GCM - General City Model 772/66
Section 1. Notwithstanding any other provision of law to the contrary, any city having a population of one million or more, acting through its local legislative body, is hereby authorized and empowered to adopt and amend local laws imposing for any such city taxes on general corporations, financial corporations and transportation corporations at the rates provided herein, or if alternative rates are provided, then, in such event, at either of such rates. The terms of such local law or local laws shall be, substantially, as follows except that any such local law may be amended for the purpose of conforming it with similar provisions of articles 9-A, 27 and 32 (except section 1456 thereof) of the tax law and section 8 of chapter 167 of the laws of 1972 as presently in effect or as they may be amended provided, however, that the definition set forth in subsection (c) of section 1450 of the tax law and the deduction set forth in subsection (f) of section 1453 of the tax law shall be incorporated in any local law imposing a tax such as is imposed by article 32 of the tax law and provided further, that credits analogous to the credits provided in paragraphs (b) and (c) of subdivision 1 of section 4-h of part 2 of this section and subject to the limitations contained in such part, may be incorporated in any local law imposing a tax such as is imposed under article 32 of the tax law, and provided further, that a provision analogous to paragraph 1 of subsection (b) of section 1455 of the tax law, as such paragraph 1 existed immediately prior to its repeal by section 24 of chapter 298 of the laws of 1985 (but subject to the amendments contained in paragraph 2 of subdivision (b) of section 11-643.5 of the administrative code of the city of New York), shall continue to apply to banking corporations organized under the laws of any country other than the United States and provided further, however, that in the event that any local law is adopted imposing a tax such as is imposed by such article 32 of the tax law, then no tax imposed by such city for any periods for which a tax such as is imposed by such article 32 is imposed and the rates of tax under any such local law imposing a tax such as is imposed by such article 32 shall be, for the basic tax analogous to that fixed by subsection (a) of section 1455 of the tax law, no greater than nine per centum, for the alternative minimum tax analogous to that fixed under paragraph 1 of subsection (b) of such section, as such paragraph 1 existed prior to its repeal by section 24 of chapter 298 of the laws of 1985 (but subject to the amendments contained in paragraph 2 of subdivision (b) of section 11-643.5 of the administrative code of the city of New York), no greater than two and six-tenths mills per dollar of issued capital stock or the excess of average total assets over average total liabilities apportionable to such city, for the alternative minimum tax analogous to that fixed under such paragraph 1 as added by section 24 of such chapter, no greater than one-tenth of a mill, for the alternative minimum tax analogous to that fixed by paragraph 2 of such subsection, no greater than three percent, and for the alternative minimum tax analogous to that fixed by paragraph 3 of such subsection, no greater than one hundred twenty-five dollars and except that the appendix in such local laws may be amended for the purpose of conforming it with the United States internal revenue code or other federal laws relating to taxation as presently in effect or as they may be amended, and provided further, however, any such local law imposing a tax such as is imposed by such article 32 may be amended to conform it with the analogous provisions of subparagraph 11 of paragraph (a), subparagraph 13 of paragraph (b) and paragraphs (l), (m) and (n) of subdivision 8 of section 2 of section 1 of this chapter:
CITY BUSINESS TAX PART I GENERAL PROVISIONS Section 1. Definitions. PART II GENERAL CORPORATION TAX Section 2. Definitions. 3. Imposition of tax; exemptions. 4. Computation of tax. 4-a. Credit relating to stock transfer tax. 4-b. Credit relating to certain sales and compensating use taxes. 4-c. Credit relating to certain expenses involved in the cost of relocating industrial and commercial employment opportunities. (4-d) Credit relating to the annual increase in certain payments to a landlord by a taxpayer relocating industrial and commercial employment opportunities. 4-e. Credit relating to certain sales and compensating use taxes. 4-f. Credit relating to certain sales and compensating use taxes on electricity used in manufacturing, processing or assembling. 4-h. Relocation and employment assistance credit. 5. Reports. 6. Payment and lien of tax. 7. Declaration of estimated tax. 8. Payments on account of estimated tax. 9. Collection of taxes. 10. Limitations of time. PART III FINANCIAL CORPORATION TAX SUBPART 1 TAX ON STATE BANKS, TRUST COMPANIES, FINANCIAL CORPORATIONS AND SAVINGS AND LOAN ASSOCIATIONS Section 11. Definitions. *12. Tax based on net income; imposition; minimum tax; new corporations; dissolution; consolidations; mergers; etc. 13. Years for which imposed. 14. Ascertainment of gain or loss. 15. Exchange of property. 16. Exchange of property when no gain or loss is realized. 17. Inventory. 18. Net income defined. 19. Computation of net income. 20. Gross income defined. 21. Deductions. 22. Items not deductible. * Does not conform to section heading in text of law. SUBPART 2 TAX ON NATIONAL BANKING ASSOCIATIONS AND PRODUCTION CREDIT ASSOCIATIONS Section 23. Imposition of tax. 24. Years for which imposed. 25. Ascertainment of gain or loss; exchange of property. 26. Inventory. 27. Net income defined; computation.
