NY State Senate Bill 2017-S1406

Senate Bill S1406

2017-2018 Legislative Session

Establishes corporate, business franchise, personal, insurance and banking tax credits for the provision of employee federal qualified transportation fringe benefits

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Archive: Last Bill Status - In Senate Committee Investigations And Government Operations Committee

Introduced
- In Committee Assembly
- In Committee Senate
- On Floor Calendar Assembly
- On Floor Calendar Senate
- Passed Assembly
- Passed Senate
Delivered to Governor
Signed By Governor

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	Assembly Actions - Lowercase Senate Actions - UPPERCASE
Jan 03, 2018	referred to investigations and government operations
Jan 09, 2017	referred to investigations and government operations

co-Sponsors

2017-S1406 (ACTIVE) - Details

Current Committee:: Senate Investigations And Government Operations
Law Section:: Tax Law
Laws Affected:: Add §§43 & 187-t, amd §§210-B, 606 & 1511, Tax L
Versions Introduced in Other Legislative Sessions:: 2013-2014: S6737
2015-2016: S2703
2019-2020: S1144

2017-S1406 (ACTIVE) - Summary

Establishes corporate, business franchise, personal, insurance and banking tax credits for the provision of employee federal qualified transportation fringe benefits.

2017-S1406 (ACTIVE) - Sponsor Memo

                                 BILL NUMBER:  S1406

 TITLE OF BILL :  An act to amend the tax law, in relation to
establishing tax credits for taxpayers which provide their employees
with access to federal qualified transportation fringe benefits

 PURPOSE :

To provide businesses with a tax credit as an inventive to offer their
employees federal qualified transportation benefits.

 SUMMARY OF PROVISIONS :

Section 1 adds a new section 42 to the tax law. This section gives
filers who file under articles nine, nine-A, twenty- two, or
thirty-three of the tax law a credit against such taxes in tax year
2016.  The credit is equal to $50 for each employee who elects to
participate in a qualified fringe transportation benefit program
offered by the employer, as defined by section 132(f) of the Internal
Revenue Code. This credit can be claimed only by an employer who
establishes such a program on the tax year they claimed the credit for
without having offered such a program previously. The maximum credit
any tax payer can claim is $50,000. The maximum amount which can be
claimed for this credit by all filers is $5 million.

Section 2 adds a new sections 187-t of the tax law to establish the

credit explained above in article nine of the tax law.

Section 3 amends section 210-b of the tax law by adding a new
subdivision 49 to establish the credit explained above in article
nine-A of the tax law.

Section 4 amends subparagraph (B) of paragraph 1 of subsection (i) of
section 606 of the tax law by adding a new clause (xli) to establish
the credit explained above.

Section 5 amends section 606 of the tax law by adding a new subsection
(ccc) to add this credit to the list of credits that can be claimed
under this section of law.

Section 6 amends section 1511 of the tax law by adding a new
subdivision (dd) to establish the credit explained above.

Section 7 establishes an immediate effective date.

 JUSTIFICATION :

Every day over 8.9 million New Yorkers commute to work. Commuting
costs can quickly add up and eat up an important chunk of an
individual's annual budget. New York state is unique in the number of
employees who commute using public transportation. According to the
Bureau of Labor, in the 2011-2012 period the average expenditure in
transportation in the New York Metropolitan statistical region was
around $8,000 a year, with the expense on mass transit being an
average of $1,142.

In order to help pay for commuting expenses, federal tax law allows
employers to offer a benefit that sets aside pre-taxable income with
which employees can pay for eligible commuting expenses. Each year the
IRS sets the limit for how much income an employee can set aside to
pay for qualifying transportation expenses. For tax year 2014,
employees can set aside up to $250 a month in income to pay for
qualifying parking expenses related to an individual's parking
expenses at work, and up to $130 a month to pay for transit expenses
like paying for mass transit or commuter van service. An employee may
also receive a $20 a month for qualified bicycling expenses.
The income that is set aside each month is exempt from all taxation,
including payroll taxes and federal, state, and local income taxes.
This means that the employees tax bill is lowered by hundreds of
dollars, with the specific savings determined by how much income is
set aside and the income tax status of the employee. The employer also
saves money, since the salary put side is exempted from the employer
share of payroll taxes. Unfortunately, even though employers can save
money as well, according to the Bureau of Labor survey of employee
benefits only 8% of employees in the Northeast region have access to
this benefit. This declines to only 3% of employers with under 100
employees offer this benefit.

