The implementation of Tax Law Section 663 (see Underwriting Bulletin Number
211 dated August 7, 2003) will likely lead to situations where compliance with
the terms of the statute has not been accomplished prior to closing. In order to
lessen the likelihood (or necessity) of adjourned closings, Stewart Title
Insurance Company will allow Agents to assist in the process of compliance under
the following guidelines.
FIRST, the seller must either present NYS Department of Taxation and
Finance Form IT 2663 (“the Form”) which has been completed prior to closing or
the seller (or her attorney) must prepare and complete Form at the closing
table. Remember that each non-exempt, non-resident seller must
complete her own form. Under no circumstances is a closer, an agent
(or any agency employee) to prepare the Form for the seller or offer any
substantive advice regarding the preparation of the Form.
SECOND, a check is to be collected from the seller
in the amount shown on Line 3 of Part II of the Form (assuming that the amount
is greater than zero). The check is made payable to “NYS Income Tax” and must be
accompanied by a completed payment voucher which is at the end of Page 3 of the
THIRD, Part IV of the Form must be completed, even if there is no tax due. It is
imperative that the name of the agency and the name of an individual employee of
the agency (not an independent contractor) be included. If fax authorization is
requested, fax and phone numbers are required.
FOURTH, each seller from whom the Form
is required must sign an indemnity agreement, in the form provided.
FIFTH, the agent must present the completed Form,
completed voucher, and payment (if any) to the NYS Department of Taxation and
Finance district office/walk in location no later than forty eight hours after
closing and obtain the stamped certification, allowing for the deed to be
It is the responsibility of the agent, or an employee of the agency, to
insure compliance with the above procedure. It is not to be left to an
independent contractor to obtain the certification necessary to enable the deed
to be recorded. Along those lines, it will be permissible for the agent to
charge a fee, reasonable calculated to compensate for the expense involved, for
providing the service comtemplated by this procedure. Page four of the Form
provides a list of district offices/walk in centers where the certification may
be validated by the Department of Taxation and Finance. The distance between the
gaents office and these locations may (and probably should) be considered in
formulating the charge.
As a reminder, the new Form TP 584, where an individual, estate or trust
claims exemption from the provisions of Section 663, must be signed in two
separate places, once after Schedule C (the end of the Real Estate Transfer Tax
Return portion of the form) and a second time at the end of Schedule D, where
the exemption from Section 663 is claimed.