NEW YORK CITY DEPARTMENT OF FINANCE Instructions for Form NYC-204

Unincorporated Business Tax Return for Partnerships, including Limited Liability Companies 2020

Single member LLCs using SSN as their primary identifier must use Form NYC-202

Highlights of Recent Tax Law Changes for Partnerships (including Limited Liability Companies)

● New York City’s Business Corporation Tax, General Corporation Tax, Unincorporated Business Tax, and Banking Corporation Tax are decoupled from the federal Coronavirus Aid, Relief, and Economic Security Act (CARES Act) changes to interest expense pro- visions under IRC section 163(j)(10) for tax years beginning in 2019 and 2020. Additionally, for tax years beginning before Jan- uary 1, 2021, the General Corporation Tax, Unincorporated Business Tax, and Banking Corporation Tax are decoupled from CARES Act changes to the net operating loss provisions under IRC section 172. The Unincorporated Business Tax is also decou- pled from CARES Act changes to the limitation on excess business losses of non-corporate taxpayers under IRC section 461(l). Fi- nance Memorandum 20-6 discusses these issues in more detail. ● For details on the proper reporting of income and expenses addressed in the federal Tax Cuts and Jobs Act of 2017, such as manda- tory deemed repatriation income, foreign-derived intangible income (FDII), global intangible low-taxed income (GILTI), please refer to Finance Memorandum 18-10. For information about the IRC section 163(j) limitation on the business interest expense de- duction, please refer to Finance Memorandum 18-11, updated to address New York City’s decoupling from the CARES Act as dis- cussed further above, within these instructions, and in Finance Memorandum 20-6. ● Note that according to the federal Tax Cuts and Jobs Act of 2017, net operating losses generated during or after 2018 generally may no longer be carried back. These losses may be carried forward indefinitely; however, each year’s deduction will be limited to 80% of taxable income (without regard to the deduction).

● Section 18 of part Q of Chapter 60 of the Laws of 2016 amended section 11-514 of the Administrative Code of the City of New York (“Administrative Code”) to provide that for tax years beginning on or after January 1, 2016, calendar year taxpayers which are partnerships for federal tax purposes are required to file tax reports for such year on or before March 15 of the following year, instead of April 15 of the following year, and fiscal year taxpayers must file tax reports for such fiscal year by the 15th day of the third month following the date its tax year ended. Note that the time for filing a declaration of estimated tax set forth in Ad. Code section 11-511 has not changed. ● For taxable years beginning on or after January 1, 2015, federal or state tax base changes should be reported as an Amended Re- turn. See Finance Memorandum 17-5, “Reporting Federal or State Changes”, revised and dated October 10, 2018, for more infor- mation. ● Royalty payments -- For tax years beginning on or after January 1, 2013, the Unincorporated Business Tax has been amended to change the treatment of royalty payments to related members. Under prior law, taxpayers who made royalty payments to related entities were required to add back the amount of the payments to taxable income if those payments were deducted when calculat- ing federal taxable income and if the royalty recipient, under certain conditions, could exclude the royalty income. Ad. Code sec- tion 11-506(e), as amended, eliminates the income exclusion previously allowed to certain royalty recipients and increases to four the number of exceptions to the add-back requirement. Part E of Chapter 59 of the Laws of 2013, § 9. For more information, see “Royalty Payments to Related Members,” below. ● For purposes of the New York City Unincorporated Business Tax, General Corporation Tax, Banking Corporation Tax and Busi- ness Corporation Tax, the City has “decoupled” from the Federal bonus depreciation allowed under IRC section 168(k), except with respect to the depreciation deductions allowed with respect to “qualified New York liberty zone property” and “qualified property” placed in service in the Resurgence Zone (generally the area in the borough of Manhattan south of Houston Street and north of Canal Street.) For City tax purposes, depreciation deductions for all other “qualified property” must be calculated as if the property was placed in service prior to September 11, 2001. See Form NYC-399Z and Finance Memorandum 20-1, “Application of the IRC §280F to Sports Utility Vehicles” for more information.

IMPORTANT INFORMATION CONCERNING FORM NYC-200V AND PAYMENT OF TAX DUE Payments may be made on the NYC Department of Finance website at nyc.gov/eservices, or via check or money order. If pay- ing with check or money order, do not include these payments with your New York City return. Checks and money orders must be accompanied by payment voucher form NYC-200V and sent to the address on the voucher. Form NYC-200V must be post- marked by the return due date to avoid late payment penalties and interest. See form NYC-200V for more information. Instructions for Form NYC-204 - 2020 Page 2

GENERAL INFORMATION years beginning in 1995 that elected tion, and any other activity not constituting to continue to be subject to the Un- an unincorporated business subject to the PARTNERSHIP DEFINED incorporated Business Tax for Unincorporated Business Tax.

For purposes of this form, “partnerships” include years after 1995 on a timely filed Property Defined. Property for this pur- syndicates, groups, pools, joint ventures, limited Unincorporated Business Tax re- pose includes real and personal property, in- liability companies (other than single-member turn for tax year beginning in 1996 cluding property qualifying as investment LLCs) and other unincorporated or incorporated continue to be subject to the Unin- capital (see instructions for Schedule D of organizations classified as partnerships for fed- corporated Business Tax. this form), and other stocks and securities, eral income tax purposes, through or by means of b) any entity subject to the tax im- notional principal contracts, derivative fi- which any business, profession, financial opera- posed by Title 11, Chapter 11 (Util- nancial instruments and other positions in tion or venture is carried on. An estate or trust is ity Tax) of the NYC Administrative property but excluding property and posi- not a partnership and must file using form NYC- Code (except that vendors of utility tions in property held by a dealer, and ex- 202EIN. services are subject to the unincor- cluding debt instruments acquired in the

porated business tax on that per- ordinary course of a trade or business and WHO MUST FILE centage of their entire net income certain other property. See Admin. Code For tax years beginning in 2009 or later, any part- allocable to the City which their §11-502(c)(i)(A). nership that carries on or liquidates any trade, non-utility receipts bear to their business, profession or occupation wholly or total receipts); Notwithstanding anything to the contrary, partly within New York City and has a total gross the receipt of $25,000 or less of gross re- income from all business regardless of where car- c) any entity carrying on an insurance ceipts during the taxable year (determined ried on of more than $95,000 (prior to any de- business as a member of the New without regard to deductions) from an unin- duction for cost of goods sold or services York Insurance Exchange (autho- corporated business will not disqualify the performed) must file an Unincorporated Business rized in Section 6201 of the Insur- taxpayer for this exemption. Tax Return on Form NYC-204. ance Law); Partial Exemption for Investment Activi- Taxpayers that are required to file an Unincorpo- d) Real Estate Mortgage Investment ties: (Admin. Code §11-502(c)(4)) For tax- rated Business Tax Return but have no tax liability Conduits (REMICs). Holders of in- able years beginning after 1995, if a may be eligible to file a Form NYC-204EZ. To de- terests in a REMIC remain taxable taxpayer is an unincorporated entity (not an termine whether you may use Form NYC-204EZ, on such interests or on the income individual) and is primarily engaged in refer to that form. The Form NYC-204EZ may also from such interests. be used by a partnership that is not required to file 1. the activities described above under but wishes to disclaim any liability for tax because e) Wireless Telecommunications Service “Full Exemption for Investment Ac- Providers tivities ”or it is engaged solely in activities that are exempt from the tax. Effective for tax periods beginning 2. the ownership as an investor of inter- on and after August 1, 2002, entities ests in one or more other unincorpo- WHO IS SUBJECT TO THE TAX that receive eighty percent or more of rated entities engaged in an 1) The Unincorporated Business Tax is im- their gross receipts from charges for unincorporated business in the City. posed on any individual or unincorporated providing mobile telecommunica- entity (including a partnership, fiduciary or tions services to customers will be The taxpayer’s own activities described at corporation in liquidation) engaged in any taxed as if they were regulated utili- (1) and the activities of any other unincor- trade, business, profession, or occupation ties for purposes of the New York porated entity primarily engaged in the ac- wholly or partly carried on within New York City Utility Tax and Unincorporated tivities described at (1) and (2) in which City. the taxpayer holds an interest will not be Business Tax. Thus, such entities considered an unincorporated business car- 2) Income received from the practice of law, will be subject to only the New York ried on by the taxpayer and the income medicine, dentistry, architecture, or any City Utility Tax. The amount of from those activities will not be subject to other profession is subject to the unincorpo- gross income subject to tax has been the tax. rated business tax. amended to conform to the Federal Mobile Telecommunications Sourc- prima- 3) S corporations are not subject to the Unin- ing Act of 2000. In addition, for tax A taxpayer will be considered to be rily engaged corporated Business Tax. S Corporations are years beginning on and after August in the activities described at subject to the General Corporation Tax. 1, 2002, partners in any partnership (1) and (2) if at least 90 percent of the av-

subject to the Utility Tax as a “util- erage monthly gross value of its total assets 4) The Unincorporated Business Tax does ity” as defined in Ad. Code section consists of: not apply to: 11-1101(6) will not be subject to Un- a. property as defined above,

a) any entity subject to the tax imposed incorporated Business Tax on their b. interests in unincorporated enti- by Title 11, Chapter 6 of the NYC Ad- distributive share of the income of ties not engaged in any unincor- ministrative Code. For taxable years any such entity. porated business in the City, and beginning in 1996 and thereafter, un- 5) Full Exemption for Investment Activities: incorporated associations and pub- c. interests held as an investor in A partnership, except a dealer as defined in licly-traded partnerships taxable as entities engaged in an unincorpo- Admin. Code §11-501(l), will not be corporations for federal income tax rated business in the City. deemed engaged in an unincorporated busi- purposes under IRC §7701(a) (3) and ness solely by reason of the conduct of the For this purpose, real property and mar- §7704 are subject to the applicable following activities for its own account: the ketable securities are valued at their fair corporate tax under Title 11, Chapter purchasing, holding or selling of property market value and all other assets are valued 6 of the NYC Administrative Code (defined below), engaging in transactions in according to the books and records of the and not the Unincorporated Business positions in property, the acquisition, hold- taxpayer in accordance with generally ac- Tax. However, unincorporated enti- ing or disposition, other than in the ordinary cepted accounting principles (GAAP). ties that were subject to the Unin- course of business, of interests in unincor- corporated Business Tax for tax Investor Defined: For this purpose, a tax- porated entities also eligible for this exemp- Instructions for Form NYC-204 - 2020 Page 3

