N.Y. GCT Law § 12 — New York Code / Act GCT / Article 2-D / Part 1-6 / Part 2 / Section 25-A-12
City adjusted gross income of a resident individual
Status: in_force

§ 12. City adjusted gross income of a resident individual.--(a)\nGeneral.--The city adjusted gross income of a resident individual means\nhis federal adjusted gross income as defined in the laws of the United\nStates for the taxable year, with the modifications specified in this\nsection.\n  (b) Modifications increasing federal adjusted gross income.--There\nshall be added to federal adjusted gross income:\n  (1) Interest income on obligations of any state other than this state\nor of a political subdivision of any such other state unless created by\ncompact or agreement to which this state is a party;\n  (2) Interest or dividend income on obligations or securities of any\nauthority, commission, or instrumentality of the United States, which\nthe laws of the United States exempt from federal income tax but not\nfrom state or local income taxes;\n  (3) Income taxes imposed by the city, this state or any other taxing\njurisdiction, to the extent deductible in determining federal adjusted\ngross income and not credited against federal income tax;\n  (4) Interest on indebtedness incurred or continued to purchase or\ncarry obligations or securities the income from which is exempt from tax\nunder this local law, to the extent deductible in determining federal\nadjusted gross income;\n  (5) Expenses paid or incurred during the taxable year for (A) the\nproduction or collection of income which is exempt from tax under this\nlocal law, or (B) the management, conservation or maintenance of\nproperty held for the production of such income, and the amortizable\nbond premium for the taxable year on any bond the interest on which is\nexempt from tax under this local law, to the extent that such expenses\nand premiums are deductible in determining federal adjusted gross\nincome; and\n  (6) In the case of a taxpayer who has exercised the election permitted\nby subdivisions (g) or (h) of this section, the amount or amounts\nrequired by said subdivisions to be added to federal adjusted gross\nincome.\n  (c) Modifications reducing federal adjusted gross income.--There shall\nbe subtracted from federal adjusted gross income:\n  (1) Interest income on obligations of the United States and its\npossessions to the extent includible in gross income for federal income\ntax purposes;\n  (2) Interest or dividend income on obligations or securities of any\nauthority, commission or instrumentality of the United States to the\nextent includible in gross income for federal income tax purposes but\nexempt from state or local income taxes under the laws of the United\nStates;\n  (3) Pensions to officers and employees of this state, its subdivisions\nand agencies, to the extent includible in gross income for federal\nincome tax purposes;\n  (4) Interest or dividend income on obligations or securities to the\nextent exempt from income tax under the laws of this state authorizing\nthe issuance of such obligations or securities but includible in gross\nincome for federal income tax purposes;\n  (5) The amount of any refund or credit for overpayment of income taxes\nimposed by the city, the state, or any other taxing jurisdiction, to the\nextent properly included in gross income for federal income tax\npurposes;\n  (6) Interest on indebtedness incurred or continued to purchase or\ncarry obligations or securities the income from which is subject to tax\nunder this local law but exempt from federal income tax, to the extent\nthat such interest is not deductible in determining federal adjusted\ngross income and is attributable to a trade or business carried on by\nthe taxpayer;\n  (7) Ordinary and necessary expenses paid or incurred during the\ntaxable year for (A) the production or collection of income which is\nsubject to tax under this local law but exempt from federal income tax,\nor (B) the management, conservation or maintenance of property held for\nthe production of such income, and the amortizable bond premium for the\ntaxable year on any bond the interest on which is subject to tax under\nthis local law but exempt from federal income tax, to the extent that\nsuch expenses and premiums are not deductible in determining federal\nadjusted gross income and are attributable to a trade or business\ncarried on by the taxpayer;\n  (8) In the case of a taxpayer who has exercised the election permitted\nby subdivisions (g) or (h) of this section, the amount or amounts\nrequired by said subdivisions to be subtracted from federal adjusted\ngross income;\n  (9) With respect to gain derived from the sale or other disposition of\nany property acquired prior to July first, nineteen hundred sixty-six,\nexcept property described in subsections one and four of section twelve\nhundred twenty-one of the internal revenue code, the difference\nbetween--\n  (a) the amount of the taxpayer's federal adjusted gross income or, in\nthe case of an estate or trust, the taxpayer's taxable income, and\n  (b) the amount of the taxpayer's federal adjusted gross income or, in\nthe case of an estate or trust, the taxpayer's taxable income (if\nsmaller than the amount described in (a)) computed as if the federal\nadjusted basis of such property (on the sale or other disposition of\nwhich gain was derived) on the date of the sale or other disposition had\nbeen equal to either (i) its fair market value on July first, nineteen\nhundred sixty-six or the date of its sale or other disposition prior to\nJuly first, nineteen hundred sixty-six, plus or minus all adjustments to\nbasis made with respect to such property for federal income tax purposes\nfor periods on and after July first, nineteen hundred sixty-six or (ii)\nthe amount realized from its sale or disposition, whichever is lower;\nprovided, however, that the total modification provided by this\nsubparagraph shall not exceed the amount described in (i), (ii) or\n(iii)--\n  (i) if the taxpayer's federal adjusted gross income reflects a net\ngain from the sale or other disposition of property, except property\ndescribed in subsections one and four of section twelve hundred\ntwenty-one of the internal revenue code, the amount of such gain plus\none thousand dollars,\n  (ii) if the taxpayer's federal adjusted gross income reflects a net\nloss from the sale or other disposition of property, except property\ndescribed in subsections one and four of section twelve hundred\ntwenty-one of the internal revenue code, the amount by which one\nthousand dollars exceeds such loss,\n  (iii) if the taxpayer's federal adjusted gross income reflects neither\na net gain nor a net loss from the sale or other disposition of\nproperty, other than property described in subsections one and four of\nsection twelve hundred twenty-one of the internal revenue code, one\nthousand dollars.