A02170 Summary:
BILL NO | A02170 |
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SAME AS | SAME AS S00543 |
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SPONSOR | Dinowitz (MS) |
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COSPNSR | Thiele, Reyes, Mitaynes, Rosenthal L, Gallagher, Steck, Glick, Carroll, Fahy, Kelles, Mamdani, Kim, Burgos, Seawright, Cunningham, Raga, Cruz, Wallace, Otis, Solages, Shrestha, Hevesi, Septimo, Paulin, Shimsky, Epstein, Burdick, O'Donnell, Forrest, Levenberg, Gonzalez-Rojas, Anderson, Bores |
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MLTSPNSR | Simon |
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Amd §§208, 612 & 1503, Tax L; amd §§11-602, 11-652 & 11-1712, NYC Ad Cd | |
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Relates to treatment of gains from qualified opportunity zones in calculating taxable income; removes exclusion of gains on property in qualified opportunity zones in calculation of income. |
A02170 Memo:
Go to topNEW YORK STATE ASSEMBLY
MEMORANDUM IN SUPPORT OF LEGISLATION
submitted in accordance with Assembly Rule III, Sec 1(f)   BILL NUMBER: A2170 SPONSOR: Dinowitz (MS)
  TITLE OF BILL: An act to amend the tax law and the administrative code of the city of New York, in relation to treatment of gains from qualified opportunity zones in calculating taxable income   PURPOSE: To fully decouple NYS and NYC from the federal Opportunity Zone tax code.   SUMMARY OF PROVISIONS: Section one amends paragraph (b) of subdivision 9 of section 208 of the tax law to add a new paragraph 28 to include that "entire net income" shall be determined without the exclusion, deduction or credit of the amount of gain excluded from federal gross income for the taxable year by subparagraph (c) of paragraph (1) of subsection (a) of section 1400Z-2 of the internal revenue code. Section two amends subdivision 9 of section 208 of the tax law to add a new paragraph (u) which states that for tax years beginning on or after January 1, 2021, upon the sale or exchange of property with respect to which the taxpayer has made the election under subparagraph (c) of para- graph (1) of subsection (a) of section 14002-2 of the internal revenue code, the basis of such property under this article shall be determined as if the taxpayer had not made such election. Section three amends subsection (b) of section 612 of the tax law to add a new paragraph 43 to include that there shall be added to federal adjusted gross income the amount of gain excluded from federal gross income for the taxable year by subparagraph (c) of paragraph (1) of subsection (a) of section 1400Z-2 of the internal revenue code. Section four amends section 612 of the tax law to add a new subsection (y) which states that for tax years beginning on or after January 1, 2021, upon the sale or exchange of property with respect to which the taxpayer has made the election under subparagraph (c) of paragraph (1) of subsection (a) of section 1400Z-2 of the internal revenue code, the basis of such property under this article shall be determined as if the taxpayer had not made such election. Section five amends paragraph 2 of subdivision (b) of section 1503 of the tax law to add a new subparagraph (AA) to include that "entire net income" shall be determined without the exclusion, deduction or credit of the amount of gain excluded from federal gross income for the taxable year by subparagraph (c) of paragraph (1) of subsection (a) of section 14002-2 of the internal revenue code. Section six amends section 1503 of the tax law to add a new subdivision (d) which states that for tax years beginning on or after January 1, 2021, upon the sale or exchange of property with respect to which the taxpayer has made the election under subparagraph (c) of paragraph (1) of subsection (a) of section 1400Z-2 of the internal revenue code, the basis of.such property under this article shall be determined as if the taxpayer had not made such election. Section seven amends paragraph (a) of subdivision 8 of section 11-602 of the administrative code of the city of New York to add a new paragraph 16 to include that "entire net income" shall be determined without the exclusion, deduction or credit of the amount of gain excluded from federal gross income for the taxable year by subparagraph (c) of para- graph (1) of subsection (a) of section 1400Z-2 of the internal revenue code. Section eight amends section 11-602 of the administrative code of the city of New York to add a new subdivision 11 which states that for tax years beginning