payer will be considered to hold an interest not taxable on its share of D’s self-trading for by a person other than the person in another entity as an investor if either: income. A is taxable on its share of C’s in- whose vehicle is parked, garaged or (i) the entity would qualify as primarily come other than C’s share of D’s self-trad- stored, such as a merchant validation ing income. of a parking ticket); engaged in the activities described at (1) and (2) above and the taxpayer’s 6) A partnership that is an owner, lessee or fidu- 6. the total number of transactions and share of each item of the entity’s in- ciary will not be deemed engaged in an unin- amount of receipts from sales of come, gain, deduction, credit or loss is corporated business solely by reason of the monthly or longer term parking serv- not materially different from the tax- holding, leasing or managing of real property. ices including a designation of each payer’s share of any other such item, For taxable years beginning on or after July 1, transaction and receipt as exempt from or the 8 percent Manhattan parking tax, 1994, if an individual or unincorporated entity where applicable; and (ii) the taxpayer is neither a general partner is carrying on an unincorporated business in nor managing or participating in the day- whole or in part in the City, and is also hold- 7. the total number of transactions and to-day business of the other entity. See ing, leasing or managing real property as an amount of receipts from sales of Admin. Code §11-502 (c) (1) (B). owner, lessee or fiduciary, the holding, leas- monthly or longer term parking serv- ing or managing of the property will not be ices provided to building tenants. A taxpayer claiming a partial exemption for considered an unincorporated business to the investment activities should attach a copy of extent that the real property is held for the pur- Failure to submit the above information Form NYC-WPE (Worksheet for Partial Ex- poses of producing rental income or gain on with this return will result in all of the in- emption). The partial exemption is illus- the disposition of the real property, provided, come of that garage being subject to tax. trated by the following examples: however, this partial exemption for rental See Section 11-502 (d) of the NYC Admin- real estate is not available to a dealer hold- istrative Code. Example 1: ing real property primarily for sale to cus- In 1996, Partnership A is engaged directly tomers in the ordinary course of the NOTE: If you engage exclusively in an exempt in the purchase and sale of stocks and secu- dealer’s trade or business. The operation by unincorporated business activity but file for rities for its own account in the City. Part- any taxpayer, otherwise eligible for the partial information purposes, use Form NYC-204EZ. nership A also is a limited partner in exemption, of a garage or other business at the Partnership B, which is engaged in the pur- property solely for the benefit of tenants in the ROYALTY PAYMENTS TO RELATED chase and sale of securities for its own ac- property that is not open or available to the MEMBERS count in the City. Partnership A also is a general public will be considered to be inci- For tax years beginning on or after January 1, non-managing member of Limited Liability dental to the holding, leasing or managing of 2013, the Unincorporated Business Tax was been Company C, which is a securities dealer in the property and will not be considered an un- amended to change the treatment of royalty pay- the City. LLC C is subject to tax on all of incorporated business. However, if such a tax- ments to related members. Under prior law, tax- its income. Partnership B is wholly exempt payer operates a garage or other business at payers who made royalty payments to related from tax. entities were required to add back the amount of the property that also is open or available to the general public, that garage or other busi- the payments to taxable income if they were de- Partnership A is not eligible for the full in- ducted when calculating federal taxable income. vestment exemption. However, Partnership ness will be considered a taxable unincorpo- rated business, provided, however, for taxable To avoid double taxation, if the royalty recipient A qualifies as primarily engaged in activi- was also a New York taxpayer, the statute al- ties described at (1) and (2). Therefore, A is years beginning after 1995, if a taxpayer op- erates a garage that is open to building tenants lowed the recipient to exclude the royalty income not taxable on its own self-trading activity if the related member added back the deduction nor on its share of B’s income from self- and the public, the operation of that garage will not be considered a taxable unincorpo- for the royalty payment expense. trading. A is taxable on its share of C’s in- come, gains and losses, including any rated business but only to the extent of income from parking services provided at that garage Ad. Code section 11-506(e), as amended, elimi- income, gains and losses from C’s own self- nates the income exclusion previously allowed to trading activity. Partnership A is not treated to building tenants on a monthly or longer- term basis and only if the information re- certain royalty recipients. It also modifies the as a dealer solely by reason of its member- two previous exceptions to the add-back require- ship in LLC C. quired to be filed with this return specified below is provided with respect to that ment and adds two additional exceptions. Those Example 2: garage. All other income from the operation four exceptions generally can apply in following The facts are the same in example 1 except of that garage will be subject to the tax. situations (for additional conditions that must be that C is also a limited partner in Partner- met, see sections indicated below): The taxpayer must submit with this return a ship D, which is engaged solely in the pur- ● If all or part of the royalty payment a related chase and sale of securities for its own statement containing the following for each garage or other similar facility that is oper- member received was then paid to an unre- account in the City. LLC C’s interest in lated third party during the tax year, that Partnership D represents less than 90 per- ated for the benefit of building tenants and that is open to the general public: portion of the payment will be exempt if the cent of C’s gross assets. Partnership D is transaction giving rise to the original roy- exempt from tax because it is solely trading 1. the parking facility name; alty payment to the related member was un- for its own account. C is taxable on its 2. the parking facility address; dertaken for a valid business purpose, and share of D’s self-trading income because C the related member was subject to tax on the does not qualify as primarily engaged in the 3. the license number of the facility if ap- royalty payment in this city or another city activities described at (1) and (2). A is tax- plicable; within the United States or a foreign nation able on its share of C’s income including or some combination thereof (Ad. Code sec- C’s share of D’s self-trading income. 4. the licensed capacity of the facility if licensed; tion 11-506(e)(2)(B)(i));

Example 3: ● If the taxpayer's related member paid an ag- The facts are the same as in example 2 ex- 5. the total number of transactions and amount of receipts for the taxable year gregate effective rate of tax on the royalty cept that C’s interest in Partnership D rep- payment, to this city or another city within resents 95 percent of C’s gross assets. C from all sales of parking services in- cluding prepaid parking services, all the United States or some combination qualifies as primarily engaged in the activ- thereof, that is not less than 80 percent of ities described at (1) and (2). Therefore C is parking services provided without charge and all parking services paid the rate of tax that applied to the taxpayer Instructions for Form NYC-204 - 2020 Page 4

under Ad. Code section 11-503 for the tax FORM NYC-399Z - Depreciation Adjustments for 19 RCNY Section 28-18(c)(3) for additional ex- year (Ad. Code section 11-506(e)(2)(B)(ii)); Certain Post 9/10/01 Property may have to be filed tensions.) by taxpayers claiming depreciation deductions for ● If the related member is organized under the certain sport utility vehicles or "qualified prop- WHERE TO FILE laws of a foreign country that has a tax erty," other than “qualified property” placed in treaty with the United States, the related All returns, except refund returns: service in the Resurgence Zone, "qualified New member’s income from the transaction was York Liberty Zone property" and "qualified New NYC Department of Finance taxed in such country at an effective rate of York Liberty Zone leasehold improvements" P.O. Box 5564 tax at least equal to that imposed by this placed in service after September 10, 2001 for fed- city, and the transaction giving rise to the Binghamton, NY 13902-5564 eral or New York State tax purposes. See “High- royalty was undertaken for a valid business lights of Recent Tax Law Changes”, Finance Remittances - Pay online with Form NYC-200V purpose and reflected an arm's length rela- Memorandum 20-1, “Application of IRC§280F at nyc.gov/eservices, or Mail payment and tionship. (Ad. Code section 11- Limits to Sport Utility Vehicles” and instructions 506(e)(2)(B)(iii)); or Form NYC-200V only to: to NYC-399Z. ● If the taxpayer and the Department of Finance NYC Department of Finance agree to alternative adjustments that more ap- FORM NYC-CR-A - Commercial Rent Tax An- P.O. Box 3933 propriately reflect the taxpayer's income. nual Return must be filed by every tenant that New York, NY 10008-3933 (Ad. Code section 11-506(e)(2)(B)(iv)). rents premises for business purposes in Manhat- tan south of the center line of 96th Street and Returns claiming refunds: The law as amended also defines the term “re- whose annual or annualized rent for any premises lated member” by linking it to the definition in is at least $200,000. (Effective June 1, 2001). NYC Department of Finance Internal Revenue Code section 465(b)(3)(c), but P.O. Box 5563 substituting 50 percent for the 10 percent owner- FORM NYC-RPT - Real Property Transfer Tax Binghamton, NY 13902-5563 ship threshold. Return must be filed when the partnership ac- quires or disposes of an interest in real property NOTE: If a Declaration of Estimated OTHER FORMS YOU MAY BE located in New York City, including a leasehold Unincorporated Business Tax (Form NYC-5UB) REQUIRED TO FILE interest; when there is a partial or complete liq- is being filed, DO NOT mail it to any address FORM NYC-5UB - Partnership Declaration of uidation of the partnership that owns or leases listed here. It should be mailed to the address in-

Estimated Unincorporated Business Tax must be real property; or when there is transfer of a con- dicated on Form NYC-5UB. filed by every partnership carrying on an unin- trolling economic interest in a partnership that owns or leases real property. corporated business or profession in New York ACCESSING NYC TAX FORMS City and whose estimated tax can reasonably be FORM NYC-WPE- A Partial Exemption Work- By Computer - Download forms from the Fi- expected to exceed $3,400 for the tax year im- sheet must be filed for every partnership claiming nance website at nyc.gov/finance mediately following the tax year covered by this a partial exemption for investment activities. return. By Phone - Order forms by calling 311. If

