Senate Bill S3645

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

                                  3645

                       2009-2010 Regular Sessions

                            I N  S E N A T E

                             March 26, 2009
                               ___________

Introduced  by  Sen.  DILAN  -- read twice and ordered printed, and when
  printed to be committed to the Committee on Investigations and Govern-
  ment Operations

AN ACT to amend the tax law and the general city  law,  in  relation  to
  imposing the earnings tax on nonresidents

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

  Section 1. Section 1301 of the tax law is  amended  by  adding  a  new
subsection (c) to read as follows:
  (C)  THE  TAXES  AUTHORIZED BY THIS ARTICLE MAY BE IMPOSED ONLY IF THE
GENERAL CITY LAW AUTHORIZES THE ADOPTION OF A CITY TAX ON  THE  EARNINGS
OF NONRESIDENTS AND THE CITY IMPOSING THE TAX AUTHORIZED BY THIS ARTICLE
ALSO IMPOSES SUCH TAX ON THE EARNINGS OF NONRESIDENTS.
  S  2.  Subsection  (b)  of  section 1305 of the tax law, as amended by
chapter 5 of the laws of 1999, is amended to read as follows:
  (b) City nonresident individual. A city nonresident  individual  means
an  individual  who  is not a resident of such city [or the state of New
York].
  S 3. The general city law is amended by adding a new  article  2-E  to
read as follows:
                                ARTICLE 2-E
                    CITY EARNINGS TAX ON NONRESIDENTS
SECTION 25-M. AUTHORIZATION TO IMPOSE TAX.
        25-N. ADMINISTRATIVE PROVISIONS.
        25-O. DEPOSIT AND DISPOSITION OF REVENUES.
  S  25-M.  AUTHORIZATION TO IMPOSE TAX. IN ADDITION TO ANY OTHER TAXES,
NOW AUTHORIZED BY LAW, ANY CITY HAVING A POPULATION OF  ONE  MILLION  OR
MORE  IS  HEREBY  AUTHORIZED AND EMPOWERED TO ADOPT AND AMEND LOCAL LAWS
IMPOSING A TAX ON THE EARNINGS OF NONRESIDENTS OF SUCH CITY TO BE ADMIN-
ISTERED IN THE MANNER PROVIDED FOR IN THIS ARTICLE BY THE  ADMINISTRATOR
AS DEFINED IN SECTION ONE OF THE MODEL LOCAL LAW HEREINAFTER SET FORTH.

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD10647-02-9
              

S. 3645                             2

  THE  TAX  AUTHORIZED  BY  THIS ARTICLE MAY BE IMPOSED ONLY IF THE CITY
IMPOSING THE TAX HEREIN AUTHORIZED ALSO IMPOSES A TAX  ON  THE  PERSONAL
INCOME  OF  ITS  RESIDENTS.  THE  RATES  OF  SUCH TAX SHALL BE THE RATES
CONTAINED IN EITHER SECTION TWO OR THREE OF THE MODEL LOCAL LAW AND SUCH
RATES MAY BE REDUCED AND INCREASED, PROVIDED THAT THE RATES SHALL NOT BE
FIXED  HIGHER  THAN THOSE CONTAINED IN SECTION THREE OF SUCH MODEL LOCAL
LAW.
  THE TERMS OF SUCH LOCAL LAW SHALL BE SUBSTANTIALLY  THE  SAME  AS  THE
FOLLOWING MODEL LOCAL LAW EXCEPT THAT THE APPENDIX AND THE SUPPLEMENT TO
THE  APPENDIX  IN  SUCH  LOCAL  LAW  MAY  BE  AMENDED FOR THE PURPOSE OF
CONFORMING IT WITH THE UNITED STATES  INTERNAL  REVENUE  CODE  OR  OTHER
FEDERAL  LAWS RELATING TO TAXATION AS PRESENTLY IN EFFECT OR AS THEY MAY
BE AMENDED.
                      EARNINGS TAX ON NONRESIDENTS
                             MODEL LOCAL LAW
SECTION 1.  MEANING OF TERMS.
        2.  PERSONS SUBJECT TO TAX.
        3.  PERSONS SUBJECT TO TAX.
        4.  ALLOCATION TO THE CITY.
        5.  ACCOUNTING PERIODS AND METHODS.
        6.  WITHHOLDING OF TAX ON WAGES.
        7.  WITHHOLDING OF TAX ON WAGES FOR TAXABLE  PERIODS  COMMENCING
              ON OR AFTER JANUARY FIRST, TWO THOUSAND NINE.
        8.  INFORMATION STATEMENT FOR EMPLOYEE.
        9. CREDIT FOR TAX WITHHELD.
        10. EMPLOYER'S RETURN AND PAYMENT OF WITHHELD TAXES.
        11. EMPLOYER'S LIABILITY FOR WITHHELD TAXES.
        12. EMPLOYER'S FAILURE TO WITHHOLD.
        13. RETURNS AND PAYMENT OF TAX.
        14. COMBINED RETURNS, EMPLOYER'S RETURNS AND PAYMENTS.
        15. EFFECT  OF  INVALIDITY  IN  PART; INCONSISTENCIES WITH OTHER
              LAWS.
  S 1. MEANING OF TERMS. AS USED IN THIS LOCAL LAW, THE FOLLOWING  TERMS
SHALL MEAN AND INCLUDE:
  (A)  "ADMINISTRATOR"  MEANS  THE FINANCE ADMINISTRATOR OR OTHER FISCAL
OFFICER OF THE CITY CHARGED WITH ADMINISTRATION OF THE TAX  ON  EARNINGS
OF  NONRESIDENTS IMPOSED BY THIS LOCAL LAW, EXCEPT WITH RESPECT TO TAXES
IMPOSED FOR ANY TAXABLE YEAR BEGINNING ON OR AFTER  JANUARY  FIRST,  TWO
THOUSAND NINE, SUCH TERM SHALL MEAN STATE TAX COMMISSION.
  (B) "CITY" MEANS THE CITY IMPOSING THE TAX.
  (C)  "PAYROLL  PERIOD"  AND  "EMPLOYER" SHALL MEAN THE SAME AS PAYROLL
PERIOD AND EMPLOYER AS DEFINED IN SUBSECTIONS (B)  AND  (D)  OF  SECTION
THIRTY-FOUR  HUNDRED  ONE  OF  THE INTERNAL REVENUE CODE, AND "EMPLOYEE"
SHALL ALSO INCLUDE ALL THOSE INCLUDED AS EMPLOYEES IN SUBSECTION (C)  OF
SUCH SECTION OF SUCH CODE.
  (D)  "WAGES"  SHALL MEAN WAGES AS DEFINED IN SUBSECTION (A) OF SECTION
THIRTY-FOUR HUNDRED ONE OF THE INTERNAL REVENUE CODE,  EXCEPT  THAT  (1)
WAGES  SHALL  NOT INCLUDE PAYMENTS FOR ACTIVE SERVICE AS A MEMBER OF THE
ARMED FORCES OF THE UNITED STATES AND SHALL NOT INCLUDE, IN THE CASE  OF
A  NONRESIDENT INDIVIDUAL OR PARTNER OF A PARTNERSHIP DOING AN INSURANCE
BUSINESS AS A MEMBER OF THE NEW YORK  INSURANCE  EXCHANGE  DESCRIBED  IN
SECTION  SIX  THOUSAND TWO HUNDRED ONE OF THE INSURANCE LAW, ANY ITEM OF
INCOME, GAIN, LOSS OR DEDUCTION OF SUCH BUSINESS WHICH IS SUCH  INDIVID-
UAL'S  DISTRIBUTIVE OR PRO RATA SHARE FOR FEDERAL INCOME TAX PURPOSES OR
WHICH SUCH INDIVIDUAL IS REQUIRED TO TAKE INTO  ACCOUNT  SEPARATELY  FOR
FEDERAL  INCOME  TAX  PURPOSES AND (2) WAGES SHALL INCLUDE THE AMOUNT OF