\n  (d) Modification for city fiduciary adjustment.--There shall be added\nto or subtracted from federal adjusted gross income (as the case may be)\nthe taxpayer's share, as beneficiary of an estate or trust, of the city\nfiduciary adjustment determined under section nineteen.\n  (e) Partners.--The amounts of modifications required to be made under\nthis section by a partner, which relate to items of income, gain, loss\nor deduction of a partnership, shall be determined under section\nseventeen.\n  (f) Husband and wife.--If husband and wife determine their federal\nincome tax on a joint return but determine their city income taxes\nseparately, they shall determine their city adjusted gross incomes\nseparately as if their federal adjusted gross incomes had been\ndetermined separately.\n  (g) Optional modifications.--At the election of the taxpayer there\nshall also be subtracted from federal adjusted gross income either or\nboth of the items set forth in paragraphs one and two of this\nsubdivision, except that only one of such items shall be subtracted with\nrespect to any one item of property.\n  (1) Depreciation with respect to any property such as described in\nparagraph three of this subdivision, not exceeding twice the\ndepreciation allowed with respect to the same property for federal\nincome tax purposes. Such modification shall be allowed only upon\ncondition that any depreciation allowed with respect to the same\nproperty in determining federal adjusted gross income shall be added to\nfederal adjusted gross income pursuant to paragraph six of subdivision\n(b) of this section. The total of all deductions allowed pursuant to\nthis paragraph in any taxable year or years with respect to any property\nshall not exceed its cost or other basis.\n  (2) Expenditures paid or incurred during the taxable year for the\nconstruction, reconstruction, erection or acquisition of any property\nsuch as described in paragraph three of this subdivision which is used\nor to be used for purposes of research and development in the\nexperimental or laboratory sense. Such purposes shall not be deemed to\ninclude the ordinary testing or inspection of materials or products for\nquality control, efficiency surveys, management studies, consumer\nsurveys, advertising, promotions or research in connection with\nliterary, historical or similar projects. Such modification shall be\nallowed only on condition that, for the taxable years, and all\nsucceeding years, any deductions allowed for federal income tax purposes\non account of such expenditures or on account of depreciation of the\nsame property, except to the extent that its basis may be attributable\nto factors other than such expenditures, shall be added to federal\nadjusted gross income pursuant to paragraph six of subdivision (b) of\nthis section, or in case a modification is allowable pursuant to this\nparagraph for only a part of such expenditures, on condition that a\nproportionate part of any such deductions allowed for federal income tax\npurposes be added to federal adjusted gross income. With respect to\nproperty which is used or to be used for research and development only\nin part, or during only part of its useful life, the modification\nallowable pursuant to this paragraph shall be limited to a proportionate\npart of the expenditures relating thereto. If a modification shall have\nbeen allowed pursuant to this paragraph for all or part of such\nexpenditures with respect to any property, and such property is used for\npurposes other than research and development to a greater extent than\noriginally reported, the taxpayer shall report such use in his return\nfor the first taxable year during which it occurs, and the administrator\nmay recompute the tax for the year or years for which such deduction was\nallowed, and may assess any additional tax resulting from such\nrecomputation within the time fixed by subdivision (c) of section\nsixty-three of this local law.\n  (3) Such modifications shall be allowed only with respect to tangible\nproperty which is depreciable pursuant to section one hundred\nsixty-seven of the internal revenue code, having a situs in the city and\nused in the taxpayer's trade or business, (A) the construction,\nreconstruction or erection of which is completed after June thirtieth,\nnineteen hundred sixty-six, and then only with respect to that portion\nof the basis thereof or the expenditures relating thereto which is\nproperly attributable to such construction, reconstruction or erection\nafter June thirtieth, nineteen hundred sixty-six, or (B) acquired after\nJune thirtieth, nineteen hundred sixty-six by purchase as defined in\nsection one hundred seventy-nine (d) of the internal revenue code, if\nthe original use of such property commenced with the taxpayer, commenced\nin the city and commenced after such date.\n  (4) If the modifications allowable for any taxable year pursuant to\nthis subdivision exceed the taxpayer's city adjusted gross income,\ndetermined without the allowance of such modifications, the excess may\nbe carried over to the following taxable year or years and may be\nsubtracted from federal adjusted gross income for such year or years.