Section 11-502. Unincorporated business defined

(a)  General.  An
  unincorporated  business  means  any  trade,  business,  profession   or
  occupation conducted, engaged in or being liquidated by an individual or
  unincorporated   entity,   including   a  partnership,  a  fiduciary,  a
  corporation in liquidation or an unincorporated entity that has made the
  election permitted under paragraph (b) of  subdivision  one  of  section
  11-602 of this title (but only for the period during which such election
  is in effect), but not including any entity subject to tax under chapter
  six  of  this  title  and  not  including  any entity doing an insurance
  business as a member of the New York  insurance  exchange  described  in
  paragraph  one of subsection (b) of section six thousand two hundred one
  of the insurance law. Unincorporated businesses subject to tax  under  a
  local  law  of the city imposing a tax on utilities shall not be subject
  to tax  under  this  chapter;  provided,  however,  that  unincorporated
  businesses, other than (1) utility businesses subject to the supervision
  of  the  state  department  of  public service and (2) for taxable years
  beginning on or after August  first,  two  thousand  two,  utilities  as
  defined  in  subdivision six of section 11-1101 of this title, which are
  subject to tax under a local law of the city imposing a tax  on  vendors
  of  utility  services shall be subject to tax under this chapter on that
  percentage of their entire  net  income  allocable  to  the  city  under
  section  11-508  of  this  chapter which their receipts other than those
  taxable under such local law taxing vendors of utility  services  is  of
  their  total  receipts.  If  an  individual  or an unincorporated entity
  carries on wholly or partly in  the  city  two  or  more  unincorporated
  businesses,  all  such businesses shall be treated as one unincorporated
  business for the purposes of this chapter. For purposes of this chapter,
  an unincorporated entity shall be treated  as  carrying  on  any  trade,
  business, profession or occupation carried on in whole or in part in the
  city   by   any   other   unincorporated   entity  in  which  the  first
  unincorporated  entity  owns  an  interest,  and  the  ownership  by  an
  unincorporated  entity  of  an interest in another unincorporated entity
  that is not carrying on any trade, business, profession,  or  occupation
  in  whole  or  in part in the city shall not be deemed the conduct of an
  unincorporated   business   by   the   first   unincorporated    entity.
  Notwithstanding  anything to the contrary in the preceding sentence, for
  taxable years beginning on or after August first, two thousand  two,  an
  unincorporated  business  that  is a partner in a partnership subject to
  tax under a local law of the  city  imposing  a  tax  on  utilities,  as
  defined  in  subdivision six of section 11-1101 of this title, shall not
  be considered to be carrying  on  the  trade,  business,  profession  or
  occupation carried on by such partnership.
    (b) Services as employee. The performance of services by an individual
  as  an  employee or as an officer or director of a corporation, society,
  association, or political entity, or as a fiduciary, shall not be deemed
  an unincorporated business, unless such services constitute  part  of  a
  business regularly carried on by such individual.
    (c)  Purchase and sale for own account. (1) Definitions. (A) Property.
  For purposes of this subdivision, property shall mean real and  personal
  property,   including   but  not  limited  to,  property  qualifying  as
  investment capital within the meaning  of  subdivision  (h)  of  section
  11-501 of this chapter, other stocks, notes, bonds, debentures, or other
  evidences  of  indebtedness, interest rate, currency, or equity notional
  principal contracts, foreign currencies,  interests  in,  or  derivative
  financial  instruments (including options, forward or futures contracts,
  short positions, and similar  financial  instruments)  in  any  property
  described  above, and any commodity traded on or subject to the rules of
  a board of trade or  commodity  exchange,  provided,  however,  property

  shall  not  include:  (i)  debt instruments issued by the taxpayer; (ii)
  accounts receivable held by a factor; (iii) property held  as  stock  in
  trade, inventory or otherwise held for sale to customers in the ordinary
  course  of  the  taxpayer's  trade  or  business;  (iv) debt instruments
  acquired in the ordinary course of the taxpayer's trade or business  for
  funds  loaned,  services  rendered  or  for  the  sale,  rental or other
  transfer of property by the taxpayer; (v)  interests  in  unincorporated
  entities;  or  (vi)  positions in property described above entered into,
  assumed, offset, assigned or terminated by a dealer with respect to such
  positions in property.
