BILL NO A01522
SAME AS No same as
SPONSOR Cahill (MS)
COSPNSR
MLTSPNSR Clark, 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.
BILL NUMBER:A1522
TITLE OF BILL: An act to amend the labor law, in relation to
liability 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
Liability 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
documentation indicates that such a company most resembles a sole
proprietorship, New York State currently holds a single-member LLC
liable for unemployment 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.
S T A T E O F N E W Y O R K
________________________________________________________________________
1522
2015-2016 Regular Sessions
I N A S S E M B L Y
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 S 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
