IT-230: Separate Tax on Lump-Sum Distributions (2024)
New York · NY DTF · Used for tax years 2024
Form IT-230 figures the separate New York State and New York City tax on lump-sum distributions using information from federal Form 4972. It includes calculations for the capital gain portion and the 10-year tax option and is submitted with Form IT-201, IT-203, or IT-205.
Who files this form
Submit Form IT-230 if you used federal Form 4972 to figure your federal tax on lump-sum distributions. Submit it with Form IT-201, IT-203, or IT-205, along with a copy of federal Form 4972.
- New York State residents: Complete all of Form IT-230 using information from federal Form 4972, following the directions for each part.
- Part-year residents: Complete Part 2 using federal Form 4972. For Part 3, use only the information for your period of New York residence.
- Nonresidents: Complete only Part 2, line 1, and the Income percentage schedule on page 3 of Form IT-230-I.
If you did not use federal Form 4972, do not complete the rest of Form IT-230. Your distribution does not qualify for this separate tax.
What you'll need
- Federal Form 4972: Use its figures to complete Form IT-230 and submit a copy with your return.
- Form IT-201, IT-203, or IT-205: Submit Form IT-230 with the return that applies to you.
- Form IT-230-I: Form IT-230 refers to its worksheets, Income percentage schedule, and tax rate schedules. The tax rate schedules on page 4 are needed for the 10-year tax option.
- Other forms, when applicable: The form directs individuals to report the Part 3 tax on Form IT-201-ATT or IT-203-ATT. It also refers to Form IT-360.1 for part-year New York City residents and Form IT-205-A for certain estates or trusts.
How to file
Submit Form IT-230 and a copy of federal Form 4972 with Form IT-201, IT-203, or IT-205. Enter your name as shown on your return and your identification number.
Complete Part 2 if you completed Part II of federal Form 4972. Complete Part 3 if you were a resident or part-year resident and completed Part III of federal Form 4972. Follow the residency-specific directions and transfer the calculated amounts to the forms or worksheets listed on Form IT-230.
The provided form text does not give a mailing address or e-filing directions.
Common mistakes
- Including amounts outside your residency period: Part-year residents must use only the federal Form 4972 information for their New York residence period in Part 3.
- Missing the New York City column: New York City and part-year New York City residents must use both columns where directed.
- Ignoring the line 7 skip rule: If line 7 is $70,000 or more, skip lines 8 through 11 and enter the line 7 amount on line 12.
- Exceeding the line 8 limit: Do not enter more than $10,000 on line 8.
- Missing the annuity skip rules: If line 6 is blank, skip lines 15 through 17 and go to line 18. Also skip lines 21 through 23 and enter the line 20 amount on line 24.
Questions people ask
Can I use Form IT-230 if I did not use federal Form 4972?
No. The form says your distribution does not qualify for the separate tax and tells you not to complete the rest of the form.
Which rates apply to the capital gain part in Part 2?
Multiply line 1 by 5.4% for the New York State column. New York City and part-year New York City residents also multiply line 1 by 1.72% for the New York City column.
Where do I report the New York State tax from line 24?
Individuals enter it on Form IT-201-ATT, line 26, or Form IT-203-ATT, line 25. Fiduciaries include it on Form IT-205, line 12. Multiple recipients should follow the separate worksheet directions if applicable.
What if the lump-sum distribution had multiple recipients?
The form directs you to the front page of the instructions and, if applicable, the Multiple recipients of lump-sum distribution worksheet. That worksheet multiplies the line 24 tax by your percentage of the total distribution.