senate Bill S4576A

Provides tax credit for allowable college expenses

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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

  • 11 / Apr / 2013
    • REFERRED TO INVESTIGATIONS AND GOVERNMENT OPERATIONS
  • 08 / Jan / 2014
    • REFERRED TO INVESTIGATIONS AND GOVERNMENT OPERATIONS
  • 07 / Mar / 2014
    • AMEND AND RECOMMIT TO INVESTIGATIONS AND GOVERNMENT OPERATIONS
  • 07 / Mar / 2014
    • PRINT NUMBER 4576A

Summary

Provides tax credit for allowable college expenses.

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Bill Details

Versions:
S4576
S4576A
Legislative Cycle:
2013-2014
Current Committee:
Senate Investigations And Government Operations
Law Section:
Tax Law
Laws Affected:
Amd ยง606, Tax L

Sponsor Memo

BILL NUMBER:S4576A

TITLE OF BILL: An act to amend the tax law, in relation to providing
a tax credit for allowable college expenses

PURPOSE: To establish the "Stay in New York Tax Credit"

SUMMARY OF PROVISIONS:

Section 1. Amends section 606 of the tax law to add a new section (u)
to establish the stay in New York Tax Credit. The amount of the credit
would be equal to 25% of allowable college expenses, capped at $3000.
Additionally, this section establishes the criteria required to
qualify for the credit.

Section 2. Amends the subparagraph (A) of paragraph 2 of subsection
(t) of section 606 of the tax law to define the term allowable college
tuition expenses.

Section 3. Amends paragraph 4 of subsection (t) of section 606 of the
tax law to improve New York's current tax credit.

Section 4.. Amends subsection (t) of section 606 of the tax law to add
a new section 4-a to create an inflation adjustment for the credit.

Section 5. Sets forth the effective date.

JUSTIFICATION: This bill amends the tax law to create the Stay in New
York Tax Credit in order to retain graduates from New York colleges
and universities. The credit would allow college graduates to receive
a credit equal to their college expenses over four years. This credit
would be capped at $3000 per year and would apply to those graduates
who live and work in New York subsequent to graduation and who
complete community service while they are attending college.

Additionally, this bill improves New York's current tax credit by
doubling the amount of qualified college expenses that can be claimed
from $10,000 to $20,000 over five years and would double the amount of
the credit allowed from $400 to $800 during that same time period.
Furthermore, this bill would index the qualified tuition expenses and
the credit to the rate of inflation of the Higher Education Price
Index.

With the cost of higher education increasing and the amount of student
loan debt accumulated prior to graduation growing at an alarming rate,
this bill would ease the burden of repayment by creating a new tax
credit and improving the already existing program in order to offset
the costs of college. Additionally, this bill encourages students to
complete community service while in college and to remain in New York
State upon graduation.

LEGISLATIVE HISTORY: This bill was included as part A of the college
affordability package, S.7449A of 2012

FISCAL IMPLICATIONS: $212 million by 2016.


EFFECTIVE DATE: This act shall take effect immediately and shall
apply to taxable years beginning on or after January 1, 2015;
provided, however, that section one of this act shall apply to years
beginning on or after January 1, 2016.

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

                                 4576--A

                       2013-2014 Regular Sessions

                            I N  S E N A T E

                             April 11, 2013
                               ___________

Introduced  by  Sen. LAVALLE -- read twice and ordered printed, and when
  printed to be committed to the Committee on Investigations and Govern-
  ment Operations -- recommitted to the Committee on Investigations  and
  Government  Operations  in  accordance  with  Senate Rule 6, sec. 8 --
  committee discharged, bill amended, ordered reprinted as  amended  and
  recommitted to said committee

AN  ACT  to amend the tax law, in relation to providing a tax credit for
  allowable college expenses

