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Calculating NY PrompTax payments

This article applies to:Avalara Returns

Some businesses are required to participate in the New York PrompTax electronic filing and payment program. This generally applies to businesses with annual sales and use tax liabilities greater than $500,000. The NY Department of Taxation and Finance notifies you by mail if you're required to participate. Learn how Avalara calculates the PrompTax payment amount.

Understanding NY PrompTax payment calculations

Avalara uses the Estimated method to calculate NY PrompTax, which requires an extra payment on the quarterly return. The Estimated method calculates the payment from at least 75% of one-third of your liability for the comparable quarter of the preceding year.

The first two months of every quarter, Avalara pays the exact sales tax liability reported by the customer. On the quarterly return, there is an additional amount prepaid for the next quarter.

  • This additional payment occurs only on quarterly cycles.
  • For more information, review form TR-682-N.

Example

A business uses the Estimated method to calculate the PrompTax payment due January 2014. The tax liability for the comparable quarter of the previous year (December 2012 through February 2013) was $3 million. The calculation would be as follows: ($3,000,000 ÷ 3) x .75 = $750,000.

You can also use this spreadsheet to calculate PrompTax payment amounts.

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