to any gross valuation overstatement on a showing that there was a reasonable basis for the valuation and that such valuation was made in good faith.

(3) The penalty imposed by this subsection shall be in addition to any other penalty provided by law. * NB Repealed July 1, 2024

(u) False or fraudulent document penalty. Any taxpayer that submits a false or fraudulent document to the department will be subject to a penalty of one hundred dollars per document submitted, or five hundred dollars per tax return submitted. This penalty will be in addition to any other penalty or addition provided by law.

(v) Failure to supply all the information required or to provide correct information in secretary of state statements. Unless it is shown that such failure to provide the statement and information required by section four hundred eight of the business corporation law is due to reasonable cause and not to willful neglect, there shall, upon notice and demand by the commissioner and in the same manner as tax, be paid by the taxpayer failing to supply complete and correct information, a penalty of two hundred fifty dollars per corporation required to provide such information.