There is a newer version of the New York Consolidated Laws
2012 New York Consolidated Laws
TAX - Tax
Article 32 - (1450 - 1468) Franchise Tax on Banking Corporations
1452 - Banking corporation defined; exempt corporations.
NY Tax L § 1452 (2012) What's This?
§ 1452. Banking corporation defined; exempt corporations. (a) For the
purpose of this article, a banking corporation means:
(1) Every corporation or association organized under the laws of this
state which is authorized to do a banking business, or which is doing a
banking business;
(2) every corporation or association organized under the laws of any
other state or country which is doing a banking business;
(3) every national banking association organized under the authority
of the United States which is doing a banking business;
(4) every federal savings bank which is doing a banking business;
(5) every federal savings and loan association which is doing a
banking business;
(6) a production credit association organized under the federal farm
credit act of nineteen hundred thirty-three, which is doing a banking
business and all of whose stock held by the federal production credit
corporation has been retired;
(7) every other corporation or association organized under the
authority of the United States which is doing a banking business;
(8) the mortgage facilities corporation created by chapter five
hundred sixty-four of the laws of nineteen hundred fifty-six;
(9) any corporation sixty-five percent or more of whose voting stock
is owned or controlled, directly or indirectly, by a corporation or
corporations subject to article three-a of the banking law, or
registered under the federal bank holding company act of nineteen
hundred fifty-six, as amended, or registered as a savings and loan
holding company (but excluding a diversified savings and loan holding
company) under the federal national housing act, as amended, or by a
corporation or corporations described in any of the foregoing paragraphs
of this subsection, provided the corporation whose voting stock is so
owned or controlled is principally engaged in a business, regardless of
where conducted, which (i) might be lawfully conducted by a corporation
subject to article three of the banking law or by a national banking
association, or (ii) is so closely related to banking or managing or
controlling banks as to be a proper incident thereto, as set forth in
paragraph eight of subsection (c) or subparagraph (F) of paragraph four
of subsection (k) of section four of the federal bank holding company
act of nineteen hundred fifty-six, as amended, or (iii) holds and
manages investment assets, including but not limited to bonds, notes,
debentures and other obligations for the payment of money, stocks,
partnership interests or other equity interests, and other investment
securities and which is not a business described in subparagraph (i) or
(ii) of this paragraph; and provided, further, that in no event shall a
corporation principally engaged in a business described in section one
hundred eighty-three or one hundred eighty-four, or section one hundred
eighty-six as it was in effect on December thirty-first, nineteen
hundred ninety-nine, of this chapter be subject to the tax imposed under
this article if any of its business receipts from such principally
engaged in business are from other than a corporation (A) which owns or
controls, directly or indirectly, sixty-five percent or more of its
voting stock, or (B) sixty-five percent or more of whose voting stock is
owned or controlled, directly or indirectly, by the corporation engaged
in such business, or (C) sixty-five percent or more of whose voting
stock is owned or controlled, directly or indirectly, by the same
interest.
(b) Banking business defined. The words "banking business" as used in
this section mean such business as a corporation or association may be
created to do under article three, three-B, five, five-A, five-C, six or
ten of the banking law or any business which a corporation or
association is authorized by such article to do. However, with respect
to a national banking association organized under the authority of the
United States, a federal savings bank, a federal savings and loan
association or a production credit association, the words "banking
business" as used in this section mean such business as a national
banking association, federal savings bank, federal savings and loan
association or production credit association, respectively, may be
created to do or is authorized to do under the laws of the United States
or this state. The words "banking business" as used in this section
shall also mean such business as any corporation or association
organized under the authority of the United States or organized under
the laws of any other state or country has authority to do which is
substantially similar to the business which a corporation or association
may be created to do under article three, three-B, five, five-A, five-C,
six or ten of the banking law or any business which a corporation or
association is authorized by such article to do.
(c) Exempt corporations. A trust company all of whose capital stock is
owned by twenty or more savings banks organized under New York law shall
be exempt from the tax under this article.
(d) Corporations taxable under article nine-A. Notwithstanding the
provisions of this article, all corporations of classes now or
heretofore taxable under article nine-A of this chapter shall continue
to be taxable under article nine-A, except: (1) corporations organized
under article five-A of the banking law; (2) corporations subject to
article three-A of the banking law, or registered under the federal bank
holding company act of nineteen hundred fifty-six, as amended, or
registered as a savings and loan holding company (but excluding a
diversified savings and loan holding company) under the federal national
housing act, as amended, which make a combined return under the
provisions of subsection (f) of section fourteen hundred sixty-two; (3)
banking corporations described in paragraph nine of subsection (a) of
this section; (4) any captive REIT or captive RIC that is required to be
included in a combined return under the provisions of subsection (f) of
section fourteen hundred sixty-two of this article; and (5) any
overcapitalized captive insurance company required to be included in a
combined return under subsection (f) of section fourteen hundred
sixty-two of this article. Provided, however, that a corporation
described in paragraph three of this subsection which was subject to the
tax imposed by article nine-A of this chapter for its taxable year
ending during nineteen hundred eighty-four may, on or before the due
date for filing its return (determined with regard to extensions) for
its taxable year ending during nineteen hundred eighty-five, make a one
time election to continue to be taxable under such article nine-A. Such
election shall continue to be in effect until revoked by the taxpayer.