on or after January 1, 2021, upon the sale or exchange of property with respect to which the taxpayer has made the election under subparagraph (c) of paragraph (1) of subsection (a) of section 1400Z-2 of the internal revenue code, the basis of such property under this article shall be determined as if the taxpayer had not made such election. Section nine paragraph (a) of subdivision 8 of section 11-652 of the administrative code of the city of New York to add a new subparagraph 17 to include that "entire net income" shall not include the amount of gain excluded from federal gross income for the taxable year by subparagraph (c) of paragraph (1) of subsection (a) of section 1400Z-2 of the inter- nal revenue code. Section ten amends subdivision 8 of section 11-652 of the administrative code of the city of New York to add a new paragraph (u) which states that for tax years beginning on or after January 1, 2021, upon the sale or exchange of property with respect to which the taxpayer has made the election under subparagraph (c) of paragraph (1) of subsection (a) of section 1400Z-2 of the internal revenue code, the basis of such property under this article shall be determined as if the taxpayer had not made such election. Section eleven amends subdivision (b) of section 11-1712 of the adminis- trative code of the city of New York to add a new paragraph 40 to include that there shall be added to federal adjusted gross income the amount of gain excluded from federal gross income for the taxable year by subparagraph (c) of paragraph (1) of subsection (a) of section 1400Z-2 of the internal revenue code. Section twelve amends section 11-1712 of the administrative code of the city of New York to add a new subdivision (w) which states that for tax years' beginning on or after January 1, 2021, upon the sale or exchange of property with respect to which the taxpayer has made the election under subparagraph (c) of paragraph (1) of subsection (a) of section 14002-2 of the internal revenue code, the basis of such property under this article shall be determined as if the taxpayer had not made such election. Section thirteen sets the effective date.   JUSTIFICATION: The FY21 New York State Budget partially decoupled the NYS and NYC tax laws from the federal Opportunity Zone program, which will save the state hundreds of millions of.dollars. However, it is imperative that the Exclusion (10 year) Benefit also be decoupled. Although this benefit has no fiscal to the State for several years, it is imperative that we fully decouple the program from our state's tax laws now.   LEGISLATIVE HISTORY: 2021-22: A.8081-A - Ways and Means / S.6800-A - Passed Senate   FISCAL IMPLICATIONS: The bill will prevent a loss in tax revenue to the state.   EFFECTIVE DATE: This act shall take effect immediately and shall apply to taxable years beginning on or after January 1, 2023.
A02170 Text:
Go to top STATE OF NEW YORK ________________________________________________________________________ 2170 2023-2024 Regular Sessions IN ASSEMBLY January 23, 2023 ___________ Introduced by M. of A. DINOWITZ, THIELE, REYES, MITAYNES, L. ROSENTHAL, GALLAGHER, STECK, GLICK, CARROLL, FAHY, KELLES, MAMDANI -- Multi-Spon- sored by -- M. of A. SIMON -- read once and referred to the Committee on Ways and Means AN ACT to amend the tax law and the administrative code of the city of New York, in relation to treatment of gains from qualified opportunity zones in calculating taxable income The People of the State of New York, represented in Senate and Assem- bly, do enact as follows: 1 Section 1. Paragraph (b) of subdivision 9 of section 208 of the tax 2 law is amended by adding a new subparagraph 28 to read as follows: 3 (28) the amount of gain excluded from federal gross income for the 4 taxable year by subparagraph (c) of paragraph (1) of subsection (a) of 5 section 1400Z-2 of the internal revenue code. 6 § 2. Subdivision 9 of section 208 of the tax law is amended by adding 7 a new paragraph (u) to read as follows: 8 (u) For tax years beginning on or after January first, two thousand 9 twenty-three, upon the sale or exchange of property with respect to 10 which the taxpayer has made the election under subparagraph (c) of para- 11 graph (1) of subsection (a) of section 1400Z-2 of the internal revenue 12 code, the basis of such property under this article shall be determined 13 as if the taxpayer had not made such election. 