Judge Cancels Tax Liability Notice in New York

A state administrative law judge voided a tax demand due to procedural errors by the Division of Taxation.

Updated on Oct. 23, 2026 in Taxes

Judge Cancels Tax Liability Notice in New York

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Should government agencies be strictly required to follow all procedural rules when issuing tax notices?

On September 3, 2026, an Administrative Law Judge canceled a sales tax liability notice issued to taxpayer Lynn Calvano. The ruling in Matter of Calvano states the New York State Division of Taxation failed to follow mandatory statutory assessment procedures.

Why it matters

The ruling highlights the requirement for tax authorities to adhere strictly to statutory procedures before issuing a Notice and Demand to taxpayers. By bypassing the mandatory Notice of Determination, the state agency invalidated the enforcement action against the taxpayer.

The ruling identified as DTA No. 851521 confirms that the state failed to issue a required Notice of Determination before proceeding. This procedural oversight renders the subsequent Notice and Demand legally unenforceable.

The players

Lynn Calvano

She served as an officer of Landmark Unlimited Inc. and acted as the taxpayer challenging the state's tax assessment procedure.

New York State Division of Taxation

This is the state agency responsible for the administration and enforcement of tax laws in New York.

The details

Lynn Calvano, who served as an officer of Landmark Unlimited Inc., successfully challenged the state's procedural handling of her case through a motion for summary determination. While Calvano did not contest her status as a responsible person for the corporation, the judge ruled the tax demand was unauthorized due to the agency's failure to follow prior tax assessment steps.

The Administrative Law Judge issued the determination in Matter of Calvano on September 3, 2026.

Market Dynamics

This case follows the established statutory guidelines for tax assessment procedures in New York. The ruling reinforces the necessity of strict procedural compliance for state agencies when initiating tax collection efforts against corporate officers.

Taxpayers should be aware that state agencies are obligated to follow defined procedural steps before issuing tax demands. If you receive a notice, verifying that the agency followed the mandatory statutory assessment process can be critical for your defense.

The takeaway

This decision emphasizes that procedural accuracy is as important as substantive tax law in regulatory enforcement. Taxpayers should ensure they review the full procedural history of any state tax notice they receive to check for missed legal requirements.