In no event shall such election or revocation be for a part of a taxable
year.
(e) Corporations taxable under article thirty-three. Except for
corporations described in subsection (1) of section fourteen hundred
fifty-three, corporations liable to tax under article thirty-three shall
not be subject to tax under this article.
(f) For exemption from tax of a qualified subchapter S subsidiary, see
subsection (o) of section fourteen hundred fifty-three of this article.
(g) A banking corporation organized under the laws of a country, or
any political subdivision thereof, other than the United States shall
not be deemed to be doing business in this state under this article if
its activities in this state are limited solely to (1) investing or
trading in stocks and securities for its own account within the meaning
of clause (ii) of subparagraph (A) of paragraph (2) of subsection (b) of
section eight hundred sixty-four of the internal revenue code or (2)
investing or trading in commodities for its own account within the
meaning of clause (ii) of subparagraph (B) of paragraph (2) of
subsection (b) of section eight hundred sixty-four of the internal
revenue code or (3) any combination of activities described in
paragraphs one and two of this subsection.
(h) Transitional provisions relating to the enactment and
implementation of the federal Gramm-Leach-Bliley act. (1)
Notwithstanding anything to the contrary contained in this section other
than subsection (n) of this section, a corporation that was in existence
before January first, two thousand and was subject to tax under article
nine-A of this chapter for its last taxable year beginning before
January first, two thousand, shall continue to be taxable under article
nine-A for all taxable years beginning on or after January first, two
thousand and before January first, two thousand one. The preceding
sentence shall not apply to any taxable year during which such
corporation is a banking corporation described in paragraphs one through
eight of subsection (a) of this section. Notwithstanding anything to the
contrary contained in this section other than subsection (n) of this
section, a banking corporation that was in existence before January
first, two thousand and was subject to tax under this article for its
last taxable year beginning before January first, two thousand, shall
continue to be taxable under this article for all taxable years
beginning on or after January first, two thousand and before January
first, two thousand one. Provided, however, that nothing in this
subsection shall prohibit a corporation that elected pursuant to
subsection (d) of this section to be taxable under article nine-A of
this chapter from revoking that election in accordance with such
subsection (d).
For purposes of this paragraph, a corporation shall be considered to
be subject to tax under article nine-A of this chapter for a taxable
year if such corporation was not a taxpayer but was properly included in
a combined report filed pursuant to section two hundred eleven of this
chapter for such taxable year and a corporation shall be considered to
be subject to tax under this article for a taxable year if such
corporation was not a taxpayer but was properly included in a combined
return filed pursuant to subsection (f) or (g) of section fourteen
hundred sixty-two of this article for such taxable year. A corporation
that was in existence before January first, two thousand but first
becomes a taxpayer in a taxable year beginning on or after January
first, two thousand and before January first, two thousand one, shall be
considered for purposes of this paragraph to have been subject to tax
under article nine-A of this chapter for its last taxable year beginning
before January first, two thousand if such corporation would have been
subject to tax under such article for such taxable year if it had been a
taxpayer during such taxable year. A corporation that was in existence
before January first, two thousand but first becomes a taxpayer in a
taxable year beginning on or after January first, two thousand and
before January first, two thousand one, shall be considered for purposes
of this paragraph to have been subject to tax under this article for its
last taxable year beginning before January first, two thousand if such
corporation would have been subject to tax under this article for such
taxable year if it had been a taxpayer during such taxable year.
(2) Notwithstanding anything to the contrary contained in this section
other than subsection (n) of this section, a corporation formed on or
after January first, two thousand and before January first, two thousand
one may elect to be subject to tax under this article or under article
nine-A of this chapter for its first taxable year beginning on or after
January first, two thousand and before January first, two thousand one
in which either (i) sixty-five percent or more of its voting stock is
owned or controlled, directly or indirectly by a financial holding
company, provided the corporation whose voting stock is so owned or
controlled is principally engaged in activities that are described in
section 4(k)(4) or 4(k)(5) of the federal bank holding company act of
nineteen hundred fifty-six, as amended and the regulations promulgated
pursuant to the authority of such section, or (ii) it is a financial
subsidiary. An election under this paragraph may not be made by a
corporation described in paragraphs one through eight of subsection (a)
of this section or in subsection (e) of this section. In addition, an
election under this paragraph may not be made by a corporation that is a
party to a reorganization, as defined in subsection (a) of section 368
of the internal revenue code of 1986, as amended, of a corporation
described in paragraph one of this subsection if both corporations were
sixty-five percent or more owned or controlled, directly or indirectly,
by the same interests at the time of the reorganization.
