2023 New York Laws › TAX - Tax › Article 22 - Personal Income Tax › Part 3 - Nonresidents and Part-Year Residents › 631 - New York Source Income of a Nonresident Individual.

§  631.  New  York  source  income  of  a  nonresident individual. (a)
General.  The New York source income of a nonresident  individual  shall
be  the  sum  of  the  following: (1) The net amount of items of income,
gain, loss and  deduction  entering  into  his  federal  adjusted  gross
income,  as  defined  in  the  laws of the United States for the taxable
year, derived from or connected with New York  sources,  including:  (A)
his  distributive share of partnership income, gain, loss and deduction,
determined under section six hundred thirty-two, and
(B) his pro rata share of New York  S  corporation  income,  loss  and
deduction, increased by reductions for taxes described in paragraphs two
and three of subsection (f) of section thirteen hundred sixty-six of the
internal  revenue code, determined under section six hundred thirty-two,
and
(C) his share of estate or trust income,  gain,  loss  and  deduction,
determined under section six hundred thirty-four and
(2)  The portion of the modifications described in subsections (b) and
(c) of section six hundred twelve which relate to  income  derived  from
New  York  sources (including any modifications attributable to him as a
partner or shareholder of a New York S corporation).
(b) Income and deductions from New York sources.
(1) Items  of  income,  gain,  loss  and  deduction  derived  from  or
connected with New York sources shall be those items attributable to:
(A)  the  ownership  of  any  interest  in  real  or tangible personal
property in this state; or
(1) For purposes of this subparagraph, the term "real property located
in this state" includes an interest in a partnership, limited  liability
corporation,  S  corporation,  or non-publicly traded C corporation with
one hundred or fewer shareholders (hereinafter the "entity")  that  owns
real  property  that is located in New York or owns shares of stock in a
cooperative housing corporation where the cooperative units relating  to
the  shares  are located in New York; provided, that the sum of the fair
market values of such real property,  cooperative  shares,  and  related
cooperative  units  equals or exceeds fifty percent of all the assets of
the entity on the date of sale or exchange of the taxpayer's interest in
the entity. Only those assets that the entity owned  for  at  least  two
years before the date of the sale or exchange of the taxpayer's interest
in the entity are to be used in determining the fair market value of all
the  assets  of  the entity on the date of sale or exchange. The gain or
loss derived from New York sources from the taxpayer's sale or  exchange
of  an  interest  in an entity that is subject to the provisions of this
subparagraph is the total gain or loss for federal income  tax  purposes
from  that  sale  or exchange multiplied by a fraction, the numerator of
which is the fair market value of the real property, and the cooperative
housing corporation stock and related cooperative units located  in  New
York on the date of sale or exchange and the denominator of which is the
fair market value of all the assets of the entity on the date of sale or
exchange.
(B)  a  business,  trade,  profession or occupation carried on in this
state; or
(C) in the case of  a  shareholder  of  an  S  corporation  where  the
election  provided for in subsection (a) of section six hundred sixty of
this article is in effect,  the  ownership  of  shares  issued  by  such
corporation,   to  the  extent  determined  under  section  six  hundred
thirty-two of this article; or
(D) winnings from a  wager  placed  in  a  lottery  conducted  by  the
division  of  the  lottery,  if the proceeds from such wager exceed five
thousand dollars; or
(D-1) gambling winnings  in  excess  of  five  thousand  dollars  from
wagering transactions within the state; or
(E)  gains from the sale, conveyance or other disposition of shares of
stock in a cooperative housing corporation in connection with the  grant
or  transfer of a proprietary leasehold by the owner thereof and subject
to the provisions of article thirty-one of this  chapter,  whether  such
shares are held by a partnership, trust or otherwise; or
(E-1)  in  the  case  of  an S corporation for which an election is in
effect pursuant to subsection (a) of section six hundred sixty  of  this
article  that  terminates  its taxable status in New York, any income or
gain recognized on the receipt of  payments  from  an  installment  sale
contract  entered  into when the S corporation was subject to tax in New
York, allocated in a manner consistent with the applicable  methods  and
rules for allocation under article nine-A or thirty-two of this chapter,
in the year that the S corporation sold its assets.