28. Gross income defined. 29. Deductions. 30. Administration; procedure; provisions of law applicable. 31. Tax on production credit associations. SUBPART 3 ADMINISTRATION FOR SUBPARTS 1 AND 2 Section 32. Taxpayers' returns. 33. Consolidated returns. 34. Payment of tax. 35. Declaration of estimated tax; payments on account of estimated tax. 36. Real property taxable. PART V TRANSPORTATION CORPORATION TAX Section 61. Tax on transportation corporations and associations. 62. Additional tax on transportation corporations and associations. 63. Receivers, etc., conducting corporate business. 64. Service of process; limitations of time. 65. Exemption of Corporations Owned by a Municipality. 66. Reports of Corporations. 67. Payment of tax and penalties. 68. Taxable years to which taxes apply. 69. First reports for nineteen hundred sixty-six. PART VI (CORPORATE TAX PROCEDURE AND ADMINISTRATION) Section 71. Application of part. 72. Notice of Deficiency. 73. Assessment. 74. Limitations on Assessment. 75. Interest on underpayment. 76. Additions to tax and civil penalties. 77. Overpayment. 78. Limitations of credit or refund. 79. Interest on overpayment. 80. Petition to director of finance. 81. Review of director's decision. 82. Mailing rules; holidays. 83. Collection, levy and liens. 84. Transferees. 85. Jeopardy assessment. 86. Criminal penalties. 87. General powers of director of finance. 88. Secrecy required of official; penalty for violation. 89. Disposition of revenues. 90. Inconsistencies with other laws. 91. Effect of invalidity in part. PART I GENERAL PROVISIONS Section 1. Definitions. When used in parts one through six: 1. "Taxpayer" means any corporation subject to tax; 2. "City" or "the city" means the city imposing the tax; 3. "State," "the state" or "this state" means the state of New York; 4. "Tax commission," "department of state," "department of taxation and finance," "department of public service," and "department of insurance," refers to agencies and departments of the state; 5. "Commission" means the tax commission of the state;
6. "Tax law," "insurance law," "private housing finance law," "public health law," "public housing law," "finance law," "general municipal law," "public service law," "general corporation law," "business corporation law," "civil practice law and rules," "code of criminal procedure," and "banking law," refer to laws of the state; 7. "Attorney General," "superintendent of insurance," "commissioner of taxation and finance," "secretary of state," "commissioner of health," and "comptroller," refer to officials of the state; 8. "Director of finance" means the director of finance or other fiscal officer of the city charged with administration of excise taxes by the charter of the city or by other provision of law. 9. "Domestic corporation" means a corporation organized under the laws of the state; and 10. Unless a different meaning is clearly required, any term used in any title other than parts four and five shall have the same meaning as when used in a comparable context in the laws of the United States relating to federal income taxes, and any reference to the laws of the United States shall mean the provisions of the internal revenue code of nineteen hundred fifty-four, and amendments thereto, and other provisions of the laws of the United States relating to federal income taxes, as the same are included in the title appendix hereinafter set forth or as included by reference to an appendix of another title enacted by the same local law. (The quotation of the aforesaid laws of the United States is intended to make them a part of any appropriate title and to avoid constitutional uncertainties which might result if such laws were merely incorporated by reference. The quotation of a provision of the federal internal revenue code or of any other law of the United States shall not necessarily mean that it is applicable to or has relevance to any of the titles.) 11. "Title," when used in any part except parts four or five, means all parts except parts four or five, and, when used in part four or part five, means the part in which it is used together with part one; provided, however, that, whenever it is used in a manner which clearly shows that it is intended to encompass all parts, it shall be so construed. PART II GENERAL CORPORATION TAX § 2. Definitions. When used in this part: 1. "Corporation" includes a joint-stock company or association and any business conducted by a trustee or trustees wherein interest or ownership is evidenced by certificate or other written instrument; 2. "Subsidiary" means a corporation of which over fifty per centum of the number of shares of stock entitling the holders thereof to vote for the election of directors or trustees is owned by the taxpayer; 3. "Subsidiary capital" means investments in the stock of subsidiaries and any indebtedness from subsidiaries, whether or not evidenced by written instrument, on which interest is not claimed and deducted by the subsidiary for purposes of taxation under this part or part three of this title, provided, however, that, in the discretion of the director of finance, there shall be deducted from subsidiary capital any liabilities payable by their terms on demand or within one year from the date incurred, other than loans or advances outstanding for more than a year as of any date during the year covered by the report, which are attributable to subsidiary capital; 4. "Investment capital" means investments in stocks, bonds and other securities, corporate and governmental, not held for sale to customers in the regular course of business, exclusive of subsidiary capital and stock issued by the taxpayer, provided, however, that, in the discretion
of the director of finance there shall be deducted from investment capital any liabilities payable by their terms on demand or within one year from the date incurred, other than loans or advances outstanding for more than a year as of any date during the year covered by the report, which are attributable to investment capital; 5. "Investment income" means income, including capital gains in excess of capital losses, from investment capital, to the extent included in computing entire net income, less, (a) in the discretion of the director of finance, any deductions allowable in computing entire net income which are attributable to investment capital or investment income, and (b) such portion of any net operating loss deduction allowable in computing entire net income, as the investment income, before such deduction, bears to entire net income, before such deduction, provided, however, that in no case shall investment income exceed entire net income; 6. "Business capital" means all assets, other than subsidiary capital, investment capital and stock issued by the taxpayer, less liabilities not deducted from subsidiary or investment capital which are payable by their terms on demand or within one year from the date incurred, other than loans or advances outstanding for more than a year as of any date during the year covered by the report, except that, subject to the provisions of subdivision six of section four of this part, cash on hand and on deposit shall be treated as investment capital or as business capital as the taxpayer may elect; 7. "Business income" means entire net income minus investment income; 8. "Entire net income" means total net income from all sources which shall be the same as the taxpayer's entire federal taxable income computed without regard to any election under subchapter s of chapter one of the internal revenue code, except as hereinafter provided, and subject to any modification required by paragraph (d) of subdivision