N.Y. Comp. Codes R. & Regs. tit. 20 § 105.3

Current through Register Vol. 46, No. 45, November 2, 2024

Section 105.3 - Short periods resulting from a change in accounting period

Tax Law, § 605(a)(2)

(a) Where a short period results from a change in the taxpayer's accounting period, the taxpayer must, where such taxpayer meets any of the conditions provided for in section 151.9 of this Title (relating to New York State personal income tax returns for short taxable periods), also file a New York State personal income tax return for such short period. Such taxpayer's New York taxable income must be computed on the basis of the period for which the New York State personal income tax return is made and in accordance with the rules applicable to the determination of New York taxable income generally (see sections 611 and 618 of the Tax Law), except that the standard deduction (see section 614 of the Tax Law) and exemptions (see section 616 of the Tax Law) will be allowed only to the following extent:

(1) Standard deduction. The amount allowed as a New York standard deduction is that amount which bears the same ratio to the New York standard deduction allowed (see section 614 of the Tax Law), as the number of months in the short period bears to 12 months.

(2) Exemptions. The amount of allowable exemptions is that amount which bears the same ratio to the full amount for such exemptions (see section 616 of the Tax Law), as the number of months in such short period bears to 12 months.

(b) The provisions of subdivision (a) of this section are illustrated by the following example:

Example:

A resident individual had been filing Federal and New York State personal income tax returns on the basis of a fiscal year ending March 31st. Such individual changes to a calendar year in 1991 and files a Federal and New York State personal income tax return for the short period April 1, 1991 to December 31, 1991. Such individual's New York adjusted gross income for this short period was $12,000. Assume that such individual is a head of household, claiming the standard deduction and entitled to claim two dependent exemptions. The amount such individual is entitled to claim as a standard deduction and the amount such individual is entitled to claim for exemptions on the New York State personal income tax return for the short period (April 1, 991 to December 31, 1991) is determined as follows: Standard deduction $7,000 x 9/12 = $5,250 Two dependent exemptions of $1,000 each = $2,000 x 9/12 = $1,500 New York taxable income for the short period is determined as follows:

New York adjusted gross income	$12,000
Less: Standard deduction	5,250
Balance	$ 6,750
Less: Exemptions	1,500
New York taxable income	$ 5,250

N.Y. Comp. Codes R. & Regs. Tit. 20 § 105.3