Instructions For Form Nyc-204 -Partnership Return

Instructions for Form NYC-204 - 2010

Page 3

ued according to the books and records of

Example 3:

the licensed capacity of the facility

the taxpayer in accordance with generally

The facts are the same as in example 2 ex-

if licensed;

accepted accounting principles (GAAP).

cept that C’s interest in Partnership D rep-

the total number of transactions and

resents 95 percent of C’s gross assets. C

amount of receipts for the taxable

Investor Defined: For this purpose, a tax-

qualifies as primarily engaged in the ac-

year from all sales of parking serv-

payer will be considered to hold an interest

tivities described at (1) and (2). There-

ices including prepaid parking serv-

in another entity as an investor if either:

fore C is not taxable on its share of D’s

ices, all parking services provided

(i)

the entity would qualify as primarily

self-trading income. A is taxable on its

without charge and all parking serv-

engaged in the activities described at

share of C’s income other than C’s share

ices paid for by a person other than

(1) and (2) above and the taxpayer’s

of D’s self-trading income.

the person whose vehicle is parked,

share of each item of the entity’s in-

garaged or stored, such as a mer-

A partnership that is an owner, lessee or fi-

come, gain, deduction, credit or loss

chant validation of a parking ticket);

duciary will not be deemed engaged in an

is not materially different from the

unincorporated business solely by reason of

taxpayer’s share of any other such

the total number of transactions and

the holding, leasing or managing of real

item, or

amount of receipts from sales of

property. For taxable years beginning on or

monthly or longer term parking serv-

(ii) the taxpayer is neither a general part-

after July 1, 1994, if an individual or unin-

ices including a designation of each

ner nor managing or participating in

corporated entity is carrying on an unincor-

transaction and receipt as exempt

the day-to-day business of the other

porated business in whole or in part in the

from the 8 percent Manhattan park-

entity. See Admin. Code §11-502 (c)

City, and is also holding, leasing or manag-

ing tax, where applicable; and

(1) (B).

ing real property as an owner, lessee or fi-

the total number of transactions and

duciary, the holding, leasing or managing of

Use the worksheet provided at the end of

amount of receipts from sales of

the property will not be considered an unin-

these instructions to determine whether

monthly or longer term parking serv-

corporated business to the extent that the

you are eligible for the partial exemption.

ices provided to building tenants.

real property is held for the purposes of pro-

The partial exemption is illustrated by the

ducing rental income or gain on the dispo-

Failure to submit the above informa-

following examples:

sition of the real property, provided,

tion with this return will result in all of

however, this partial exemption for rental

Example 1:

the income of that garage being subject

real estate is not available to a dealer

In 1996, Partnership A is engaged directly

to tax.

See Section 11-502 (d) of the

holding real property primarily for sale

in the purchase and sale of stocks and se-

NYC Administrative Code.

to customers in the ordinary course of the

curities for its own account in the City.

dealer’s trade or business. The operation

NOTE: If you engage exclusively in an ex-

Partnership A also is a limited partner in

by any taxpayer, otherwise eligible for the

empt unincorporated business activity but

Partnership B, which is engaged in the

partial exemption, of a garage or other busi-

file for information purposes, use Form

purchase and sale of securities for its own

ness at the property solely for the benefit of

NYC-204EZ.

account in the City. Partnership A also is

tenants in the property that is not open or

a non-managing member of Limited Lia-

available to the general public will be con-

OTHER FORMS YOU MAY BE

bility Company C, which is a securities

sidered to be incidental to the holding, leas-

REQUIRED TO FILE

dealer in the City. LLC C is subject to tax

ing or managing of the property and will not

FORM NYC-5UB - Partnership Declaration of

on all of its income. Partnership B is

be considered an unincorporated business.

Estimated Unincorporated Business Tax must

wholly exempt from tax.

However, if such a taxpayer operates a

be filed by every partnership carrying on an

Partnership A is not eligible for the full

garage or other business at the property that

unincorporated business or profession in New

investment exemption. However, Part-

also is open or available to the general pub-

York City and whose estimated tax can rea-

nership A qualifies as primarily engaged

lic, that garage or other business will be

sonably be expected to exceed $3,400 for the

in activities described at (1) and (2).

considered a taxable unincorporated busi-

tax year immediately following the tax year

Therefore, A is not taxable on its own

ness, provided, however, for taxable years

covered by this return.

self-trading activity nor on its share of B’s

beginning after 1995, if a taxpayer operates

The declaration must cover a full calendar or

income from self-trading. A is taxable on

a garage that is open to building tenants and

fiscal year and is due on the 15th day of the

its share of C’s income, gains and losses,

the public, the operation of that garage will

fourth month of the taxable year.

including any income, gains and losses

not be considered a taxable unincorporated

from C’s own self-trading activity. Part-

business but only to the extent of income

For further information about estimated

nership A is not treated as a dealer solely by

from parking services provided at that

tax payments and due dates see Form

reason of its membership in LLC C.

garage to building tenants on a monthly or

NYC-5UB.

longer-term basis and only if the informa-

Example 2:

tion required to be filed with this return

FORM NYC-EXT - Application for Automatic

The facts are the same in example 1 ex-

6-month Extension of Time to File Business

specified below is provided with respect

cept that C is also a limited partner in

Income Tax Return. File Form NYC-EXT on

to that garage. All other income from the

Partnership D, which is engaged solely in

operation of that garage will be subject to

or before the due date of the return.

the purchase and sale of securities for its

the tax.

own account in the City. LLC C’s interest

FORM NYC-115 - Unincorporated Business

in Partnership D represents less than 90

The taxpayer must submit with this return

Tax Report of Change in Taxable Income made

percent of C’s gross assets. Partnership

by the Internal Revenue Service and/or New

a statement containing the following for

D is exempt from tax because it is solely

each garage or other similar facility that is

York State Department of Taxation and Fi-

trading for its own account. C is taxable

nance must be used for reporting adjustments

operated for the benefit of building tenants

on its share of D’s self-trading income be-

in taxable income resulting from an Internal

and that is open to the general public:

cause C does not qualify as primarily en-

Revenue Service audit of your federal income

the parking facility name;

gaged in the activities described at (1) and

tax return and/or a New York State Department

(2). A is taxable on its share of C’s in-

the parking facility address;

of Taxation and Finance audit of your State in-

come including C’s share of D’s self-trad-

come tax return.

the license number of the facility if

ing income.

applicable;

Instructions For Form Nyc-204 -Partnership Return - 2010 Page 4

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