S. 3645                             3

MEMBER OR EMPLOYEE CONTRIBUTIONS TO A RETIREMENT SYSTEM OR PENSION  FUND
PICKED  UP  OR PAID BY THE EMPLOYER PURSUANT TO SUBDIVISION F OF SECTION
FIVE HUNDRED SEVENTEEN OR SUBDIVISION D OF SECTION SIX HUNDRED  THIRTEEN
OF THE RETIREMENT AND SOCIAL SECURITY LAW.
  (E)  "NET  EARNINGS  FROM  SELF-EMPLOYMENT" SHALL MEAN THE SAME AS NET
EARNINGS FROM SELF-EMPLOYMENT AS DEFINED IN SUBSECTION  (A)  OF  SECTION
FOURTEEN  HUNDRED  TWO  OF  THE  INTERNAL  REVENUE CODE, EXCEPT THAT THE
DEDUCTION FOR WAGES AND SALARIES PAID OR INCURRED FOR THE  TAXABLE  YEAR
WHICH  IS  NOT  ALLOWED PURSUANT TO SECTION TWO HUNDRED EIGHTY-C OF SUCH
CODE SHALL BE ALLOWED, AND EXCEPT THAT  AN  ESTATE  OR  TRUST  SHALL  BE
DEEMED  TO HAVE NET EARNINGS FROM SELF-EMPLOYMENT DETERMINED IN THE SAME
MANNER AS IF IT WERE AN INDIVIDUAL SUBJECT TO THE TAX ON SELF-EMPLOYMENT
INCOME IMPOSED BY SECTION FOURTEEN HUNDRED ONE OF THE  INTERNAL  REVENUE
CODE DIMINISHED BY (1) THE AMOUNT OF ANY DEDUCTION ALLOWED BY SUBSECTION
(C)  OF  SECTION  SIX HUNDRED FORTY-TWO OF THE INTERNAL REVENUE CODE AND
(2) THE DEDUCTIONS ALLOWED BY SECTIONS SIX  HUNDRED  FIFTY-ONE  AND  SIX
HUNDRED  SIXTY-ONE  OF  SAID  CODE  TO  THE  EXTENT  THAT THEY REPRESENT
DISTRIBUTIONS OR PAYMENTS TO A RESIDENT OF THE CITY. HOWEVER, "TRADE  OR
BUSINESS"  AS  USED IN SUBSECTION (A) OF SECTION FOURTEEN HUNDRED TWO OF
SUCH CODE SHALL MEAN THE  SAME  AS  TRADE  OR  BUSINESS  AS  DEFINED  IN
SUBSECTION (C) OF SECTION FOURTEEN HUNDRED TWO OF SUCH CODE, EXCEPT THAT
PARAGRAPHS (4), (5) AND (6) OF SUCH SUBSECTION SHALL NOT APPLY IN DETER-
MINING  NET  EARNINGS FROM SELF-EMPLOYMENT TAXABLE UNDER THIS LOCAL LAW.
PROVIDED HOWEVER, IN THE CASE OF A NONRESIDENT INDIVIDUAL OR PARTNER  OF
A PARTNERSHIP DOING AN INSURANCE BUSINESS DESCRIBED IN SECTION SIX THOU-
SAND  TWO  HUNDRED  ONE  OF THE INSURANCE LAW, ANY ITEM OF INCOME, GAIN,
LOSS OR DEDUCTION OF SUCH BUSINESS WHICH IS THE  INDIVIDUAL'S  DISTRIBU-
TIVE  OR  PRO  RATA  SHARE  FOR FEDERAL INCOME TAX PURPOSES OR WHICH THE
INDIVIDUAL IS REQUIRED TO  TAKE  INTO  ACCOUNT  SEPARATELY  FOR  FEDERAL
INCOME  TAX  PURPOSES  SHALL  NOT BE CONSIDERED TO BE "NET EARNINGS FROM
SELF-EMPLOYMENT".
  (F) "TAXABLE YEAR" SHALL MEAN THE TAXPAYER'S TAXABLE YEAR FOR  FEDERAL
INCOME TAX PURPOSES.
  (G) "RESIDENT INDIVIDUAL" SHALL MEAN AN INDIVIDUAL:
  (1)  WHO  IS  DOMICILED IN THE CITY, UNLESS (A) HE OR SHE MAINTAINS NO
PERMANENT PLACE OF ABODE IN THE CITY, MAINTAINS  A  PERMANENT  PLACE  OF
ABODE  ELSEWHERE,  AND SPENDS IN THE AGGREGATE NOT MORE THAN THIRTY DAYS
OF THE TAXABLE YEAR IN THE CITY, OR (B) (I) WITHIN ANY  PERIOD  OF  FIVE
HUNDRED  FORTY-EIGHT  CONSECUTIVE DAYS HE OR SHE IS PRESENT IN A FOREIGN
COUNTRY OR COUNTRIES FOR AT LEAST FOUR  HUNDRED  FIFTY  DAYS,  AND  (II)
DURING  SUCH  PERIOD  OF FIVE HUNDRED FORTY-EIGHT CONSECUTIVE DAYS HE OR
SHE IS NOT PRESENT IN THE CITY FOR MORE THAN NINETY DAYS  AND  DOES  NOT
MAINTAIN  A  PERMANENT  PLACE  OF  ABODE IN THE CITY AT WHICH HIS OR HER
SPOUSE (UNLESS SUCH SPOUSE IS LEGALLY SEPARATED) OR MINOR  CHILDREN  ARE
PRESENT  FOR  MORE THAN NINETY DAYS, AND (III) DURING ANY PERIOD OF LESS
THAN TWELVE MONTHS, WHICH WOULD BE TREATED AS A SEPARATE TAXABLE  PERIOD
BASED  ON  A  CHANGE  OF  RESIDENT STATUS, AND WHICH PERIOD IS CONTAINED
WITHIN SUCH PERIOD OF FIVE HUNDRED FORTY-EIGHT CONSECUTIVE DAYS,  HE  OR
SHE IS PRESENT IN THE CITY FOR A NUMBER OF DAYS WHICH DOES NOT EXCEED AN
AMOUNT  WHICH  BEARS  THE  SAME  RATIO  TO  NINETY AS THE NUMBER OF DAYS
CONTAINED IN SUCH PERIOD OF  LESS  THAN  TWELVE  MONTHS  BEARS  TO  FIVE
HUNDRED FORTY-EIGHT, OR
  (2)  WHO  IS NOT DOMICILED IN THE CITY BUT MAINTAINS A PERMANENT PLACE
OF ABODE IN THE CITY AND SPENDS IN THE AGGREGATE MORE THAN  ONE  HUNDRED
EIGHTY-THREE  DAYS OF THE TAXABLE YEAR IN THE CITY, UNLESS SUCH INDIVID-
UAL IS IN ACTIVE SERVICE IN THE ARMED FORCES OF THE UNITED STATES.

S. 3645                             4

  (H) "NONRESIDENT INDIVIDUAL" SHALL MEAN AN INDIVIDUAL  WHO  IS  NOT  A
RESIDENT.
  (I) "RESIDENT ESTATE OR TRUST" SHALL MEAN:
  (1)  THE ESTATE OF A DECEDENT WHO AT HIS OR HER DEATH WAS DOMICILED IN
THE CITY,
  (2) A TRUST, OR A PORTION OF A TRUST, CONSISTING  OF  PROPERTY  TRANS-
FERRED  BY  WILL  OF A DECEDENT WHO AT HIS OR HER DEATH WAS DOMICILED IN
THE CITY, OR
  (3) A TRUST, OR PORTION OF A TRUST, CONSISTING OF THE PROPERTY OF:
  (A) A PERSON DOMICILED IN THE CITY  AT  THE  TIME  SUCH  PROPERTY  WAS
TRANSFERRED  TO  THE TRUST, IF SUCH TRUST OR PORTION OF A TRUST WAS THEN
IRREVOCABLE, OR IF IT WAS THEN REVOCABLE AND HAS NOT SUBSEQUENTLY BECOME
IRREVOCABLE; OR
  (B) A PERSON DOMICILED IN THE CITY AT THE TIME SUCH TRUST, OR  PORTION
OF  A  TRUST, BECAME IRREVOCABLE, IF IT WAS REVOCABLE WHEN SUCH PROPERTY
WAS TRANSFERRED TO THE TRUST BUT HAS SUBSEQUENTLY BECOME IRREVOCABLE.
  FOR THE PURPOSES OF THE FOREGOING, A TRUST OR PORTION OF  A  TRUST  IS
REVOCABLE IF IT IS SUBJECT TO A POWER, EXERCISABLE IMMEDIATELY OR AT ANY
FUTURE  TIME,  TO  REVEST TITLE IN THE PERSON WHOSE PROPERTY CONSTITUTES
SUCH TRUST OR PORTION OF A TRUST, AND A TRUST  OR  PORTION  OF  A  TRUST
BECOMES  IRREVOCABLE  WHEN  THE POSSIBILITY THAT SUCH POWER MAY BE EXER-
CISED HAS BEEN TERMINATED.
  (J) "NONRESIDENT ESTATE OR TRUST" SHALL MEAN AN ESTATE OR TRUST  WHICH
IS NOT A RESIDENT.
  (K)  UNLESS  A DIFFERENT MEANING IS CLEARLY REQUIRED, ANY TERM USED IN
THIS LOCAL LAW SHALL HAVE THE SAME MEANING AS WHEN USED IN A  COMPARABLE
CONTEXT  IN  THE LAWS OF THE UNITED STATES RELATING TO FEDERAL TAXES BUT
SUCH MEANING  SHALL  BE  SUBJECT  TO  THE  EXEMPTIONS  OR  MODIFICATIONS
PRESCRIBED IN OR PURSUANT TO ARTICLE TWO-E OF THE GENERAL CITY LAW OR BY
THE  LAWS OF THIS STATE. ANY REFERENCE IN THIS LOCAL LAW TO THE INTERNAL
REVENUE CODE, THE INTERNAL REVENUE CODE OF NINETEEN  HUNDRED  EIGHTY-SIX
OR  TO  THE  LAWS  OF THE UNITED STATES SHALL MEAN THE PROVISIONS OF THE
INTERNAL REVENUE CODE OF NINETEEN HUNDRED EIGHTY-SIX (UNLESS A REFERENCE
TO THE INTERNAL REVENUE CODE OF NINETEEN HUNDRED FIFTY-FOUR  IS  CLEARLY
INTENDED),  AND  AMENDMENTS THERETO, AND OTHER PROVISIONS OF THE LAWS OF
THE UNITED STATES RELATING TO FEDERAL TAXES, AS THE SAME ARE INCLUDED IN
THIS LOCAL LAW AS AN APPENDIX AND  SUPPLEMENT  TO  THE  APPENDIX  OR  AS
INCLUDED BY REFERENCE TO AN APPENDIX AND SUPPLEMENT TO THE APPENDIX OF A
TITLE  ENACTED  BY  THE  SAME  LOCAL  LAW AS ENACTS THIS LOCAL LAW. (THE
QUOTATION OF THE AFORESAID LAWS OF THE UNITED STATES IS INTENDED TO MAKE
THEM A PART OF THIS LOCAL LAW AND TO AVOID CONSTITUTIONAL  UNCERTAINTIES
WHICH  MIGHT  RESULT IF SUCH LAWS WERE MERELY INCORPORATED BY REFERENCE.
THE QUOTATION OF A PROVISION OF THE FEDERAL INTERNAL REVENUE CODE OR  OF
ANY OTHER LAW OF THE UNITED STATES SHALL NOT NECESSARILY MEAN THAT IT IS
APPLICABLE TO OR HAS RELEVANCE TO THIS LOCAL LAW.)
  S  2.  PERSONS  SUBJECT TO TAX. (A) IMPOSITION OF TAX. A TAX IS HEREBY
IMPOSED FOR EACH TAXABLE YEAR BEGINNING ON OR AFTER JANUARY  FIRST,  TWO
THOUSAND  NINE  ON  THE WAGES EARNED, AND NET EARNINGS FROM SELF-EMPLOY-
MENT, WITHIN THE CITY, OF EVERY NONRESIDENT INDIVIDUAL, ESTATE AND TRUST
WHICH SHALL COMPRISE:
  (1) A TAX AT THE RATE OF ONE-FOURTH OF ONE PERCENT ON ALL WAGES.
  (2) A TAX AT THE RATE OF THREE-EIGHTHS OF ONE PERCENT ON ALL NET EARN-
INGS FROM SELF-EMPLOYMENT.
  (B) EXCLUSION. (1) IN COMPUTING THE AMOUNT OF WAGES AND  NET  EARNINGS
FROM  SELF-EMPLOYMENT  TAXABLE  UNDER  SUBDIVISION  (A),  THERE SHALL BE

S. 3645                             5

ALLOWED AN EXCLUSION AGAINST THE TOTAL OF WAGES AND  NET  EARNINGS  FROM
SELF-EMPLOYMENT IN ACCORDANCE WITH THE FOLLOWING TABLE:
  TOTAL OF WAGES AND NET EARNINGS
      FROM SELF-EMPLOYMENT                 EXCLUSION ALLOWABLE
                   NOT OVER $10,000               $3,000
  OVER $10,000 BUT NOT OVER $20,000               $2,000
  OVER $20,000 BUT NOT OVER $30,000               $1,000
  OVER $30,000                                      NONE
  (2)  THE  EXCLUSION  ALLOWABLE SHALL BE APPLIED PRO RATA AGAINST WAGES
AND NET EARNINGS FROM SELF-EMPLOYMENT.
  (3) FOR TAXABLE PERIODS OF LESS THAN ONE YEAR, THE EXCLUSION ALLOWABLE
SHALL BE PRORATED PURSUANT TO REGULATIONS OF THE ADMINISTRATOR.
  (C) LIMITATION. IN NO EVENT SHALL A TAXPAYER BE  SUBJECT  TO  THE  TAX
UNDER  THIS  LOCAL  LAW  IN  AN  AMOUNT  GREATER THAN HE OR SHE WOULD BE
REQUIRED TO PAY IF HE OR SHE WERE A RESIDENT OF THE CITY AND SUBJECT  TO
A  TAX  ON  PERSONAL INCOME OF RESIDENTS OF THE CITY ADOPTED BY THE CITY
PURSUANT TO AUTHORITY GRANTED BY THE GENERAL CITY LAW.
  S 3. PERSONS SUBJECT TO TAX. (A) IMPOSITION OF TAX. (1) A TAX IS HERE-
BY IMPOSED FOR EACH TAXABLE YEAR BEGINNING AFTER DECEMBER  THIRTY-FIRST,
TWO  THOUSAND  EIGHT ON THE WAGES EARNED, AND NET EARNINGS FROM SELF-EM-
PLOYMENT, WITHIN THE CITY, OF EVERY NONRESIDENT INDIVIDUAL,  ESTATE  AND
TRUST WHICH SHALL COMPRISE:
  (I) A TAX AT THE RATE OF ONE-FOURTH OF ONE PERCENT ON ALL WAGES.
  (II)  A  TAX  AT  THE  RATE OF THREE-EIGHTHS OF ONE PERCENT ON ALL NET
EARNINGS FROM SELF-EMPLOYMENT.
  (2) FOR EACH TAXABLE YEAR BEGINNING ON OR  AFTER  JANUARY  FIRST,  TWO
THOUSAND  NINE,  A  TAX  IS  HEREBY IMPOSED ON THE WAGES EARNED, AND NET
EARNINGS FROM SELF-EMPLOYMENT, WITHIN THE  CITY,  OF  EVERY  NONRESIDENT
INDIVIDUAL, ESTATE AND TRUST WHICH SHALL COMPRISE:
  (I)  A  TAX AT THE RATE OF FORTY-FIVE HUNDREDTHS OF ONE PERCENT ON ALL
WAGES.
  (II) A TAX AT THE RATE OF SIXTY-FIVE HUNDREDTHS OF ONE PERCENT ON  ALL
NET EARNINGS FROM SELF-EMPLOYMENT.
  (B)  EXCLUSION.  (1) IN COMPUTING THE AMOUNT OF WAGES AND NET EARNINGS
FROM SELF-EMPLOYMENT TAXABLE  UNDER  SUBDIVISION  (A),  THERE  SHALL  BE
ALLOWED  AN  EXCLUSION  AGAINST THE TOTAL OF WAGES AND NET EARNINGS FROM
SELF-EMPLOYMENT IN ACCORDANCE WITH THE FOLLOWING TABLE:
  TOTAL OF WAGES AND NET EARNINGS
      FROM SELF-EMPLOYMENT             EXCLUSION ALLOWABLE
                  NOT OVER $10,000           $3,000
  OVER $10,000 BUT NOT OVER $20,000           $2,000
  OVER $20,000 BUT NOT OVER $30,000           $1,000
  OVER $30,000                                NONE
  (2) THE EXCLUSION ALLOWABLE SHALL BE APPLIED PRO  RATA  AGAINST  WAGES
AND NET EARNINGS FROM SELF-EMPLOYMENT.
  (3) FOR TAXABLE PERIODS OF LESS THAN ONE YEAR, THE EXCLUSION ALLOWABLE
SHALL BE PRORATED PURSUANT TO REGULATIONS OF THE ADMINISTRATOR.
  (C)  LIMITATION.  IN  NO  EVENT SHALL A TAXPAYER BE SUBJECT TO THE TAX
UNDER THIS LOCAL LAW IN AN AMOUNT  GREATER  THAN  HE  OR  SHE  WOULD  BE
REQUIRED  TO PAY IF HE OR SHE WERE A RESIDENT OF THE CITY AND SUBJECT TO
A TAX ON PERSONAL INCOME OF RESIDENTS OF THE CITY ADOPTED  BY  THE  CITY
PURSUANT TO AUTHORITY GRANTED BY THE GENERAL CITY LAW OR THE TAX LAW.
  S  4.  ALLOCATION  TO  THE  CITY.  (A)  GENERAL.  IF NET EARNINGS FROM
SELF-EMPLOYMENT ARE DERIVED FROM SERVICES PERFORMED,  OR  FROM  SOURCES,
WITHIN AND WITHOUT THE CITY, THERE SHALL BE ALLOCATED TO THE CITY A FAIR
AND EQUITABLE PORTION OF SUCH EARNINGS.

