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Establish a segregated bank account for sales taxes

We encourage all sales tax vendors to voluntarily establish a separate bank account for sales taxes that they collect on behalf of New York State to make it easier to comply with the tax law.    

To improve sales tax compliance, we can require certain sales tax vendors to deposit sales tax into a separate bank account. The requirement applies to vendors who failed to collect and remit sales tax or who have failed to file their sales tax returns on time. This tax law change was effective March 31, 2011. 

Vendors who are required to use a separate bank account for sales taxes must:

  • Set up a bank account
  • Pay back taxes
    • If your tax payments aren't up to date, be sure that you pay any balances due. You can request an installment payment agreement for these unpaid taxes.

If you don't open a bank account by the deadline stated in the letter we sent you:

  • You may have to post a bond (at your cost).
  • We may require you to file sales tax returns every month, if you aren't already required to do so.
  • We may suspend or revoke your sales tax Certificate of Authority. Without a certificate, you won't be able to sell tangible personal property or provide taxable services.

More information

See TSB-M-11(9)S, Summary of Budget Bill Sales and Use Tax Changes Enacted in 2011.