FRANCHISE INDUSTRY GRANTED DEADLINE EXTENSION TO A NEW REPORTING LAW IN NEW YORK
WASHINGTON, Aug. 7, 2009—The State of New York is making changes to its new franchisor information reporting rule that should make it less burdensome for franchisors to comply, the International Franchise Association said today.
IFA was notified by the New York State Department of Taxation and Finance that, in response to an IFA request, that it was extending the compliance deadline by creating an automatic 90-day extension process for the initial as well as all future reporting deadlines. Prior to the initial deadline (set by the Legislature for September 20) the department will post on its
websiteinstructions to request an automatic 90-day extension to December 20, 2009. All future annual deadlines, which were to be due March 20, will be given similar treatment, meaning that if a franchisor requests the extension all annual reports will be due June 20. Permanently moving these deadlines, rather than creating an extension process, would have required an act of the New York State Legislature.
“We are pleased that the New York officials considered some of our concerns as they work to implement this new law,” said IFA Vice President of Government Relations David French. “We will continue to work with New York officials to ensure that the law’s implementation is fair and reasonable.”
IFA made the deadline extension request in a July 20,
letter to Acting Commissioner of the New York State Department of Taxation and Finance Jamie Woodward about the new law, which for the first time requires franchisors to submit annual transaction information pertaining to their franchisees electronically to the New York State Department of Taxation and Finance.
The State of New York made other announcements regarding the law’s implementation, including:
- The Department has dropped the requirement that franchisors report to the state sales made by “designated” or approved suppliers to New York franchisees. However, sales of supplies from a franchisor or its affiliates directly to a New York franchisee must still be reported.
- If the franchisee currently reports gross sales to the franchisor, this information must be supplied to the state in the required reports. If a different performance measure is used (such as room-nights in lodging or cents-per-gallon of product in food service) that calculation must be explained and, where possible, the quantitative data for the relevant reporting period supplied to the state.
- The requirement that franchisors report to the state the name, address and New York certificate of authority or federal tax identification number of the franchise remains in effect.
In the coming days, the department will post on its website the standardized form franchisors must use to report the required information.
About the International Franchise Association
The International Franchise Association, the world’s oldest and largest organization representing franchising, is the preeminent voice and acknowledged leader for the industry worldwide. Approaching a half-century of service with a growing membership of nearly 1,300 franchise systems, 10,000-plus franchisees and more than 500 firms that supply goods and services to the industry, IFA protects, enhances and promotes franchising by advancing the values of integrity, respect, trust, commitment to excellence, honesty and diversity. For more information, visit the IFA Web site at