S. 3645                             6

  (B) ALLOCATION OF NET EARNINGS FROM SELF-EMPLOYMENT.
  (1)  PLACE OF BUSINESS. IF A TAXPAYER HAS NO REGULAR PLACE OF BUSINESS
OUTSIDE THE CITY ALL OF HIS OR HER  NET  EARNINGS  FROM  SELF-EMPLOYMENT
SHALL BE ALLOCATED TO THE CITY.
  (2)  ALLOCATION  BY TAXPAYER'S BOOKS. THE PORTION OF NET EARNINGS FROM
SELF-EMPLOYMENT ALLOCABLE TO THE CITY MAY BE DETERMINED FROM  THE  BOOKS
AND  RECORDS  OF  A TAXPAYER'S TRADE OR BUSINESS, IF THE METHODS USED IN
KEEPING SUCH BOOKS AND THE ACCURACY THEREOF ARE APPROVED BY THE ADMINIS-
TRATOR AS FAIRLY AND EQUITABLY REFLECTING NET EARNINGS FROM SELF-EMPLOY-
MENT WITHIN THE CITY.
  (3) ALLOCATION BY FORMULA. IF PARAGRAPH (2)  DOES  NOT  APPLY  TO  THE
TAXPAYER,  THE PORTION OF NET EARNINGS FROM SELF-EMPLOYMENT ALLOCABLE TO
THE CITY SHALL BE DETERMINED BY MULTIPLYING (A) NET EARNINGS FROM  SELF-
EMPLOYMENT  WITHIN  AND  WITHOUT  THE  CITY,  BY  (B) THE AVERAGE OF THE
FOLLOWING THREE PERCENTAGES:
  (I) PROPERTY PERCENTAGE. THE PERCENTAGE COMPUTED BY DIVIDING  (A)  THE
AVERAGE  OF  THE VALUE, AT THE BEGINNING AND END OF THE TAXABLE YEAR, OF
REAL AND TANGIBLE PERSONAL PROPERTY CONNECTED WITH THE NET EARNINGS FROM
SELF-EMPLOYMENT AND LOCATED WITHIN THE CITY, BY (B) THE AVERAGE  OF  THE
VALUE,  AT  THE  BEGINNING  AND END OF THE TAXABLE YEAR, OF ALL REAL AND
TANGIBLE PERSONAL PROPERTY CONNECTED WITH THE NET EARNINGS FROM SELF-EM-
PLOYMENT AND LOCATED BOTH WITHIN AND WITHOUT THE CITY. FOR THIS PURPOSE,
REAL PROPERTY SHALL INCLUDE REAL PROPERTY, WHETHER OWNED OR RENTED.
  (II) PAYROLL PERCENTAGE. THE PERCENTAGE COMPUTED BY DIVIDING  (A)  THE
TOTAL  WAGES,  SALARIES  AND OTHER PERSONAL SERVICE COMPENSATION PAID OR
INCURRED DURING THE TAXABLE YEAR TO EMPLOYEES IN CONNECTION WITH THE NET
EARNINGS FROM SELF-EMPLOYMENT DERIVED FROM A TRADE OR  BUSINESS  CARRIED
ON  WITHIN  THE  CITY, BY (B) THE TOTAL OF ALL WAGES, SALARIES AND OTHER
PERSONAL SERVICE COMPENSATION PAID OR INCURRED DURING THE  TAXABLE  YEAR
TO  EMPLOYEES  IN  CONNECTION WITH THE NET EARNINGS FROM SELF-EMPLOYMENT
DERIVED FROM A TRADE OR BUSINESS CARRIED ON BOTH WITHIN AND WITHOUT  THE
CITY.
  (III) GROSS INCOME PERCENTAGE. THE PERCENTAGE COMPUTED BY DIVIDING (A)
THE GROSS SALES OR CHARGES FOR SERVICES PERFORMED BY OR THROUGH AN AGEN-
CY  LOCATED  WITHIN  THE  CITY,  BY  (B) THE TOTAL OF ALL GROSS SALES OR
CHARGES FOR SERVICES PERFORMED WITHIN AND WITHOUT THE CITY. THE SALES OR
CHARGES TO BE ALLOCATED TO THE CITY SHALL INCLUDE ALL  SALES  NEGOTIATED
OR  CONSUMMATED,  AND  CHARGES  FOR  SERVICES PERFORMED, BY AN EMPLOYEE,
AGENT, AGENCY OR INDEPENDENT CONTRACTOR CHIEFLY SITUATED  AT,  CONNECTED
BY  CONTRACT OR OTHERWISE WITH, OR SENT OUT FROM, OFFICES OR OTHER AGEN-
CIES OF THE TRADE OR BUSINESS FROM WHICH  A  TAXPAYER  IS  DERIVING  NET
EARNINGS FROM SELF-EMPLOYMENT, SITUATED WITHIN THE CITY.
  (C)  OTHER  ALLOCATION  METHODS.  THE  PORTION  OF  NET  EARNINGS FROM
SELF-EMPLOYMENT ALLOCABLE TO THE CITY SHALL BE DETERMINED IN  ACCORDANCE
WITH  RULES  AND  REGULATIONS OF THE ADMINISTRATOR IF IT SHALL APPEAR TO
THE ADMINISTRATOR THAT THE NET EARNINGS  FROM  SELF-EMPLOYMENT  ARE  NOT
FAIRLY AND EQUITABLY REFLECTED UNDER THE PROVISIONS OF SUBDIVISION (B).
  (D)  SPECIAL  RULES  FOR  REAL  ESTATE. INCOME AND DEDUCTIONS FROM THE
RENTAL OF REAL PROPERTY AND GAIN AND LOSS FROM  THE  SALE,  EXCHANGE  OR
OTHER  DISPOSITION  OF REAL PROPERTY, SHALL NOT BE SUBJECT TO ALLOCATION
UNDER SUBDIVISION (B) OR  (C),  BUT  SHALL  BE  CONSIDERED  AS  ENTIRELY
DERIVED  FROM  OR  CONNECTED  WITH  THE  PLACE IN WHICH SUCH PROPERTY IS
LOCATED.
  S 5. ACCOUNTING PERIODS AND METHODS. (A) ACCOUNTING PERIODS. A TAXPAY-
ER'S TAXABLE YEAR UNDER THIS LOCAL LAW SHALL BE THE SAME AS HIS  OR  HER
TAXABLE YEAR FOR FEDERAL INCOME TAX PURPOSES.

S. 3645                             7

  (B)  CHANGE  OF  ACCOUNTING  PERIODS.  IF A TAXPAYER'S TAXABLE YEAR IS
CHANGED FOR FEDERAL INCOME TAX PURPOSES, HIS OR  HER  TAXABLE  YEAR  FOR
PURPOSES  OF  THIS  LOCAL  LAW  SHALL BE SIMILARLY CHANGED. IF A TAXABLE
PERIOD OF LESS THAN TWELVE MONTHS RESULTS FROM A CHANGE OF TAXABLE YEAR,
THE  EXCLUSION  ALLOWABLE  UNDER  SECTION TWO OR THREE OF THIS LOCAL LAW
SHALL BE PRORATED UNDER REGULATIONS OF THE ADMINISTRATOR.
  (C) ACCOUNTING METHODS. A TAXPAYER'S METHOD OF ACCOUNTING  UNDER  THIS
PART  SHALL  BE  THE SAME AS HIS OR HER METHOD OF ACCOUNTING FOR FEDERAL
INCOME TAX PURPOSES. IN THE ABSENCE OF  ANY  METHOD  OF  ACCOUNTING  FOR
FEDERAL  INCOME  TAX  PURPOSES, NET EARNINGS FROM SELF-EMPLOYMENT WITHIN
THE CITY SHALL BE COMPUTED UNDER SUCH METHOD AS IN THE  OPINION  OF  THE
ADMINISTRATOR  CLEARLY REFLECTS NET EARNINGS FROM SELF-EMPLOYMENT WITHIN
THE CITY.
  (D) CHANGE OF ACCOUNTING METHODS.
  (1) IF A TAXPAYER'S METHOD OF ACCOUNTING IS CHANGED FOR FEDERAL INCOME
TAX PURPOSES, HIS OR HER METHOD OF ACCOUNTING FOR PURPOSES OF THIS LOCAL
LAW SHALL BE SIMILARLY CHANGED.
  (2) IF A TAXPAYER'S METHOD OF ACCOUNTING IS CHANGED, OTHER  THAN  FROM
AN  ACCRUAL  TO  AN INSTALLMENT METHOD, ANY ADDITIONAL TAX WHICH RESULTS
FROM ADJUSTMENTS DETERMINED TO BE NECESSARY  SOLELY  BY  REASON  OF  THE
CHANGE  SHALL NOT BE GREATER THAN IF SUCH ADJUSTMENTS WERE RATABLY ALLO-
CATED AND INCLUDED FOR THE TAXABLE YEAR OF THE CHANGE AND THE  PRECEDING
TAXABLE  YEARS, BEGINNING AFTER JANUARY FIRST, TWO THOUSAND NINE, NOT IN
EXCESS OF TWO, DURING WHICH THE TAXPAYER USED THE METHOD  OF  ACCOUNTING
FROM WHICH THE CHANGE IS MADE.
  (3) IF A TAXPAYER'S METHOD OF ACCOUNTING IS CHANGED FROM AN ACCRUAL TO
AN INSTALLMENT METHOD, ANY ADDITIONAL TAX FOR THE YEAR OF SUCH CHANGE OF
METHOD  AND FOR ANY SUBSEQUENT YEAR WHICH IS ATTRIBUTABLE TO THE RECEIPT
OF INSTALLMENT PAYMENTS PROPERLY ACCRUED  IN  A  PRIOR  YEAR,  SHALL  BE
REDUCED BY THE PORTION OF TAX FOR ANY PRIOR TAXABLE YEAR ATTRIBUTABLE TO
THE ACCRUAL OF SUCH INSTALLMENT PAYMENTS, IN ACCORDANCE WITH REGULATIONS
OF THE ADMINISTRATOR.
  S 6. WITHHOLDING OF TAX ON WAGES. ON OR AFTER THE FIRST PAYROLL PERIOD
BEGINNING  FORTY-FIVE  DAYS AFTER THE DATE THIS LOCAL LAW BECOMES EFFEC-
TIVE EVERY EMPLOYER MAINTAINING AN OFFICE OR TRANSACTING BUSINESS WITHIN
THIS STATE AND MAKING PAYMENT OF ANY WAGES TAXABLE UNDER THIS LOCAL  LAW
SHALL  DEDUCT AND WITHHOLD FROM SUCH WAGES FOR EACH PAYROLL PERIOD A TAX
COMPUTED IN SUCH MANNER AS TO RESULT, SO FAR AS  PRACTICABLE,  IN  WITH-
HOLDING  FROM  THE  EMPLOYEE'S WAGES DURING EACH CALENDAR YEAR AN AMOUNT
SUBSTANTIALLY EQUIVALENT TO THE TAX REASONABLY ESTIMATED TO BE DUE  FROM
THE  EMPLOYEE UNDER THIS LOCAL LAW. THE METHOD OF DETERMINING THE AMOUNT
TO BE WITHHELD SHALL BE PRESCRIBED BY REGULATIONS OF THE ADMINISTRATOR.
  S 7. WITHHOLDING OF TAX ON WAGES FOR TAXABLE PERIODS COMMENCING ON  OR
AFTER JANUARY FIRST, TWO THOUSAND NINE. THE PROVISIONS CONTAINED IN THIS
SECTION  AND  SECTIONS  SEVEN, NINE, TEN, ELEVEN, TWELVE AND THIRTEEN OF
THIS LOCAL LAW SHALL NOT BE APPLICABLE  TO  TAXES  IMPOSED  FOR  TAXABLE
PERIODS COMMENCING ON OR AFTER JANUARY FIRST, TWO THOUSAND NINE PROVIDED
HOWEVER,  WITH RESPECT TO SUCH PERIODS, THE PROVISIONS CONTAINED IN PART
V OF ARTICLE TWENTY-TWO OF THE TAX LAW SHALL BE APPLICABLE WITH THE SAME
FORCE AND EFFECT AS IF THOSE PROVISIONS HAD BEEN INCORPORATED IN FULL IN
THIS SUBSECTION EXCEPT WHERE INCONSISTENT WITH THE  PROVISIONS  OF  THIS
ARTICLE, EXCEPT THAT THE TERM "AGGREGATE AMOUNT" CONTAINED IN PARAGRAPHS
ONE,  TWO, THREE, FOUR AND FIVE OF SUBSECTION (A) OF SECTION SIX HUNDRED
SEVENTY-FOUR OF THE TAX LAW SHALL MEAN THE AGGREGATE  OF  THE  AGGREGATE
AMOUNTS  OF  NEW  YORK  STATE  PERSONAL INCOME TAX, CITY EARNINGS TAX ON
NONRESIDENTS AND CITY PERSONAL INCOME TAX ON RESIDENTS AUTHORIZED PURSU-

