Amd SS606 & 601, Tax L; add SS99-t & 99-u, St Fin L
Relates to creating the middle class circuit breaker tax credit; to amend the tax law, in relation to person income tax; to amend the state finance law, in relation to establishing the real property tax circuit breaker account and the education financing account; and directing the commissioner of taxation and finance to adjust certain withholding tables and methods.
STATE OF NEW YORK
________________________________________________________________________
7673
2011-2012 Regular Sessions
IN ASSEMBLY
May 12, 2011
___________
Introduced by M. of A. JAFFEE, JEFFRIES -- read once and referred to the
Committee on Ways and Means
AN ACT to amend the tax law, in relation to personal income tax; to
amend the state finance law, in relation to establishing the real
property tax circuit breaker account and the education financing
account; and directing the commissioner of taxation and finance to
adjust certain withholding tables and methods
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. Section 606 of the tax law is amended by adding a new
2 subsection (ss) to read as follows:
3 (ss) Middle class circuit breaker credit. (1) Definitions. For the
4 purposes of this subsection:
5 (A) "Qualified taxpayer" means a resident individual of the state who
6 owns or rents the residential real property in which he or she resides,
7 and has resided in such residential real property for not less than five
8 years. The department may require such proof as it deems necessary to
9 establish criteria sufficient to demonstrate that a taxpayer meets and
10 has met these qualifications for a period of at least five years.
11 Evidence of residence shall require the taxpayer to have resided on the
12 residential property at least one hundred ninety days a year and, unless
13 good cause is shown pursuant to a determination of the commissioner, to
14 have lived at such residence at least one hundred twenty days per year
15 consecutively for each of those years. Evidence may also include, but is
16 not limited to, driver's license, workplace location in comparison to
17 other property where such taxpayer may reside at or be domiciled at, and
18 voter registration status.
19 (B) "Household" or "members of the household" means a qualified
20 taxpayer or qualified taxpayers and all other persons, not necessarily
21 related, who all reside in the residential real property owned by the
22 taxpayer or taxpayers, and share its furnishings, facilities and accom-
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD10316-02-1
A. 7673 2
1 modations; provided that no person may be a member of more than one
2 household at one time.
3 (C) "Household gross income" means the aggregate adjusted gross income
4 of all members of the household for the taxable year as reported for
5 federal income tax purposes, or which would be reported as adjusted
6 gross income if a federal income tax return were required to be filed,
7 with the modifications in subsection (b) of section six hundred twelve
8 of this article but without the modifications in subsection (c) of such
9 section, plus any portion of the gain from the sale or exchange of prop-
10 erty otherwise excluded from such amount; earned income from sources
11 without the United States excludable from federal gross income by
12 section nine hundred eleven of the internal revenue code; support money
13 not included in adjusted gross income; nontaxable strike benefits;
14 supplemental security income payments; the gross amount of any pension
15 or annuity benefits to the extent not included in such adjusted gross
16 income (including, but not limited to, railroad retirement benefits and
17 all payments received under the federal social security act and veter-
18 ans' disability pensions); nontaxable interest received from the state
19 of New York, its agencies, instrumentalities, public corporations, or
20 political subdivisions (including a public corporation created pursuant
21 to agreement or compact with another state or Canada); workers' compen-
22 sation; the gross amount of "loss-of-time" insurance; and the amount of
23 cash public assistance and relief, other than medical assistance for the
24 needy, paid to or for the benefit of the qualified taxpayer or members
25 of his or her household. Household gross income shall not include
26 surplus foods or other relief in kind or payments made to individuals
27 because of their status as victims of Nazi persecution as defined in
28 public law 103-286 or any disability compensation received by veterans
29 on account of injury or illness incurred or aggravated during military
30 service in the wars in Afghanistan and Iraq since September eleventh,
31 two thousand one. Provided, further, household gross income shall only
32 include all such income received by all members of the household while
33 members of such household.
34 (D) "Adjusted rent" means rent paid for the right of occupancy of a
35 residence.
36 (E) "Real property tax equivalent" means for taxable years beginning
37 in two thousand twelve and thereafter, twenty percent of the adjusted
38 rent actually paid in the taxable year by a household solely for the
39 right of occupancy of its New York residence for the taxable year. If
40 (1) a residence is rented to two or more individuals as cotenants, or
41 such individuals share in the payment of a single rent for the right of
42 occupancy of such residence, and (2) each of such individuals is a
43 member of a different household, one or more of which individuals shares
44 such residence, real property tax equivalent is that portion of twenty
45 percent of the adjusted rent paid in the taxable year which reflects
46 that portion of the rent attributable to the qualified taxpayer and the
47 members of his or her household.