FORM NYC-NOLD-UBTP - Net Operating Loss calling from outside of the five NYC bor- The declaration must cover a full calendar or fis- Deduction schedule must be included in the unin- oughs, please call 212-NEW-YORK (212-639- cal year and is due on the 15th day of the fourth corporated business tax filing of every unincorpo- 9675). month of the taxable year. rated business claiming a net operating loss For further information about estimated tax pay- deduction. BUSINESS CARRIED ON BOTH ments and due dates see Form NYC-5UB. INSIDE AND OUTSIDE NEW YORK CITY WHEN TO FILE If business is carried on both inside and outside New FORM NYC-EXT - Application for Automatic 6- For taxable years beginning on or after January 1, York City, a fair and equitable portion of the busi- month Extension of Time to File Business In- 2020, Form NYC-204 is due on or before March ness income shall be allocated to New York City. come Tax Return. File Form NYC-EXT on or 15, 2021, or, for fiscal year taxpayers, on or be- If the unincorporated business does not carry on before the due date of the return. fore the 15th day of the third month following the business both inside and outside of New York close of the taxable year. FORM NYC-115 - Unincorporated Business Tax City, all of the business income shall be allocated Report of Change in Taxable Income made by the If a partnership is terminated and completely liq- to New York City. (Refer to the instructions for Internal Revenue Service and/or New York State uidated during its normal taxable year, resulting Schedule E, Business Allocation Schedule.) Department of Taxation and Finance must be in an accounting period of less than 12 months used for reporting adjustments in taxable income for federal income tax purposes, the due date is BUSINESS TERMINATED DURING resulting from an Internal Revenue Service audit the 15th day of the third month following the end TAXABLE YEAR of your federal income tax return and/or a New of the accounting period. If the business was terminated during 2020, at- York State Department of Taxation and Finance tach a statement to Form NYC-204 showing dis- audit of your State income tax return for taxable An automatic extension of six months for filing position of the business property and how it was years beginning prior to January 1, 2015 only. this return will be allowed if, within the time pre- reported on the return. Check the box marked scribed for filing, the taxpayer files with the De- final return on page 1 of the return. FORM NYC-221 - Underpayment of Estimated partment of Finance Form NYC-EXT and pays the Unincorporated Business Tax will help you de- amount properly estimated as its tax. See the in- USE OF FEDERAL FIGURES termine if you have underpaid an estimated tax structions for Form NYC-EXT for information re- Except where otherwise indicated, items of business installment and, if so, compute the penalty due. garding what constitutes a properly estimated tax income, gain, loss or deduction are to be entered on for this purpose. Failure to pay a properly esti- the return as reportable for federal tax purposes. All FORM NYC-399 - Schedule of New York City mated amount will result in a denial of the exten- Depreciation Adjustments must be used to com- items reported on Form NYC-204 derived from fed- sion. eral partnership returns are, however, subject to veri- pute the allowable New York City depreciation deduction if you claim the federal ACRS or fication, audit and revision by the Department of No additional extension for filing a return will be Finance. Report the character of a partner’s share of MACRS depreciation deduction for certain prop- granted beyond the six-month extension, unless erty placed in service after December 31, 1980. income, gains, losses and deductions from a partner- the taxpayer is outside the United States. (Tax- ship as if it were realized directly by the partner re- See the instructions for Form NYC-399. payers outside the United States should refer to gardless of how the partner acquired its partnership Instructions for Form NYC-204 - 2020 Page 5 interest and regardless of whether the partner’s share filed separately and should not be attached to any SPECIFIC INSTRUCTIONS of such items is disproportionate to its interest in cap- return. ital. The preceding sentence does not apply to guar- Period Covered anteed payments or other payments to the partner If an amended federal or New York State return is File the 2020 return for calendar year 2020 and treated as made to one who is not a partner for federal filed reflecting a change in unincorporated busi- fiscal years that begin in 2020 and end in 2021. income tax purposes, and does not affect the treatment ness income or deductions, an amended Unincor- For a fiscal or short tax year return, fill in the tax of any item as being derived from an unincorporated porated Business Tax return must be filed within year space at the top of the form. The 2020 Form business carried on in the City by the partner. 90 days. Use Form NYC-204 to file an amended NYC-204 also can be used if: return and check the box on page 1.

FEDERAL OR NEW YORK STATE ● You have a tax year of less than 12 months ACCOUNTING PERIODS CHANGES that begins and ends in 2021, and AND METHODS For taxable years beginning on or after January 1, The accounting period for which Form NYC-204 2015, changes in taxable income or other tax base ● The 2021 Form NYC-204 is not available at is filed and the method of accounting used are the made by the Internal Revenue Service (“IRS”) the time you are required to file the return. same as for federal income tax purposes. If a and /or New York State Department of Taxation partnership’s taxable year or method of account- and Finance (“DTF”) will no longer be reported You must show the 2021 tax year on the 2020 ing is changed for federal income tax purposes, on Form NYC-115. Instead, taxpayers must re- Form NYC-204 and take into account any tax law the change must also be made for purposes of the port these federal or state changes to taxable in- changes that are effective for tax years beginning Unincorporated Business Tax. come or other tax base by filing an amended after December 31, 2020. return. This amended return must include a tax PENALTIES worksheet that identifies each change to the tax The law imposes penalties for failure to file a re- Amended Return base (“Tax Base Change”) and shows how each turn or to pay any tax when due, or for making, If this is an amended return, check the box on such Tax Base Change affects the taxpayer’s cal- rendering, signing, certifying or filing a false or page 1. culation of its New York City tax. A template for fraudulent return, or for making a false certifica- the tax worksheet is available on the DOF web- tion. The mere fact that the figures reported on September 11, 2001 Related Tax Benefits site at nyc.gov/finance. This amended return Form NYC-204 are taken from the federal return Check the box on page 1 of this form if, on your must also include a copy of the IRS and/or DTF will not relieve the partnership from the imposi- federal return: (i) you reported bonus depreciation final determination, waiver, or notice of carryback tion of penalties because of negligence or for fil- and/or a first year expense deduction under IRC allowance. Taxpayers that have federal and state ing a false or fraudulent return. §179 for "qualified New York Liberty Zone prop- Tax Base Changes for the same tax period may re- erty," "qualified New York Liberty Zone leasehold port these changes on the same amended return TAX PREPARERS improvements," or "qualified Resurgence Zone that includes separate tax worksheet for the IRS Anyone who prepares a return for a fee must sign property," regardless of whether you are required Tax Base Changes and the DTF Tax Base the return as a paid preparer and enter his or her to file form NYC-399Z or (ii) you replaced prop- Changes. Social Security Number or PTIN. Include the erty involuntarily converted as a result of the at- company or corporation name and Employer tacks on the World Trade Center during the five The Amended Return checkbox on the return is to Identification Number, if applicable. (5) year extended replacement period. You must be used for reporting an IRS or DTF Tax Base attach Federal forms 4562, 4684 and 4797 to this Changes, with the appropriate box for the agency Preparer Authorization: If you want to allow return. See instructions for Schedule B, lines 14c making the Tax Base Changes also checked. Tax- the Department of Finance to discuss your return and 19 for more information. payers must file an amended return for Tax Base with the paid preparer who signed it, you must Changes within 90 days after (i) a final determi- check the "yes" box in the signature area of the Special Condition Codes nation on the part of the IRS or DTF, or (ii) the return. This authorization applies only to the in- At the time this form is being published, there are signing of a waiver under IRC §6312(d) or NY dividual whose signature appears in the "Pre- no applicable special condition codes for tax year Tax Law §681(f). parer's Use Only" section of your return. It does 2020. Check the Finance website for updated spe- not apply to the firm, if any, shown in that sec- cial condition codes. If applicable, enter the two If the taxpayer believes that any Tax Base Change tion. By checking the "Yes" box, you are author- character code in the box provided on the form. is erroneous or should not apply to its City tax izing the Department of Finance to call the calculation, it should not incorporate that Tax preparer to answer any questions that may arise SCHEDULE A Base Change into its City tax calculation on its during the processing of your return. Also, you Computation of Tax amended return. However, the taxpayer must at- are authorizing the preparer to: LINE 1 - BUSINESS INCOME tach: (i) a statement to its report that explains why ● Give the Department any information miss- Enter on line 1, the total from page 3, Schedule it believes the adjustment is erroneous or inappli- ing from your return, B, line 31. cable; (ii) the tax worksheet that identifies each

