2023 New York Laws › TAX - Tax › Article 9 - Corporation Tax › 184 - Additional Franchise Tax on Transportation and Transmission Corporations and Associations.

§  184.  Additional  franchise  tax on transportation and transmission
corporations and associations.-- 1. The term "corporation"  as  used  in
this  section  shall  include  an  association,  within  the  meaning of
paragraph three of subsection (a) of section seventy-seven  hundred  one
of  the internal revenue code (including a limited liability company), a
publicly traded partnership treated as a corporation for purposes of the
internal revenue code pursuant to  section  seventy-seven  hundred  four
thereof.
Every  corporation,  joint-stock  company or association formed for or
principally engaged in the conduct of canal, steamboat, ferry (except  a
ferry  company  operating between any of the boroughs of the city of New
York under a lease granted by the city), express, navigation, pipe line,
transfer,  baggage  express,  omnibus,  taxicab,  telegraph   or   local
telephone  business, or formed for or principally engaged in the conduct
of two or more of such businesses, and  every  corporation,  joint-stock
company  or association formed for or principally engaged in the conduct
of surface railroad, whether or not operated by steam, subway  railroad,
elevated  railroad,  palace  car,  sleeping  car or trucking business or
formed for or principally engaged in the conduct of  two  or  more  such
businesses and which has made an election pursuant to subdivision ten of
section  one  hundred  eighty-three  of  this  article,  and every other
corporation,  joint-stock  company  or   association   formed   for   or
principally  engaged  in the conduct of a transportation or transmission
business (other  than  a  telephone  business),  except  a  corporation,
joint-stock  company or association formed for or principally engaged in
the conduct of a surface railroad, whether or  not  operated  by  steam,
subway railroad, elevated railroad, palace car, sleeping car or trucking
business  or  formed for or principally engaged in the conduct of two or
more of such businesses and which has not made the election provided for
in subdivision ten of section one hundred eighty-three of this  article,
and,   except   a   corporation,   joint-stock  company  or  association
principally engaged in the conduct of aviation  (including  air  freight
forwarders  acting  as  principal  and  like  indirect air carriers) and
except a corporation principally engaged in providing  telecommunication
services  between  aircraft  and  dispatcher,  aircraft  and air traffic
control or ground station and ground station (or any combination of  the
foregoing),  at  least  ninety  percent  of  the  voting  stock of which
corporation is owned, directly or indirectly, by air carriers and  which
corporation's  principal  function is to fulfill the requirements of (i)
the federal aviation administration (or the successor thereto)  or  (ii)
the   international   civil  aviation  organization  (or  the  successor
thereto), relating to the existence of a  communication  system  between
aircraft  and  dispatcher,  aircraft  and  air traffic control or ground
station and ground station (or any combination of the foregoing) for the
purposes  of  air  safety  and  navigation  and  for  the  privilege  of
exercising  its  corporate  franchise,  or  of  doing  business,  or  of
employing capital, or of owning or leasing property in this state  in  a
corporate or organized capacity, or maintaining an office in this state,
shall  pay  a franchise tax which shall be equal to three-eighths of one
percent for taxable years commencing after two thousand, upon its  gross
earnings  from  all  sources within this state; except that, for taxable
years commencing on or after January  first,  nineteen  hundred  ninety,
every  corporation,  joint-stock  company  or  association formed for or
principally engaged in the  conduct  of  local  telephone  business,  or
telegraph  business  shall  pay  a franchise tax which shall be equal to
three-eighths of one percent for  taxable  years  commencing  after  two
thousand,  upon  its  gross earnings from all sources within this state,
except that a corporation, joint-stock company or association formed for

