Bill Text: NY S04755 | 2019-2020 | General Assembly | Introduced


Bill Title: Enacts the "Made in New York act"; increases the deduction from the federal gross adjusted income of certain small businesses; grants eligibility for the basic STAR exemption to certain small businesses; and establishes the 3-D program which grants tax benefits to manufacturers which design, develop and manufacture a new product in the state.

Spectrum: Partisan Bill (Republican 3-0)

Status: (Introduced) 2019-03-22 - REFERRED TO BUDGET AND REVENUE [S04755 Detail]

Download: New_York-2019-S04755-Introduced.html


                STATE OF NEW YORK
        ________________________________________________________________________
                                          4755
                               2019-2020 Regular Sessions
                    IN SENATE
                                     March 22, 2019
                                       ___________
        Introduced  by  Sens.  GRIFFO,  ORTT,  SEWARD  -- read twice and ordered
          printed, and when printed to be committed to the Committee  on  Budget
          and Revenue
        AN ACT to enact the "Made in New York act"; and to amend the tax law, in
          relation  to increasing the reduction of federal adjusted gross income
          granted to certain small businesses (Part A); to amend the real  prop-
          erty  tax law, in relation to extending eligibility for the school tax
          relief exemption to certain small businesses (Part B);  and  to  amend
          the  economic  development  law,  in  relation to establishing the 3-D
          program (Part C)
          The People of the State of New York, represented in Senate and  Assem-
        bly, do enact as follows:
     1    Section  1.  Short  title. This act shall be known as the "Made in New
     2  York act".
     3    § 2. This act enacts into law major components of legislation enabling
     4  existing businesses in the state to  compete,  succeed  and  create  new
     5  jobs.  Each  component  is  wholly contained within a Part identified as
     6  Parts A through C. The effective  date  for  each  particular  provision
     7  contained  within  such  Part  is  set forth in the last section of such
     8  Part. Any provision in any section contained within  a  Part,  including
     9  the  effective  date of the Part, which makes reference to a section "of
    10  this act", when used in connection with that particular component, shall
    11  be deemed to mean and refer to the corresponding section of the Part  in
    12  which  it  is  found.  Section  four  of this act sets forth the general
    13  effective date of this act.
    14                                   PART A
    15    Section 1. Paragraph 39 of subsection (c) of section 612  of  the  tax
    16  law,  as added by section 1 of part Y of chapter 59 of the laws of 2013,
    17  is amended to read as follows:
         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD10843-01-9

        S. 4755                             2
     1    (39) In the case of a taxpayer who is a small business who  has  busi-
     2  ness  income  and/or  farm  income  as defined in the laws of the United
     3  States, an amount equal to three percent of the  net  items  of  income,
     4  gain,  loss and deduction attributable to such business or farm entering
     5  into  federal adjusted gross income, but not less than zero, for taxable
     6  years beginning after two thousand thirteen, an amount equal  to  [three
     7  and  three-quarters] five percent of the net items of income, gain, loss
     8  and deduction attributable to such business or farm entering into feder-
     9  al adjusted gross income, but not less  than  zero,  for  taxable  years
    10  beginning after two thousand fourteen, and an amount equal to [five] ten
    11  percent  of  the net items of income, gain, loss and deduction attribut-
    12  able to such business or  farm  entering  into  federal  adjusted  gross
    13  income,  but  not  less than zero, for taxable years beginning after two
    14  thousand fifteen. For the purposes of this  paragraph,  the  term  small
    15  business shall mean a sole proprietor or a farm business who employs one
    16  or  more persons during the taxable year and who has net business income
    17  or net farm income of less than two hundred fifty thousand dollars.
    18    § 2. This act shall take effect immediately.
    19                                   PART B
    20    Section 1. Paragraph (a) of subdivision 2 of section 425 of  the  real
    21  property tax law, as amended by section 1 of part E of chapter 83 of the
    22  laws of 2002, is amended to read as follows:
    23    (a)  Overview.  There shall be two variations of the exemption author-
    24  ized by this section: an exemption for property  owned  by  persons  who
    25  satisfy  or  a  small business which satisfies the criteria set forth in
    26  subdivision three of this section, which shall be known as  the  "basic"
    27  STAR  exemption,  and an exemption for property owned by senior citizens
    28  who satisfy the criteria set forth in both subdivisions three  and  four
    29  of  this section, which shall be known as the "enhanced" STAR exemption.
    30  The exempt amount for each assessing unit shall be  determined  annually
    31  as  set  forth  in this subdivision, by multiplying the "base figure" by
    32  the locally-applicable "sales price differential factor," if any, multi-
    33  plying the product by the  appropriate  "equalization  factor"  for  the
    34  assessing  unit,  and,  if necessary, increasing the result to equal the
    35  applicable "floor." The result is then rounded to the  nearest  multiple
    36  of ten dollars.
    37    §  2. Paragraphs (a), (b) and (b-1) of subdivision 3 of section 425 of
    38  the real property tax law, paragraph (a) as amended by  chapter  264  of
    39  the laws of 2000, paragraph (b) as added by section 1 of part B of chap-
    40  ter 389 of the laws of 1997 and paragraph (b-1) as added by section 1 of
    41  part  FF  of  chapter  57 of the laws of 2010, are amended and three new
    42  paragraphs (a-1), (a-2) and (b-2) are added to read as follows:
    43    (a) Property use. To qualify for exemption pursuant to  this  section,
    44  the property must be a one, two or three family residence, a farm dwell-
    45  ing  [or],  residential property held in condominium or cooperative form
    46  of ownership or the primary place of business of a small business.    If
    47  the  property  is not an eligible type of property, but a portion of the
    48  property is partially used by the owner as  a  primary  residence,  that
    49  portion  which is so used shall be entitled to the exemption provided by
    50  this section; provided that in no event shall the exemption  exceed  the
    51  assessed value attributable to that portion.
    52    (a-1)  Small  business.  To  qualify for an exemption pursuant to this
    53  section, a small business must be a business entity, other than  a  sole

