NY State Senate Bill S4239A

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

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

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Actions

view actions (4)

	Assembly Actions - Lowercase Senate Actions - UPPERCASE
Jan 06, 2010	referred to investigations and government operations
Jun 01, 2009	print number 4239a
Jun 01, 2009	amend (t) and recommit to investigations and government operations
Apr 20, 2009	referred to investigations and government operations

Bill Amendments

Original

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Original

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Co-Sponsors

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S4239 - Details

See Assembly Version of this Bill:: A8702
Current Committee:: Senate Investigations And Government Operations
Law Section:: Tax Law
Laws Affected:: Amd §606, Tax L
Versions Introduced in Other Legislative Sessions:: 2011-2012: S912, A5542
2013-2014: S3266, A5834
2015-2016: S3110, A6458
2017-2018: S4579, A6270
2019-2020: S3982, A5750
2021-2022: S1434

S4239 - Summary

Creates the middle class circuit breaker tax credit and a tax reform study commission.

S4239 - Sponsor Memo

 BILL NUMBER:  S4239

 TITLE OF BILL :
An act to amend the tax law, in relation to creating the middle class
circuit breaker tax credit


 PURPOSE OR GENERAL IDEA OF BILL :
To provide a personal income tax credit for certain property taxpayers
who pay a disproportionate share of their income to property taxes.

 SUMMARY OF SPECIFIC PROVISIONS :
SECTION 1: Adds a new subsection (qq) to section 606 of the tax law to
provide for a real property tax credit. The credit will be based on
the income of the household and the percentage that said household
pays for real property taxes.

For Homeowners

For taxable years starting in 2009:
Household Adjusted Gross Income
Tax Maximum Real Property Tax       Maximum Real Property Tax

$100,000 or less                    Real Property taxes paid in
                                    excess of 9% of said income
                                    can receive a personal income

                                    tax credit of 70% of the overage.

$100,001+                           No credit.

No credit.

For taxable years starting in 2010:
Household Adjusted Gross
Income Tax                          Maximum Real Property Tax

$100,000 or less                    Real Property taxes paid in
                                    excess of 8.5% of said income
                                    can receive a personal income
                                    tax credit of 70%
                                    of the overage.

$100,001 +                          No credit.

For taxable years starting in 2011:
Household Adjusted Gross
Income Tax                          Maximum Real Property Tax

$100,000 or less                    Real Property taxes paid in
                                    excess of 7.5% of said income
                                    can receive a personal income
                                    tax credit of 70% of the
                                    overage.

$100,001 - $150,000                 Real Property taxes paid in
                                    excess of 7.5% of the first
                                    $100,000 of said income can
                                    PLUS 8.5% of said income above
                                    $100,000 can receive a personal
                                    income tax credit of 70% of the
                                    overage.

$150,001 +                          No credit.


For taxable years starting in 2012:
Household Adjusted Gross
Income Tax                          Maximum Real Property Tax

$100,000 or less                    Real Property taxes paid in
                                    excess of 6% of said income
                                    can receive a personal income
                                    tax credit of 70% of the overage.

$100,001 - $150,000                 Real Property taxes paid in excess
                                    of 6% of the first $100,000 of
                                    of said income PLUS 7% of said
                                    above $100,000 can receive a
                                    income tax credit of 70% of
                                    the overage.

$150,001 - $250,000                 Real Property taxes paid in
                                    excess of 6% of the first
                                    $100,000 of said income PLUS
                                    7% of the next $50,000 of said
                                    income PLUS 8.5% of said income
                                    above $150,000 can receive a
                                    personal income tax credit of
                                    70% of the overage.

$250,000 +                          No credit.


To  qualify,  the  taxpayer must have resided in the home for not less
than five years. Also, the taxpayer may still benefit from  the  Basic
STAR  exemption  or  the  Enhanced STAR exemption for senior citizens.
The credit will equal seventy percent  of  the  taxes  paid  over  the
allowed percentage cap as provided in the bill.

The act would also provide for a "real property tax equivalent" in the
case  of  taxpayers  who  rent real property as their primary New York
State residence.

For taxable years starting in 2010 the "real property tax  equivalent"
equal  to  15% of the adjusted rent actually paid in the taxable year.
taxable years starting in 2011, the amount is increased to 20% of  the
adjusted rent actually paid in the taxable year.

will be For

SECTION 2: Contains the effective date.

 JUSTIFICATION :
The  middle  class  property  tax circuit breaker program is a concept
that has successfully been used in several states  to  provide  relief
from  a residential homeowner's property tax when it exceeds a certain
portion of their household income. It has been traditionally used  for
homeowners  with  very low incomes and low assessments. New York State
currently has  a  circuit  breaker  provision  that  has  existed  for
decades,  but the maximum eligible household income is $18,000 and the
maximum eligible home value is $85,000. This new program would  target
middle-class   New   Yorkers   who   have   financially   suffered  as
municipalities have had to rely more heavily on  real  property  taxes
for  local  government revenue. Many homeowners are facing sky-rocking
real property tax bills as a result they  are  often  faced  with  the
serious  threat of defaulting on their property taxes and/or seriously
consider selling their homes.

Critics of the New  York's  STAR  program  have  claimed  that  it  is
inequitable because it does not draw a connection between a taxpayer's
household income and the amount of his tax bill. The Middle Class STAR
Rebate Checks program, which began in 1970 and was eliminated in 2009,
compounded  this  effect  because  it  calculated a household's rebate
amount as a percentage of  the  value  of  its  STAR  exemption.  This
legislation seeks to resolve these limitations and remain sensitive to
the  State's  current financial crisis.   Additionally, the bill would
add progressivity to property tax relief and extend  the  benefits  to
property  renters  who  are  often burdened with property taxes in the
cost of their rent. The bill is phased in over four years in order  to
take  the  state's  fiscal situation into consideration while ensuring
that  the  most  overburdened  property  taxpayers  -  based  on   the
percentage  of  income they are paying in property tax on their home -
will get relief quickly.