three of section four of this part. (a) Entire net income shall not include: (1) income, gains and losses from subsidiary capital which do not include the amount of a recovery in respect of any war loss; (2) fifty per centum of dividends other than from subsidiaries; (3) bona fide gifts; (4) income and deductions with respect to amounts received from school districts and from corporations and associations, organized and operated exclusively for religious, charitable or educational purposes, no part of the net earnings of which inures to the benefit of any private shareholder or individual, for the operation of school buses; and (5) any refund or credit of a tax imposed under this part, or imposed by article nine or article nine-A of the tax law, for which tax no exclusion or deduction was allowed in determining the taxpayer's entire net income under this part for any prior year; (6) in the case of a taxpayer who is separately or as a partner of a partnership doing an insurance business as a member of the New York insurance exchange described in paragraph (a) of subdivision one of section four hundred twenty-five-a of the insurance law, any item of income, gain, loss or deduction of such business which is the taxpayer's distributive or pro rata share for federal income tax purposes or which the taxpayer is required to take into account separately for federal income tax purposes. (7) for taxable years beginning after December thirty-first, nineteen hundred eighty-one, except with respect to property which is a qualified mass commuting vehicle described in subparagraph (D) of paragraph eight of subsection (f) of section one hundred sixty-eight of the internal revenue code (relating to qualified mass commuting vehicles), any amount
which is included in the taxpayer's federal taxable income solely as a result of an election made pursuant to the provisions of such paragraph eight as it was in effect for agreements entered into prior to January first, nineteen hundred eighty-four; (8) for taxable years beginning after December thirty-first, nineteen hundred eighty-one, except with respect to property which is a qualified mass commuting vehicle described in subparagraph (D) of paragraph eight of subsection (f) of section one hundred sixty-eight of the internal revenue code (relating to qualified mass commuting vehicles), any amount which the taxpayer could have excluded from federal taxable income had it not made the election provided for in such paragraph eight as it was in effect for agreements entered into prior to January first, nineteen hundred eighty-four; (9) the amount deductible pursuant to paragraph (j) of this subdivision; and (10) upon the disposition of recovery property to which paragraph (j) of this subdivision applies, the amount, if any, by which the aggregate of the amounts described in subparagraph eleven of paragraph (b) of this subdivision attributable to such property exceeds the aggregate of the amounts described in paragraph (j) of this subdivision attributable to such property. (11) for taxable years ending after September 10, 2001, the amount deductible pursuant to paragraph (1) of this subdivision. (b) Entire net income shall be determined without the exclusion, deduction or credit of: (1) the amount of any specific exemption or credit allowed in any law of the United States imposing any tax on or measured by the income of corporations, (2) any part of any income from dividends or interest on any kind of stock, securities or indebtedness, except as provided in clauses one and two of paragraph (a) hereof, (3) taxes paid or accrued to the United States on or measured by profits or income or to the state under article nine or nine-a of the tax law, (4) taxes imposed under this part, (4-a) (A) the entire amount allowable as an exclusion or deduction for stock transfer taxes imposed by article twelve of the tax law in determining the entire taxable income which the taxpayer is required to report to the United States treasury department but only to the extent that such taxes are incurred and paid in market making transactions and (B) the amount allowed as an exclusion or deduction for sales and use taxes imposed by section eleven hundred seven of the tax law in determining the entire taxable income which the taxpayer is required to report to the United States treasury department but only such portion of such exclusion or deduction which is not in excess of the amount of the credit allowed pursuant to section four-b of this part. (4-b) the amount allowed as an exclusion or deduction imposed by the tax law in determining the entire taxable income which the taxpayer is required to report to the United States treasury department but only such portion of such exclusion or deduction which is not in excess of the amount of the credit or part thereof allowed pursuant to section four-c of this part with respect to a taxable year. (4-c) the amount allowed as an exclusion or deduction imposed by the tax law in determining the entire taxable income which the taxpayer is required to report to the United States treasury department but only such portion of such exclusion or deduction which is not in excess of the amount of the credit allowed pursuant to section four-d of this part.
(4-d) The amount allowed as an exclusion or deduction for sales and use taxes imposed by section eleven hundred seven of the tax law in determining the entire taxable income which the taxpayer is required to report to the United States Treasury Department but only such portion of such exclusion or deduction which is not in excess of the amount of the credit allowed pursuant to section four-e of this part. (4-e) the amount allowed as an exclusion or deduction for sales and use taxes imposed by section eleven hundred seven of the tax law in determining the entire taxable income which the taxpayer is required to report to the United States treasury department, but only such portion of such exclusion or deduction which is not in excess of the amount of the credit allowed pursuant to section four-f of this part. (5) ninety per centum of interest on indebtedness directly or indirectly owed to any stockholder or shareholder (including subsidiaries of a corporate stockholder or shareholder), or members of the immediate family of an individual stockholder or shareholder, owning in the aggregate in excess of five per centum of the issued capital stock of the taxpayer, except that such interest may, in any event, be deducted (A) up to an amount not exceeding one thousand dollars, (B) in full to the extent that it relates to bonds or other evidences of indebtedness issued, with stock, pursuant to a bona fide plan of reorganization, to persons, who, prior to such reorganization, were bona fide creditors of the corporation or its predecessors, but were not stockholders or shareholders thereof, (C) in full where the investment allocation percentage is applied to entire net income, and (D) in full to the extent that it is paid to a federally licensed small business investment company; (6) in the discretion of the director of finance, any amount of interest directly or indirectly and any other amount directly attributable as a carrying charge or otherwise to subsidiary capital or to income, gains or losses from subsidiary capital; and (7) any amount by reason of the granting, issuing or assuming of a restricted stock option, as defined in the internal revenue code of nineteen hundred fifty-four, or by reason of the transfer of the share of stock upon the exercise of the option, unless such share is disposed of by the grantee of the option within two years from the date of the granting of the option or