§ 631 — New York source income of a nonresident individual

New York § 631

• Jurisdiction: New York
• Law TAX: Tax
• Part 3: Nonresidents and Part-year Residents
• Art. 22: Personal Income Tax

Text

§ 631. New York source income of a nonresident individual. (a)\nGeneral. The New York source income of a nonresident individual shall\nbe the sum of the following: (1) The net amount of items of income,\ngain, loss and deduction entering into his federal adjusted gross\nincome, as defined in the laws of the United States for the taxable\nyear, derived from or connected with New York sources, including: (A)\nhis distributive share of partnership income, gain, loss and deduction,\ndetermined under section six hundred thirty-two, and\n (B) his pro rata share of New York S corporation income, loss and\ndeduction, increased by reductions for taxes described in paragraphs two\nand three of subsection (f) of section thirteen hundred sixty-six of the\ninternal revenue code, determined under section six hundred thirty-two,\nand\n (C) his share of estate or trust income, gain, loss and deduction,\ndetermined under section six hundred thirty-four and\n (2) The portion of the modifications described in subsections (b) and\n(c) of section six hundred twelve which relate to income derived from\nNew York sources (including any modifications attributable to him as a\npartner or shareholder of a New York S corporation).\n (b) Income and deductions from New York sources.\n (1) Items of income, gain, loss and deduction derived from or\nconnected with New York sources shall be those items attributable to:\n (A) the ownership of any interest in real or tangible personal\nproperty in this state; or\n (1) For purposes of this subparagraph, the term "real property located\nin this state" includes an interest in a partnership, limited liability\ncorporation, S corporation, or non-publicly traded C corporation with\none hundred or fewer shareholders (hereinafter the "entity") that owns\nreal property that is located in New York or owns shares of stock in a\ncooperative housing corporation where the cooperative units relating to\nthe shares are located in New York; provided, that the sum of the fair\nmarket values of such real property, cooperative shares, and related\ncooperative units equals or exceeds fifty percent of all the assets of\nthe entity on the date of sale or exchange of the taxpayer's interest in\nthe entity. Only those assets that the entity owned for at least two\nyears before the date of the sale or exchange of the taxpayer's interest\nin the entity are to be used in determining the fair market value of all\nthe assets of the entity on the date of sale or exchange. The gain or\nloss derived from New York sources from the taxpayer's sale or exchange\nof an interest in an entity that is subject to the provisions of this\nsubparagraph is the total gain or loss for federal income tax purposes\nfrom that sale or exchange multiplied by a fraction, the numerator of\nwhich is the fair market value of the real property, and the cooperative\nhousing corporation stock and related cooperative units located in New\nYork on the date of sale or exchange and the denominator of which is the\nfair market value of all the assets of the entity on the date of sale or\nexchange.\n (B) a business, trade, profession or occupation carried on in this\nstate; or\n (C) in the case of a shareholder of an S corporation where the\nelection provided for in subsection (a) of section six hundred sixty of\nthis article is in effect, the ownership of shares issued by such\ncorporation, to the extent determined under section six hundred\nthirty-two of this article; or\n (D) winnings from a wager placed in a lottery conducted by the\ndivision of the lottery, if the proceeds from such wager exceed five\nthousand dollars; or\n (D-1) gambling winnings in excess of five thousand dollars from\nwagering transactions within the state; or\n (E) gains from the sale, conveyance or other disposition of shares of\nstock in a cooperative housing corporation in connection with the grant\nor transfer of a proprietary leasehold by the owner thereof and subject\nto the provisions of article thirty-one of this chapter, whether such\nshares are held by a partnership, trust or otherwise; or\n (E-1) in the case of an S corporation for which an election is in\neffect pursuant to subsection (a) of section six hundred sixty of this\narticle that terminates its taxable status in New York, any income or\ngain recognized on the receipt of payments from an installment sale\ncontract entered into when the S corporation was subject to tax in New\nYork, allocated in a manner consistent with the applicable methods and\nrules for allocation under article nine-A or thirty-two of this chapter,\nin the year that the S corporation sold its assets.