S. 3645                             8

ANT TO ARTICLE THIRTY OF THE TAX LAW REQUIRED TO BE DEDUCTED  AND  WITH-
HELD AND PROVIDED, HOWEVER, THAT THE PROVISIONS OF SUCH PARAGRAPHS SHALL
NOT  BE  APPLICABLE  TO  EMPLOYER'S  RETURNS  REQUIRED  TO BE FILED WITH
RESPECT  TO TAXES REQUIRED TO BE DEDUCTED AND WITHHELD DURING THE CALEN-
DAR YEAR TWO THOUSAND NINE, BUT SUCH RETURNS SHALL  BE  REQUIRED  TO  BE
FILED  WITH  THE  STATE  TAX  COMMISSION  AT THE TIMES AND IN THE MANNER
PROVIDED FOR IN SUBDIVISION (A) OF SECTION TEN OF THIS LOCAL LAW, EXCEPT
THE TERM "ADMINISTRATOR" IN SUCH SUBDIVISION SHALL BE READ AS "STATE TAX
COMMISSION."
  S 8. INFORMATION STATEMENT FOR EMPLOYEE. EVERY  EMPLOYER  REQUIRED  TO
DEDUCT  AND  WITHHOLD  TAX  UNDER  THIS  LOCAL  LAW FROM THE WAGES OF AN
EMPLOYEE, SHALL FURNISH TO EACH SUCH EMPLOYEE IN RESPECT  OF  THE  WAGES
PAID  BY  SUCH  EMPLOYER TO SUCH EMPLOYEE DURING THE CALENDAR YEAR ON OR
BEFORE FEBRUARY FIFTEENTH OF THE SUCCEEDING YEAR,  OR,  IF  HIS  OR  HER
EMPLOYMENT  IS TERMINATED BEFORE THE CLOSE OF SUCH CALENDAR YEAR, WITHIN
THIRTY DAYS FROM THE DATE ON WHICH THE LAST  PAYMENT  OF  THE  WAGES  IS
MADE, A WRITTEN STATEMENT AS PRESCRIBED BY THE ADMINISTRATOR SHOWING THE
TOTAL  AMOUNT  OF WAGES PAID BY THE EMPLOYER TO THE EMPLOYEE, THE AMOUNT
OF WAGES PAID  FOR  SERVICES  PERFORMED  WITHIN  THE  CITY,  THE  AMOUNT
DEDUCTED AND WITHHELD AS TAX, AND SUCH OTHER INFORMATION AS THE ADMINIS-
TRATOR MAY PRESCRIBE.
  S  9.  CREDIT FOR TAX WITHHELD. WAGES UPON WHICH TAX IS REQUIRED TO BE
WITHHELD SHALL BE TAXABLE UNDER THIS LOCAL LAW AS IF NO WITHHOLDING WERE
REQUIRED, BUT ANY AMOUNT OF TAX ACTUALLY  DEDUCTED  AND  WITHHELD  UNDER
THIS LOCAL LAW IN ANY CALENDAR YEAR SHALL BE DEEMED TO HAVE BEEN PAID ON
BEHALF  OF  THE  EMPLOYEE FROM WHOM WITHHELD, AND SUCH EMPLOYEE SHALL BE
CREDITED WITH HAVING PAID THAT AMOUNT OF TAX IN SUCH CALENDAR YEAR.  FOR
A  TAXABLE  YEAR  OF  LESS  THAN TWELVE MONTHS, THE CREDIT SHALL BE MADE
UNDER REGULATIONS OF THE ADMINISTRATOR.
  S 10. EMPLOYER'S RETURN AND PAYMENT OF WITHHELD TAXES. (A) GENERAL. ON
OR AFTER THE FIRST PAYROLL PERIOD BEGINNING FORTY-FIVE  DAYS  AFTER  THE
EFFECTIVE  DATE OF THIS LOCAL LAW, EVERY EMPLOYER REQUIRED TO DEDUCT AND
WITHHOLD TAX UNDER THIS LOCAL LAW SHALL, FOR EACH CALENDAR MONTH, ON  OR
BEFORE THE FIFTEENTH DAY OF THE MONTH FOLLOWING THE CLOSE OF SUCH CALEN-
DAR  MONTH  FILE A WITHHOLDING RETURN AS PRESCRIBED BY THE ADMINISTRATOR
AND PAY OVER TO THE ADMINISTRATOR OR TO THE DEPOSITORY DESIGNATED BY THE
ADMINISTRATOR, THE TAXES SO REQUIRED TO BE DEDUCTED AND WITHHELD, EXCEPT
THAT FOR THE MONTH OF DECEMBER IN ANY YEAR THE RETURNS  SHALL  BE  FILED
AND  THE  TAXES PAID ON OR BEFORE JANUARY THIRTY-FIRST OF THE SUCCEEDING
YEAR. WHERE THE AGGREGATE AMOUNT REQUIRED TO BE DEDUCTED AND WITHHELD BY
ANY EMPLOYER UNDER THIS LOCAL LAW AND UNDER ANY LOCAL LAW IMPOSING A TAX
ON PERSONAL INCOME OF RESIDENTS OF THE CITY ADOPTED BY THE CITY PURSUANT
TO AUTHORITY GRANTED BY THE GENERAL CITY LAW IS  LESS  THAN  TWENTY-FIVE
DOLLARS  IN  A  CALENDAR  MONTH  AND THE AGGREGATE OF SUCH TAXES FOR THE
SEMI-ANNUAL PERIOD ENDING ON JUNE THIRTIETH  AND  DECEMBER  THIRTY-FIRST
CAN  REASONABLY  BE  EXPECTED TO BE LESS THAN ONE HUNDRED FIFTY DOLLARS,
THE ADMINISTRATOR MAY, BY REGULATION,  PERMIT  AN  EMPLOYER  TO  FILE  A
RETURN  ON OR BEFORE JULY THIRTY-FIRST FOR THE SEMI-ANNUAL PERIOD ENDING
ON JUNE THIRTIETH AND ON OR BEFORE JANUARY THIRTY-FIRST FOR THE SEMI-AN-
NUAL PERIOD ENDING ON DECEMBER THIRTY-FIRST. THE ADMINISTRATOR  MAY,  IF
HE  OR  SHE  BELIEVES  SUCH  ACTION  NECESSARY FOR THE PROTECTION OF THE
REVENUES, REQUIRE ANY EMPLOYER TO MAKE A RETURN AND PAY TO  HIM  OR  HER
THE  TAX  DEDUCTED AND WITHHELD AT ANY TIME, OR FROM TIME TO TIME. WHERE
THE AMOUNT OF WAGES PAID BY AN EMPLOYER IS  NOT  SUFFICIENT  UNDER  THIS
LOCAL  LAW  AND UNDER ANY LOCAL LAW IMPOSING A TAX ON PERSONAL INCOME OF
RESIDENTS OF THE CITY ADOPTED BY THE CITY PURSUANT TO AUTHORITY  GRANTED

