Bill Text: NY S08115 | 2023-2024 | General Assembly | Amended

NOTE: There are more recent revisions of this legislation. Read Latest Draft

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Bill Title: Relates to the timing of annual tax elections and the amount of the required installments.

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Introduced) 2024-05-08 - ADVANCED TO THIRD READING [S08115 Detail]

Download: New_York-2023-S08115-Amended.html

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                STATE OF NEW YORK
        ________________________________________________________________________

                                         8115--A

                    IN SENATE

                                     January 8, 2024
                                       ___________

        Introduced  by  Sen. SKOUFIS -- read twice and ordered printed, and when
          printed to be committed to the Committee on Investigations and Govern-
          ment  Operations  --  committee  discharged,  bill  amended,   ordered
          reprinted as amended and recommitted to said committee

        AN  ACT  to  amend  the tax law, in relation to the timing of annual tax
          elections

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

     1    Section 1. Subsection (c) of section 861 of the tax law, as amended by
     2  section  2  of subpart C of part J of chapter 59 of the laws of 2023, is
     3  amended to read as follows:
     4    (c) [The] For taxable years beginning before January first, two  thou-
     5  sand  twenty-four, the annual election must be made on or before the due
     6  date of the first estimated payment under section eight  hundred  sixty-
     7  four  of this article and will take effect for the current taxable year,
     8  and for taxable years beginning on or after January first, two  thousand
     9  twenty-four,  such  election  must be made by September fifteenth of the
    10  taxable year for which such election is being made.  Only  one  election
    11  may  be  made  during  each  calendar  year. An election made under this
    12  section is irrevocable after the due date.
    13    § 2. Subsection (b) of section 864 of the tax law, as added by section
    14  1 of part C of chapter 59 of the laws of 2021, paragraph 3 as amended by
    15  chapter 555 of the laws of 2022, is amended to read as follows:
    16    (b) General. The estimated tax shall be paid as follows for an  elect-
    17  ing partnership and an electing S corporation:
    18    (1)  The  estimated  tax  shall  be paid in four equal installments on
    19  March  fifteenth,  June  fifteenth,  September  fifteenth  and  December
    20  fifteenth  in  the calendar year prior to the year in which the due date
    21  of the return required by this article falls.
    22    (2) Amount of required installment. (A) The  amount  of  any  required
    23  installment shall be twenty-five percent of the required annual payment.
    24    (B)  In the case of any required installment, if the electing partner-
    25  ship or the electing  S  corporation  establishes  that  the  annualized
    26  income  installment  determined under subparagraph (B) of paragraph four

         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD13841-03-4
        S. 8115--A                          2

     1  of subsection (c) of section six hundred eighty-five of this chapter  is
     2  less  than  the  amount  determined under subparagraph (A) of this para-
     3  graph, the annualized income installment shall be the required  install-
     4  ment.  Any reduction in a required installment resulting from the appli-
     5  cation of this subparagraph shall be recaptured by increasing the amount
     6  of the next required installment determined under this paragraph by  the
     7  amount of such reduction, and by increasing successive required install-
     8  ments as necessary to effect full recapture.
     9    (3)  [Notwithstanding  paragraph four of subsection (c) of section six
    10  hundred eighty-five of this chapter, the] The required annual payment is
    11  the lesser of: (A) ninety percent of the tax shown on the return for the
    12  taxable year; or (B) one hundred percent of the tax shown on the  return
    13  of  the electing partnership or electing S corporation for the preceding
    14  taxable year.
    15    (4) Without regard to paragraphs one and two of this subsection, if an
    16  election is made on or after March fifteenth and before  June  fifteenth
    17  of  the taxable year for which such election is made, the electing part-
    18  nership or electing S corporation is required to make an  estimated  tax
    19  payment  with  such  election  in  an amount equal to the first required
    20  installment and if an election is made on or after  June  fifteenth  and
    21  before  September  fifteenth of the taxable year for which such election
    22  is made, the electing partnership or electing S corporation is  required
    23  to  make  an estimated tax payment with such election in an amount equal
    24  to the sum of the first and second required installments.
    25    § 3. Subsection (c) of section 868 of  the  tax  law,  as  amended  by
    26  section  7  of subpart C of part J of chapter 59 of the laws of 2023, is
    27  amended to read as follows:
    28    (c) [The annual election to be taxed pursuant to this article must  be
    29  made  on  or  before  the  due date of the first estimated payment under
    30  section eight hundred sixty-four of this chapter and  will  take  effect
    31  for the current taxable year.] Only one election to be taxed pursuant to
    32  this  article  may  be  made during each calendar year. An election made
    33  under this section is irrevocable after such due date. To the extent  an
    34  election  made  under section eight hundred sixty-one of this chapter is
    35  revoked or otherwise invalidated an election made under this section  is
    36  automatically invalidated.
    37    § 4. Subsection (b) of section 871 of the tax law, as added by section
    38  1 of subpart B of part MM of chapter 59 of the laws of 2022, paragraph 3
    39  as  amended  by  chapter  555 of the laws of 2022, is amended to read as
    40  follows:
    41    (b) General. Except as provided in subsection (c) of this section, the
    42  estimated tax shall be paid as follows for an electing city  partnership
    43  and an electing city resident S corporation:
    44    (1)  The  estimated  tax  shall  be paid in four equal installments on
    45  March  fifteenth,  June  fifteenth,  September  fifteenth  and  December
    46  fifteenth  in  the calendar year prior to the year in which the due date
    47  of the return required by this article falls.
    48    (2) Amount of required installment. (A) The  amount  of  any  required
    49  installment shall be twenty-five percent of the required annual payment.
    50    (B)  In  the  case  of  any required installment, if the electing city
    51  partnership or the electing city resident S corporation establishes that
    52  the annualized income installment determined under subparagraph  (B)  of
    53  paragraph  four  of subsection (c) of section six hundred eighty-five of
    54  this chapter is less than the amount determined under  subparagraph  (A)
    55  of  this  paragraph,  the  annualized  income  installment  shall be the
    56  required installment. Any reduction in a required installment  resulting
        S. 8115--A                          3

     1  from  the  application  of  this  subparagraph  shall  be  recaptured by
     2  increasing the amount of the next required installment determined  under
     3  this  paragraph  by  the  amount  of  such  reduction, and by increasing
     4  successive required installments as necessary to effect full recapture.
     5    (3) [Without regard to paragraph four of subsection (c) of section six
     6  hundred eighty-five of this chapter, the] The required annual payment is
     7  the lesser of: (A) ninety percent of the tax shown on the return for the
     8  taxable  year; or (B) one hundred percent of the tax shown on the return
     9  of the electing city partnership or electing city resident S corporation
    10  for the preceding taxable year.
    11    (4) Without regard to paragraphs one and two of this subsection, if an
    12  election is made on or after March fifteenth and before  June  fifteenth
    13  of  the taxable year for which such election is made, the electing part-
    14  nership or electing S corporation is required to make an  estimated  tax
    15  payment  with  such  election  in  an amount equal to the first required
    16  installment, and if an election is made on or after June  fifteenth  and
    17  before  September  fifteenth of the taxable year for which such election
    18  is made, the electing partnership or electing S corporation is  required
    19  to  make  an estimated tax payment with such election in an amount equal
    20  to the sum of the first and second required installments.
    21    § 5. This act shall take effect immediately and shall apply to taxable
    22  years beginning on or after January 1, 2024.