        S. 4755                             3
     1  proprietorship, which employs not less than two employees, nor more than
     2  fifty employees at its primary place of business.
     3    (a-2)  Person.  For  the purposes of this section, "person" or "owner"
     4  shall include a small business.
     5    (b) Primary residence. The property must serve as  the  primary  resi-
     6  dence  of  one or more of the owners thereof, or as the primary place of
     7  business of a small business.
     8    (b-1) Income. For final assessment rolls to be used for  the  levy  of
     9  taxes  for  the  two thousand eleven-two thousand twelve school year and
    10  thereafter, [the] a residential parcel's affiliated  income  may  be  no
    11  greater than five hundred thousand dollars, as determined by the commis-
    12  sioner  of taxation and finance pursuant to section one hundred seventy-
    13  one-u of the tax law, in order to be eligible for  the  basic  exemption
    14  authorized by this section. As used herein, the term "affiliated income"
    15  shall  mean  the  combined income of all of the owners of the parcel who
    16  resided primarily thereon on the applicable taxable status date, and  of
    17  any  owners' spouses residing primarily thereon. For exemptions on final
    18  assessment rolls to be used for the levy of taxes for the  two  thousand
    19  eleven-two  thousand  twelve  school  year,  affiliated  income shall be
    20  determined based upon the parties'  incomes  for  the  income  tax  year
    21  ending  in two thousand nine. In each subsequent school year, the appli-
    22  cable income tax year shall be advanced by one year. The  term  "income"
    23  as  used  herein  shall  have the same meaning as in subdivision four of
    24  this section.
    25    (b-2) Primary place of business. For small  businesses,  the  property
    26  shall  be property at a single location within the state, upon which the
    27  small business carries on its business enterprise.
    28    § 3. Paragraph (a) of subdivision 5 of section 425 of the real proper-
    29  ty tax law, as amended by section 5 of part E of chapter 83 of the  laws
    30  of 2002, is amended to read as follows:
    31    (a)  Generally.  Every  school  district  shall notify, or cause to be
    32  notified, each person owning residential real property  and  each  small
    33  business  owning  real property in the school district of the provisions
    34  of this section. The provisions of this subdivision  may  be  met  by  a
    35  notice  sent to such persons in substantially the following form: "Resi-
    36  dential and small business real  property  may  qualify  for  a  partial
    37  exemption from school district taxes under the New York state school tax
    38  relief  (STAR)  program. To receive such exemption, owners of qualifying
    39  property must file an application with their local assessor on or before
    40  the applicable taxable status date.   For  further  information,  please
    41  contact your local assessor."
    42    § 4. Paragraph (a) of subdivision 6 of section 425 of the real proper-
    43  ty  tax law, as amended by section 1 of part A of chapter 60 of the laws
    44  of 2016, is amended to read as follows:
    45    (a) Generally. All owners of the property who primarily reside thereon
    46  and who are not subject to the provisions of subdivision sixteen of this
    47  section must jointly or, in the case of a small business, the  owner  or
    48  owners  thereof must file an application for exemption with the assessor
    49  on or before the appropriate taxable status date. Such  application  may
    50  be  filed  by  mail  if  it  is enclosed in a postpaid envelope properly
    51  addressed to the appropriate assessor, deposited in  a  post  office  or
    52  official depository under the exclusive care of the United States postal
    53  service, and postmarked by the United States postal service on or before
    54  the  applicable taxable status date. Each such application shall be made
    55  on a form prescribed by the commissioner, which shall require the appli-
    56  cant or applicants to agree to notify  the  assessor  if  their  primary