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

  Section 1. Subsections (yy) and (zz) of section 606 of the tax law, as
relettered  by section 5 of part H of chapter 1 of the laws of 2003, are
relettered subsections (yyy) and (zzz) and a new subsection (u) is added
to read as follows:
  (U) STAY IN NEW YORK CREDIT. (1)  GENERAL.  (A)  A  RESIDENT  TAXPAYER
SHALL  BE  ALLOWED  A CREDIT AGAINST THE TAX IMPOSED BY THIS ARTICLE FOR
ALLOWABLE COLLEGE EXPENSES. THE AMOUNT OF THE CREDIT SHALL BE  EQUAL  TO
TWENTY-FIVE PERCENT OF ALLOWABLE COLLEGE EXPENSES, CAPPED AT THREE THOU-
SAND DOLLARS. THE CREDIT SHALL BE ALLOWED ONLY IN THE FIRST TAXABLE YEAR
SUBSEQUENT  TO THE TAXPAYER'S COMPLETION OF A COURSE OF STUDY LEADING TO
THE GRANTING OF A BACCALAUREATE DEGREE AND IN EACH  OF  THE  NEXT  THREE
TAXABLE YEARS.
  (B) IN ORDER TO QUALIFY FOR THE CREDIT, THE ELIGIBLE TAXPAYER SHALL:
  (I)  HAVE  COMPLETED  THE COURSE OF STUDY LEADING TO THE GRANTING OF A
BACCALAUREATE DEGREE FROM AN INSTITUTION OF HIGHER EDUCATION WITHIN FOUR
YEARS FROM THE COMMENCEMENT OF SUCH COURSE OF STUDY. PROVIDED,  HOWEVER,
IF  THE  ELIGIBLE TAXPAYER WAS EMPLOYED IN EXCESS OF THREE HUNDRED HOURS
PER SEMESTER, THE ELIGIBLE TAXPAYER SHALL HAVE COMPLETED THE  COURSE  OF
STUDY  LEADING  TO  THE  GRANTING  OF A BACCALAUREATE DEGREE WITHIN FIVE
YEARS FROM THE COMMENCEMENT OF SUCH COURSE OF STUDY;
  (II) BE EMPLOYED FULL-TIME WITHIN THE STATE; AND

