S T A T E   O F   N E W   Y O R K
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                                  3946

                       2009-2010 Regular Sessions

                          I N  A S S E M B L Y

                            January 29, 2009
                               ___________

Introduced  by  M.  of  A. WEPRIN, MORELLE, SCHIMMINGER, SWEENEY, CLARK,
  HOOPER -- Multi-Sponsored by -- M. of A. CAHILL, CHRISTENSEN,  COLTON,
  COOK,  CYMBROWITZ,  DelMONTE,  DESTITO,  DIAZ,  ESPAILLAT, JOHN, KOON,
  MAGEE, MAGNARELLI, McENENY, ORTIZ, PHEFFER -- read once  and  referred
  to the Committee on Insurance

AN  ACT  to  amend  the  tax  law  and the insurance law, in relation to
  providing a tax credit for the purchase of health insurance by  quali-
  fied small employers

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

  Section 1. Section 210 of the tax law  is  amended  by  adding  a  new
subdivision 41 to read as follows:
  41.  SMALL  EMPLOYER HEALTH CARE INSURANCE CREDIT.  (A) A TAXPAYER WHO
IS A QUALIFIED SMALL EMPLOYER SHALL BE ALLOWED A CREDIT AGAINST THE  TAX
IMPOSED  BY  THIS  ARTICLE  EQUAL  TO TWENTY PERCENT OF THE PREMIUM PAID
DURING THE TAXABLE YEAR FOR HEALTH INSURANCE BY SUCH EMPLOYER.
  (B) THE CREDIT ALLOWED UNDER THIS SUBDIVISION FOR ANY YEAR  SHALL  NOT
REDUCE  THE TAX DUE FOR SUCH YEAR TO LESS THAN THE HIGHER OF THE AMOUNTS
PRESCRIBED IN PARAGRAPHS (C) AND (D) OF SUBDIVISION ONE OF THIS SECTION.
IF, HOWEVER, THE AMOUNT OF CREDIT ALLOWABLE UNDER THIS  SUBDIVISION  FOR
ANY  TAXABLE  YEAR  REDUCES THE TAX TO SUCH AMOUNT, ANY AMOUNT OF CREDIT
NOT DEDUCTIBLE IN SUCH TAXABLE YEAR MAY BE CARRIED OVER TO THE FOLLOWING
YEAR OR YEARS AND MAY BE DEDUCTED FROM THE TAXPAYER'S TAX FOR SUCH  YEAR
OR YEARS.
  (C)  FOR  THE  PURPOSES OF THIS SUBDIVISION "QUALIFIED SMALL EMPLOYER"
SHALL MEAN AN INDIVIDUAL PROPRIETOR WHO IS  THE  SOLE  EMPLOYEE  OF  THE
BUSINESS OR AN EMPLOYER WITH NOT MORE THAN FIFTY EMPLOYEES:
  (A)  WHO IS A "SMALL BUSINESS TAXPAYER" AS DEFINED IN PARAGRAPH (F) OF
SUBDIVISION ONE OF THIS SECTION; AND

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD07042-02-9

A. 3946                             2
              

  (B) WHO IS INELIGIBLE FOR OR NOT PARTICIPATING IN ANY  PROGRAM  ESTAB-
LISHED PURSUANT TO SECTION FOUR THOUSAND THREE HUNDRED TWENTY-SIX OF THE
INSURANCE LAW.
  (D)  FOR THE PURPOSES OF THIS SUBDIVISION, THE TERM "HEALTH INSURANCE"
MEANS AN ACCIDENT AND HEALTH INSURANCE POLICY SUBJECT TO THE  PROVISIONS
OF  SECTION  THREE  THOUSAND  TWO  HUNDRED  SIXTEEN,  THREE THOUSAND TWO
HUNDRED TWENTY-ONE, FOUR THOUSAND THREE HUNDRED THREE OR  FOUR  THOUSAND
EIGHT  HUNDRED  ONE  OF THE INSURANCE LAW, AND ARTICLE FORTY-FOUR OF THE
PUBLIC HEALTH LAW.
  S 2. Subparagraph (B) of paragraph 1 of subsection (i) of section  606
of  the  tax  law, as amended by section 2 of part ZZ-1 of chapter 57 of
the laws of 2008, is amended to read as follows:
  (B) shall be treated as the owner of a new business  with  respect  to
such  share  if  the corporation qualifies as a new business pursuant to
paragraph (j) of subdivision twelve of section two hundred ten  of  this
chapter.

