First
Aid Kit
For
Tax Receivers
& Collectors
Compiled by the
New
York State
Tax Receivers
& Collectors
Revised April 2001
INTRODUCTION
Dear Tax Receiver
or Collector:
So,
you won the Election!
CONGRATULATIONS!!
You wake up on the morning of the first Wednesday after the first Tuesday after the first Monday in November.
You realize that all the door knocking, hand shaking, envelope licking and phone calling has paid off. YOU ARE AN ELECTED OFFICIAL of your town.
OR
You wake up one morning and realize that in one crazy, foolish, weak moment you once again said yes (or mumbled something that sounded like it). You are an appointed official of your town.
And now, you are responsible for millions of dollars and several thousand pieces of paper containing what appear to be foreign codes.
DONT PANIC!
Eventually things will begin to fall into place and youll be running the show like a pro. But because we remember well the panic, confusion and utter despair that threatens to engulf you, we the members and officers of the New York State Association of Tax Receivers & Collectors, have prepared this First Aid Kit to help you survive and succeed. We were all there once, and hopefully our memories of that time will help your transition from private citizen to public official be a pleasant one.
That Little Green
Book
(Tax Collection in Towns)
Many situations and much of the terminology which you may find so confusing
at first will all fall into place if you will take the time to read the Little
Green Book (hereinafter referred to as LGB) officially entitled Tax Collection in Towns. This valuable tool is published by the Association
of Towns of the State of
TABLE OF CONTENTS
Introduction
Bank on It .. 1
Cash on Hand 1
Legal
Notices
. 2
Warrant
and Legal Authority
.
2
Ingredients
for an Unpopular Recipe
.
3
Its
Called Third Party Notification
4
Whats
a TSO
5
Pre-Payment
.. 6
NSF
or Bouncing Checks
.
7
Balancing
Act
. 7
Detecting
a Transposition
. 8
Detecting
a Slide
9
If
Taxes Are Not Paid
10
Plant
a Money Tree
... 10
No-No.
. 11
Nice
to Have
11
The
Ultimate in Handy Helpers (Directory of District Directors)
12
Map
of NYSATRC Districts
14
Membership
Application
15
Bank on It!!
One of the first items on your check-list should be a visit to the bank where you will be doing business. Your Town Board makes the decision as to which bank the Town will use check this out first. Determine ahead of time if the proper information was supplied to the bank for your account.
Introduce yourself to the manager and ask what they need from you to open an account. They will probably say money to deposit. Explain that you want everything set up so that when you make that first big deposit, all else is ready for you.
* Order a bank endorsement stamp with your name.
The Bank will give you one, but look into the self-inking variety (a big, big time saver!).
* Order printed deposit slips for your new account. Be sure to determine what your Town requires.
* Will you need an original deposit slip, plus one or two copies? By all means, ask for the non-carbon variety its quicker and less messy.
* Will you need a deposit bag? What about the locking, night-deposit variety? Your bank has the details.
* Are the night deposits insured? This is necessary for your protection.
Cash on Hand
Because many taxpayers still pay their bills in cash, you will need a petty cash fund. The amount of the fund will depend on you. You may establish a petty cash fund up to $250.00.
1
Legal Notices
Among the list of urgent requirements preparatory to collecting taxes is that you must publish a legal notice of tax collection. Page 16 of the LBG gives you a suggested format to follow and outlines the requirements under the Real Property Tax Law.
The Legal Notice must be published for two consecutive weeks in the paper officially designated for your Town. The published notice must be posted on the Town bulletin board.
Be sure to add information about the charge for Second Notice mailings, if that is something your Town Board has chosen to do. An example of the wording might be:
If taxes are unpaid and a Second Notice of taxes due is processed, an additional charge of (specify amount up to $2.00- set by town board) will be levied and become part of the amount due.
Warrant and Legal Authority
So, youve got the job, you found your office, you have a petty cash fund, a box of new letterhead stationery and a rubber stamp with your name on it. The bills will be ready any day now. Youre all set to start collecting tax money or are you?
Seems as though theres something about a WARRANT. What was it all about? Beginning on page 12 of your trusty LGB the mysteries of a warrant begin to become clear. Read the information over. Some parts may not be applicable to your circumstances, and there are several different Warrant forms (samples attached).
