Can a New York S corporation doing business in Florida apportion income? The NY S corporation has no official offices in New York, but that is where the main member resides.

ANSWER

The BIDaWIZ Team's Answer:

The S Corporation may be able to apportion the income on the NY S Corp Franchise Tax Return via Form CT-3-S as NY is a single sales factor state. However, as a NY state resident, the client will still need to report all of their income from the business (whether from NY or other jurisdictions) on their individual NY state tax return. They would then file for a tax credit on their individual NY state return for taxes paid to other states on the same income.

If your question is solely on the NY S Corp Franchise Tax Return, the income may be apportioned based on the actual sales. If 60% of sales is from NY and 40% from Florida, report 60% on the NY S Corp Franchise tax return. This needs to be justified. In addition, it will still all be reported on the shareholder's NY state tax return.

References: New York Law Article 9-A
State(s): New York, Florida