A01522 Summary:

BILL NOA01522
 
SAME ASNo Same As
 
SPONSORCahill
 
COSPNSR
 
MLTSPNSRColton, Cook, Rivera
 
Amd S512, Lab L
 
Relates to the liability of certain limited liability companies and partnerships, those which are less than two persons, for the purposes of unemployment insurance.
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A01522 Memo:

NEW YORK STATE ASSEMBLY
MEMORANDUM IN SUPPORT OF LEGISLATION
submitted in accordance with Assembly Rule III, Sec 1(f)
 
BILL NUMBER: A1522
 
SPONSOR: Cahill (MS)
  TITLE OF BILL: An act to amend the labor law, in relation to liabil- ity under the unemployment insurance law of certain limited liability partnerships and companies   PURPOSE OR GENERAL IDEA OF BILL: The legislation creates a statutory distinction between Limited Liabil- ity Companies and "Single Member" Limited Liability Companies, by formally adding LLCs to the definition of "employer" under Unemployment Insurance provisions and requiring that such companies shall not include those which are less than two persons.   SUMMARY OF SPECIFIC PROVISIONS: The bill adds a new Subdivision 2-a to Article 18, Section 512 of the Labor Law, creating the above distinction.   JUSTIFICATION: This bill seeks to encourage small business growth by eliminating a loophole in the Insurance Law which creates an unnecessary tax on Single-Member Limited Liability Companies. In an instance where a sole proprietor chooses to develop his or her own innovative business solutions, it is often beneficial for such a person to reorganize as a single-member limited liability company. While available tax documenta- tion indicates that such a company most resembles a sole proprietorship, New York State currently holds a single-member LLC liable for unemploy- ment taxes, even though there is currently nothing in statute which specifically addresses the single-member LLC. This creates a situation where, if such business owner employs a spouse under current law, the company must pay unemployment insurance on the spouse. This tax is excessive, especially given that the single-member LLC is not required to pay federal unemployment tax.   LEGISLATIVE HISTORY: 2013-2014 A.1597 Referred to Labor 2011-2012 A.98 Referred to Labor 2009-2010 A.596 Referred to Labor 2007-2008 A.4788 Referred to Labor 2005-2006 A.5742 Referred to Labor 2003-2004 A.295 Referred to Labor 2001-2002 referred to labor   FISCAL IMPLICATIONS: None.   EFFECTIVE DATE: This act shall take effect immediately.
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A01522 Text:



 
                STATE OF NEW YORK
        ________________________________________________________________________
 
                                          1522
 
                               2015-2016 Regular Sessions
 
                   IN ASSEMBLY
 
                                    January 12, 2015
                                       ___________
 
        Introduced  by  M. of A. CAHILL -- Multi-Sponsored by -- M. of A. CLARK,
          COLTON, COOK, RIVERA -- read once and referred  to  the  Committee  on
          Labor
 
        AN  ACT to amend the labor law, in relation to liability under the unem-
          ployment insurance law of certain limited liability  partnerships  and
          companies
 
          The  People of the State of New York, represented in Senate and Assem-
        bly, do enact as follows:
 
     1    Section 1. Section 512 of the labor law is amended  by  adding  a  new
     2  subdivision 2-a to read as follows:
     3    2-a.  For the purposes of this article, the term "employer" includes a
     4  partner of a registered limited  liability  partnership  as  defined  in
     5  section  two  of  the  partnership  law, a member of a limited liability
     6  company as defined in subdivision (m) of section one hundred two of  the
     7  limited  liability  company  law  or  a member of a professional service
     8  limited liability company as  defined  in  subdivision  (f)  of  section
     9  twelve  hundred  one  of  the  limited  liability company law; provided,
    10  however, that such limited liability partnerships  and  companies  shall
    11  not include those which are less than two persons.
    12    § 2. This act shall take effect immediately.
 
 
 
 
         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD06244-01-5
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