An election under this paragraph must be made by the taxpayer on or
before the due date for filing its return (determined with regard to
extensions of time for filing) for the applicable taxable year. The
election to be taxed under article nine-A of this chapter shall be made
by the taxpayer by filing the report required pursuant to section two
hundred eleven of this chapter and the election to be taxed under this
article shall be made by the taxpayer by filing the return required
pursuant to section fourteen hundred sixty-two of this article. Any
election made pursuant to this paragraph shall be irrevocable and shall
apply to each subsequent taxable year beginning on or after January
first, two thousand and before January first, two thousand one, provided
that the stock ownership requirements described in subparagraph (i) of
this paragraph are met or such corporation described in subparagraph
(ii) of this paragraph continues as a financial subsidiary.
(3) For purposes of this section, a financial subsidiary means a
corporation (i) sixty-five percent or more of whose voting stock is
owned or controlled, directly or indirectly by a banking corporation
described in paragraph one, two or three of subsection (a) of this
section and (ii) is described in section 5136A(g) of the revised
statutes of the United States or section 46 of the federal deposit
insurance act. For purposes of this article, the term "banking
corporation" shall include a corporation electing to be taxed under this
article pursuant to paragraph two of this subsection for so long as such
election shall be in effect.
(i) Transitional provisions relating to the enactment and
implementation of the federal Gramm-Leach-Bliley act. (1)
Notwithstanding anything to the contrary contained in this section other
than subsection (n) of this section, a corporation that was in existence
before January first, two thousand one and was subject to tax under
article nine-A of this chapter for its last taxable year beginning
before January first, two thousand one, shall continue to be taxable
under article nine-A for all taxable years beginning on or after January
first, two thousand one and before January first, two thousand three.
The preceding sentence shall not apply to any taxable year during which
such corporation is a banking corporation described in paragraphs one
through eight of subsection (a) of this section. Notwithstanding
anything to the contrary contained in this section other than subsection
(n) of this section, a banking corporation that was in existence before
January first, two thousand one and was subject to tax under this
article for its last taxable year beginning before January first, two
thousand one, shall continue to be taxable under this article for all
taxable years beginning on or after January first, two thousand one and
before January first, two thousand three. Provided, however, that
nothing in this subsection shall prohibit a corporation that elected
pursuant to subsection (d) of this section to be taxable under article
nine-A of this chapter from revoking that election in accordance with
such subsection (d).
For purposes of this paragraph, a corporation shall be considered to
be subject to tax under article nine-A of this chapter for a taxable
year if such corporation was not a taxpayer but was properly included in
a combined report filed pursuant to section two hundred eleven of this
chapter for such taxable year and a corporation shall be considered to
be subject to tax under this article for a taxable year if such
corporation was not a taxpayer but was properly included in a combined
return filed pursuant to subsection (f) or (g) of section fourteen
hundred sixty-two of this article for such taxable year. A corporation
that was in existence before January first, two thousand one but first
becomes a taxpayer in a taxable year beginning on or after January
first, two thousand one and before January first, two thousand three,
shall be considered for purposes of this paragraph to have been subject
to tax under article nine-A of this chapter for its last taxable year
beginning before January first, two thousand one if such corporation
would have been subject to tax under such article for such taxable year
if it had been a taxpayer during such taxable year. A corporation that
was in existence before January first, two thousand one but first
becomes a taxpayer in a taxable year beginning on or after January
first, two thousand one and before January first, two thousand three,
shall be considered for purposes of this paragraph to have been subject
to tax under this article for its last taxable year beginning before
January first, two thousand one if such corporation would have been
subject to tax under this article for such taxable year if it had been a
taxpayer during such taxable year.
(2) Notwithstanding anything to the contrary contained in this section
other than subsection (n) of this section, a corporation formed on or
after January first, two thousand one and before January first, two
thousand three may elect to be subject to tax under this article or
under article nine-A of this chapter for its first taxable year
beginning on or after January first, two thousand one and before January
first, two thousand three in which either (i) sixty-five percent or more
of its voting stock is owned or controlled, directly or indirectly by a
financial holding company, provided the corporation whose voting stock
is so owned or controlled is principally engaged in activities that are
described in section 4(k)(4) or 4(k)(5) of the federal bank holding
company act of nineteen hundred fifty-six, as amended and the
regulations promulgated pursuant to the authority of such section, or
(ii) it is a financial subsidiary.