                                     The corporation's credit base under
                                     section two hundred ten or section
With respect to the following        fourteen hundred fifty-six of this
credit under this section:           chapter is:

(I) Investment tax credit            Investment credit base
under subsection (a)                 or qualified
                                     rehabilitation
                                     expenditures under
                                     subdivision twelve of
                                     section two hundred ten

(II) Empire zone                     Cost or other basis
investment tax credit                under subdivision
under subsection (j)                 twelve-B
                                     of section two hundred
                                     ten

(III) Empire zone                    Eligible wages under
wage tax credit                      subdivision nineteen of
under subsection (k)                 section two hundred ten
                                     or subsection (e) of
                                     section fourteen hundred
                                     fifty-six

(IV) Empire zone                     Qualified investments
capital tax credit                   and contributions under
under subsection (l)                 subdivision twenty of
                                     section two hundred ten
                                     or subsection (d) of
                                     section fourteen hundred
                                     fifty-six

(V) Agricultural property tax        Allowable school
credit under subsection (n)          district property taxes under
                                     subdivision twenty-two of
                                     section two hundred ten

A. 3946                             3

(VI) Credit for employment           Qualified first-year wages or
of persons with dis-                 qualified second-year wages
abilities under                      under subdivision
subsection (o)                       twenty-three of section
                                     two hundred ten
                                     or subsection (f)
                                     of section fourteen
                                     hundred fifty-six

(VII) Employment incentive           Applicable investment credit
credit under subsec-                 base under subdivision
tion (a-1)                           twelve-D of section two
                                     hundred ten

(VIII) Empire zone                   Applicable investment
employment                           credit under sub-
incentive credit under               division twelve-C
subsection (j-1)                     of section two hundred ten

(IX) Alternative fuels credit        Cost under subdivision
under subsection (p)                 twenty-four of section two
                                     hundred ten

(X) Qualified emerging               Applicable credit base
technology company                   under subdivision twelve-E
employment credit                    of section two hundred ten
under subsection (q)

(XI) Qualified emerging              Qualified investments under
technology company                   subdivision twelve-F of
capital tax credit                   section two hundred ten
under subsection (r)

(XII) Credit for purchase of an      Cost of an automated
automated external defibrillator     external defibrillator under
under subsection (s)                 subdivision twenty-five of
                                     section two hundred ten
                                     or subsection (j) of section
                                     fourteen hundred fifty-six

(XIII) Low-income housing            Credit amount under
credit under subsection (x)          subdivision thirty
                                     of section two hundred ten or
                                     subsection (l) of section
                                     fourteen hundred fifty-six

(XIV) Credit for transportation      Amount of credit under sub-
improvement contributions            division thirty-two of section
under subsection (z)                 two hundred ten or subsection
                                     (n) of section fourteen
                                     hundred fifty-six

(XV) QEZE credit for real property   Amount of credit under
taxes under subsection (bb)          subdivision twenty-seven of
                                     section two hundred ten or
                                     subsection (o) of section

A. 3946                             4

                                     fourteen hundred fifty-six

(XVI) QEZE tax reduction credit      Amount of benefit period
under subsection (cc)                factor, employment increase factor
                                     and zone allocation
                                     factor (without regard
                                     to pro ration) under
                                     subdivision twenty-eight of
                                     section two hundred ten or
                                     subsection (p) of section
                                     fourteen hundred fifty-six
                                     and amount of tax factor
                                     as determined under
                                     subdivision (f) of section sixteen

(XVII) Green building credit         Amount of green building credit
under subsection (y)                 under subdivision thirty-one
                                     of section two hundred ten
                                     or subsection (m) of section
                                     fourteen hundred fifty-six

(XVIII) Credit for long-term         Qualified costs under
care insurance premiums              subdivision twenty-five-a of
under subsection (aa)                section two hundred ten
                                     or subsection (k) of section
                                     fourteen hundred fifty-six

(XIX) Brownfield redevelopment       Amount of credit
credit under subsection              under subdivision
(dd)                                 thirty-three of section
                                     two hundred ten
                                     or subsection (q) of
                                     section fourteen hundred
                                     fifty-six

(XX) Remediated brownfield           Amount of credit under
credit for real property             subdivision thirty-four
taxes for qualified                  of section two hundred
sites under subsection               ten or subsection (r) of
(ee)                                 section fourteen hundred
                                     fifty-six

