I know this topic was touched on here a few years ago, but with NYS's higher income rates for 2023, I thought I might present an actual case to illustrate the importance of managing annual income for taxpayers who have some control over timing.
Consider this example of a New York State tax resident:
Filing Status: Single
AGI: $1,220, 383
Standard Deduction: $8,000
TI: $1,212,383
NYS Income Tax: $116, 995, which is an effective tax rate of 9.65% on all income. At first, I thought TurboTax's calculation could not be right, but reviewing the NYS tax computation tables more closely reveals that as soon as one's income exceeds the prior rate bracket by $50,000, all of your income gets taxed at the next highest marginal rate. That's pretty painful.
For example, the first $50,000 of AGI over $1,077,550 is taxed at a 60.34% marginal rate. Yikes!!