Philadelphia Skyline

Obtaining Favorable Building Capital Improvement Tax Categorization from the New York State Department of Taxation and Finance

February 19, 2016
Itkowitz PLLC helped obtain favorable building capital improvement tax categorization on behalf of a midtown office building client from the New York State Department of Taxation and Finance.

Our client owns a midtown office building for which it had undertaken major capital repairs to the fa├žade. The rehabilitation included replacement of windows, removal and replacement of failing sealant, removal and replacement of upper roof coping, replacement and repair of terracotta blocks, and repair and replacement of steel components.

In the absence of denominating the work as a capital improvement, the owner would have been liable for sales tax on work and materials for the job.  However, upon our application, the Department of Taxation and Finance agreed the work was a capital improvement and therefore was not subject to sales tax pursuant to Section 1105(c)(5) of the Tax Code.

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