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I just sold a rental house in New York city last April and

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I just sold a rental house in New York city last April and paid the nonresident real property estimated income tax using the IT-2663 form during closing the sale. Now, I'm preparing for the Federal income tax, New York State income tax. The question that I have is do I have to pay the New York city income tax, such as the 'unincorporated business tax' to New York city?

Welcome to Just Answer. I am here to help you resolve your tax and finance concerns. Please feel free to ask anytime you need extra help.

 

You will need to pay NYC income tax on the gain, if any, resulting from the property sale. If you are not a NYC resident you will not need to pay other NYC taxes. I will check on the NYC UBT and return momentarily.

Based on the following, if your only business activity in NYC last year was the rental building you are not required to file the UBT or pay the UBT:

 

 

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Unincorporated Business Tax (UBT)

A tax is charged to every individual or unincorporated entity carrying on a trade, business, or profession - in whole or part - in New York City.

What Activities are Subject to This Tax?
By Law, What Activities and Unincorporated Entities
are
Exempt from this Tax?
Conformity with State Laws
Tax Credits
Tax Forms & Filing Information
Tax Rates
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Frequently Asked Questions
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What Activities are Subject to This Tax?

Note: The Metropolitan Commuter Transportation Mobility Tax does not need to be added back when filing UBT returns for the 2009 tax year.

Unincorporated Businesses include: trades, professions, and certain occupations of an individual, partnership, limited liability company, fiduciary, association, estate or trust. The business can be active or in the process of being liquidated.

If a person carries on two or more Unincorporated Businesses, all are treated as one for the purpose of this tax.



By Law, What Activities and Unincorporated Entities are Exempt from this Tax?

  • The performance of services by an individual as an employee is not subject to UBT. The facts of each case determine whether or not an individual acts as an employee.
  • A person or entity, other than a dealer, who is only engaged in the purchase, holding, and sale of property for their own personal account (e.g. a person who owns and rents a two-family house); and
  • An owner, lessee, or fiduciary who is engaged in holding, leasing, or managing real property for their own account.
  • Entities engaged primarily with qualifying investment activities are partially exempt from UBT on the income.
  • Associations and publicly traded partnerships treated as corporations for federal income tax purposes; and "S Corps." are subject to the General Corporation Tax.
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