NY Defends $41 Million Franchise Tax Bill Against Hotel Rehabber

An Isle of Man-based company that refurbishes luxury hotels shouldn’t be able to wriggle free from an assessment of $41.4 million in franchise taxes, interest, and penalties, New York’s tax department told a state appeals court Monday.

The New York Division of Taxation estimated Cushlin Ltd.'s tax liability after the company failed to file tax returns or sufficiently fulfill requests for documents for tax years 2002 to 2008. Cushlin asked the New York Supreme Court, Appellate Division, Third Department, last year to overturn a tribunal’s ruling upholding the assessments.

Cushlin “improperly attempts to use the protracted length of the audit ...