\n  (5) In any taxable year when property is sold or otherwise disposed\nof, with respect to which a modification has been allowed pursuant to\nparagraph one or two of this subdivision, the basis of such property\nshall be adjusted to reflect the modifications so allowed, and if the\nbasis as so adjusted is lower than the adjusted basis of the same\nproperty for federal income tax purposes, there shall be added to\nfederal adjusted gross income the amount of the difference between such\nadjusted bases; but if such gain or loss is considered a long-term\ncapital gain or loss for federal income tax purposes, the amount to be\nadded shall be limited to fifty percent of the difference between such\nadjusted bases.\n  (h) Optional modification for waste treatment facility\nexpenditures.--At the election of the taxpayer, there shall also be\nsubtracted from federal adjusted gross income expenditures paid or\nincurred during the taxable year for the construction, reconstruction,\nerection or improvement of industrial waste treatment facilities and air\npollution control facilities.\n  (1) (A) The term "industrial waste treatment facilities" shall mean\nfacilities for the treatment, neutralization, or stabilization of\nindustrial waste (as the term "industrial waste" is defined in section\ntwelve hundred two of the State public health law) from a point\nimmediately preceding the point of such treatment, neutralization or\nstabilization to the point of disposal, including the necessary pumping\nand transmitting facilities, but excluding such facilities installed for\nthe primary purpose of salvaging materials which are usable in the\nmanufacturing process or are marketable.\n  (B) The term "air pollution control facilities" shall mean facilities\nwhich remove, reduce, or render less noxious air contaminants emitted\nfrom an air contamination source (as the terms "air contaminant" and\n"air contamination source" are defined in section twelve hundred\nsixty-seven of the state public health law) from a point immediately\npreceding the point of such removal, reduction or rendering the point of\ndischarge of air, meeting emission standards as established by the air\npollution control board, but excluding such facilities installed for the\nprimary purpose of salvaging materials which are usable in the\nmanufacturing process or are marketable and excluding those facilities\nwhich rely for their efficacy on dilution, dispersion or assimilation of\nair contaminants in the ambient air after emmission.\n  (2) Such modifications shall be allowed only\n  (A) with respect to tangible property which is depreciable, pursuant\nto section one hundred sixty-seven of the internal revenue code, having\na situs in the city and used in the taxpayer's trade or business, the\nconstruction, reconstruction, erection or improvement of which, in the\ncase of industrial waste treatment facilities, is initiated on or after\nJuly first, nineteen hundred sixty-six, and only for expenditures paid\nor incurred prior to January first, nineteen hundred seventy-two, or\nwhich, in the case of air pollution control facilities, is initiated on\nor after July first, nineteen hundred sixty-six, and\n  (B) on condition that such facilities have been certified by the state\ncommissioner of health or his designated representative, pursuant to the\nstate public health law, as complying with the provisions of the state\npublic health law, the state sanitary code and regulations, permits or\norders promulgated pursuant thereto, and\n  (C) on condition that for the taxable year and all succeeding taxable\nyears, any deductions allowed for federal income tax purposes for such\nexpenditures or for depreciation of the same property, except to the\nextent that its basis may be attributable to factors other than such\nexpenditures, be added to federal adjusted gross income pursuant to\nparagraph six of subdivision (b) of this section, or in case a\nmodification is allowable pursuant to this paragraph for only a part of\nsuch expenditures, on condition that a proportionate amount of any such\ndeductions allowed for federal income tax purposes be added to federal\nadjusted gross income, and\n  (D) where the election provided for in subdivision (g) of section\ntwelve has not been exercised in respect to the same property.\n  (3) (A) If expenditures in respect to an industrial waste treatment\nfacility or an air pollution control facility have been allowed as a\nmodification as provided herein and if within ten years from the end of\nthe taxable year in which such modification was allowed such property or\nany part thereof is used for the primary purpose of salvaging materials\nwhich are usable in the manufacturing process or are marketable, the\ntaxpayer shall report such change of use in its return for the first\ntaxable year during which it occurs, and the administrator may recompute\nthe tax for the year or years for which such modification was allowed,\nand may assess any additional tax resulting from such recomputation\nwithin the time fixed by paragraph eight of subdivision (c) of section\nsixty-three.\n  (B) If a modification is allowed as herein provided for expenditures\npaid or incurred during any taxable year on the basis of a temporary\ncertificate of compliance issued pursuant to the state public health\nlaw, and if the taxpayer fails to obtain a permanent certificate of\ncompliance upon completion of the facilities with respect to which such\ntemporary certificate was issued, the taxpayer shall report such failure\nin its report for the taxable year during which such facilities are\ncompleted, and the administrator may recompute the tax for the year or\nyears for which such modification was allowed, and may assess any\nadditional tax resulting from such recomputation within the time fixed\nby paragraph eight of subdivision (c) of section sixty-three.\n  (4) In any taxable year when property is sold or otherwise disposed\nof, with respect to which a modification has been allowed pursuant to\nthis paragraph, such modification shall be disregarded in computing gain\nor loss, and the gain or loss on the sale or other disposition of such\nproperty shall be the gain or loss entering into the computation of\nfederal adjusted gross income for such taxable year.\n