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD09565-02-4

S. 4576--A                          2

  (III) HAVE COMPLETED TWENTY HOURS OF COMMUNITY SERVICE PER SEMESTER OF
ENROLLMENT IN AN INSTITUTION OF HIGHER EDUCATION. PROVIDED, HOWEVER, FOR
THOSE ELIGIBLE TAXPAYERS WHO HAVE  BEEN  GRANTED  DEGREES  WITHIN  THREE
YEARS  OF  THE  EFFECTIVE  DATE OF THIS SUBSECTION, SUCH TAXPAYERS SHALL
COMPLETE  THE  COMMUNITY  SERVICE WITHIN THE FIRST TAXABLE YEAR IN WHICH
THE CREDIT IS CLAIMED.
  (C) FOR ELIGIBLE TAXPAYERS WHO ENROLL IN A COURSE OF STUDY LEADING  TO
THE GRANTING OF A POST BACCALAUREATE OR OTHER GRADUATE DEGREE IMMEDIATE-
LY  FOLLOWING THE RECEIPT OF A BACCALAUREATE DEGREE, THE CREDIT SHALL BE
ALLOWED  IN  THE  FIRST  TAXABLE  YEAR  SUBSEQUENT  TO  THE   TAXPAYER'S
COMPLETION OF SUCH DEGREE OR WHEN SUCH TAXPAYER CEASES TO BE ENROLLED IN
SUCH  COURSE  OF  STUDY  AND  IN  EACH  OF  THE NEXT THREE TAXABLE YEARS
PROVIDED ALL OTHER QUALIFICATIONS OF THIS SUBSECTION ARE MET.
  (2) ALLOWABLE AND QUALIFIED COLLEGE EXPENSES. FOR THE PURPOSES OF THIS
CREDIT:
  (A) THE TERM "ALLOWABLE COLLEGE EXPENSES" SHALL MEAN THE TOTAL  AMOUNT
OF  QUALIFIED  COLLEGE  EXPENSES  INCURRED  BY  THE  TAXPAYER DURING THE
TAXPAYER'S ENROLLMENT IN A COURSE OF STUDY LEADING TO THE GRANTING OF  A
BACCALAUREATE DEGREE FROM AN INSTITUTION OF HIGHER EDUCATION.
  (B)  THE  TERM  "QUALIFIED  COLLEGE  EXPENSES"  SHALL MEAN THE TUITION
REQUIRED FOR THE ENROLLMENT OR ATTENDANCE OF THE TAXPAYER AT AN INSTITU-
TION OF HIGHER EDUCATION.   PROVIDED,  HOWEVER,  TUITION  PAYMENTS  MADE
PURSUANT  TO  THE  RECEIPT OF ANY SCHOLARSHIPS OR FINANCIAL AID SHALL BE
EXCLUDED FROM THE DEFINITION OF "QUALIFIED COLLEGE EXPENSES".
  (3) INSTITUTION OF HIGHER EDUCATION. FOR THE PURPOSES OF THIS  CREDIT,
THE TERM "INSTITUTION OF HIGHER EDUCATION" SHALL MEAN ANY INSTITUTION OF
HIGHER  EDUCATION  LOCATED  IN THE STATE, RECOGNIZED AND APPROVED BY THE
REGENTS, OR ANY SUCCESSOR ORGANIZATION, OF THE UNIVERSITY OF  THE  STATE
OF  NEW YORK OR ACCREDITED BY A NATIONALLY RECOGNIZED ACCREDITING AGENCY
OR ASSOCIATION ACCEPTED AS SUCH BY THE REGENTS, OR ANY SUCCESSOR  ORGAN-
IZATION,  OF  THE  UNIVERSITY OF THE STATE OF NEW YORK, WHICH PROVIDES A
COURSE OF STUDY LEADING TO THE  GRANTING  OF  A  POST-SECONDARY  DEGREE,
CERTIFICATE OR DIPLOMA.
  (4)  REFUNDABILITY.  THE CREDIT UNDER THIS SUBSECTION SHALL BE ALLOWED
AGAINST THE TAXES IMPOSED BY THIS ARTICLE FOR THE TAXABLE  YEAR  REDUCED
BY  THE CREDITS PERMITTED BY THIS ARTICLE. IF THE CREDIT EXCEEDS THE TAX
AS SO REDUCED, THE TAXPAYER MAY RECEIVE, AND THE COMPTROLLER, SUBJECT TO
A CERTIFICATE OF THE COMMISSIONER, SHALL PAY AS AN OVERPAYMENT,  WITHOUT
INTEREST, THE AMOUNT OF SUCH EXCESS.
  S  2. Subparagraph (A) of paragraph 2 of subsection (t) of section 606
of the tax law, as amended by section 1 of part N of chapter 85  of  the
laws of 2002, is amended to read as follows:
  (A)  The  term  "allowable  college  tuition  expenses" shall mean the
amount of qualified college tuition expenses of eligible  students  paid
by  the  taxpayer  during  the  taxable year[,]. THE AMOUNT OF QUALIFIED
COLLEGE TUITION EXPENSES SHALL BE limited [to] AS FOLLOWS:  FOR  TAXABLE
YEARS  BEGINNING AFTER TWO THOUSAND AND BEFORE TWO THOUSAND FIFTEEN, ten
thousand dollars for each such student; FOR TAXABLE YEARS  BEGINNING  IN
TWO  THOUSAND  FIFTEEN,  TWELVE  THOUSAND  DOLLARS FOR EACH STUDENT; FOR
TAXABLE YEARS BEGINNING  IN  TWO  THOUSAND  SIXTEEN,  FOURTEEN  THOUSAND
DOLLARS  FOR  EACH  STUDENT; FOR TAXABLE YEARS BEGINNING IN TWO THOUSAND
SEVENTEEN, SIXTEEN THOUSAND DOLLARS FOR EACH STUDENT; FOR TAXABLE  YEARS
BEGINNING  IN  TWO THOUSAND EIGHTEEN, EIGHTEEN THOUSAND DOLLARS FOR EACH
STUDENT; AND FOR TAXABLE YEARS BEGINNING AFTER  TWO  THOUSAND  EIGHTEEN,
TWENTY THOUSAND DOLLARS PER STUDENT;