 PRIOR LEGISLATIVE HISTORY :
None.

 FISCAL IMPLICATIONS :
The program is phased in over four  years  and  will  cost  the  State
nothing in the first year. For year two the cost will be $1.1 billion;
year  three  will  cost $1.4 billion; year four will cost $1.8 billion
and every year after will cost $2.3 billion.

 EFFECTIVE DATE :
Immediately after enactment.

S4239 - Bill Text download pdf

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

                                  4239

                       2009-2010 Regular Sessions

                            I N  S E N A T E

                             April 20, 2009
                               ___________

Introduced  by  Sens.  KRUEGER,  DIAZ, ONORATO, SAMPSON, SCHNEIDERMAN --
  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 creating the middle class
  circuit breaker tax credit

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

  Section  1.  Section  606  of  the  tax law is amended by adding a new
subsection (qq) to read as follows:
  (QQ) MIDDLE CLASS CIRCUIT BREAKER CREDIT.  (1)  DEFINITIONS.  FOR  THE
PURPOSES OF THIS SUBSECTION:
  (A)  "QUALIFIED TAXPAYER" MEANS A RESIDENT INDIVIDUAL OF THE STATE WHO
OWNS OR RENTS THE RESIDENTIAL REAL PROPERTY IN WHICH HE OR SHE  RESIDES,
AND HAS RESIDED IN SUCH RESIDENTIAL REAL PROPERTY FOR NOT LESS THAN FIVE
YEARS.
  (B)  "HOUSEHOLD"  OR  "MEMBERS  OF  THE  HOUSEHOLD"  MEANS A QUALIFIED
TAXPAYER OR QUALIFIED TAXPAYERS AND ALL OTHER PERSONS,  NOT  NECESSARILY
RELATED,  WHO  ALL  RESIDE IN THE RESIDENTIAL REAL PROPERTY OWNED BY THE
TAXPAYER OR TAXPAYERS, AND SHARE ITS FURNISHINGS, FACILITIES AND  ACCOM-
MODATIONS;  PROVIDED  THAT  NO  PERSON  MAY BE A MEMBER OF MORE THAN ONE
HOUSEHOLD AT ONE TIME.
  (C) "HOUSEHOLD GROSS INCOME" MEANS THE AGGREGATE ADJUSTED GROSS INCOME
OF ALL MEMBERS OF THE HOUSEHOLD FOR THE TAXABLE  YEAR  AS  REPORTED  FOR
FEDERAL  INCOME  TAX  PURPOSES,  OR  WHICH WOULD BE REPORTED AS ADJUSTED
GROSS INCOME IF A FEDERAL INCOME TAX RETURN WERE REQUIRED TO  BE  FILED,
WITH  THE  MODIFICATIONS IN SUBSECTION (B) OF SECTION SIX HUNDRED TWELVE
OF THIS ARTICLE BUT WITHOUT THE MODIFICATIONS IN SUBSECTION (C) OF  SUCH
SECTION, PLUS ANY PORTION OF THE GAIN FROM THE SALE OR EXCHANGE OF PROP-
ERTY  OTHERWISE  EXCLUDED  FROM  SUCH AMOUNT; EARNED INCOME FROM SOURCES
WITHOUT THE UNITED  STATES  EXCLUDABLE  FROM  FEDERAL  GROSS  INCOME  BY
SECTION  NINE HUNDRED ELEVEN OF THE INTERNAL REVENUE CODE; SUPPORT MONEY