14 § 3. Subsection (b) of section 612 of the tax law is amended by adding 15 a new paragraph 44 to read as follows: 16 (44) the amount of gain excluded from federal gross income for the 17 taxable year by subparagraph (c) of paragraph (1) of subsection (a) of 18 section 1400Z-2 of the internal revenue code. 19 § 4. Section 612 of the tax law is amended by adding a new subsection 20 (y) to read as follows: 21 (y) Qualified opportunity zones. For tax years beginning on or after 22 January first, two thousand twenty-three, upon the sale or exchange of EXPLANATION--Matter in italics (underscored) is new; matter in brackets [] is old law to be omitted. LBD01221-01-3A. 2170 2 1 property with respect to which the taxpayer has made the election under 2 subparagraph (c) of paragraph (1) of subsection (a) of section 1400Z-2 3 of the internal revenue code, the basis of such property under this 4 article shall be determined as if the taxpayer had not made such 5 election. 6 § 5. Paragraph 2 of subdivision (b) of section 1503 of the tax law is 7 amended by adding a new subparagraph (AA) to read as follows: 8 (AA) the amount of gain excluded from federal gross income for the 9 taxable year by subparagraph (c) of paragraph (1) of subsection (a) of 10 section 1400Z-2 of the internal revenue code. 11 § 6. Section 1503 of the tax law is amended by adding a new subdivi- 12 sion (d) to read as follows: 13 (d) For tax years beginning on or after January first, two thousand 14 twenty-three, upon the sale or exchange of property with respect to 15 which the taxpayer has made the election under subparagraph (c) of para- 16 graph (1) of subsection (a) of section 1400Z-2 of the internal revenue 17 code, the basis of such property under this article shall be determined 18 as if the taxpayer had not made such election. 19 § 7. Paragraph (a) of subdivision 8 of section 11-602 of the adminis- 20 trative code of the city of New York is amended by adding a new subpara- 21 graph 17 to read as follows: 22 (17) the amount of gain excluded from federal gross income for the 23 taxable year by subparagraph (c) of paragraph (1) of subsection (a) of 24 section 1400Z-2 of the internal revenue code. 25 § 8. Section 11-602 of the administrative code of the city of New York 26 is amended by adding a new subdivision 11 to read as follows: 27 11. For tax years beginning on or after January first, two thousand 28 twenty-three, upon the sale or exchange of property with respect to 29 which the taxpayer has made the election under subparagraph (c) of para- 30 graph (1) of subsection (a) of section 1400Z-2 of the internal revenue 31 code, the basis of such property under this article shall be determined 32 as if the taxpayer had not made such election. 33 § 9. Paragraph (a) of subdivision 8 of section 11-652 of the adminis- 34 trative code of the city of New York is amended by adding a new subpara- 35 graph 18 to read as follows: 36 (18) the amount of gain excluded from federal gross income for the 37 taxable year by subparagraph (c) of paragraph (1) of subsection (a) of 38 section 1400Z-2 of the internal revenue code. 39 § 10. Subdivision 8 of section 11-652 of the administrative code of 40 the city of New York is amended by adding a new paragraph (u) to read as 41 follows: 42 (u) For tax years beginning on or after January first, two thousand 43 twenty-three, upon the sale or exchange of property with respect to 44 which the taxpayer has made the election under subparagraph (c) of para- 45 graph (1) of subsection (a) of section 1400Z-2 of the internal revenue 46 code, the basis of such property under this article shall be determined 47 as if the taxpayer had not made such election. 48 § 11. Subdivision (b) of section 11-1712 of the administrative code of 49 the city of New York is amended by adding a new paragraph 40 to read as 50 follows: 51 (40) the amount of gain excluded from federal gross income for the 52 taxable year by subparagraph (c) of paragraph (1) of subsection (a) of 53 section 1400Z-2 of the internal revenue code. 54 § 12. Section 11-1712 of the administrative code of the city of New 55 York is amended by adding a new subdivision (w) to read as follows:A. 2170 3 1 (w) For tax years beginning on or after January first, two thousand 2 twenty-three, upon the sale or exchange of property with respect to 3 which the taxpayer has made the election under subparagraph (c) of para- 4 graph (1) of subsection (a) of section 1400Z-2 of the internal revenue 5 code, the basis of such property under this article shall be determined 6 as if the taxpayer had not made such election. 7 § 13. This act shall take effect immediately and shall apply to taxa- 8 ble years beginning on or after January 1, 2023.