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Knowing New York’s Tax Rules Lets CRE Owners Be Prepared For An Audit

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Property owners and managers in New York are prime targets for state taxing authorities.

As development in Long Island promises to enhance transit-oriented districts and the New York City skyline continues to expand with redevelopment and new construction, developers must understand the sales tax implications of their  activity. Knowing whether a project constitutes an exempt capital improvement or taxable repair and maintenance service can safeguard against costly, unexpected assessments and misguided overpayments.   

  • Substantially adds value to the real property or extends its useful life;
  • Is permanently affixed to the real property so that removal would cause material damage to the real property or article itself; and
  • Is intended to become a permanent installation.

Projects that do not fit within the capital improvement exemption are generally considered repair and maintenance activities and are subject to sales tax.

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