Tax Base Change and shows how each would af- ● Call the Department for information about LINE 3a - INCOME, GAIN OR LOSS FROM fect its City tax calculation; and (iii) a copy of the the processing of your return or the status NYC REAL PROPERTY IRS and/or DTF final determination or waiver. of your refund or payment(s), and The business allocation percentage is not applied ● Respond to certain notices that you have to income from rentals of New York City real For more information on federal or state Tax Base shared with the preparer about math er- property or gains or losses from the sale of New Changes, including a more expansive explanation rors, offsets, and return preparation. The York City real property. Enter here the modified of how taxpayers must report these changes as notices will not be sent to the preparer. gain (or loss) from the sale or exchange and net well as a sample of the explanatory schedule to income from rental of real property located in be included within the amended return, see Fi- You are not authorizing the preparer to receive any New York City included on line 1 of Schedule A. nance Memorandum 17-5, revised and dated Oc- refund check, bind you to anything (including any This is the gain (or loss) and net rental income tober 10, 2018. additional tax liability), or otherwise represent you included on line 12 of Schedule B, as adjusted before the Department. The authorization cannot be for the portion of the New York City modifica- For taxable years beginning prior to January 1, revoked, however, the authorization will automati- tions (Schedule B, part 2) applicable to such 2015 only Form NYC-115 is to be used to report cally expire no later than the due date (without re- items. If New York City modifications are not changes in taxable income or other tax base made gard to any extensions) for filing next year's return. applicable, enter on line 3a the full amount of by the IRS and /or DTF. Form NYC-115 must be Failure to check the box will be deemed a denial of authority. gain (or loss) and net rental income included on Instructions for Form NYC-204 - 2020 Page 6 line 12 of Schedule B. (Refer to “Who is Subject located to the City for purposes of determining for all but the first $10,000 of the loss. to the Tax,” paragraph 6.) its own investment income. Losses that are not permitted to be carried back LINE 3b Taxpayers who added back a distributive share may be carried forward and used to offset income Taxpayers who subtracted a distributive share of of investment loss or deductions from another for the period permitted for Federal Tax pur- income or gain from another partnership, other partnership, other than a mobile telecommuni- poses, 20 years for losses from years beginning than a mobile telecommunication partnership, cation partnership, on line 15 of Schedule B of after 8/5/97 and prior to years ending after 12/31/17. on line 23 of Schedule B of this form should add this form should subtract the same percentage back the same percentage of such income or of such loss or deductions as the other partner- If a “carryback” results in an overpayment of a gain as the other partnership allocated to the ship allocated to the City for purposes of deter- prior year’s tax, a claim for refund should be City for purposes of determining its own busi- mining its own partnership income. Because filed within the limitation period prescribed by ness income. New York City has decoupled from the provi- law. This claim should be accompanied by a copy sions of IRC § 163(j)(10) as amended by the Taxpayers who added back a distributive share of Form NYC-204 filed for the taxable year for CARES Act (Public Law 116-136) additional of business loss or deductions from another part- which the refund is claimed and a detailed state- adjustments to the amount included on this line nership, other than a mobile telecommunication ment of the computation. may be required. See Finance Memorandum partnership, on line 15 of Schedule B of this 18-11 for additional information. form should subtract the same percentage of LINE 11 - NEW YORK CITY NET OPERATING LOSS DEDUCTION such loss or deductions as the other partnership LINE 9 - ALLOCATED INVESTMENT allocated to the City for purposes of determining If the partnership had an unincorporated business INCOME net operating loss in a prior year any part of which its own business income. See instructions for Only the amount on line 7a should be multiplied lines 15 and 23. may be carried over to 2020, the amount claimed by the IAP. After determining the product of the for 2020 should be entered on line 11 after com- Because New York City has decoupled from the amount on line 7a and the IAP enter the sum of pleting Form NYC-NOLD-UBTP. (Refer to in- provisions of IRC § 163(j)(10) as amended by that product and the amount on line 7b on this structions for NYC-NOLD-UBTP.) the CARES Act (Public Law 116-136) additional line. If the investment allocation percentage is adjustments to the amount included on this line zero, interest on bank accounts must be multi- LINE 13 - ALLOWANCE FOR ACTIVE may be required. See Finance Memorandum 18- plied by the business allocation percentage. PARTNERS’ SERVICES 11 for additional information. A deduction may be claimed for reasonable com- LINE 10 – TOTAL BEFORE NOL pensation for personal services rendered by the Receipts from vendors of utility services, as de- DEDUCTIONS partners. The allowable deduction is: fined in Ad. Code section 11-1101(7), that are For taxpayers using formula allocation, enter on line taxed under Ch. 11 of Title 11 of the Ad. Code 10 the sum of the amount on line 9 and the amounts on 1) 20% of line 12, or are not subject to the unincorporated business lines 5 and 6. 2) $10,000 for each active partner, tax. Taxpayers whose income includes such re- ceipts should exclude them from taxable income UNINCORPORATED BUSINESS NET whichever is lower. If line 12 is a loss, enter “0” on by making a subtraction on this line. To deter- OPERATING LOSS line 13. This deduction is not dependent on mine the amount to be entered on this line tax- If line 10 shows a net loss from business, this loss amounts actually withdrawn by the partners as payers should first multiply entire net income is the 2020 unincorporated business net operating salaries and is in lieu of any deduction for salaries allocated to the City by a fraction, the numerator loss. Amendments made to IRC section 172 by credited or paid to or withdrawn by them. Enter in of which is the total receipts allocated to the City section 2303 of the CARES Act do not apply to the box provided on line 13 the number of partners less the receipts subject to tax under Ch. 11 of NYC NOL computations for tax years beginning actively engaged in the business. Title 11 of the Ad. Code and the denominator of before January 1, 2021. Therefore, the deduction which is the total receipts allocated to the City. of losses incurred in taxable years beginning on or LINE 15 - SPECIFIC EXEMPTION The product should be subtracted from the allo- after January 1, 2018 continues to be limited to A specific exemption of $5,000 is allowed cated business income. The resulting amount is 80% of New York City taxable income. Addition- against net income reported on line 14. If more subtracted on this line and a detailed statement ally, NOLs generated in tax years beginning on or than one business was carried on by the partner- of the calculations should be attached with the re- after January 1, 2020 and before January 1, 2021 ship, only one exemption of $5,000 is allowed turn. may not be carried back to any prior year. See also against the combined net income derived from all Form NYC-NOLD-UBTP. business activities.

EXAMPLE The specific exemption of $5,000 must be pro- If total receipts allocated to the City are $1,500, For prior year losses, only the first $10,000 of rated on a $13.70 daily basis if the business was out which $500 represents receipts from vendor each year’s loss may be carried back. The carry- carried on for a period of less than a full taxable of utility services, the amount on Line 1 is $900 back period for City purposes generally corre- year of 12 months, unless the business was car- and the business allocation percentage is 75%, sponds to the federal carryback period available ried on and the returns filed for a number of the amount to be entered on line 3b is calculated for individuals. Because a partnership does not whole months. In that case, the proration is as follows: carry over NOLs, it will not have made a Federal $416.67 per month. election with regard to any net operating loss car- 1) $900 X 75% = $675 ryover. Therefore, for City tax purposes for prior EXAMPLE

year losses arising in taxable years ending in or #1 If the partnership carried on business for a 2) $675 X $1,500 – $500 = $450 $1,500 after 2002, unless the taxpayer attaches a state- full 9 months, the exemption amount to be ment to this return indicating that the taxpayer in- entered on line 15 is $3,750.03 (9 months X 3) Subtract $225 ($675 – $450) on line 3b. tends to carry back the first $10,000 of the current $416.67 per full month). year's loss for either 2 or 5 years, the taxpayer is LINE 7b presumed to have elected to relinquish the entire #2 If the partnership carried on business for Taxpayers who subtracted a distributive share of carryback period. 263 days, the exemption amount to be en- investment income or gain from another part- tered on line 15 is $3,603.10 (263 days X nership, other than a mobile telecommunication If the taxpayer elects to carry back the first $13.70 per day). partnership, on line 23 of Schedule B of this $10,000 of the loss, any excess net operating loss form should add back the same percentage of may be carried forward as if the taxpayer had Taxpayers filing a short period return should such income or gain as the other partnership al- elected to relinquish the entire carryback period fill in the dates at the top of page 1 of the re- Instructions for Form NYC-204 - 2020 Page 7 turn and prorate the specific exemption as de- LINE 22c - LOWER MANHATTAN RELO- LINE 31 - TOTAL REMITTANCE DUE scribed above. CATION AND EMPLOYMENT ASSIS- If the amount on line 26 is not greater than zero, enter TANCE PROGRAM (LMREAP) CREDIT on line 31 the sum of the amount on line 25 and the LINE 16 - TAXABLE INCOME Refer to instructions on Form NYC-114.8 and at- amount by which line 28 exceeds line 26, if any. If If line 16 is a loss refer to the instructions for tach form. filing and paying electronically, enter the amount of Schedule A, line 10. your remittance on Line A. If not paying electroni- LINE 22e - BEER PRODUCTION CREDIT cally, leave Line A blank. All remittances must be LINE 18- BUSINESS TAX CREDIT Enter on this line the NYC beer production credit. payable in U.S. dollars drawn on a U.S. bank. ● If the amount entered on line 17 is $5,400 or (Attach Form NYC-114.12). Checks drawn on foreign banks will be rejected and returned. Remittances must be payable to: over, no credit is allowable; enter “0” on line 18. LINE 24 - PAYMENT OF NYC Department of Finance. ● If the amount entered on line 17 is $3,400 ESTIMATED TAX The entire balance due must be paid with the re- or less, your credit is the entire amount of Enter on line 24 the sum of all payments of esti- turn and is not to be transferred to or paid on any mated tax made for calendar year 2020 or fiscal tax on line 17. No tax will be due. other return. year beginning in 2020 including carryover credit ● If the amount of tax entered on line 17 ex- from the preceding taxable year, and payment SCHEDULE B ceeds $3,400 but is less than $5,400, a with extension, NYC-EXT. Complete table on Computation of Total Income credit is allowed in the amount determined page 2 of this return. by multiplying the tax on line 17 by a frac- PART 1 - ITEMS OF BUSINESS INCOME, tion, the numerator of which is $5,400 LINE 27a - LATE PAYMENT/INTEREST GAIN, LOSS OR DEDUCTION minus the amount of the tax on line 17 and If the tax is not paid on or before the due date (de- Amounts on lines 1 through 10 are to be entered the denominator of which is $2,000. Use termined without regard to any extension of time), from the federal Partnership Tax Return and interest must be paid on the amount of the under- Schedule K. Attach federal Form 1065 or Form the following formula: payment from the due date to the date paid. For 1065-B and all schedules, including individual information regarding interest rates, visit the De- FORMULA Schedules K-1. partment of Finance website at Where a partnership carries on two or more unincor- amount ($5,400 - tax on line 17) = business www1.nyc.gov/site/finance/taxes/business-interest- on line 17 x tax credit porated businesses, either wholly or partly in New $2,000 rates.page or call 311. If calling from outside of the York City, all are treated as one business for purposes five NYC boroughs, please call 212-NEW-YORK EXAMPLE of the Unincorporated Business Tax. Combine the (212-639-9675). For further information about esti- net income of all business activities and enter on lines If the tax on line 17 is $3,900, the business tax mated tax payments and due dates see Form NYC- 1 through 9. An unincorporated entity (not an indi- credit is calculated as follows: 5UB. vidual) is considered to be carrying on any trade, 1) $3,900 X ($5,400 - $3,900) = $2,925 LINE 27b - LATE PAYMENT OR LATE business, profession or occupation carried on in the $2,000 FILING/ADDITIONAL CHARGES City by any other unincorporated entity in which the taxpayer owns an interest. An unincorporated entity a) A late filing penalty is assessed if you fail 2) Enter $2,925 on line 18 will not be considered to be conducting an unincor- to file this form when due, unless the failure 3) Enter $975 ($3,900 - $2,925) on line 19 (Un- is due to reasonable cause. For every month porated business in the City as a result of owning an incorporated Business Tax). or partial month that this form is late, add to interest in another unincorporated entity if the sec- the tax (less any payments made on or be- ond entity is not engaged in any activity in the City.

