NY A04801

Requires all vendors collecting sales tax to deposit collected taxes into separate escrow accounts held in trust for the New York State Commissioner of Taxation and Finance at a time and manner determined by the Commissioner.

Establishes two escrow account mechanisms: (1) standard bank accounts at state-approved institutions for vendors not accepting credit/debit card payments, and (2) approved credit card processing company (ACCPC) escrow accounts for vendors accepting card payments, with daily deposits based on an algorithmic rate certified by a licensed professional.

Authorizes the Commissioner to debit escrow accounts directly and permits vendors to file annual returns instead of quarterly returns once they demonstrate 95% of taxes owed have been deposited for four consecutive quarters.

Increases the sales tax credit from $200 to $500 per quarterly period and allows credit only when escrow account deposits equal at least 95% of total tax due for the filing period.

Creates penalties of 10% of tax due for initial month of escrow account non-compliance, plus 1% per additional month (capped at 30%), and imposes 50% penalty on deficiencies when escrow deposits fall below 90% of taxes owed; effective September 1, 2012.