Establishes a first permanent payroll employee tax credit which allows a business to receive a tax credit for the three years following the employment of such business' first permanent payroll employee where such credit equals a portion of the amount it costs to employ such permanent payroll employee.
STATE OF NEW YORK
________________________________________________________________________
7043
IN SENATE(Prefiled)
January 8, 2020
___________
Introduced by Sen. BORRELLO -- read twice and ordered printed, and when
printed to be committed to the Committee on Budget and Revenue
AN ACT to amend the tax law, in relation to establishing a first perma-
nent payroll employee tax credit
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. Section 210-B of the tax law is amended by adding a new
2 subdivision 54 to read as follows:
3 54. First permanent payroll employee credit. (a) General. A taxpayer
4 shall be allowed a credit, to be computed as provided in this subdivi-
5 sion, against the tax imposed by this article for the first full-time,
6 permanent employee such taxpayer employs, provided that such full-time,
7 permanent employee is accounted for on such taxpayer's employer payroll
8 records. Such credit shall be available for each of the three years
9 succeeding the date a taxpayer employs their first full-time, permanent
10 employee.
11 (b) Amount of credit. A credit authorized by this subdivision shall be
12 equal to:
13 (1) in the first year, twenty-five percent of the total cost to employ
14 a full-time, permanent employee, when such employee is accounted for on
15 an employer's payroll records and is the first full-time, permanent
16 employee such taxpayer has hired;
17 (2) in the second year, twenty percent of the total cost to employ a
18 full-time, permanent employee, when such employee is accounted for on an
19 employer's payroll records and is the first full-time, permanent employ-
20 ee such taxpayer has hired; and
21 (3) in the third year, ten percent of the total cost to employ a full-
22 time, permanent employee, when such employee is accounted for on an
23 employer's payroll records and is the first full-time, permanent employ-
24 ee such taxpayer has hired.
25 (c) Carryovers. The credit allowed under this subdivision may be
26 claimed and if not fully used in the initial year for which the credit
27 is claimed may be carried over, in order, to each of the two succeeding
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD14423-03-9
S. 7043 2
1 taxable years. The credit authorized by this subdivision may not be used
2 to reduce the tax liability of the credit claimant below zero.
3 (d) Definitions. For purposes of this subdivision, the following terms
4 shall have the following meanings:
5 (1) "Total cost to employ" shall mean base salary, New York state
6 payroll taxes and the value of employment benefits received.
7 (2) "New York state payroll taxes" shall mean all state taxes paid by
8 an employer from such employer's own funds and directly related to
9 employing an employee.
10 (e) Aggregate amount. The aggregate amount of tax credits allowed
11 pursuant to the authority of this subdivision and subsection (kkk) of
12 section six hundred six of this chapter shall be fifteen million dollars
13 each year. Such aggregate amounts of credits shall be allocated by the
14 commissioner. If the total amount of allocated credits applied for in
15 any particular year exceeds the aggregate amount of tax credits allowed
16 for such year under this section, such excess shall be treated as having
17 been applied for on the first day of the subsequent year.
18 (f) Claim of credit. (1) Taxpayers shall be eligible to claim such
19 credit beginning in the first taxable year after such taxpayer has
20 employed their first full-time, permanent employee, as verified on such
21 taxpayer's payroll records.
22 (2) A taxpayer shall not be allowed to claim this credit to the extent
23 the basis of the calculation of this credit has been claimed for another
24 tax credit under this chapter.
25 § 2. Section 606 of the tax law is amended by adding a new subsection
26 (kkk) to read as follows:
27 (kkk) First permanent payroll employee credit. (1) General. A taxpayer
28 shall be allowed a credit, to be computed as provided in this
29 subsection, against the tax imposed by this article for the first full-
30 time, permanent employee such taxpayer employs, provided that such full-
31 time, permanent employee is accounted for on such taxpayer's employer
32 payroll records. Such credit shall be available for each of the three
33 years succeeding the date a taxpayer employs their first full-time,
34 permanent employee.
35 (2) Amount of credit. A credit authorized by this subsection shall be
36 equal to:
37 (A) in the first year, twenty-five percent of the total cost to employ
38 a full-time, permanent employee, when such employee is accounted for on
39 an employer's payroll records and is the first full-time, permanent
40 employee such taxpayer has hired;
41 (B) in the second year, twenty percent of the total cost to employ a
42 full-time, permanent employee, when such employee is accounted for on an
43 employer's payroll records and is the first full-time, permanent employ-
44 ee such taxpayer has hired; and
45 (C) in the third year, ten percent of the total cost to employ a full-
46 time, permanent employee, when such employee is accounted for on an
47 employer's payroll records and is the first full-time, permanent employ-
48 ee such taxpayer has hired.
49 (3) Carryovers. The credit allowed under this subsection may be
50 claimed and if not fully used in the initial year for which the credit
51 is claimed may be carried over, in order, to each of the two succeeding
52 taxable years. The credit authorized by this subsection may not be used
53 to reduce the tax liability of the credit claimant below zero.
54 (4) Definitions. For purposes of this subsection, the following terms
55 shall have the following meanings:
S. 7043 3
1 (A) "Total cost to employ" shall mean base salary, New York state
2 payroll taxes and the value of employment benefits received.
3 (B) "New York state payroll taxes" shall mean all state taxes paid by
4 an employer from such employer's own funds and directly related to
5 employing an employee.
6 (5) Aggregate amount. The aggregate amount of tax credits allowed
7 pursuant to the authority of this subsection and subdivision fifty-four
8 of section two hundred ten-B of this chapter shall be fifteen million
9 dollars each year. Such aggregate amounts of credits shall be allocated
10 by the commissioner. If the total amount of allocated credits applied
11 for in any particular year exceeds the aggregate amount of tax credits
12 allowed for such year under this section, such excess shall be treated
13 as having been applied for on the first day of the subsequent year.
14 (6) Claim of credit. (A) Taxpayers shall be eligible to claim such
15 credit beginning in the first taxable year after such taxpayer has
16 employed their first full-time, permanent employee, as verified on such
17 taxpayer's payroll records.
18 (B) A taxpayer shall not be allowed to claim this credit to the extent
19 the basis of the calculation of this credit has been claimed for another
20 tax credit under this chapter.
21 § 3. Subparagraph (B) of paragraph 1 of subsection (i) of section 606
22 of the tax law is amended by adding a new clause (xlv) to read as
23 follows:
24 (xlv) First permanent payrollAmount of credit under subdivision
25 employee credit under subsectionfifty-four of section two hundred
26 (kkk)ten-B
27 § 4. This act shall take effect immediately and shall apply to taxable
28 years commencing on and after January 1, 2020.