LINE 19 - TAX BEFORE UBT PAID CREDIT fore the due date) 5%, up to a total of 25%. Enter on line 19 the Unincorporated Business Tax NOTE: A partnership that makes an election under IRC Section 754 may not adjust the basis of its assets on the due before applying the UBT paid credit. If the b) If this form is filed more than 60 days late, sale or purchase of an interest in the partnership. credit on line 18 equals the tax shown on line 17, the above late filing penalty cannot be less enter “0” on line 19. than the lesser of (1) $100 or (2) 100% of the LINES 1, 2, 3 AND 4 amount required to be shown on the form LINE 20 - UBT PAID CREDIT (less any payments made by the due date or Enter on line 1 the ordinary income (loss) from credits claimed on the return). Enter on line 20 the credit against the Unincor- federal Form 1065, line 22 or 1065-B, Part I, line porated Business Tax paid by partnerships from c) A late payment penalty is assessed if you 25. Enter on line 2 net income (loss) from all which you receive a distributive share or guaran- fail to pay the tax shown on this form by the rental real estate activity not included on line 1 teed payment that you include in unincorporated prescribed filing date, unless the failure is but included on Schedule K of federal Form 1065 business taxable income. (Attach Form NYC- due to reasonable cause. For every month or or 1065-B. Enter on line 3 portfolio income in- 114.7, UBT Paid Credit.) partial month that your payment is late, add cluded on federal Schedule K. Enter on line 4 to the tax (less any payments made) 1/2%, guaranteed payments to partners properly re- LINE 21 - UNINCORPORATED up to a total of 25%. portable on Schedule K. BUSINESS TAX If the balance is less than zero, enter “0.” d) The total of the additional charges in a and Portfolio income includes interest, dividends, c may not exceed 5% for any one month ex- royalties, annuity income and gain (loss) on the LINE 22a - RELOCATION AND EMPLOY- cept as provided for in b. disposition of property. (Attach a schedule indi-

MENT ASSISTANCE PROGRAM (REAP) cating type and amount of portfolio income.) If you claim not to be liable for these additional CREDITS charges, attach a statement to your return ex- LINE 8 - ADDBACK OF OTHER Refer to instructions on Form NYC-114.5 and at- plaining the delay in filing, payment or both. DEDUCTIONS tach form. Enter on line 8 those deductions included in lines LINE 22b - REAL ESTATE TAX ESCALA- LINES 29 and 30 - NET OVERPAYMENT 1 and 2 that are not allowed in computing unin- TION, INDUSTRIAL BUSINESS ZONE AND If there is an overpayment on line 29, enter on line corporated business taxable income, other than EMPLOYMENT OPPORTUNITY RELOCA- 30a the amount of overpayment to be refunded. the guaranteed payments entered on line 4, the TION COSTS CREDITS Enter on line 30b the amount to be credited to the payments to current or retired partners on line 5 Refer to instructions on Form NYC-114.6, Claim 2021 estimated tax on Form NYC-5UB. If line 23 and the New York City modifications on lines 13 for Credit Applied to Unincorporated Business is less than zero, disregard negative sign and add through 15. For example, the partnership’s con- Tax and attach form. that amount to line 24. tributions to retirement plans for partners (if de- Instructions for Form NYC-204 - 2020 Page 8 ducted on Form 1065, page 1 or Form 1065-B) ii) expenses that relate to exempt in- automobile was acquired before September 28, are entered on line 8. come or to property held for the pro- 2018, the first year additional depreciation is duction of exempt income; and phased down to $6,400 in the case of an automo-

LINE 9 - OTHER ITEMS bile placed in service during 2018 and to $4,800 iii) amortization of bond premium on Enter the net amount of the partners’ distributive in the case of automobile placed in service during any bond, the interest on which con- shares of income and deduction items not in- 2019. stitutes exempt income. cluded in any other line on Form NYC-204,

Schedule B, but required to be reported separately For tax years beginning on or after January 1, Line 14c: The Federal bonus depreciation allowed to complete federal Form 1065 or 1065-B. (Attach 2004, other than for eligible farmers (for purposes for "qualified property," as defined in IRC section schedule.) Deduction items reported separately of the New York State farmers' school tax credit), 168(k) is not allowed for Unincorporated Business on Form 1065 or 1065-B that constitute payments the amount allowed as a deduction with respect to Tax purposes except for such deductions allowed to partners for purposes of the Unincorporated a sport utility vehicle that is not a passenger auto- with respect to "qualified New York liberty zone Business Tax, such as amounts paid for a partner’s mobile for purposes of section 280F(d)(5) of the property", "qualified New York liberty zone lease- medical insurance are not deductible for Unin- Internal Revenue Code is limited to the amount al- hold improvements" and "qualified property" corporated Business Tax purposes. These lowed under section 280F of the Internal Revenue placed in service in the Resurgence Zone (gener- amounts should be listed on the attached sched- Code as if the vehicle were a passenger automo- ally the area in the borough of Manhattan South of ule for informational purposes, but not deducted bile as defined in that section. SUVs which are Houston Street and North of Canal Street.) For in determining the net amount to be entered on entitled to Federal first-year bonus depreciation more information on Federal bonus depreciation, this line. under IRC section 168(k) are not entitled to bonus see Form NYC-399Z and that Form’s instructions. depreciation for New York City purposes except LINE 11 - INCOME OR GAIN - SALE OR For City tax purposes, depreciation deductions for for SUVs that are “qualified Resurgence Zone EXCHANGE OF REAL PROPERTY all other "qualified property" must be calculated property.” On the disposition of an SUV subject to Rental income or loss from real property located as if the property was placed in service prior to the limitation, the amount of any gain or loss in- outside New York City and gain or loss on disposi- September 11, 2001. cluded in income must be adjusted to reflect the tion of real property located outside New York City limited deductions allowed for City purposes are not considered for purposes of computing the un- Section 13201(b) of the Tax Cuts and Jobs Act of under this provision. Enter on Schedule B, lines incorporated business tax. Therefore, to exclude this 2017 (“TCJA”) extended the bonus depreciation 14(c) and 19 the appropriate adjustments from income, gain or loss, subtract on line 11 the amount deduction to cover property placed in service be- form NYC-399Z. See Finance Memorandum 20-1, included on line 10 if income or gain is reported, and fore January 1, 2027 (except for aircraft and long- “Application of IRC §280F Limits to Sport Utility add this amount on line 11 if a loss is reported. Do production period property have to be placed into not exclude the rental income from property located Vehicles” for more information. service before January 1, 2028.) Previously, Sec- in New York City even if not considered an unin- tion 143 of the Protecting Americans from Tax The federal depreciation deduction computed corporated business. (Refer to “Who is Subject to Hikes Act of 2015, Pub. L. No.114-113, Div Q under the Accelerated Cost Recovery System the Tax”, paragraph 6)(See instructions for line (December 18, 2015)(“2015 PATH Act”) had ex- (ACRS) or the Modified Accelerated Cost Recov- 14(d).) tended bonus depreciation so that it was available ery System (MACRS) (IRC Section 168) is not al- PART 2 - NEW YORK CITY for property acquired and placed in service during lowed for property placed in service in New York MODIFICATIONS 2015-2019; bonus depreciation was extended State in taxable years beginning before January 1, It may be necessary to make certain additions to through 2020 for certain property with a longer 1985 (except recovery property subject to the pro- or subtractions from the amount reported on production period. Under the 2015 PATH Act, the visions of IRC Section 280-F). Schedule B, part 1, line 12 to arrive at total in- bonus depreciation is 50% for property placed in come from business to be reported on line 26. If service during 2015-2017, 40% for property ACRS and MACRS may not be allowed for prop- any of the following items is applicable, com- placed in service during 2018, and 30% for prop- erty placed in service outside of New York State plete part 2 showing the nature and amount of erty placed in service during 2019. in taxable years beginning after 1984 and before each item. If none of these applies, transfer the January 1, 1994 (except property subject to the amount on line 12 to line 26 of Schedule B. Pursuant to section 13201(a) of the TCJA, for provisions of IRC Section 280-F). property placed in service after September 27, - ADDITIONS - 2017, the bonus depreciation rate was raised to For additional information regarding depreciation 100% with the phase-down to begin in 2023. The deductions for property placed in service outside LINE 13 - INCOME AND taxpayer can elect to apply a 50% depreciation rate of New York after 1984 and before 1994, see Fi- UNINCORPORATED BUSINESS TAXES for property placed in service in the taxpayer’s nance Memorandum 99-4 “Depreciation for Enter the amount of income and unincorporated first tax year ending after September 27, 2017. Property Placed in Service Outside New York business taxes imposed by New York City, New The phase-down of the bonus depreciation enacted after 1984 and Before 1994”.

