Accounting Periods and Methods.
19 RCNY § 3-02
in effect§ 3-02 Accounting Periods and Methods.
(a) Accounting periods.
(1) General. (Administrative Code, § 11-638(b); § 11-639(a))
(i) Generally, for Federal income tax purposes, a taxpayer's taxable year is the same as its accounting period. In most cases, the taxable year for which the banking corporation tax is to be computed and for which a tax return is to be filed shall be the same as the taxpayer's taxable year for Federal income tax purposes or that portion of the Federal taxable year for which the taxpayer is subject to the banking corporation tax. (See: 19 RCNY § 3-01(b) "taxable year"). The taxable year under the banking corporation tax law will, generally, be the accounting period covered by the taxpayer's Federal income tax return whether such period be a calendar year, a properly established fiscal year, an accounting period consisting of 52 or 53 weeks or an accounting period of less than 12 months as permitted or required under the Internal Revenue Code. If a taxpayer does not have a taxable year for Federal income tax purposes, the tax must be computed and a return must be filed for a calendar year, unless the Commissioner of Finance authorizes the use of some different accounting period.
(ii) The banking corporation tax is imposed for each fiscal or calendar year of the taxpayer, or any part thereof, during which the taxpayer is doing business in a corporate or organized capacity in New York City. Therefore, for purposes of the banking corporation tax, the taxpayer's first taxable year begins on the date it commences doing business in a corporate or organized capacity in New York City and ends on the last day of its fiscal or calendar year or the last day it is subject to the banking corporation tax, whichever comes first.
(2) Calendar year taxpayers.
(i) A taxpayer which reports on the basis of a calendar year for Federal income tax purposes must report on the same basis for purposes of the banking corporation tax. A calendar year is a period of 12 calendar months ending on December 31, or a period of less than 12 calendar months beginning on the date a taxpayer becomes subject to tax and ending on December 31. A calendar year also includes, in the case of a taxpayer which changes the period on the basis of which it keeps its books from a fiscal year to a calendar year, the period from the close of its last fiscal year to and including the following December 31.
(ii) A taxpayer shall use a calendar year as its accounting period and report on a calendar year basis in the following situations:
(A) the taxpayer keeps its books on the basis of a calendar year;
(B) the taxpayer keeps its books on the basis of any period ending on any day other than the last day of a calendar month except in the case of a taxpayer which keeps its books on the basis of a 52-53 week accounting period;
(C) the taxpayer does not keep books; or
(D) the taxpayer is not required to file a Federal income tax return, unless the use of a fiscal year or a 52-53 week period basis of reporting has been authorized by the Commissioner of Finance.
(3) Fiscal year taxpayers.
(i) A taxpayer which reports on the basis of a fiscal year for Federal income tax purposes must report on the same basis for purposes of the banking corporation tax. A fiscal year is a period not longer than 12 calendar months, or any shorter period beginning on the date the taxpayer becomes subject to tax and ending on the last day of any month other than December. A fiscal year also includes, in the case of a taxpayer which changes the period on the basis of which it keep its books from a calendar year to a fiscal year or from one fiscal year to another fiscal year, the period from the close of its last calendar or fiscal year up to the date designated as the close of its new fiscal year. A fiscal year also includes a 52-53 week accounting period if such period has been elected by the taxpayer.
(ii) A taxpayer reporting on a fiscal year basis must keep its books on such basis.
(4) 52-53 week fiscal year taxpayers.
(i) A taxpayer which reports on the basis of a 52-53 week accounting period for Federal income tax purposes must report on the same basis for purposes of the banking corporation tax. A 52-53 week period must end on the same day of the week each year and end always on whatever date that day of the week last occurs in a calendar month, or on whatever date that day of the week falls which is nearest the last day of a calendar month.
(ii) If a 52-53 week accounting period is used and the period starts within seven days from the first day of any calendar month, the taxable year will be deemed to have begun on the first day of such calendar month. If a 52-53 week accounting period ends within seven days from the last day of any calendar month, the taxable year will be deemed to have ended on the last day of such month.
(iii) If a taxpayer uses a 52-53 week accounting period for Federal income tax purposes and becomes subject to the banking corporation tax, the taxpayer may be required to file returns for two taxable years during an accounting period for which one Federal return is required. For example, a banking corporation commences doing business in New York City on Monday, October 29, 1984. The corporation uses a 52-53 week accounting period ending on the Saturday nearest the last day of October for Federal income tax purposes. The 52-53 week accounting period for which the corporation computes its tax for Federal income tax purposes begins October 28, 1984 and ends Saturday, November 2, 1985. For purposes of the banking corporation tax, the period from October 29, 1984 to October 31, 1984, inclusive, is deemed to be the first period for which a return is due and a tax payable. The next taxable period is deemed to be from November 1, 1984 to October 31, 1985 and is based on the accounting period ending November 2, 1985.
(5) Change of accounting period.
