Section 210-C - Combined reports1. Tax. (a) The tax on a combined report shall be the highest of (i) the combined business income base multiplied by the tax rate specified in paragraph (a) of subdivision one of section two hundred ten of this article; (ii) the combined capital base multiplied by the tax rate specified in paragraph (b) of subdivision one of section two hundred ten of this article, but not exceeding the limitation provided for in that paragraph (b); or (iii) the fixed dollar minimum that is attributable to the designated agent of the combined group. In addition, the tax on a combined report shall include the fixed dollar minimum tax specified in paragraph (d) of subdivision one of section two hundred ten of this article for each member of the combined group, other than the designated agent, that is a taxpayer.(b) The combined business income base is the amount of the combined business income of the combined group that is apportioned to the state, reduced by any prior net operating loss conversion subtraction and any net operating loss deduction for the combined group. The combined capital base is the amount of the combined capital of the combined group that is apportioned to the state. 2. Combined reports required. (a) Except as provided in paragraph (c) of this subdivision, any taxpayer (i) which owns or controls either directly or indirectly more than fifty percent of the voting power of the capital stock of one or more other corporations, or (ii) more than fifty percent of the voting power of the capital stock of which is owned or controlled either directly or indirectly by one or more other corporations, or (iii) more than fifty percent of the voting power of the capital stock of which and the capital stock of one or more other corporations, is owned or controlled, directly or indirectly, by the same interests, and (iv) that is engaged in a unitary business with those corporations (hereinafter referred to as "related corporations"), shall make a combined report with those other corporations.(b) A corporation required to make a combined report within the meaning of this section shall also include (i) a captive REIT and a captive RIC if the captive REIT or captive RIC is not required to be included in a combined report under article thirty-three of this chapter; (ii) a combinable captive insurance company; and (iii) an alien corporation that satisfies the conditions in paragraph (a) of this subdivision if (I) under any provision of the internal revenue code, that corporation is treated as a "domestic corporation" as defined in section seven thousand seven hundred one of the internal revenue code, or (II) it has effectively connected income for the taxable year pursuant to clause (iv) of the opening paragraph of subdivision nine of section two hundred eight of this article.(c) A corporation required or permitted to make a combined report under this section does not include (i) a corporation that is taxable under a franchise tax imposed by article nine or article thirty-three of this chapter or would be taxable under a franchise tax imposed by article nine or thirty-three of this chapter if subject to tax; (ii) a REIT that is not a captive REIT, and a RIC that is not a captive RIC; (iii) a New York S corporation; or (iv) an alien corporation that under any provision of the internal revenue code is not treated as a "domestic corporation" as defined in section seven thousand seven hundred one of such code and has no effectively connected income for the taxable year pursuant to clause (iv) of the opening paragraph of subdivision nine of section two hundred eight of this article. If a corporation is subject to tax under this article solely as a result of its ownership of a limited partner interest in a limited partnership that is doing business, employing capital, owning or leasing property, maintaining an office in this state, or deriving receipts from activity in this state, and none of the corporation's related corporations are subject to tax under this article, such corporation shall not be required or permitted to file a combined report under this section with such related corporations.(d) A combined report shall be filed by the designated agent of the combined group as determined under subdivision seven of this section.3. Commonly owned group election. (a) Subject to the provisions of paragraph (c) of subdivision two of this section, a taxpayer may elect to treat as its combined group all corporations that meet the ownership requirements described in paragraph (a) of subdivision two of this section (such corporations collectively referred to in this subdivision as the "commonly owned group"). If that election is made, the commonly owned group shall calculate the combined business income, combined capital, and fixed dollar minimum bases of all members of the group in accordance with subdivision four of this section, whether or not that business income or business capital is from a single unitary business.(b) The election under this subdivision shall be made on an original, timely filed return of the combined group , determined with regard to extensions of time for filing. Any corporation entering a commonly owned group subsequent to the year of election shall be included in the combined group and is considered to have waived any objection to its inclusion in the combined group.(c) The election shall be irrevocable, and binding for and applicable to the taxable year for which it is made and for the next six taxable years. The election will automatically be renewed for another seven taxable years after it has been in effect for seven taxable years unless it is affirmatively revoked. The revocation shall be made on an original, timely filed return for the first taxable year after the completion of a seven year period for which an election under this subdivision was in place. In the case of a revocation, a new election under this subdivision shall not be permitted in any of the immediately following three taxable years. In determining the seven and three year periods described in this paragraph, short taxable years shall not be considered or counted.4. Computation of tax bases on a combined report. (a) In computing the tax bases for a combined report, the combined group shall generally be treated as a single corporation, except as otherwise provided, and subject to any regulations or guidance issued by the commissioner or the department.(b)(i) In computing combined business income, all intercorporate dividends shall be eliminated, and all other intercorporate transactions shall be deferred in a manner similar to the United States Treasury regulations relating to intercompany transactions under section fifteen hundred two of the internal revenue code.(ii) In computing combined capital, all intercorporate stockholdings, intercorporate bills, intercorporate notes receivable and payable, intercorporate accounts receivable and payable, and other intercorporate indebtedness, shall be eliminated.