within six months after the transfer of such share to him; (8) in the case of a taxpayer who is separately or as a partner of a partnership doing an insurance business as a member of the New York insurance exchange described in paragraph (a) of subdivision one of section four hundred twenty-five-a of the insurance law, such taxpayer's distributive or pro rata share of the allocated entire net income of such business as determined under sections fifteen hundred three and fifteen hundred four of the tax law, provided however, in the event such allocated entire net income is a loss, such taxpayer's distributive or pro rata share of such loss shall not be subtracted from federal taxable income in computing entire net income under this subdivision. (9) for taxable years beginning after December thirty-first, nineteen hundred eighty-one, except with respect to property which is a qualified mass commuting vehicle described in subparagraph (D) of paragraph eight of subsection (f) of section one hundred sixty-eight of the internal revenue code (relating to qualified mass commuting vehicles), any amount which the taxpayer claimed as a deduction in computing its federal taxable income solely as a result of an election made pursuant to the
provisions of such paragraph eight as it was in effect for agreements entered into prior to January first, nineteen hundred eighty-four; (10) for taxable years beginning after December thirty-first, nineteen hundred eighty-one, except with respect to property which is a qualified mass commuting vehicle described in subparagraph (D) of paragraph eight of subsection (f) of section one hundred sixty-eight of the internal revenue code (relating to qualified mass commuting vehicles), any amount which the taxpayer would have been required to include in the computation of its federal taxable income had it not made the election permitted pursuant to such paragraph eight as it was in effect for agreements entered into prior to January first, nineteen hundred eighty-four; (11) for taxable years beginning after December thirty-first, nineteen hundred eighty-one, except with respect to recovery property subject to the provisions of section two hundred eighty-F of the internal revenue code and recovery property placed in service in this state in taxable years beginning after December thirty-first, nineteen hundred eighty-four the amount allowable as a deduction under section one hundred sixty-eight of the internal revenue code; (12) upon the disposition of recovery property to which paragraph (j) of this subdivision applies, the amount, if any, by which the aggregate of the amounts described in such paragraph (j) attributable to such property exceeds the aggregate of the amounts described in subparagraph eleven of this paragraph attributable to such property. (13) for taxable years ending after September 10, 2001, in the case of qualified property described in paragraph 2 of subsection k of section 168 of the internal revenue code, other than qualified resurgence zone property described in paragraph (n) of this subdivision, and other than qualified New York Liberty Zone property described in paragraph 2 of subsection b of section 1400L of the internal revenue code (without regard to clause (i) of subparagraph (C) of such paragraph), the amount allowable as a deduction under section 167 of the internal revenue code. (c) Entire net income shall include income within and without the United States; (d) The director of finance may, whenever necessary in order properly to reflect the entire net income of any taxpayer, determine the year or period in which any item of income or deduction shall be included, without regard to the method of accounting employed by the taxpayer; (e) The entire net income of any bridge commission created by act of congress to construct a bridge across an international boundary means its gross income less the expense of maintaining and operating its properties, the annual interest upon its bonds and other obligations, and the annual charge for the retirement of such bonds or obligations at maturity; (f) A net operating loss deduction shall be allowed which shall be the same as the net operating loss deduction allowed under section one hundred seventy-two of the internal revenue code or which would have been allowed if the taxpayer had not made an election under subchapter s of chapter one of the internal revenue code, except that (1) any net operating loss included in determining such deduction shall be adjusted to reflect the inclusions and exclusions from entire net income pursuant to paragraphs (a), (b), (g) and (h) hereof, (2) such deductions shall not include any net operating loss sustained during any taxable year in which the taxpayer was not subject to the tax imposed by this part, (3) such deduction shall not exceed the deduction for the taxable year allowable under section one hundred seventy-two of the internal revenue code, or the deduction for the taxable year which would have been allowable if the taxpayer had not made an election under subchapter s of
chapter one of the internal revenue code, and (4) any net operating loss for a taxable year beginning in nineteen hundred eighty-one shall be computed without regard to the deduction allowed with respect to recovery property under section one hundred sixty-eight of the internal revenue code; in lieu of such deduction, a taxpayer shall be allowed for such taxable year with respect to such property the depreciation deduction allowable under section one hundred sixty-seven of such code as such section was in full force and effect on December thirty-first, nineteen hundred eighty; (g) At the election of the taxpayer, a deduction shall be allowed for expenditures paid or incurred during the taxable year for the construction, reconstruction, erection or improvement of industrial waste treatment facilities and air pollution control facilities. (1) (A) The term "industrial waste treatment facilities" shall mean facilities for the treatment, neutralization or stabilization of industrial waste (as the term "industrial waste" is defined in section twelve hundred two of the public health law) from a point immediately preceding the point of such treatment, neutralization or stabilization to the point of disposal, including the necessary pumping and transmitting facilities, but excluding such facilities installed for the primary purpose of salvaging materials which are usable in the manufacturing process or are marketable. (B) The term "air pollution control facilities" shall mean facilities which remove, reduce, or render less noxious air contaminants emitted from an air contamination source (as the terms "air contaminant" and "air contamination source" are defined in section twelve hundred sixty-seven of the state public health law) from a point immediately preceding the point of such removal, reduction or rendering to the point of discharge of air, meeting emission standards as established by the air pollution control board, but excluding such facilities installed for the primary purpose of salvaging materials which are usable in the manufacturing process or are marketable and excluding those facilities which rely for their efficacy on dilution, dispersion or assimilation of air contaminants in the ambient air after emission. (2) However, such deduction shall be allowed only (A) with respect to tangible property which is depreciable, pursuant to section one hundred sixty-seven of the internal revenue code, having a situs in the city and used in the taxpayer's trade or business, the construction, reconstruction, erection or improvement of which, in the case of industrial waste treatment