S. 3645                             9

BY THE GENERAL CITY LAW TO REQUIRE THE WITHHOLDING OF TAX FROM THE WAGES
OF  ANY  OF  HIS OR HER EMPLOYEES, THE ADMINISTRATOR MAY, BY REGULATION,
PERMIT SUCH EMPLOYER TO FILE AN ANNUAL  RETURN  ON  OR  BEFORE  FEBRUARY
TWENTY-EIGHTH OF THE FOLLOWING CALENDAR YEAR.
  (B)  COMBINED RETURNS. THE ADMINISTRATOR MAY BY REGULATION PROVIDE FOR
THE FILING OF ONE RETURN WHICH SHALL INCLUDE THE RETURN REQUIRED  TO  BE
FILED  UNDER  THIS SECTION, TOGETHER WITH THE EMPLOYER'S RETURN REQUIRED
TO BE FILED UNDER ANY LOCAL LAW IMPOSING A TAX  ON  PERSONAL  INCOME  OF
RESIDENTS  OF THE CITY ADOPTED BY THE CITY PURSUANT TO AUTHORITY GRANTED
BY THE GENERAL CITY LAW.
  (C) DEPOSIT IN TRUST FOR CITY. WHENEVER ANY EMPLOYER FAILS TO COLLECT,
TRUTHFULLY ACCOUNT FOR, PAY OVER THE TAX, OR MAKE RETURNS OF THE TAX  AS
REQUIRED IN THIS SECTION, THE ADMINISTRATOR MAY SERVE A NOTICE REQUIRING
SUCH  EMPLOYER  TO  COLLECT  THE  TAXES  WHICH  BECOME COLLECTIBLE AFTER
SERVICE OF SUCH NOTICE, TO DEPOSIT SUCH TAXES IN A BANK APPROVED BY  THE
ADMINISTRATOR,  IN A SEPARATE ACCOUNT, IN TRUST FOR THE CITY AND PAYABLE
TO THE ADMINISTRATOR, AND TO KEEP THE AMOUNT OF SUCH TAX IN SUCH ACCOUNT
UNTIL PAYMENT OVER TO THE ADMINISTRATOR. SUCH  NOTICE  SHALL  REMAIN  IN
EFFECT UNTIL A NOTICE OF CANCELLATION IS SERVED BY THE ADMINISTRATOR.
  S 11. EMPLOYER'S LIABILITY FOR WITHHELD TAXES. EVERY EMPLOYER REQUIRED
TO  DEDUCT  AND  WITHHOLD  THE  TAX  UNDER THIS LOCAL LAW IS HEREBY MADE
LIABLE FOR SUCH TAX. FOR PURPOSES  OF  ASSESSMENT  AND  COLLECTION,  ANY
AMOUNT  REQUIRED  TO BE WITHHELD AND PAID OVER TO THE ADMINISTRATOR, AND
ANY ADDITIONS TO TAX, PENALTIES AND INTEREST WITH RESPECT THERETO  SHALL
BE  CONSIDERED  THE  TAX  OF  THE  EMPLOYER.  ANY AMOUNT OF TAX ACTUALLY
DEDUCTED AND WITHHELD UNDER THIS LOCAL LAW SHALL BE HELD TO BE A SPECIAL
FUND IN TRUST FOR THE CITY.
  NO EMPLOYEE SHALL HAVE ANY RIGHT OF ACTION AGAINST HIS OR HER EMPLOYER
IN RESPECT TO ANY MONIES DEDUCTED AND WITHHELD FROM HIS OR HER WAGES AND
PAID OVER TO THE ADMINISTRATOR IN COMPLIANCE OR IN  INTENDED  COMPLIANCE
WITH THIS LOCAL LAW.
  S  12.  EMPLOYER'S FAILURE TO WITHHOLD. IF AN EMPLOYER FAILS TO DEDUCT
AND WITHHOLD THE TAX, AS REQUIRED, AND THEREAFTER THE TAX AGAINST  WHICH
SUCH TAX MAY BE CREDITED IS PAID, THE TAX SO REQUIRED TO BE DEDUCTED AND
WITHHELD  SHALL  NOT  BE  COLLECTED  FROM THE EMPLOYER, BUT THE EMPLOYER
SHALL NOT BE RELIEVED FROM LIABILITY  FOR  ANY  PENALTIES,  INTEREST  OR
ADDITIONS  TO THE TAX OTHERWISE APPLICABLE IN RESPECT OF SUCH FAILURE TO
DEDUCT AND WITHHOLD.
  S 13. RETURNS AND PAYMENT OF TAX. ON OR BEFORE THE  FIFTEENTH  DAY  OF
THE  FOURTH  MONTH FOLLOWING THE CLOSE OF THE TAXABLE YEAR, EVERY PERSON
SUBJECT TO THE TAX SHALL MAKE AND FILE A RETURN AND ANY BALANCE  OF  THE
TAX  SHOWN  DUE  ON THE FACE OF SUCH RETURN SHALL BE PAID THEREWITH. THE
ADMINISTRATOR MAY, BY REGULATION, PROVIDE FOR THE FILING OF RETURNS  AND
PAYMENT  OF THE TAX AT SUCH OTHER TIMES AS HE OR SHE DEEMS NECESSARY FOR
THE PROPER ENFORCEMENT OF THIS LOCAL LAW.  THE  ADMINISTRATOR  MAY  ALSO
PROVIDE  BY REGULATION THAT ANY RETURN OTHERWISE REQUIRED TO BE MADE AND
FILED UNDER THIS LOCAL LAW BY ANY NONRESIDENT  INDIVIDUAL  NEED  NOT  BE
MADE  AND  FILED  IF SUCH NONRESIDENT INDIVIDUAL HAD, DURING THE TAXABLE
YEAR TO WHICH THE RETURN WOULD RELATE, NO NET EARNINGS FROM SELF-EMPLOY-
MENT WITHIN THE CITY. ANY REGULATION ALLOWING SUCH WAIVER OF RETURN  MAY
PROVIDE  FOR  ADDITIONAL LIMITATIONS ON AND CONDITIONS AND PREREQUISITES
TO THE PRIVILEGE OF NOT FILING A RETURN.
  S 14. COMBINED RETURNS, EMPLOYER'S RETURNS AND PAYMENTS. THE STATE TAX
COMMISSION MAY REQUIRE:
  (A) THE FILING OF ANY OR ALL OF THE FOLLOWING:

