Enacts the medical malpractice insurance premium credit act; provides a tax credit for a percentage of medical malpractice premiums paid by such taxpayer; defines relevant terms.
STATE OF NEW YORK
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581
2011-2012 Regular Sessions
IN SENATE(Prefiled)
January 5, 2011
___________
Introduced by Sens. KLEIN, STEWART-COUSINS, VALESKY -- read twice and
ordered printed, and when printed to be committed to the Committee on
Investigations and Government Operations
AN ACT to amend the tax law, in relation to enacting the medical malp-
ractice insurance premiums credit act
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. Short title. This act shall be known and may be cited as
2 the "medical malpractice insurance premiums credit act".
3 § 2. Section 210 of the tax law is amended by adding a new subdivision
4 25-b to read as follows:
5 25-b. Credit for medical malpractice insurance premiums. (a) As used
6 in this subdivision, the following terms shall have the following mean-
7 ings:
8 (1) "Medical malpractice insurance" means insurance against legal
9 liability of the insured, and against loss, damage or expense incident
10 to a claim of such liability arising out of the death or injury of any
11 person due to medical, dental, podiatric, certified nurse-midwifery or
12 hospital malpractice by any licensed physician, dentist, podiatrist,
13 certified nurse-midwife, certified registered nurse anesthetist or
14 hospital.
15 (2) "Qualified premiums" shall include all premiums paid by the
16 taxpayer during the current tax year on all medical malpractice insur-
17 ance policies whose premiums are regulated and established by the insur-
18 ance department with the exception of premiums paid for excess medical
19 malpractice insurance coverage provided pursuant to chapter two hundred
20 sixty-six of the laws of nineteen hundred eighty-six, as amended.
21 (3) "Qualified income" shall include all net receipts the taxpayer
22 derives from activities covered by the malpractice policy for which the
23 qualified premiums are paid.
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD04441-01-1
S. 581 2
1 (b) A taxpayer shall be allowed a credit against the tax imposed by
2 this article equal to twenty-five percent of the amount by which annual
3 qualified premiums exceed ten percent of the taxpayer's qualified income
4 for the current year, not to exceed the lesser of the taxpayer's current
5 year tax liability or twenty-five thousand dollars. The credit shall be
6 claimed after the allowance of all other credits provided by this chap-
7 ter.
8 (c) The credit allowed under this subdivision for any year shall not
9 reduce the tax due for such year to less than the higher of the amounts
10 prescribed in paragraphs (c) and (d) of subdivision one of this section.
11 If, however, the amount of credit allowable under this subdivision for
12 any taxable year reduces the tax to such amount, any amount of credit
13 not deductible in such taxable year may be carried over to the following
14 year or years and may be deducted from the taxpayer's tax for such year
15 or years.
16 (d) For the purposes of this subdivision a taxpayer may include a
17 partnership, a corporation that has made an election under subchapter S
18 of chapter one of subtitle A of the Internal Revenue Code, or any other
19 business entity through which income flows as a distributive share to
20 its owners. A credit received under this subdivision by a partnership,
21 S-corporation, or other such business entity shall be apportioned among
22 the persons to whom the income or profit of the partnership, S-corpora-
23 tion, or other entity is distributed, in the same proportions as those
24 in which the income or profit is distributed.
25 § 3. Subparagraph (B) of paragraph 1 of subsection (i) of section 606
26 of the tax law is amended by adding a new clause (xxxii) to read as
27 follows:
28 (xxxii) Medical malpracticeQualified premiums under
29 insurance premiums creditsubdivision twenty-five-b
30 under subsection (ss)of section two hundred ten
31 § 4. Section 606 of the tax law is amended by adding a new subsection
32 (ss) to read as follows:
33 (ss) Medical malpractice insurance premiums tax credit. (1) As used in
34 this subsection, the following terms shall have the following meanings:
35 (A) "Medical malpractice insurance" means insurance against legal
36 liability of the insured, and against loss, damage or expense incident
37 to a claim of such liability arising out of the death or injury of any
38 person due to medical, dental, podiatric, certified nurse-midwifery or
39 hospital malpractice by any licensed physician, dentist, podiatrist,
40 certified nurse-midwife, certified registered nurse anesthetist or
41 hospital.
42 (B) "Qualified premiums" shall include all premiums paid by the
43 taxpayer during the current tax year on all medical malpractice insur-
44 ance policies whose premiums are regulated and established by the insur-
45 ance department with the exception of premiums paid for excess medical
46 malpractice insurance coverage provided pursuant to chapter two hundred
47 sixty-six of the laws of nineteen hundred eighty-six, as amended.
48 (C) "Qualified income" shall include all net receipts the taxpayer
49 derives from activities covered by the malpractice policy for which the
50 qualified premiums are paid.
51 (2) A taxpayer shall be allowed a credit against the tax imposed by
52 this article equal to twenty-five percent of the amount by which annual
53 qualified premiums exceed ten percent of the taxpayer's qualified income
54 for the current year, not to exceed the lesser of the taxpayer's current
55 year tax liability or twenty-five thousand dollars. The credit shall be
S. 581 3
1 claimed after the allowance of all other credits provided by this chap-
2 ter.
3 (3) Any amount of credit not deductible in a taxable year may be
4 carried over to the following year or years and may be deducted from the
5 taxpayer's tax for such year or years.
6 (4) For the purposes of this subsection a taxpayer may include a part-
7 nership, a corporation that has made an election under subchapter S of
8 chapter one of subtitle A of the Internal Revenue Code, or any other
9 business entity through which income flows as a distributive share to
10 its owners. A credit received under this subsection by a partnership,
11 S-corporation, or other such business entity shall be apportioned among
12 the persons to whom the income or profit of the partnership, S-corpora-
13 tion, or other entity is distributed, in the same proportions as those
14 in which the income or profit is distributed.
15 § 5. This act shall take effect immediately and shall apply to taxable
16 years commencing on or after January 1, 2011 through December 31, 2020.
