N.Y. Tax Law § 620-a: Credit against separate tax

§ 620-A. Credit against separate tax. (a) General. A resident shall be

allowed a credit against the separate tax otherwise due under section

six hundred three for any income tax imposed for the taxable year by

another state of the United States, a political subdivision of such

state, the District of Columbia or a province of Canada, upon the

ordinary income portion (or part thereof) of a lump sum distribution

both derived therefrom and subject to tax under such section. Where such

ordinary income portion (or part thereof) of a lump sum distribution is

not subject to separate income taxation by such other state or its

political subdivision or the District of Columbia or a province of

Canada, but is included as income under an income tax imposed by such

jurisdiction, the portion of the tax on such income which constitutes

the income tax imposed on such ordinary income portion (or part thereof)

of a lump sum distribution shall be an amount bearing the same ratio to

the entire tax paid to such other jurisdiction as the amount of the

ordinary income portion (or part thereof) of a lump sum distribution

included in the income subject to such tax bears to all income subject

to such tax.

(b) Limitations. (1) The credit under this section shall not exceed

the percentage of the tax otherwise due under section six hundred three

determined by dividing the portion of the taxpayer's ordinary income

portion of a lump sum distribution taxable both under section six

hundred three and by such other jurisdiction by the total amount of the

taxpayer's ordinary income portion of a lump sum distribution taxable

under section six hundred three.

(2) The credit under this section shall not reduce the tax otherwise

due under section six hundred three to an amount less than would have

been due if the portion of the ordinary income portion of a lump sum

distribution taxable both under section six hundred three and by such

other jurisdiction were excluded from the computation of the separate

tax imposed under section six hundred three.

(3) In the case of a taxpayer who elects to claim the foreign tax

credit for federal income tax purposes, the credit under this section

for income tax imposed by a province of Canada shall be allowed for that

portion of the provincial tax not claimed for federal purposes for the

taxable year or a preceding taxable year, provided however, to the

extent the provincial tax is claimed for federal purposes for a

succeeding taxable year, the credit under this section must be added

back in such succeeding taxable year. The provincial tax shall be deemed

to be claimed last for federal income tax purposes and for purposes of

this subsection.