New York Codes, Rules and Regulations › Title 20 - DEPARTMENT OF TAXATION AND FINANCE › Chapter II - Income Taxes and Estate Taxes › Subchapter A - New York State Personal Income Tax Under Article 22 Of The Tax Law › Article 3 - Nonresidents › Part 132 - New York Adjusted Gross Income of a Nonresident Individual › Methods of Allocating Income and Deductions from Sources Within and Without New York State › Section 132.21 - Special rules for security and commodity brokers

Current through Register Vol. 46, No. 28, July 10, 2024
(a) For taxable years beginning on or after
						January 1, 1978, security and commodity brokers doing business both within and
						without New York State, as determined under section
						132.14 
						of this Part, may elect to allocate the income from such business in accordance
						with the provisions of section
						132.15(c) 
						of this Part. The election must be made by the due date, including any
						extensions, of the time to file a New York State nonresident personal income
						tax return for the first taxable year beginning on or after January 1, 1978. A
						taxpayer who fails to make a timely election under this section must use the
						allocation method prescribed by section
						132.15(b) 
						of this Part. Once the taxpayer uses the method prescribed by section
						132.15(b) 
						of this Part, or elects to allocate in accordance with subdivision (c) of such
						section, the taxpayer must continue to use the allocation method implemented
						unless, after application in writing to the Tax Commission, the Tax Commission
						determines that the method of allocation used no longer reflects income which
						is fairly applicable to New York State. If the Tax Commission permits the
						taxpayer to revoke the method of allocation of income under this section, a
						copy of such permission of revocation of election must be attached to the New
						York State nonresident personal income tax return for the first taxable period
						to which such revocation of election is applicable.
(b) In any method of apportionment and
						allocation permitted or required under section
						132.15 
						of this Part, the commissions derived from the execution of purchase or sales
						orders for the account of customers must be allocated and apportioned as
						follows:
(1) If an order is received at the
						New York State place of business of a broker for execution on an exchange
						located within New York State, and originates at a bona fide established office
						of the broker located within New York State, 100 percent of the commission in
						the case of stocks, bonds and commodities must be apportioned and allocated to
						New York State and constitutes income derived from or connected with New York
						State sources in the taxable period in which such order is executed.
(2) If the order is received at the New York
						State place of business of a broker for execution on an exchange located within
						New York State, and originates at a bona fide established office of the broker
						located without New York State, 20 percent of the commission in the case of
						stocks, bonds and commodities must be apportioned and allocated to New York
						State and constitutes income derived from or connected with New York State
						sources in the taxable period in which such order is executed.
(3) If the order originates at the New York
						State place of business of a broker and is transmitted to a bona fide
						established office of the broker located without New York State for execution
						on an exchange located without New York State, 80 percent of the commission in
						the case of stocks, bonds and commodities must be apportioned and allocated to
						New York State and constitutes income derived from or connected with New York
						State sources in the taxable period in which such order is executed.
(4) For taxable periods commencing on and
						after January 1, 1978, the taxpayer may allocate commission income on the basis
						of actual experience if such taxpayer can demonstrate to the satisfaction of
						the Tax Commission that the allocation pursuant to paragraphs (2) and (3) of
						this subdivision does not fairly reflect the amount of commission income
						attributable to New York State.
(5)
						Commission income derived from over-the-counter transactions must be
						apportioned and allocated to New York State in the following manner:
(i) If the order originates at or through a
						New York State place of business of the taxpayer, 100 percent of the commission
						income must be apportioned and allocated to New York State.
(ii) If the order originates at or through a
						bona fide established office of the taxpayer located outside New York State, no
						portion of the commission income is attributable to New York State.