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New York Department of Taxation and Finance Says Internet-Based Information Services Are Taxable

Posted 12:00 PM by

New York State & Local Tax Updates

New York Issues Guidance Indicating Internet-Based Information Services Are Taxable

In a recent Advisory Opinion, the New York State Department of Taxation and Finance (NY DOTF) has found the sales of subscription-based Internet services, Healthcare Registry and Rapid Recall Exchange by a not-for-profit are taxable sales. 

Providing access to a database of address information about trading partners – as well as compiling, communicating and managing information about product recalls – are taxable as information services. 

Source: TSB-A-15(5)S

New York Issues Opinion on LLC Member Responsibility for LLC’s Tax

The New York State Division of Tax Appeals/Tax Appeals Tribunal recently decided that an LLC member was held to be responsible with regard to the LLC’s collection and payment of tax, as the petitioner:

  • Maintained the authority to make financial payments
  • Signed at least one payroll check
  • Hired an employee
  • Was in charge of the LLC’s day-to-day operations

Since there was no evidence that the petitioner was prevented from exercising his authority to make payments, review returns and ensure the LLC's obligations were being met, he had a duty to act on the LLC's behalf and was, therefore, liable for the LLC's tax liability. 

Source: Tax Appeals Tribunal Docket 824910

New York Issues Guidance Indicating Extension of Term of a Lease Is Conveyance

The NY DOTF, in a recent Advisory Opinion, has found that an extension of an oil and gas lease, beyond its initial term, is an additional conveyance of the development rights, which is an interest in real property.

Since each conveyance of real property is subject to real estate transfer tax, the extension of the lease is subject to real estate transfer tax. 

Source: TSB-A-15(1)R

About the Author
Donna Niesen is a partner in Katz, Sapper & Miller’s State and Local Tax Group. Donna helps keep clients up-to-date on the multitude of tax rules and requirements in all 50 states. She guides them in the right direction as they address the complex issues that emerge on both the state and local levels. Connect with her on LinkedIn.

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