Businesses provide this fringe benefit by working with third party
program administrators who administrate the program. There are some
minor administrative fees that employers pay, as well as paperwork to
be filed in order to begin offering the benefit. While these
administrative costs would be easily recouped in the vast majority of
cases just from the tax benefit the employers get plus ancillary
benefits such as improving employee satisfaction, they can lead to
some employers choosing not to offer these benefits. The tax credit
proposed is meant to give businesses an incentive to establish these
programs and offer them to their employees by more than covering
whatever up-front costs they would have to deal with in establishing
the program. If employers in New York make full use of this credit,
100,000 workers in New York would gain access to this benefit, and see
their commuting costs cut. Those businesses who establish these
Programs would then reap the benefits in following years.

 LEGISLATIVE HISTORY :

2015-16: S2703A - Investigations and Government Operations S.6737 of
2014

 FISCAL IMPLICATIONS :

The credit amount to be offered is capped at $5 million. Since the
benefit allows employees to deduct income set aside for qualified
expenses from taxes, there would be an additional associated costs to
the state in the form of lost income tax revenue. If the program is
fully utilized, we estimate there could be a concurrent loss of $14
million in income tax revenue to the State.

 LEGISLATIVE DATE :

This act shall take effect immediately.

2017-S1406 (ACTIVE) - Bill Text download pdf

                            
 
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   1406
 
                        2017-2018 Regular Sessions
 
                             I N  S E N A T E
 
                              January 9, 2017
                                ___________
 
 Introduced  by  Sens.  CARLUCCI,  AVELLA, KLEIN, SAVINO, VALESKY -- read
   twice and ordered printed, and when printed to  be  committed  to  the
   Committee on Investigations and Government Operations
 
 AN ACT to amend the tax law, in relation to establishing tax credits for
   taxpayers  which provide their employees with access to federal quali-
   fied transportation fringe benefits
 
   THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section  1.  The tax law is amended by adding a new section 43 to read
 as follows:
   § 43. CREDIT FOR PROVISION OF EMPLOYEE FEDERAL  QUALIFIED  TRANSPORTA-
 TION  FRINGE  BENEFITS.  (A)  ALLOWANCE  OF CREDIT. FOR THE TAXABLE YEAR
 COMMENCING ON JANUARY FIRST, TWO THOUSAND SEVENTEEN, A TAXPAYER  SUBJECT
 TO  TAX  UNDER  ARTICLE NINE, NINE-A, TWENTY-TWO OR THIRTY-THREE OF THIS
 CHAPTER SHALL BE ALLOWED A CREDIT AGAINST  SUCH  TAX,  PURSUANT  TO  THE
 PROVISIONS  REFERENCED  IN  SUBDIVISION  (D) OF THIS SECTION. THE CREDIT
 SHALL BE ALLOWED WHERE A TAXPAYER HAS ESTABLISHED AND IMPLEMENTED FEDER-
 AL QUALIFIED TRANSPORTATION FRINGE BENEFITS FOR ITS EMPLOYEES DURING THE
 TAXABLE YEAR IN WHICH SUCH CREDIT IS CLAIMED, AND THE TAXPAYER  HAS  NOT
 PROVIDED  SUCH  BENEFITS TO ITS EMPLOYEES DURING ANY PRIOR TAXABLE YEAR.
 THE CREDIT SHALL BE EQUAL TO FIFTY DOLLARS  FOR  EACH  EMPLOYEE  OF  THE
 TAXPAYER  WHO ELECTED TO PARTICIPATE IN THE TAXPAYER'S FEDERAL QUALIFIED
 TRANSPORTATION FRINGE BENEFITS PROGRAM DURING THE TAXABLE YEAR IN  WHICH
 SUCH  PROGRAM  IS  ESTABLISHED BY THE TAXPAYER. THE AMOUNT OF THE CREDIT
 GRANTED TO ANY TAXPAYER PURSUANT TO THIS SECTION SHALL NOT EXCEED  FIFTY
 THOUSAND DOLLARS.
   (B)  DEFINITION. AS USED IN THIS SECTION, "FEDERAL QUALIFIED TRANSPOR-
 TATION FRINGE BENEFITS" MEANS A QUALIFIED FEDERAL TRANSPORTATION  FRINGE
 BENEFITS PROGRAM ESTABLISHED AND IMPLEMENTED BY A TAXPAYER IN ACCORDANCE
 WITH  SECTION  132(F)  OF  THE INTERNAL REVENUE CODE AND THE REGULATIONS
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
                                                            LBD01955-01-7

