Section 17. Resident partners

--(a) Partner's modifications.--In determining
  city  adjusted  gross  income  and  city  taxable  income  of a resident
  partner, any modification described in subdivisions (b), (c) or  (d)  of
  section  twelve, subdivision (c) of section fifteen or paragraphs two or
  three of subdivision (d) of such section, which relates to  an  item  of
  partnership  income, gain, loss or deduction shall be made in accordance
  with the partner's distributive share, for federal income tax  purposes,
  of  the  item  to  which  the  modification relates.   Where a partner's
  distributive share of any such item is not required  to  be  taken  into
  account  separately  for  federal  income  tax  purposes,  the partner's
  distributive share of such item shall be determined in  accordance  with
  his  distributive share, for federal income tax purposes, of partnership
  taxable income or loss generally.
    (b) Character of items.--Each item of partnership income, gain,  loss,
  or  deduction  shall  have  the  same character for a partner under this
  local law as for federal income tax  purposes.  Where  an  item  is  not
  characterized  for  federal  income tax purposes, it shall have the same
  character for a partner as if realized directly  from  the  source  from
  which  realized  by  the  partnership  or incurred in the same manner as
  incurred by the partnership.
    (c) City tax avoidance or  evasion.--Where  a  partner's  distributive
  share  of  an  item  of  partnership  income, gain, loss or deduction is
  determined for federal income tax purposes by special provision  in  the
  partnership agreement with respect to such item, and where the principal
  purpose  of such provision is the avoidance or evasion of tax under this
  local law, the partner's  distributive  share  of  such  item,  and  any
  modification  required  with  respect thereto, shall be determined as if
  the partnership agreement made no special provision with respect to such
  item.