The New York City Chief Administrative Law Judge has held that Astoria Bank was not required to include in its combined New York City bank tax returns its Connecticut subsidiary that held non–New York mortgage loans. Matter of Astoria Financial Corporation & Affiliates, TAT (H) 10-35 (BT) et al. (N.Y.C. Tax Appeals Trib., Admin. Law Judge Div., Oct. 29, 2014). The Chief ALJ concluded that the subsidiary had economic substance, was formed for legitimate business purposes, and conducted its transactions with Astoria at arm's length. She also concluded that there was no agreement or arrangement with the subsidiary that caused the bank's income to be improperly or inaccurately reflected. The Chief ALJ also held that the New York State Tax Appeals Tribunal decision in Matter of Interaudi Bank was inapplicable because the facts were distinguishable, and because Interaudi did not articulate any new binding legal principle and therefore did not constitute binding precedent.

Astoria Bank was represented by Morrison & Foerster LLP in this matter.

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