A01522 Summary:
| BILL NO | A01522 |
| SAME AS | No Same As |
| SPONSOR | Cahill |
| COSPNSR | |
| MLTSPNSR | Colton, 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. | |
A01522 Memo:
Go to topNEW YORK STATE ASSEMBLY
MEMORANDUM IN SUPPORT OF LEGISLATION
submitted in accordance with Assembly Rule III, Sec 1(f)
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.
A01522 Text:
Go to topSTATE 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