The Warrant is your legal authorization to proceed with tax collection. YOU CANNOT COLLECT A PENNY OF TAX MONEY BEFORE YOU HAVE A WARRANT IN HAND. Once you do, check it over to determine that
· the amount on the Warrant is the same as the total of taxes to be collected as shown on the last pages of the tax roll.
· The Warrant carries the raised seal of the taxing authority (town/county/school district).
· The number of days of collection is correct and agrees with the dates of collection.
Please note that as the collecting officer, you have no authority to change dates or deadlines. In plain English, you cannot extend your collection-free period to February 3, because you feel sorry for those individuals who get Social Security checks on the 3rd of the month!
However, the Town Board, and the School Board (for school taxes), may grant recipients of Social Security who have a senior citizens exemption, five (5) additional business days to pay their taxes on their residence. Check if a resolution for this purpose was adopted.
2
Ingredients for an Unpopular Recipe
Three ingredients are crucial in the recipe which results in a dollar amount for the taxes on a tax bill:
(1) property assessment (2) tax rate (3) equalization rate
Before you can put any of these ingredients into your mixing bowl, you should know what each one is.
· Property Assessment determines the value placed on properties within your community.
· Tax Rate identifies how much tax money is to be raised from each dollar of assessment.
· Equalization Rate well, bear with us, because this one can get complicated.
The Office of Real Property Services (ORPS) knows the total assessed value of property in your Town from reports obtained from the assessor(s). Then, they keep track of property sales in your Town to determine the actual (or full market) value. The ORPS people also travel the highways, byways and back roads of your Town, appraising properties to better judge the accuracy of current market values. The ratio between the assessed value equals the equalization rate. You could also say that the equalization rate represents the average level of assessments in your community.
As the equalization rate goes up, the tax rate will go down, and vice-versa. The tax rate also changes as the budget changes.
Got It? Good!
3
Its Called Third Party Notification
Some of our senior citizens find themselves in a bind when they get their tax bills:
? They are short of cash that month
? They are south for the winter.
? They are in a nursing home or hospital.
Whatever the reason, the tax bill may go unpaid and then the security of their home may be in jeopardy.
State law now requires us to advise all taxpayers of the option of Third Party Notification. This means that a copy of the tax bill can be sent to a third party. This third party is not obligated to pay the bill; the process is a means of alerting an interested and concerned party to the existence of a bill.
Refer to your LGB for an outline of procedures and sample forms.
IMPORTANT REFERENCE NUMBERS:
ORPS 518-474-8821
ASSOCIATION OF TOWNS 518-465-7933
OFFICE OF THE STATE COMPTROLLER 518-473-0005
COMMITTEE ON OPEN GOVERNMENT 518-474-2518
4
Whats a TSO?
Somewhere in the entire tax collection process, there must be a beginning point. Trouble is, we cant agree as to which point is the beginning.
The beginning probably is when the request lists come in from banks and mortgage companies. Some of these lists come from Tax Service Organizations (TSOs). Recalling our first tax collection we now realize that the TSO, its function and how it operates was pretty much a Chinese puzzle.
In simplified terms, a TSO is an agency that services escrow accounts for banks. This means that they (The TSOs) request the tax bills, verify the names and account numbers, and then forward the bills to the bank for payment.
The TSO does not pay tax bills. The TSO does not have access to escrow monies.
The request list you receive from the TSO will carry a coded bank number. They will provide you with a listing of their customers and their identifying number. Somewhere in your records you may want to show both the TSO and the bank.
TSOs Servicing Accounts in
First American Real Estate Tax Service 1-800-969-8787
Fax: 1-800-644-6262
Lereta Corp.
1-800-906-6313
Fax: 1-800-906-6316
Transamerica Real Estate Tax Service
1-888-698-3282
Fax: 1-518-459-8480
TSOs have been active at state meetings of the Receivers & Collectors, sharing suggestions, resolving problem situations and generally making positive contributions for our members. They have asked that we call them if we are experiencing difficulties with one of their customer banks/mortgage companies on such issues as late payments, incorrect tax map numbers or homeowners names, etc. In general, they will trouble-shoot for you. Once considered the bad guys on the block, TSOs are proving to be sources of timesaving assistance.
