2023 New York Laws › TAX - Tax › Article 22 - Personal Income Tax › Part 3 - Nonresidents and Part-Year Residents › 634 - Share of a Nonresident Beneficiary in Income From New York Sources.

§  634.  Share  of  a  nonresident beneficiary in income from New York
sources. (a) General. The share of  a  nonresident  beneficiary  of  any
estate  or trust under subsection (a) of section six hundred thirty-one,
in estate or trust income,  gain,  loss  and  deduction  from  New  York
sources shall be determined as follows:
(1)  Items  of  distributable net income from New York sources.  There
shall be determined the items  of  income,  gain,  loss  and  deduction,
derived  from  or  connected with New York sources, which enter into the
definition of federal distributable net income of the  estate  or  trust
for  the taxable year (including such items from another estate or trust
of which the first estate or trust is a beneficiary). Such determination
of source shall be made in  accordance  with  the  applicable  rules  of
section  six  hundred  thirty-one  as  in  the  case  of  a  nonresident
individual.
(2) Addition or subtraction of modifications. There shall be added  or
subtracted  (as  the case may be) the modifications described in section
six hundred eighteen, to the extent relating to  the  items  of  income,
gain, loss and deduction derived from or connected with New York sources
as  determined  under  paragraph one of this subsection. No modification
shall be made under this subsection which has the effect of  duplicating
an item already reflected in the definition of federal distributable net
income.
(3)  Allocation  among beneficiaries. (A) The amounts determined under
paragraphs one and two shall be allocated among the  beneficiaries  (and
including,  solely  for the purpose of this allocation, among the estate
or trust and resident beneficiaries) in proportion to  their  respective
shares of federal distributable net income.
(B)  The amounts so allocated shall have the same character under this
article as for federal income tax purposes.  Where an item entering into
the computation of such amounts is not characterized for federal  income
tax  purposes,  it shall have the same character as if realized directly
from the source from which realized by the estate or trust, or  incurred
in the same manner as incurred by the estate or trust.
(b) Alternate methods of determining shares.
(1) If the estate or trust has no federal distributable net income for
the  taxable  year, the share of each beneficiary (including, solely for
the purpose of this  allocation,  resident  beneficiaries)  in  the  net
amount  determined  under paragraphs one and two of subsection (a) shall
be in proportion to the beneficiary's  share  of  the  estate  or  trust
income for such year, under local law or the governing instrument, which
is  required  to  be distributed currently and any other amounts of such
income distributed in such year. Any balance of such net amount shall be
allocated to the estate or trust.
(2) The commissioner may by regulation establish such other method  or
methods of determining the respective shares of the beneficiaries and of
the  estate or trust in its income derived from New York sources, and in
the modifications related thereto, as may be appropriate and  equitable.
Such  method may be used by the fiduciary in his discretion whenever the
allocation of such respective shares under subsection (a)  or  paragraph
one  of  subsection (b) would result in an inequity which is substantial
both in amount and in relation to the total amount of the  modifications
referred to in paragraph two of subsection (a).