Capoccia v. New York State Tax Com'n
| Decision Date | 18 October 1984 |
| Citation | 105 A.D.2d 528,481 N.Y.S.2d 476 |
| Parties | In the Matter of Donald A. CAPOCCIA, Petitioner, v. NEW YORK STATE TAX COMMISSION, Respondent. |
| Court | New York Supreme Court — Appellate Division |
Griffith & Engelbrecht, Rome (Charles W. Engelbrecht, Rome, of counsel), for petitioner.
Robert Abrams, Atty. Gen., Albany (Julie S. Mereson, Albany, of counsel), for respondent.
Before KANE, J.P., and MAIN, MIKOLL, YESAWICH and HARVEY, JJ.
Proceeding pursuant to CPLR article 78 () to review a determination of the State Tax Commission which sustained a personal income tax assessment against petitioner.
From its inception in 1968, petitioner has been president and a principal shareholder of a small corporation engaged in the construction business. His corporate responsibilities and duties consisted of securing construction jobs and supervising them at the site. Charles Balog, an accountant, the other principal in the enterprise, was the corporate secretary-treasurer. His function was to maintain the corporate books and records. Although petitioner had access to the books and records, he elected to concern himself only with the corporation's field operations; he explained this disinterest in the corporation's books by declaring, "I just don't understand that crap." In the latter part of 1975, the corporation encountered financial difficulties culminating in insolvency the following year. Because the corporation had failed to pay over to the State Tax Commission employee withholding taxes due for 1975 and 1976, a notice of deficiency totaling $6,072.60 was issued to petitioner and, following a hearing, he was found to be personally liable for the unpaid taxes.
As urged before the Tax Commission, petitioner maintains that because of the division of responsibility between himself (the "outside man") and Balog (the "inside man"), he is not a "person", as that term is defined by subdivision (n) of section 685 of the Tax Law, required to collect and pay over withholding taxes due from the corporation and further that he did not "willfully" neglect to do so. Whether one is a person obliged to collect, account for and pay over withholding taxes is a factual issue, resolution of which turns on such factors as whether the taxpayer owned stock, signed the tax returns, exercised authority over employees and assets of the corporation,...
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