Burton v. New York State Dep’t of Taxation & Fin.

Plaintiffs, several nonresident former owners and shareholders in an S corporation, filed the instant declaratory judgment action against the New York State Department of Taxation and Finance, challenging a tax imposed on their pro rata share of gains from the sale of the corporation’s stock. Specifically, Plaintiffs alleged that N.Y. Const. art. XVI, 3 absolutely precluded taxation of gains from the sale of a nonresident’s intangible personal property - in this case, the corporation’s stock. Supreme Court granted Defendant’s motion for summary judgment and declared that the statute is constitutional. The Court of Appeals affirmed, holding that there is no constitutional bar to taxation of a nonresident’s New York-source income earned from a stock sale. View "Burton v. New York State Dep’t of Taxation & Fin." on Justia Law