Skip to main content

Voluntary Disclosure and Compliance Program - Limited Look-Back

Limited look-back clause

If you owe taxes for more than three years, you may request a limited look-back clause during the online Voluntary Disclosure and Compliance (VDC) program application process. This will allow you to voluntarily disclose your entire tax liability but only file returns and pay the tax and interest due in full (penalties will be waived) for the look-back period.  However, a six year look-back will be imposed in instances of non-filing for 20 years or greater.  All look-back determinations are made on a case-by-case basis from the information provided in the disclosure statements.

In turn, we will not require you to file returns for tax years or periods prior to the look-back period, or seek recovery for that earlier period for the particular type of tax violation disclosed. We may audit you for other taxes unrelated to the disclosure for periods prior to the look-back period.

Limited look-back period eligibility

We will consider adding a limited look-back clause to your VDC agreement under certain circumstances.


Collected sales and withholding tax (trust taxes) not remitted to the state

Tax fraud or tax evasion (other than collected trust taxes)

Mistake, confusion, ignorance of the law, inability to comply, or some other similar explanation (other than cases involving collected trust taxes)

Look-back period with full payment requirement

The shorter of six years or the period that begins with the earliest date on which the tax was collected or withheld and ending with the most recently completed tax period

Six-year look-back period

Three-year look-back period

How to apply for a limited look-back clause

To request a limited look-back clause as part of your VDC agreement, you must explain why you owe back taxes and may be eligible for the limited look-back period in the narrative section of your online application.

We will contact you (or your representative) if we need additional information or to discuss whether the limited look-back period requested is acceptable to the Department.

Taxpayer protections: Full voluntary disclosure versus limited look back

If you desire the strongest protection from possible criminal prosecution, you should make the broadest disclosure and not request a limited look-back clause in your VDC application. You must also comply with the terms of your compliance agreement.

Full voluntary disclosure protections

No New York State prosecutor or district attorney can bring criminal tax prosecution against you for a fully disclosed and paid tax liability under this program.

The Department cannot share any disclosure you make with any other agency or use it against you as evidence in any criminal action or proceeding brought against you.

Limited look-back clause protections

You will receive the full voluntary disclosure protections for the look-back period.

You will receive the Department’s promise that it will:

  • limit its review to the look-back period;
  • not look back beyond that period for anything else for the tax issue being disclosed; and
  • not refer you for criminal prosecution for conduct disclosed.

Because you will not be granted full voluntary disclosure protection, you will not receive protection from criminal prosecution brought by other agencies or prosecutors for the periods prior to the look-back period.

Look-back period for the disclosure of interest and/or investment income received from foreign bank accounts

  • a minimum of six years if you held the account for six years or more
  • the number of years you held the offshore account if it was less than less than six years
  • also, if you are participating in the Internal Revenue Service (IRS) Offshore Voluntary Disclosure Initiative (OVDI) program, the look-back period will be equal to the tax years that were required to be filed with the IRS