or principally engaged in the conduct  of  a  local  telephone  business
shall  exclude  the  following  earnings  (but not in any event earnings
derived by such taxpayer from the provision of carrier access  services)
derived  by  such  taxpayer  from  sales  for  ultimate  consumption  of
telecommunications service  to  its  customers  (i)  thirty  percent  of
separately  charged  intra-LATA  toll  service (which shall also include
interregion regional calling plan service) and (ii) one hundred  percent
of   separately   charged   inter-LATA,   interstate   or  international
telecommunications service; and except  that  corporations,  joint-stock
companies  or  associations  formed  for  or  principally engaged in the
conduct of canal, steamboat, ferry (except  a  ferry  company  operating
between  any  of  the  boroughs  of  the  city of New York under a lease
granted by the city),  navigation  or  any  corporation  formed  for  or
principally  engaged  in the operation of vessels, shall pay a franchise
tax which shall be equal to three-quarters of one per  centum  upon  its
gross  earnings  from  all sources within this state, excluding earnings
derived from business of an interstate or foreign character; except that
for  taxable  years  beginning  in  nineteen  hundred  ninety-seven   or
thereafter,  in  the  case  of  a  corporation,  joint-stock  company or
association  which,  with  respect  to  taxable  years  beginning  after
nineteen   hundred  ninety-seven,  has  made  an  election  pursuant  to
subdivision ten of section one hundred eighty-three of this article  and
which  is  formed  for  or principally engaged in the conduct of surface
railroad, whether or not operated by steam,  subway  railroad,  elevated
railroad, palace car, sleeping car or trucking business or formed for or
principally  engaged  in  the conduct of two or more of such businesses,
such  corporation,  joint-stock  company  or  association  shall  pay  a
franchise  tax  which shall be equal to three-eighths of one percent for
taxable years commencing after two thousand,  upon  its  gross  earnings
from  all  sources  within  this  state,  provided that in the case of a
corporation,  joint-stock  company  or   association   formed   for   or
principally  engaged  in the conduct of surface railroad, whether or not
operated by steam, subway railroad, elevated  railroad,  palace  car  or
sleeping  car  business,  or  formed  for  or principally engaged in the
conduct of two or more of such businesses, such gross earnings shall not
include earnings derived from  business  of  an  interstate  or  foreign
character.
Provided, however, with respect to railroad, elevated railroad, palace
car  or  sleeping  car  business  or any other corporation formed for or
principally engaged in the conduct of a  railroad  business  and  canal,
steamboat,  ferry  (except  a ferry company operating between any of the
boroughs of the city of New York under a lease  granted  by  the  city),
navigation  or  any corporation formed for or principally engaged in the
operation of vessels where the gross earnings from  such  transportation
business   both  originating  and  terminating  within  this  state  and
traversing both this state and another state or states or country  shall
be  subject  to  the franchise tax imposed by this section (except where
such corporation, joint-stock company or association is  formed  for  or
principally  engaged  in  the  conduct  of a railroad (including surface
railroad, whether or not operated by steam, subway railroad or  elevated
railroad),  palace  car  or  sleeping  car  business  or  formed  for or
principally engaged in the conduct of two or more  of  such  businesses,
and  has  not  made  the  election provided for under subdivision ten of
section one hundred eighty-three of  this  article)  and  such  earnings
shall  be  allocated  to  this  state in the same ratio that the mileage
within the state bears to the total mileage of such business.  Provided,
further, a corporation, joint-stock company or association formed for or
principally  engaged in the transportation, transmission or distribution

of gas, electricity or steam shall not be  subject  to  tax  under  this
section or section one hundred eighty-three of this article.
The  term "local telephone business" means the provision or furnishing
of telecommunication services for hire wherein the service furnished  by
the  provider  thereof consists of carrier access service or the service
originates and terminates within the same  local  access  and  transport
area  ("LATA"),  a local access and transport area being that geographic
area as established and approved, and as so set and in existence on July
first, nineteen hundred ninety-four, pursuant  to  the  modification  of
final  judgment  in  United  States  v.  Western Electric Company (civil
action no. 82-0192) in the United States district court for the District
of Columbia or within the LATA-like Rochester non-associated independent
area.
The term "telecommunication services" shall have the meaning  ascribed
to such term in section one hundred eighty-six-e of this article.
1-a.  Where a taxpayer is a partner, member or associate of a publicly
traded partnership or an association which is subject to the tax imposed
under this section, the amount to be included in such  taxpayer's  gross
earnings  with  respect  to such partnership or association shall be the
amount received with respect to such partnership or association which is
required to be reported as  dividends  to  the  United  States  treasury
department.
2.  (a)  During  the period that the state tax on motor fuel, computed
without regard to any reimbursement allowable  under  paragraph  (d)  of
subdivision  three of section two hundred eighty-nine-c of this chapter,
exceeds  two  cents  per  gallon  the  corporations  herein  classed  as
"taxicab"  and "omnibus", other than corporations described in paragraph
(b) of this subdivision, shall be taxed under the provisions of  article
nine-a  of  the tax law and as other business corporations are taxed and
not upon their gross receipts.
(b) (1) A corporation classed as a "taxicab" or "omnibus",
(i) which is organized, incorporated or formed under the laws  of  any
other state, country or sovereignty, and
(ii)  which  neither  owns  nor  leases  property  in  this state in a
corporate or organized capacity, nor
(iii) maintains an office in this state in a  corporate  or  organized
capacity, but
(iv)  which  is  doing  business or employing capital in this state by
conducting at least one but fewer than  twelve  trips  into  this  state
during  the  calendar  year,  shall not be taxed under the provisions of
this article. If the only property a corporation owns or leases in  this
state  is  a  vehicle or vehicles used to conduct trips, it shall not be
considered, for purposes of clause (ii)  of  this  subparagraph,  to  be
owning or leasing property in this state.
(2)  For  purposes  of  this  subdivision,  a corporation classed as a
"taxicab" or "omnibus" shall be considered to be conducting a trip  into
New  York  state  when  one  of  its  vehicles enters New York state and
transports passengers to, from, or to and from a location  in  New  York
state.  A  corporation  shall  not be considered to be conducting a trip
into New York state if  its  vehicle  only  makes  incidental  stops  at
locations in the state while in transit from a location outside New York
state  to another location outside New York state. The number of trips a
corporation  conducts  into  New  York  state  shall  be  calculated  by
determining  the  number of trips each vehicle owned, leased or operated
by the corporation conducts into New York state and adding those numbers
together.
3. Any corporation, joint-stock company or association formed  for  or
principally   engaged  in  the  conduct  of  subway  railroad,  elevated

