Thanks for the answer, at least got an confirmation from an expert to say that is the way it is, instead of me understanding the form wrong.
I understand home state has the right to tax everything, then to give proportional tax credit for income tax paid to other states. Considering NY is not the home state, and the tax concept is NY taxes nonresident only on income from NY source, and the NY income is clearly isolated on page 1, form 203 really should carry over NY income instead of Fed income to page 2.
In current way, non NY income is used to push the total income to higher bracket. Even with the reduction by proportion, NY state still gets more tax money from nonresidents.
Thanks again ThomasM125.
