New York State Nonresident Partnership or S Corporation Withholding: Certificate of Exemption Expires February 1, 2012
1/27/2012
Quick action may be required for nonresident shareholders and partners of New York State S corporations, partnerships, and limited liability companies or partnerships who have completed Form IT-2658-E, Certificate of Exemption from Partnership or New York S Corporation Estimated Tax Paid on Behalf of Nonresident Individual Partners and Shareholders (“Certificate”). The Certificate, applicable for the 2010 and 2011 tax years, is expiring February 1, 2012. It is recommended that a revised Form IT-2658-E, which applies to the 2012 and 2013 tax years, be executed by affected individuals as soon as possible.
New York State requires S corporations, partnerships, and limited liability companies or partnerships (collectively “Entities”) to make estimated personal income tax payments on behalf of its nonresident partners and shareholders to the extent that the Entities have New York source income. In this regard, nonresident partners or shareholders are exempt from these estimated tax requirements if they satisfy one of the following exceptions:
- The annual estimated tax required to be paid by the Entity on behalf of its partner or shareholder is $300 or less;
- The partner or shareholder has elected to be included in the Entities’ group/composite tax return; or
- The nonresident partner or shareholder executes Form IT-2658-E.
By completing the Certificate, the nonresident partner or shareholder is certifying that he/she will be compliant with their New York State personal income tax filing requirements.
Click here to access the new Certificate for tax years 2012 and 2013.
The completed Certificates are not required to be filed with the Department of Taxation and Finance, but are to be kept by the Entity in the event of an audit.
For more information on the Certificate or other state and local tax matters, please contact Corey L. Rosenthal, JD, a J.H. Cohn director and member of the Firm’s State and Local Tax Practice, at crosenthal@jhcohn.com or 646-625-5729, or Patrick J. Duffany, CPA, JD, partner and director of the Firm’s State and Local Tax Practice, at pduffany@jhcohn.com or 860-368-3607.
Circular 230 Notice: In compliance with U.S. Treasury Regulations, the information included herein (or in any attachment) is not intended or written to be used, and it cannot be used, by any taxpayer for the purpose of i) avoiding penalties the IRS and others may impose on the taxpayer or ii) promoting, marketing, or recommending to another party any tax related matters.