Buchbinder Tunick & Co. v. Tax Appeals Tribunal

OPINION OF THE COURT

Smith, J.

The issue presented in this case is whether payments made in liquidation of partnership interests, which constitute the retiring partners’ pro rata share of the partnership’s unreal*391ized receivables, are payments “for services or for use of capital” within the meaning of section 11-507 (3) of the Administrative Code of the City of New York and thus not deductible from the partnership’s unincorporated business gross income. We conclude that the payments here may not be deducted because they are compensation for the retiring partners’ services to the partnership.

Petit…