Question

Form IT-225 NYS Additions to New York Resident Income Tax Return Form IT-201-Possible Program Error

Forum|Forum|5 years ago
January 18, 2021
1 reply
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Hello,

I'm a president of a NY S Corporation, I have to attach form IT-225 to my personal State Tax return IT-201 to show and pay additions to my NYS income. I do believe, that as a 100% shareholder/one owner of the S Corporation I have to use Schedule A , Part 1, Line 1a and input code A-201 and amount. Unfortunately, when I'm trying to input the amount and mark the box "NYS allocated amount of above" I'm getting an error and the amount turns red. I do believe, that If I'm working and conducting business in NYS I should show what part of my business and how much of it is allocated in NYS. The allocated NYS amount, BOX B stays blank, but should be equal the total amount-BOX A, if all of my business is done in NYS. Is this an error? I can't override it, because I won't be able to e file my return. I'm hoping that a tax pro, who understands NYS taxes, would know what I'm talking about.

LenaH

The apportionment of NYS income for a S Corporation is done on the tax forms for the business, specifically the CT-3-S - Part 3. Shareholders pay New York tax on their pro rata share (in your case 100%) of the S corporation pass-through items of income, gain, loss, and deduction that are includable in their federal adjusted gross income. Only nonresident shareholders and part-year resident shareholders pay tax solely on the S corporation items derived from New York sources, which is determined at the corporate level.

However, since you are a NYS resident, your K-1 will have pass-through items that are 100% derived from NYS. In this case, you should not need any adjustments on your NYS return.

If you need to make manual adjustments, the A-201 adjustment is entered under the TurboTax screen Changes to Federal Income.

You can get to this screen by following these steps in TurboTax:

Open your return.
Click on state on the left hand side.
Click continue through your interview questions until you get to the page Changes to Federal Income.
Scroll down and go to Start under Partner, shareholder and beneficiary adjustments.
You can enter any additions on the screen Enter Any Partner, Shareholder and Beneficiary Additions. Your input should list the modification code and amount.
You can also then list Any Partner, Shareholder and Beneficiary Subtractions on the following page.

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ParkNYCAuthor

Hi Lenah, thank you for the professional response. I think I was confused and forgot, that as a full time resident my allocated NYS amount would be automatically 100%, so there is no need to show allocated amount. My question is, I have not received K-1 NY equivalent form, but as a sole officer/shareholder and 100% stock owner I'd have to include (addition) my share of NY franchise taxes imposed under Article 9-A (general business corporation franchise tax) and deducted from federal income. This amount can be found on Form CT-34-SH (New York S Corporation Shareholders’ Information Schedule), Schedule A, Part 1, Line 1 which in my case is $25. Should I use code A-201 or A-301 for this amount? As far as I know A-301 would affect ex C corporations. My corporation is a Federal and NY S Corporation and never was a C corporation. Thank you and appreciate your time.