senate Bill S5016A

Amended

Includes New York exemptions of a resident individual within the cost of living adjustment and makes adjustment applicable to tax years beginning on or after 1/1/13

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Bill Status


  • Introduced
  • In Committee
  • On Floor Calendar
    • Passed Senate
    • Passed Assembly
  • Delivered to Governor
  • Signed/Vetoed by Governor
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actions

  • 02 / May / 2011
    • REFERRED TO INVESTIGATIONS AND GOVERNMENT OPERATIONS
  • 20 / May / 2011
    • AMEND AND RECOMMIT TO INVESTIGATIONS AND GOVERNMENT OPERATIONS
  • 20 / May / 2011
    • PRINT NUMBER 5016A
  • 07 / Jun / 2011
    • REPORTED AND COMMITTED TO FINANCE
  • 04 / Jan / 2012
    • REFERRED TO INVESTIGATIONS AND GOVERNMENT OPERATIONS
  • 05 / Jan / 2012
    • AMEND AND RECOMMIT TO INVESTIGATIONS AND GOVERNMENT OPERATIONS
  • 05 / Jan / 2012
    • PRINT NUMBER 5016B
  • 04 / May / 2012
    • AMEND (T) AND RECOMMIT TO INVESTIGATIONS AND GOVERNMENT OPERATIONS
  • 04 / May / 2012
    • PRINT NUMBER 5016C
  • 31 / May / 2012
    • REPORTED AND COMMITTED TO FINANCE

Summary

Includes New York exemptions of a resident individual within the cost of living adjustment; makes such adjustment applicable to tax years beginning on or after January 1, 2013.

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Bill Details

Versions:
S5016
S5016A
S5016B
S5016C
Legislative Cycle:
2011-2012
Current Committee:
Senate Finance
Law Section:
Tax Law
Laws Affected:
Amd ยงยง601, 614 & 616, Tax L

Votes

7
0
7
Aye
0
Nay
1
aye with reservations
0
absent
0
excused
0
abstained
show Investigations and Government Operations committee vote details

Sponsor Memo

BILL NUMBER:S5016A

TITLE OF BILL:
An act
to amend the tax law, in relation to the imposition of personal income
tax

PURPOSE:
To adjust the taxable income brackets, the standard deduction and the
dependent exemption under the personal income tax to the rate of
inflation.

SUMMARY OF PROVISIONS:
Section 1 amends section 601 of the Tax Law to adjust the rate
brackets for each personal income tax filing type for the rate of
inflation.

Section 2 amends section 601 of the Tax Law to change the calculation
of the tax benefit recapture to adjust the applicable income levels
by the rate of inflation.

Section 3 amends section 614 of the Tax Law to provide for a cost of
living adjustment equal to the rate of inflation for the standard
deduction.

Section 4 amends section 616 of the Tax Law to provide a cost of
living adjustment equal to the rate of inflation for the dependent
exemption.

JUSTIFICATION:
The Federal Government provides for a cost of living adjustment in
relation to the imposition of the personal income tax at the federal
level. This cost of living adjustment applies to the taxable income
levels to which the tax rates apply, the standard deduction and the
personal exemption.
By utilizing this cost of living adjustment, the "bracket creep" is
eliminated which forces a taxpayer into a higher income tax bracket
as a result of his income increasing due to inflation.

The personal income tax in New York does not currently include a cost
of living adjustment for the rate brackets, standard deduction or the
dependent deduction. The last time the rate brackets were adjusted
was in 1996. The standard deduction was adjusted in 2006 only for
married taxpayers to eliminate the marriage penalty. Other than that
adjustment, the standard deduction has not been changed since 1996.
The dependent exemption, which is set at $1,000 per dependent, has
not been changed since 1987. In comparison, the Federal government
exemption is equal to $3,650 per dependent.

LEGISLATIVE HISTORY:
New bill.

FISCAL IMPLICATIONS:
$230M in fiscal year 2011-12; $265M when fully effective.