facilities, is initiated on or after January first, nineteen hundred sixty-six, and only for expenditures paid or incurred prior to January first, nineteen hundred seventy-two, or which, in the case of air pollution control facilities, is initiated on or after January first, nineteen hundred sixty-six, and (B) on condition that such facilities have been certified by the state commissioner of health or his designated representative, pursuant to the public health law, as complying with applicable provisions of the public health law, the state sanitary code and regulations, permits or orders issued pursuant thereto, and (C) on condition that entire net income for the taxable year and all succeeding taxable years be computed without any deductions for such expenditures or for depreciation of the same property other than the deductions allowed by this paragraph (g) except to the extent that the basis of the property may be attributable to factors other than such expenditures, or in case a deduction is allowable pursuant to this paragraph for only a part of such expenditures, on condition that any deduction allowed for federal income tax purposes for such expenditures or for depreciation of the same property be proportionately reduced in
computing entire net income for the taxable year and all succeeding taxable years, and (D) where the election provided for in paragraph (d) of subdivision three of section four of this part has not been exercised in respect to the same property. (3) (A) If expenditures in respect to an industrial waste treatment facility or an air pollution control facility have been deducted as provided herein and if within ten years from the end of the taxable year in which such deduction was allowed such property or any part thereof is used for the primary purpose of salvaging materials which are usable in the manufacturing process or are marketable, the taxpayer shall report such change of use in its report for the first taxable year during which it occurs, and the director of finance may recompute the tax for the year or years for which such deduction was allowed and any carryback or carryover year, and may assess any additional tax resulting from such recomputation within the time fixed by paragraph (h) of subdivision three of section seventy-four. (B) If a deduction is allowed as herein provided for expenditures paid or incurred during any taxable year on the basis of a temporary certificate of compliance issued pursuant to the public health law and if the taxpayer fails to obtain a permanent certificate of compliance upon completion of the facilities with respect to which such temporary certificate was issued, the taxpayer shall report such failure in its report for the taxable year during which such facilities are completed, and the director of finance may recompute the tax for the year or years for which such deduction was allowed and any carryback or carryover year, and may assess any additional tax resulting from such recomputation within the time fixed by paragraph (h) of subdivision three of section seventy-four. (4) In any taxable year when property is sold or otherwise disposed of, with respect to which a deduction has been allowed pursuant to this paragraph, such deduction shall be disregarded in computing gain or loss, and the gain or loss on the sale or other disposition of such property shall be the gain or loss entering into the computation of entire taxable income which the taxpayer is required to report to the United States treasury department for such taxable year; (h) With respect to gain derived from the sale or other disposition of any property acquired prior to January first, nineteen hundred sixty-six, which had a federal adjusted basis on such date (or on the date of its sale or other disposition prior to January first, nineteen hundred sixty-six) lower than its fair market value on January first, nineteen hundred sixty-six or the date of its sale or other disposition prior thereto, except property described in subsections one and four of section twelve hundred twenty-one of the internal revenue code, the difference between--- (a) the amount of the taxpayer's federal taxable income, and (b) the amount of the taxpayer's federal taxable income (if smaller than the amount described in (a)) computed as if the federal adjusted basis of each such property (on the sale or other disposition of which gain was derived) on the date of the sale or other disposition had been equal to either (i) its fair market value on January first, nineteen hundred sixty-six or the date of its sale or other disposition prior to January first, nineteen hundred sixty-six, plus or minus all adjustments to basis made with respect to such property for federal income tax purposes for periods on and after January first, nineteen hundred sixty-six or (ii) the amount realized from its sale or disposition, whichever is lower; provided, however, that the total modification provided by this paragraph (h) shall not exceed the amount of the
taxpayer's net gain from the sale or other disposition of all such property. (i) If the period covered by a report under this part is other than the period covered by the report to the United States treasury department, entire net income shall be determined by multiplying the federal taxable income (as adjusted pursuant to the provisions of this part) by the number of calendar months or major parts thereof covered by the report under this part and dividing by the number of calendar months or major parts thereof covered by the report to such department. If it shall appear that such method of determining entire net income does not properly reflect the taxpayer's income during the period covered by the report under this part, the director of finance shall be authorized in his discretion to determine such entire net income solely on the basis of the taxpayer's income during the period covered by its report under this part. (j) For taxable years beginning after December thirty-first, nineteen hundred eighty-one, except with respect to recovery property subject to the provisions of section two hundred eighty-F of the internal revenue code and recovery property placed in service in this state in taxable years beginning after December thirty-first, nineteen hundred eighty-four, and provided a deduction has not been excluded from entire net income pursuant to subparagraph nine of paragraph (b) of this subdivision, a taxpayer shall be allowed with respect to recovery property the depreciation deduction allowable under section one hundred sixty-seven of the internal revenue code as such section would have applied to property placed in service on December thirty-first, nineteen hundred eighty. (l) for taxable years ending after September 10, 2001, in the case of qualified property described in paragraph 2 of subsection k of section 168 of the internal revenue code, other than qualified resurgence zone property described in paragraph (n) of this subdivision, and other than qualified New York Liberty Zone property described in paragraph 2 of subsection b of section 1400L of the internal revenue code (without regard to clause (i) of subparagraph (C) of such paragraph), a taxpayer shall be allowed with respect to such property the depreciation deduction allowable under section 167 of the internal revenue code as such section would have applied to such property had it been acquired by the taxpayer on September 10, 2001. (m) for taxable years ending after September 10, 2001, upon the disposition of property to which paragraph (l) of this subdivision applies, the amount of any gain or loss includible in entire net income shall be adjusted to