<p>New York Tax Tribunal Finds Scaling Factor May Not Be Applied to International Bank's Allocation Percentages</p>

New York Tax Tribunal Finds Scaling Factor May Not Be Applied to International Bank's Allocation Percentages

The New York Tax Appeals Tribunal ruled that the Division of Taxation improperly determined that a foreign bank's international banking facility (IBF) had ineligible gross income under 20 NYCRR 18-3, and thus incorrectly applied a scaling factor to the IBF's deposits and payroll factors.

The New York Tax Appeals Tribunal ruled that the Division of Taxation improperly determined that a foreign bank's international banking facility (IBF) had ineligible gross income under 20 NYCRR 18-3, and thus incorrectly applied a scaling factor to the IBF's deposits and payroll factors, because the terms under 20 NYCRR 18-3 are not applicable to returns filed using the formula apportionment method under 20 NYCRR 19-2.3(b).