In Matter of Goldman Sachs Petershill Fund Offshore Holdings (Delaware) Corp., the New York City Tax Tribunal held that an upper-tier partnership’s passive corporate partner was subject to the New York City General Corporation Tax (GCT) on the upper-tier partnership’s sale of an interest in a lower-tier partnership that was doing business in New York City.
The GCT is imposed on the corporate partners of a partnership doing business in New York City. The administrative law judge rejected the corporate partner’s argument that the upper-tier partnership’s investment in the lower-tier partnership should be analogized to an investment in corporate stock; instead, the judge held that the corporate partner’s distributive share of capital gain from the upper-tier partnership’s sale of the lower-tier partnership (as well as its distributive share of pre-sale income, deductions, gains, and losses from the lower-tier partnership) was subject to the GCT.
Linda Z. Swartz
Partner
T. +1 212 504 6062
linda.swartz@cwt.com
Adam Blakemore
Partner
T. +44 (0) 20 7170 8697
adam.blakemore@cwt.com
Jon Brose
Partner
T. +1 212 504 6376
jon.brose@cwt.com
Andrew Carlon
Partner
T. +1 212 504 6378
andrew.carlon@cwt.com
Mark P. Howe
Partner
T. +1 202 862 2236
mark.howe@cwt.com
Catherine Richardson
Partner
T. +44 (0) 20 7170 8677
catherine.richardson@cwt.com
Gary T. Silverstein
Partner
T. +1 212 504 6858
gary.silverstein@cwt.com