reflect the inclusions and exclusions from entire net income pursuant to subparagraph 11 of paragraph (a) and subparagraph 13 of paragraph (b) of this subdivision attributable to such property. (n) for purposes of paragraphs (l) and (m) of this subdivision, qualified resurgence zone property shall mean qualified property described in paragraph 2 of subsection k of section 168 of the internal revenue code substantially all of the use of which is in the resurgence zone, as defined below, and is in the active conduct of a trade or business by the taxpayer in such zone, and the original use of which in the resurgence zone commences with the taxpayer after September 10, 2001. The resurgence zone shall mean the area of New York county bounded on the south by a line running from the intersection of the Hudson River with the Holland Tunnel, and running thence east to Canal Street, then running along the centerline of Canal Street to the intersection of the Bowery and Canal Street, running thence in a southeasterly direction diagonally across Manhattan Bridge Plaza, to the Manhattan Bridge and thence along the centerline of the Manhattan Bridge to the point where
the centerline of the Manhattan Bridge would intersect with the easterly bank of the East River, and bounded on the north by a line running from the intersection of the Hudson River with the Holland Tunnel and running thence north along West Avenue to the intersection of Clarkson Street then running east along the centerline of Clarkson Street to the intersection of Washington Avenue, then running south along the centerline of Washington Avenue to the intersection of West Houston Street, then east along the centerline of West Houston Street, then at the intersection of the Avenue of the Americas continuing east along the centerline of East Houston Street to the easterly bank of the East River. 9. (a) The term "calendar year" means a period of twelve calendar months (or any shorter period beginning on the date the taxpayer becomes subject to the tax imposed by this part) ending on the thirty-first day of December, provided the taxpayer keeps its books on the basis of such period or on the basis of any period ending on any day other than the last day of a calendar month, or provided the taxpayer does not keep books, and includes, in case the taxpayer changes the period on the basis of which it keeps its books from a fiscal year to a calendar year, the period from the close of its last old fiscal year up to and including the following December thirty-first. (b) The term "fiscal year" means a period of twelve calendar months (or any shorter period beginning on the date the taxpayer becomes subject to the tax imposed by this part) ending on the last day of any month other than December, provided the taxpayer keeps its books on the basis of such period, and includes, in case the taxpayer changes the period on the basis of which it keeps its books from a calendar year to a fiscal year or from one fiscal year to another fiscal year, the period from the close of its last old calendar or fiscal year up to the date designated as the close of its new fiscal year. 10. The term "tangible personal property" means corporeal personal property, such as machinery, tools, implements, goods, wares and merchandise, and does not mean money, deposits in banks, shares of stock, bonds, notes, credits or evidences of an interest in property and evidences of debt. § 3. Imposition of tax; exemptions. 1. For the privilege of doing business in the city in a corporate or organized capacity for all or any part of each of its fiscal or calendar years, every domestic or foreign corporation, except corporations specified in subdivision four of this section, shall annually pay a tax, upon the basis of its entire net income, or upon such other basis as may be applicable as hereinafter provided, for such fiscal or calendar year or part thereof, on a report which shall be filed, except as hereinafter provided, on or before the fifteenth day of March next succeeding the close of each such year, or, in the case of a taxpayer which reports on the basis of a fiscal year, within two and one-half months after the close of such fiscal year, and shall be paid as hereinafter provided. 2. The holding of real property in the city shall be deemed to be doing business in the city within the meaning of this part. A corporation shall not be deemed to be doing business in the city, for the purposes of this part, by reason of (a) the maintenance of cash balances with banks or trust companies in the city, or (b) the ownership of shares of stock or securities kept in the city, if kept in a safe deposit box, safe, vault or other receptacle rented for the purpose, or if pledged as collateral security, or if deposited with one or more banks or trust companies, or brokers who are members of a recognized security exchange, in safekeeping or custody accounts, or (c) the taking of any action by any such bank or trust company or broker, which is
incidental to the rendering of safekeeping or custodian service to such corporation, or (d) any combination of the foregoing activities. 3. Any receiver, referee, trustee, assignee or other fiduciary, or any officer or agent appointed by any court, who conducts the business of any corporation, shall be subject to the tax imposed by this part in the same manner and to the same extent as if the business were conducted by the agents or officers of such corporation. A dissolved corporation which continues to conduct business shall also be subject to the tax imposed by this part. 4. Corporations subject to tax under part three, part four or part five, or under a local law of the city imposing a tax on utilities, and any trust company organized under a law of this state all of the stock of which is owned by not less than twenty savings banks organized under a law of this state, and housing companies organized and operating pursuant to the provisions of article two, article four or article five of the private housing finance law, shall not be subject to tax under this part; provided, however, that corporations, other than utility corporations subject to the supervision of the state department of public service, which are subject to tax under a local law of the city imposing a tax on vendors of utility services shall be subject to tax under this part on that percentage of their entire net income allocable to the city under section four which their receipts other than those taxable under such local law taxing vendors of utility services is of their total receipts. 