48 (F) "Net real property tax" means the real property taxes assessed on
49 the residential real property owned and occupied by the taxpayer or
50 taxpayers after any exemption or abatement received pursuant to the real
51 property tax law.
52 (2) Credit. A qualified taxpayer for the year two thousand twelve and
53 thereafter shall be allowed a credit against the taxes imposed by this
54 article equal to seventy percent, of the amount by which the taxpayer's
55 net real property tax or the taxpayer's real property tax equivalent
56 exceeds the taxpayer's maximum real property tax, as determined by para-
A. 7673 3
1 graph three of this subsection. If such credit exceeds the tax for such
2 taxable year, as reduced by the other credits permitted by this article,
3 the qualified taxpayer may receive, and the comptroller, subject to a
4 certificate of the department, shall pay as an overpayment, without
5 interest, any excess between such tax as so reduced and the amount of
6 the credit. If a qualified taxpayer is not required to file a return
7 pursuant to section six hundred fifty-one of this article, a qualified
8 taxpayer may nevertheless receive and the comptroller, subject to a
9 certificate of the department, shall pay as an overpayment the full
10 amount of the credit, without interest; provided, however, that there
11 shall be no obligation of the comptroller to pay such overpayment until
12 the revenue necessary to make such overpayment is in the account
13 provided for in section ninety-nine-t of the state finance law.
14 (3) Maximum real property tax. (A) A qualified taxpayer's maximum real
15 property tax shall be determined as follows:
16 For tax years beginning in two thousand twelve and thereafter:
17 Household gross incomeMaximum real property tax
18 One hundred thousandSix percent of household gross
19 dollars or lessincome
20 More than one hundred thousandSix percent of one hundred
21 dollars, but less than or equal tothousand dollars plus seven
22 one hundred fifty thousand dollarspercent of household gross income
23 above one hundred thousand dollars
24 More than one hundred fiftySix percent of one hundred thousand
25 thousand dollars, but less thandollars plus seven
26 or equal to two hundred fiftypercent of fifty thousand dollars
27 thousand dollarsplus eight and one-half percent of
28 household gross income above one
29 hundred fifty thousand dollars
30 More than two hundred fiftyNo limitation.
31 thousand dollars
32 (B) The thresholds of household gross income established by subpara-
33 graph (A) of this paragraph shall be indexed for inflation for tax years
34 beginning in two thousand fourteen and thereafter.
35 (4) Exclusions from eligibility. No credit shall be granted under this
36 subsection if the qualified taxpayer claims the real property tax
37 circuit breaker credit, pursuant to subsection (e) of this section,
38 during the taxable year.
39 § 2. Paragraph 1 of subsection (a) of section 601 of the tax law is
40 renumbered paragraph 1-a and a new paragraph 1 is added to read as
41 follows:
42 (1) For taxable years beginning in two thousand twelve and before two
43 thousand fourteen:
44 If the New York taxable income is:The tax is:
45 Not over $16,0004% of the New York taxable income
46 Over $16,000 but not over $22,000$640 plus 4.5% of excess over
47 $16,000
48 Over $22,000 but not over $26,000$910 plus 5.25% of excess over
49 $22,000
50 Over $26,000 but not over $40,000$1,120 plus 5.9% of excess over
51 $26,000
52 Over $40,000 but not over $1,000,000$1,946 plus 6.85% of excess over
53 $40,000
54 Over $1,000,000$67,706 plus 8.97% of excess over
55 $1,000,000
A. 7673 4
1 § 3. Paragraph 1 of subsection (b) of section 601 of the tax law is
2 renumbered paragraph 1-a and a new paragraph 1 is added to read as
3 follows:
4 (1) For taxable years beginning in two thousand twelve and before two
5 thousand fourteen:
6 If the New York taxable income is:The tax is:
7 Not over $11,0004% of the New York taxable income
8 Over $11,000 but not over $15,000$440 plus 4.5% of excess over
9 $11,000
10 Over $15,000 but not over $17,000$620 plus 5.25% of excess over
11 $15,000
12 Over $17,000 but not over $30,000$725 plus 5.9% of excess over
13 $17,000