(i) If a taxpayer's accounting period for Federal income tax purposes is changed, the taxable year and accounting period for which the taxpayer's return is filed under the banking corporation tax must be changed at the same time to coincide with the new Federal income tax accounting period and taxable year. (See: 19 RCNY § 3-05(a)(2) – Short period returns.)
(ii) Where a taxable year or accounting period of less than 12 months results from a change of accounting period, the taxpayer must file a return and pay the tax due for the period beginning from the close of the last taxable year or accounting period for which a return was required to be filed to the date designated as the close of its new accounting period or taxable year. Where a change in a taxable year from or to a 52-53 week accounting period, or from one 52-53 week period to a different 52-53 week period, results in a period of either 359 days or more or six days or less the 359 day or more period must be computed as if it were a full taxable year, and the period of six days or less must be added to and deemed part of the following taxable year. In the case of a period consisting of more than six days and less than 359 days, a return must be filed for such period.
(iii) A taxpayer whose accounting period is changed for Federal income tax purposes is not required to apply for or obtain permission to make a similar change with respect to returns required under the banking corporation tax. In such a case, however, the taxpayer must submit with the first return filed for the new accounting period under the banking corporation tax a copy of the consent of the Commissioner of Internal Revenue to the change for Federal income tax purposes. A taxpayer which changes its accounting period for Federal income tax purposes without the prior approval of the Commissioner of Internal Revenue must submit with the first return filed for the new accounting period under the banking corporation tax law, a statement indicating the authority for the change of the Federal accounting period.
(iv) In the case of a taxpayer which has an established accounting period for Federal income tax purposes, no change of accounting period for purposes of the banking corporation tax (other than one required by reason of a change of the Federal accounting period as set forth in subparagraph (i) of this paragraph) will be permitted.
(b) Accounting methods.
(1) General. (Administrative Code, § 11-641(m); § 11-641.1; § 11-643.5(b))
(i) The accounting method or basis on which entire net income, alternative entire net income or taxable assets is to be computed must be the same as the taxpayer's method of accounting for Federal income tax purposes. However, when the Commissioner of Finance deems it necessary in order to properly reflect the entire net income or alternative entire net income of the taxpayer, he may determine the taxable year or period in which any item of income or deduction must be included, without regard to the method of accounting used by the taxpayer. (See: 19 RCNY § 3-03(b)(6) – Taxable year in which income or deduction is included in entire net income and 19 RCNY § 3-03(d)(3) – Taxable year in which income or deduction is included in alternative entire net income.) When the Commissioner of Finance deems it necessary in order to properly reflect the taxable assets of the taxpayer, he may determine the taxable year or period in which any adjustment to the value of an asset may be claimed, without regard to the method of accounting used by the taxpayer.
(ii) In the absence of an accounting method for Federal income tax purposes, entire net income, alternative entire net income or taxable assets must be computed in accordance with the method regularly employed in keeping the books of the taxpayer, provided such method properly reflects entire net income, alternative entire net income or taxable assets. If the books of a taxpayer do not properly reflect entire net income, alternative entire net income or taxable assets or if no books are kept, the computation of entire net income, alternative entire net income or taxable assets must be made in such manner as the Commissioner of Finance deems necessary to properly reflect entire net income, alternative entire net income or taxable assets.
(2) Change of accounting method.
(i) If a taxpayer's method of accounting for Federal income tax purposes is changed, the accounting method employed in determining entire net income, alternative entire net income or taxable assets for purposes of the banking corporation tax must be changed at the same time to the method approved for Federal income tax purposes. When a change of accounting method is made, any adjustments which are determined to be necessary solely by reason of the change in order to prevent amounts from being duplicated or omitted must be taken into account to the extent they are required to be taken into account in determining the taxpayer's Federal taxable income.
(ii) A taxpayer whose method of accounting is changed must submit with its first return in which the new accounting method is used a copy of the consent of the Commissioner of Internal Revenue, together with complete details of any adjustments with respect to items of income or deduction or adjustments to the value of assets.
(c) Cessation periods. (Administrative Code, § 11-639(a))
(1) The banking corporation tax is imposed for each taxable year during which a taxpayer does business in a corporate or organized capacity in New York City. Accordingly, for purposes of the banking corporation tax, every taxpayer is subject to tax up to the date on which it ceases to do business in a corporate or organized capacity in New York City.
(2) A taxpayer may cease to be subject to the banking corporation tax because of a change in classification. (See: 19 RCNY § 3-01(c)(5) – Change in classification.) In some cases, a corporation may then become subject to tax under some other subchapter of Chapter 6 of Title 11 or some other chapter of Title 11 of the Administrative Code.
(3) For rules concerning the time for filing cessation returns, see 19 RCNY § 3-05(d)(3).
Source: City of New York, Charter, Administrative Code and Rules (American Legal Publishing XML export, codelibrary.amlegal.com)URL: https://codelibrary.amlegal.com/codes/newyorkcity/latest/NYCrules/0-0-0-34857Fetched: 10/24/2026