Bill Text: NY A05750 | 2019-2020 | General Assembly | Introduced


Bill Title: Creates the middle class circuit breaker tax credit and a tax reform study commission.

Spectrum: Slight Partisan Bill (Democrat 12-4)

Status: (Introduced) 2019-02-14 - referred to ways and means [A05750 Detail]

Download: New_York-2019-A05750-Introduced.html


                STATE OF NEW YORK
        ________________________________________________________________________
                                          5750
                               2019-2020 Regular Sessions
                   IN ASSEMBLY
                                    February 14, 2019
                                       ___________
        Introduced  by  M.  of  A.  ENGLEBRIGHT, CAHILL, GUNTHER, GALEF, JAFFEE,
          L. ROSENTHAL, COLTON, COOK, GOTTFRIED -- Multi-Sponsored by --  M.  of
          A.  BARCLAY, CROUCH, GIGLIO, LUPARDO, PERRY, RAIA, THIELE -- read once
          and referred to the Committee on Ways and Means
        AN ACT to amend the tax law, in relation to creating  the  middle  class
          circuit breaker tax credit and creating a tax reform study commission
          The  People of the State of New York, represented in Senate and Assem-
        bly, do enact as follows:
     1    Section 1. Section 606 of the tax law  is  amended  by  adding  a  new
     2  subsection (jjj) to read as follows:
     3    (jjj)  Middle  class  circuit breaker credit. (1) Definitions. For the
     4  purposes of this subsection:
     5    (A) "Qualified taxpayer" means a resident individual of the state  who
     6  owns  or rents the residential real property in which he or she resides,
     7  and has resided in such residential real property for not less than five
     8  years.
     9    (B) "Household" or  "members  of  the  household"  means  a  qualified
    10  taxpayer  or  qualified taxpayers and all other persons, not necessarily
    11  related, who all reside in the residential real property  owned  by  the
    12  taxpayer  or taxpayers, and share its furnishings, facilities and accom-
    13  modations; provided that no person may be a  member  of  more  than  one
    14  household at one time.
    15    (C) "Household gross income" means the aggregate adjusted gross income
    16  of  all  members  of  the household for the taxable year as reported for
    17  federal income tax purposes, or which  would  be  reported  as  adjusted
    18  gross  income  if a federal income tax return were required to be filed,
    19  with the modifications in subsection (b) of section six  hundred  twelve
    20  of  this article but without the modifications in subsection (c) of such
    21  section, plus any portion of the gain from the sale or exchange of prop-
    22  erty otherwise excluded from such amount;  earned  income  from  sources
    23  without  the  United  States  excludable  from  federal  gross income by
         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD06765-02-9

        A. 5750                             2
     1  section nine hundred eleven of the internal revenue code; support  money
     2  not  included  in  adjusted  gross  income;  nontaxable strike benefits;
     3  supplemental security income payments; the gross amount of  any  pension
     4  or  annuity  benefits  to the extent not included in such adjusted gross
     5  income (including, but not limited to, railroad retirement benefits  and
     6  all  payments  received under the federal social security act and veter-
     7  ans' disability pensions); nontaxable interest received from  the  state
     8  of  New  York,  its agencies, instrumentalities, public corporations, or
     9  political subdivisions (including a public corporation created  pursuant
    10  to  agreement or compact with another state or Canada); workers' compen-
    11  sation; the gross amount of "loss-of-time" insurance; and the amount  of
    12  cash public assistance and relief, other than medical assistance for the
    13  needy,  paid  to or for the benefit of the qualified taxpayer or members
    14  of his or her household. Household  gross  income  shall    not  include
    15  surplus  foods  or  other relief in kind or payments made to individuals
    16  because of their status as victims of Nazi  persecution  as  defined  in
    17  public  law  103-286 or any disability compensation received by veterans
    18  on account of injury or illness incurred or aggravated  during  military
    19  service  in  the  wars in Afghanistan and Iraq since September eleventh,
    20  two thousand one.  Provided, further, household gross income shall  only
    21  include  all  such income received by all members of the household while
    22  members of such household.
    23    (D) "Adjusted rent" means rent paid for the right of  occupancy  of  a
    24  residence.
    25    (E)  "Real property tax equivalent" means (1) for taxable years begin-
    26  ning in two thousand twenty, fifteen percent of the adjusted rent  actu-
    27  ally  paid  in  the  taxable year by a household solely for the right of
    28  occupancy of its New York residence for the taxable year. If (i) a resi-
    29  dence is rented to two or more individuals as cotenants, or  such  indi-
    30  viduals share in the payment of a single rent for the right of occupancy
    31  of  such residence, and (ii) each of such individuals  is a member of  a
    32  different household, one or more of which individuals shares such  resi-
    33  dence,  real  property tax equivalent is that portion of fifteen percent
    34  of the adjusted rent paid  in  the  taxable  year  which  reflects  that
    35  portion  of  the  rent  attributable  to  the qualified taxpayer and the
    36  members of his or her household; and (2) for taxable years beginning  in
    37  two  thousand twenty and thereafter, twenty percent of the adjusted rent
    38  actually paid in the taxable year  by a household solely for  the  right
    39  of  occupancy  of  its New York residence for the taxable year. If (i) a
    40  residence is rented to two or more individuals  as  cotenants,  or  such
    41  individuals share in the payment of a single rent for the right of occu-
    42  pancy  of  such residence, and (ii) each of such individuals is a member
    43  of a different household, one or more of which individuals  shares  such
    44  residence,  real  property  tax  equivalent  is  that  portion of twenty
    45  percent of the adjusted rent paid in the  taxable  year  which  reflects
    46  that  portion of the rent attributable to the qualified taxpayer and the
    47  members of his or her household.
    48    (F) "Net real property tax" means the real property taxes assessed  on
    49  the  residential  real  property  owned  and occupied by the taxpayer or
    50  taxpayers after any exemption or abatement received pursuant to the real
    51  property tax law.
    52    (2) Credit. A qualified taxpayer shall be allowed a credit against the
    53  taxes imposed by this article, equal to seventy percent of the amount by
    54  which the taxpayer's net real property tax or the taxpayer's real  prop-
    55  erty tax equivalent exceeds the taxpayer's maximum real property tax, as
    56  determined by paragraph three of this subsection. If such credit exceeds

