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A06868 Summary:

BILL NOA06868
 
SAME ASSAME AS S08685
 
SPONSORAlvarez
 
COSPNSR
 
MLTSPNSR
 
Amd 606, Tax L
 
Establishes a tax credit for rent paid on the personal residence of certain taxpayers who lease the taxpayer's primary residence during the taxable year and who pay rent with respect to such residence in excess of thirty percent of such taxpayer's gross income for such taxable year whose income is less than fifty percent of the area median income.
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A06868 Actions:

BILL NOA06868
 
05/08/2023referred to ways and means
01/03/2024referred to ways and means
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A06868 Memo:

NEW YORK STATE ASSEMBLY
MEMORANDUM IN SUPPORT OF LEGISLATION
submitted in accordance with Assembly Rule III, Sec 1(f)
 
BILL NUMBER: A6868
 
SPONSOR: Alvarez
  TITLE OF BILL: An act to amend the tax law, in relation to establishing a tax credit for rent paid on the personal residence of certain taxpayers   PURPOSE: To increase housing stability with regard to compensating renters that pay over the threshold of 30% of their gross income by establishing a tax credit for those who make less than 50% of the area median income.   SUMMARY OF SPECIFIC REVISIONS: N/A   JUSTIFICATION: As the issue of housing stability in New York increases, renters are met with the inevitable burden of providing and maintaining adequate housing for their families. Reports find that the average New Yorker is spending over 62% of their income on rent. This bare minimum expense is wiping out more than half of the income of New York residents. Establishing a tax credit for those spending over 30% of annual income on rent would allow room for financial growth within low-income communi- ties which have fallen victim to rent hikes and other factors leading to elevated rent in these areas. A credit meant to reimburse individuals for rent paid over 30% of income allows for financial freedom which will prove to be beneficial in terms of general maintenance on property, adding more value to the individual property and the community as well. Allowing this tax credit will federalize the issue, leading to coordi- nation amongst rental assistance programs that are run locally. Since 2010, New York has seen a rent increase of up to 35%.. This bill proposes that those who's income is less than 50% of the median income of the area will be given the credit.   FISCAL IMPLICATIONS: N/A   EFFECTIVE DATE: This act shall take effect immediately.
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A06868 Text:



 
                STATE OF NEW YORK
        ________________________________________________________________________
 
                                          6868
 
                               2023-2024 Regular Sessions
 
                   IN ASSEMBLY
 
                                       May 8, 2023
                                       ___________
 
        Introduced  by M. of A. ALVAREZ -- read once and referred to the Commit-
          tee on Ways and Means
 
        AN ACT to amend the tax law, in relation to establishing  a  tax  credit
          for rent paid on the personal residence of certain taxpayers
 
          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 (bbb) to read as follows:
     3    (bbb) Rent relief credit. (1) Allowance of credit. A qualified taxpay-
     4  er shall be allowed a credit to be computed as provided in paragraph two
     5  of this subsection against the tax imposed by this article.
     6    (2)  Computation  of credit.  The credit allowed under this subsection
     7  shall be one hundred percent of the excess  of  thirty  percent  of  the
     8  taxpayer's gross income such taxpayer pays in rent for such taxable year
     9  for taxpayers whose income is less than fifty percent of the area median
    10  income.
    11    (3) Advance payments. (A) The commissioner shall establish a mechanism
    12  by  which  a  qualified taxpayer may apply for an advance payment of the
    13  credit authorized by this subsection, provided that:
    14    (i) A qualified taxpayer who fails to apply for an advance payment  of
    15  such  credit  by  the date on which the commissioner requires, may apply
    16  for and receive such credit in the manner prescribed by the  commission-
    17  er, provided that such application shall be made within three years from
    18  the  time  that a return for the taxable year would have had to be filed
    19  pursuant to section six hundred fifty-one of this article. If  approved,
    20  such  payment  shall  be  issued  as  soon  as  is practicable after the
    21  submission of the application but shall not be subject to the processing
    22  schedule prescribed by subparagraph (B) of this paragraph, and
    23    (ii) A qualified taxpayer who has applied for an  advance  payment  of
    24  such  credit  in  a  taxable  year  may continue to receive such advance
 
         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD10472-01-3

        A. 6868                             2
 
     1  payments in future taxable years without reapplying as long as he or she
     2  remains eligible therefor.
     3    (B)  The commissioner shall determine the eligibility of taxpayers for
     4  this credit utilizing  the  information  available  to  him  or  her  as
     5  obtained  from the applications submitted and from such other sources as
     6  the commissioner deems reliable and  appropriate.  For  those  taxpayers
     7  whom  the  commissioner  has  determined  eligible  for this credit, the
     8  commissioner shall advance a payment of up to  one  half  of  the  total
     9  amount of the total credit owed.
    10    (C) A taxpayer who has failed to receive an advance payment that he or
    11  she  believes  was  due  to  him  or her, or who has received an advance
    12  payment that he or she believes is less than the amount that was due  to
    13  him  or  her,  may request payment of the claimed deficiency in a manner
    14  prescribed by the commissioner.
    15    (D) An advance payment of credit provided pursuant to this  subsection
    16  that exceeds the taxpayer's qualifying taxes for that taxable year shall
    17  be added back as tax on the income tax return for that taxable year.
    18    (E)  If  the  commissioner determines after issuing an advance payment
    19  that it was issued in an excessive amount or to an ineligible or  incor-
    20  rect  party,  the  commissioner shall be empowered to utilize any of the
    21  procedures for collection, levy and lien  of  personal  income  tax  set
    22  forth  in  this article, any other relevant procedures referenced within
    23  the provisions of this article, and any other law as may be  applicable,
    24  to recoup the improperly issued amount.
    25    (4)  Limitation  on  amount of credit. For the purposes of determining
    26  the amount of the credit allowed under this subsection, with respect  to
    27  a  primary residence for the taxable year, there shall not be taken into
    28  account rent in excess of an amount equal to one hundred  fifty  percent
    29  of  the fair market rent, including the utility allowance, applicable to
    30  such residence, as most recently published, as of the beginning  of  the
    31  taxable  year,  by  the  United  States  department of housing and urban
    32  development.
    33    (5) Application of credit. If the amount of the credit  allowed  under
    34  this subsection for any taxable year shall exceed the taxpayer's tax for
    35  such  year,  the  excess shall be treated as an overpayment of tax to be
    36  credited or refunded in accordance with the provisions  of  section  six
    37  hundred  eighty-six of this article, provided, however, that no interest
    38  shall be paid thereon.
    39    (6) Administration. The  commissioner  shall  have  the  authority  to
    40  promulgate  such rules and regulations as may be necessary for the proc-
    41  essing, determination and granting of credits under this subsection.
    42    (7) Definitions. As used in this subsection, the following terms shall
    43  have the following meanings:
    44    (A) "Qualified taxpayer" shall mean an individual who leases the indi-
    45  vidual's primary residence during the taxable year, who pays  rent  with
    46  respect to such residence and whose income is less than fifty percent of
    47  the area median income.
    48    (B) "Rent" shall include any amount paid for utilities.
    49    (C)  "Gross  income" shall mean the federal adjusted gross income of a
    50  taxpayer.
    51    § 2. This act shall take effect on the first of January next  succeed-
    52  ing  the  date  on  which it shall have become a law, and shall apply to
    53  taxable years commencing on and after such date.  Effective immediately,
    54  the addition, amendment and/or repeal of any rule or  regulation  neces-
    55  sary  for  the  implementation  of  this  act  on its effective date are
    56  authorized to be made and completed on or before such effective date.
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