The Department of Taxation and Finance has now begun posting pending Advisory Opinion issues on its website and is giving the public the opportunity to comment on those issues.

An Advisory Opinion is a written statement setting forth the applicability of the law and regulations to a specified set of facts relating to a New York State tax. An Advisory Opinion is issued at the request of any person, and is binding on the Department only with respect to the requesting party and only based on the facts presented.

We understand that Department officials were made aware of one or more instances where Advisory Opinions were issued based on legal analysis that was not fully developed by the requester and/or facts that were allegedly not presented in a full or accurate manner. In order to minimize this possibility, the Department has begun to post on its web site, by tax type, a listing of the specific issues that are currently the subject of pending Advisory Opinions. The Department will now give the public the opportunity to submit comments on those issues, either through the Department’s website or by mail. For each issue, the Department provides a due date for comments to be submitted. The Department states in its website that all comments received by the specified due date will be reviewed and considered in drafting the Advisory Opinion, but that the Department will not be able to respond to individual comments. It is not necessary for public comments to be made on behalf of an identified person or entity.

Additional Insights. The furnishing of Advisory Opinions is a very valuable public service performed, free of charge, by the Department. Notwithstanding the submission of one or two requests that may not have fully and/or accurately presented the facts, it is not readily apparent why the new initiative for comments is necessary. Advisory Opinions are only binding on the Department with respect to the requester and under the precise facts presented. Nonetheless, if this comment period serves to assist the Department in continuing to issue well-reasoned Advisory Opinions, it is a welcome addition to the process.

The Department should consider making the public comments available to the requester to give the requester the opportunity to respond. It is also hoped that the new comment period will not delay the Department in issuing timely Advisory Opinions, which by regulation must be issued within 90 days (or, at the Department’s discretion, 120 days) of the submission of a completed request.