TAXPAYER NOTICE: Attorney General James Reminds Crypto Investors to Pay Taxes on Virtual Investments

 

Ahead of Tax Deadline, AG James Cautions Crypto Investors That

Failure to Pay Taxes Could Have Legal and Financial Consequences

AG James Encourages Whistleblowers to Come Forward With Information About Noncompliance

 New York Attorney General Letitia James today issued a warning to virtual currency investors and their tax advisors to make sure that they accurately declare and pay taxes on their virtual investments. Deliberate or reckless failure to properly declare and pay taxes on cryptocurrency transactions may constitute civil or criminal violations of the tax law, as well as violations of tax provisions of the New York False Claims Act, which could result in steep financial liabilities. As the tax filing deadline approaches, Attorney General James encourages crypto investors to consult and follow guidance from the Department of Taxation and Finance (DTF) and the Internal Revenue Service (IRS) to accurately file their taxes and avoid penalties.

“Crypto investors, just like working families and everyone else, must pay taxes,” said Attorney General James. “Cryptocurrencies may be new, but the law is clear: Investors must accurately report and pay taxes on their virtual investments. My office is committed to holding cryptocurrency tax cheats accountable. Paying taxes on crypto transactions is not optional, and investors who skirt the law can face serious consequences. I encourage all crypto investors to follow guidance from the IRS and the New York State Department of Taxation and Finance to make sure their filings are accurate. Don’t evade the law, pay your taxes.”

IRS and DTF Guidance on Cryptocurrency Taxability

Recently there has been a dramatic surge in the production, sale, and acquisition of “virtual” or “crypto” currencies such as Bitcoin and Ethereum. Transactions involving the acquisition, sale or exchange of cryptocurrency have tax consequences which may trigger tax liability. As set forth in IRS Notice 2014-21 and related DTF guidance, convertible virtual or cryptocurrency is treated as property rather than a currency for U.S. federal tax purposes. Therefore, general tax principles applicable to property transactions apply to transactions using virtual currency. This means that virtual currency is taxed in the same way as any other assets, such as stocks and gold.

Additionally, the IRS notes that taxpayers who receive “virtual currency as payment for goods or services, must, in computing gross income, include the fair market value of virtual currency, measured in US dollars, as of the date that virtual currency was received.” An exchange of virtual currency for other property results in either a gain or loss that must be reported by taxpayers. For example, taxpayers must calculate and report any gain or loss when using cryptocurrency to purchase a luxury electric vehicle, a plane ticket, or even a cup of coffee.

Finally, retailers and purchasers spending or accepting cryptocurrency need to be aware that DTF guidance makes clear that sales tax is owed on transactions involving the use of convertible virtual currency to pay for taxable goods or services delivered in New York state.

Taxpayers should carefully review this guidance and other principles set out in the IRS and DTF guidance in determining tax due on their cryptocurrency transactions.

Consequences of Failure to Pay Taxes on Cryptocurrencies

The consequences of a taxpayer’s failure to properly report income derived from transactions involving cryptocurrency are potentially far-reaching and severe. Such failure may carry significant civil or criminal penalties and can, in certain instances, result in criminal prosecution. Further, a deliberate or reckless failure to comply with the federal and state reporting obligations involving cryptocurrency may also result in taxpayer liability under the New York False Claims Act, which carries with it triple damages, interest, and penalties.

New York False Claims Act liability may also extend to tax professionals advising clients about the taxability of cryptocurrency transactions. For example, advisers that knowingly or recklessly make or cause to be made a false statement material to a taxpayer’s obligation to pay tax may be liable under New York law.

Ensuring that taxpayers appropriately declare and pay taxes on cryptocurrency transactions is a priority for the attorney general. Attorney General James encourages whistleblowers to come forward with any information about noncompliance. 

Anyone with information relating to a taxpayer’s willful failure to report income or collect sales tax on transactions involving cryptocurrency are urged to report such failure to the Office of the Attorney General using the online whistleblower portal.