York State or any other taxing jurisdiction that under the 2015 PATH Act is still applicable to In place of the federal depreciation deduction, a were deducted in computing part 1, line 12. property acquired before September 28, 2017. depreciation deduction using pre-ACRS or Thus, for property acquired before September 28, MACRS rules (IRC Section 167) is allowed. LINE 14 - MODIFICATIONS RELATING TO 2017 and placed in service in 2018, the bonus de- Enter on line 14c the ACRS depreciation deduc- ITEMS OF TAX CREDIT AND DEDUCTION preciation is 40% and 30% for property placed in tion used in computing, part 1, line 12. (Refer to Line 14a: Taxpayers claiming the real estate tax service in 2019 with no bonus depreciation for instructions for line 19.) (Attach Form NYC-399 escalation credit or employment opportunity relo- property placed in service after 2019. Under the and/or NYC-399Z.) cation costs credit or industrial business zone TCJA the first year depreciation limit increase of credit must enter the sum of the amounts shown $8,000 for passenger automobiles under Line 14d: Exempt Activities. Deductions and losses on lines 4 and 5, respectively, of Form NYC- §280(F)(a)(1)(A) is extended to include automo- attributable to activities not considered part of an un- 114.6. biles placed in service on or before December 31, 2026. Prior to that, in order to qualify for the incorporated business must be added back. See “Who is Subject to the Tax”. Line 14b: Enter any amounts deducted in $8,000 increase in bonus depreciation, the passen- Add back losses, in- computing part 1, line 12, for: ger automobile would had to have been placed into terest, depreciation and any other expenses deducted for federal income tax purposes directly or indirectly i) service on or before December 31, 2019. This ex- interest on money borrowed to pur- attributable to the holding, leasing or managing of chase or carry bonds or securities, tension of the placed in service deadline only ap- plies to automobiles acquired on or after real property (including any business conducted at the interest on which is exempt from the property as an incidental service to tenants) or the Unincorporated Business Tax; September 28, 2017. However, if the passenger Instructions for Form NYC-204 - 2020 Page 9 to the income or gain therefrom, if such holding, 3) royalty and interest payments made to re- tion is not allowed pursuant to the provisions of leasing or managing of property is exempt from Un- lated members as required by Ad. Code sec- Section 280C of the Internal Revenue Code. (At- incorporated Business Tax under NYC Administra- tion 11-506(e). (See Royalty Payments to tach federal Form 5884 or any other applicable tive Code Section 11-502(d) in taxable years Related Members, page 3) federal forms.) beginning on or after July 1, 1994 or January 1, 1996, in the case of parking services rendered to ten- 4) any other additions required by Sections 11- LINE 19 - DEPRECIATION ants at a garage open to the public. (Refer to “Who 506 and 11-507 of the NYC Administrative ADJUSTMENT is Subject to the Tax”, paragraph 6.) Code. (Attach any appropriate schedules.) If a taxpayer took the additional depreciation de- duction on its federal return with respect to “qual- Add back losses, interest or other expenses de- Adjustments relating to IRC section 163(j)(10): ified property” OTHER THAN “qualified ducted for federal income tax purposes directly Resurgence Zone property”, “qualified New York or indirectly attributable to notional principal Pursuant to Administrative Code § 11-506(b)(17), Liberty Zone property” and “qualified New York contracts, the holding, sale, disposition, assump- for taxable years beginning in 2020, UBT tax- Liberty Zone leasehold improvements or SUVs for tion, offset or termination of a position in prop- payers must add back to federal gross income the which an addback was required under the instruc- erty as defined in Admin. Code §11-502(c) (1) amount of any increase in the federal interest ex- tions to Line 14(c) of this schedule, use NYC-399Z (A), or other substantially similar losses from or- pense deduction allowed pursuant to IRC § to calculate the amount of the deduction that may dinary and routine trading or investment activity 163(j)(10). As a result, UBT taxpayers who have be deducted for City purposes. The amount ap- as determined by the Commissioner, realized in deducted on their federal return an amount of in- pearing in column B of line 8 on Form NYC-399Z connection with certain investment activities to terest expense pursuant to IRC § 163(j)(10) must should be included on this line. See “Highlights of the extent such activities are considered exempt add back such amounts. Attach a pro forma Form Recent Tax Law Changes”, and Finance Memo- from the Unincorporated Business Tax. Refer to 8990 incorporating the required adjustments randum 20-1, “Application of IRC §280F Limits “Who is Subject to the Tax”, Paragraph 5. along with a statement showing the taxpayer’s to Sport Utility Vehicles” for more information. In the case of a taxpayer that qualifies for the par- computation of the New York City interest ex- tial investment exemption (see: “Who is Subject pense limitation as well as the addback amount. In place of the disallowed ACRS deduction for to the Tax”, paragraph 5), add back losses, inter- A copy of Form 8990 filed with the IRS should certain property, line 14c, a depreciation deduc- est or other expenses deducted for federal income also be submitted. tion computed by any method permitted under tax purposes directly or indirectly attributable to IRC Section 167 as in effect on December 31, the sale or other disposition of an interest in an- For more information, see Finance Memorandum 1980, will be allowed. Enter on line 19 the other unincorporated entity to the extent attribut- 18-11. ACRS adjustment from Form NYC-399, Sched- ule C, line 8B. (Attach Form NYC-399.) (See in- able to activities of that entity covered by the Adjustments relating to IRC section 461(l): taxpayer’s partial exemption. structions for line 14c and Finance Memorandum 99-4 “Depreciation for Property Placed in Serv- Under provisions enacted by the TCJA, business LINE 15 - OTHER ADDITIONS ice Outside New York After 1984 and Before losses of non-corporate taxpayers were limited 1994”.) If you have received a distributive share of in- by IRC section 461(l) to the sum of a taxpayer’s vestment or business loss or deductions from any aggregate trade or business gross income or gain LINE 20 - EXEMPT INCOME partnership, other than a mobile telecommunica- plus a threshold amount, $500,000 annually for Attach a schedule showing nature and amount of tions partnership as described below, add back married taxpayers filing jointly and $250,000 for exempt income, such as: here any distributive share amounts of such loss all other taxpayers (adjusted for inflation). Sec- 1) interest income on United States obligations or deductions included in calculating the amount tion 2304 of the CARES Act repeals the excess included in computing part 1, line 12; on line 12 of this schedule and not previously business loss limitation under IRC section 461(l) added back on line 11. NOTE: A corresponding for tax years beginning after December 31, 2017 2) interest or dividend income on bonds or se- subtraction may have to be made on Schedule A, and before January 1, 2021. and includes several curities of any United States authority, com- line 3b or 7b. See instructions for those lines. technical corrections to IRC section 461(l). New mission or instrumentality included in

York City’s Unincorporated Business Tax is de- computing part 1, line 12 but exempt from Mobile Telecommunications Partnerships. For coupled from all CARES Act changes to IRC sec- state or local income taxes under United tax years beginning on or after August 1, 2002, tion 461 for taxable years beginning before States law; or partnerships that are partners in partnerships that January 1, 2021. receive at least eighty percent of their gross re- 3) interest or dividend income on bonds or se- ceipts from providing mobile telecommunications For taxable years beginning before January 1, curities to the extent exempt from income services should add back here any distributive 2021 taxpayers are required to add the amount of tax under New York laws authorizing the is- share of losses or deductions from any such part- any increase in the federal deduction allowed suance of these bonds or securities, but in- nership, including their share of separately re- pursuant to CARES Act amendments to IRC sec- cluded in computing part 1, line 12. ported items included in calculating the amount tion 461(l) to the federal gross income of the un- on line 1 of this schedule. There is no correspon- incorporated business. Include on this line the LINE 21 - DIVIDENDS ding subtraction on Schedule A for these amounts. Enter 50% of dividends other than dividends amount of any increase in the federal deduction allowed pursuant to CARES act amendments to from stocks not meeting the holding period re- Describe in a separate schedule the nature and quirement set forth in IRC Section 246(c). amount of any additions, such as: IRC section 461(l).

1) interest income on state and local bonds - SUBTRACTIONS - LINE 22 - EXEMPT ACTIVITIES

held in connection with the business (other Subtract income or gain includible in gross income LINE 17 - INCOME AND UNINCORPO- than on bonds of New York State and its po- for federal income tax purposes from the holding, RATED BUSINESS TAX REFUNDS litical subdivisions) leasing or managing of real property (including any Enter any refund or credit for the overpayment of business conducted at the property as an incidental 2) interest or dividend income on bonds or se- any income tax to the extent included in comput- service to tenants) if such holding, leasing or man- curities, held in connection with the business, ing part 1, line 10. aging of property is not subject to Unincorporated of any United States authority, commission Business Tax under NYC Administrative Code Sec- or instrumentality that the laws of the United LINE 18 - FEDERAL EMPLOYMENT tion 11-502(d) (Refer to “Who is Subject to the States exempt from federal income tax but CREDIT Tax”, paragraph 6.) not from state or local income taxes Enter the portion of wages and salaries paid or incurred for the taxable year for which a deduc- Subtract income or gain includible in gross in- Instructions for Form NYC-204 - 2020 Page 10 come for federal income tax purposes, including reported for each property if the deductible by a corporation are the same as those dividends, interest, income attributable to secu- adjusted basis of the property on for individuals, except that: rities loans, notional principal contracts, the the date of sale or other disposi- 1) contributions to fraternal societies, orders holding, sale, disposition, assumption, offset or tion had been either: and associations operating under the lodge termination of a position in property as defined A) its fair market value on Janu- system are not deductible, and in Admin. Code §11-502(2) (1) (A), or other sub- ary 1, 1966, or on the date of stantially similar income from ordinary and rou- its sale or disposition prior to 2) contributions to a trust, chest, fund or foundation tine trading or investment activity as determined January 1, 1966, plus or are deductible only if they are to be used within by the Commissioner, realized in connection with minus all federal adjustments the United States or its possessions. certain investment activities to the extent such to basis for the period after activities are considered exempt from the Unin- LINE 29 - INVESTMENT INCOME December 31, 1965, or corporated Business Tax. (Refer to: “Who is Investment income includes: 50% of dividends B) the amount realized from its Subject to the Tax”, paragraph 5.) from stocks held for investment; interest from in- sale or other disposition, vestment capital; net capital gain or loss from In the case of a taxpayer that qualifies for the par- whichever is lower. sales or exchanges of securities held for invest- tial investment exemption (see: “Who is Subject ment; and income from cash if an election is made If a gain reported is from a sale of to the Tax”, paragraph 5), subtract income or to treat cash as investment capital on line 3 of property prior to January 1, 1966, gain includible in gross income for federal income Schedule D. Do not include any capital loss that reported on the installment tax purposes realized from the sale or other dis- could not be used in computing federal taxable in- method, the fair market value of position of an interest in another unincorporated come. entity to the extent attributable to activities of that the property on the date of the sale entity covered by the taxpayer’s partial exemp- must be substituted for its fair mar- In computing investment income, subtract the amount tion. ket value on January 1, 1966. The of deductions allowable in computing entire net in- total adjustment may not exceed come which are directly or indirectly attributable to LINE 23 - OTHER SUBTRACTIONS the taxpayer’s net gain from the investment capital or investment income. If you have received a distributive share of busi- sale or other disposition of all the ness or investment income or gains from any property. LINE 29a - DIVIDENDS FROM STOCKS partnership, other than a utility partnership as de- HELD FOR INVESTMENT 2) interest on money borrowed to purchase or scribed below, subtract here any distributive Enter dividends not excluded on line 21. This in- carry bonds or securities, the interest on share amounts of such income or gains included cludes 50% of dividends from corporations for which is subject to the Unincorporated Busi- in calculating the amount on line 12 of this which an exclusion was allowed on line 21 of this ness Tax but exempt from federal income tax; schedule and not previously subtracted on line schedule and 100% of dividends from stock not ordinary and necessary expenses paid or in- 11. NOTE: A corresponding addback may have meeting the holding period requirement set forth curred during the taxable year in connection to be made on Schedule A, line 3b or 7b. See in- in Section 246(c) of the IRC. with income or property held for the produc- structions for those lines. tion of this income; and amortization of bond LINE 29d - INCOME FROM CASH Utility Partnerships. For tax years beginning on premium for the taxable year on any bond, the Enter income from cash on Schedule B, line 29d or after August 1, 2002, partnerships that are part- interest on which is subject to the Unincorpo- only if you have elected to treat cash as investment ners in partnerships that are subject to tax under rated Business Tax but exempt from federal capital and have entered the amount thereof on Ad. Code Title 11, Ch. 11 as “utilities” defined in income tax, to the extent these items were not Schedule D, line 3. deducted in computing part 1, line 12. Ad. Code section 11-1101(6) should subtract here any distributive share of income or gains from any 3) any other subtractions required by Sections LINE 29f - DEDUCTIONS ATTRIBUTABLE such partnership, including their share of sepa- 11-506 and 11-507 (other than charitable TO INVESTMENT INCOME rately reported items included in calculating the contributions) of the NYC Administrative For more information, see Statement of Audit Pro- amount on line 1 of this schedule. There is no cor- Code. (Attach any appropriate schedules.) cedure GCT-2008-04, Noninterest Expense Attri- responding addback on Schedule A for these bution, April 9, 2008 and Statement of Audit amounts. Do not include on line 23 any net operating loss Procedure PP-2008-12, GCT & UBT Treatment of

