Notwithstanding any provision of this Subchapter to the contrary, if a husband and wife file a joint New York State personal income tax return, any excess payment and interest thereon by either spouse may be applied against any past-due sup

(1) amounts attributable to withholding from wages of such spouse will be applied only against the separate liability of such spouse;

(2) amounts attributable to separate payments of estimated income tax by such spouse will be applied only against the separate New York State personal income tax liability of such spouse; and

(3) amounts attributable to joint payments of estimated income tax and amounts attributable to any other payment will be applied against the separate New York State personal income tax liability of each spouse in such proportion as is agreed upon by both spouses; provided, however, that in the absence of any such agreement, such amounts will be applied against the separate New York State personal income tax liability of each spouse in the same proportion which the separate New York State personal income tax liability of each spouse bears to the total New York State personal income tax liability of both spouses. In the absence of an agreement between spouses, the amounts of joint estimated income tax payments and other payments will be apportioned based upon the following formula: separate New York State personal income tax liability of spouse / total New York State personal income tax liability of both spouses × amount of estimated income tax payments For purposes of this subdivision, the separate New York State personal income tax liability of each spouse will be determined by the following formula: New York adjusted gross income of each spouse / combined New York adjusted gross income of both spouses × total New York State personal income tax liability of both spouses Assume that for the calendar year 1987, H had New York State personal income tax withheld from his wages in the amount of $600. W, his spouse, received no income during the year. Additionally, H and W made joint payments of estimated income tax totaling $900. H and W subsequently filed a joint New York State personal income tax return showing a New York State personal income tax liability of $1,300. W had defaulted in repayment of a guaranteed student loan in the amount of $300 and the Department of Taxation and Finance was so notified in accordance with the provisions of section 171-d of the Tax Law. H did not affix to their joint New York State personal income tax return a written demand providing that any overpayment made by him be applied only on account of his separate New York State personal income tax liability. The overpayment of H and W in the amount of $200 ($1,500 less $1,300) will be applied against W's liability for her defaulted student loan. Since the amount owed on the defaulted student loan exceeded the amount of the overpayment, neither H nor W will receive any refund of New York State personal income tax. Assume that for the calendar year 1987, H had New York adjusted gross income of $20,000 and had New York State personal income tax withheld from his wages in the amount of $1,600. W, his spouse, had New York adjusted gross income of $5,000 and had New York State personal income tax withheld from her wages in the amount of $500. Additionally, H and W made joint payments of estimated tax totaling $200. H and W filed a joint New York State personal income tax return showing a combined New York adjusted gross income of $25,000 and a total New York State income tax liability of $836. H had defaulted in repayment of a guaranteed student loan in the amount of $1,200 and the Department of Taxation and Finance was so notified in accordance with the provision of section 171-d of the Tax Law. W affixed to their joint New York State personal income tax return a written demand providing that any overpayment made by her be applied only on account of her separate New York State income tax liability. The overpayments made by each spouse will be treated as follows: