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

                                  6344

                       2009-2010 Regular Sessions

                            I N  S E N A T E

                            December 16, 2009
                               ___________

Introduced  by  Sen.  KLEIN  -- read twice and ordered printed, and when
  printed to be committed to the Committee on Rules

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
  (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

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD07042-04-9
              

S. 6344                             2

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 is amended by adding a  new  clause  (xxxi)  to  read  as
follows:
(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:
  (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

S. 6344                             3

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.
  (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, 2011.