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD10999-01-9

S. 4239                             2

NOT INCLUDED IN  ADJUSTED  GROSS  INCOME;  NONTAXABLE  STRIKE  BENEFITS;
SUPPLEMENTAL  SECURITY  INCOME PAYMENTS; THE GROSS AMOUNT OF ANY PENSION
OR ANNUITY BENEFITS TO THE EXTENT NOT INCLUDED IN  SUCH  ADJUSTED  GROSS
INCOME  (INCLUDING, BUT NOT LIMITED TO, RAILROAD RETIREMENT BENEFITS AND
ALL PAYMENTS RECEIVED UNDER THE FEDERAL SOCIAL SECURITY ACT  AND  VETER-
ANS'  DISABILITY  PENSIONS); NONTAXABLE INTEREST RECEIVED FROM THE STATE
OF NEW YORK, ITS AGENCIES, INSTRUMENTALITIES,  PUBLIC  CORPORATIONS,  OR
POLITICAL  SUBDIVISIONS (INCLUDING A PUBLIC CORPORATION CREATED PURSUANT
TO AGREEMENT OR COMPACT WITH ANOTHER STATE OR CANADA); WORKERS'  COMPEN-
SATION;  THE GROSS AMOUNT OF "LOSS-OF-TIME" INSURANCE; AND THE AMOUNT OF
CASH PUBLIC ASSISTANCE AND RELIEF, OTHER THAN MEDICAL ASSISTANCE FOR THE
NEEDY, PAID TO OR FOR THE BENEFIT OF THE QUALIFIED TAXPAYER  OR  MEMBERS
OF  HIS  OR  HER  HOUSEHOLD.  HOUSEHOLD GROSS INCOME SHALL   NOT INCLUDE
SURPLUS FOODS OR OTHER RELIEF IN KIND OR PAYMENTS  MADE  TO  INDIVIDUALS
BECAUSE  OF  THEIR  STATUS  AS VICTIMS OF NAZI PERSECUTION AS DEFINED IN
PUBLIC LAW 103-286 OR ANY DISABILITY COMPENSATION RECEIVED  BY  VETERANS
ON  ACCOUNT  OF INJURY OR ILLNESS INCURRED OR AGGRAVATED DURING MILITARY
SERVICE IN THE WARS IN AFGHANISTAN AND IRAQ  SINCE  SEPTEMBER  ELEVENTH,
TWO  THOUSAND ONE.  PROVIDED, FURTHER, HOUSEHOLD GROSS INCOME SHALL ONLY
INCLUDE ALL SUCH INCOME RECEIVED BY ALL MEMBERS OF THE  HOUSEHOLD  WHILE
MEMBERS OF SUCH HOUSEHOLD.
  (D)  "ADJUSTED  RENT"  MEANS RENT PAID FOR THE RIGHT OF OCCUPANCY OF A
RESIDENCE.
  (E) "REAL PROPERTY TAX EQUIVALENT" MEANS (1) FOR TAXABLE YEARS  BEGIN-
NING  IN TWO THOUSAND TEN, FIFTEEN PERCENT OF THE ADJUSTED RENT ACTUALLY
PAID IN THE TAXABLE YEAR BY A HOUSEHOLD SOLELY FOR THE RIGHT OF OCCUPAN-
CY OF ITS NEW YORK RESIDENCE FOR THE TAXABLE YEAR. IF (I) A RESIDENCE IS
RENTED TO TWO OR MORE INDIVIDUALS  AS  COTENANTS,  OR  SUCH  INDIVIDUALS
SHARE IN THE PAYMENT OF A SINGLE RENT FOR THE RIGHT OF OCCUPANCY OF SUCH
RESIDENCE,  AND (II) EACH OF SUCH INDIVIDUALS  IS A MEMBER OF  A DIFFER-
ENT HOUSEHOLD, ONE OR MORE OF WHICH INDIVIDUALS SHARES  SUCH  RESIDENCE,
REAL  PROPERTY  TAX EQUIVALENT IS THAT PORTION OF FIFTEEN PERCENT OF THE
ADJUSTED RENT PAID IN THE TAXABLE YEAR WHICH REFLECTS  THAT  PORTION  OF
THE  RENT  ATTRIBUTABLE TO THE QUALIFIED TAXPAYER AND THE MEMBERS OF HIS
OR HER HOUSEHOLD; AND (2) FOR TAXABLE YEARS BEGINNING  IN  TWO  THOUSAND
ELEVEN AND THEREAFTER, TWENTY PERCENT OF THE ADJUSTED RENT ACTUALLY PAID
IN THE TAXABLE YEAR  BY A HOUSEHOLD SOLELY FOR THE RIGHT OF OCCUPANCY OF
ITS NEW YORK RESIDENCE FOR THE TAXABLE YEAR. IF (I) A RESIDENCE IS RENT-
ED TO TWO OR MORE INDIVIDUALS AS COTENANTS, OR SUCH INDIVIDUALS SHARE IN
THE  PAYMENT  OF  A SINGLE RENT FOR THE RIGHT OF OCCUPANCY OF SUCH RESI-
DENCE, AND (II) EACH OF SUCH INDIVIDUALS IS  A  MEMBER  OF  A  DIFFERENT
HOUSEHOLD,  ONE OR MORE OF WHICH INDIVIDUALS SHARES SUCH RESIDENCE, REAL
PROPERTY TAX EQUIVALENT  IS  THAT  PORTION  OF  TWENTY  PERCENT  OF  THE
ADJUSTED  RENT  PAID  IN THE TAXABLE YEAR WHICH REFLECTS THAT PORTION OF
THE RENT ATTRIBUTABLE TO THE QUALIFIED TAXPAYER AND THE MEMBERS  OF  HIS
OR HER HOUSEHOLD.
  (F)  "NET REAL PROPERTY TAX" MEANS THE REAL PROPERTY TAXES ASSESSED ON
THE RESIDENTIAL REAL PROPERTY OWNED AND  OCCUPIED  BY  THE  TAXPAYER  OR
TAXPAYERS AFTER ANY EXEMPTION OR ABATEMENT RECEIVED PURSUANT TO THE REAL
PROPERTY TAX LAW.
  (2) CREDIT. A QUALIFIED TAXPAYER SHALL BE ALLOWED A CREDIT AGAINST THE
TAXES IMPOSED BY THIS ARTICLE, EQUAL TO SEVENTY PERCENT OF THE AMOUNT BY
WHICH  THE TAXPAYER'S NET REAL PROPERTY TAX OR THE TAXPAYER'S REAL PROP-
ERTY TAX EQUIVALENT EXCEEDS THE TAXPAYER'S MAXIMUM REAL PROPERTY TAX, AS
DETERMINED BY PARAGRAPH THREE OF THIS SUBSECTION. IF SUCH CREDIT EXCEEDS
THE TAX FOR SUCH TAXABLE YEAR, AS REDUCED BY THE OTHER CREDITS PERMITTED