\n (F) income received by nonresidents related to a business, trade,\nprofession or occupation previously carried on in this state, whether or\nnot as an employee, including but not limited to, covenants not to\ncompete and termination agreements. Income received by nonresidents\nrelated to a business, trade, profession or occupation previously\ncarried on partly within and partly without the state shall be allocated\nin accordance with the provisions of subsection (c) of this section.\n (2) Income from intangible personal property, including annuities,\ndividends, interest, and gains from the disposition of intangible\npersonal property, shall constitute income derived from New York sources\nonly to the extent that such income is from property employed in a\nbusiness, trade, profession, or occupation carried on in this state or\nfrom winnings from a wager placed in a lottery conducted by the division\nof the lottery, if the proceeds from such wager exceed five thousand\ndollars. Income from the disposition of intangible personal property\nshall also constitute income derived from New York sources to the extent\nsuch gains are from the sale, conveyance or other disposition of shares\nof stock in a cooperative housing corporation in connection with the\ngrant or transfer of a proprietary leasehold by the owner thereof and\nsubject to the provisions of article thirty-one of this chapter, whether\nsuch shares are held by a partnership, trust or otherwise.\n (3) Income directly or indirectly derived by an athlete, entertainer,\nor performing artist from closed-circuit and cable television\ntransmissions of an event (other than events occurring on a regularly\nscheduled basis) taking place within the state as a result of the\nrendition of services by such athlete, entertainer or performing artist\nshall constitute income derived from New York sources only to the extent\nthat such transmissions were received or exhibited within the state.\n (4) Deductions with respect to capital losses, passive activity losses\nand net operating losses shall be based solely on income, gain, loss and\ndeduction derived from or connected with New York sources, under\nregulations of the commissioner of taxation and finance, but otherwise\nshall be determined in the same manner as the corresponding federal\ndeductions.\n (5) In the case of a nonresident individual or partner of a\npartnership doing an insurance business as a member of the New York\ninsurance exchange described in section six thousand two hundred one of\nthe insurance law, any item of income, gain, loss or deduction of such\nbusiness which is the individual's distributive or pro rata share for\nfederal income tax purposes or which the individual is required to take\ninto account separately for federal income tax purposes, shall not\nconstitute income, gain, loss or deduction derived from New York\nsources.\n (6) The deduction allowed by section two hundred fifteen of the\ninternal revenue code, relating to alimony, shall not constitute a\ndeduction derived from New York sources.\n (c) Income and deductions partly from New York sources. If a business,\ntrade, profession or occupation is carried on partly within and partly\nwithout this state, as determined under regulations of the tax\ncommission, the items of income, gain, loss and deduction derived from\nor connected with New York sources shall be determined by apportionment\nand allocation under such regulations.\n (d) Purchase and sale for own account.-- A nonresident, other than a\ndealer holding property primarily for sale to customers in the ordinary\ncourse of his trade or business, shall not be deemed to carry on a\nbusiness, trade, profession or occupation in this state solely by reason\nof the purchase and sale of property or the purchase, sale or writing of\nstock option contracts, or both, for his own account.\n (e) Military pay. Compensation paid by the United States for active\nservice in the armed forces of the United States, performed by an\nindividual not domiciled in this state, shall not constitute income\nderived from New York sources.\n (f) Husband and wife. If husband and wife determine their federal\nincome tax on a joint return but are required to determine their New\nYork income taxes separately, they shall determine their New York source\nincomes separately as if their federal adjusted gross incomes had been\ndetermined separately.\n (g) Stock option grants, stock appreciation rights and restricted\nstock. A nonresident taxpayer who has been granted statutory stock\noptions, restricted stock, nonstatutory stock options or stock\nappreciation rights and who, during such grant period, performs services\nwithin New York for, or is employed within New York by, the corporation\ngranting such option, stock or right, shall compute his or her New York\nsource income as determined under rules and regulations prescribed by\nthe commissioner.\n