An election under this paragraph may not be made by a corporation
described in paragraphs one through eight of subsection (a) of this
section or in subsection (e) of this section. In addition, an election
under this paragraph may not be made by a corporation that is a party to
a reorganization, as defined in subsection (a) of section 368 of the
internal revenue code of 1986, as amended, of a corporation described in
paragraph one of this subsection if both corporations were sixty-five
percent or more owned or controlled, directly or indirectly, by the same
interests at the time of the reorganization. An election under this
paragraph must be made by the taxpayer on or before the due date for
filing its return (determined with regard to extensions of time for
filing) for the applicable taxable year. The election to be taxed under
article nine-A of this chapter shall be made by the taxpayer by filing
the report required pursuant to section two hundred eleven of this
chapter and the election to be taxed under this article shall be made by
the taxpayer by filing the return required pursuant to section fourteen
hundred sixty-two of this article. Any election made pursuant to this
paragraph shall be irrevocable and shall apply to each subsequent
taxable year beginning on or after January first, two thousand one and
before January first, two thousand three, provided that the stock
ownership requirements described in subparagraph (i) of this paragraph
are met or such corporation described in subparagraph (ii) of this
paragraph continues as a financial subsidiary.
(3) For purposes of this section, a financial subsidiary means a
corporation (i) sixty-five percent or more of whose voting stock is
owned or controlled, directly or indirectly by a banking corporation
described in paragraph one, two or three of subsection (a) of this
section and (ii) is described in section 5136A(g) of the revised
statutes of the United States or section 46 of the federal deposit
insurance act. For purposes of this article, the term "banking
corporation" shall include a corporation electing to be taxed under this
article pursuant to paragraph two of this subsection for so long as such
election shall be in effect.
(j) Transitional provisions relating to the enactment and
implementation of the federal Gramm-Leach-Bliley act. (1)
Notwithstanding anything to the contrary contained in this section other
than subsection (n) of this section, a corporation that was in existence
before January first, two thousand three and was subject to tax under
article nine-A of this chapter for its last taxable year beginning
before January first, two thousand three, shall continue to be taxable
under article nine-A for all taxable years beginning on or after January
first, two thousand three and before January first, two thousand four.
The preceding sentence shall not apply to any taxable year during which
such corporation is a banking corporation described in paragraphs one
through eight of subsection (a) of this section. Notwithstanding
anything to the contrary contained in this section other than subsection
(n) of this section, a banking corporation that was in existence before
January first, two thousand three and was subject to tax under this
article for its last taxable year beginning before January first, two
thousand three, shall continue to be taxable under this article for all
taxable years beginning on or after January first, two thousand three
and before January first, two thousand four. Provided, however, that
nothing in this subsection shall prohibit a corporation that elected
pursuant to subsection (d) of this section to be taxable under article
nine-A of this chapter from revoking that election in accordance with
such subsection (d).
For purposes of this paragraph, a corporation shall be considered to
be subject to tax under article nine-A of this chapter for a taxable
year if such corporation was not a taxpayer but was properly included in
a combined report filed pursuant to section two hundred eleven of this
chapter for such taxable year and a corporation shall be considered to
be subject to tax under this article for a taxable year if such
corporation was not a taxpayer but was properly included in a combined
return filed pursuant to subsection (f) or (g) of section fourteen
hundred sixty-two of this article for such taxable year. A corporation
that was in existence before January first, two thousand three but first
becomes a taxpayer in a taxable year beginning on or after January
first, two thousand three and before January first, two thousand four,
shall be considered for purposes of this paragraph to have been subject
to tax under article nine-A of this chapter for its last taxable year
beginning before January first, two thousand three if such corporation
would have been subject to tax under such article for such taxable year
if it had been a taxpayer during such taxable year. A corporation that
was in existence before January first, two thousand three but first
becomes a taxpayer in a taxable year beginning on or after January
first, two thousand three and before January first, two thousand four,
shall be considered for purposes of this paragraph to have been subject
to tax under this article for its last taxable year beginning before
January first, two thousand three if such corporation would have been
subject to tax under this article for such taxable year if it had been a
taxpayer during such taxable year.
(2) Notwithstanding anything to the contrary contained in this section
other than subsection (n) of this section, a corporation formed on or
after January first, two thousand three and before January first, two
thousand four may elect to be subject to tax under this article or under
article nine-A of this chapter for its first taxable year beginning on
or after January first, two thousand three and before January first, two
thousand four in which either (i) sixty-five percent or more of its
voting stock is owned or controlled, directly or indirectly by a
financial holding company, provided the corporation whose voting stock
is so owned or controlled is principally engaged in activities that are
described in section 4(k)(4) or 4(k)(5) of the federal bank holding
company act of nineteen hundred fifty-six, as amended and the
regulations promulgated pursuant to the authority of such section, or
(ii) it is a financial subsidiary.