14 Over $30,000 but not over $1,000,000$1,492 plus 6.85% of excess over
15 $30,000
16 Over $1,000,000$67,937 plus 8.97% of excess over
17 $1,000,000
18 § 4. Paragraph 1 of subsection (c) of section 601 of the tax law is
19 renumbered paragraph 1-a and a new paragraph 1 is added to read as
20 follows:
21 (1) For taxable years beginning in two thousand twelve and before two
22 thousand fourteen:
23 If the New York taxable income is:The tax is:
24 Not over $8,0004% of the New York taxable income
25 Over $8,000 but not over $11,000$320 plus 4.5% of excess over
26 $8,000
27 Over $11,000 but not over $13,000$455 plus 5.25% of excess over
28 $11,000
29 Over $13,000 but not over $20,000$560 plus 5.9% of excess over
30 $13,000
31 Over $20,000 but not over $1,000,000$973 plus 6.85% of excess over
32 $20,000
33 Over $1,000,000$68,103 plus 8.97% of excess over
34 $1,000,000
35 § 5. Subparagraphs (B) and (C) of paragraph 2 of subsection (d) of
36 section 601 of the tax law, as amended by section 2 of part Z1 of chap-
37 ter 57 of the laws of 2009, are amended to read as follows:
38 (B) For taxable years beginning after two thousand two and before two
39 thousand six, the fraction is computed as follows: the numerator is the
40 lesser of fifty thousand dollars or the excess of New York adjusted
41 gross income for the taxable year over one hundred fifty thousand
42 dollars and the denominator is fifty thousand dollars. For taxable years
43 beginning after two thousand eight and before two thousand twelve, the
44 fraction is computed as follows: the numerator is the lesser of fifty
45 thousand dollars or the excess of New York adjusted gross income for the
46 taxable year over three hundred thousand dollars and the denominator is
47 fifty thousand dollars. For taxable years beginning after two thousand
48 eleven and before two thousand fourteen, the fraction is computed as
49 follows: the numerator is the lesser of fifty thousand dollars or the
50 excess of New York adjusted gross income for the taxable year over one
51 million dollars and the denominator is fifty thousand dollars.
52 (C) This paragraph shall only apply to taxable years beginning after
53 two thousand two and before two thousand six and after two thousand
54 eight and before two thousand [twelve] fourteen.
A. 7673 5
1 § 6. Subparagraphs (B) and (C) of paragraph 3 of subsection (d) of
2 section 601 of the tax law, as amended by section 3 of part Z1 of chap-
3 ter 57 of the laws of 2009, are amended to read as follows:
4 (B) For such taxpayers with adjusted gross income over five hundred
5 thousand dollars, for taxable years beginning after two thousand eight
6 and before two thousand twelve, the fraction is computed as follows: the
7 numerator is the lesser of fifty thousand dollars or the excess of New
8 York adjusted gross income for the taxable year over five hundred thou-
9 sand dollars and the denominator is fifty thousand dollars. For such
10 taxpayers with adjusted gross income over one million dollars, for taxa-
11 ble years beginning after two thousand eleven and before two thousand
12 fourteen, the fraction is computed as follows: the numerator is the
13 lesser of fifty thousand dollars or the excess of New York adjusted
14 gross income for the taxable year over one million dollars and the
15 denominator is fifty thousand dollars. Provided, however, that the total
16 tax prior to the application of any tax credits shall not exceed the
17 highest rate of tax set forth in the tax table in subsection (a) of this
18 section multiplied by the taxpayer's taxable income.
19 (C) This paragraph shall only apply to taxable years beginning after
20 two thousand two and before two thousand six and after two thousand
21 eight and before two thousand [twelve] fourteen.
22 § 7. Notwithstanding any provision of law to the contrary, the method
23 of determining the amount to be deducted and withheld from wages on
24 account of taxes imposed by or pursuant to the authority of article 22
25 of the tax law in connection with the implementation of the provisions
26 of this act shall be prescribed by regulations of the commissioner of
27 taxation and finance with due consideration to the effect such withhold-
28 ing tables and methods would have on the receipt and amount of revenue.