 S. 1406                             2
 
 ADOPTED PURSUANT THERETO.  EVERY SUCH PROGRAM SHALL BE ADMINISTERED BY A
 THIRD PARTY PROGRAM ADMINISTRATOR.
   (C)  CROSS  REFERENCES.  FOR APPLICATION OF THE CREDIT PROVIDED FOR IN
 THIS SECTION, SEE THE FOLLOWING PROVISIONS OF THIS CHAPTER:
   (1) ARTICLE 9: SECTION 187-T,
   (2) ARTICLE 9-A: SECTION 210-B, SUBDIVISION 49,
   (3) ARTICLE 22: SECTION 606, SUBSECTIONS (I) AND (CCC),
   (4) ARTICLE 33: SECTION 1511, SUBDIVISION (DD).
   (D) ALLOCATION OF CREDIT. THE AGGREGATE OF TAX CREDITS  ALLOWED  UNDER
 THIS SECTION, SECTION ONE HUNDRED EIGHTY-SEVEN-T, SUBDIVISION FORTY-NINE
 OF  SECTION  TWO  HUNDRED  TEN-B,  CLAUSE (XLIII) OF SUBPARAGRAPH (B) OF
 PARAGRAPH ONE OF SUBSECTION (I) AND  SUBSECTION  (CCC)  OF  SECTION  SIX
 HUNDRED  SIX  AND  SUBDIVISION (DD) OF SECTION FIFTEEN HUNDRED ELEVEN OF
 THIS CHAPTER SHALL NOT EXCEED FIVE MILLION DOLLARS.
   § 2. The tax law is amended by adding a new section 187-t to  read  as
 follows:
   §  187-T. CREDIT FOR PROVISION OF EMPLOYEE FEDERAL QUALIFIED TRANSPOR-
 TATION FRINGE BENEFITS. 1. ALLOWANCE OF  CREDIT.  A  TAXPAYER  SHALL  BE
 ALLOWED  A  CREDIT, TO BE COMPUTED AS PROVIDED IN SECTION FORTY-THREE OF
 THIS CHAPTER, AGAINST THE TAXES IMPOSED BY SECTIONS ONE HUNDRED  EIGHTY-
 THREE, ONE HUNDRED EIGHTY-FOUR AND ONE HUNDRED EIGHTY-FIVE OF THIS ARTI-
 CLE.    PROVIDED,  HOWEVER,  THAT  THE  AMOUNT  OF SUCH CREDIT ALLOWABLE
 AGAINST THE TAX IMPOSED BY SECTION ONE HUNDRED EIGHTY-FOUR OF THIS ARTI-
 CLE SHALL BE THE EXCESS OF THE AMOUNT OF SUCH CREDIT OVER THE AMOUNT  OF
 ANY  CREDIT  ALLOWED  BY THIS SECTION AGAINST THE TAX IMPOSED BY SECTION
 ONE HUNDRED EIGHTY-THREE OF THIS ARTICLE.
   2. APPLICATION OF CREDIT. IN NO EVENT  SHALL  THE  CREDIT  UNDER  THIS
 SECTION  BE  ALLOWED  IN  AN AMOUNT WHICH WILL REDUCE THE TAX PAYABLE TO
 LESS THAN THE APPLICABLE MINIMUM TAX FIXED BY SECTION ONE HUNDRED EIGHT-
 Y-THREE OR ONE HUNDRED EIGHTY-FIVE OF THIS ARTICLE.
   § 3. Section 210-B of the tax law is amended by adding a new  subdivi-
 sion 49 to read as follows:
   49.  CREDIT FOR PROVISION OF EMPLOYEE FEDERAL QUALIFIED TRANSPORTATION
 FRINGE BENEFITS. (A) ALLOWANCE OF CREDIT. A TAXPAYER SHALL BE ALLOWED  A
 CREDIT,  TO BE COMPUTED AS PROVIDED IN SECTION FORTY-THREE OF THIS CHAP-
 TER, AGAINST THE TAX IMPOSED BY THIS ARTICLE.
   (B) APPLICATION OF CREDIT. THE CREDIT ALLOWED UNDER  THIS  SUBDIVISION
 SHALL  NOT  REDUCE  THE  TAX  DUE TO LESS THAN THE HIGHER OF THE AMOUNTS
 PRESCRIBED IN PARAGRAPHS (C) AND (D) OF SUBDIVISION ONE OF THIS SECTION.
   § 4. Subparagraph (B) of paragraph 1 of subsection (i) of section  606
 of  the  tax  law  is  amended by adding a new clause (xliii) to read as
 follows:
 (XLIII) CREDIT FOR PROVISION OF      AMOUNT OF CREDIT UNDER SUBDIVISION
 EMPLOYEE FEDERAL QUALIFIED           FORTY-NINE OF SECTION TWO HUNDRED
 TRANSPORTATION FRINGE BENEFITS       TEN-B, OR SUBDIVISION (DD) OF
 UNDER SUBSECTION (CCC)               SECTION FIFTEEN HUNDRED ELEVEN
   § 5. Section 606 of the tax law is amended by adding a new  subsection
 (ccc) to read as follows:
   (CCC)  CREDIT  FOR PROVISION OF EMPLOYEE FEDERAL QUALIFIED TRANSPORTA-
 TION FRINGE BENEFITS. ALLOWANCE OF CREDIT. A TAXPAYER SHALL BE ALLOWED A
 CREDIT, TO BE COMPUTED AS PROVIDED IN SECTION FORTY-THREE OF THIS  CHAP-
 TER, AGAINST THE TAX IMPOSED BY THIS ARTICLE.
   §  6.  Section 1511 of the tax law is amended by adding a new subdivi-
 sion (dd) to read as follows:
   (DD) CREDIT FOR PROVISION OF EMPLOYEE FEDERAL QUALIFIED TRANSPORTATION
 FRINGE BENEFITS. (1) ALLOWANCE OF CREDIT. A TAXPAYER SHALL BE ALLOWED  A