5
Pre-Payment
Pre-payment. Early Payment. It goes by different names, but it all comes down to the fact that some folks want to pay their taxes before January 1. Thats OK. Providing, of course, your warrant is dated before January 1.
YOU CANNOT COLLECT
A PENNY OF TAX MONEY BEFORE THE DATE OF THE WARRANT!
If you will contact the Chairman of your County Legislature/Board of Supervisors and explain the need for having the warrant dated say December 20 or 27, youll find them willing to cooperate. After all, its their constituency, too.
As people call in to ask about pre-payment, take their name, their tax map number, and a phone number where they may be reached during the day. When the bills come in, give them a call to tell them the amount of the tax, and then hold their bill in your office. If they have not come in to make payment by January 1, put the bill in the mail.
All That Money
All tax monies received by you must be deposited within 24 hours. No options here IT IS THE LAW!
How you handle your deposit can make a difference in the ease with which the bank can process your deposit and will improve your batting average for accuracy.
Run a tape on your stubs. Run a tape on your checks; subtotal and add in your cash. The total of the stubs should equal the total monies. Right? Good! (No??? Return to GO. Do not collect $200).
Nearly all banks will accept the adding machine tape of checks (attached to the deposit slip) in lieu of listing each check on the deposit slip. Sure saves time. Endorse all checks with your bank stamp. Count your coins and put them in an envelope. (Most banks provide these envelopes free of charge.) Mark the amount of coin total on the envelope and seal it.
6
Obtain a supply of bill straps in varying amounts. Bundle up the bills (all facing the same way, please) using the largest possible denomination. (Use one $1000 bundle rather than two $500 bundles) Stamp (your bank endorsement stamp is ok) or write your name and Town on the strap: youll save time by not having to stand in line while the teller counts and verifies each bundle. Also, write your name on each roll of coins for the same reason.
Make up each deposit as follows:
· Deposit slip on top
· Next, all checks
· Under that, all bills, neatly strapped
· On the bottom, the envelope of coins
If you do your deposit in a neat and efficient manner, you will represent yourself to your bank as a responsible professional. DO IT!
NSF or Bouncing Checks
Legislation was passed in 1989 which enables a Municipality to levy a service charge on checks that are returned for insufficient funds.
If for no other reason than to recoup costs involved in tracking down the maker of the check, it is worth your effort to make use of this legislation.
A resolution of your town board is necessary; the charge cannot exceed $15.00. Once adopted, the bad check charge may be applicable for all departments within your town.
(There
is legislation before the NYS Legislature that may change this in 2001)
Balancing Act
At one of the training meetings of Tax Receivers & Collectors one of the speakers made a passing comment on how to detect slides and transpositions. We perked up! We knew all about transpositions (sadly, who doesnt?) but slides? We werent sure. At another meeting the Office of the State Comptroller provided us with the details, and because the information has proved so helpful to many of us, we share it now with you. (See how valuable these statewide training meetings can be?)
Definitions:
Transposition: The reversing of the
positions of two digits of a number when the digits reversed are side by side.
$27 - $72; $1234.56 - $1243.56; $5,396.75 - $3,596.75
Slide: The movement of a number right or left
one or more decimal points.
$100 - $1,000 $520 - $52 $19,500 - $195
(detection and calculation on
the next two pages)
7
Detecting a Transposition
Correct Amount $5,396.75
Written As $3,596.75
Difference $1,800.00
Question: is difference divisible by 9?
Answer: 1,800 divided by 9 = 200 (exclude zeros)
The above illustrates three characteristics of a transposition.
· The total of the digits comprising the difference (1800) always equals nine (1+8 =9).
· The number of the digits in the difference (excluding zeros to the right of the decimal) indicates the location of the transposition.
· By dividing the difference by 9 we find the difference between the two digits transposed (e.g., 5 3 = 2).