S. 4576--A                          3

  S  3.  Paragraph 4 of subsection (t) of section 606 of the tax law, as
added by section 1 of part DD of chapter 63 of  the  laws  of  2000,  is
amended to read as follows:
  (4)  Amount of credit. [If allowable college tuition expenses are less
than five thousand dollars, the amount of the credit provided under this
subsection shall be equal to the applicable percentage of the lesser  of
allowable  college tuition expenses or two hundred dollars. If allowable
college tuition expenses are five thousand dollars or more,  the  amount
of  the  credit  provided  under  this  subsection shall be equal to the
applicable percentage of the allowable college tuition  expenses  multi-
plied by four percent.]
  THE  AMOUNT  OF  THE CREDIT SHALL BE DETERMINED IN ACCORDANCE WITH THE
FOLLOWING SCHEDULES:
  (A) FOR TAXABLE YEARS BEGINNING AFTER  TWO  THOUSAND  AND  BEFORE  TWO
THOUSAND FIFTEEN:
IF ALLOWABLE COLLEGE TUITION        THE TAX CREDIT IS EQUAL TO:
EXPENSES ARE:
LESS THAN FIVE THOUSAND DOLLARS     THE APPLICABLE PERCENTAGE OF THE
                                    LESSER OF ALLOWABLE COLLEGE TUITION
                                    EXPENSES OR TWO HUNDRED DOLLARS
FIVE THOUSAND DOLLARS OR MORE       THE APPLICABLE PERCENTAGE OF
                                    ALLOWABLE COLLEGE TUITION EXPENSES
                                    MULTIPLIED BY FOUR PERCENT
  (B) FOR TAXABLE YEARS BEGINNING IN TWO THOUSAND FIFTEEN:
IF ALLOWABLE COLLEGE TUITION        THE TAX CREDIT IS EQUAL TO:
EXPENSES ARE:
LESS THAN SIX THOUSAND DOLLARS      THE LESSER OF ALLOWABLE COLLEGE
                                    TUITION EXPENSES OR TWO HUNDRED
                                    FORTY DOLLARS
SIX THOUSAND DOLLARS OR MORE        THE ALLOWABLE COLLEGE TUITION
                                    EXPENSES MULTIPLIED BY FOUR PERCENT
  (C) FOR TAXABLE YEARS BEGINNING IN TWO THOUSAND SIXTEEN:
IF ALLOWABLE COLLEGE TUITION        THE TAX CREDIT IS EQUAL TO:
EXPENSES ARE:
LESS THAN SEVEN THOUSAND DOLLARS    THE LESSER OF ALLOWABLE COLLEGE
                                    TUITION EXPENSES OR TWO HUNDRED
                                    EIGHTY DOLLARS
SEVEN THOUSAND DOLLARS OR MORE      THE ALLOWABLE COLLEGE TUITION
                                    EXPENSES MULTIPLIED BY FOUR PERCENT
  (D) FOR TAXABLE YEARS BEGINNING IN TWO THOUSAND SEVENTEEN:
IF ALLOWABLE COLLEGE TUITION        THE TAX CREDIT IS EQUAL TO:
EXPENSES ARE:
LESS THAN EIGHT THOUSAND DOLLARS    THE LESSER OF ALLOWABLE COLLEGE
                                    TUITION EXPENSES OR THREE HUNDRED
                                    TWENTY DOLLARS
EIGHT THOUSAND DOLLARS OR MORE      THE ALLOWABLE COLLEGE TUITION
                                    EXPENSES MULTIPLIED BY FOUR PERCENT
  (E) FOR TAXABLE YEARS BEGINNING IN TWO THOUSAND EIGHTEEN:
IF ALLOWABLE COLLEGE TUITION        THE TAX CREDIT IS EQUAL TO:
EXPENSES ARE:
LESS THAN NINE THOUSAND DOLLARS     THE LESSER OF ALLOWABLE COLLEGE
                                    TUITION EXPENSES OR THREE HUNDRED
                                    SIXTY DOLLARS
NINE THOUSAND DOLLARS OR MORE       THE ALLOWABLE COLLEGE TUITION
                                    EXPENSES MULTIPLIED BY FOUR PERCENT
  (F) FOR TAXABLE YEARS BEGINNING AFTER TWO THOUSAND EIGHTEEN:

S. 4576--A                          4

IF ALLOWABLE COLLEGE TUITION        THE TAX CREDIT IS EQUAL TO:
EXPENSES ARE:
LESS THAN TEN THOUSAND DOLLARS      THE LESSER OF ALLOWABLE COLLEGE
                                    TUITION EXPENSES OR FOUR HUNDRED
                                    DOLLARS
TEN THOUSAND DOLLARS OR MORE        THE ALLOWABLE COLLEGE TUITION
                                    EXPENSES MULTIPLIED BY FOUR PERCENT
  Such  applicable  percentage  shall be twenty-five percent for taxable
years beginning in two thousand one, fifty  percent  for  taxable  years
beginning  in  two  thousand two, seventy-five percent for taxable years
beginning in two thousand three and  one  hundred  percent  for  taxable
years beginning after two thousand three.
  S 4. Subsection (t) of section 606 of the tax law is amended by adding
a new paragraph 4-a to read as follows:
  (4-A)  INFLATION  ADJUSTMENT.  (A)  FOR  TAXABLE YEARS BEGINNING IN OR
AFTER TWO THOUSAND NINETEEN, THE DOLLAR AMOUNTS IN SUBPARAGRAPH  (A)  OF
PARAGRAPH  TWO AND PARAGRAPH FOUR OF THIS SUBSECTION SHALL BE MULTIPLIED
BY ONE PLUS THE INFLATION ADJUSTMENT.
  (B) THE INFLATION  ADJUSTMENT  FOR  ANY  TAXABLE  YEAR  SHALL  BE  THE
PERCENTAGE,  IF  ANY,  BY WHICH THE HIGHER EDUCATION PRICE INDEX FOR THE
ACADEMIC FISCAL YEAR ENDING IN THE IMMEDIATELY  PRECEDING  TAXABLE  YEAR
EXCEEDS  THE  HIGHER  EDUCATION PRICE INDEX FOR THE ACADEMIC FISCAL YEAR
ENDING JUNE, TWO THOUSAND EIGHTEEN. FOR THE PURPOSES OF THIS  PARAGRAPH,
THE  HIGHER EDUCATION PRICE INDEX MEANS THE HIGHER EDUCATION PRICE INDEX
PUBLISHED BY THE COMMONFUND INSTITUTE.
  (C) IF THE PRODUCT OF THE AMOUNTS IN SUBPARAGRAPHS (A) AND (B) OF THIS
PARAGRAPH IS NOT A MULTIPLE OF FIVE  DOLLARS,  SUCH  INCREASE  SHALL  BE
ROUNDED TO THE NEXT MULTIPLE OF FIVE DOLLARS.
  S 5. This act shall take effect immediately and shall apply to taxable
years  beginning  on  or  after January 1, 2015; provided, however, that
section one of this act shall apply to taxable  years  beginning  on  or
after January 1, 2016.

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