S. 4239                             3

BY THIS ARTICLE, THE QUALIFIED  TAXPAYER  MAY  RECEIVE,  AND  THE  COMP-
TROLLER,  SUBJECT  TO  A  CERTIFICATE OF THE DEPARTMENT, SHALL PAY AS AN
OVERPAYMENT, WITHOUT INTEREST, ANY EXCESS BETWEEN SUCH TAX AS SO REDUCED
AND THE AMOUNT OF THE CREDIT. IF A QUALIFIED TAXPAYER IS NOT REQUIRED TO
FILE A RETURN PURSUANT TO SECTION SIX HUNDRED FIFTY-ONE OF THIS ARTICLE,
A  QUALIFIED  TAXPAYER  MAY  NEVERTHELESS  RECEIVE  AND THE COMPTROLLER,
SUBJECT TO A CERTIFICATE OF THE DEPARTMENT, SHALL PAY AS AN  OVERPAYMENT
THE FULL AMOUNT OF THE CREDIT, WITHOUT INTEREST.
  (3) MAXIMUM REAL PROPERTY TAX. (A) A QUALIFIED TAXPAYER'S MAXIMUM REAL
PROPERTY TAX SHALL BE DETERMINED AS FOLLOWS:
  (I) FOR TAX YEARS BEGINNING IN TWO THOUSAND NINE:
HOUSEHOLD GROSS INCOME               MAXIMUM REAL PROPERTY TAX
ONE HUNDRED THOUSAND                 NINE PERCENT OF THE
DOLLARS OR LESS                      HOUSEHOLD GROSS INCOME
MORE THAN ONE HUNDRED                NO LIMITATION.
THOUSAND DOLLARS

  (II) FOR TAX YEARS BEGINNING IN TWO THOUSAND TEN:
HOUSEHOLD GROSS INCOME               MAXIMUM REAL PROPERTY TAX
ONE HUNDRED THOUSAND                 EIGHT AND ONE-HALF PERCENT OF THE
DOLLARS OR LESS                      HOUSEHOLD GROSS INCOME
MORE THAN ONE HUNDRED                NO LIMITATION.
THOUSAND DOLLARS

  (III) FOR TAX YEARS BEGINNING IN TWO THOUSAND ELEVEN:
HOUSEHOLD GROSS INCOME               MAXIMUM REAL PROPERTY TAX
ONE HUNDRED THOUSAND DOLLARS         SEVEN AND ONE-HALF PERCENT OF
OR LESS                              HOUSEHOLD GROSS INCOME
MORE THAN ONE HUNDRED THOUSAND       SEVEN AND ONE-HALF PERCENT OF
DOLLARS, BUT LESS THAN OR EQUAL TO   ONE HUNDRED THOUSAND DOLLARS
ONE HUNDRED FIFTY THOUSAND DOLLARS   PLUS EIGHT AND ONE-HALF PERCENT OF
                                     HOUSEHOLD GROSS INCOME ABOVE
                                     ONE HUNDRED THOUSAND DOLLARS
MORE THAN ONE HUNDRED FIFTY          NO LIMITATION.
THOUSAND DOLLARS

  (IV) FOR TAX YEARS BEGINNING IN TWO THOUSAND TWELVE AND THEREAFTER:
HOUSEHOLD GROSS INCOME               MAXIMUM REAL PROPERTY TAX
ONE HUNDRED THOUSAND                 SIX PERCENT OF HOUSEHOLD GROSS
DOLLARS OR LESS                      INCOME
MORE THAN ONE HUNDRED THOUSAND       SIX PERCENT OF ONE HUNDRED
DOLLARS, BUT LESS THAN OR EQUAL TO   THOUSAND DOLLARS PLUS SEVEN
ONE HUNDRED FIFTY THOUSAND DOLLARS   PERCENT OF HOUSEHOLD GROSS INCOME
                                     ABOVE ONE HUNDRED THOUSAND DOLLARS
MORE THAN ONE HUNDRED FIFTY          SIX PERCENT OF ONE HUNDRED THOUSAND
THOUSAND DOLLARS, BUT LESS THAN      DOLLARS PLUS SEVEN
OR EQUAL TO TWO HUNDRED FIFTY        PERCENT OF FIFTY THOUSAND DOLLARS
THOUSAND DOLLARS                     PLUS EIGHT AND ONE-HALF PERCENT OF
                                     HOUSEHOLD GROSS INCOME ABOVE ONE
                                     HUNDRED FIFTY THOUSAND DOLLARS
MORE THAN TWO HUNDRED FIFTY          NO LIMITATION.
THOUSAND DOLLARS
  (B)  THE  THRESHOLDS  OF  HOUSEHOLD GROSS INCOME ESTABLISHED BY CLAUSE
(IV) OF  SUBPARAGRAPH  (A)  OF  THIS  PARAGRAPH  SHALL  BE  INDEXED  FOR
INFLATION FOR TAX YEARS BEGINNING IN TWO THOUSAND THIRTEEN AND THEREAFT-
ER.

S. 4239                             4

  (4) EXCLUSIONS FROM ELIGIBILITY. NO CREDIT SHALL BE GRANTED UNDER THIS
SUBSECTION  IF  THE  QUALIFIED  TAXPAYER  CLAIMS  THE  REAL PROPERTY TAX
CIRCUIT BREAKER CREDIT, PURSUANT TO  SUBSECTION  (E)  OF  THIS  SECTION,
DURING THE TAXABLE YEAR.
  S 2. This act shall take effect immediately.

Co-Sponsors

view additional co-sponsors

S4239A (ACTIVE) - Details

See Assembly Version of this Bill:: A8702
Current Committee:: Senate Investigations And Government Operations
Law Section:: Tax Law
Laws Affected:: Amd §606, Tax L
Versions Introduced in Other Legislative Sessions:: 2011-2012: S912, A5542
2013-2014: S3266, A5834
2015-2016: S3110, A6458
2017-2018: S4579, A6270
2019-2020: S3982, A5750
2021-2022: S1434

S4239A (ACTIVE) - Summary

Creates the middle class circuit breaker tax credit and a tax reform study commission.

