Bill Text: NY S05573 | 2023-2024 | General Assembly | Amended
Bill Title: Provides for the advance payment of the earned income tax credit to qualifying employees.
Spectrum: Partisan Bill (Democrat 2-0)
Status: (Introduced) 2024-01-03 - REFERRED TO BUDGET AND REVENUE [S05573 Detail]
Download: New_York-2023-S05573-Amended.html
STATE OF NEW YORK ________________________________________________________________________ 5573--A 2023-2024 Regular Sessions IN SENATE March 8, 2023 ___________ Introduced by Sens. GOUNARDES, MYRIE -- read twice and ordered printed, and when printed to be committed to the Committee on Budget and Reven- ue -- committee discharged, bill amended, ordered reprinted as amended and recommitted to said committee AN ACT to amend the tax law, in relation to providing for the advance payment of the earned income tax credit The People of the State of New York, represented in Senate and Assem- bly, do enact as follows: 1 Section 1. Paragraph 1 of subsection (d) of section 606 of the tax 2 law, as amended by section 1 of part Q of chapter 63 of the laws of 3 2000, is amended and a new paragraph 9 is added to read as follows: 4 (1) General. A taxpayer shall be allowed a credit as provided herein 5 equal to (i) the applicable percentage of the earned income credit 6 allowed under section thirty-two of the internal revenue code for the 7 same taxable year, (ii) reduced by the credit permitted under subsection 8 (b) of this section. Provided, however, for taxable years beginning in 9 two thousand twenty-five and thereafter, for the purpose of determining 10 the amount of tax credit under this paragraph, in calculating the earned 11 income tax credit allowed under section thirty-two of the internal 12 revenue code, the phaseout amount as referenced in section 32(b)(2)(A) 13 of the internal revenue code shall be read as twenty-four thousand nine 14 hundred sixty dollars instead of eleven thousand six hundred ten dollars 15 and such phaseout amount shall be subject to adjustments made in section 16 thirty-two of the internal revenue code (the calendar year referenced in 17 the cost of living adjustment in section 32(j)(1)(B) of the internal 18 revenue code shall be applied as calendar year two thousand twenty-five 19 with respect to the phaseout amounts), including an additional phaseout 20 amount for a joint filer and inflation adjustment specified in such 21 section of the internal revenue code for taxable years beginning in two 22 thousand twenty-five and thereafter. EXPLANATION--Matter in italics (underscored) is new; matter in brackets [] is old law to be omitted. LBD09953-06-3S. 5573--A 2 1 The applicable percentage shall be (i) seven and one-half percent for 2 taxable years beginning in nineteen hundred ninety-four, (ii) ten 3 percent for taxable years beginning in nineteen hundred ninety-five, 4 (iii) twenty percent for taxable years beginning after nineteen hundred 5 ninety-five and before two thousand, (iv) twenty-two and one-half 6 percent for taxable years beginning in two thousand, (v) twenty-five 7 percent for taxable years beginning in two thousand one, (vi) twenty- 8 seven and one-half percent for taxable years beginning in two thousand 9 two, [and] (vii) thirty percent for taxable years beginning in two thou- 10 sand three, (viii) thirty-five percent for taxable years beginning in 11 two thousand twenty-five, and (ix) forty percent for taxable years 12 beginning in two thousand twenty-six and thereafter. For taxable years 13 beginning in two thousand twenty-five and thereafter, in the case of an 14 eligible individual with no qualifying children, the credit percentage 15 shall be fifteen and three-tenths to determine the amount of the earned 16 income tax credit referenced in section 32(b)(1) of the internal revenue 17 code and the earned income amount and the phaseout amount of such indi- 18 vidual shall be determined as if such earned income amount and phaseout 19 amount as referenced in section 32(b)(2)(A) of the internal revenue code 20 are equal to the amount allowed for an eligible individual with one 21 qualifying child as such amounts are referenced in such paragraph. 22 Provided further, for the purpose of this subsection, an eligible indi- 23 vidual shall be an individual who has attained nineteen years of age as 24 opposed to twenty-five years of age, irrespective of the eligibility 25 referenced in section 32(c)(1)(A)(ii)(II) of the internal revenue code. 26 Furthermore, an individual otherwise eligible but for the requirement 27 under section 32(m) of the internal revenue code shall be eligible for 28 this credit. Provided, however, that if the reversion event, as defined 29 in this paragraph, occurs, the applicable percentage shall be twenty 30 percent for taxable years ending on or after the date on which the 31 reversion event occurred. The reversion event shall be deemed to have 32 occurred on the date on which federal action, including but not limited 33 to, administrative, statutory or regulatory changes, materially reduces 34 or eliminates New York state's allocation of the federal temporary 35 assistance for needy families block grant, or materially reduces the 36 ability of the state to spend federal temporary assistance for needy 37 families block grant funds for the earned income credit or to apply 38 state general fund spending on the earned income credit toward the 39 temporary assistance for needy families block grant maintenance of 40 effort requirement, and the commissioner of the office of temporary and 41 disability assistance shall certify the date of such event to the 42 commissioner of taxation and finance, the director of the division of 43 the budget, the speaker of the assembly and the temporary president of 44 the senate. 