S01680 Summary:

BILL NOS01680
 
SAME ASNo Same As
 
SPONSORHINCHEY
 
COSPNSRKRUEGER, WEIK
 
MLTSPNSR
 
Add §48, amd §§210-B & 606, Tax L; amd §16, Ag & Mkts L
 
Provides a tax credit for sales or rentals of agricultural assets to beginning farmers; requires the commissioner of agriculture and markets to implement a plan for certification of eligible taxpayers with respect thereto.
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S01680 Actions:

BILL NOS01680
 
01/13/2023REFERRED TO INVESTIGATIONS AND GOVERNMENT OPERATIONS
01/03/2024REFERRED TO INVESTIGATIONS AND GOVERNMENT OPERATIONS
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S01680 Committee Votes:

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S01680 Floor Votes:

There are no votes for this bill in this legislative session.
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S01680 Text:



 
                STATE OF NEW YORK
        ________________________________________________________________________
 
                                          1680
 
                               2023-2024 Regular Sessions
 
                    IN SENATE
 
                                    January 13, 2023
                                       ___________
 
        Introduced  by Sens. HINCHEY, KRUEGER -- read twice and ordered printed,
          and when printed to be committed to the  Committee  on  Investigations
          and Government Operations
 
        AN  ACT  to amend the tax law, in relation to providing a tax credit for
          sales or rentals of agricultural assets to beginning farmers;  and  to
          amend  the  agriculture  and  markets law, in relation to establishing
          duties of the commissioner of agriculture  and  markets  with  respect
          thereto
 
          The  People of the State of New York, represented in Senate and Assem-
        bly, do enact as follows:
 
     1    Section 1. This act shall be known and may be cited as the  "New  York
     2  farmland preservation act".
     3    §  2.  The  tax  law  is amended by adding a new section 48 to read as
     4  follows:
     5    § 48. Credit for owners of agricultural assets. (a) General. A taxpay-
     6  er that has been  certified  by  the  commissioner  of  agriculture  and
     7  markets  as  a  certified owner of agricultural assets shall be eligible
     8  for a credit against the tax imposed under article nine-A or  twenty-two
     9  of this chapter, pursuant to the provisions referenced in this section.
    10    (b)  Definitions.  For  purposes  of this section, the following terms
    11  shall have the following meanings:
    12    (1) "Agricultural assets" shall  mean  agricultural  land,  livestock,
    13  facilities, buildings, or machinery used for farming.
    14    (2) "Beginning farmer" means a resident of New York who:
    15    (i)  is  seeking entry, or has entered within the last ten years, into
    16  farming;
    17    (ii) intends to farm land located within  the  state  borders  of  New
    18  York;
    19    (iii) is not related by blood or marriage to the owner of the agricul-
    20  tural  assets  from  whom the beginning farmer is seeking to purchase or
    21  rent agricultural assets;

         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD05315-01-3

        S. 1680                             2
 
     1    (iv) is not related by blood or marriage to a partner, member,  share-
     2  holder,  or  trustee  of  the owner of agricultural assets from whom the
     3  beginning farmer is seeking to purchase or rent agricultural assets;
     4    (v)  intends  to provide the majority of the day-to-day physical labor
     5  or management of the farm; and
     6    (vi) meets the eligibility requirements for certification as a  begin-
     7  ning  farmer  as  determined  by  the  commissioner  of  agriculture and
     8  markets.
     9    (3) "Socially disadvantaged beginning farmer" means a farmer who is  a
    10  member  of  a  socially  disadvantaged group and meets the definition of
    11  beginning farmer as defined in section twelve hundred  eighty-five-r  of
    12  the public authorities law.
    13    (4)  "Socially  disadvantaged  group" means a group whose members have
    14  been subjected to racial, ethnic, or gender prejudice because  of  their
    15  identity as members of a group without regard to their individual quali-
    16  ties. These groups include all of the following:
    17    (i) African Americans;
    18    (ii) Native Indians;
    19    (iii) Alaskan Natives;
    20    (iv) Hispanics;
    21    (v) Asian Americans; and
    22    (vi) Native Hawaiians and Pacific Islanders.
    23    (5) "Farm product" shall have the same meaning as crops, livestock and
    24  livestock  products  as  defined  in  subdivision  two  of section three
    25  hundred one of the agriculture and markets law.
    26    (6) "Farming" means the active use, management, and operation of  real
    27  and personal property for the production of a farm product.
    28    (7)  "Owner  of agricultural assets" means an individual, trust, part-
    29  nership, or business entity that:
    30    (i) is the owner in fee of agricultural land or has legal title to any
    31  other agricultural asset;
    32    (ii) is a New York state resident;
    33    (iii) derived at least fifty percent  of  the  individual's,  trust's,
    34  partnership's or business entity's gross income from farming in at least
    35  five of the preceding fifteen years; and
    36    (iv)  provided  the  majority  of  the  day-to-day  physical labor and
    37  management of a farm in at least five of the  preceding  fifteen  years.
    38  If  the  owner  is  a  partnership  or business entity, the requirements
    39  outlined in subparagraphs (i), (ii), (iii) and (iv)  of  this  paragraph
    40  shall  be  satisfied if any partner or shareowner, or any combination of
    41  the two, meet the requirements of this paragraph.
    42    (8) "Rental agreement" means a rental agreement in which the principal
    43  consideration given to the owner of agricultural assets is  a  predeter-
    44  mined portion of the production of farm products produced from the rent-
    45  ed  agricultural  assets and which provides for sharing production costs
    46  or risk of loss, or both.
    47    (c) Computation of credit. (1) An owner  of  agricultural  assets  may
    48  take  a credit for the sale or rental of agricultural assets to a begin-
    49  ning farmer.  The credit shall be equal to the greater of:
    50    (i) five percent of the sale price of the agricultural asset;
    51    (ii) ten percent of the gross rental income  in  each  of  the  first,
    52  second, and third years of a rental agreement; or
    53    (iii)  fifteen  percent  of  the  cash  equivalent of the gross rental
    54  income in each of the first, second, and third years of a rental  agree-
    55  ment.