(XXI) Environmental                  Amount of credit under
remediation                          subdivision thirty-five of
insurance credit under               section two hundred
subsection (ff)                      ten or subsection
                                     (s) of section
                                     fourteen hundred
                                     fifty-six

(XXII) Empire state film production  Amount of credit for qualified
credit under subsection (gg)         production costs in production
                                     of a qualified film under
                                     subdivision thirty-six of
                                     section two hundred ten

A. 3946                             5

(XXIII) Qualified emerging           Qualifying expenditures and
technology company facilities,       development activities under
operations and training credit       subdivision twelve-G of section
under subsection (nn)                two hundred ten

(XXIV) Security training tax         Amount of credit
credit under                         under subdivision thirty-seven
subsection (ii)                      of section two hundred ten or
                                     under subsection (t) of
                                     section fourteen hundred fifty-six

(XXV) Credit for qualified fuel      Amount of credit under
cell electric generating equipment   subdivision thirty-seven
expenditures under subsection (g-2)  of section two hundred ten
                                     or subsection (t) of
                                     section fourteen hundred
                                     fifty-six

(XXVI) Empire state commercial       Amount of credit for qualified
production credit under subsection   production costs in production
(jj)                                 of a qualified commercial under
                                     subdivision thirty-eight of sec-
                                     tion two hundred ten

(XXVII) Biofuel production           Amount of credit
tax credit under                     under subdivision
subsection (jj)                      thirty-eight of
                                     section two hundred ten

(XXVIII) Clean heating fuel credit   Amount of credit under
under subsection (mm)                subdivision thirty-nine of
                                     section two hundred ten

(XXIX) Credit for rehabilitation     Amount of credit under
of historic properties               subdivision forty of
under subsection (oo)                [subsection] SECTION two hundred ten

(XXX) Credit for companies who       Amount of credit under
provide transportation               subdivision forty of
to individuals                       section two hundred ten
with disabilities
under subsection (oo)

(XXXI) SMALL EMPLOYER HEALTH         CREDIT UNDER SUBDIVISION
CARE INSURANCE CREDIT                FORTY-ONE OF SECTION TWO
UNDER SUBSECTION (QQ)                HUNDRED TEN
  S  3. Section 606 of the tax law is amended by adding a new subsection
(qq) to read as follows:
  (QQ) SMALL EMPLOYER HEALTH CARE INSURANCE CREDIT. (1) A  TAXPAYER  WHO
IS  A QUALIFIED SMALL EMPLOYER SHALL BE ALLOWED A CREDIT AGAINST THE TAX
IMPOSED BY THIS ARTICLE EQUAL TO TWENTY PERCENT OF THE PREMIUM  PAID  BY
SUCH EMPLOYER AND EMPLOYEE FOR HEALTH INSURANCE DURING THE TAXABLE YEAR.
  (2)  FOR  THE  PURPOSES  OF THIS SUBSECTION "QUALIFIED SMALL EMPLOYER"
SHALL MEAN AN INDIVIDUAL PROPRIETOR WHO IS  THE  SOLE  EMPLOYEE  OF  THE
BUSINESS OR AN EMPLOYER WITH NOT MORE THAN FIFTY EMPLOYEES:

