N.Y. Comp. Codes R. & Regs. tit. 20 § 534.4
Tax Law, § 1119(b)
Example 1:
Buses of the X Company operate, pursuant to a certificate of convenience and necessity from the Commissioner of Transportation, from a terminal in the city of A to a station in the city of B, proceed to a station in the city of C and continue to a terminal in the city of D. All of the cities and all of the mileage are within the State of New York. The distance along the route traveled from A to B is 80 miles, from B to C is 80 miles and from C to D is 60 miles. Between A and B these buses pick up and discharge passengers at stops along the highway, but they do not do this between B and C and C and D. Between A and B and C and D these buses are operated in local transit service, but not between B and C.
Example 2:
Buses of the Y Company operate from a terminal in A, a city within the State of New York, to a terminal in B, a city outside the State of New York. Between the terminal in A and the State boundary, the buses do not pick up or discharge any passengers. These buses are not being operated in local transit service because they are not carrying passengers from one point in this State to another point in this State.
Example 3:
Buses of the Z Company operate from a terminal in A to a station in B and proceed to a terminal in C. Cities A and C are in New York State and city B is outside of New York State. The distance between each of the cities along the route traveled is 20 miles. The company carries passengers from city A to cities B and C. The buses will be considered as operating in local transit service since the total distance between points A and C is less than 75 miles, even though the distance from A to C includes some mileage outside of the State.
Example 4:
Assume the facts in example 3, except that the distance between each of the cities is 40 miles. The buses will not be considered as operating in local transit service, since the total distance between points A and C is greater than 75 miles. The fact that the company carries passengers from city A to city B, a distance of 40 miles does not qualify such carriage as a local transit service because it is not between two points within the State of New York.
Example 5:
Under the facts of Example 3 set forth in paragraph (3) of this subdivision, omnibus carrier Z operates its buses for 65,000 miles. Of this number of miles, 17,500 miles are between the terminal in city A and the station in city B, of which 1,000 miles are operated outside of New York State. 17,500 miles are operated between the station in city B and the terminal in city C, of which 4,000 miles are operated outside of the State. 15,000 miles are operated in school bus contract service in New York State and 15,000 miles are operated in charter service in New York State. Vehicle mileage consists of 30,000 miles which is composed of the 16,500 miles traveled in New York State between cities A and B and the 13,500 miles traveled in New York State between cities B and C. Total mileage consists of 60,000 miles which is all of the miles operated except the 5,000 miles operated out of the State. The local transit service percentage is 50 percent (the percentage that 30,000 miles bears to 60,000 miles).
provided such items are actually used or consumed only on or in omnibuses.
Example 6:
An omnibus carrier purchases log books, desks, and chairs for a waiting room, 20,000 gallons of motor fuel, 20 carburetors, and is charged by a local garage for 200 hours of service. Omnibuses of the carrier use 15,000 gallons of motor fuel, require 15 carburetors, and 150 hours of service time. Repair vehicles use 3,000 gallons of motor fuel, require 3 carburetors and 30 hours of service time. Supervisors' cars require 2,000 gallons of motor fuel, 2 carburetors and 20 hours of service time. The only purchases eligible for a refund or credit are those actually used on or consumed in the operation or repair of the omnibus itself. Accordingly, only the cost of 15,000 gallons of motor fuel, 15 carburetors and 150 hours of service time is eligible for refund or credit of tax paid. The cost of the remaining motor fuel, carburetors, hours of service time, log books, desks and chairs is not eligible.
The refund or credit is determined in accordance with the following table:
| If the local transit service percentage is: | The refund or credit is: |
| Less than 10 percent | None |
| 10 percent | 10 percent of the combined State and local taxes paid |
| Greater than 10 percent but less then 70 percent | 10 percent plus the product of 1.5 times each whole percent in excess of 10 percent of the combined State and local taxes paid |
| 70 percent or more | 100 percent of the combined State and local taxes paid |
Example 7:
Under the facts of example 5, set forth in paragraph (6) of subdivision (a) of this section, it was determined that the local transit service percentage of omnibus carrier Z is 50 percent. Omnibus carrier Z is entitled to a refund of 70 percent of the tax paid on items eligible for such refund or credit, computed as follows:
| initial 10% | = 10% + |
| 40% × 1.5 | = 60% |
| Total | 70% |
An application for refund or credit must be filed with the Department of Taxation and Finance and must cover a period of not less than three months. (For the administrative provisions on applying for credit or refund, see section 534.2 of this Part.)
Cross-reference:
Application for and use of direct payment permits by omnibus carriers see section 532.5(h) of this Title.
N.Y. Comp. Codes R. & Regs. Tit. 20 § 534.4