The order of the Appellate Division should be reversed, with costs, and the determination of the Tax Commission reinstated.
*918The full amount of capital gain realized from the sale was included in petitioners’ adjusted gross income on their Federal income tax return for 1974 and thus was properly reported on their New York State income tax return for that year (Tax Law, § 612). Although the Federal Government allowed the petitioners a partial refund in 1977 under the “claim of right” doctrine, that had no effect on their Federal adjusted gross income for 1974 (US Code, tit 26, § 1341) and there is no corresponding refund provision in the New York statute. Consequently, no mistake within the meaning of section 697 of the Tax Law was made on petitioners’ 1974 New York State income tax return. Any inequity which may result from the dissimilarity between the Federal and State statutes is a consequence of the present statutory scheme and is not a matter within the authority of the judiciary to correct.
Chief Judge Cooke and Judges Jasen, Jones, Wachtler, Meyer, Simons and Kaye concur in memorandum.