624. Computation of separate tax on the ordinary income portion of lump sum distributions received by resident individuals, estates and trusts. (a) Amount of separate tax. The amount of tax imposed under section six hundred three for any taxable year, with respect to the ordinary income portion of a lump sum distribution received by a resident individual, estate or trust is an amount equal to five times the tax which would be imposed by subsection (c) of section six hundred one if the recipient of such lump sum distribution were an individual referred to in such subsection and the New York taxable income were an amount equal to one-fifth of the excess of:
(1) the total taxable amount of the lump sum distribution for the taxable year, over
(2) the minimum distribution allowance.
(b) Minimum distribution allowance. For purposes of this section, the minimum distribution allowance shall be that which is calculated according to subparagraph (C) of paragraph one of subsection (e) of section four hundred two of the internal revenue code.
(c) Multiple distributions and distributions of annuity contracts. For purposes of this section, the rules concerning multiple distributions and distributions of annuity contracts as specified by paragraph two of subsection (e) of section four hundred two of the internal revenue code shall be applicable, except that references to "paragraph (1) (A)" shall be deemed to be references to this section, and except that only lump sum distributions (or portions thereof) and distributions of annuity contracts subject to tax under this article shall be included, and except that references to the secretary shall be deemed to be references to the tax commission.
(d) Definitions and special rules. For purposes of this section, the following provisions shall apply, to the extent applicable to the taxpayer's federal tax on lump sum distributions: (1) the definitions and special rules as specified in paragraph four of subsection (e) of section four hundred two of the internal revenue code; and (2) the special rules relating to (A) individuals who have attained the age of fifty before January first, nineteen hundred eighty-six and (B) capital gains, as specified in paragraphs three, four, five and six of subsection (h) of section eleven hundred twenty-two of the tax reform act of nineteen hundred eighty-six as enacted by public law 99-514, but (i) in the event that paragraph three of such subsection is applicable, clause (ii) of subparagraph (B) of such paragraph shall be applied using a rate of five and four-tenths percent, and (ii) in the event that paragraph five of such subsection is applicable, the words "five" and "one-fifth" in subsection (a) of this section shall be read as "ten" and "one-tenth", respectively, and subsection (a) of this section shall be applied by using the rate of tax specified in subsection (f) of section six hundred two as such subsection was in effect for taxable years beginning in nineteen hundred eighty-six.
Last modified: February 3, 2019