General Corporation Tax (GCT)

All S corporations and qualified S subsidiaries in New York City must pay the General Corporation Tax (GCT) if they are:

• Doing business
• Using money for business
• Owning or renting property
• Keeping an office

New York City does not have an S corporation election. It does not recognize a New York State S corporation election. Federal subchapter S corporations and qualified subchapter S subsidiaries must pay the GCT.

If a corporation is not subject to the tax but has an officer, employee, agent or other representative in New York City, it must file Form NYC-245, Activities Report of Business and General Corporations.

Who is exempt from the GCT?

Some corporations do not have to pay the GCT. The instructions to Forms NYC-3L and NYC-4S explain which ones. Here are some examples:

• Dormant S corporations that did not do any business or own property in New York City
• S corporations that pay the banking corporation tax
• S corporations that pay the utility tax, except vendors of utility services, which must pay the GCT
• S corporations organized to hold property as described in sections 501(c)(2) or (25) of the Internal Revenue Code
• Insurance corporations
• Non-profit companies that got an exemption from the New York City Department of Finance
• Limited profit housing and housing development fund companies organized under articles 2 and 11 of the Private Housing Finance Law

Starting from January 1, 2015, the GCT only applies to Subchapter S Corporations and Qualified Subchapter S Subsidiaries under the U.S. Internal Revenue Code. These corporations will keep filing GCT tax returns if they must pay the GCT. The forms have not changed. All other corporations now pay the Business Corporation Tax and will file Business Corporation Tax returns instead of GCT returns. For more information, visit the Business Corporation Tax page.