N.Y. Comp. Codes R. & Regs. tit. 20 § 151.18

Current through Register Vol. 46, No. 36, September 4, 2024

Section 151.18 - Group New York State nonresident personal income tax return for nonresident professional athletes

(a) General. Notwithstanding any other provision of this Subchapter, a qualified nonresident member of a professional athletic team required to file a New York State personal income tax return pursuant to section 651 of the Tax Law (see section 151.2 of this Part) may, in lieu of filing an individual New York State personal income tax return, elect to be included on a group nonresident income tax return (hereinafter referred to in this section as group return). All participating individuals must have the same accounting period.

(b) Definitions. For purposes of this section:

(1) The term professional athletic team includes any professional sports team, including, but not limited to, a baseball, basketball, football, soccer, or hockey team. A team is a single organization represented by a number of persons associated together in collective play and supporting duties. Affiliated teams that compete in different leagues shall be considered separate teams (e.g., major and minor league teams).

(2) The term member of a professional athletic team shall include employees who are active players, players on the disabled list, and any persons required to travel and who travel with and perform services on behalf of a professional athletic team on a regular basis. This includes, but is not limited to, coaches, managers, and trainers.

(3) The term qualified member of a professional athletic team means a member of a professional athletic team who meets all of the following conditions:

(i) the member must be a nonresident individual of New York State for the entire taxable year;

(ii) the member must not have maintained a permanent place of abode in New York State at any time during the taxable year;

(iii) if such member or such member's spouse received compensation which is considered to be New York State source income, pursuant to section 132.22 of this Title, from more than one professional athletic team during the taxable year, such member or spouse is included on a group return for each team. In no event shall a member or a member's spouse be allowed to file on a group basis for the same taxable year in which a New York State individual income tax return is filed for such member or member's spouse;

(iv) the member and member's spouse must:

(a) have no income derived from or connected with New York State sources for the entire taxable year other than compensation received for services rendered as a member of a professional athletic team (as determined pursuant to section 132.22 of this Title). However, nonresident members with New York source income from sources other than a professional athletic team may be eligible to file on a group return under the provisions of section 151.21 of this Part;

(b) not be subject to the minimum income tax (see section 602 of the Tax Law); or

(c) not be subject to the separate tax on the ordinary income portion of a lump sum distribution (see section 603 of the Tax Law); and

(v) the member of a professional athletic team must waive the right to claim:

(a) the New York standard or itemized deduction;

(b) dependent exemptions;

(c) any credits against New York State personal income tax; and

(d) the exclusion against the total of wages for purposes of the City of New York or City of Yonkers Nonresident Earnings Taxes.

(c) Request for permission. A professional athletic team may request permission to file a group return on behalf of participating members of such team by submitting an application on a form prescribed by the department for such purpose (or replica, reproduction, computer-prepared form or other such form containing the prescribed information). The application must be accompanied by an individual power of attorney (or other evidence of authority acceptable to the Department of Taxation and Finance) from each electing qualified member authorizing a common agent to represent such electing qualified member of a professional athletic team in making, executing, or filing the return. The request must be sent to Assistant Director, Registration and Licensing Services Bureau, New York State Department of Taxation and Finance, Building 8, Room 408, W.A. Harriman Campus, Albany, NY 12227. Request for permission to file a group return must be made by the 30th day following the close of the taxable year for which the election is requested. Permission to file a group return will be restricted to qualified members of a professional athletic team electing to participate in the filing of a group return. In no event shall more than one group return be filed in any taxable year for the same professional athletic team. Upon receipt of a properly completed application, the department will determine whether or not the initial approval will be granted and will notify the team accordingly. The department's approval to file a group return is tentative pending receipt of the final group return and subject to revision or revocation on audit. A return filed on a group basis does not constitute a request for permission to file a group return. A request to file a group return must include the following information:

(1) the name and address of the professional athletic team;

(2) the name or names of the representative(s) having the authority to act as agent(s) of electing qualified members of the professional athletic team, the name of the representative's firm, if applicable, and the street address, city, state, and postal ZIP code of the representative's place of business;

(3) the identifying number (i.e., social security number and/or employer identification number) of the representative having the authority to act as agent of the professional athletic team for the purposes of filing a group return; and

(4) the first taxable year for which the group return will be filed.