        S. 1680                             3
 
     1    (2)  An owner of agricultural assets may take an additional credit for
     2  the sale or rental of agricultural assets to  a  socially  disadvantaged
     3  beginning  farmer.  The  additional  credit  shall be the credit applied
     4  under paragraph one of this subdivision plus an additional two and  one-
     5  half percent.
     6    (3)  A  qualifying rental agreement includes cash rent of agricultural
     7  assets or a rental agreement. The agricultural asset must be  rented  at
     8  prevailing community rates as determined by the commissioner of agricul-
     9  ture. The credit may be claimed only after approval and certification by
    10  the commissioner of agriculture and markets.
    11    (4)  An owner of agricultural assets or beginning farmer may terminate
    12  a rental agreement, for reasonable cause. Within fifteen days, the owner
    13  of agricultural assets must notify the commissioner  of  agriculture  in
    14  writing of such termination. If a rental agreement is terminated without
    15  the fault of the owner of agricultural assets, the tax credits shall not
    16  be retroactively disallowed. If an agreement is terminated with fault by
    17  the  owner  of  agricultural assets, any prior tax credits claimed under
    18  this subdivision by the owner of agricultural assets shall be disallowed
    19  and must be repaid to the commissioner of taxation and finance.
    20    (d) Cross-references. For application of the credit  provided  for  in
    21  this section, see the following provisions of this chapter:
    22    (1) article 9-A: section 210-B: subdivision 59.
    23    (2) article 22: section 606: subsections (i) and (ooo).
    24    §  3. Section 210-B of the tax law is amended by adding a new subdivi-
    25  sion 59 to read as follows:
    26    59. Tax credit for owners of agricultural  assets.  (a)  Allowance  of
    27  credit. A taxpayer shall be allowed a credit, to be computed as provided
    28  in  section forty-eight of this chapter, against the tax imposed by this
    29  article.
    30    (b) Application of credit. The credit allowed under  this  subdivision
    31  for  any  taxable  year may not reduce the tax due for such year to less
    32  than the amount prescribed  in  paragraph  (d)  of  subdivision  one  of
    33  section two hundred ten of this article. However, if the amount of cred-
    34  it  allowed  under this subdivision for any taxable year reduces the tax
    35  to such amount or if the taxpayer otherwise pays tax based on the  fixed
    36  dollar  minimum amount, any amount of credit thus not deductible in such
    37  taxable year will be treated as an overpayment of tax to be credited  or
    38  refunded  in  accordance  with  the  provisions  of section one thousand
    39  eighty-six  of  this  chapter.  Provided,  however,  the  provisions  of
    40  subsection  (c)  of  section  one  thousand eighty-eight of this chapter
    41  notwithstanding, no interest will be paid thereon.
    42    § 4. Subparagraph (B) of paragraph 1 of subsection (i) of section  606
    43  of the tax law is amended by adding a new clause (1) to read as follows:
    44  (1) Credit for owners of             Amount of credit under
    45  agricultural assets under            subdivision fifty-nine of
    46  subsection (ooo)                     section two hundred ten-B
    47    §  5. Section 606 of the tax law is amended by adding a new subsection
    48  (ooo) to read as follows:
    49    (ooo) Credit for owners of agricultural assets.  (1) A taxpayer  shall
    50  be  allowed  a credit, to be computed as provided in section forty-eight
    51  of this chapter, against the tax imposed by this article.
    52    (2) Application of credit. If the amount of credit allowed under  this
    53  subsection  for  any  taxable  year  exceeds the taxpayer's tax for such
    54  year, the excess will be treated as an overpayment of tax to be credited
    55  or refunded in accordance with the provisions  of  section  six  hundred

        S. 1680                             4
 
     1  eighty-six  of this article, provided, however, that no interest will be
     2  paid thereon.
     3    §  6.  Section  16  of  the  agriculture and markets law is amended by
     4  adding a new subdivision 53 to read as follows:
     5    53. (a) Establish a program for initial  certification  of  owners  of
     6  agricultural  assets  and  beginning farmers for purposes of eligibility
     7  for a tax credit pursuant to section forty-eight of the tax law.
     8    (b) Adopt, promulgate and implement rules, regulations and orders with
     9  respect to application for certification,  continued  qualification  for
    10  certification and termination of certification of owners of agricultural
    11  assets and/or beginning farmers for purposes of eligibility for such tax
    12  credit.
    13    (c)  Certify  rental  agreements  entered  into by certified owners of
    14  agricultural assets and beginning farmers are fair and at rates equal to
    15  the market value of the farm product as provided in section  forty-eight
    16  of  the  tax  law;  provided  that agricultural assets must be rented at
    17  prevailing community rates as determined by the commissioner.
    18    (d) Notify the commissioner of taxation and finance  of  all  approved
    19  applications  and  all  applications  for which certification was subse-
    20  quently terminated by the commissioner.
    21    § 7. This act shall take effect immediately and shall apply to taxable
    22  years beginning on or after January 1, 2025.
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