An election under this paragraph may not be made by a corporation
described in paragraphs one through eight of subsection (a) of this
section or in subsection (e) of this section. In addition, an election
under this paragraph may not be made by a corporation that is a party to
a reorganization, as defined in subsection (a) of section 368 of the
internal revenue code of 1986, as amended, of a corporation described in
paragraph one of this subsection if both corporations were sixty-five
percent or more owned or controlled, directly or indirectly, by the same
interests at the time of the reorganization. An election under this
paragraph must be made by the taxpayer on or before the due date for
filing its return (determined with regard to extensions of time for
filing) for the applicable taxable year. The election to be taxed under
article nine-A of this chapter shall be made by the taxpayer by filing
the report required pursuant to section two hundred eleven of this
chapter and the election to be taxed under this article shall be made by
the taxpayer by filing the return required pursuant to section fourteen
hundred sixty-two of this article. Any election made pursuant to this
paragraph shall be irrevocable and shall apply to each subsequent
taxable year beginning on or after January first, two thousand three and
before January first, two thousand four, provided that the stock
ownership requirements described in subparagraph (i) of this paragraph
are met or such corporation described in subparagraph (ii) of this
paragraph continues as a financial subsidiary.
(3) For purposes of this section, a financial subsidiary means a
corporation (i) sixty-five percent or more of whose voting stock is
owned or controlled, directly or indirectly by a banking corporation
described in paragraph one, two or three of subsection (a) of this
section and (ii) is described in section 5136A(g) of the revised
statutes of the United States or section 46 of the federal deposit
insurance act. For purposes of this article, the term "banking
corporation" shall include a corporation electing to be taxed under this
article pursuant to paragraph two of this subsection for so long as such
election shall be in effect.
(k) Transitional provisions relating to the enactment and
implementation of the federal Gramm-Leach-Bliley act. (1)
Notwithstanding anything to the contrary contained in this section other
than subsection (n) of this section, a corporation that was in existence
before January first, two thousand four and was subject to tax under
article nine-A of this chapter for its last taxable year beginning
before January first, two thousand four, shall continue to be taxable
under article nine-A for all taxable years beginning on or after January
first, two thousand four and before January first, two thousand six. The
preceding sentence shall not apply to any taxable year during which such
corporation is a banking corporation described in paragraphs one through
eight of subsection (a) of this section. Notwithstanding anything to the
contrary contained in this section other than subsection (n) of this
section, a banking corporation that was in existence before January
first, two thousand four and was subject to tax under this article for
its last taxable year beginning before January first, two thousand four,
shall continue to be taxable under this article for all taxable years
beginning on or after January first, two thousand four and before
January first, two thousand six. Provided, however, that nothing in this
subsection shall prohibit a corporation that elected pursuant to
subsection (d) of this section to be taxable under article nine-A of
this chapter from revoking that election in accordance with such
subsection (d).
For purposes of this paragraph, a corporation shall be considered to
be subject to tax under article nine-A of this chapter for a taxable
year if such corporation was not a taxpayer but was properly included in
a combined report filed pursuant to section two hundred eleven of this
chapter for such taxable year and a corporation shall be considered to
be subject to tax under this article for a taxable year if such
corporation was not a taxpayer but was properly included in a combined
return filed pursuant to subsection (f) or (g) of section fourteen
hundred sixty-two of this article for such taxable year. A corporation
that was in existence before January first, two thousand four but first
becomes a taxpayer in a taxable year beginning on or after January
first, two thousand four and before January first, two thousand six,
shall be considered for purposes of this paragraph to have been subject
to tax under article nine-A of this chapter for its last taxable year
beginning before January first, two thousand four, if such corporation
would have been subject to tax under such article for such taxable year
if it had been a taxpayer during such taxable year. A corporation that
was in existence before January first, two thousand four, but first
becomes a taxpayer in a taxable year beginning on or after January
first, two thousand four and before January first, two thousand six,
shall be considered for purposes of this paragraph to have been subject
to tax under this article for its last taxable year beginning before
January first, two thousand four if such corporation would have been
subject to tax under this article for such taxable year if it had been a
taxpayer during such taxable year.
(2) Notwithstanding anything to the contrary contained in this section
other than subsection (n) of this section, a corporation formed on or
after January first, two thousand four and before January first, two
thousand six may elect to be subject to tax under this article or under
article nine-A of this chapter for its first taxable year beginning on
or after January first, two thousand four and before January first, two
thousand six in which either (i) sixty-five percent or more of its
voting stock is owned or controlled, directly or indirectly by a
financial holding company, provided the corporation whose voting stock
is so owned or controlled is principally engaged in activities that are
described in section 4(k)(4) or 4(k)(5) of the federal bank holding
company act of nineteen hundred fifty-six, as amended and the
regulations promulgated pursuant to the authority of such section, or
(ii) it is a financial subsidiary.