        S. 4755                             4
     1  residence  or  primary place of business changes while their property is
     2  receiving the exemption. The assessor may request that proof of residen-
     3  cy be submitted with  the  application.  If  the  applicant  requests  a
     4  receipt from the assessor as proof of submission of the application, the
     5  assessor  shall  provide  such receipt. If such request is made by other
     6  than personal request, the applicant shall provide the assessor  with  a
     7  self-addressed postpaid envelope in which to mail the receipt.
     8    §  5.  Subdivision  10 of section 425 of the real property tax law, as
     9  added by section 1 of part B of chapter 389 of the laws of  1997,  para-
    10  graph  (a)  as further amended by subdivision (b) of section 1 of part W
    11  of chapter 56 of the laws of 2010, is amended to read as follows:
    12    10. Proof of residency. (a) Requests. From time to time, the  assessor
    13  may  request  proof  of  residency or proof of primary place of business
    14  from the owner or owners of any property which  is  exempt  pursuant  to
    15  this section. In addition, the assessor shall request proof of residency
    16  or  primary  place  of  business  from  any  such  owner  or owners when
    17  requested to do so by the commissioner.
    18    (b) Timing. A request for proof of residency or primary place of busi-
    19  ness shall be mailed at least sixty days prior to  the  ensuing  taxable
    20  status  date.  The owner or owners shall submit proof of their residency
    21  or primary place of business to the assessor on or  before  the  ensuing
    22  taxable status date.
    23    (c)  Review  of submission. The burden shall be on the owner or owners
    24  to establish that the property is their  primary  residence  or  primary
    25  place  of business.   If they submit proof of residency or primary place
    26  of business on or before  the  ensuing  taxable  status  date,  and  the
    27  submission demonstrates to the assessor's satisfaction that the property
    28  is  the primary residence or primary place of business of one or more of
    29  the owners thereof, and if the requirements of this section  are  other-
    30  wise  satisfied,  the  exemption shall continue in effect on the ensuing
    31  tentative assessment roll.   Otherwise, the assessor  shall  discontinue
    32  the  exemption on the next ensuing tentative assessment roll as provided
    33  [herein] in this section,  and,  where  appropriate,  shall  proceed  as
    34  further provided [herein] in this section.
    35    §  6.  Subparagraph  (i) of paragraph (a) of subdivision 11 of section
    36  425 of the real property tax law, as added by section 1  of  part  B  of
    37  chapter 389 of the laws of 1997, is amended to read as follows:
    38    (i)  the property may not be the primary residence or primary place of
    39  business of the owner or owners who applied for the exemption,
    40    § 7. Subparagraph (iii) of paragraph (b) of subdivision 14 of  section
    41  425  of  the  real  property tax law, as added by section 1 of part J of
    42  chapter 57 of the laws of 2013, is amended to read as follows:
    43    (iii) the property does not serve as  the  primary  residence  or  the
    44  primary place of business of any of its owners;
    45    § 8. This act shall take effect immediately and shall apply to taxable
    46  years beginning on or after January 1, 2020.
    47                                   PART C
    48    Section  1.  The  economic  development law is amended by adding a new
    49  article 24 to read as follows:
    50                                 ARTICLE 24
    51                                 3-D PROGRAM
    52  Section 500. Short title.

        S. 4755                             5
     1          501. Eligibility criteria for manufacturers.
     2          502. Tax benefits.
     3    §  500.  Short  title. This article shall be known and may be cited as
     4  the "Dreamed in New York, Designed in New York and Developed in New York
     5  program" or the "3-D program".
     6    § 501. Eligibility criteria for manufacturers. 1. In order to  partic-
     7  ipate  in the 3-D program, a business that manufactures a product within
     8  the state shall satisfy all of the following criteria:
     9    (a) the manufacturer designed and developed a new product  within  the
    10  state;
    11    (b) the manufacturer manufactures such new product in this state;
    12    (c)  the  manufacturer's primary place for the manufacture of such new
    13  product is in the state; and
    14    (d) the commissioner shall have certified that such  manufacturer  has
    15  satisfied the requirements of paragraphs (a), (b) and (c) of this subdi-
    16  vision,  and  shall  have certified the location or locations within the
    17  state at which the new product is manufactured.
    18    2. An eligible business may be organized as a corporation, a  partner-
    19  ship, a limited liability company or a sole proprietorship.
    20    3.  A  business  must  be in compliance with all worker protection and
    21  environmental laws and regulations. In addition, a  business  shall  not
    22  owe any past due federal, state or municipal taxes.
    23    §  502. Tax benefits. A business that is certified by the commissioner
    24  to be eligible to participate in the 3-D program and its employees shall
    25  be entitled to all benefits granted to participants in the  START-UP  NY
    26  program  pursuant  to  article  twenty-one of this chapter and any other
    27  provision of law related thereto.
    28    § 2. This act shall take effect immediately and shall apply  to  taxes
    29  imposed on or after January 1, 2020.
    30    § 3. Severability clause. If any clause, sentence, paragraph, subdivi-
    31  sion,  section  or  part  of  this act shall be adjudged by any court of
    32  competent jurisdiction to be invalid, such judgment  shall  not  affect,
    33  impair,  or  invalidate  the remainder thereof, but shall be confined in
    34  its operation to the clause, sentence, paragraph,  subdivision,  section
    35  or part thereof directly involved in the controversy in which such judg-
    36  ment shall have been rendered. It is hereby declared to be the intent of
    37  the  legislature  that  this  act  would  have been enacted even if such
    38  invalid provisions had not been included herein.
    39    § 4. This act shall take effect immediately; provided,  however,  that
    40  the  applicable effective date of Parts A through C of this act shall be
    41  as specifically set forth in the last section of such Parts.
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