Governor Hochul Updates New Yorkers on State's Progress Combating COVID-19 - MARCH 22, 2022

 7-Day Average Positivity is 1.78% - Lowest in Four Days

950 Hospitalizations - Under 1,000 for Five Consecutive Days

7 COVID-19 Deaths Statewide Yesterday

 Governor Kathy Hochul today updated New Yorkers on the state's progress combating COVID-19.

"We are moving forward safely through this pandemic thanks to New Yorkers getting vaccinated," Governor Hochul said. "The booster improves your protection against new variants, and I'm calling on New Yorkers who haven't yet -- and are eligible -- to sign up and get boosted as soon as you can. The booster is a critical tool to continue our progress and keep both cases and hospitalizations down."

Today's data is summarized briefly below:

• Test Results Reported - 63,513
• Total Positive - 1,497
• Percent Positive - 2.36%
• 7-Day Average Percent Positive - 1.78%
• Patient Hospitalization - 950 (+49)
• Patients Newly Admitted - 129
• Patients in ICU - 162 (+3)
• Patients in ICU with Intubation - 71
• Total Discharges - 289,527 (+73)
• New deaths reported by healthcare facilities through HERDS - 7
• Total deaths reported by healthcare facilities through HERDS - 55,057

The Health Electronic Response Data System is a NYS DOH data source that collects confirmed daily death data as reported by hospitals, nursing homes and adult care facilities only.

• Total deaths reported to and compiled by the CDC - 70,062

This daily COVID-19 provisional death certificate data reported by NYS DOH and NYC to the CDC includes those who died in any location, including hospitals, nursing homes, adult care facilities, at home, in hospice and other settings.

• Total vaccine doses administered - 37,333,275
• Total vaccine doses administered over past 24 hours - 11,239
• Total vaccine doses administered over past 7 days - 91,939
• Percent of New Yorkers ages 18 and older with at least one vaccine dose - 91.9%
• Percent of New Yorkers ages 18 and older with completed vaccine series - 83.3%
• Percent of New Yorkers ages 18 and older with at least one vaccine dose (CDC) - 95.0%
• Percent of New Yorkers ages 18 and older with completed vaccine series (CDC) - 86.0%
• Percent of New Yorkers ages 12-17 with at least one vaccine dose (CDC) - 82.3%
• Percent of New Yorkers ages 12-17 with completed vaccine series (CDC) - 72.4%
• Percent of all New Yorkers with at least one vaccine dose - 81.4%
• Percent of all New Yorkers with completed vaccine series - 73.7%
• Percent of all New Yorkers with at least one vaccine dose (CDC) - 89.4%
• Percent of all New Yorkers with completed vaccine series (CDC) - 76.0%

Each New York City borough's 7-day average percentage of positive test results reported over the last three days is as follows:

BOROUGH	Saturday, March 19, 2022	Sunday, March 20, 2022	Monday, March 21, 2022
Bronx	0.83%	0.84%	0.66%
Kings	1.38%	1.40%	1.16%
New York	2.03%	2.11%	1.87%
Queens	1.17%	1.20%	1.04%
Richmond	1.11%	1.19%	1.07%

DEC AND ADIRONDACK MOUNTAIN RESERVE PLAN FOR 2022 SEASON AFTER SUCCESSFUL FIRST YEAR FOR PILOT RESERVATION SYSTEM

 

System Registers 21,000 Users and 16,000 Reservations During 2021 Season Parking Reservations Required May 1 to Oct. 31

 The New York State Department of Environmental Conservation (DEC) and Adirondack Mountain Reserve (AMR) today announced that the pilot parking reservation system launched last spring to promote safe access to trails in the Route 73 corridor will resume May 1, following a successful inaugural year. More than 21,000 users registered at www.hikeamr.org to make parking reservations that help protect public safety and improve visitors’ trip planning and preparation by ensuring guaranteed parking upon arrival.

