Installment sales

In the case of an asset sale where the proceeds of the sale are received by the seller on an installment basis as provided for in IRC section 453, the portion of the receipts or gains attributable to New York must be determined in the year of the sale by applying the apportionment rules in section 210-A and this Subchapter.
The same ratio of New York receipts to everywhere receipts from the installment income for each type of asset shall be used in subsequent years to determine how much of the installment payment is included in New York receipts. The entire amount of the annual installment is included in everywhere receipts.
(a) Example.
Corporation C sells its building in New York in the 2021 tax year and has a $5,000,000 gain. It has no other sales of real property. Under the sales agreement, the proceeds of the sale will be paid to Corporation C in 5 equal annual installments. As the real property is located in New York, the entire gain is attributable to New York and $1,000,000 is included in New York receipts and everywhere receipts each year.
In tax year 2021, besides the installment gain, Corporation C has $20,000,000 of rental income from its New York property and $5,000,000 of rental income from real property located outside New York.
Corporation C has $21,000,000 of New York receipts ($1,000,000 of the gain from the New York real estate installment sale and $20,000,000 of rental income from the New York property) and $26,000,000 of everywhere receipts ($1,000,000 of the gain from the real estate installment sale and $25,000,000 of rental income from real property located within and without New York State). Its BAF for the 2021 tax year is 0.807692.
In tax year 2022, beside the installment gain, Corporation C has only $2,000,000 of rental income from real property located outside of New
York. Corporation C has $1,000,000 of New York receipts (its second installment of the gain from New York real property) and $3,000,000 of everywhere receipts ($1,000,000 of its second installment of gains from the sale of real property plus $2,000,000 of rental income from real property located outside New York State). Its BAF for the 2022 tax year is 0.333333.