 S. 1406                             3
 
 CREDIT,  TO BE COMPUTED AS PROVIDED IN SECTION FORTY-THREE OF THIS CHAP-
 TER, AGAINST THE TAXES IMPOSED BY THIS ARTICLE.
   (2)  APPLICATION  OF CREDIT. THE CREDIT ALLOWED UNDER THIS SUBDIVISION
 SHALL NOT REDUCE THE TAX DUE TO LESS THAN THE MINIMUM TAX FIXED BY PARA-
 GRAPH FOUR OF SUBDIVISION (A) OF SECTION FIFTEEN  HUNDRED  TWO  OF  THIS
 ARTICLE  OR  BY SECTION FIFTEEN HUNDRED TWO-A OF THIS ARTICLE, WHICHEVER
 IS APPLICABLE.
   § 7. This act shall take effect immediately.

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Senate Bill S1406

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Sponsored By

David Carlucci

Archive: Last Bill Status - In Senate Committee Investigations And Government Operations Committee

co-Sponsors

Tony Avella

Jeffrey D. Klein

Diane J. Savino

David J. Valesky

2017-S1406 (ACTIVE) - Details

2017-S1406 (ACTIVE) - Summary

2017-S1406 (ACTIVE) - Sponsor Memo

2017-S1406 (ACTIVE) - Bill Text download pdf

Comments