    (B) Investor. For purposes of this subdivision, a  taxpayer  shall  be
  treated  as  acquiring,  holding  or  disposing  of  an  interest  in an
  unincorporated entity as an investor if: (i) the  unincorporated  entity
  meets  the  requirements  of  subparagraph (B) of paragraph four of this
  subdivision and the taxpayer does not receive a  distributive  share  of
  such  entity's  income,  gain,  loss, deduction, credit and basis from a
  business carried on in whole or in part in the city that  is  materially
  greater  than  its distributive share of any other item of income, gain,
  loss deduction, credit or basis of such entity; or (ii) with respect  to
  any  other  unincorporated  entity,  the  taxpayer  is neither a general
  partner nor authorized under the entity's governing instrument to manage
  or participate in, nor managing, nor participating  in,  the  day-to-day
  business of the unincorporated entity.
    (2)  An  individual or other unincorporated entity, except a dealer as
  defined in subdivision (1) of section 11-501 of this chapter, shall  not
  be  deemed engaged in an unincorporated business solely by reason of (A)
  the purchase, holding and sale for  his,  her  or  its  own  account  of
  property,  as defined in paragraph one of this subdivision, or the entry
  into, assumption, offset, assignment, or other termination of a position
  in any property so defined, or both, (B)  the  acquisition,  holding  or
  disposition,  other  than in the ordinary course of a trade or business,
  of interests in unincorporated entities  engaged  solely  in  activities
  described  in subparagraph (A), (B) or (C) of this paragraph, or (C) any
  combination of the activities described in subparagraphs (A) and (B)  of
  this  paragraph  and  any  other activity not otherwise constituting the
  conduct of an unincorporated business subject to the tax imposed by this
  chapter, but this paragraph shall not apply if the unincorporated entity
  is taxable as a corporation for federal income tax purposes.
    (3) Notwithstanding anything  to  the  contrary,  the  receipt  by  an
  individual  or  other  unincorporated  entity  of  twenty-five  thousand
  dollars or less of gross receipts during the  taxable  year  (determined
  without regard to any deductions) from an unincorporated business wholly
  or   partly   carried   on   within  the  city  by  such  individual  or
  unincorporated  entity  shall  not  cause  such  individual   or   other
  unincorporated  entity  to  be  treated  as  not  engaged  solely in the
  activities described in subparagraph (A), (B) or (C) of paragraph two of
  this subdivision.
    (4) (A) If a taxpayer that is an unincorporated  entity  is  primarily
  engaged  in  (i) activities described in subparagraph (A), (B) or (C) of
  paragraph two of this subdivision, or (ii) the acquisition,  holding  or
  disposition,  other  than in the ordinary course of a trade or business,
  of interests as an investor in unincorporated entities carrying  on  any
  unincorporated  business  in  whole or in part in the city, or both, the
  activities described in subparagraph (A), (B), or (C) of  paragraph  two
  of  this subdivision carried on by the taxpayer or by any unincorporated
  entity primarily engaged in the activities described in  clause  (i)  or
  (ii)  of  this subparagraph in which the taxpayer owns an interest shall
  not be deemed an unincorporated business carried on by the taxpayer.

    (B)  For  purposes  of  subparagraph  (A)  of   this   paragraph,   an
  unincorporated entity will be treated as primarily engaged in activities
  described  in  clause (i) or (ii) of subparagraph (A) of this paragraph,
  or both, if at least ninety percent of the value of its total assets  is
  represented by assets described in subparagraph (C) of this paragraph.
    (C)  For  purposes  of  subparagraph  (B)  of  this  paragraph, assets
  described in this subparagraph include:
    (i) property as defined in paragraph one of this subdivision;
    (ii)  interests  in  unincorporated  entities  not  carrying  on   any
  unincorporated business in whole or in part in the city; and
    (iii)   interests   in   unincorporated   entities   carrying   on  an
  unincorporated business in whole or in part in  the  city  held  by  the
  taxpayer   as   an  investor,  as  defined  in  paragraph  one  of  this
  subdivision.
    (D)  For  purposes  of  determining  whether  a  taxpayer  meets   the
  requirements  of subparagraph (B) of this paragraph, the value of assets
  described in subparagraph (C) of this paragraph  shall  be  the  average
  monthly  gross value of the assets of the taxpayer. For purposes of this
  paragraph, the value of assets of the  taxpayer  that  consist  of  real
  property or marketable securities shall be the fair market value thereof
  and  the  value  of  assets  other  than  real  property  or  marketable
  securities shall be the value thereof shown on the books and records  of
  the   taxpayer   in   accordance   with  generally  accepted  accounting
  principles. In case it shall appear to the commissioner of finance  that
  the  use  of  gross  value  in  determining  whether the requirements of
  subparagraph (B) of this paragraph are met, improperly  or  inaccurately
  reflects  the taxpayer's primary activities, the commissioner of finance
  is authorized in his or her discretion and in such manner as he  or  she
  may  determine,  to  reduce  the gross value of the taxpayer's assets by
  liabilities attributable thereto  or  to  eliminate  assets,  so  as  to
  properly and accurately reflect the taxpayer's primary activities.
