N.Y. Comp. Codes R. & Regs. tit. 20 § 132.1
Tax Law, § 632(a)
The New York adjusted gross income of a nonresident individual includes all items of income, gain, loss and deductions which enter into his Federal adjusted gross income; limited, however, to the portions of such items derived from or connected with New York State sources as determined under sections 132.2 through 132.11 of this Part. In addition to the items realized directly by him, it includes (1) his distributive share of partnership income, gain, loss and deduction (see Part 137 of this Article), and (2) his share of estate or trust income, gain, loss and deduction (see Part 139 of this Article). The items thus determined are subject to the same modifications as are applicable for a resident individual under Part 112 of this Title.
Example:
A, a nonresident, receives during 1980 the following items of income:
| 1. | Income from salary as a corporate officer paid in New York State by check on a New York City bank. For 1980, 20 percent of A's working days were properly considered days worked outside of New York State. | $10,000 |
| 2. | Distributive share of income from a partnership carrying on business as a manufacturer's representative both within and without New York State: 70 percent of the income of the partnership was properly allocable to New York State. | $35,000 |
| 3. | Net rental income from an apartment house located in New Jersey. | $ 3,000 |
| 4. | A's share as beneficiary under a trust under the will of A's father, who died a resident of New York State. Income of the trust consists of: Net rentals from medical office building located in New York City. | $ 4,000 |
| Dividends from stock of a New York State corporation. | $ 6,000 | |
| A's share as 50-percent beneficiary. | $ 5,000 | |
| The net amount of A's items of income and gain entering into his Federal adjusted gross income derived from or connected with New York State sources is determined as follows: | ||
| 1. | Salary (determined on the basis of days worked in and out of New York State and not by where payment was made) (see section 132.18 of this Part for applicable allocation rules). | $ 8,000 |
| 2. | Partnership income (determined on the basis of the partnership's 70-percent allocation) (see Part 137 of this Article for applicable allocation rules). | $24,500 |
| 3. | Income from New Jersey apartment house (entirely excluded) (see section 132.3 of this Part). | -0- |
| 4. | Income from trust (limited to A's 50-percent share of New York State rental income because stock dividends are intangibles and not taxable for New York State personal income tax purposes) (see Part 139 of this Article). | $ 2,000 |
| Total income and gain derived from or connected with New York State sources. | $34,500 | |
The modifications of Federal adjusted gross income described in sections 112.2 -112.5 and 112.7-112.9 of this Title which are made by a resident individual in determining his New York adjusted gross income are also made by a nonresident individual when the modifications relate to income (gain or loss) derived from New York State sources. Modifications of a nonresident individual include modifications which relate to his share of partnership income derived from or connected with New York State sources (see Part 137 of this Article) and his share of "net change" from New York State sources from an estate or trust (see Part 139 of this Article).
Example:
B, a nonresident, is a partner in a partnership engaged in the securities business as a broker and dealer holding all of its securities for sale to customers in the ordinary course of business and not as investments. All of the partnership's business is carried on in New York State. B's distributive share of partnership income for 1977 includes the following items of income and deduction:
| Interest income on obligations of states other than New York | $2,000 |
| New York State unincorporated business income tax of the partnership, deducted in determining B's distributive share of income of the partnership for Federal income tax purposes | $ 250 |
| Interest or indebtedness incurred by the partnership to carry United States government bonds | $ 100 |
| Interest on United States government bonds | $1,000 |
| Interest and dividends on securities of limited dividend housing companies organized under New York State law | $ 100 |
| Refund of New York State unincorporated business income taxes which were deducted for Federal income tax purposes in determining the distributive shares of taxable income of the partnership for a prior taxable year, and which are included in partnership income for Federal income tax purposes | $ 100 |
| Since the partnership carried on its business entirely in New York State, all of the foregoing items are derived from or connected with New York State sources. Accordingly, the following modifications are made in determining B's New York adjusted gross income: | |
| Modifications increasing Federal adjusted gross income: | |
| Interest income on obligations of states other than New York | $2,000 |
| New York State unincorporated business income tax of the partnership, deducted in determining B's distributive share of income of the partnership for Federal income tax purposes | $ 250 |
| Interest on indebtedness incurred by the partnership to carry United States government bonds | $ 100 |
| Total modifications increasing Federal adjusted gross income | $2,350 |
| Modifications reducing Federal adjusted gross income: | |
| Interest on United States government bonds | $1,000 |
| Interest and dividends on securities of limited dividend housing companies organized under New York State law | $ 100 |
| Refund of New York State unincorporated business income taxes which were deducted for Federal income tax purposes in determining the distributive shares of taxable income of the partnership for a prior taxable year, and which are included in partnership income for Federal income tax purposes | $ 100 |
| Total modifications reducing Federal adjusted gross income | $1,200 |
N.Y. Comp. Codes R. & Regs. Tit. 20 § 132.1