carryover. Any unincorporated business net op- Repurchase Agreements and Securities Lending Describe in a separate schedule the nature and erating loss deduction allowable in 2020 by rea- and Borrowing Transactions for Financial Services amount of any subtractions, such as: son of a carryover of a net operating loss Firms Regularly Engaged in Such Activities, 1) the portion of gain included in computing sustained by the partnership in prior years should March 31, 2008, available on the Department’s part 1, line 12, from the sale or other dispo- be reported on Form NYC-NOLD-UBTP and on website at nyc.gov/finance. sition of property acquired before January Schedule A.

1, 1966, except: SCHEDULE C SAFE HARBOR LEASES Partnership Information a) stock in trade of the taxpayer or other This applies to agreements entered into prior to Jan- Partnerships must complete this schedule in order property of a kind that would be prop- uary 1, 1984. The NYC Administrative Code was to claim the allowance for partner’s services erly included in his inventory if on amended to nullify the effects of federal “Safe Har- (Schedule A, line 13). In addition, this schedule hand at the close of the taxable year, or bor Leases” upon New York City unincorporated must be completed for partners to claim the UBT property held by the taxpayer primarily business taxable income. (Refer to Sections 11-506 Paid Credit on their own respective Unincorpo- for sale to customers in the ordinary and 11-507 of the NYC Administrative Code for de- rated Business, General Corporation, Banking course of his trade or business; and tails.) Corporation or Business Corporation Tax returns b) accounts or notes receivable acquired in or a credit for UBT paid on their own City resi- the ordinary course of the trade or busi- LINE 27 - CHARITABLE dent PIT return. ness for services rendered or from the CONTRIBUTIONS sale of property described in a) to the Deductions are allowed for charitable contribu- Enter for each partner in column H the sum of that tions made by the partnership, as a tax entity sep- extent of the difference between: partner’s distributive share of income, gain, loss and arate and distinct from its partners, to the extent i) the amount of gain reported for deductions of the partnership, and guaranteed pay- contributions would be deductible by a corpora- ments from the partnership, but only if the sum is each property; and tion for federal income tax purposes, but not in greater than or equal to zero (i.e., the partner’s in- ii) the amount of gain that would be excess of 5% of line 26. In general, contributions Instructions for Form NYC-204 - 2020 Page 11 come, gain, and guaranteed payments exceed the Investment capital is the average value of your in- SCHEDULE E partner’s losses and deductions). For this purpose, vestments in stocks, bonds, and other corporate or Business Allocation a partner’s distributive share is that partner’s dis- government securities, less liabilities, both long An allocation of business income is permitted for tributive share of each item of income, gain, loss, term and short term, directly or indirectly attrib- purposes of the Unincorporated Business Tax if and deduction, other than guaranteed payments utable to investment capital. Investment capital the partnership carries on business both inside and made by the partnership, reflected in Schedule B, does not include governmental stocks, bonds and outside New York City. For tax years beginning line 28, plus the amount of any guaranteed payments other securities, the interest and dividends from on or after January 1, 2012, all taxpayers must al- to that partner from the partnership. If the sum is which are totally exempt from the UBT except locate unincorporated business taxable income less than zero (i.e., the partner’s losses and deduc- such instruments that are disposed of during the using formula allocation. See sections 11-508(b) tions exceed the partner’s income, gain, and guar- taxable year, producing taxable gain or loss. In- and (c) of the Administrative Code. Tax year anteed payments), enter “0”. vestment capital does not include those stocks, 2011 was the last taxable year in which eligible bonds or other securities that are held for sale to taxpayers who made the one-time election to con- Enter in column I each partner’s percentage share customers in the regular course of business. In- tinue using books and records allocation for tax of the total of the amounts entered in column H. Di- vestment capital does not include interests in, or year 2005 were permitted to use that method of vide the amount for the partner in column H by the obligations of, partnerships or other unincorpo- allocation. column H total. The total of the percentages in col- rated entities. umn I must add up to 100%. Allocation for Partners in Other Partnerships. To determine the value of your assets for invest- If an unincorporated entity (the "partner") is a part- ment allocation purposes, you must include mar- ner in another unincorporated entity (the "partner- SCHEDULE D ketable securities at fair market value. ship"), carrying on an unincorporated business Investment Allocation wholly or partly in New York City and either the Complete Schedule D if you directly own invest- The fair market value of any asset is the price partner or the partnership allocates a portion of its ment capital. (without any encumbrance, whether or not the unincorporated business entire net income outside taxpayer is liable) at which a willing seller, not New York City, the partner must allocate its dis- Allocation for Partners in Other Partnerships. compelled to sell, will sell and a willing pur- tributive share of the partnership's business in- If an unincorporated entity (the "partner") is a chaser, not compelled to buy, will buy. The fair come, if any, as provided below. The partner partner in another unincorporated entity (the market value, on any date, of stocks, bonds and should not report its distributive share of that part- "partnership"), carrying on an unincorporated other securities regularly dealt in on an exchange nership's business income or any of that partner- business wholly or partly in New York City, the or in the over-the-counter market is the mean be- ship's allocation factors on Schedule E. partner should not include its percentage interest tween the highest and lowest selling prices on in the items of investment capital of the partner- that date. Unless a partner is permitted or required by the ships from which it receives a distributive share Commissioner to use an alternative method, the part- in Schedule D. The partner must allocate its dis- The value of all other property must be included ner must allocate to the City the same percentage of tributive share of the partnership's investment in- at the value shown on the taxpayer’s books and its distributive share of each item of a particular part- come as provided below. See §28-07(j)(3)(i) of records in accordance with generally accepted ac- nership's business income, gain, loss and deduction Title 19 of the Rules of the City of New York for counting principles (GAAP). as the partnership allocated to the City for purposes more information. of determining its own business income allocated to ISSUER’S ALLOCATION PERCENTAGE Unless a partner is permitted or required by the the City for the partnership's taxable year ending To determine the portion of investment capital to Commissioner to use an alternative method, the with or within the partner's taxable year. The part- be allocated within the City, multiply the value of partner must allocate to the City its investment in- ner must report those amounts on lines 15 and 23 of each stock or security during the period covered come from directly owned investment capital Schedule B and line 3b of Schedule A. See instruc- by the return (column E) by the issuer’s allocation based solely by reference to its directly owned in- tions for those lines. See §28-07(j)(2)(i)(A) of Title percentage for that stock or security. vestment capital without regard to its percentage 19 the Rules of the City of New York. interest in the investment capital of any partner- This percentage may be obtained from (1) tax Discretionary use of other methods. The Commis- ship. service publications, (2) from the Department’s sioner of Finance in his or her discretion may permit website under “Forms & Publications” at Unless a partner is permitted or required by the or require a taxpayer partner to use another method or (3) by calling 311. If calling Commissioner to use an alternative method, the nyc.gov/finance to allocate its own business income and its distribu- partner must separately allocate to the City the from outside of the five NYC boroughs, please call tive share of the business income, gain, loss and de- same percentage of its distributive share of in- 212-NEW-YORK (212-639-9675). If the issuer duction of another partnership if the Commissioner vestment income from a particular partnership as was not doing business in New York City during determines that the methods provided do not result that partnership allocated to the City for purposes the preceding year, the percentage is “0”. in a fair and equitable allocation to the City of the of determining its own unincorporated business taxpayer partner's income. If a partner is permitted taxable income for the partnership's taxable year SCHEDULE D, LINE 3 - CASH or required to use a discretionary method, detailed ending with or within the partner's taxable year. If you have both business and investment capital, schedules and explanations should be attached. The partner must report those amounts on lines you may elect to treat cash on hand or on deposit as 15 and 23 of Schedule B and line 7b of Schedule either business or investment capital. If you wish to ALLOCATION BY FORMULA A. See instructions for those lines. elect to treat cash as investment capital, you must Income from business carried on both inside and include it on this line. Otherwise, you will be outside New York City must be determined in ac- Discretionary use of other methods. The Com- deemed to have elected to treat cash as business cordance with the statutory formula or an alterna- missioner of Finance in his or her discretion may capital. You may not elect to treat part of such cash tive method approved by the Department of permit or require the taxpayer to use another as business capital and part as investment capital. Finance. Schedules E, Parts 1, 2 and 3 must be method to allocate its directly owned investment You may not revoke your election after it has been completed for this purpose in accordance with the income and its distributive share of investment in- made. specific instructions below. come of another partnership if the Commissioner determines that the above methods do not result in COMPOSITION OF PREPAYMENTS A partnership that derives more than 10% of its a fair and equitable allocation to the City of the SCHEDULE gross receipts for the taxable year from publishing taxpayer's income. If a partner is permitted or re- Enter the payment date and the amount of all pre- newspapers or periodicals or radio or television quired to use a discretionary method, detailed payments made for this tax period. broadcasting must allocate all its income using the schedules and explanations should be attached. statutory formula unless the Department of Fi- Instructions for Form NYC-204 - 2020 Page 12 nance requires an alternative method to be used the place-of-performance method starting in that missions earned from the execution of securi- in order to fairly and equitably reflect the part- year. All other taxpayers must use the place-of- ties or commodities purchase or sales orders nership’s business income in the City. performance method starting with the first tax for the accounts of customers are deemed to year beginning on or after July 1, 2007. arise from a service performed in New York