    (d)  Holding,  leasing  or  managing  real  property. An owner of real
  property, a lessee or a fiduciary shall not  be  deemed  engaged  in  an
  unincorporated business solely by reason of holding, leasing or managing
  real  property.  If  an  owner  of  real property or lessee or fiduciary
  (except a dealer holding real property primarily for sale  to  customers
  in  the ordinary course of his or her trade or business) who is holding,
  leasing or managing real property is also carrying on an  unincorporated
  business  in  whole  or  in  part  in  the  city,  whether  or  not such
  unincorporated business is carried on at or is connected with such  real
  property,  such  holding, leasing or managing of real property shall not
  be deemed an unincorporated business if, and only to  the  extent  that,
  such  real  property  is  held,  leased  or  managed  for the purpose of
  producing rental income from such real property or gain upon the sale or
  other  disposition  of  such  real  property.  For  purposes   of   this
  subdivision,  the  conduct  by  such owner, lessee or fiduciary, at such
  real  property,  of  a  trade,  business,  profession   or   occupation,
  including,  but  not limited to, a garage, restaurant, laundry or health
  club, shall be deemed to be an  incident  to  the  holding,  leasing  or
  managing  of  such real property, and shall not be deemed the conduct of
  an unincorporated business,  if  such  trade,  business,  profession  or
  occupation  is  conducted solely for the benefit of tenants at such real
  property, as an incidental service to such tenants, and is not  open  or
  available  to  the general public, provided, however, if any such owner,
  lessee or fiduciary operates a garage,  parking  lot  or  other  similar
  facility  at such real property that is open or available to the general
  public, the provision by any such owner,  lessee  or  fiduciary  of  the
  service  of  parking, garaging or storing of motor vehicles on a monthly

  or longer term basis shall be deemed to be an incident to  the  holding,
  leasing  or  managing of such real property, and shall not be deemed the
  conduct of an unincorporated business if, and only to the  extent  that,
  such  monthly  or  longer  term  parking, garaging or storing service is
  provided to tenants at such real property as an  incidental  service  to
  such  tenants.  If  an  owner,  lessee  or fiduciary holding, leasing or
  managing real property operates at such real property a garage,  parking
  lot  or  other similar facility that is open or available to the public,
  each such owner, lessee or fiduciary shall file, together with and as  a
  part  of  the  returns  required under section 11-514 of this chapter, a
  report or schedule for each such garage, parking lot  or  other  similar
  facility,  or  in  the  discretion  of the commissioner, make a separate
  entry on such returns, identifying the specific  location  and  address,
  license number and licensed capacity of each such garage, parking lot or
  other  similar  facility, and shall include such additional information,
  data and other matters relating to the  provision  of  such  monthly  or
  longer  term parking, garaging or storing service to tenants as shall be
  prescribed by the commissioner of finance. If the  separate  information
  required  to  be  reported  by  any  owner, lessee or fiduciary holding,
  leasing or managing real property for any garage, parking lot  or  other
  similar  facility at such real property that is open or available to the
  public is not contained in the returns required under section 11-514  of
  this  chapter,  or  in any amended returns, in any material respect, the
  provision of parking, garaging or storing service  to  tenants  at  such
  real  property shall be deemed the conduct of an unincorporated business
  and not incident to the  holding,  leasing  or  managing  of  such  real
  property.
    (e)  Sales representative. An individual, other than one who maintains
  an office or who  employs  one  or  more  assistants  or  who  otherwise
  regularly  carries  on  a  business,  shall  not be deemed engaged in an
  unincorporated business  solely  by  reason  of  selling  goods,  wares,
  merchandise  or  insurance for more than one enterprise. For purposes of
  this subdivision, space utilized solely for the display  of  merchandise
  and/or  for  the maintenance and storage of records normally used in the
  course of business shall not be deemed an office, and the employment  of
  clerical  and  secretarial assistance shall not be deemed the employment
  of assistants.
    (f) Exempt trusts and organizations. A trust or  other  unincorporated
  organization  which  by  reason  of its purposes or activities is exempt
  from federal income tax shall not be deemed an  unincorporated  business
  (regardless  of  whether  subject  to  federal  income  tax on unrelated
  business taxable income).