 

From May 1 through Oct. 31 this year, reservations will again be required to access the parking lot, trailheads, and trails located on the privately owned, 7,000-acre AMR property in the town of Keene in the High Peaks region. The Reserve has a longstanding conservation easement with DEC that allows public access for hiking. Additional hiking opportunities and parking lots can be found throughout the 2.6 million acres of public lands within the Adirondack Forest Preserve on a first-come, first-served basis.

 

“DEC and the Adirondack Mountain Reserve are gearing up to launch the second year of our parking reservation partnership using the valuable input shared by hikers, local leaders, and other stakeholders committed to making the Adirondacks safer and more accessible,” DEC Commissioner Basil Seggos said. “Tens of thousands of hikers and visitors successfully used the system last year and we will continue to work with AMR and others to build upon the progress we’ve made to encourage the safe, sustainable use of our trails to benefit both the recreating public and our natural resources.”

 

“We are very pleased with the results of the first year of the reservation system which was able to meet and exceed the three primary goals of the pilot: (1) to improve the safety for all those who travel the Route 73 corridor, (2) to provide fair and equitable access to parking for all levels of the hiking community and (3) to preserve and protect both public and private lands for future generations,” said John Schuler, General Manager of the Adirondack Mountain Reserve. “The mission of the Adirondack Mountain Reserve, as stated in our Conservation Easement, is to preserve and protect the forests, lakes, mountain streams, and wildlife on our lands, and we believe that our partnership with the DEC on the pilot parking reservation system is supporting our efforts to continue to carry out our mission. We are confident the second year will be even more successful.” 

 

In its first year, the pilot parking reservation system accepted registrations from 14,200 New Yorkers, 6,600 registrations from people residing out of state, and 138 people from other countries. One-hundred-and-thirteen Canadian users registered last year, a reflection of border crossing restrictions in place during the COVID-19 pandemic. This number is expected to increase as restrictions are lifted.  

 

Advanced parking reservations at AMR are available at no-cost and must be obtained for single-day or overnight use, getting dropped off or picked up in the AMR lot by a vehicle, or arriving by bicycle. Seventy reservations, including overnight reservations, are available per day. Walk-in users without a reservation are not permitted unless these users can provide a Greyhound or Trailways bus ticket from within the past 24 hours. Reservations are also required for access to the Noonmark and Round Mountain trailheads located on AMR property.  

 

Reservations can be made as far as two weeks in advance. New bookings for 2022 will open on April 17, and users will be able to make reservations 14 days out on a 24-hour rolling basis.

 

When compared to previous years, 2021’s reservation system resulted in visitor use at AMR more equally distributed throughout the week. This information is valuable in helping DEC and AMR determine if the pilot system is reducing the heavy use typically experienced on weekends or holidays, and if dispersing visitors will help both minimize natural resource impacts from crowded trails and provide visitors with a more natural experience. In addition to multi-agency efforts to reduce dangerous and illegal parking in the vicinity, the pilot reservation program also dramatically reduced traffic congestion and the number of pedestrians walking on or along Route 73, a public safety issue.

 

Since the program launched in April 2021, DEC and AMR made several updates to improve access and the user experience. AMR installed an automatic one-way gate to allow for late departures from the parking lot. AMR also implemented e-mail reservation reminders to help reduce the number of no-shows. Shortly after launch, the number of individuals permitted per reservation was increased to eight and the booking window was adjusted, allowing reservations to be made up to 12 hours in advance. AMR also moved the start time for the rolling two-week opening of future dates from midnight to noon.

 

DEC and AMR continue to work together to adaptively manage the pilot to improve public safety, ensure equitable access, and promote sustainable use of this popular hiking destination. Learn more about the Adirondack Mountain Reserve on DEC’s website. For a list of frequently asked questions and to register, visit www.hikeamr.org. Reservations will open April 17, 2022.

Attorney General’s Office of Special Investigation Opens Investigation Into Civilian Death in Rochester

 

The New York Attorney General’s Office of Special Investigation (OSI) has opened an investigation into the death of Janet Jordan, who died on March 14, 2022.