An election under this paragraph may not be made by a corporation
described in paragraphs one through eight of subsection (a) of this
section or in subsection (e) of this section. In addition, an election
under this paragraph may not be made by a corporation that is a party to
a reorganization, as defined in subsection (a) of section three hundred
sixty-eight of the internal revenue code of nineteen eighty-six, as
amended, of a corporation described in paragraph one of this subsection
if both corporations were sixty-five percent or more owned or
controlled, directly or indirectly, by the same interests at the time of
the reorganization. An election under this paragraph must be made by the
taxpayer on or before the due date for filing its return (determined
with regard to extensions of time for filing) for the applicable taxable
year. The election to be taxed under article nine-A of this chapter
shall be made by the taxpayer by filing the report required pursuant to
section two hundred eleven of this chapter and the election to be taxed
under this article shall be made by the taxpayer by filing the return
required pursuant to section fourteen hundred sixty-two of this article.
Any election made pursuant to this paragraph shall be irrevocable and
shall apply to each subsequent taxable year beginning on or after
January first, two thousand four and before January first, two thousand
six, provided that the stock ownership requirements described in
subparagraph (i) of this paragraph are met or such corporation described
in subparagraph (ii) of this paragraph continues as a financial
subsidiary.
(3) For purposes of this section, a financial subsidiary means a
corporation (i) sixty-five percent or more of whose voting stock is
owned or controlled, directly or indirectly by a banking corporation
described in paragraph one, two or three of subsection (a) of this
section and (ii) is described in section 5136A(g) of the revised
statutes of the United States or section forty-six of the federal
deposit insurance act. For purposes of this article, the term "banking
corporation" shall include a corporation electing to be taxed under this
article pursuant to paragraph two of this subsection for so long as such
election shall be in effect.
(l) Transitional provisions relating to the enactment and
implementation of the federal Gramm-Leach-Bliley act. (1)
Notwithstanding anything to the contrary contained in this section other
than subsection (n) of this section, a corporation that was in existence
before January first, two thousand six and was subject to tax under
article nine-A of this chapter for its last taxable year beginning
before January first, two thousand six, shall continue to be taxable
under article nine-A for all taxable years beginning on or after January
first, two thousand six and before January first, two thousand eight.
The preceding sentence shall not apply to any taxable year during which
such corporation is a banking corporation described in paragraphs one
through eight of subsection (a) of this section. Notwithstanding
anything to the contrary contained in this section other than subsection
(n) of this section, a banking corporation that was in existence before
January first, two thousand six and was subject to tax under this
article for its last taxable year beginning before January first, two
thousand six, shall continue to be taxable under this article for all
taxable years beginning on or after January first, two thousand six and
before January first, two thousand eight. Provided, however, that
nothing in this subsection shall prohibit a corporation that elected
pursuant to subsection (d) of this section to be taxable under article
nine-A of this chapter from revoking that election in accordance with
such subsection (d).
For purposes of this paragraph, a corporation shall be considered to
be subject to tax under article nine-A of this chapter for a taxable
year if such corporation was not a taxpayer but was properly included in
a combined report filed pursuant to section two hundred eleven of this
chapter for such taxable year and a corporation shall be considered to
be subject to tax under this article for a taxable year if such
corporation was not a taxpayer but was properly included in a combined
return filed pursuant to subsection (f) or (g) of section fourteen
hundred sixty-two of this article for such taxable year. A corporation
that was in existence before January first, two thousand six but first
becomes a taxpayer in a taxable year beginning on or after January
first, two thousand six and before January first, two thousand eight,
shall be considered for purposes of this paragraph to have been subject
to tax under article nine-A of this chapter for its last taxable year
beginning before January first, two thousand six if such corporation
would have been subject to tax under such article for such taxable year
if it had been a taxpayer during such taxable year. A corporation that
was in existence before January first, two thousand six but first
becomes a taxpayer in a taxable year beginning on or after January
first, two thousand six and before January first, two thousand eight,
shall be considered for purposes of this paragraph to have been subject
to tax under this article for its last taxable year beginning before
January first, two thousand six if such corporation would have been
subject to tax under this article for such taxable year if it had been a
taxpayer during such taxable year.
(2) Notwithstanding anything to the contrary contained in this section
other than subsection (n) of this section, a corporation formed on or
after January first, two thousand six and before January first, two
thousand eight may elect to be subject to tax under this article or
under article nine-A of this chapter for its first taxable year
beginning on or after January first, two thousand six and before January
first, two thousand eight in which either (i) sixty-five percent or more
of its voting stock is owned or controlled, directly or indirectly by a
financial holding company, provided the corporation whose voting stock
is so owned or controlled is principally engaged in activities that are
described in section 4(k)(4) or 4(k)(5) of the federal bank holding
company act of nineteen hundred fifty-six, as amended and the
regulations promulgated pursuant to the authority of such section, or
(ii) it is a financial subsidiary. An election under this paragraph may
not be made by a corporation described in paragraphs one through eight
of subsection (a) of this section or in subsection (e) of this section.
In addition, an election under this paragraph may not be made by a
corporation that is a party to a reorganization, as defined in
subsection (a) of section 368 of the internal revenue code of 1986, as
amended, of a corporation described in paragraph one of this subsection
if both corporations were sixty-five percent or more owned or
controlled, directly or indirectly, by the same interests at the time of
the reorganization.
