1. (a) Except for corporations principally engaged in the conduct of aviation or in the conduct of a railroad or trucking business, a taxpayer allocates its entire net income by the business allocation percentage, determined pursuant to Subparts 4-2 through 4-6 of this Part, in the following cases:

   1. (1) if it has only business income; or
   2. (2) if it has business income and investment loss.

2. (b) A taxpayer allocates its entire net income by the investment allocation percentage (see: Subpart 4-7 of this Part) in the following cases:

   1. (1) if it has only investment income; or
   2. (2) if it has investment income and a business loss.

3. (c) Any taxpayer which has both business income and investment income, allocates its entire net income by using both the business allocation percentage and the investment allocation percentage, as follows:

   1. (1) multiply the business income by the business allocation percentage; and
   2. (2) multiply the investment income by the investment allocation percentage; and
   3. (3) add the products computed in paragraphs (1) and (2) of this subdivision. The sum computed in paragraph (3) of this subdivision is the portion of the taxpayer's entire net income allocated to New York State. Thus, the taxpayer's entire net income is the sum of its business income and its investment income. If a net operating loss deduction is allowed in computing entire net income (see: Subpart 3-8 of this Title—Net Operating Loss Deduction), such deduction must be apportioned between business income and investment income before multiplying business income and investment income by the appropriate allocation percentage (see: section 4-8.5 of this Subpart).
4. (d) When the investment allocation percentage is zero, interest received on bank accounts is multiplied by the business allocation percentage.

Tax Law, §§ 171, 208(6); 210(3)