Bill Text: NY S04236 | 2023-2024 | General Assembly | Introduced

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Bill Title: Relates to business income base and certain small business taxpayers.

Spectrum: Partisan Bill (Republican 3-0)

Status: (Introduced) 2024-01-03 - REFERRED TO BUDGET AND REVENUE [S04236 Detail]

Download: New_York-2023-S04236-Introduced.html

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                STATE OF NEW YORK
        ________________________________________________________________________

                                          4236

                               2023-2024 Regular Sessions

                    IN SENATE

                                    February 6, 2023
                                       ___________

        Introduced  by  Sen.  O'MARA -- 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 and the administrative code of the  city  of
          New  York, in relation to business income base and certain small busi-
          ness taxpayers

          The People of the State of New York, represented in Senate and  Assem-
        bly, do enact as follows:

     1    Section  1.  Subparagraph  (iv)  of  paragraph (a) of subdivision 1 of
     2  section 210 of the tax law, as amended by section 12 of part A of  chap-
     3  ter 59 of the laws of 2014, is amended to read as follows:
     4    (iv)  (A)  for taxable years beginning before January first, two thou-
     5  sand sixteen, if the business income base is not more than  two  hundred
     6  ninety  thousand dollars the amount shall be six and one-half percent of
     7  the business income base; if the business income base is more  than  two
     8  hundred  ninety thousand dollars but not over three hundred ninety thou-
     9  sand dollars the amount shall be the sum of (1) eighteen thousand  eight
    10  hundred  fifty dollars, (2) seven and one-tenth percent of the excess of
    11  the business income base over two hundred ninety  thousand  dollars  but
    12  not  over three hundred ninety thousand dollars and (3) four and thirty-
    13  five hundredths percent of the excess of the business income  base  over
    14  three  hundred  fifty thousand dollars but not over three hundred ninety
    15  thousand dollars;
    16    (B) for taxable years beginning on or after January first,  two  thou-
    17  sand  twenty-five,  if  the  business  income base is not more than four
    18  hundred thousand dollars the amount shall be four percent of  the  busi-
    19  ness  income base; if the business income base is more than four hundred
    20  thousand dollars but not over five hundred thousand dollars  the  amount
    21  shall  be  the sum of (1) sixteen thousand dollars, (2) six and one-half
    22  percent of the excess of the business  income  base  over  four  hundred
    23  thousand  dollars  but  not  over  five hundred thousand dollars and (3)
    24  twenty percent of the excess of  the  business  income  base  over  four

         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD08799-01-3
        S. 4236                             2

