§ 681. Notice of deficiency.--(a) General.--If upon examination of a\ntaxpayer's return under this article the tax commission determines that\nthere is a deficiency of income tax, it may mail a notice of deficiency\nto the taxpayer. If a taxpayer fails to file an income tax return\nrequired under this article, the tax commission is authorized to\nestimate the taxpayer's New York taxable income and tax thereon, from\nany information in its possession, and to mail a notice of deficiency to\nthe taxpayer. A notice of deficiency shall be mailed by certified or\nregistered mail to the taxpayer at his last known address in or out of\nthis state. If a husband and wife are jointly liable for tax, a notice\nof deficiency may be a single joint notice, except that if the tax\ncommission has been notified by either spouse that separate residences\nhave been established, then, in lieu of the single joint notice, a\nduplicate original of the joint notice shall be mailed to each spouse at\nhis or her last known address in or out of this state. If the taxpayer\nis deceased or under a legal disability, a notice of deficiency may be\nmailed to his last known address in or out of this state, unless the tax\ncommission has received notice of the existence of a fiduciary\nrelationship with respect to the taxpayer.\n (b) Notice of deficiency as assessment.--After ninety days from the\nmailing of a notice of deficiency, such notice shall be an assessment of\nthe amount of tax specified in such notice, together with the interest,\nadditions to tax and penalties stated in such notice, except only for\nany such tax or other amounts as to which the taxpayer has within such\nninety day period filed with the tax commission a petition under section\nsix hundred eighty-nine. If the notice of deficiency is addressed to a\nperson outside of the United States, such period shall be one hundred\nfifty days instead of ninety days.\n (c) Restrictions on assessment and levy.--No assessment of a\ndeficiency in tax and no levy or proceeding in court for its collection\nshall be made, begun or prosecuted, except as otherwise provided in\nsection six hundred ninety-four, until a notice of deficiency has been\nmailed to the taxpayer, nor until the expiration of the time for filing\na petition contesting such notice, nor, if a petition with respect to\nthe taxable year has been filed with the tax commission, until the\ndecision of the tax commission has become final. For exception in the\ncase of judicial review of the decision of the tax commission, see\nsubsection (c) of section six hundred ninety.\n (d) Exceptions for mathematical or clerical errors.--If a mathematical\nor clerical error appears on a return (including an overstatement of the\ncredit for income tax withheld at the source, or of the amount paid as\nestimated income tax), the commissioner shall notify the taxpayer that\nan amount of tax in excess of that shown upon the return is due, and\nthat such excess has been assessed. Such notice shall not be considered\nas a notice of deficiency for the purposes of this section, subsection\n(f) of section six hundred eighty-seven (limiting credits or refunds\nafter petition to the division of tax appeals), subsection (b) of\nsection six hundred eighty-nine (authorizing the filing of a petition\nwith the division of tax appeals based on a notice of deficiency), or\narticle forty of this chapter, nor shall such assessment or collection\nbe prohibited by the provisions of subsection (c).\n (e) Exceptions where federal changes, corrections or disallowances are\nnot reported.---\n (1) If the taxpayer or employer fails to comply with section six\nhundred fifty-nine or section six hundred fifty-nine-a, instead of the\nmode and time of assessment provided for in subsection (b) of this\nsection, the commissioner may assess a deficiency based upon such\nfederal change, correction or disallowance by mailing to the taxpayer a\nnotice of additional tax due specifying the
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