On the morning of March 14, 2022, Ms. Jordan was found dead in her residence on Wetmore Park in Rochester. OSI is conducting an investigation to determine whether her death, by gunshot, was caused by a member of the Rochester Police Department who was found dead later that day by self-inflicted gunshot. 

Pursuant to New York State Executive Law Section 70-b, OSI assesses every incident reported to it where a police officer or a peace officer, including a corrections officer, may have caused the death of a person, by an act or omission. Under the law, the officer may be on-duty or off-duty, and the decedent may be armed or unarmed. Also, the decedent may or may not be in custody or incarcerated. If OSI’s assessment indicates an officer caused the death, OSI proceeds to conduct a full investigation of the incident.

These are preliminary facts and subject to change. 

MAYOR ADAMS REAPPOINTS CECILE NOEL AS MAYOR’S OFFICE TO END DOMESTIC AND GENDER-BASED VIOLENCE COMMISSIONER

 

  New York City Mayor Eric Adams today announced the reappointment of Cecile Noel as commissioner of the Mayor’s Office to End Domestic and Gender-Based Violence (ENDGBV). In that role, she will continue the office’s work of coordinating a citywide response to domestic and gender-based violence, enhancing prevention efforts, and developing innovative and responsive programming to support survivors throughout New York City. 

Domestic and gender-based violence includes intimate partner violence, family violence, sexual violence, stalking, human trafficking, female genital mutilation/cutting, and other forms of gender-based violence.

 

“Domestic and gender-based violence is another public health crisis that has been exacerbated by the COVID pandemic, and we must take a coordinated, holistic approach to addressing it,” said Mayor Adams. “Cecile Noel has spent her career advocating for survivors and victims, and I am proud to reappoint her as commissioner to deepen the efforts of ENDGBV.”

 

“It is difficult to articulate the impact domestic and gender-based violence has on children, adults, and families; my heart breaks for every New Yorker touched by these issues,” said Deputy Mayor for Health and Human Services Anne Williams-Isom. “Know that we are here to uplift and support you, and Commissioner Noel is committed to reaching every person and family in need. I commend her service, look forward to continuing to work together, and am grateful for the whole team at ENDGBV.”

 

“I am honored and grateful for the opportunity to continue to lead the city’s response to domestic and gender-based violence,” said ENDGBV Commissioner Noel. “Alongside our critical partners and with my incredible team, ENDGBV will continue to enhance responses to meet the needs of survivors in every community and strengthen prevention efforts so that we can work toward a goal of ending gender-based violence in New York City. I look forward to working with Mayor Adams, Deputy Mayor for Health and Human Services Anne Williams-Isom, and my colleagues across all sectors to continue to innovate and coordinate our approaches, while ensuring unwavering support for survivors.”

 

“Commissioner Noel has been a vital partner through my many years of city service, as she has worked tirelessly toward our shared goal of serving and uplifting some of New York’s most vulnerable communities,” said Department of Social Services Commissioner Gary P. Jenkins. “This administration’s recognition of her invaluable role in addressing domestic and gender-based violence is a testament to her strong leadership and incredible dedication to serving New Yorkers in need. As she continues to lead this critical effort, I look forward to working together to combat one of the key drivers of homelessness, as we build a more inclusive, equitable, and safe city for all New Yorkers.”

 

“I am so pleased that Mayor Eric Adams has reappointed Cecile Noel to continue the city’s efforts to end domestic and gender-based violence as the commissioner of ENDGBV,” said Administration for Children’s Services (ACS) Commissioner Jess Dannhauser. “In my work with young people and families, I have often relied on Commissioner Noel’s vast expertise and abiding support. We at ACS look forward to continuing to build our partnership and collaboration, to keep children and families safe.”