5. The tax imposed by subdivision one of this section, with the modifications provided by subdivision six of this section, is imposed for each calendar or fiscal year beginning with calendar or fiscal years ending in or with the calendar year nineteen hundred sixty-six. 6. (a) The tax for any taxable year ending prior to December thirty-first, nineteen hundred sixty-six shall be an amount equal to the tax imposed by subdivision one of this section for such taxable year, multiplied by the number of months (or major portions thereof) in such taxable year which occur after December thirty-first, nineteen hundred sixty-five and divided by the number of months (or major portions thereof) in such taxable year. (b) In lieu of the method of computation of tax prescribed in paragraph (a) of this subdivision, if the taxpayer maintained adequate records for the portion of any taxable year ending prior to December thirty-first, nineteen hundred sixty-six, which portion falls within the calendar year nineteen hundred sixty-six, it may elect to compute the tax for such taxable year by determining entire net income on the basis of the entire taxable income which it would have reported for federal income tax purposes had it filed a federal income tax return for a taxable year beginning January first, nineteen hundred sixty-six and ending with the close of its actual taxable year and such taxable year beginning January first, nineteen hundred sixty-six, shall be deemed to be the period covered by its report, except that in computing such tax any portion of a capital loss which results from a capital loss carryover and any net operating loss deduction, as modified pursuant to paragraph (f) of subdivision eight of section two shall be reduced by the same part of such portion of such capital loss or of such net operating loss deduction (as the case may be) as the number of months ( or major portions thereof) in the taxable year occurring before January first, nineteen hundred sixty-six is of the number of months (or major portions thereof) in such taxable year. § 4. Computation of tax. * 1. The tax imposed by subdivision one of section three of this part shall be, in the case of each taxpayer: (a) a tax (1) for taxable years beginning on or after January first, nineteen
hundred seventy-eight but before January first, nineteen hundred eighty-seven, computed at the rate of nine per centum, and for taxable years beginning on or after January first, nineteen hundred eighty-seven, computed at the rate of eight and eighty-five one hundredths per centum on its entire net income, or the portion thereof allocated within the city as hereinafter provided, subject to any modification required by paragraph (d) of subdivision three of this section, or (2) computed at one and one-half mills for each dollar of its total business and investment capital, or the portion thereof allocated within the city as hereinafter provided, except that in the case of a cooperative housing corporation as defined in the internal revenue code, the applicable rate shall be four-tenths of one mill, or (3) for taxable years beginning on or after January first, nineteen hundred seventy-eight but before January first, nineteen hundred eighty-seven, computed at the rate of nine per centum, and for taxable years beginning on or after January first, nineteen hundred eighty-seven, computed at the rate of eight and eighty-five one hundredths per centum on thirty per centum of the taxpayer's entire net income plus salaries and other compensation paid to the taxpayer's elected or appointed officers and to every stockholder owning in excess of five per centum of its issued capital stock minus fifteen thousand dollars (except as hereinafter provided) and any net loss for the reported year, or on the portion of such sum allocated within the city as hereinafter provided for the allocation of entire net income, subject to any modification required by paragraph (d) of subdivision three of this section, or (4) one hundred twenty-five dollars, whichever is the greatest, plus (b) a tax computed at the rate of three-quarters of a mill for each dollar of the portion of its subsidiary capital allocated within the city as hereinafter provided. In the case of a taxpayer which is not subject to tax for an entire year, or which elects to compute its tax pursuant to paragraph (b) of subdivision six of section three, the exemption allowed in clause three of paragraph (a) shall be prorated according to the period such taxpayer was subject to tax or, in the case of such an election, the period for which its entire net income is determined pursuant to such paragraph (b) of subdivision six of section three. * NB Effective until December 31, 2011 * 1. The tax imposed by subdivision one of section three of this part shall be, in the case of each taxpayer: (a) a tax (1) computed at the rate of five and one-half per centum, or as an alternative for taxable years beginning on or after January first, nineteen hundred seventy-one, at the rate of six and seven-tenths per centum, on its entire net income, or the portion thereof allocated within the city as hereinafter provided, subject to any modification required by paragraph (d) of subdivision three of this section, or (2) computed at one mill for each dollar of its total business and investment capital, or the portion thereof allocated within the city as hereinafter provided, except that in the case of a cooperative housing corporation as defined in the internal revenue code, the applicable rate shall be one-quarter of one mill, or (3) computed at the rate of five and one-half per centum, or as an alternative for taxable years beginning on or after January first, nineteen hundred seventy-one, at the rate of six and seven-tenths per centum, on thirty per centum of the taxpayer's entire net income plus salaries and other compensation paid to the taxpayer's elected or appointed officers and to every stockholder owning in excess of five per centum of its issued capital stock minus fifteen thousand dollars (except as hereinafter provided) and any net loss for the reported year, or on the portion of such sum allocated within the city as hereinafter
provided for the allocation of entire net income, subject to any modification required by paragraph (d) of subdivision three of this section, or (4) twenty-five dollars, whichever is the greatest, plus (b) a tax computed at the rate of one-half mill for each dollar of the portion of its subsidiary capital allocated within the city as hereinafter provided. In the case of a taxpayer which is not subject to tax for an entire year, or which elects to compute its tax pursuant to paragraph (b) of subdivision six of section three, the exemption allowed in clause three of paragraph (a) shall be prorated according to the period such taxpayer was subject to tax or, in the case of such an election, the period for which its entire net income is determined pursuant to such paragraph (b) of subdivision six of section three. * NB Effective December 31, 2011 2. The amount of subsidiary capital, investment capital and business capital shall each be determined by taking the average fair market value of the gross assets included therein (less, in the case of business capital, average liabilities deductible therefrom which are payable by their terms on demand or within one year from the date incurred, other than loans or advances outstanding for more than a year as of any date during the year covered by the report), and, if the period covered by the report is other than a period of twelve calendar months, by multiplying such value by the number of calendar months or major parts thereof included in such period, and dividing the product thus obtained by twelve. 3. The portion of the entire net income of a taxpayer to be allocated within the city shall be determined as follows: (a) multiply its business income by a business allocation percentage to be determined by (1) ascertaining the percentage which the average value of the taxpayer's real and tangible personal property within the city during the period covered by its report bears to the average value of all the taxpayer's real and tangible personal property wherever situated during such period; (2) ascertaining the percentage which the receipts of the taxpayer, computed on the cash or accrual basis according to the method of accounting used in the computation of its entire net income, arising during such period from (A) sales of its tangible personal property located within the city at the time of the receipt of or appropriation to the orders, where shipments are made to points within the city, (B) sales of its tangible personal property not located at the time of the receipt of or appropriation to the orders at any permanent or continuous place of business maintained by the taxpayer without the city where the orders were received or accepted within the city and where shipments are made to points within the city, (C) sales of its tangible personal property located within the city at the time of the receipt of or appropriation to the orders where shipment is made to points outside of the city and sales of its tangible personal property (except sales described in clause (B)) located without the city at the time of the receipt of or appropriation to the orders where shipment is made to points within the city, but only to the extent of fifty per centum of the receipts from the sales referred to in this clause, (D) sales of its tangible personal property not located at the time of the receipt of or appropriation to the orders at any permanent or continuous place of business maintained by the taxpayer without the city, where the orders were received or accepted within the city and where shipment is made between points outside the city, but only to the