An election under this paragraph must be made by the taxpayer on or
before the due date for filing its return (determined with regard to
extensions of time for filing) for the applicable taxable year. The
election to be taxed under article nine-A of this chapter shall be made
by the taxpayer by filing the report required pursuant to section two
hundred eleven of this chapter and the election to be taxed under this
article shall be made by the taxpayer by filing the return required
pursuant to section fourteen hundred sixty-two of this article. Any
election made pursuant to this paragraph shall be irrevocable and shall
apply to each subsequent taxable year beginning on or after January
first, two thousand six and before January first, two thousand eight,
provided that the stock ownership requirements described in subparagraph
(i) of this paragraph are met or such corporation described in
subparagraph (ii) of this paragraph continues as a financial subsidiary.
(3) For purposes of this section, a financial subsidiary means a
corporation (i) sixty-five percent or more of whose voting stock is
owned or controlled, directly or indirectly by a banking corporation
described in paragraph one, two or three of subsection (a) of this
section and (ii) is described in section 5136A(g) of the revised
statutes of the United States or section 46 of the federal deposit
insurance act. For purposes of this article, the term "banking
corporation" shall include a corporation electing to be taxed under this
article pursuant to paragraph two of this subsection for so long as such
election shall be in effect.
(m) Transitional provisions relating to the enactment and
implementation of the federal Gramm-Leach-Bliley act. (1)
Notwithstanding anything to the contrary contained in this section other
than subsection (n) of this section, a corporation that was in existence
before January first, two thousand twelve and was subject to tax under
article nine-A of this chapter for its last taxable year beginning
before January first, two thousand twelve, shall continue to be taxable
under such article for all taxable years beginning on or after January
first, two thousand twelve and before January first, two thousand
fifteen. The preceding sentence shall not apply to any taxable year
during which such corporation is a banking corporation described in
paragraphs one through eight of subsection (a) of this section.
Notwithstanding anything to the contrary contained in this section other
than subsection (n) of this section, a banking corporation or
corporation that was in existence before January first, two thousand
twelve and was subject to tax under this article for its last taxable
year beginning before January first, two thousand twelve, shall continue
to be taxable under this article for all taxable years beginning on or
after January first, two thousand twelve and before January first, two
thousand fifteen only if the corporation is a banking corporation as
defined in subsection (a) of this section or the corporation satisfies
the requirements for a corporation to elect to be taxable under this
article. Provided further, that nothing in this subsection shall
prohibit a corporation that elected pursuant to subsection (d) of this
section to be taxable under article nine-A of this chapter from revoking
that election in accordance with such subsection (d).
For purposes of this paragraph, a corporation shall be considered to
be subject to tax under article nine-A of this chapter for a taxable
year if such corporation was not a taxpayer but was properly included in
a combined report filed pursuant to section two hundred eleven of this
chapter for such taxable year and a corporation shall be considered to
be subject to tax under this article for a taxable year if such
corporation was not a taxpayer but was properly included in a combined
return filed pursuant to subsection (f) or (g) of section fourteen
hundred sixty-two of this article for such taxable year. A corporation
that was in existence before January first, two thousand twelve but
first becomes a taxpayer in a taxable year beginning on or after January
first, two thousand twelve and before January first, two thousand
fifteen, shall be considered for purposes of this paragraph to have been
subject to tax under article nine-A of this chapter for its last taxable
year beginning before January first, two thousand twelve if such
corporation would have been subject to tax under such article for such
taxable year if it had been a taxpayer during such taxable year. A
corporation that was in existence before January first, two thousand
twelve but first becomes a taxpayer in a taxable year beginning on or
after January first, two thousand twelve and before January first, two
thousand fifteen, shall be considered for purposes of this paragraph to
have been subject to tax under this article for its last taxable year
beginning before January first, two thousand twelve if such corporation
would have been subject to tax under this article for such taxable year
if it had been a taxpayer during such taxable year.
(2) Notwithstanding anything to the contrary contained in this section
other than subsection (n) of this section, a corporation formed on or
after January first, two thousand twelve and before January first, two
thousand fifteen may elect to be subject to tax under this article or
under article nine-A of this chapter for its first taxable year
beginning on or after January first, two thousand twelve and before
January first, two thousand fifteen in which either (i) sixty-five
percent or more of its voting stock is owned or controlled, directly or
indirectly by a financial holding company, provided the corporation
whose voting stock is so owned or controlled is principally engaged in
activities that are described in section 4(k)(4) or 4(k)(5) of the
federal bank holding company act of nineteen hundred fifty-six, as
amended and the regulations promulgated pursuant to the authority of
such section, or (ii) it is a financial subsidiary. An election under
this paragraph may not be made by a corporation described in paragraphs
one through eight of subsection (a) of this section or in subsection (e)
of this section. In addition, an election under this paragraph may not
be made by a corporation that is a party to a reorganization, as defined
in subsection (a) of section 368 of the internal revenue code of 1986,
as amended, of a corporation described in paragraph one of this
subsection if both corporations were sixty-five percent or more owned or
controlled, directly or indirectly, by the same interests at the time of
the reorganization.