EFFECTIVE DATE:


Applies to tax years beginning on or after January 1, 2011.

view bill text
                    S T A T E   O F   N E W   Y O R K
________________________________________________________________________

                                 5016--A

                       2011-2012 Regular Sessions

                            I N  S E N A T E

                               May 2, 2011
                               ___________

Introduced  by  Sens. DeFRANCISCO, SKELOS, LARKIN, MAZIARZ, RANZENHOFER,
  SEWARD, ZELDIN -- read twice and ordered printed, and when printed  to
  be  committed  to the Committee on Investigations and Government Oper-
  ations -- committee discharged, bill  amended,  ordered  reprinted  as
  amended and recommitted to said committee

AN  ACT  to amend the tax law, in relation to the imposition of personal
  income tax

  THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
BLY, DO ENACT AS FOLLOWS:

  Section  1.  Section  601  of  the  tax law is amended by adding a new
subsection (c-1) to read as follows:
  (C-1) COST OF LIVING ADJUSTMENT.  FOR TAXABLE YEARS BEGINNING  ON  AND
AFTER JANUARY FIRST, TWO THOUSAND ELEVEN, THE MINIMUM AND MAXIMUM DOLLAR
AMOUNT  FOR  EACH  RATE  BRACKET  FOR  WHICH  A  TAX  IS  IMPOSED  UNDER
SUBSECTIONS (A), (B) AND (C) OF THIS SECTION SHALL BE INCREASED FOR  THE
COST  OF  LIVING  ADJUSTMENT. FOR THE PURPOSES OF THIS SUBPARAGRAPH, THE
COST OF LIVING ADJUSTMENT FOR ANY TAXABLE YEAR SHALL BE  THE  PERCENTAGE
(IF  ANY)  BY  WHICH THE CPI FOR THE PRECEDING CALENDAR YEAR EXCEEDS THE
CPI FOR CALENDAR YEAR TWO THOUSAND NINE.   THE CPI  IS  DEFINED  AS  THE
AVERAGE OF THE CONSUMER PRICE INDEX FOR ALL URBAN CONSUMERS PUBLISHED BY
THE  UNITED  STATES  DEPARTMENT  OF  LABOR AS OF THE CLOSE OF THE TWELVE
MONTH PERIOD ENDING AUGUST THIRTY-FIRST OF SUCH CALENDAR  YEAR.  IF  ANY
INCREASE  DETERMINED  UNDER  THIS  SUBPARAGRAPH IS NOT A MULTIPLE OF ONE
HUNDRED DOLLARS, SUCH INCREASE SHALL BE  ROUNDED  TO  THE  NEXT  HIGHEST
MULTIPLE OF ONE HUNDRED DOLLARS.
  S  2. Subparagraph (B) of paragraph 1 of subsection (d) of section 601
of the tax law, as amended by section 1 of part R of chapter 63  of  the
laws of 2003, is amended to read as follows:
  (B)  The fraction is computed as follows: (I) FOR TAXABLE YEARS BEGIN-
NING ON OR BEFORE JANUARY FIRST, TWO THOUSAND TEN, the numerator is  the
lesser  of  fifty  thousand  dollars  or the excess of New York adjusted

