For tax years beginning on or after January 1, 2016, law firms that must file and/or pay New York City Unincorporated Business Tax (NYC UBT) must file a return (Form NYC-204) and pay the tax due by the 15th day of the third month following the close of the tax year (e.g., March 15, 2017, for 2016 calendar-year taxpayers). Accordingly, law firms should update their tax filing calendars to reflect this due date.

Background

Historically, law firms subject to NYC UBT had to file and pay the balance of any tax due by the 15th day of the fourth month following the close of the tax year (e.g., April 15, for calendar-year taxpayers,).

Tax Update

For tax years beginning January 1, 2016, H.R. 3236 (the Surface Transportation and Veterans Health Care Choice Improvement Act of 2015) provides that Federal Partnership Income Tax Returns (Forms 1065) are due on the 15th day of the third month following the close of a taxpayer's year end (e.g., March 15, for calendar-year taxpayers). Before January 1, 2016, Federal Partnership Income Tax Returns were due the 15th day of the fourth month following the close of a taxpayer's year-end.

To conform with the new federal due dates, 2016 Governor Cuomo signed on September 30, L. 2016, A10266 (c. 391)which provides that, effective for tax years beginning on or after January 1, 2016, partnerships required to file NYC UBT must file and pay the balance of tax due on or before the 15th day of the third month following the close of a tax year.¹ Further, for tax years beginning on or after January 1, 2016, prepaid tax would be deemed paid on the 15th day of the third month following the close of the tax year for which the prepaid amount constitutes a credit or payment.

Lastly, New York City generally allows an automatic six-month NYC UBT filing extension pursuant to the submission of Form NYC-EXT, extending the NYC UBT return due date from March 15 to September 15 for calendar-year taxpayers.

EY will continue to track any updates and will include updates in future Alerts.

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ENDNOTES

¹ New York State similarly adopted the federal due date changes in its 2016-2017 executive budget with regard to partnership filings.