S4239A (ACTIVE) - Sponsor Memo

 BILL NUMBER:  S4239A

 TITLE OF BILL :
An act to amend the tax law, in relation to creating the middle class
circuit breaker tax credit and creating a tax reform study commission


 PURPOSE OR GENERAL IDEA OF BILL :
To provide a personal income tax credit for certain property taxpayers
who pay a disproportionate share of their income to property taxes.

 SUMMARY OF SPECIFIC PROVISIONS :
SECTION 1: Adds a new subsection (qq) to section 606 of the tax law to
provide for a real property tax credit. The credit will be based on
the income of the household and the percentage that said household
pays for real property taxes.

 FOR HOMEOWNERS

For taxable years starting in 2009:
Household Adjusted Gross Income Tax    Maximum Real Property Tax

$100,000 or less                       Real Property taxes paid in
                                       excess of 9% of said income
                                       can receive a personal income
                                       tax credit of 70% of the overage.

$100,001 +                             No credit.

For taxable years starting in 2010:
Household Adjusted Gross
Income Tax                             Maximum Real Property Tax

$100,000 or less                       Real Property taxes paid
                                       in excess of 8.5% of said
                                       of said income can receive
                                       a personal income tax credit
                                       of 70% of the overage.

$100,001 +                             No credit.

For taxable years starting in 2011:
Household Adjusted Gross Income Tax    Maximum Real Property Tax

$100,000 or less                       Real Property taxes paid in
                                       excess of 7.5% of said income
                                       can receive a personal income
                                       tax credit of 70% of the overage.

$100,001 - $150,000                    Real Property taxes paid in
                                       excess of 7.5% of the first
                                       $100,000 of said income PLUS
                                       8.5% of said income above
                                       $100,000 can receive a personal
                                       income tax credit of 70% of the
                                       overage.

$150,001 +                             No credit.

For taxable years starting in 2012:
Household Adjusted Gross
Income Tax                             Maximum Real Property Tax

$100,000 or less                       Real Property taxes paid
                                       in excess of 6% of said
                                       income can receive a
                                       personal income tax credit
                                       of 70% of the overage.

$100,001 - $150,000                    Real Property taxes paid in
                                       excess of 6% if the first
                                       $100,000 of said income
                                       PLUS 7% of said income above
                                       $100,000 can receive a personal
                                       income tax credit of 70% of
                                       of the overage.

$150,001 - $250,000                    Real Property taxes paid in
                                       excess of 6% of the first
                                       $100,000 of said income
                                       PLUS 7% of the next $50,000
                                       of said income PLUS 8.5% of
                                       said income above $150,000
                                       can receive a personal
                                       income tax credit of 70%
                                       of the overage.

$250,000 +                             No credit.


To  qualify,  the  taxpayer must have resided in the home for not less
than five years. Also, the taxpayer may still benefit from  the  Basic
STAR  exemption  or  the  Enhanced STAR exemption for senior citizens.
The credit will equal seventy percent  of  the  taxes  paid  over  the
allowed percentage cap as provided in the bill.

The act would also provide for a "real property tax equivalent" in the
case  of  taxpayers  who  rent real property as their primary New York
State residence.

For taxable years starting in 2010 the "real property tax  equivalent"
equal  to  15% of the adjusted rent actually paid in the taxable year.
taxable years starting in 2011, the amount is increased to 20% of  the
adjusted rent actually paid in the taxable year.

SECTION  2:  Creates  a  tax reform study commission with appointments
from the Senate, Assembly  and  the  Executive.  The  commission  will
review  the  state's  existing property tax reform programs as well as
programs enacted in other states.

SECTION 3: Contains the effective date.

 JUSTIFICATION :
The middle class property tax circuit breaker  program  is  a  concept
that  has  successfully  been used in several states to Provide relief
from a residential homeowner's property tax when it exceeds a  certain
portion  of their household income. It has been traditionally Used for
homeowners with very low incomes and low assessments. New  York  State
currently  has  a  circuit  breaker  provision  that  has  existed for
decades, but the maximum eligible household income is $18,000 and  the
maximum  eligible home value is $85,000. This new program would target
middle-class  New   Yorkers   who   have   financially   suffered   as
municipalities  have  had  to rely more heavily on real property taxes
for local government revenue. Many homeowners are  facing  sky-racking
real  property  tax  bills  as  a result they are often faced with the
serious threat of defaulting on their property taxes and/or  seriously
consider selling their homes.

Critics  of  the  New  York's  STAR  program  have  claimed that it is
inequitable because it does not draw a connection between a taxpayer's
household income and the amount of his tax bill. The Middle Class STAR
Rebate Checks program, which began in 1970 and was eliminated in 2009,
compounded this effect because  it  calculated  a  household's  rebate
amount  as  a  percentage  of  the  value  of its STAR exemption. This
legislation seeks to resolve these limitations and remain sensitive to
the  State's  current financial crisis.   Additionally, the bill would
add progressivity to property tax relief and extend  the  benefits  to
property  renters  who  are  often burdened with property taxes in the
cost of their rent. The bill is phased in over four years in order  to
take  the  state's  fiscal situation into consideration while ensuring
that  the  most  overburdened  property  taxpayers  _  based  on   the
percentage  of  income they are paying in property tax on their home _
will get relief quickly.

 PRIOR LEGISLATIVE HISTORY :
None.

 FISCAL IMPLICATIONS :
The program is phased in over four years.  and  will  cost  the  State
nothing in the first year. For year two the cost will be $1.1 billion;
year  three will cost $1.8 billion and every year after will cost $2.3
billion.

 EFFECTIVE DATE :
Immediately after enactment.