An election under this paragraph must be made by the taxpayer on or
before the due date for filing its return (determined with regard to
extensions of time for filing) for the applicable taxable year. The
election to be taxed under article nine-A of this chapter shall be made
by the taxpayer by filing the report required pursuant to section two
hundred eleven of this chapter and the election to be taxed under this
article shall be made by the taxpayer by filing the return required
pursuant to section fourteen hundred sixty-two of this article. Any
election made pursuant to this paragraph shall be irrevocable and shall
apply to each subsequent taxable year beginning on or after January
first, two thousand twelve and before January first, two thousand
fifteen, provided that the stock ownership and activities requirements
described in subparagraph (i) of this paragraph are met or such
corporation described in subparagraph (ii) of this paragraph continues
as a financial subsidiary.
(3) For purposes of this section, a financial subsidiary means a
corporation (i) sixty-five percent or more of whose voting stock is
owned or controlled, directly or indirectly by a banking corporation
described in paragraph one, two or three of subsection (a) of this
section and (ii) is described in section 5136A(g) of the revised
statutes of the United States or section 46 of the federal deposit
insurance act. For purposes of this article, the term "banking
corporation" shall include a corporation electing to be taxed under this
article pursuant to paragraph two of this subsection for so long as such
election shall be in effect.
(4) The provisions of this subsection shall not apply to a captive
REIT, a captive RIC or an overcapitalized captive insurance company.
(n)(1) Notwithstanding anything in this article to the contrary, if
any of the conditions described in paragraph three of this subsection
apply to a corporation that has made either the election to be taxable
under article nine-A of this chapter pursuant to the Gramm-Leach-Bliley
transitional provisions in this section, or the election pursuant to
subsection (d) of this section to continue to be taxable under article
nine-A of this chapter (hereinafter the "electing corporation"), then
such corporation shall be deemed to have revoked the election as of the
first day of the taxable year in which such condition applied.
(2) Notwithstanding anything in this article to the contrary, if any
of the conditions described in paragraph three of this subsection apply
to a corporation required to be taxable under article nine-A of this
chapter pursuant to the Gramm-Leach-Bliley transitional provisions in
this section (hereinafter the "grandfathered corporation"), such
corporation, if it is otherwise described in subsection (a) of this
section, shall be taxable under this article as of the first day of the
taxable year in which such condition applied.
(3) The provisions of paragraph one and paragraph two of this
subsection shall apply if any of the following conditions exist or occur
with respect to the electing corporation or the grandfathered
corporation in a taxable year (including any short taxable year)
beginning on or after January first, two thousand seven:
(A) the corporation ceases to be a taxpayer under article nine-A of
this chapter;
(B) the corporation becomes subject to the fixed dollar minimum tax
under clause (F) of subparagraph one of paragraph (d) of subdivision one
of section two hundred ten of this chapter;
(C) the corporation has no wages or receipts allocable to New York
state pursuant to subdivision three of section two hundred ten of this
chapter, or is otherwise inactive; provided that this subparagraph shall
not apply to a corporation which is engaged in the active conduct of a
trade or business, or substantially all of the assets of which are stock
and securities of corporations which are directly or indirectly
controlled by it and are engaged in the active conduct of a trade or
business;
(D) sixty-five percent or more of the voting stock of the corporation
becomes owned or controlled directly by a corporation that acquired the
stock in a transaction (or series of related transactions) that
qualifies as a purchase within the meaning of paragraph three of
subsection (h) of section three hundred thirty-eight of the internal
revenue code unless the corporation whose stock was acquired and the
corporation acquiring the stock were, immediately prior to such
purchase, members of the same affiliated group (as such term is defined
in section fifteen hundred four of the internal revenue code without
regard to the exclusions provided for in subsection (b) of such
section); provided that any acquisition that was completed on or before
January third, two thousand seven shall be treated for purposes of this
subparagraph as an acquisition made before January first, two thousand
seven; or
(E) the corporation, in a transaction or series of related
transactions, acquires assets, whether by contribution, purchase, or
otherwise, having an average value (determined in accordance with
subdivision two of section two hundred ten of this chapter), or, if
greater, a total tax basis, in excess of forty percent of the average
value, or, if greater, the total tax basis, of all the assets of the
corporation immediately prior to such acquisition and as a result of
such acquisition the corporation is principally engaged in a business that is different from the business immediately prior to such acquisition, provided that such different business is described in subparagraph (i), (ii) or (iii) of paragraph nine of subsection (a) of this section.
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