Department Concludes that Tickets for Charity Softball Game Are Taxable

The New York State Department of Taxation and Finance has found that ticket sales for a charity softball game played at a stadium owned by a minor league baseball team are subject to New York sales tax. Advisory Opinion, TSB-A-17(8)S (N.Y.S. Dep't of Taxation & Fin., June 21, 2017). Although the nonprofit organization that rented the facility for the game is an exempt organization for sales tax purposes, and generally would not be required to collect sales tax on admission charges, these charges were found to be taxable because the game was played to benefit the nonprofit organization itself, not for the benefit of an elementary or secondary school, and the statute specifically limits the exemption to proceeds that exclusively benefit an elementary or secondary school. Tax Law 1116(d)(2)(A), 20 NYCRR 527.10(e). In addition, the petitioner had collected sales tax on the admission charges, so it would have been required to remit those taxes to the Department even if the game had been found nontaxable.

MTA Employee Subject to "Frivolous Petition" Penalty

An employee of the MTA New York City Transit system who claimed that he was not subject to New York State and City income tax on his wages was held by a New York State Administrative Law Judge to be subject to tax on his wages. Matter of Reginald Marthone, DTA No. 827279 (N.Y.S. Div. of Tax App., June 29, 2017). The ALJ also imposed a $500 "frivolous petition" penalty against the taxpayer, concluding that his position before the Division of Tax Appeals that his wages were not includable in his taxable income was a frivolous position meriting the penalty.