A. 3946                             6

  (I)  WHO IS A "SMALL BUSINESS TAXPAYER" AS DEFINED IN PARAGRAPH (F) OF
SUBDIVISION ONE OF SECTION TWO HUNDRED TEN OF THIS CHAPTER; AND
  (II)  WHO IS INELIGIBLE FOR OR NOT PARTICIPATING IN ANY PROGRAM ESTAB-
LISHED PURSUANT TO SECTION FOUR THOUSAND THREE HUNDRED TWENTY-SIX OF THE
INSURANCE LAW.
  (3) FOR THE PURPOSES OF THIS SUBSECTION, THE TERM  "HEALTH  INSURANCE"
MEANS  AN ACCIDENT AND HEALTH INSURANCE POLICY SUBJECT TO THE PROVISIONS
OF SECTION THREE  THOUSAND  TWO  HUNDRED  SIXTEEN,  THREE  THOUSAND  TWO
HUNDRED  TWENTY-ONE,  FOUR THOUSAND THREE HUNDRED THREE OR FOUR THOUSAND
EIGHT HUNDRED ONE OF THE INSURANCE LAW, AND ARTICLE  FORTY-FOUR  OF  THE
PUBLIC HEALTH LAW.
  S 4. Section 1456 of the tax law is amended by adding a new subsection
(f-1) to read as follows:
  (F-1)(1) A TAXPAYER WHO IS A QUALIFIED SMALL EMPLOYER SHALL BE ALLOWED
A CREDIT AGAINST THE TAX IMPOSED BY THIS ARTICLE EQUAL TO TWENTY PERCENT
OF THE PREMIUM PAID DURING THE TAXABLE YEAR FOR HEALTH INSURANCE BY SUCH
EMPLOYER.
  (2)  IN  NO  EVENT  SHALL THE CREDIT PROVIDED FOR IN THIS SECTION, AND
CARRYOVERS OF SUCH CREDIT, BE ALLOWED IN AN AMOUNT WHICH WILL REDUCE THE
TAX PAYABLE TO LESS THAN THE DOLLAR AMOUNT FIXED AS  A  MINIMUM  TAX  BY
SUBSECTION  (B)  OF SECTION FOURTEEN HUNDRED FIFTY-FIVE OF THIS ARTICLE.
IF, HOWEVER, THE AMOUNT OF CREDIT OR CARRYOVERS OF SUCH CREDIT, OR BOTH,
ALLOWABLE UNDER THIS SUBSECTION FOR ANY TAXABLE YEAR REDUCES THE TAX  TO
SUCH  AMOUNT, ANY AMOUNT OF CREDIT OR CARRYOVERS OF SUCH CREDIT THUS NOT
DEDUCTIBLE IN SUCH TAXABLE YEAR MAY BE   CARRIED OVER TO  THE  FOLLOWING
YEAR  OR YEARS AND MAY BE DEDUCTED FROM THE TAXPAYER'S TAX FOR SUCH YEAR
OR YEARS.
  (3) FOR THE PURPOSES OF THIS SECTION THE TERM "QUALIFIED SMALL EMPLOY-
ER" SHALL MEAN AN INDIVIDUAL PROPRIETOR WHO IS THE SOLE EMPLOYEE OF  THE
BUSINESS OR AN EMPLOYER WITH NOT MORE THAN FIFTY EMPLOYEES:
  (I)  WHO IS A "SMALL BUSINESS TAXPAYER" AS DEFINED IN PARAGRAPH (F) OF
SUBDIVISION ONE OF SECTION TWO HUNDRED TEN OF THIS CHAPTER; AND
  (II) WHO IS INELIGIBLE FOR OR NOT PARTICIPATING IN ANY PROGRAM  ESTAB-
LISHED PURSUANT TO SECTION FOUR THOUSAND THREE HUNDRED TWENTY-SIX OF THE
INSURANCE LAW.
  (4)  FOR  THE PURPOSES OF THIS SUBSECTION, THE TERM "HEALTH INSURANCE"
MEANS AN ACCIDENT AND HEALTH INSURANCE POLICY SUBJECT TO THE  PROVISIONS
OF  SECTION  THREE  THOUSAND  TWO  HUNDRED  SIXTEEN,  THREE THOUSAND TWO
HUNDRED TWENTY-ONE, FOUR THOUSAND THREE HUNDRED THREE OR  FOUR  THOUSAND
EIGHT  HUNDRED  ONE  OF THE INSURANCE LAW, AND ARTICLE FORTY-FOUR OF THE
PUBLIC HEALTH LAW.
  S 5. Section 1511 of the tax law is amended by adding a  new  subdivi-
sion (y) to read as follows:
  (Y)  SMALL EMPLOYER HEALTH CARE INSURANCE CREDIT. (1) A TAXPAYER SHALL
BE ALLOWED A CREDIT AGAINST THE TAX IMPOSED BY  THIS  ARTICLE  EQUAL  TO
TWENTY  PERCENT  OF  THE PREMIUM PAID DURING THE TAXABLE YEAR FOR HEALTH
INSURANCE BY SUCH EMPLOYER.
  (2) IN NO EVENT SHALL THE CREDIT HEREIN PROVIDED FOR BE ALLOWED IN  AN
AMOUNT  WHICH WILL REDUCE THE TAX PAYABLE TO LESS THAN THE MINIMUM FIXED
BY SUBDIVISION (A) OF SECTION FIFTEEN HUNDRED TWO OF THIS  ARTICLE.  IF,
HOWEVER,  THE  AMOUNT OF CREDIT ALLOWABLE UNDER THIS SUBDIVISION FOR ANY
TAXABLE YEAR REDUCES THE TAX TO SUCH AMOUNT, ANY AMOUNT  OF  CREDIT  NOT
DEDUCTIBLE  IN  SUCH  TAXABLE  YEAR MAY BE CARRIED OVER TO THE FOLLOWING
YEAR OR YEARS AND MAY BE DEDUCTED FROM THE TAXPAYER'S TAX FOR SUCH  YEAR
OR YEARS.

