TAX NEWS - June 2010

New York Tax: Tax Mistake Costs Suffolk County Millions Of Dollars

Huge error by taxpayer messes up sales tax revenue

HAUPPAUGE, N.Y. - Thanks to a colossal taxpayer error on a state return, Suffolk County officials are reeling over the fact that they have $5 million less than they thought in the county coffers.

The mistake involved a taxpayer listing that $10 million in sales tax was owed on out-of-state Internet purchases, Newsday reported.

In fact budget officials say the taxpayer actually meant to put down $1,000.

The massive blunder should have been caught, budget experts say, because the resident would have had to spend $116 million dollars in purchases for the numbers to work out right.

The State Department of Taxation and Finance finally uncovered the gaffe, but too late for Suffolk, New York State and the Metropolitan Transportation Authority. All had already been credited with the sales tax revenue which was really never there.