S. 3645                            10

  (1) A COMBINED RETURN WHICH IN ADDITION TO THE RETURN PROVIDED FOR  IN
A LOCAL LAW AUTHORIZED BY THIS ARTICLE MAY ALSO INCLUDE RETURNS REQUIRED
TO  BE  FILED  UNDER A LOCAL LAW AUTHORIZED BY ARTICLE THIRTY OF THE TAX
LAW AND UNDER ARTICLE TWENTY-TWO OF THE TAX LAW.
  (2)  A  COMBINED EMPLOYER'S RETURN WHICH IN ADDITION TO THE EMPLOYER'S
RETURN PROVIDED FOR IN A LOCAL LAW AUTHORIZED BY THIS ARTICLE  MAY  ALSO
INCLUDE  EMPLOYER'S  RETURNS  REQUIRED  TO  BE  FILED  UNDER A LOCAL LAW
AUTHORIZED BY ARTICLE THIRTY OF THE TAX LAW AND UNDER ARTICLE TWENTY-TWO
OF THE TAX LAW.
  (B) WHERE A COMBINED RETURN OR EMPLOYER'S RETURN IS REQUIRED, AND WITH
RESPECT TO THE PAYMENT OF ESTIMATED TAX, THE STATE  TAX  COMMISSION  MAY
ALSO  REQUIRE PAYMENT OF A SINGLE AMOUNT WHICH SHALL BE THE TOTAL OF THE
AMOUNTS (TOTAL TAXES LESS ANY CREDITS OR REFUNDS) REQUIRED  TO  BE  PAID
WITH  THE  RETURNS  OR EMPLOYER'S RETURNS OR IN PAYMENT OF ESTIMATED TAX
PURSUANT TO THE PROVISIONS OF LOCAL LAWS IMPOSED UNDER THE AUTHORITY  OF
ARTICLE TWO-E OF THE GENERAL CITY LAW, ARTICLE THIRTY OF THE TAX LAW AND
PURSUANT TO THE PROVISIONS OF ARTICLE TWENTY-TWO OF THE TAX LAW.
  S  15.  EFFECT OF INVALIDITY IN PART; INCONSISTENCIES WITH OTHER LAWS.
(A) IF ANY CLAUSE, SENTENCE, PARAGRAPH, SUBDIVISION, SECTION,  PROVISION
OR  OTHER  PORTION  OF  THIS LOCAL LAW OR THE APPLICATION THEREOF TO ANY
PERSON OR CIRCUMSTANCES SHALL BE HELD TO BE INVALID, SUCH HOLDING  SHALL
NOT  AFFECT, IMPAIR OR INVALIDATE THE REMAINDER OF THIS LOCAL LAW OR THE
APPLICATION OF SUCH PORTION HELD INVALID, TO ANY OTHER PERSON OR CIRCUM-
STANCES, BUT SHALL BE CONFINED IN ITS OPERATION TO THE CLAUSE, SENTENCE,
PARAGRAPH, SUBDIVISION, SECTION,  PROVISION  OR  OTHER  PORTION  THEREOF
DIRECTLY  INVOLVED  IN  SUCH  HOLDING OR TO THE PERSON AND CIRCUMSTANCES
THEREIN INVOLVED.
  (B) IF ANY PROVISION OF  THIS  LOCAL  LAW  IS  INCONSISTENT  WITH,  IN
CONFLICT WITH, OR CONTRARY TO ANY OTHER PROVISION OF LAW, SUCH PROVISION
OF THIS LOCAL LAW SHALL PREVAIL OVER SUCH OTHER PROVISION AND SUCH OTHER
PROVISION  SHALL  BE DEEMED TO HAVE BEEN AMENDED, SUPERSEDED OR REPEALED
TO THE EXTENT OF SUCH INCONSISTENCY, CONFLICT OR CONTRARIETY.
  S 25-N. ADMINISTRATIVE PROVISIONS. (A) GENERAL. ANY LOCAL LAW  ADOPTED
PURSUANT  TO  THIS  ARTICLE  SHALL ALSO CONTAIN PROVISIONS NECESSARY AND
APPROPRIATE FOR THE COLLECTION AND THE ADMINISTRATION OF THE TAX  HEREIN
AUTHORIZED, ANY LOCAL LAW ADOPTED PURSUANT TO THIS ARTICLE SHALL CONTAIN
THE SAME PROVISIONS AS ARE CONTAINED IN CHAPTER NINETEEN OF TITLE ELEVEN
OF  THE ADMINISTRATIVE CODE OF THE CITY OF NEW YORK, BUT "ADMINISTRATOR"
SHALL BE READ "STATE TAX COMMISSION"; "ADMINISTRATIVE  AGENCIES  OF  THE
CITY"  SHALL BE READ AS "ADMINISTRATIVE AGENCIES OF THE STATE"; "DEPOSI-
TORIES OR FINANCIAL AGENTS OF THE CITY" SHALL BE READ  AS  "DEPOSITORIES
OR FINANCIAL AGENTS OF THE STATE"; "OFFICERS OR EMPLOYEES OF THE DEPART-
MENT OF FINANCE OF THE CITY" SHALL BE READ "OFFICERS OR EMPLOYEES OF THE
STATE  DEPARTMENT OF TAXATION AND FINANCE"; IN SECTIONS 11-1934, 11-1936
AND 11-1942 OF SUCH CODE (EXCEPT FOR THE LAST SENTENCE  THEREOF)  "CITY"
SHALL  BE  READ  AS  "STATE";  "CORPORATION COUNSEL OR OTHER APPROPRIATE
OFFICER OF THE CITY" OR "CORPORATION COUNSEL OF THE CITY" SHALL BE  READ
AS  "STATE  ATTORNEY  GENERAL";  AND THE WORDS "IT" OR "ITS" SHALL APPLY
INSTEAD OF THE PRONOUNS USED WHERE THE REFERENCE IS TO STATE TAX COMMIS-
SION.
  (B) METHODS OF REVIEW. SUCH LOCAL LAW SHALL  ALSO  CONTAIN  PROVISIONS
SUBSTANTIALLY THE SAME AS THE FOLLOWING:
  (I) ANY FINAL DETERMINATION OF THE AMOUNT OF ANY TAX PAYABLE HEREUNDER
SHALL  BE REVIEWABLE FOR ERROR, ILLEGALITY OR UNCONSTITUTIONALITY OR ANY
OTHER REASON WHATSOEVER BY A PROCEEDING UNDER ARTICLE  SEVENTY-EIGHT  OF
THE  CIVIL PRACTICE LAW AND RULES IF APPLICATION THEREFOR IS MADE TO THE

S. 3645                            11

SUPREME COURT WITHIN FOUR MONTHS AFTER THE GIVING OF THE NOTICE OF  SUCH
FINAL  DETERMINATION,  PROVIDED, HOWEVER, THAT ANY SUCH PROCEEDING UNDER
ARTICLE SEVENTY-EIGHT OF THE CIVIL PRACTICE LAW AND RULES SHALL  NOT  BE
INSTITUTED  UNLESS (A) THE AMOUNT OF ANY TAX SOUGHT TO BE REVIEWED, WITH
SUCH INTEREST AND PENALTIES THEREON AS MAY BE PROVIDED FOR BY LOCAL  LAW
OR  REGULATION, SHALL BE FIRST DEPOSITED AND THERE IS FILED AN UNDERTAK-
ING, ISSUED BY A SURETY COMPANY AUTHORIZED TO TRANSACT BUSINESS IN  THIS
STATE  AND  APPROVED BY THE SUPERINTENDENT OF INSURANCE OF THIS STATE AS
TO SOLVENCY AND RESPONSIBILITY, IN SUCH  AMOUNT  AS  A  JUSTICE  OF  THE
SUPREME  COURT  SHALL  APPROVE  TO THE EFFECT THAT IF SUCH PROCEEDING BE
DISMISSED OR THE TAX CONFIRMED THE PETITIONER WILL  PAY  ALL  COSTS  AND
CHARGES WHICH MAY ACCRUE IN THE PROSECUTION OF SUCH PROCEEDING OR (B) AT
THE OPTION OF THE PETITIONER SUCH UNDERTAKING MAY BE IN A SUM SUFFICIENT
TO  COVER THE TAXES, INTEREST AND PENALTIES STATED IN SUCH DETERMINATION
PLUS THE COSTS AND CHARGES WHICH MAY ACCRUE AGAINST  IT  IN  THE  PROSE-
CUTION  OF  THE  PROCEEDING,  IN WHICH EVENT THE PETITIONER SHALL NOT BE
REQUIRED TO PAY SUCH TAXES, INTEREST OR PENALTIES AS A CONDITION  PRECE-
DENT TO THE APPLICATION.
  (II)  WHERE  ANY  TAX  IMPOSED  HEREUNDER SHALL HAVE BEEN ERRONEOUSLY,
ILLEGALLY OR UNCONSTITUTIONALLY COLLECTED AND APPLICATION FOR THE REFUND
THEREOF DULY MADE TO THE PROPER FISCAL OFFICER  OR  OFFICERS,  AND  SUCH
OFFICER OR OFFICERS SHALL HAVE MADE A DETERMINATION DENYING SUCH REFUND,
SUCH  DETERMINATION  SHALL  BE  REVIEWABLE BY A PROCEEDING UNDER ARTICLE
SEVENTY-EIGHT OF THE CIVIL PRACTICE LAW AND  RULES,  PROVIDED,  HOWEVER,
THAT  SUCH  PROCEEDING IS INSTITUTED WITHIN FOUR MONTHS AFTER THE GIVING
OF THE NOTICE OF SUCH DENIAL, THAT A FINAL DETERMINATION OF TAX DUE  WAS
NOT  PREVIOUSLY  MADE,  AND THAT AN UNDERTAKING IS FILED WITH THE PROPER
FISCAL OFFICER OR OFFICERS IN SUCH AMOUNT AND WITH SUCH  SURETIES  AS  A
JUSTICE  OF  THE  SUPREME COURT SHALL APPROVE TO THE EFFECT THAT IF SUCH
PROCEEDING BE DISMISSED OR THE TAX CONFIRMED, THE  PETITIONER  WILL  PAY
ALL  COSTS  AND  CHARGES  WHICH  MAY  ACCRUE  IN THE PROSECUTION OF SUCH
PROCEEDING.
  (III) NO ASSESSMENT OF ADDITIONAL TAX SHALL BE MADE AFTER THE  EXPIRA-
TION  OF MORE THAN THREE YEARS FROM THE DATE OF THE FILING OF THE RETURN
EXCEPT THAT WHERE NO RETURN HAS BEEN FILED OR, IN THE CASE OF THE FILING
OF A WILFULLY FALSE OR FRAUDULENT RETURN WITH INTENT TO EVADE  THE  TAX,
THE TAX MAY BE ASSESSED AT ANY TIME; PROVIDED, HOWEVER, WHERE A TAXPAYER
OMITS FROM HIS OR HER RETURN AN AMOUNT WHICH SHOULD BE PROPERLY INCLUDED
THEREIN  WHICH  IS IN EXCESS OF TWENTY-FIVE PERCENT OF THE AMOUNT OF THE
GROSS INCOME DERIVED BY HIM OR  HER  FROM  ANY  TRADE  OR  BUSINESS,  NO
ASSESSMENT  OF ADDITIONAL TAX SHALL BE MADE AFTER THE EXPIRATION OF MORE
THAN SIX YEARS FROM THE DATE OF THE FILING  OF  THE  RETURN,  EXCEPT  AS
OTHERWISE PROVIDED HEREIN.
  (C)  BULK  SALES. SUCH LOCAL LAW MAY CONTAIN A PROVISION SUBSTANTIALLY
THE SAME AS THE FOLLOWING:
  WHENEVER THERE IS MADE A SALE, TRANSFER OR ASSIGNMENT IN BULK  OF  ANY
PART  OR THE WHOLE OF A STOCK OF MERCHANDISE OR OF FIXTURES, OR MERCHAN-
DISE AND OF FIXTURES PERTAINING TO THE CONDUCTING OF THE BUSINESS OF THE
SELLER, TRANSFEROR OR ASSIGNOR, OTHERWISE THAN IN THE ORDINARY COURSE OF
TRADE AND IN THE REGULAR PROSECUTION OF SAID  BUSINESS,  THE  PURCHASER,
TRANSFEREE  OR ASSIGNEE SHALL AT LEAST TEN DAYS BEFORE TAKING POSSESSION
OF SUCH MERCHANDISE, FIXTURES, OR MERCHANDISE AND  FIXTURES,  OR  PAYING
THEREFOR,  NOTIFY  THE  ADMINISTRATOR BY REGISTERED MAIL OF THE PROPOSED
SALE AND OF THE PRICE, TERMS AND CONDITIONS THEREOF, WHETHER OR NOT  THE
SELLER,  TRANSFEROR  OR  ASSIGNOR,  HAS  REPRESENTED TO, OR INFORMED THE
PURCHASER, TRANSFEREE OR ASSIGNEE, THAT IT OWES ANY TAX PURSUANT TO THIS

