STATE OF NEW YORK
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4401--A
2017-2018 Regular Sessions
IN SENATE
February 13, 2017
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Introduced by Sen. TEDISCO -- read twice and ordered printed, and when
printed to be committed to the Committee on Investigations and Govern-
ment Operations -- recommitted to the Committee on Investigations and
Government Operations in accordance with Senate Rule 6, sec. 8 --
committee discharged, bill amended, ordered reprinted as amended and
recommitted to said committee
AN ACT to amend the tax law, in relation to establishing a tax credit
for low income individuals subject to the federal self-employment tax
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. Legislative intent. The legislature recognizes the need to
2 alleviate the tax burden of low income individual taxpayers whose income
3 is largely derived from self-employment and therefore affected by feder-
4 al self-employment taxes to a degree disproportionate with such taxpay-
5 ers' level of disposable income. This circumstance hinders many newly
6 started businesses in the state. Therefore, this act provides a state-
7 level credit to provide relief to these taxpayers.
8 § 2. Section 606 of the tax law is amended by adding a new subsection
9 (ccc) to read as follows:
10 (ccc) Self-employed taxpayer credit. (1) General. A qualified self-
11 employed taxpayer shall be allowed a credit against the tax imposed by
12 this article equal to twenty-five percent of his or her federal self-em-
13 ployment tax liability for the year, but not exceeding a maximum amount
14 of five hundred dollars, and subject to phase-out as provided under
15 paragraph three of this subsection.
16 (2) Definition of "qualified self-employed taxpayer". A qualified
17 self-employed taxpayer is an individual taxpayer, whose federal gross
18 income for the tax year is below forty thousand dollars, and whose busi-
19 ness income in the year is an amount of at least seventy percent of his
20 or her federal gross income. Business entities shall not be qualified.
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD06364-02-8
S. 4401--A 2
1 (3) Maximum credit phase-out. The maximum allowed credit of five
2 hundred dollars shall be reduced dollar for dollar for each dollar
3 beyond thirty-nine thousand five hundred dollars of federal gross
4 income, such that the credit is completely phased out upon reaching
5 forty thousand dollars of federal gross income.
6 § 3. This act shall take effect immediately and shall apply to taxable
7 years beginning on or after January 1, 2019.