S4239A (ACTIVE) - Bill Text download pdf

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

                                 4239--A

                       2009-2010 Regular Sessions

                            I N  S E N A T E

                             April 20, 2009
                               ___________

Introduced   by   Sens.   KRUEGER,   ADDABBO,  BONACIC,  BRESLIN,  DIAZ,
  HASSELL-THOMPSON, LITTLE, MONTGOMERY, ONORATO, SAMPSON,  SCHNEIDERMAN,
  STEWART-COUSINS -- 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 creating the middle class
  circuit breaker tax credit and creating a tax reform study commission

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

  Section  1.  Section  606  of  the  tax law is amended by adding a new
subsection (qq) to read as follows:
  (QQ) MIDDLE CLASS CIRCUIT BREAKER CREDIT.  (1)  DEFINITIONS.  FOR  THE
PURPOSES OF THIS SUBSECTION:
  (A)  "QUALIFIED TAXPAYER" MEANS A RESIDENT INDIVIDUAL OF THE STATE WHO
OWNS OR RENTS THE RESIDENTIAL REAL PROPERTY IN WHICH HE OR SHE  RESIDES,
AND HAS RESIDED IN SUCH RESIDENTIAL REAL PROPERTY FOR NOT LESS THAN FIVE
YEARS.
  (B)  "HOUSEHOLD"  OR  "MEMBERS  OF  THE  HOUSEHOLD"  MEANS A QUALIFIED
TAXPAYER OR QUALIFIED TAXPAYERS AND ALL OTHER PERSONS,  NOT  NECESSARILY
RELATED,  WHO  ALL  RESIDE IN THE RESIDENTIAL REAL PROPERTY OWNED BY THE
TAXPAYER OR TAXPAYERS, AND SHARE ITS FURNISHINGS, FACILITIES AND  ACCOM-
MODATIONS;  PROVIDED  THAT  NO  PERSON  MAY BE A MEMBER OF MORE THAN ONE
HOUSEHOLD AT ONE TIME.
  (C) "HOUSEHOLD GROSS INCOME" MEANS THE AGGREGATE ADJUSTED GROSS INCOME
OF ALL MEMBERS OF THE HOUSEHOLD FOR THE TAXABLE  YEAR  AS  REPORTED  FOR
FEDERAL  INCOME  TAX  PURPOSES,  OR  WHICH WOULD BE REPORTED AS ADJUSTED
GROSS INCOME IF A FEDERAL INCOME TAX RETURN WERE REQUIRED TO  BE  FILED,
WITH  THE  MODIFICATIONS IN SUBSECTION (B) OF SECTION SIX HUNDRED TWELVE
OF THIS ARTICLE BUT WITHOUT THE MODIFICATIONS IN SUBSECTION (C) OF  SUCH
SECTION, PLUS ANY PORTION OF THE GAIN FROM THE SALE OR EXCHANGE OF PROP-