S. 3645                            12

LOCAL LAW, WHETHER OR NOT THE  PURCHASER,  TRANSFEREE  OR  ASSIGNEE  HAS
KNOWLEDGE  THAT  SUCH TAXES ARE OWING, AND WHETHER OR NOT ANY SUCH TAXES
ARE IN FACT OWING.
  WHENEVER  THE PURCHASER, TRANSFEREE OR ASSIGNEE SHALL FAIL TO GIVE THE
NOTICE TO THE ADMINISTRATOR REQUIRED  BY  THE  PRECEDING  PARAGRAPH,  OR
WHENEVER  THE  ADMINISTRATOR  SHALL  INFORM THE PURCHASER, TRANSFEREE OR
ASSIGNEE THAT A POSSIBLE CLAIM FOR SUCH TAX OR TAXES EXISTS, ANY SUMS OF
MONEY, PROPERTY OR CHOSES IN ACTION, OR OTHER CONSIDERATION,  WHICH  THE
PURCHASER,  TRANSFEREE  OR  ASSIGNEE IS REQUIRED TO TRANSFER OVER TO THE
SELLER, TRANSFEROR OR ASSIGNOR SHALL BE  SUBJECT  TO  A  FIRST  PRIORITY
RIGHT  AND  LIEN FOR ANY SUCH TAXES THERETOFORE OR THEREAFTER DETERMINED
TO BE DUE FROM THE SELLER, TRANSFEROR OR ASSIGNOR TO THE CITY,  AND  THE
PURCHASER,  TRANSFEREE OR ASSIGNEE IS FORBIDDEN TO TRANSFER TO THE SELL-
ER, TRANSFEROR OR ASSIGNOR ANY SUCH SUMS OF MONEY, PROPERTY OR CHOSES IN
ACTION TO THE EXTENT OF THE AMOUNT OF THE CITY'S CLAIM. FOR  FAILURE  TO
COMPLY WITH THE PROVISIONS OF THIS SUBDIVISION THE PURCHASER, TRANSFEREE
OR  ASSIGNEE,  IN ADDITION TO BEING SUBJECT TO THE LIABILITIES AND REME-
DIES IMPOSED AS PROVIDED BY LAW, SHALL  BE  PERSONALLY  LIABLE  FOR  THE
PAYMENT  TO THE CITY OF ANY SUCH TAXES, THERETOFORE OR THEREAFTER DETER-
MINED TO BE DUE TO THE CITY FROM THE SELLER, TRANSFEROR OR ASSIGNOR  AND
SUCH  LIABILITY  MAY  BE ASSESSED AND ENFORCED IN THE SAME MANNER AS THE
LIABILITY FOR TAX IS IMPOSED UNDER THIS LOCAL LAW.
  (D) DELEGATION OF FUNCTIONS. THE LOCAL LAW MAY PROVIDE THAT THE ADMIN-
ISTRATOR OF THE TAX IMPOSED, AS DEFINED IN THE LOCAL LAW,  MAY  DELEGATE
HIS OR HER POWERS AND FUNCTIONS UNDER THE LOCAL LAW TO ONE OF HIS OR HER
DEPUTIES  OR  TO  ANY EMPLOYEE OR EMPLOYEES OF HIS OR HER DEPARTMENT AND
AUTHORIZE BANKS OR TRUST COMPANIES WHICH ARE DEPOSITORIES  OR  FINANCIAL
AGENTS  OF  THE  CITY  TO RECEIVE AND GIVE A RECEIPT FOR ANY TAX IMPOSED
UNDER THE LOCAL LAW.
  (E) THE PROVISIONS CONTAINED IN SUBDIVISIONS (A), (B), (C) AND (D)  OF
THIS  SECTION  SHALL NOT BE APPLICABLE WITH RESPECT TO TAXES IMPOSED FOR
TAXABLE PERIODS COMMENCING ON OR AFTER JANUARY FIRST, TWO THOUSAND  NINE
BUT,  WITH  RESPECT  TO  THE TAX IMPOSED FOR SUCH PERIODS THE PROVISIONS
CONTAINED IN PART VI OF ARTICLE TWENTY-TWO OF THE TAX  LAW  AND  SECTION
THIRTEEN HUNDRED ELEVEN OF THE TAX LAW INCLUDING THE PROVISIONS OF JUDI-
CIAL  REVIEW  BY  A  PROCEEDING UNDER ARTICLE SEVENTY-EIGHT OF THE CIVIL
PRACTICE LAW AND RULES SHALL BE  APPLICABLE  WITH  THE  SAME  FORCE  AND
EFFECT  AS  IF  THOSE  PROVISIONS  HAD BEEN INCORPORATED IN FULL IN THIS
SECTION EXCEPT WHERE INCONSISTENT WITH THE PROVISIONS OF THIS ARTICLE.
  S 25-O. DEPOSIT AND DISPOSITION OF REVENUES. REVENUES  RESULTING  FROM
THE  IMPOSITION  OF  THE TAX AUTHORIZED BY THIS ARTICLE SHALL BE PAID TO
THE METROPOLITAN TRANSPORTATION AUTHORITY TO BE APPLIED FIRST TO PAY ALL
TRIBOROUGH BRIDGE AND  TUNNEL  AUTHORITY  OPERATING  AND  CAPITAL  COSTS
RELATED  TO  THE  HARLEM AND EAST RIVER BRIDGES, AND ALL TAX REVENUES IN
EXCESS OF THAT AMOUNT ("SURPLUS TAX  REVENUES")  AS  DETERMINED  BY  THE
TRIBOROUGH  BRIDGE  AND  TUNNEL AUTHORITY. SUCH SURPLUS TAX REVENUES MAY
ONLY BE (A) USED FOR PAYMENT OF CAPITAL COSTS OF, AND/OR PLEDGED BY  THE
METROPOLITAN  TRANSPORTATION  AUTHORITY  TO SECURE AND BE APPLIED TO THE
PAYMENT OF THE BONDS, NOTES OR OTHER OBLIGATIONS OF THE AUTHORITY ISSUED
TO FINANCE CAPITAL PROJECTS OF SUCH AUTHORITY AND ITS  SUBSIDIARIES  AND
AFFILIATES,  INCLUDING, WITHOUT LIMITATION, CAPITAL PROJECTS RELATING TO
THE HARLEM AND EAST RIVER BRIDGES, AS SUCH  AUTHORITY  SHALL  DETERMINE,
INCLUDING  DEBT  SERVICE,  RESERVE  REQUIREMENTS, IF ANY, THE PAYMENT OF
AMOUNTS REQUIRED UNDER BOND AND NOTE FACILITIES  OR  AGREEMENTS  RELATED
THERETO,  THE  PAYMENT  OF  FEDERAL GOVERNMENT LOANS, SECURITY OR CREDIT
ARRANGEMENTS OR OTHER AGREEMENTS RELATED THERETO, AND THE PAYMENT OF ALL

S. 3645                            13

COSTS RELATED TO SUCH OBLIGATIONS, OR (B) OTHERWISE APPLIED TO THE OPER-
ATING COSTS OF THE METROPOLITAN TRANSPORTATION AUTHORITY AND ITS SUBSID-
IARIES AND AFFILIATES.
  S 4. This act shall take effect immediately.