railroad, or surface railroad not operated  by  steam,  business,  whose
property  is  leased  to  another  railroad  corporation,  shall only be
required under this section to pay an annual tax at the rate of four and
one-half  per  centum  upon the dividends paid during the year ending on
the thirty-first day of December in excess of four per centum  upon  the
amount of its capital stock, provided, however, that for the year ending
on  the  thirty-first  day  of December nineteen hundred seventy-six, as
described in subdivision two of section one hundred ninety-two  of  this
chapter,  the tax shall be paid upon dividends paid during the months of
July through December of such year in excess of two per centum upon  the
amount  of  its  capital stock, except that where the property leased is
operated by a receiver and the gross earnings are not included with  the
gross  earnings  of  the  lessee for the purposes of taxation under this
section, then such receiver shall be required to pay the tax upon  gross
earnings as hereinbefore provided.
4.  Allocation  of gross earnings from transportation and transmission
services.--(a) General. A  transportation  or  transmission  corporation
shall  determine its gross earnings from transportation and transmission
services within this state (except as otherwise  provided  for  in  this
subdivision)  by  multiplying its gross earnings from transportation and
transmission within and without the state by a fraction,  the  numerator
of which is the taxpayer's mileage within this state and the denominator
of  which is the taxpayer's mileage within and without this state during
the period covered by the report or reports required by this chapter.
(b) Corporations engaged in the operation of  vessels.  A  corporation
principally  engaged  in  the  operation  of vessels shall determine its
gross earnings from transportation services within this state during the
period covered by the report or reports  required  by  this  chapter  by
multiplying  its  gross earnings from transportation services within and
without this state by a percentage which represents  the  ratio  of  the
aggregate number of working days of the vessels it owns or leases in all
navigable lakes, rivers, streams and waters within this state and in New
York  territorial  waters to the aggregate number of working days of all
the vessels it owns or leases during such period.
(c) Telephone and telegraph corporations.  A  telephone  or  telegraph
corporation   shall  determine  its  gross  earnings  from  transmission
services within this state during the period covered by  the  report  or
reports required by this chapter by totaling its gross operating revenue
from  transmission  services performed wholly within this state plus the
portion of revenue from  interstate  and  foreign  transmission  service
attributable to this state during such report period.
(d) All other gross earnings, if any, shall be allocated to this state
in the manner prescribed by rules and regulations promulgated by the tax
commission.
(e)  With  respect  to  other types of transportation and transmission
corporations or where the tax commission decides that with respect to  a
certain  corporation  the  method  prescribed  above does not fairly and
equitably reflect gross earnings from all sources within this state, the
tax commission shall prescribe methods of  allocation  or  apportionment
which  fairly  and  equitably  reflect  gross  earnings from all sources
within this state. Also, the tax commission may, in  order  to  properly
reflect gross earnings, determine the report period in which any item of
gross  earnings  shall  be  included  without  regard  to  the method of
accounting employed by a corporation taxable hereunder.
7-a. A railroad, palace car or sleeping car  corporation,  navigation,
canal,  ferry  (except  a  ferry  company  operating  between any of the
boroughs of the city of New York under a lease  granted  by  the  city),
steamboat, or any other corporation formed for or principally engaged in

the  operation  of  vessels whose only activity in this state is (i) the
maintenance of an office in this state and for the employing of  capital
in  this state and (ii) the use of property exclusively in interstate or
foreign  commerce,  shall  not  be  subject  to  the tax imposed by this
section.