New York Codes, Rules and Regulations › Title 20 - DEPARTMENT OF TAXATION AND FINANCE › Chapter II - Income Taxes and Estate Taxes › Subchapter D - City Of Yonkers Earnings Tax On Nonresidents › Part 262 - Allocation Of Wages And Net Earnings From Self-employment To The City Of Yonkers › Section 262.2 - Allocation of net earnings from self-employment to the City of Yonkers

Current through Register Vol. 46, No. 28, July 10, 2024
Tax Law, § 4 of § 1340(c); Codes and Ordinances of the City
					 of Yonkers, § 92-101
(a)
General.
If a nonresident taxpayer derives net earnings from
					 self-employment from services performed, or from sources both within and
					 without the City of Yonkers, such earnings must be apportioned and allocated to
					 the City of Yonkers on a fair and equitable basis in accordance with approved
					 methods of accounting.
(b)
Method of allocation.
(1) Place
				  of business.
If a nonresident taxpayer has no regular place of business
					 outside the City of Yonkers, all of such nonresident taxpayer's net earnings
					 from self-employment must be allocated to the City of Yonkers.
(2) Allocation by taxpayer's books.
If the books of the business are so kept as regularly to
					 disclose, to the satisfaction of the State Tax Commission, the proportion of
					 the net earnings derived from or connected with the City of Yonkers sources,
					 the portion of the net earnings from self-employment allocable to the City of
					 Yonkers may be determined from such books. The City of Yonkers earnings tax
					 return for the nonresident taxpayer must disclose the total amount of net
					 earnings from self-employment, the net earnings allocated to the City of
					 Yonkers and the basis upon which such allocation is made.
(3) Allocation by formula.
If the books and records of the business do not disclose to
					 the satisfaction of the State Tax Commission the proportion of the net earnings
					 from self-employment attributable to the activities of the business carried on
					 in the City of Yonkers, such proportion must be determined by multiplying the
					 net earnings of the business by the average of the following three
					 percentages:
(i) Property percentage.
(a) General. The percentage computed by
				  dividing (
1
) the average of the values, at the beginning and
				  end of the taxable year, of real and tangible personal property owned or rented
				  to the taxpayer, which is connected with net earnings from self-employment and
				  located within the City of Yonkers, by (
2
) the average of the
				  values, at the beginning and end of the taxable year, of all real and tangible
				  personal property owned by or rented to the taxpayer, which is connected with
				  the net earnings from self-employment and located both within and without the
				  City of Yonkers. For this purpose,
real property
includes real
				  property whether owned or rented to the taxpayer (also see section
				  262.3 
				  of this Part). For this purpose,
real and tangible personal
				  property
includes real and tangible personal property whether owned or
				  rented to the taxpayer (also see section
				  262.3 
				  of this Part).
(b) Rented real and
				  tangible personal property.
(1) The fair
				  market value of real and tangible personal property, both within and without
				  the City of Yonkers, which is rented to the taxpayer, is determined by
				  multiplying the gross rents payable during the taxable year by eight.
(2)
Gross rents,
as used in
				  this clause, is the actual sum of money or other consideration payable directly
				  or indirectly by the taxpayer or for the taxpayer's benefit for the use or
				  possession of the property, and includes:
(i)
				  any amount payable for the use or possession of real or tangible personal
				  property, or any part thereof, whether designated as a fixed sum of money or as
				  a percentage of sales, profit or otherwise;
(ii) any amount payable as additional rent or
				  in lieu of rent, such as interest, taxes, insurance, repairs or any other
				  amount required to be paid by the terms of a lease or other
				  arrangement;
(iii) a proportionate
				  part of the cost of any improvement to real or tangible personal property made
				  by or on behalf of the taxpayer which reverts to the owner or lessor upon
				  termination of a lease or other arrangement, based on the unexpired term of the
				  lease commencing with the date the improvement is completed (or the life of the
				  improvement if its life expectancy is less than the unexpired term of the
				  lease); provided, however, that where a building is erected on leased land by
				  or on behalf of the taxpayer, the value of the land is determined by
				  multiplying the gross rent by eight, and the value of the building is
				  determined in the same manner as if owned by the taxpayer.
(3) Gross rents do not include:
(i) any portion of a payment or credit to the
				  proprietor of the business, or to a partner in the partnership conducting the
				  business, for the use of real or tangible personal property;
(ii) amounts payable as separate charges for
				  water and electric service furnished by the lessor;
(iii) amounts payable for storage where no
				  designated space under the control of the taxpayer as a tenant is rented for
				  storage purposes; or
(iv) that
				  portion of any rental payment which, in the discretion of the commissioner, is
				  applicable to property subleased by the taxpayer and not used by the taxpayer
				  in the carrying on of the business.
(c) Other valuation methods. If the general
				  method outlined in this subparagraph results in valuations which are inaccurate
				  or which are not fair and equitable, any other method which will fairly and
				  equitably reflect the value may be adopted by the commissioner, either on the
				  commissioner's own motion or on request of a taxpayer. A request by a taxpayer
				  for an alternative method may be made at the time the City of Yonkers earnings
				  tax return to which the request relates is filed. A request is made by using
				  the proposed method in the City of Yonkers earnings tax return. The proposed
				  method must be fully explained in the City of Yonkers earnings tax return. Any
				  request must contain all facts with respect to the property forming the basis
				  for the proposed valuation, and also a computation of the value of the rented
				  real or tangible personal property based on gross rents in accordance with
				  clause (
b
) of this subparagraph. Once approved by the
				  commissioner, such basis or such other method must be used for subsequent years
				  until the facts upon which it is based are materially changed.
(ii) Payroll percentage.
				  The payroll percentage is computed by dividing (
a
) the total
				  wages, salaries and other personal service compensation, paid or incurred
				  during the taxable year to employees in connection with business carried on
				  within the City of Yonkers, by (
b
) the total of all wages,
				  salaries and other personal service compensation, paid or incurred during the
				  taxable year to employees in connection with business carried on both within
				  and without the City of Yonkers.
(iii) Gross income percentage. The gross
				  income percentage is computed by dividing (
a
) the gross sales
				  or charges for services performed by or through an office, branch or agency of
				  the business located within the City of Yonkers, by (
b
) the
				  total of all gross sales or charges for services performed within and without
				  the City of Yonkers. The sales or charges to be allocated to the City of
				  Yonkers include all sales negotiated or consummated, and charges for services
				  performed by an employee, agent, agency or independent contractor chiefly
				  situated at, connected by contract or otherwise with, or sent out from,
				  offices, branches of the business, or other agencies, situated within the City
				  of Yonkers.