S corporation which underwent a federal tax exempt reorganization under IRC section 368(1)(a)(F) (an F Reorganization) should file its General Corporation Tax return for the entire tax year covering both the period before and after the F Reorganization. No short period returns should be filed. In the F Reorganization , the shareholders of the old subchapter S corporation contributed their shares in the old corporation to a new subchapter S corporation with the old subchapter S corporation becoming a qualified subchapter S subsidiary (a Q-Sub) of the new subchapter S corporation; the Q-Sub then merged into an LLC wholly owned by the new subchapter S corporation and disregarded for tax purposes, with that LLC being the surviving entity. Hence, before the F reorganization, the old subchapter S corporation owned its assets directly; after the F reorganization, the new subchapter S corporation wholly owned an LLC which in turn owned the old subchapter S corporation's assets. #15-4966 6/3/15
Sale of two cooperative apartments that had been used as a single residential dwelling for over 40 years, and that the purchasers, with board approval using a proposal obtained from an architect, intend to physically combine, should be treated as the sale of a single cooperative apartment subject to the lower tax rate schedule under Code section 11-2102(b)(1)(B)(i). #16-4977 6/9/16
Sale of a one family home with one office, categorized as tax Class 1 to reflect that the Property is used primarily for residential purposes, and having a building Code S1 (primarily 1 family with 1 store or office) consistent with the tax classification is taxed at a reduced rate of 1.425 percent when calculating the RPTT due upon the conveyance of the Property. In the absence of information suggesting the Department's classification of the Property as Class 1 is incorrect, that classification is controlling for RPTT purposes. #15-4975 5/13/16