     1  hundred  fifty  thousand  dollars  but  not  over  five hundred thousand
     2  dollars;
     3    (C)  for  taxable years beginning on or after January first, two thou-
     4  sand twenty-six, if the business income  base  is  not  more  than  four
     5  hundred thousand dollars the amount shall be two and one-half percent of
     6  the  business income base; if the business income base is more than four
     7  hundred thousand dollars but not over five hundred thousand dollars  the
     8  amount  shall  be  the sum of (1) ten thousand dollars, (2) six and one-
     9  half percent of the excess of the business income base over four hundred
    10  thousand dollars but not over five  hundred  thousand  dollars  and  (3)
    11  thirty-two  percent  of the excess of the business income base over four
    12  hundred fifty thousand  dollars  but  not  over  five  hundred  thousand
    13  dollars.
    14    §  2. Paragraph 39 of subsection (c) of section 612 of the tax law, as
    15  amended by section 1 of part C of chapter 59 of the  laws  of  2022,  is
    16  amended to read as follows:
    17    (39)  (A)  In  the  case  of  a  taxpayer who is a small business or a
    18  taxpayer who is a member, partner, or shareholder of a limited liability
    19  company, partnership, or New York S corporation, respectively, that is a
    20  small business, who or which has business income and/or farm  income  as
    21  defined  in  the  laws  of the United States, an amount equal to fifteen
    22  percent of the net items of income, gain, loss and  deduction  attribut-
    23  able  to  such  business  or  farm  entering into federal adjusted gross
    24  income, but not less than zero.
    25    (B) (i) For the purposes of this paragraph, the  term  small  business
    26  shall  mean:  (I)  a  sole  proprietor  [who employs one or more persons
    27  during the taxable year and] who has net business income  [or  net  farm
    28  income]  of  greater  than zero but less than [two] five hundred [fifty]
    29  thousand dollars;
    30    (II) a limited liability company, partnership, or New  York  S  corpo-
    31  ration  that  during  the taxable year [employs one or more persons and]
    32  has net farm income attributable to a farm business that is greater than
    33  zero but less than [two] five hundred [fifty] thousand dollars; or
    34    (III) a limited liability company, partnership, or New York  S  corpo-
    35  ration  that  during  the taxable year [employs one or more persons and]
    36  has New York gross business income attributable to a  non-farm  business
    37  that  is  greater than zero but less than one million five hundred thou-
    38  sand dollars.
    39    (ii) For purposes of this paragraph, the term New York gross  business
    40  income  shall  mean: (I) in the case of a limited liability company or a
    41  partnership, New York source gross income as defined in subparagraph (B)
    42  of paragraph three of subsection (c) of section six hundred  fifty-eight
    43  of  this  article; and (II) in the case of a New York S corporation, New
    44  York receipts included in the  numerator  of  the  apportionment  factor
    45  determined under section two hundred ten-A of this chapter for the taxa-
    46  ble year.
    47    (C)  To  qualify for this modification in relation to a non-farm small
    48  business that is a limited liability company, partnership, or New York S
    49  corporation, the taxpayer's income  attributable  to  the  net  business
    50  income from its ownership interests in non-farm limited liability compa-
    51  nies,  partnerships,  or New York S corporations must be less than [two]
    52  five hundred [fifty] thousand dollars.
    53    § 3. Paragraph 35 of subdivision (c) of section 11-1712 of the  admin-
    54  istrative  code of the city of New York, as amended by section 2 of part
    55  C of chapter 59 of the laws of 2022, is amended to read as follows:
        S. 4236                             3

     1    (35) (A) In the case of a taxpayer  who  is  a  small  business  or  a
     2  taxpayer who is a member, partner, or shareholder of a limited liability
     3  company, partnership, or New York S corporation, respectively, that is a
     4  small  business,  who or which has business income and/or farm income as
     5  defined  in  the  laws  of the United States, an amount equal to fifteen
     6  percent of the net items of income, gain, loss and  deduction  attribut-
     7  able  to  such  business  or  farm  entering into federal adjusted gross
     8  income, but not less than zero.
     9    (B) (i) For the purposes of this paragraph, the  term  small  business
    10  shall  mean:  (I)  a  sole  proprietor  [who employs one or more persons
    11  during the taxable year and] who has net business income  [or  net  farm
    12  income]  of  greater  than zero but less than [two] five hundred [fifty]
    13  thousand dollars;
    14    (II) a limited liability company, partnership, or New  York  S  corpo-
    15  ration  that  during  the taxable year [employs one or more persons and]
    16  has net farm income that is greater than zero but less than  [two]  five
    17  hundred [fifty] thousand dollars; or
    18    (III)  a  limited liability company, partnership, or New York S corpo-
    19  ration that during the taxable year [employs one or  more  persons  and]
    20  has  New  York gross business income attributable to a non-farm business
    21  that is greater than zero but less than one million five  hundred  thou-
    22  sand dollars.
    23    (ii)  For purposes of this paragraph, the term New York gross business
    24  income shall mean: (I) in the case of a limited liability company  or  a
    25  partnership, New York source gross income as defined in subparagraph (b)
    26  or  paragraph three of subsection (c) of section six hundred fifty-eight
    27  of the tax law, and, (II) in the case of a New York S  corporation,  New
    28  York  receipts  included  in  the  numerator of the apportionment factor
    29  determined under section two hundred ten-A of the tax law for the  taxa-
    30  ble year.
    31    (C)  To  qualify for this modification in relation to a non-farm small
    32  business that is a limited liability company, partnership, or New York S
    33  corporation, the taxpayer's income  attributable  to  the  net  business
    34  income from its ownership interests in non-farm limited liability compa-
    35  nies,  partnerships,  or New York S corporations must be less than [two]
    36  five hundred [fifty] thousand dollars.
    37    § 4. This act shall take effect immediately and shall apply to taxable
    38  years beginning on or after January 1, 2025.