Bill Text: NY A05546 | 2015-2016 | General Assembly | Introduced

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Bill Title: Grants a state personal income tax deduction for retirement plan distributions used to purchase long-term care insurance; exempts distributions from individual retirement accounts and individual retirement annuities from state personal income taxation when such distributions are used to purchase long-term health care insurance.

Spectrum: Partisan Bill (Democrat 12-0)

Status: (Introduced - Dead) 2016-01-06 - referred to ways and means [A05546 Detail]

Download: New_York-2015-A05546-Introduced.html

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                           S T A T E   O F   N E W   Y O R K
       ________________________________________________________________________
                                         5546
                              2015-2016 Regular Sessions
                                 I N  A S S E M B L Y
                                   February 27, 2015
                                      ___________
       Introduced  by  M.  of  A.  ENGLEBRIGHT,  ABBATE,  CAHILL, MAGNARELLI --
         Multi-Sponsored by -- M. of A. ARROYO, COLTON, COOK, MARKEY,  PEOPLES-
         STOKES,  PERRY,  RIVERA,  SCHIMMINGER -- read once and referred to the
         Committee on Ways and Means
       AN ACT to amend the tax law, in relation to exempting distributions from
         individual retirement accounts  and  individual  retirement  annuities
         from  state  personal income taxation when such distributions are used
         to purchase long-term health care insurance
         THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
       BLY, DO ENACT AS FOLLOWS:
    1    Section  1. Subsection (c) of section 612 of the tax law is amended by
    2  adding a new paragraph 3-d to read as follows:
    3    (3-D) DISTRIBUTIONS RECEIVED BY AN INDIVIDUAL, NOT OTHERWISE  EXCLUDED
    4  PURSUANT TO PARAGRAPH THREE OR THREE-A OF THIS SUBSECTION, TO THE EXTENT
    5  INCLUDABLE  IN  GROSS  INCOME FOR FEDERAL INCOME TAX PURPOSES, WHICH ARE
    6  ATTRIBUTABLE TO PERSONAL SERVICES  PERFORMED  BY  SUCH  INDIVIDUAL  FROM
    7  EMPLOYMENT,  WHICH  ARISE  (I) FROM AN EMPLOYER-EMPLOYEE RELATIONSHIP OR
    8  (II) FROM CONTRIBUTIONS TO A RETIREMENT PLAN WHICH  ARE  DEDUCTIBLE  FOR
    9  FEDERAL  INCOME  TAX PURPOSES, TO THE EXTENT SUCH DISTRIBUTIONS ARE USED
   10  DURING THE TAXABLE YEAR TO PURCHASE A POLICY OF  LONG-TERM  CARE  INSUR-
   11  ANCE,  AS  DEFINED  IN SECTION ONE THOUSAND ONE HUNDRED SEVENTEEN OF THE
   12  INSURANCE LAW, FOR SUCH INDIVIDUAL OR A DEPENDENT  OF  SUCH  INDIVIDUAL.
   13  SUCH  DISTRIBUTIONS  SHALL  INCLUDE  DISTRIBUTIONS  FROM  AN  INDIVIDUAL
   14  RETIREMENT ACCOUNT OR AN INDIVIDUAL RETIREMENT ANNUITY,  AS  DEFINED  IN
   15  SECTION  FOUR  HUNDRED  EIGHT OF THE INTERNAL REVENUE CODE, AND DISTRIB-
   16  UTIONS FROM SELF-EMPLOYED INDIVIDUAL AND OWNER-EMPLOYEE RETIREMENT PLANS
   17  WHICH QUALIFY UNDER SECTION FOUR HUNDRED ONE  OF  THE  INTERNAL  REVENUE
   18  CODE.    PROVIDED,  HOWEVER, THAT ANY DISTRIBUTIONS EXCLUDED PURSUANT TO
   19  THIS PARAGRAPH SHALL BE SUBTRACTED FROM THE  TOTAL  AMOUNT  OF  PREMIUMS
   20  PAID   WHEN  COMPUTING  THE  AMOUNT  OF  ALLOWABLE  CREDIT  PURSUANT  TO
   21  SUBSECTION (AA) OF SECTION SIX HUNDRED SIX OF THIS ARTICLE.
        EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                             [ ] is old law to be omitted.
                                                                  LBD08509-01-5
       A. 5546                             2
    1    S 2. Subsection (aa) of section 606 of the  tax  law,  as  amended  by
    2  section  1  of  part  P of chapter 61 of the laws of 2005, is amended to
    3  read as follows:
    4    (aa)  Long-term care insurance credit. (1) Residents. A taxpayer shall
    5  be allowed a credit against the tax imposed by  this  article  equal  to
    6  twenty percent of the premium paid during the taxable year for long-term
    7  care  insurance,  PROVIDED  THAT  ANY  AMOUNT  SUBTRACTED  FROM  FEDERAL
    8  ADJUSTED GROSS INCOME PURSUANT  TO  PARAGRAPH  THREE-D  OF  SECTION  SIX
    9  HUNDRED  TWELVE  OF  THIS ARTICLE SHALL BE SUBTRACTED FROM THE AMOUNT OF
   10  PREMIUM PAID DURING THE TAXABLE YEAR AND THE TWENTY PERCENT CREDIT SHALL
   11  BE BASED UPON SUCH RECOMPUTED AMOUNT OF PREMIUM PAID.  In order to qual-
   12  ify for such credit, the taxpayer's premium  payment  must  be  for  the
   13  purchase  of or for continuing coverage under a long-term care insurance
   14  policy that qualifies for such credit pursuant to section  one  thousand
   15  one  hundred seventeen of the insurance law. If the amount of the credit
   16  allowable under this subsection for any taxable year  shall  exceed  the
   17  taxpayer's  tax  for  such  year,  the excess may be carried over to the
   18  following year or years and may be deducted from the taxpayer's tax  for
   19  such year or years.
   20    (2) Nonresidents and part-year residents. In the case of a nonresident
   21  taxpayer  or  a part-year resident taxpayer, the credit determined under
   22  this subsection shall be limited to the amount determined by multiplying
   23  the amount of such credit by the New York source fraction as  set  forth
   24  in  paragraph three of subsection (e) of section six hundred one of this
   25  article. The credit as so limited shall be applied as provided in  para-
   26  graph  one  of this subsection, PROVIDED THAT ANY AMOUNT SUBTRACTED FROM
   27  FEDERAL ADJUSTED GROSS INCOME PURSUANT TO PARAGRAPH THREE-D  OF  SECTION
   28  SIX HUNDRED TWELVE OF THIS ARTICLE AND SECTION SIX HUNDRED THIRTY-ONE OF
   29  THIS  ARTICLE SHALL BE SUBTRACTED FROM THE AMOUNT OF PREMIUM PAID DURING
   30  THE TAXABLE YEAR AND THE TWENTY PERCENT CREDIT SHALL BE BASED UPON  SUCH
   31  RECOMPUTED AMOUNT OF PREMIUM PAID.
   32    S 3. This act shall take effect immediately and shall apply to taxable
   33  years  commencing  on  January first in the year in which this act shall
   34  take effect and all subsequent taxable years.