extent of fifty per centum of the receipts from the sales referred to in this clause. For purposes of this clause and clause (B) an order shall be deemed received or accepted within the city if it has been received or accepted by an employee, agent, agency or independent contractor chiefly situated at, connected with, by contract or otherwise, or sent out from a permanent or continuous place of business of the taxpayer within the city, (E) services performed within the city, (F) rentals from property situated and royalties from the use of patents or copyrights, within the city, and (G) all other business receipts earned within the city, bear to the total amount of the taxpayer's receipts, similarly computed, arising during such period from all sales of its tangible personal property, services, rentals, royalties and all other business transactions, whether within or without the city; (3) ascertaining the percentage of the total wages, salaries and other personal service compensation, similarly computed, during such period of employees within the city, except general executive officers, to the total wages, salaries and other personal service compensation, similarly computed, during such period of all the taxpayer's employees within and without the city, except general executive officers, and (4) adding together the percentages so determined and dividing the result by the number of percentages; provided, however, that if the taxpayer does not have a regular place of business outside the city other than a statutory office, the business allocation percentage shall be one hundred per centum; and (b) multiply its investment income by an investment allocation percentage to be determined by (1) multiplying the amount of its investment capital invested in each stock, bond or other security (other than governmental securities) during the period covered by its report by the percentage, if any, of the entire capital or the issued capital stock, or the gross direct premiums, or the net income, as the case may be, of the issuer or obligor thereof required to be allocated within the city on the report or reports, if any, required of any such issuer or obligor under part II, part III, part IV, or part V or under a local law of the city imposing a tax on utilities for the preceding year, provided, however, that for taxable years ending in or with calendar year nineteen hundred sixty-six, such percentage shall be presumed to be that percentage, if any, of the entire capital or the issued capital stock, or the gross direct premiums, or the net income, as the case may be, of the issuer or obligor thereof required to be allocated within the state on the report or reports, if any, required of any such issuer or obligor under the tax law or the insurance law for the preceding year, unless the taxpayer establishes the actual percentage which such issuer or obligor would have been required to allocate within the city had part II, part III, part IV, or part V been in effect for such year, or which such issuer or obligor did allocate within the city under a local law of the city imposing a tax on utilities, but without regard to any minimum, (2) adding together the sum so obtained, and (3) dividing the result so obtained by the total of its investment capital invested during such period in stocks, bonds and other securities (other than obligations of the United States and its instrumentalities and obligations of the state of New York, its political subdivisions and its instrumentalities); provided, however, that in case any investment capital is invested in any stock, bond or other security during only a portion of the period covered by the report, only such portion of such capital shall be taken into account;
and provided further, that if a taxpayer's investment allocation percentage is zero, interest received on bank accounts, on obligations of the United States and its instrumentalities and on obligations of the state of New York, its political subdivisions and its instrumentalities shall be multiplied by its business allocation percentage; and (c) add the products so obtained. (d) At the election of the taxpayer there shall be deducted from the portion of its entire net income allocated within the city either or both of the items set forth in subparagraphs one and two of this paragraph, except that only one of such deductions shall be allowed with respect to any one items of property. (1) Depreciation with respect to any property such as described in subparagraph three of this paragraph, not exceeding twice the depreciation allowed with respect to the same property for federal income tax purposes. Such deduction shall be allowed only upon condition that entire net income be computed without any deduction for the depreciation of the same property, and the total of all deductions allowed pursuant to the preceding sentence in any taxable year or years with respect to any property shall not exceed its cost or other basis. (2) Expenditures paid or incurred during the taxable year for the construction, reconstruction, erection or acquisition of any property such as described in subparagraph three of this paragraph which is used or to be used for purposes of research and development in the experimental or laboratory sense. Such purposes shall not be deemed to include the ordinary testing or inspection of materials or products for quality control, efficiency surveys, management studies, consumer surveys, advertising, promotions or research in connection with literary, historical or similar projects. Such deduction shall be allowed only on condition that entire net income for the taxable year and all succeeding taxable years be computed without the deduction of any such expenditures and without any deduction for depreciation of the same property, except to the extent that its basis may be attributable to factors other than such expenditures, or in case a deduction is allowable pursuant to this subparagraph for only a part of such expenditures, on condition that any deduction allowed for federal income tax purposes on account of such expenditures or on account of depreciation of the same property be proportionately reduced in computing entire net income for the taxable year and all succeeding taxable years. With respect to property which is used or to be used for research and development only in part, or during only part of its useful life, a proportionate part of such expenditures shall be deductible. If all or part of such expenditures with respect to any property shall have been deducted as provided herein, and such property is used for purposes other than research and deve