45 (9) Individuals over age sixty-five. Notwithstanding the provisions of 46 section 32(c)(1)(A)(ii)(III) of the internal revenue code, an individual 47 who is otherwise eligible to receive the earned income credit under this 48 subsection shall not be deemed ineligible due solely to the fact that 49 such individual has attained the age of sixty-five. 50 § 2. The tax law is amended by adding a new section 679 to read as 51 follows: 52 § 679. Advance payment of earned income credit. (a) General rule. 53 Except as otherwise provided in this chapter, the commissioner shall 54 provide for the prepayment of the earned income credit to qualifying 55 employees.S. 5573--A 3 1 (b) Earned income eligibility certificate. For purposes of this arti- 2 cle, an earned income eligibility certificate is a statement furnished 3 by an employee to the commissioner which: 4 (1) certifies that the employee will be eligible to receive an earned 5 income credit or an enhanced earned income credit provided pursuant to 6 subsection (d) or (d-1) of section six hundred six of this article for 7 the taxable year; 8 (2) certifies that the employee does not have an earned income eligi- 9 bility certificate in effect for the taxable year with respect to the 10 payment of wages by another employer; and 11 (3) states whether the employee's spouse has an earned income eligi- 12 bility certificate in effect. For purposes of this section, a certif- 13 icate shall be treated as being in effect with respect to a spouse if 14 such certificate will be in effect on the first status determination 15 date following the date on which the other eligible spouse furnishes the 16 statement in question. 17 (c) Earned income advance amount. Four advanced payments shall be made 18 to such qualifying employees. An estimated annual tax credit shall be 19 determined by the commissioner in advance of the first payment and shall 20 be subject to adjustment due to changes in employment or family status 21 over the course of the year. Prior to disbursement, the commissioner 22 shall ensure that the qualifying employee's status has not changed. The 23 first three advanced payments shall be made during the taxable year and 24 shall be twenty percent of the anticipated credit. The fourth advanced 25 payment shall be made after the tax year is over and shall be adjusted 26 to match the actual credit due eligible. Such payments shall, to the 27 extent practicable, be made available via direct deposit and via elec- 28 tronic benefit transfer (EBT) card. 29 (d) Form and contents of certificate. Earned income eligibility 30 certificates shall be in such form and contain such information as the 31 commissioner may determine and prescribe. 32 (e) Notification. (1) The commissioner shall notify all taxpayers who 33 have received a refund of the credit pursuant to subsection (d) or (d-1) 34 of section six hundred six of this article based on the most recent tax 35 return or record in writing of the availability of earned income advance 36 amounts under this section. Such written or electronic notification 37 shall include a clearly labeled section or withholding forms and a sepa- 38 rate handout with information about the advanced payment of the earned 39 income credit in the six most common languages spoken by individuals in 40 this state. 41 (2) The commissioner shall provide information on the availability of 42 earned income advance amounts under this section to tax preparers, 43 accountants and organizations that assist individuals in tax prepara- 44 tion. Such information shall be distributed to qualifying individuals. 45 (f) Coordination with advance payments of earned income credit. (1) If 46 any payment is made to the individual by the department under this 47 section during any calendar year, the tax imposed by this chapter for 48 the individual's last taxable year beginning in such calendar year shall 49 be increased by the aggregate amount of such payments. 50 (2) If an individual establishes that they are requesting and receiv- 51 ing payments under this section in good faith by establishing that they 52 properly claimed payments under this section in the prior year and that 53 they have has not experienced a substantial change in circumstances such 54 that they have a reasonable expectation of eligibility in the current 55 year, then paragraph one of this subsection shall not apply.S. 5573--A 4 1 (3) Any increase in tax under this subsection shall not be treated as 2 tax imposed by this chapter for purposes of determining the amount of 3 any credit, other than the credit allowed by subsection (d) or (d-1) of 4 section six hundred six of this article, allowable under this article. 5 § 3. This act shall take effect immediately and shall apply to taxable 6 years beginning on or after January 1, 2025.