(F)  income  received  by  nonresidents  related to a business, trade,
profession or occupation previously carried on in this state, whether or
not as an employee, including but  not  limited  to,  covenants  not  to
compete  and  termination  agreements.  Income  received by nonresidents
related to  a  business,  trade,  profession  or  occupation  previously
carried on partly within and partly without the state shall be allocated
in accordance with the provisions of subsection (c) of this section.
(2)  Income  from  intangible  personal property, including annuities,
dividends, interest,  and  gains  from  the  disposition  of  intangible
personal property, shall constitute income derived from New York sources
only  to  the  extent  that  such  income is from property employed in a
business, trade, profession, or occupation carried on in this  state  or
from winnings from a wager placed in a lottery conducted by the division
of  the  lottery,  if  the proceeds from such wager exceed five thousand
dollars. Income from the disposition  of  intangible  personal  property
shall also constitute income derived from New York sources to the extent
such  gains are from the sale, conveyance or other disposition of shares
of stock in a cooperative housing corporation  in  connection  with  the
grant  or  transfer  of a proprietary leasehold by the owner thereof and
subject to the provisions of article thirty-one of this chapter, whether
such shares are held by a partnership, trust or otherwise.
(3) Income directly or indirectly derived by an athlete,  entertainer,
or   performing   artist   from   closed-circuit  and  cable  television
transmissions of an event (other than events occurring  on  a  regularly
scheduled  basis)  taking  place  within  the  state  as a result of the
rendition of services by such athlete, entertainer or performing  artist
shall constitute income derived from New York sources only to the extent
that such transmissions were received or exhibited within the state.
(4) Deductions with respect to capital losses, passive activity losses
and net operating losses shall be based solely on income, gain, loss and
deduction  derived  from  or  connected  with  New  York  sources, under
regulations of the commissioner of taxation and finance,  but  otherwise
shall  be  determined  in  the  same manner as the corresponding federal
deductions.
(5)  In  the  case  of  a  nonresident  individual  or  partner  of  a
partnership  doing  an  insurance  business  as a member of the New York
insurance exchange described in section six thousand two hundred one  of
the  insurance  law, any item of income, gain, loss or deduction of such
business which is the individual's distributive or pro  rata  share  for
federal  income tax purposes or which the individual is required to take
into account separately for  federal  income  tax  purposes,  shall  not
constitute  income,  gain,  loss  or  deduction  derived  from  New York
sources.
(6) The deduction allowed  by  section  two  hundred  fifteen  of  the
internal  revenue  code,  relating  to  alimony,  shall not constitute a
deduction derived from New York sources.
(c) Income and deductions partly from New York sources. If a business,
trade,  profession  or occupation is carried on partly within and partly
without  this  state,  as  determined  under  regulations  of  the   tax
commission,  the  items of income, gain, loss and deduction derived from
or connected with New York sources shall be determined by  apportionment
and allocation under such regulations.
(d)  Purchase  and sale for own account.-- A nonresident, other than a
dealer holding property primarily for sale to customers in the  ordinary
course  of  his  trade  or  business,  shall not be deemed to carry on a
business, trade, profession or occupation in this state solely by reason
of the purchase and sale of property or the purchase, sale or writing of
stock option contracts, or both, for his own account.
(e) Military pay. Compensation paid by the United  States  for  active
service  in  the  armed  forces  of  the  United States, performed by an
individual not domiciled in this  state,  shall  not  constitute  income
derived from New York sources.
(f)  Husband  and  wife.  If  husband and wife determine their federal
income tax on a joint return but are required  to  determine  their  New
York income taxes separately, they shall determine their New York source
incomes  separately  as if their federal adjusted gross incomes had been
determined separately.
(g) Stock option grants,  stock  appreciation  rights  and  restricted
stock.    A  nonresident  taxpayer  who has been granted statutory stock
options,  restricted  stock,  nonstatutory  stock   options   or   stock
appreciation rights and who, during such grant period, performs services
within  New York for, or is employed within New York by, the corporation
granting such option, stock or right, shall compute his or her New  York
source  income  as  determined under rules and regulations prescribed by
the commissioner.