A. 3946                             7

  (3)  FOR  THE  PURPOSES  OF THIS SUBDIVISION THE TERM "QUALIFIED SMALL
EMPLOYER" SHALL MEAN AN INDIVIDUAL PROPRIETOR WHO IS THE  SOLE  EMPLOYEE
OF THE BUSINESS OR AN EMPLOYER WITH NOT MORE THAN FIFTY EMPLOYEES:
  (I)  WHO IS A "SMALL BUSINESS TAXPAYER" AS DEFINED IN PARAGRAPH (F) OF
SUBDIVISION ONE OF SECTION TWO HUNDRED TEN OF THIS CHAPTER; AND
  (II) WHO IS INELIGIBLE FOR OR NOT PARTICIPATING IN ANY PROGRAM  ESTAB-
LISHED PURSUANT TO SECTION FOUR THOUSAND THREE HUNDRED TWENTY-SIX OF THE
INSURANCE LAW.
  (4)  FOR THE PURPOSES OF THIS SUBDIVISION, THE TERM "HEALTH INSURANCE"
MEANS AN ACCIDENT AND HEALTH INSURANCE POLICY SUBJECT TO THE  PROVISIONS
OF  SECTION  THREE  THOUSAND  TWO  HUNDRED  SIXTEEN,  THREE THOUSAND TWO
HUNDRED TWENTY-ONE, FOUR THOUSAND THREE HUNDRED THREE OR  FOUR  THOUSAND
EIGHT  HUNDRED  ONE  OF THE INSURANCE LAW, AND ARTICLE FORTY-FOUR OF THE
PUBLIC HEALTH LAW.
  S 6. The insurance law is amended by adding a new section 215 to  read
as follows:
  S  215. REPORT ON QUALIFIED SMALL EMPLOYER TAX CREDIT. THE SUPERINTEN-
DENT SHALL ORDER A STUDY OF THE IMPACT OF SECTION  FOUR  THOUSAND  THREE
HUNDRED TWENTY-SIX OF THIS CHAPTER, SUBDIVISION FORTY-ONE OF SECTION TWO
HUNDRED TEN OF THE TAX LAW, SUBSECTION (T) OF SECTION SIX HUNDRED SIX OF
THE  TAX LAW, AND SUBSECTION (F-1) OF SECTION FOURTEEN HUNDRED FIFTY-SIX
OF THE TAX LAW. SUCH STUDY SHALL EXAMINE THE NUMBER OF  PERSONS  COVERED
BY GROUP HEALTH INSURANCE OFFERED BY THEIR EMPLOYER PRIOR TO, AND AFTER,
IMPLEMENTATION  OF SUCH PROVISIONS OF SUCH SECTIONS, AND SHALL DETERMINE
THE EFFECT OF SUCH PROVISIONS OF SUCH SECTIONS ON EMPLOYEE HEALTH INSUR-
ANCE COVERAGE. THE STUDY SHALL BE COMPLETED AND A  REPORT  SUBMITTED  BY
SEPTEMBER  FIRST,  TWO  THOUSAND THIRTEEN TO THE GOVERNOR, THE TEMPORARY
PRESIDENT OF THE SENATE AND THE SPEAKER OF THE ASSEMBLY.
  S 7. This act shall take effect January  1,  2010;  provided,  however
that  the empire state film production credit under subsection (gg), the
empire state commercial production credit under subsection (jj) and  the
credit  for  companies  who  provide  transportation to individuals with
disabilities under subsection  (oo)  of  section  606  of  the  tax  law
contained  in  section  two of this act shall expire on the same date as
provided in section 9 of part P of chapter 60 of the laws  of  2004,  as
amended,  section  10  of  part  V of chapter 62 of the laws of 2006, as
amended and section 5 of chapter 522 of the laws of  2006,  as  amended,
respectively.