 

“Cecile Noel has been a tremendous partner with my office, supporting our numerous domestic violence initiatives and coordinated trainings and consistently participating in our annual 5k Run/Walk/Roll for Domestic Violence Awareness,” said Bronx District Attorney Darcel D. Clark. “Our collaboration has been instrumental in successfully providing services for survivors through the co-located Bronx Family Justice Center. She has shown innovative approaches to preventing and stemming this sensitive, traumatic crime that plagues the Bronx more than other boroughs.”

 

“The Mayor’s Office to End Domestic and Gender-Based Violence plays an essential role helping vulnerable victims escape abuse, neglect, and violence, and Commissioner Cecile Noel has been an outstanding partner with my office,” said Brooklyn District Attorney Eric Gonzalez. “A tireless advocate and skilled leader, Commissioner Noel has worked to ensure that our Family Justice Center provides a safe, one-stop resource for victims. She has also collaborated with us to develop inclusive programs to prevent violence and abuse, and to help survivors reclaim their lives. The people of our city will benefit greatly from her continued service leading this vital agency, and I commend Mayor Adams on his outstanding choice.”

 

“We applaud Mayor Adams’ decision to reappoint Commissioner Noel. My office has worked closely with her on several initiatives to ensure that all survivors of domestic and gender-based violence know that they are not alone,” said Queens District Attorney Melinda Katz. “Together, we have ensured that survivors have access to safety planning, shelter assistance, and counseling. We are grateful for Commissioner Noel’s leadership and look forward to continuing to strengthen our partnership with the Mayor’s Office to End Domestic and Gender-Based Violence.”

 

NYC Comptroller’s Office Analysis Finds Bail Continues to Drive Pretrial Detention, Despite Reforms

 

Data Shows No Change in Share of People Rearrested While Awaiting Trial in the Community, Even As Reforms Reduced the Number of People Subject to Bail.

Comptroller Lander Calls for Albany to Reject Rollbacks and Instead Strengthen Implementation.

 Despite reforms that have meaningfully reduced the number of people subject to bail, bail-setting continues to drive pretrial detention and syphons money from low-income communities of color, according to a new analysis from the NYC Comptroller’s office. The share of people released pretrial who are rearrested for a new offense has not changed following the implementation of bail reforms.  

While judges set bail in 14,545 cases in calendar year 2021, down from 24,657 in 2019, defendants and their friends and family still posted $268 million in bail, up from $186 million in 2020. The data on the impacts of the 2019 bail reforms shows that, despite new requirements to consider the ability of defendants to pay in those cases where bail still applies, a full two years into implementation, the 2019 reforms have neither made bail more affordable nor prevented incarceration for those still subject to bail setting. 

Even as the number of people subject to bail has declined, there has been no increase in the number or percentage of people who are rearrested for a new offense while awaiting trial in the community. In January 2019, 95% of people awaiting trial in the community were not rearrested that month, while that proportion rose slightly to 96% in December 2021. Both before and after bail reform, fewer than 1% of people released pretrial, either through bail or otherwise, were rearrested on a violent felony charge each month. 

Rather than roll back critical reforms, the Comptroller’s office urged Albany legislators to strengthen implementation and invest in programs that prevent crime and promote community safety. 

“In a moment of real anxiety about public safety, the conversation on bail reform has become divorced from the data, which shows essentially no change in the share of people rearrested while released pretrial before and after the implementation of the 2019 bail reforms,” said Comptroller Brad Lander. “Instead, what we see is a rise in average bail amounts and a continuation of bail-setting practices that extract money from families and deny freedom to people who are presumed innocent before trial. We should follow the facts rather than fear, and reject reactive efforts to roll back reforms that threaten the progress we have made towards more equal justice. Our system has put a high price on freedom and made bail a barrier to justice for those who cannot afford to pay.” 

The Office of the New York City Comptroller analyzed data provided by the New York State Office of Court Administration on bail setting and bail made, as well as data on pretrial release outcomes from the New York City Criminal Justice Agency during calendar years 2019, 2020 and 2021 to assess the actual impacts of the 2019 bail reforms and the 2020 rollbacks.

