Bill Text: NY S01244 | 2023-2024 | General Assembly | Introduced
Bill Title: Creates the middle class circuit breaker tax credit allowing a credit against personal income tax, equal to seventy percent of the amount by which the taxpayer's net real property tax or the taxpayer's real property tax equivalent exceeds the taxpayer's maximum real property tax; establishes a tax reform study commission.
Spectrum: Partisan Bill (Democrat 4-0)
Status: (Introduced) 2024-01-03 - REFERRED TO BUDGET AND REVENUE [S01244 Detail]
Download: New_York-2023-S01244-Introduced.html
STATE OF NEW YORK ________________________________________________________________________ 1244 2023-2024 Regular Sessions IN SENATE January 11, 2023 ___________ Introduced by Sens. KRUEGER, BAILEY, LIU, SALAZAR -- 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, 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 (bbb) to read as follows: 3 (bbb) 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 24 section nine hundred eleven of the internal revenue code; support money EXPLANATION--Matter in italics (underscored) is new; matter in brackets [] is old law to be omitted. LBD03735-01-3S. 1244 2 1 not included in adjusted gross income; nontaxable strike benefits; 2 supplemental security income payments; the gross amount of any pension 3 or annuity benefits to the extent not included in such adjusted gross 4 income (including, but not limited to, railroad retirement benefits and 5 all payments received under the federal social security act and veter- 6 ans' disability pensions); nontaxable interest received from the state 7 of New York, its agencies, instrumentalities, public corporations, or 8 political subdivisions (including a public corporation created pursuant 9 to agreement or compact with another state or Canada); workers' compen- 10 sation; the gross amount of "loss-of-time" insurance; and the amount of 11 cash public assistance and relief, other than medical assistance for the 12 needy, paid to or for the benefit of the qualified taxpayer or members 13 of his or her household. Household gross income shall not include 14 surplus foods or other relief in kind or payments made to individuals 15 because of their status as victims of Nazi persecution as defined in 16 public law 103-286 or any disability compensation received by veterans 17 on account of injury or illness incurred or aggravated during military 18 service in the wars in Afghanistan and Iraq since September eleventh, 19 two thousand one. Provided, further, household gross income shall only 20 include all such income received by all members of the household while 21 members of such household. 22 (D) "Adjusted rent" means rent paid for the right of occupancy of a 23 residence. 24 (E) "Real property tax equivalent" means (i) for taxable years begin- 25 ning in two thousand twenty-five, fifteen percent of the adjusted rent 26 actually paid in the taxable year by a household solely for the right of 27 occupancy of its New York residence for the taxable year. If (I) a resi- 28 dence is rented to two or more individuals as cotenants, or such indi- 29 viduals share in the payment of a single rent for the right of occupancy 30 of such residence, and (II) each of such individuals is a member of a 31 different household, one or more of which individuals shares such resi- 32 dence, real property tax equivalent is that portion of fifteen percent 33 of the adjusted rent paid in the taxable year which reflects that 34 portion of the rent attributable to the qualified taxpayer and the 35 members of his or her household; and (i) for taxable years beginning in 36 two thousand twenty-five and thereafter, twenty percent of the adjusted 37 rent actually paid in the taxable year by a household solely for the 38 right of occupancy of its New York residence for the taxable year. If 39 (I) a residence is rented to two or more individuals as cotenants, or 40 such individuals share in the payment of a single rent for the right of 41 occupancy of such residence, and (II) each of such individuals is a 42 member of a different household, one or more of which individuals shares 43 such residence, real property tax equivalent is that portion of twenty 44 percent of the adjusted rent paid in the taxable year which reflects 45 that portion of the rent attributable to the qualified taxpayer and the 46 members of his or her household. 47 (F) "Net real property tax" means the real property taxes assessed on 48 the residential real property owned and occupied by the taxpayer or 49 taxpayers after any exemption or abatement received pursuant to the real 50 property tax law. 51 (2) Credit. A qualified taxpayer shall be allowed a credit against the 52 taxes imposed by this article, equal to seventy percent of the amount by 53 which the taxpayer's net real property tax or the taxpayer's real prop- 54 erty tax equivalent exceeds the taxpayer's maximum real property tax, as 55 determined by paragraph three of this subsection. If such credit exceeds 56 the tax for such taxable year, as reduced by the other credits permittedS. 1244 3 1 by this article, the qualified taxpayer may receive, and the comp- 2 troller, subject to a certificate of the department, shall pay as an 3 overpayment, without interest, any excess between such tax as so reduced 4 and the amount of the credit. If a qualified taxpayer is not required to 5 file a return pursuant to section six hundred fifty-one of this article, 6 a qualified taxpayer may nevertheless receive and the comptroller, 7 subject to a certificate of the department, shall pay as an overpayment 8 the full amount of the credit, without interest. 9 (3) Maximum real property tax. (A) A qualified taxpayer's maximum real 10 property tax shall be determined as follows: 11 (i) For tax years beginning in two thousand twenty-five: 12 Household gross income Maximum real property tax 13 One hundred thousand Nine percent of the 14 dollars or less household gross income 15 More than one hundred No limitation. 16 thousand dollars 17 (ii) For tax years beginning in two thousand twenty-six: 18 Household gross income Maximum real property tax 19 One hundred thousand Eight and one-half percent of the 20 dollars or less household gross income 21 More than one hundred No limitation. 22 thousand dollars 23 (iii) For tax years beginning in two thousand twenty-seven: 24 Household gross income Maximum real property tax 25 One hundred thousand dollars Seven and one-half percent of 26 or less household gross income 27 More than one hundred thousand Seven and one-half percent of 28 dollars, but less than or equal to one hundred thousand dollars 29 one hundred fifty thousand dollars plus eight and one-half percent of 30 household gross income above 31 one hundred thousand dollars 32 More than one hundred fifty No limitation. 33 thousand dollars 34 (iv) For tax years beginning in two thousand twenty-eight and there- 35 after: 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 forS. 1244 4 1 inflation for tax years beginning in two thousand twenty-nine 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, 2027, 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.