Total Cash Received Adding Machine Tape
Tax Receipts
$198.23 $198.23
$234.66 $234.66
$119.72 $119.72
$344.98 $344.98
$126.42 $126.42
$152.35 $152.35
$ 95.48 $ 95.48
$457.26 $457.26
$177.43 --- (540) --- $717.43
$185.64
$185.64
$2,092.17 ---(540) --- $2,632.17
--60
9 : 540
54
Difference between the two totals is 540 (5+4=9) Divisible by 9 Yes 60
Location: between 2nd & 3rd digit Difference between digits transposed 6 (1-7)
8
Detecting a Slide
Correct Amount $5,860.00
Written As $ 586.00
Difference $5,274.00
Question: is difference divisible by 9?
Answer: 5,274 divided by 9 = 586
Note: that the digits of the difference (5, 2, 7, 4) do not add to 9. This is a definite indication of a slide rather than a transposition. However, the digits of the difference in a slide may add to 9 in some cases (e.g., when the numbers involve 100 written as 1,000 or 1,000 written as 10,000, etc.).
The result of dividing the difference by 9 indicates the number in which the slide occurred.
Total Cash Received Adding Machine Tape
Tax Receipts
$1450.26 $1450.26
$2234.66 $2234.66
$3119.72 $3119.72
$1344.98 $1344.98
$2126.42 $2126.42
$3152.35 $3152.35
$1095.48 $1095.48
2190.23 ---1971.00 --- $ 219.23
$3177.43 $3177.43
$1185.64
$1185.64
$21077.17 ---1971,00 --- $19106.17
219
9 - 1971.00
18
17
9
81
Difference between the two totals is $1971.00
Divisible by 9 Yes 219
9
If Taxes Are Not Paid
Real Property Tax Law, §987 mandates that we send second notices regarding unpaid town and county taxes within 30 days of the expiration of the warrant. A suggested wording appears in your LGB under the heading Notice of Unpaid Taxes.
The town board may adopt a local law or resolution imposing up to $2 to be added to the taxes, to cover cost of mailing of each such notice under section 987(1) of the RPTL. When the town board requires this charge, it becomes part of the total amount due and cannot be waived. No additional charge is authorized for sending a copy of the third party under Real Property Tax Law, §923.
REMEMBER: sending the notice is mandatory
charging for it is optional with the Town Board
Plant a Money Tree
The next best thing to making money for yourself is making money for your town and your taxpayers. A few years ago, it became possible to do just that. Legally, too! We may deposit tax monies in interest-bearing accounts at your bank. Shop around to see where you can get the best deal. It will take a little extra work on your part, but its worth it.
You must still make payments to your town supervisor and to the county in a timely manner, and weekly payments to your school district(s).
You may wish to investigate the possibility of investing collected tax monies in an account beyond your local bank. A CLASS account with MBIA is a reliable standout among the possibilities.
REMEMBER: The Town Board designates
banks and authorizes investments, while the School Board does the same for
school tax collections.
10
No
No
? Never Accept two-party Checks.
? Never accept a check for more than the amount of the tax, and then give change in cash.
? If payment is made in a penalty period,
and the amount of payment does not include
the penalty, do not accept payment.
You have no authority to waive penalties.
Partial
Payment of Taxes
In 1994, our response to the taxpayer who asked to pay a part of a bill was like the song: With Me, Its All or Nuthin. As a result of efforts by several county tax organizations and our own NYSATRC, legislation passed in August 1994 made it possible to make partial payments for the first time.
Not to be confused with installment payments, partial payments offer relief to the taxpayer who cannot pay the entire bill. This is not an automatic option; it must be passed by county resolution to be put into effect.
A little extra effort is required by the tax office, but is well worth the relief offered to the taxpayer.
REMEMBER: Partial payments of town and
county taxes must be authorized by the
Nice
to Have
On the frequent occasions when you will have to send written correspondence, you will want to present as good an appearance as possible.
Prices on printed stationery vary considerably, and you will want to investigate thoroughly before placing an order. Letterhead should include:
· Name of your Town
· Your Name
· Your Title
· Your address and phone number
If you decide against ordering your own letterhead, be sure that you have a supply of Town letterhead available for your use.
While investigating the cost of letterhead, look into having business cards printed. In addition to being very useful, they give an efficient, professional finish to your contacts.
11
The Ultimate in Handy Helpers
While
mentioning handy helpers
there is one right at the other end of your phone:
the
OFFICERS & BOARD OF DIRECTORS OF NYSATRC
2000-2001