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD10973-03-1

S. 5016--A                          2

gross income for the taxable year over one hundred thousand dollars  and
the denominator is fifty thousand dollars.
  (II) IN THE CASE OF ANY TAXABLE YEAR BEGINNING AFTER TWO THOUSAND TEN,
THE  NUMERATOR  IS THE LESSER OF THE DIFFERENCE BETWEEN THE UPPER INCOME
THRESHOLD AND THE LOWER INCOME THRESHOLD  OR  THE  EXCESS  OF  NEW  YORK
ADJUSTED GROSS INCOME FOR THE TAXABLE YEAR OVER THE LOWER INCOME THRESH-
OLD.  THE  DENOMINATOR  SHALL BE THE DIFFERENCE BETWEEN THE UPPER INCOME
THRESHOLD AND THE LOWER INCOME THRESHOLD.
  (III) FOR THE PURPOSES OF THIS SUBPARAGRAPH, THE LOWER INCOME  THRESH-
OLD SHALL BE THE PRODUCT OF ONE HUNDRED THOUSAND DOLLARS AND THE COST OF
LIVING ADJUSTMENT AND THE UPPER INCOME THRESHOLD SHALL BE THE PRODUCT OF
ONE HUNDRED FIFTY THOUSAND DOLLARS AND THE COST OF LIVING ADJUSTMENT.
  (IV) FOR THE PURPOSES OF THIS SUBPARAGRAPH, THE COST OF LIVING ADJUST-
MENT  FOR ANY TAXABLE YEAR SHALL BE THE PERCENTAGE (IF ANY) BY WHICH THE
CPI FOR THE PRECEDING CALENDAR YEAR EXCEEDS THE CPI  FOR  CALENDAR  YEAR
TWO  THOUSAND  NINE.  THE  CPI IS DEFINED AS THE AVERAGE OF THE CONSUMER
PRICE INDEX FOR ALL URBAN  CONSUMERS  PUBLISHED  BY  THE  UNITED  STATES
DEPARTMENT  OF  LABOR  AS OF THE CLOSE OF THE TWELVE MONTH PERIOD ENDING
AUGUST THIRTY-FIRST OF SUCH CALENDAR YEAR.
  (V) IF ANY INCREASE DETERMINED UNDER THIS SUBPARAGRAPH IS NOT A MULTI-
PLE OF ONE HUNDRED DOLLARS, SUCH INCREASE SHALL BE ROUNDED TO  THE  NEXT
HIGHEST MULTIPLE OF ONE HUNDRED DOLLARS.
  S  3. Section 614 of the tax law is amended by adding a new subsection
(f) to read as follows:
  (F) COST OF LIVING ADJUSTMENT.   FOR TAXABLE YEARS  BEGINNING  ON  AND
AFTER  JANUARY  FIRST, TWO THOUSAND ELEVEN, EACH DOLLAR AMOUNT CONTAINED
IN SUBSECTIONS (A), (B), (C), (D) AND  (E)  OF  THIS  SECTION  SHALL  BE
INCREASED  FOR  THE COST OF LIVING ADJUSTMENT.  FOR THE PURPOSES OF THIS
SUBSECTION, THE COST OF LIVING ADJUSTMENT FOR ANY TAXABLE YEAR SHALL  BE
THE PERCENTAGE (IF ANY) BY WHICH THE CPI FOR THE PRECEDING CALENDAR YEAR
EXCEEDS  THE CPI FOR CALENDAR YEAR TWO THOUSAND NINE. THE CPI IS DEFINED
AS THE AVERAGE OF THE CONSUMER  PRICE  INDEX  FOR  ALL  URBAN  CONSUMERS
PUBLISHED  BY  THE  UNITED STATES DEPARTMENT OF LABOR AS OF THE CLOSE OF
THE TWELVE MONTH PERIOD ENDING  AUGUST  THIRTY-FIRST  OF  SUCH  CALENDAR
YEAR. IF ANY INCREASE DETERMINED UNDER THIS SUBPARAGRAPH IS NOT A MULTI-
PLE  OF  ONE HUNDRED DOLLARS, SUCH INCREASE SHALL BE ROUNDED TO THE NEXT
HIGHEST MULTIPLE OF ONE HUNDRED DOLLARS.
  S 4. Section 616 of the tax law is amended by adding a new  subsection
(c) to read as follows:
  (C)  COST  OF  LIVING ADJUSTMENT.   FOR TAXABLE YEARS BEGINNING ON AND
AFTER JANUARY FIRST, TWO THOUSAND ELEVEN, EACH DOLLAR  AMOUNT  CONTAINED
IN  SUBSECTION  (A)  OF  THIS SECTION SHALL BE INCREASED FOR THE COST OF
LIVING ADJUSTMENT. FOR THE PURPOSES OF  THIS  SUBSECTION,  THE  COST  OF
LIVING  ADJUSTMENT FOR ANY TAXABLE YEAR SHALL BE THE PERCENTAGE (IF ANY)
BY WHICH THE CPI FOR THE PRECEDING CALENDAR YEAR  EXCEEDS  THE  CPI  FOR
CALENDAR  YEAR  TWO  THOUSAND NINE. THE CPI IS DEFINED AS THE AVERAGE OF
THE CONSUMER PRICE INDEX FOR ALL URBAN CONSUMERS PUBLISHED BY THE UNITED
STATES DEPARTMENT OF LABOR AS OF THE CLOSE OF THE  TWELVE  MONTH  PERIOD
ENDING AUGUST THIRTY-FIRST OF SUCH CALENDAR YEAR. IF ANY INCREASE DETER-
MINED  UNDER THIS SUBPARAGRAPH IS NOT A MULTIPLE OF ONE HUNDRED DOLLARS,
SUCH INCREASE SHALL BE ROUNDED TO  THE  NEXT  HIGHEST  MULTIPLE  OF  ONE
HUNDRED DOLLARS.
  S 5. This act shall take effect immediately and shall apply to taxable
years starting on or after January 1, 2011.

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