N.Y. Comp. Codes R. & Regs. tit. 20 § 139.3

Current through Register Vol. 46, No. 45, November 2, 2024

Section 139.3 - Modifications

Tax Law, § 639(a)(2)

(a) The applicable modifications, described in sections 112.2 and 112.3 of this Title, pertaining to items from New York State sources which enter into the definition of Federal distributable net income must, except as provided in subdivision (b) of this section, be combined into a single net figure. This figure, which may be a plus or minus figure, is termed net change. After this figure is computed, it is then allocated in the manner described in section 139.4 of this Part for allocating distributable net income from New York State sources. However, when a New York State item, which would give rise to a modification, has already been included in Federal distributable net income, no modification which would have the effect of duplicating the item is required to be made. (An example would be interest income received by an estate on State of California bonds, the basis for a modification under section 112.2(a) of this Title, where the bonds are assets of a New York State business which is continued by the executor of a nonresident decedent's estate.)

(b)Modifications not includible in net change.

Any modification, or portion thereof, described in subdivision (a) of this section relating to an item of income, gain, loss or deduction derived from New York State sources which enters into the definition of Federal distributable net income is not to be included in determining net change, under subdivision (a) of this section, if the item to which the modification pertains is paid or permanently set aside during the taxable year for a New York State charitable purpose pursuant to the terms of the governing instrument of the estate or trust. If a charitable organization is designated in the governing instrument as a distributee of a percentage or part of the estate or trust income, gain, loss or deduction, but not as the distributee of a particular item of income, gain, loss or deduction, the portion of such a modification to be excluded from the determination of net change is such proportion of the modification as the amount paid or payable to the charitable organization bears to the total income of the estate or trust. For purposes of this Part, New York State charitable purpose means contributions to the State of New York or any political subdivision thereof, or to any corporation, trust, community chest, fund, foundation or other entity organized or operated under the laws of New York State, which are allowed as deductions in computing Federal taxable income.

N.Y. Comp. Codes R. & Regs. Tit. 20 § 139.3