(c) Qualification for credits, including any limitations thereon, shall be determined separately for each of the members of the combined group, and shall not be determined on a combined group basis, except as otherwise provided. However, the credits shall be applied against the combined tax of the group. To the extent that a provision of section two hundred ten-B of this article limits a credit to the fixed dollar minimum amount prescribed in paragraph (d) of subdivision one of section two hundred ten of this article, such fixed dollar minimum amount shall be the fixed dollar minimum amount that is attributable to the designated agent of the combined group.(d)(i) A net operating loss deduction is allowed in computing the combined business income base. Such deduction may reduce the tax on the combined business income base to the higher of the tax on the combined capital base or the fixed dollar minimum amount that is attributable to the designated agent of the combined group. A combined net operating loss deduction is equal to the amount of combined net operating loss or losses from one or more taxable years that are carried forward or carried back to a particular taxable year. A combined net operating loss is the combined business loss incurred in a particular taxable year multiplied by the combined apportionment factor for that year determined as provided in subdivision five of this section. (ii) The combined net operating loss deduction and combined net operating loss are also subject to the provisions contained in clauses one through seven of subparagraph (ix) of paragraph (a) of subdivision one of section two hundred ten of this article. (iii) In the case of a corporation that files a combined report, either in the year the net operating loss is incurred or in the year in which a deduction is claimed on account of the loss, the combined net operating loss deduction is determined as if the combined group is a single corporation and, to the extent possible and not otherwise inconsistent with this subdivision, is subject to the same limitations that would apply for federal income tax purposes under the internal revenue code and the code of federal regulations as if such corporation had filed for such taxable year a consolidated federal income tax return with the same corporations included in the combined report. If a corporation files a combined report, regardless of whether it filed a separate return or consolidated return for federal income tax purposes, the net operating loss and net operating loss deduction for the combined group must be computed as if the corporation had filed a consolidated return for the same corporations for federal income tax purposes.(iv) In general, any net operating loss carryover from a year in which a combined report was filed shall be based on the combined net operating loss of the group of corporations filing such report. The portion of the combined loss attributable to any member of the group that files a separate report for a succeeding taxable year will be an amount bearing the same relation to the combined loss as the net operating loss of such corporation bears to the total net operating loss of all members of the group having such losses to the extent that they are taken into account in computing the combined net operating loss.(d-1) A prior net operating loss conversion subtraction is allowed in computing the combined business income base, as provided in subparagraph (viii) of paragraph (a) of subdivision one of section two hundred ten of this article. Such subtraction may reduce the tax on the combined business income base to the higher of the tax on the combined capital base or the fixed dollar minimum amount that is attributable to the designated agent of the combined group. (e)(i) Any election made pursuant to paragraph (b) of subdivision six, paragraphs (b) and (c) of subdivision six-a of section two hundred eight , and item (IV) of subclause two of clause (B) of subparagraph (viii) and clause seven of subparagraph (ix) of paragraph (a) of subdivision one of section two hundred ten of this article shall apply to all members of the combined group.(ii) The determination of whether or not the limitation on investment income provided in subparagraph (iii) of paragraph (a) of subdivision six of section two hundred eight of this article applies to the combined group shall be based on the investment income of the combined group, determined without regard to interest expenses attributable to investment capital or investment income, and the entire net income of the combined group.(f)(i) In the case of a captive REIT or captive RIC required under this section to be included in a combined report, entire net income shall be computed as required under subdivision five (in the case of a captive REIT) or subdivision seven (in the case of a captive RIC) of section two hundred nine of this article. However, the deduction under the internal revenue code for dividends paid by the captive REIT or captive RIC to any member of the affiliated group that includes the corporation that directly or indirectly owns over fifty percent of the voting stock of the captive REIT or captive RIC shall not be allowed. For purposes of this subparagraph, the term "affiliated group" means "affiliated group" as defined in section fifteen hundred four of the internal revenue code, but without regard to the exceptions provided for in subsection (b) of that section.(ii) In the case of a combinable captive insurance company required under this section to be included in a combined report, entire net income shall be computed as required by subdivision nine of section two hundred eight of this article.(g) If more than one member of a combined group is eligible for any of the modifications described in paragraphs (r), (s) and (t) of subdivision nine of section two hundred eight of this article, all such members must utilize the same modification.5. Apportionment on a combined report. (a) In determining the apportionment factor for a combined report, the receipts, net income, net gains and other items of all members of the combined group, whether or not they are a taxpayer, are included and intercorporate receipts, income and gains are eliminated. Receipts, net income, net gains and other items are sourced, and the amounts allowed in the apportionment factor are determined, as provided in section two hundred ten-A of this article.(b) An election made to apportion income and gains from qualifying financial instruments pursuant to subparagraph one of paragraph (a) of subdivision five of section two hundred ten-A of this article shall apply to all members of the combined group.6. Liability of combined group members. Every member of the combined group that is subject to tax under this article shall be jointly and severally liable for the tax due pursuant to a combined report.7. Designated agent. Each combined group shall have one designated agent for the combined group, which shall be a taxpayer. Only the designated agent may act on behalf of the members of the combined group for matters relating to the combined report.Amended by New York Laws 2016, ch. 60,Sec. P-8, eff. 1/1/2015.Amended by New York Laws 2015, ch. 59,Sec. T-33 and Sec. T-33-a, eff. 1/1/2015.Added by New York Laws 2014, ch. 59,Sec. A-18, eff. 1/1/2015.