Exhibit 8.2
[KPMG PEAT MARWICK LLP LETTERHEAD]
July 11, 1996
Board of Trustees
Amsterdam Federal Savings & Loan Association
161 Church Street
Amsterdam, New York 12010
Board Members:
You have requested the opinion of KPMG Peat Marwick LLP ("KPMG") as to the New
York State franchise and New York State personal income tax consequences
relating to the proposed conversion of Amsterdam Federal Savings & Loan
Association from a federally chartered mutual savings and loan association to a
federally chartered stock savings bank (Stock Bank) and the formation of AFSALA
Bancorp, Inc. which will acquire all of the outstanding stock of Stock Bank.
You have submitted to us a copy of the federal income tax opinion ("Federal
Opinion") relating to the federal income tax consequences of the proposed
transaction prepared by your counsel, Malizia, Spidi, Sloane & Fisch, P.C. and
dated June 17, 1996.
Our opinion regarding the New York State franchise and New York State personal
income tax consequences of the proposed transaction is based on the same facts,
assumptions and conditions contained in the Federal Opinion. It is also based on
existing New York Tax Law which is subject to change. We have not reviewed the
legal documents necessary to effectuate the steps to be undertaken, and we
assume that all steps will be properly effectuated under state and federal law
and will be consistent with the legal documentation.
In our opinion, the New York State franchise and New York State personal income
tax consequences of the proposed transaction are consistent with the federal
income tax consequences of the proposed transaction opined upon in the Federal
Opinion.
For purposes of the franchise tax the State of New York has adopted federal
taxable income (Internal Revenue Code Sec. 63), as currently amended, as the
starting point for computing New York entire net income (NYS Tax Law Sec. 1453).
Franchise tax terms are defined in relation to the Internal Revenue Code of
1986, as amended. Taxpayers are required to use federal taxable income as the
starting point for the computation of entire net income.
Several specific modifications to federal taxable income are enumerated in the
New York Tax Law and the Banking Corporation Regulations in determining income
taxable for New York State franchise tax purposes, however there are no specific
modifications which apply to the proposed transaction (see New York State Tax
Law Article 32, Sections 1453 (b) through (m) and Regulation Sections 18-2.3,
18-2.4 and 18-2.5 of the Franchise Tax on Banking Corporations).
The State of New York has adopted federal adjusted gross income (IRC Sec. 62),
as currently amended, as the starting point for computing New York taxable
income (NYS Tax Law Sec. 612) for personal income tax purposes. Income tax terms
are defined in relation to the Internal Revenue Code of 1986, as amended.
Board of Directors
Amsterdam Federal Savings & Loan Association
July 11, 1996
Page 2
Several specific modifications to federal taxable income are enumerated in the
New York Statutes in determining income taxable for New York State personal
income tax purposes, however there are no specific modifications which apply to
the proposed transaction (see New York State Tax Law Article 22, Sections 612
(b) through (t) and Regulation Sections 112.2 through 112.13 of the Personal
Income Tax).
Our opinion as expressed above is rendered only with respect to the New York
franchise and New York State personal income tax consequences of specific
matters discussed herein, and we express no opinion with respect to any other
New York franchise, income or transfer tax matter or any other federal, state,
local or foreign tax matter relating to the proposed transaction. Our opinion is
based on the facts and conditions as stated herein, whether directly or by
reference to the Federal Opinion. It is expressly understood and agreed to by
Amsterdam Federal Savings & Loan Association, Stock Bank, and AFSALA Bancorp.
Inc. that KPMG is relying solely on the Federal Opinion in all respects relating
to the federal tax consequences of the matters described herein. KPMG has not
independently verified the accuracy of any fact, representation, opinion or
other matter contained in the Federal Tax Opinion and should any fact,
representation, opinion or other matter addressed therein not be correct, it
could cause the New York State franchise and income tax opinion contained herein
to also be incorrect. If any of the facts and conditions are not entirely
complete or accurate, it is imperative that we be informed immediately, as the
inaccuracy or incompleteness could have a material effect on our conclusions. In
rendering our opinion, we are relying upon the relevant provisions of the
Internal Revenue Code of 1986, as amended, and New York Statutes, as amended,
the regulations and rules thereunder and judicial and administrative
interpretations thereof, which are subject to change or modification by
subsequent legislative, regulatory, administrative, or judicial decisions. Any
such changes could also have an effect on the validity of our opinion. We
undertake no responsibility to update or supplement our opinion after its
issuance. This opinion is not binding upon any tax authority or any court and no
assurance can be given that a position contrary to that expressed herein will
not be asserted by a tax authority and ultimately sustained by a court.
Very truly yours,
KPMG Peat Marwick LLP
/s/Brian C. Flynn
Brian C. Flynn
Partner
BCF/ms