29 The commissioner of taxation and finance shall adjust such withholding
30 tables and methods in regard to taxable years beginning in 2011 and
31 after in such manner as to result, so far as practicable, in withholding
32 from an employee's wages an amount substantially equivalent to the tax
33 reasonably estimated to be due for such taxable years as a result of the
34 provisions of this act. Provided, however, for tax year 2011 the with-
35 holding tables shall reflect as accurately as practicable the full
36 amount of tax year 2011 liability so that such amount is withheld by
37 December 31, 2011. Any such regulations to implement a change in with-
38 holding tables and methods for tax year 2011 shall be adopted and effec-
39 tive as soon as practicable and the commissioner of taxation and finance
40 may adopt such regulations on an emergency basis notwithstanding
41 anything to the contrary in section 202 of the state administrative
42 procedure act. In carrying out his or her duties and responsibilities
43 under this section, the commissioner of taxation and finance may accom-
44 pany such a rule making procedure with a similar procedure with respect
45 to the taxes required to be deducted and withheld by local laws imposing
46 taxes pursuant to the authority of articles 30, 30-A and 30-B of the tax
47 law, the provisions of any other law in relation to such a procedure to
48 the contrary notwithstanding.
49 § 8. 1. Notwithstanding any provision of law to the contrary, no addi-
50 tion to tax required shall be imposed for failure to pay the estimated
51 tax in subsection (c) of section 685 of the tax law with respect to any
52 underpayment of a required installment due prior to, or within thirty
53 days of, the effective date of this act to the extent that such under-
54 payment was created or increased by the amendments made by this act
55 provided, however, that the taxpayer remits the amount of the underpay-
56 ment with his or her next quarterly estimated tax payment.
A. 7673 6
1 2. The commissioner of taxation and finance shall take steps to publi-
2 cize the necessary adjustments to estimated tax and, to the extent
3 reasonably possible, to inform the taxpayer of the tax liability changes
4 made by this act.
5 § 9. The state finance law is amended by adding two new sections 99-t
6 and 99-u to read as follows:
7 § 99-t. Real property tax circuit breaker account. 1. There is hereby
8 established in the joint custody of the state comptroller and the
9 commissioner of taxation and finance an account of the miscellaneous
10 special revenue fund to be known as the real property tax circuit break-
11 er account.
12 2. Notwithstanding any other law, rule or regulation to the contrary,
13 the state comptroller is hereby authorized and directed to receive, on
14 and after January first, two thousand twelve, for deposit to the credit
15 of the real property tax circuit breaker account in the department of
16 taxation and finance, to be utilized to pay all costs associated with
17 the credit established by subsection (ss) of section six hundred six of
18 the tax law, that portion of personal income tax receipts which result
19 from the temporary surcharge on taxpayers with a New York state taxable
20 income in excess of one million dollars which are received after the
21 commencement of the two thousand twelve--two thousand thirteen state
22 fiscal year. Such surcharge shall be defined as the difference which
23 would be generated by taxable income over one million dollars when the
24 tax rate is 8.97% as compared to the amount such taxable revenue would
25 otherwise generate, at the rate provided for by law, effective January
26 first, two thousand fourteen. Such funds shall be expended for the
27 purpose of funding a real property tax circuit breaker credit, to
28 provide a state financed offset to such residential property taxes. If
29 the director of the division of the budget certifies that the receipts
30 which result from the temporary surcharge as set forth in this section
31 shall exceed the amount necessary for the state to meet the obligations
32 provided for under subsection (ss) of section six hundred six of the tax
33 law, such excess amount as determined by the director of the budget, and
34 as otherwise certified to be available by the state comptroller, shall
35 be allocated to the public schools of the state in the formula utilized
36 by the legislature to establish the total foundation base aid, as
37 defined by section thirty-six hundred two of the education law.
38 § 99-u. Education financing account. 1. There is hereby established in
39 the joint custody of the state comptroller and the commissioner of taxa-
40 tion and finance an account of the miscellaneous special revenue fund to
41 be known as the education financing account.
42 2. Notwithstanding any other law, rule or regulation to the contrary,
43 the state comptroller is hereby authorized and directed to receive, on
44 and after January first, two thousand twelve, for deposit to the credit
45 of the education financing account in the state education department any
46 amount of tax receipts from the real property tax circuit breaker
47 account under section ninety-nine-t of this article which are determined
48 by the director of the budget to be in excess of the amounts necessary
49 for the state to meet the obligations provided for under subsection (ss)
50 of section six hundred six of the tax law, as set forth in subdivision
51 two of section ninety-nine-t of this article.
52 § 10. This act shall take effect immediately.