ALTERNATIVE ALLOCATION METHOD City if the customer who is responsible for For taxable years beginning after June 30, 1996, In order to request a discretionary adjustment to the paying the commissions is located in New the amount to be entered on line 1, column A with statutory method of allocation, a written request, separate York City. respect to sales of tangible personal property is and apart from filing this return, must be submitted. For the portion of the total gross sales of tangible per- details on how to make such a request, go to ● Margin interest - Margin interest earned on sonal property that represents sales where ship- http://www1.nyc.gov/site/finance/taxes/business-filing- brokerage accounts is deemed to arise from a ment is made to a point within New York City. information.page service performed in New York City if the The amount to be entered on line 1 in column B is customer who is responsible for paying the If consent to use a different allocation method has the total gross sales made or charges for services margin interest is located in New York City. not been obtained at the time of the filing of the performed by the partners or by employees, return, you must use the formula basis set out in agents, agencies, or independent contractors of ● Account maintenance fees - Account main- Schedule E, and pay the tax in accordance there- the unincorporated business inside and outside tenance fees are deemed to arise from a serv- with. If the Department consents to your pro- ice performed in New York City if the New York City. posed alternative allocation method and it results customer who is responsible for paying the Partnerships engaged in publishing newspapers or in a lower tax liability than the formula basis set account maintenance fees is located in New periodicals must allocate receipts from advertis- out in Schedule E, you may be entitled to claim a York City. refund of the excess amount you have paid. ing in such publications based on the circulation of the publication in the City compared to the total ● Income from principal transactions - Gross Securities and commodities brokers should refer circulation. Partnerships engaged in radio or tel- income from principal transactions (that is, to 19 RCNY Section 28-07(h) for special rules evision broadcasting, whether by cable or other transactions in which the registered broker or for allocating commissions, manager fees, pri- means, must allocate receipts from broadcasting dealer is acting as principal for its own ac- mary spreads, and selling concessions. programs or commercial messages based upon the count, rather than as an agent for the cus- location of the audience for the broadcasts in the tomer) are deemed to arise from a service City compared to the total audience. Partnerships SCHEDULE E, PARTS 1 AND 2 performed in New York City if the production engaged in publishing newspapers or periodicals Enter the information requested in parts 1 and 2, credits for these transactions are awarded to a or in radio or television broadcasting must allo- all columns. Indicate in the “rent” column New York City branch, office, or employee of cate receipts from subscriptions to such newspa- whether you own or rent the premises listed. the taxpayer. pers, periodicals and broadcast programs based on Enter the amount of rent paid, if any. (Attach the location of the subscriber. Registered broker dealers may elect to source the rider if necessary.) gross income from principal transactions based on Receipts from management, administration or the location of the customer to the principal trans- SCHEDULE E, PART 3 - SINGLE distribution services provided to a regulated in- action. If the election is made, gross income from RECEIPTS FACTOR ALLOCATION vestment company (RIC) must be allocated principal transactions is deemed to arise from a The business allocation percentage is computed by based upon the percentage of the RIC's share- service performed in New York City to the extent dividing the amount of New York City gross in- holders domiciled in New York City. (Attach that the gross proceeds from the transactions are come by total gross income and entering the result rider showing computation.) See Admin. Code generated from sales of securities or commodities on Schedule E. Part 3, Line 2. Taxpayers who do §11-508(e-2). to customers within the city based upon the mailing not allocate business income outside New York addresses of those customers in the records of the City must enter 100% on Schedule E, Part 3, line 2. SOURCING OF RECEIPTS OF REGIS- taxpayer. For additional information, see Adminis- TERED SECURITIES OR COMMODITIES trative Code section 11-503(e-3)(1)(C) as added by LINE 1 - GROSS SALES OF BROKERS OR DEALERS. section 108 of Chapter 201 of the Laws of 2009. MERCHANDISE OR CHARGES FOR For taxable years beginning after 2008, new rules SERVICES DURING THE YEAR are applicable in determining the sourcing of the ● Fees earned from advisory services for a Except as provided in the following paragraphs, receipts of taxpayers which are registered secu- customer in connection with the under- the amount to be entered on line 1 in column A is rities or commodities brokers or dealers. See writing of securities (where the customer is the portion of the total gross sales or charges that Chapter 201 of the Laws of 2009. the entity contemplating the issuance of the represents services performed by or through an securities or is issuing securities) or for the Receipts earned by registered securities or agency in New York City. This includes services management of an underwriting of securities commodities broker or dealer - The rules below performed by employees, agents, agencies or in- are deemed to arise from a service performed apply for determining whether a receipt is dependent contractors situated at, connected with, in New York City if the customer responsible deemed to arise from services performed in New or sent out from offices of the unincorporated busi- for paying the fee is located in New York City. ness (or its agencies) located in New York City. York City by a registered securities or commodi-

ties broker or dealer, for purposes of computing ● Notwithstanding the foregoing, for tax years be- Receipts from the primary spread for the the gross income factor of the BAP (Administra- underwriting of securities - Receipts from ginning on and after July 1, 2005, the source of tive Code section 11-508(e-3)). income from services will be determined by the the primary spread or selling concession from place where the services were performed (the A registered securities or commodities broker or underwritten securities are deemed to arise “place-of-performance method”), instead of the dealer is a broker or dealer who is registered by from a service performed in New York City if office out of which the services were performed, the Securities and Exchange Commission (SEC) production credits are awarded to a branch, according to the following phase-in schedule: or the Commodities Futures Trading Commission office, or employee of the taxpayer in New Taxpayers having gross receipts of less than and includes over-the-counter (OTC) derivatives York City as a result of the sale of underwrit- $100,000 for the first tax year starting on or after dealers as defined under regulations of the SEC ten securities. July 1, 2005 and before July 1, 2006, must use (17 CFR 240.3b-12). The terms securities and ● the place-of-performance method starting in that commodities have the same meanings as the Interest earned on loans to affiliates - In- year. Taxpayers having gross receipts of less than meanings in IRC sections 475(c)(2) and terest earned on loans and advances made by $300,000 for the first tax year starting on or after 475(e)(2). a taxpayer to an affiliate are deemed to arise from a service performed in New York City if July 1, 2006 and before July 1, 2007, must use ● Brokerage commissions - Brokerage com- Instructions for Form NYC-204 - 2020 Page 13

the principal place of business of the affiliate who is responsible for the payment of interest is located in New York City. An entity shall be considered an affiliate with the taxpayer for this purpose if the entity and the taxpayer have an eighty percent or more common di- rect or indirect, actual or beneficial owner- ship.

● Fees for management or advisory services - Fees earned from management or advisory services, including fees from advisory services for activities relating to mergers or acquisition activities, are deemed to arise from a service performed in New York City if the customer responsible for paying these fees is located in New York City.

A customer is located in New York City if the mailing address of the customer, as it appears in the broker’s or dealer's records, is in New York City. For more information, see Admin- istrative Code section 11-503(e-3) as added by section 108 of Chapter 201 of the Laws of 2009.

LINE 2 – BUSINESS ALLOCATION PER- CENTAGE Divide line 1, column A by line 1, column B. Round to the nearest hundredth of a percent.

SCHEDULE G

Additional Required Information All questions in this schedule must be answered.

For interest calculations and account information, call 311. If calling from outside of the five NYC boroughs, please call 212-NEW-YORK (212-639- 9675).

You can also visit the Finance website at: nyc.gov/finance

PRIVACY ACT NOTIFICATION The Federal Privacy Act of 1974, as amended, re- quires agencies requesting Social Security Num- bers to inform individuals from whom they seek this information as to whether compliance with the request is voluntary or mandatory, why the request is being made and how the information will be used. The disclosure of Social Security Numbers for taxpayers is mandatory and is required by sec- tion 11-102.1 of the Administrative Code of the City of New York. Such numbers disclosed on any report or return are requested for tax administra- tion purposes and will be used to facilitate the pro- cessing of tax returns and to establish and maintain a uniform system for identifying taxpayers who are or may be subject to taxes administered and col- lected by the Department of Finance, and, as may be required by law, or when the taxpayer gives written authorization to the Department of Finance for another department, person, agency or entity to have access (limited or otherwise) to the informa- tion contained in his or her return.

NYC-204 Instructions - 2020