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD10999-02-9

S. 4239--A                          2

ERTY  OTHERWISE  EXCLUDED  FROM  SUCH AMOUNT; EARNED INCOME FROM SOURCES
WITHOUT THE UNITED  STATES  EXCLUDABLE  FROM  FEDERAL  GROSS  INCOME  BY
SECTION  NINE HUNDRED ELEVEN OF THE INTERNAL REVENUE CODE; SUPPORT MONEY
NOT  INCLUDED  IN  ADJUSTED  GROSS  INCOME;  NONTAXABLE STRIKE BENEFITS;
SUPPLEMENTAL SECURITY INCOME PAYMENTS; THE GROSS AMOUNT OF  ANY  PENSION
OR  ANNUITY  BENEFITS  TO THE EXTENT NOT INCLUDED IN SUCH ADJUSTED GROSS
INCOME (INCLUDING, BUT NOT LIMITED TO, RAILROAD RETIREMENT BENEFITS  AND
ALL  PAYMENTS  RECEIVED UNDER THE FEDERAL SOCIAL SECURITY ACT AND VETER-
ANS' DISABILITY PENSIONS); NONTAXABLE INTEREST RECEIVED FROM  THE  STATE
OF  NEW  YORK,  ITS AGENCIES, INSTRUMENTALITIES, PUBLIC CORPORATIONS, OR
POLITICAL SUBDIVISIONS (INCLUDING A PUBLIC CORPORATION CREATED  PURSUANT
TO  AGREEMENT OR COMPACT WITH ANOTHER STATE OR CANADA); WORKERS' COMPEN-
SATION; THE GROSS AMOUNT OF "LOSS-OF-TIME" INSURANCE; AND THE AMOUNT  OF
CASH PUBLIC ASSISTANCE AND RELIEF, OTHER THAN MEDICAL ASSISTANCE FOR THE
NEEDY,  PAID  TO OR FOR THE BENEFIT OF THE QUALIFIED TAXPAYER OR MEMBERS
OF HIS OR HER HOUSEHOLD. HOUSEHOLD  GROSS  INCOME  SHALL    NOT  INCLUDE
SURPLUS  FOODS  OR  OTHER RELIEF IN KIND OR PAYMENTS MADE TO INDIVIDUALS
BECAUSE OF THEIR STATUS AS VICTIMS OF NAZI  PERSECUTION  AS  DEFINED  IN
PUBLIC  LAW  103-286 OR ANY DISABILITY COMPENSATION RECEIVED BY VETERANS
ON ACCOUNT OF INJURY OR ILLNESS INCURRED OR AGGRAVATED  DURING  MILITARY
SERVICE  IN  THE  WARS IN AFGHANISTAN AND IRAQ SINCE SEPTEMBER ELEVENTH,
TWO THOUSAND ONE.  PROVIDED, FURTHER, HOUSEHOLD GROSS INCOME SHALL  ONLY
INCLUDE  ALL  SUCH INCOME RECEIVED BY ALL MEMBERS OF THE HOUSEHOLD WHILE
MEMBERS OF SUCH HOUSEHOLD.
  (D) "ADJUSTED RENT" MEANS RENT PAID FOR THE RIGHT OF  OCCUPANCY  OF  A
RESIDENCE.
  (E)  "REAL PROPERTY TAX EQUIVALENT" MEANS (1) FOR TAXABLE YEARS BEGIN-
NING IN TWO THOUSAND TEN, FIFTEEN PERCENT OF THE ADJUSTED RENT  ACTUALLY
PAID IN THE TAXABLE YEAR BY A HOUSEHOLD SOLELY FOR THE RIGHT OF OCCUPAN-
CY OF ITS NEW YORK RESIDENCE FOR THE TAXABLE YEAR. IF (I) A RESIDENCE IS
RENTED  TO  TWO  OR  MORE  INDIVIDUALS AS COTENANTS, OR SUCH INDIVIDUALS
SHARE IN THE PAYMENT OF A SINGLE RENT FOR THE RIGHT OF OCCUPANCY OF SUCH
RESIDENCE, AND (II) EACH OF SUCH INDIVIDUALS  IS A MEMBER OF  A  DIFFER-
ENT  HOUSEHOLD,  ONE OR MORE OF WHICH INDIVIDUALS SHARES SUCH RESIDENCE,
REAL PROPERTY TAX EQUIVALENT IS THAT PORTION OF FIFTEEN PERCENT  OF  THE
ADJUSTED  RENT  PAID  IN THE TAXABLE YEAR WHICH REFLECTS THAT PORTION OF
THE RENT ATTRIBUTABLE TO THE QUALIFIED TAXPAYER AND THE MEMBERS  OF  HIS
OR  HER  HOUSEHOLD;  AND (2) FOR TAXABLE YEARS BEGINNING IN TWO THOUSAND
ELEVEN AND THEREAFTER, TWENTY PERCENT OF THE ADJUSTED RENT ACTUALLY PAID
IN THE TAXABLE YEAR  BY A HOUSEHOLD SOLELY FOR THE RIGHT OF OCCUPANCY OF
ITS NEW YORK RESIDENCE FOR THE TAXABLE YEAR. IF (I) A RESIDENCE IS RENT-
ED TO TWO OR MORE INDIVIDUALS AS COTENANTS, OR SUCH INDIVIDUALS SHARE IN
THE PAYMENT OF A SINGLE RENT FOR THE RIGHT OF OCCUPANCY  OF  SUCH  RESI-
DENCE,  AND  (II)  EACH  OF  SUCH INDIVIDUALS IS A MEMBER OF A DIFFERENT
HOUSEHOLD, ONE OR MORE OF WHICH INDIVIDUALS SHARES SUCH RESIDENCE,  REAL
PROPERTY  TAX  EQUIVALENT  IS  THAT  PORTION  OF  TWENTY  PERCENT OF THE
ADJUSTED RENT PAID IN THE TAXABLE YEAR WHICH REFLECTS  THAT  PORTION  OF
THE  RENT  ATTRIBUTABLE TO THE QUALIFIED TAXPAYER AND THE MEMBERS OF HIS
OR HER HOUSEHOLD.
  (F) "NET REAL PROPERTY TAX" MEANS THE REAL PROPERTY TAXES ASSESSED  ON
THE  RESIDENTIAL  REAL  PROPERTY  OWNED  AND OCCUPIED BY THE TAXPAYER OR
TAXPAYERS AFTER ANY EXEMPTION OR ABATEMENT RECEIVED PURSUANT TO THE REAL
PROPERTY TAX LAW.
  (2) CREDIT. A QUALIFIED TAXPAYER SHALL BE ALLOWED A CREDIT AGAINST THE
TAXES IMPOSED BY THIS ARTICLE, EQUAL TO SEVENTY PERCENT OF THE AMOUNT BY
WHICH THE TAXPAYER'S NET REAL PROPERTY TAX OR THE TAXPAYER'S REAL  PROP-

S. 4239--A                          3

ERTY TAX EQUIVALENT EXCEEDS THE TAXPAYER'S MAXIMUM REAL PROPERTY TAX, AS
DETERMINED BY PARAGRAPH THREE OF THIS SUBSECTION. IF SUCH CREDIT EXCEEDS
THE TAX FOR SUCH TAXABLE YEAR, AS REDUCED BY THE OTHER CREDITS PERMITTED
BY  THIS  ARTICLE,  THE  QUALIFIED  TAXPAYER  MAY RECEIVE, AND THE COMP-
TROLLER, SUBJECT TO A CERTIFICATE OF THE DEPARTMENT,  SHALL  PAY  AS  AN
OVERPAYMENT, WITHOUT INTEREST, ANY EXCESS BETWEEN SUCH TAX AS SO REDUCED
AND THE AMOUNT OF THE CREDIT. IF A QUALIFIED TAXPAYER IS NOT REQUIRED TO
FILE A RETURN PURSUANT TO SECTION SIX HUNDRED FIFTY-ONE OF THIS ARTICLE,
A  QUALIFIED  TAXPAYER  MAY  NEVERTHELESS  RECEIVE  AND THE COMPTROLLER,
SUBJECT TO A CERTIFICATE OF THE DEPARTMENT, SHALL PAY AS AN  OVERPAYMENT
THE FULL AMOUNT OF THE CREDIT, WITHOUT INTEREST.
  (3) MAXIMUM REAL PROPERTY TAX. (A) A QUALIFIED TAXPAYER'S MAXIMUM REAL
PROPERTY TAX SHALL BE DETERMINED AS FOLLOWS:
  (I) FOR TAX YEARS BEGINNING IN TWO THOUSAND NINE:
HOUSEHOLD GROSS INCOME               MAXIMUM REAL PROPERTY TAX
ONE HUNDRED THOUSAND                 NINE PERCENT OF THE
DOLLARS OR LESS                      HOUSEHOLD GROSS INCOME
MORE THAN ONE HUNDRED                NO LIMITATION.
THOUSAND DOLLARS