Key findings included:

• Since state bail reforms took effect, the number of people subject to bail has significantly declined but bail-setting still drives pretrial incarceration. In calendar year 2021, judges set bail in 14,545 cases, down significantly from 24,657 in 2019. Over 2020 and 2021, roughly half of defendants who had bail set were able to eventually make bail, although most defendants are incarcerated for at least some amount of time before doing so.
• The cost of bail increased. Bail reforms that took effect January 1, 2020 included new requirements for judges to consider a person’s ability to pay when setting bail. Yet average bail amounts rose, rather than fell in 2021, and people continue to be unable to afford the price of their freedom.​ In 2021, the average cash bail amount set at arraignment was $38,866, double the $19,162 average in 2019. While increases in average bail amounts likely stem from broad restrictions on setting bail for lower-level charges, bail law explicitly requires judges to consider the defendant’s financial circumstances.
• Commercial bonds that require high, non-refundable fees to private companies continue to be widely used.​ Of bonds posted in 2020 in New York City Supreme Court – the City’s trial court for felony cases – 57% of cases used commercial bonds. In 2021, defendants and their friends and family posted a total of $226 million in bonds, including commercial bail and partially secured bonds, up from $159 million in 2020 but down 3% from $233 million in 2019.
• Less onerous and punitive bail options, such as partially secured or unsecured bonds, were used less often than commercial bonds. Partially secured bonds accounted for 20% of bail postings in Supreme Court during 2020, and judges used the least onerous mechanism, unsecured bonds that require no money upfront, only seven times in 2020, down from 24 times in 2019. The average dollar amount of partially secured bonds posted in Supreme Court jumped substantially, rising from an average of roughly $11,900 from January through November 2019 to an average of more than $40,000 in 2020.
• There has been essentially no change in the monthly percentage of people rearrested while released pending trial after bail reform. In January 2019, 95 percent of the roughly 57,000 people awaiting trial were not rearrested that month. In January 2020, 96 percent of the roughly 45,000 people with a pending case were not rearrested. In December 2021, 96 percent were not rearrested — and 99 percent of people, regardless of bail or other pretrial conditions, were not rearrested on a violent felony charge.

The Comptroller’s Office recommends that the New York State Office of Court Administration (OCA) provide guidance and clear instructions to judges on how to assess a defendant’s ability to pay and mandate trainings on this provision of the law. OCA should direct judges to first consider an unsecured bond and justify on the record their reasons for not using that option before setting a partially secured bond.  

To significantly curtail the use of pretrial detention, New York should also advance strategies that address root causes of criminal legal system involvement, redirecting resources from the law enforcement and correctional systems to social supports that promote stability and safety and create economic opportunity, such as mental health care, substance use prevention and treatment, affordable housing, youth programming, and quality education. 

The full analysis report can be viewed here.

WILLIAMS RESPONDS TO THE GOVERNOR'S ATTEMPTS TO RETREAT FROM CRITICAL BAIL REFORMS

 

"The 2019 criminal justice reforms represented a long-overdue move toward justice, away from a predatory cash bail system. The real and concerning rise in some crimes is not a reason to return to the harmful, unjust, failed policies of the past, which have already failed both here and in cities across the country. As the comptroller’s report today makes clear, calls to do so are divorced from the data, and ignore the both harm that these laws were created to prevent and the history our country has of instituting, then apologizing for, unjust systems of criminalization. 

"The Governor is wrong to try to pull back from progress, a move which would criminalize low income New Yorkers and communities of more color and send more people into the crisis conditions she has refused to see at at Rikers Island, where dangerous conditions for everyone have led to pre-trial detention becoming a death sentence. I urge the Legislature to reject this attempt to give in to loud, fearmongering voices, and instead advance a model of true public safety that includes immediate and long-term investments in the same communities that already have the burden of both an increase in crime and inequitable incarceration that has yet to solve the problem."