NEW YORK STATE ASSEMBLY MEMORANDUM IN SUPPORT OF LEGISLATION submitted in accordance with Assembly Rule III, Sec 1(f)
BILL NUMBER: A1756A
SPONSOR: Jones (MS) TITLE OF BILL:
An act to amend the tax law, in relation to creating a tax credit for
employers who reduce the governmental education loans of their employees
PURPOSE:
This bill would create a tax credit for employers who assist their
employees in paying back their government education loans that they
received during their time as a student.
SUMMARY OF PROVISIONS:
Section 1 amends the tax law by adding a new subdivision that allows a
taxpayer a credit if it provides for a payment, on behalf of an employ-
ee, of any debt that the employee owes under a governmental education
loan or any interest relating to such loan.
Section 2 amends paragraph 1 of subsection (i) of section 606 of the tax
law by adding a new clause
Section 3 amends section 606 of the tax law by adding two new
subsections, (hbh) which would create an employee indebtedness reduction
credit, and (iii) which would create an employer education loan
reduction credit.
Section 4 contains the effective date.
JUSTIFICATION:
Governmental loans not only put financial strain on those who carry
them, but also mental and physical stress that could lead to serious
issues. This bill provides an incentive for employers to help relieve
some of their employee's financial burdens, via governmental loans,
while receiving benefits for doing so. This legislation would also open
up the job market for those who have governmental loans because they
will have an incentive to work for potential companies and organizations
that would be willing to pay their loans. Employers could use this not
only as a form of recruitment but as a retention strategy for skilled
employees.
LEGISLATIVE HISTORY:
01/15/19 referred to ways and means
01/08/20 referred to ways and means
01/06/21 referred to ways and means
01/05/22 referred to ways and means
01/26/22 amend and recommit to ways and means
01/26/22 print number
FISCAL IMPLICATIONS:
To be determined.
EFFECTIVE DATE:
This act shall take effect immediately and apply to taxable years begin-
ning on and after the first of January next
STATE OF NEW YORK
________________________________________________________________________
1756--A
2023-2024 Regular Sessions
IN ASSEMBLY
January 20, 2023
___________
Introduced by M. of A. JONES, COLTON, DICKENS, WALLACE, WILLIAMS,
RIVERA, MORINELLO, BLANKENBUSH, HEVESI, CARROLL -- Multi-Sponsored by
-- M. of A. SIMON -- read once and referred to the Committee on Ways
and Means -- committee discharged, bill amended, ordered reprinted as
amended and recommitted to said committee
AN ACT to amend the tax law, in relation to creating a tax credit for
employers who reduce the governmental education loans of their employ-
ees
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. Section 210-B of the tax law is amended by adding a new
2 subdivision 59 to read as follows:
3 59. Employee indebtedness reduction credit. (a) Allowance of credit. A
4 taxpayer shall be allowed a credit, to be computed as provided in para-
5 graph (b) of this subdivision, against the tax imposed by this article,
6 if it provides for a payment, on behalf of an employee, of any indebt-
7 edness of the employee under a governmental education loan or any inter-
8 est relating to such a loan. For purposes of this subdivision, "govern-
9 mental education loan" shall mean any education loan debt, including
10 judgments, owed to the federal or New York state government or any other
11 institution.
12 (b) Amount of credit. The credit allowed pursuant to paragraph (a) of
13 this subdivision shall be in an amount equal to the taxpayer's payment,
14 on behalf of an employee, of any indebtedness of the employee under a
15 governmental education loan or any interest relating to such a loan.
16 Provided, however, that no such credit allowed under this subdivision
17 shall exceed ten thousand dollars for each employee employed by such
18 employer.
19 (c) Application of credit. The credit allowed under this subdivision
20 for any taxable year shall not reduce the tax due for such year to less
21 than the amount prescribed in paragraph (d) of subdivision one of
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD02267-03-3
A. 1756--A 2
1 section two hundred ten of this article. If, however, the amount of
2 credits allowed under this subdivision for any taxable year reduces the
3 tax to such amount, any amount of credit thus not deductible in such
4 taxable year shall be treated as an overpayment of tax to be credited or
5 refunded in accordance with the provisions of section one thousand
6 eighty-six of this chapter. Provided, however, the provisions of
7 subsection (c) of section one thousand eighty-eight of this chapter
8 notwithstanding, no interest shall be paid thereon.
9 § 2. Subparagraph (B) of paragraph 1 of subsection (i) of section 606
10 of the tax law is amended by adding a new clause (l) to read as follows:
11 (l) Employee indebtednessAmount of credit
12 reduction creditunder subdivision
13 under subsection (ooo)fifty-nine of section
14 two hundred ten-B
15 § 3. Section 606 of the tax law is amended by adding a new subsection
16 (ooo) to read as follows:
17 (ooo) Employee indebtedness reduction credit. (1) Allowance of credit.
18 A taxpayer shall be allowed a credit, to be computed as provided in
19 paragraph two of this subsection, against the tax imposed by this arti-
20 cle, if it provides for a payment, on behalf of an employee, of any
21 indebtedness of the employee under a governmental education loan or any
22 interest relating to such a loan. For purposes of this subsection,
23 "governmental education loan" shall mean any education loan debt,
24 including judgments, owed to the federal or New York state government or
25 any other institution.
26 (2) Amount of credit. The credit allowed pursuant to paragraph one of
27 this subsection shall be in an amount equal to the taxpayer's payment,
28 on behalf of an employee, of any indebtedness of the employee under a
29 governmental education loan or any interest relating to such a loan.
30 Provided, however, that no such credit allowed under this subsection
31 shall exceed ten thousand dollars for each employee employed by such
32 employer.
33 (3) Application of credit. If the amount of the credit allowed under
34 this subsection for any taxable year shall exceed the taxpayer's tax for
35 such year, the excess shall be treated as an overpayment of tax to be
36 credited or refunded in accordance with the provisions of section six
37 hundred eighty-six of this article, provided, however, that no interest
38 shall be paid thereon.
39 § 4. This act shall take effect immediately and apply to taxable years
40 beginning on and after the first of January next succeeding the date on
41 which it shall have become a law.