  (II) FOR TAX YEARS BEGINNING IN TWO THOUSAND TEN:
HOUSEHOLD GROSS INCOME               MAXIMUM REAL PROPERTY TAX
ONE HUNDRED THOUSAND                 EIGHT AND ONE-HALF PERCENT OF THE
DOLLARS OR LESS                      HOUSEHOLD GROSS INCOME
MORE THAN ONE HUNDRED                NO LIMITATION.
THOUSAND DOLLARS

  (III) FOR TAX YEARS BEGINNING IN TWO THOUSAND ELEVEN:
HOUSEHOLD GROSS INCOME               MAXIMUM REAL PROPERTY TAX
ONE HUNDRED THOUSAND DOLLARS         SEVEN AND ONE-HALF PERCENT OF
OR LESS                              HOUSEHOLD GROSS INCOME
MORE THAN ONE HUNDRED THOUSAND       SEVEN AND ONE-HALF PERCENT OF
DOLLARS, BUT LESS THAN OR EQUAL TO   ONE HUNDRED THOUSAND DOLLARS
ONE HUNDRED FIFTY THOUSAND DOLLARS   PLUS EIGHT AND ONE-HALF PERCENT OF
                                     HOUSEHOLD GROSS INCOME ABOVE
                                     ONE HUNDRED THOUSAND DOLLARS
MORE THAN ONE HUNDRED FIFTY          NO LIMITATION.
THOUSAND DOLLARS

  (IV) FOR TAX YEARS BEGINNING IN TWO THOUSAND TWELVE AND THEREAFTER:
HOUSEHOLD GROSS INCOME               MAXIMUM REAL PROPERTY TAX
ONE HUNDRED THOUSAND                 SIX PERCENT OF HOUSEHOLD GROSS
DOLLARS OR LESS                      INCOME
MORE THAN ONE HUNDRED THOUSAND       SIX PERCENT OF ONE HUNDRED
DOLLARS, BUT LESS THAN OR EQUAL TO   THOUSAND DOLLARS PLUS SEVEN
ONE HUNDRED FIFTY THOUSAND DOLLARS   PERCENT OF HOUSEHOLD GROSS INCOME
                                     ABOVE ONE HUNDRED THOUSAND DOLLARS
MORE THAN ONE HUNDRED FIFTY          SIX PERCENT OF ONE HUNDRED THOUSAND
THOUSAND DOLLARS, BUT LESS THAN      DOLLARS PLUS SEVEN
OR EQUAL TO TWO HUNDRED FIFTY        PERCENT OF FIFTY THOUSAND DOLLARS
THOUSAND DOLLARS                     PLUS EIGHT AND ONE-HALF PERCENT OF
                                     HOUSEHOLD GROSS INCOME ABOVE ONE
                                     HUNDRED FIFTY THOUSAND DOLLARS
MORE THAN TWO HUNDRED FIFTY          NO LIMITATION.
THOUSAND DOLLARS

S. 4239--A                          4

  (B)  THE  THRESHOLDS  OF  HOUSEHOLD GROSS INCOME ESTABLISHED BY CLAUSE
(IV) OF  SUBPARAGRAPH  (A)  OF  THIS  PARAGRAPH  SHALL  BE  INDEXED  FOR
INFLATION FOR TAX YEARS BEGINNING IN TWO THOUSAND THIRTEEN AND THEREAFT-
ER.
  (4) EXCLUSIONS FROM ELIGIBILITY. NO CREDIT SHALL BE GRANTED UNDER THIS
SUBSECTION  IF  THE  QUALIFIED  TAXPAYER  CLAIMS  THE  REAL PROPERTY TAX
CIRCUIT BREAKER CREDIT, PURSUANT TO  SUBSECTION  (E)  OF  THIS  SECTION,
DURING THE TAXABLE YEAR.
  S  2.  There  is  hereby  established a tax reform study commission to
provide the governor and the  legislature  with  a  long  run  plan  for
reforming  the state and local tax systems. The tax reform study commis-
sion shall consist of five  members  appointed  by  the  governor,  four
members  each appointed by the speaker of the assembly and the temporary
president of the senate, and one member each appointed by  the  minority
leader  of  the senate and the minority leader of the assembly. In addi-
tion, on or before the first day of January, two  thousand  eleven,  the
tax  reform study commission shall provide the governor and the legisla-
ture with recommendations on any changes that  should  be  made  in  the
definitions  of  income used in the various property tax relief programs
authorized by the laws of the state of New  York.  Such  recommendations
shall  be based on an examination of such laws and of such laws in other
states. In preparing such recommendations, the tax reform study  commis-
sion  shall  review  the  distributional  impact  of the items of income
included in the definition of  household  income  for  purposes  of  the
circuit  breaker  and  other property tax relief programs established by
state law and make recommendations to the governor and  the  legislature
for  any  changes  in any of these definitions that the tax reform study
commission deems appropriate. The commissioner of taxation  and  finance
and  the  director of the office of real property services shall provide
the tax reform study commission with such data and analysis  as  it  may
require.
  S 3. This act shall take effect immediately.

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The New York State Senate

senate Bill S4239A

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senate Bill S4239A

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

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