Enacts a tax exemption for capital gains on the sales of new businesses and the initial public offerings of the stock of new businesses that are located in New York.
STATE OF NEW YORK
________________________________________________________________________
5627
2011-2012 Regular Sessions
IN ASSEMBLY
February 24, 2011
___________
Introduced by M. of A. MURRAY -- read once and referred to the Committee
on Ways and Means
AN ACT to amend the tax law, in relation to establishing the capital
gains modification
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. Section 612 of the tax law is amended by adding a new
2 subsection (w) to read as follows:
3 (w) Capital gains modification.
4 1. For the purposes of this subsection, the following definitions
5 shall apply:
6 (A) "capital gain" means the gain or profits realized from the sale of
7 any new company, as that term is defined by subparagraph (C) of this
8 paragraph, or the gain from the initial public offering of stock by
9 early-stage investors or company founders of any new company.
10 (B) "liquidity event" means the sale of a new company or the initial
11 public offering of stock of any new company.
12 (C) "new company" means any corporation or partnership organized or
13 formed under the laws of New York state after January first, two thou-
14 sand twelve and located therein. Any corporation or partnership shall
15 cease to qualify for the exemption provided for in this subsection if,
16 before the liquidity event, as that term is defined by subparagraph (B)
17 of this paragraph, the principal place of business of such corporation
18 or partnership moves out of New York state.
19 2. The taxpayer may subtract from his or her federal adjusted gross
20 income any capital gains as defined by subparagraph (A) of paragraph one
21 of this subsection (but not an amount that will reduce the portion of
22 such gain included in his or her New York income below zero).
23 § 2. This act shall take effect January 1, 2012, provided, however
24 that effective immediately, the department may prescribe such rules and
25 regulations as may be necessary to carry out the purposes of this act.
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD08382-01-1