        A. 5750                             3
     1  the tax for such taxable year, as reduced by the other credits permitted
     2  by  this  article,  the  qualified  taxpayer  may receive, and the comp-
     3  troller, subject to a certificate of the department,  shall  pay  as  an
     4  overpayment, without interest, any excess between such tax as so reduced
     5  and the amount of the credit. If a qualified taxpayer is not required to
     6  file a return pursuant to section six hundred fifty-one of this article,
     7  a  qualified  taxpayer  may  nevertheless  receive  and the comptroller,
     8  subject to a certificate of the department, shall pay as an  overpayment
     9  the full amount of the credit, without interest.
    10    (3) Maximum real property tax. (A) A qualified taxpayer's maximum real
    11  property tax shall be determined as follows:
    12    (i) For tax years beginning in two thousand twenty:
    13  Household gross income               Maximum real property tax
    14  One hundred thousand                 Nine percent of the
    15  dollars or less                      household gross income
    16  More than one hundred                No limitation.
    17  thousand dollars
    18    (ii) For tax years beginning in two thousand twenty-one:
    19  Household gross income               Maximum real property tax
    20  One hundred thousand                 Eight and one-half percent of the
    21  dollars or less                      household gross income
    22  More than one hundred                No limitation.
    23  thousand dollars
    24    (iii) For tax years beginning in two thousand twenty-two:
    25  Household gross income               Maximum real property tax
    26  One hundred thousand dollars         Seven and one-half percent of
    27  or less                              household gross income
    28  More than one hundred thousand       Seven and one-half percent of
    29  dollars, but less than or equal to   one hundred thousand dollars
    30  one hundred fifty thousand dollars   plus eight and one-half percent of
    31                                       household gross income above
    32                                       one hundred thousand dollars
    33  More than one hundred fifty          No limitation.
    34  thousand dollars
    35    (iv) For tax years beginning in two thousand twenty-three and thereafter:
    36  Household gross income               Maximum real property tax
    37  One hundred thousand                 Six percent of household gross
    38  dollars or less                      income
    39  More than one hundred thousand       Six percent of one hundred
    40  dollars, but less than or equal to   thousand dollars plus seven
    41  one hundred fifty thousand dollars   percent of household gross income
    42                                       above one hundred thousand dollars
    43  More than one hundred fifty          Six percent of one hundred thousand
    44  thousand dollars, but less than      dollars plus seven
    45  or equal to two hundred fifty        percent of fifty thousand dollars
    46  thousand dollars                     plus eight and one-half percent of
    47                                       household gross income above one
    48                                       hundred fifty thousand dollars
    49  More than two hundred fifty          No limitation.
    50  thousand dollars
    51    (B)  The  thresholds  of  household gross income established by clause
    52  (iv) of  subparagraph  (A)  of  this  paragraph  shall  be  indexed  for

        A. 5750                             4
     1  inflation for tax years beginning in two thousand twenty-four and there-
     2  after.
     3    (4) Exclusions from eligibility. No credit shall be granted under this
     4  subsection  if  the  qualified  taxpayer  claims  the  real property tax
     5  circuit breaker credit, pursuant to  subsection  (e)  of  this  section,
     6  during the taxable year.
     7    §  2.  There  is  hereby  established a tax reform study commission to
     8  provide the governor and the  legislature  with  a  long  run  plan  for
     9  reforming  the state and local tax systems. The tax reform study commis-
    10  sion shall consist of five  members  appointed  by  the  governor,  four
    11  members  each appointed by the speaker of the assembly and the temporary
    12  president of the senate, and one member each appointed by  the  minority
    13  leader  of  the senate and the minority leader of the assembly. In addi-
    14  tion, on or before January 1, 2022,  the  tax  reform  study  commission
    15  shall  provide  the governor and the legislature with recommendations on
    16  any changes that should be made in the definitions of income used in the
    17  various property tax relief programs authorized by the laws of the state
    18  of New York. Such recommendations shall be based on  an  examination  of
    19  such  laws and of such laws in other states. In preparing such recommen-
    20  dations, the tax reform study commission shall review the distributional
    21  impact of the items of income included in the  definition  of  household
    22  income for purposes of the circuit breaker and other property tax relief
    23  programs established by state law and make recommendations to the gover-
    24  nor and the legislature for any changes in any of these definitions that
    25  the  tax  reform study commission deems appropriate. The commissioner of
    26  taxation and finance and the director of the  office  of  real  property
    27  services  shall  provide  the tax reform study commission with such data
    28  and analysis as it may require.
    29    § 3. This act shall take effect immediately.
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