(d) Form of return on group basis. The group return is required to be filed on the form prescribed by the Department of Taxation and Finance and in the manner prescribed by the department. The group return must contain the special identifying number which will be assigned to the professional athletic team upon approval by the department. The special identifying number will remain in effect each year unless reassigned or revoked. The group return must be signed by the representative having legal authority to act as agent for all electing qualified members of the professional athletic team. In such case, the agent and each electing member are individually responsible for his or her part in making and signing the return. Each such agent or member, as the case may be, will incur liability for those penalties provided by the Tax Law that may be imposed with respect to such individual's acts in making and signing erroneous, false, or fraudulent New York State income tax returns. The fact that an agent's name is signed to a group return is prima facie evidence for all purposes that such return was actually signed by such agent. (See section 158.12 of this Title for Requirements Applicable To Tax Return Preparer.) The group return must be sent to New York State Income Tax, W.A. Harriman Campus, Albany, NY 12227.

(e) The filing of a group return will be considered as a group of separate returns which will meet the individual filing requirements of this Part. The Department of Taxation and Finance retains the right to require the filing of an individual New York State nonresident personal income tax return by any of the individual members.

(f) The filing of a group return must include an individual power of attorney (or other evidence of authority acceptable to the Department of Taxation and Finance) from each newly electing qualified member which authorizes the representative of the professional athletic team to act as agent in making, executing, and filing a group return on behalf of such electing member who had not previously filed a power of attorney (or other evidence acceptable to the Department of Taxation and Finance) and a detailed schedule indicating the name of the professional athletic team, the special identifying number assigned to such team, and the taxable year as shown on the group return. Also, for each electing qualified member of the professional athletic team, such return must include the following information:

(1) the member's name and address (in alphabetical order by last name or other order acceptable to the Department of Taxation and Finance);

(2) the member's social security number;

(3) the total compensation received during the taxable year for services rendered as a member of the professional athletic team, both within and without New York State;

(4) the number of duty days spent within New York State rendering services for the team and the total number of duty days spent both within and without New York State during the taxable year (see section 132.22 of this Title);

(5) the amount of total compensation paid by the team allocable to New York State, pursuant to section 132.22 of this Title, for each member;

(6) the New York State personal income tax as determined in accordance with subdivision (g) of this section for each member;

(7) the New York State estimated income tax or withholding tax, as the case may be, paid by or on behalf of each member (wage and tax statements must accompany the filing of the group return);

(8) the balance due or overpayment (any overpayment will not be refunded, but applied to the respective member's estimated income tax for the following year);

(9) where such member is employed by more than one professional athletic team during the taxable year, the name or names of such other professional athletic team; and

(10) any other information the Department of Taxation and Finance may require.

(g) New York State personal income tax. For purposes of this section, a participating member's New York State personal income tax is determined by multiplying such member's compensation allocable to New York State (as determined under section 132.22 of this Title) by the highest effective rate of New York State personal income tax for the applicable taxable year.

(h) If a group return is not filed for a taxable year after approval has been granted, the approval to file a group return will be revoked for subsequent taxable years unless the professional athletic team requests permission from the department for reinstatement.

(i) Where a professional athletic team elected to file group required installments pursuant to section 185.3(k)(2) of this Title, and later determines that an individual electing member will not participate in the filing of a group return or where such individual electing member fails to qualify, pursuant to paragraph (b)(3) of this section, the professional athletic team should notify the Department of Taxation and Finance, in writing, by the 15th day of the second month following the close of the taxable year in which the member elects not to participate or fails to qualify, as the case may be. This will enable the department sufficient time to transfer required installments of estimated tax paid on behalf of such member on a group basis to an individual account. An electing qualified member of a professional athletic team may not change such member's election to file on a group basis to an individual basis after the 15th day of the fourth month following the close of the taxable year in which the election is effective. (See section 161.3 of this Title.)

(j) A professional athletic team that has been granted approval by the Department of Taxation and Finance to file a group return for electing nonresident athletes must notify the department, in writing, if such team decides that it will not be filing a group return for a taxable year. Such decision will revoke approval by the department for such team to file a group return in subsequent taxable years unless the team requests permission from the department for reinstatement.

N.Y. Comp. Codes R. & Regs. Tit. 20 § 151.18