S T A T E O F N E W Y O R K
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4149--A
2011-2012 Regular Sessions
I N A S S E M B L Y
February 1, 2011
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Introduced by M. of A. ENGLEBRIGHT, P. RIVERA, HEASTIE, ABBATE, CAHILL,
MAGNARELLI -- Multi-Sponsored by -- M. of A. ARROYO, BOYLAND, COLTON,
COOK, JACOBS, MARKEY, McENENY, PEOPLES-STOKES, PERRY, J. RIVERA,
SCHIMMINGER, SWEENEY, WEISENBERG -- read once and referred to the
Committee on Ways and Means -- recommitted to the Committee on Ways
and Means in accordance with Assembly Rule 3, sec. 2 -- committee
discharged, bill amended, ordered reprinted as amended and recommitted
to said committee
AN ACT to amend the tax law, in relation to exempting distributions from
individual retirement accounts and individual retirement annuities
from state personal income taxation when such distributions are used
to purchase long-term health care insurance
THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:
Section 1. Subsection (c) of section 612 of the tax law is amended by
adding a new paragraph 3-d to read as follows:
(3-D) DISTRIBUTIONS RECEIVED BY AN INDIVIDUAL, NOT OTHERWISE EXCLUDED
PURSUANT TO PARAGRAPH THREE OR THREE-A OF THIS SUBSECTION, TO THE EXTENT
INCLUDABLE IN GROSS INCOME FOR FEDERAL INCOME TAX PURPOSES, WHICH ARE
ATTRIBUTABLE TO PERSONAL SERVICES PERFORMED BY SUCH INDIVIDUAL FROM
EMPLOYMENT, WHICH ARISE (I) FROM AN EMPLOYER-EMPLOYEE RELATIONSHIP OR
(II) FROM CONTRIBUTIONS TO A RETIREMENT PLAN WHICH ARE DEDUCTIBLE FOR
FEDERAL INCOME TAX PURPOSES, TO THE EXTENT SUCH DISTRIBUTIONS ARE USED
DURING THE TAXABLE YEAR TO PURCHASE A POLICY OF LONG-TERM CARE INSUR-
ANCE, AS DEFINED IN SECTION ELEVEN HUNDRED SEVENTEEN OF THE INSURANCE
LAW, FOR SUCH INDIVIDUAL OR A DEPENDENT OF SUCH INDIVIDUAL. SUCH
DISTRIBUTIONS SHALL INCLUDE DISTRIBUTIONS FROM AN INDIVIDUAL RETIREMENT
ACCOUNT OR AN INDIVIDUAL RETIREMENT ANNUITY, AS DEFINED IN SECTION FOUR
HUNDRED EIGHT OF THE INTERNAL REVENUE CODE, AND DISTRIBUTIONS FROM
SELF-EMPLOYED INDIVIDUAL AND OWNER-EMPLOYEE RETIREMENT PLANS WHICH QUAL-
IFY UNDER SECTION FOUR HUNDRED ONE OF THE INTERNAL REVENUE CODE.
EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD01583-03-2
A. 4149--A 2
PROVIDED, HOWEVER, THAT ANY DISTRIBUTIONS EXCLUDED PURSUANT TO THIS
PARAGRAPH SHALL BE SUBTRACTED FROM THE TOTAL AMOUNT OF PREMIUMS PAID
WHEN COMPUTING THE AMOUNT OF ALLOWABLE CREDIT PURSUANT TO SUBSECTION
(AA) OF SECTION SIX HUNDRED SIX OF THIS ARTICLE.
S 2. Subsection (aa) of section 606 of the tax law, as amended by
section 1 of part P of chapter 61 of the laws of 2005, is amended to
read as follows:
(aa) Long-term care insurance credit. (1) Residents. 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 long-term
care insurance, PROVIDED THAT ANY AMOUNT SUBTRACTED FROM FEDERAL
ADJUSTED GROSS INCOME PURSUANT TO PARAGRAPH THREE-D OF SECTION SIX
HUNDRED TWELVE OF THIS ARTICLE SHALL BE SUBTRACTED FROM THE AMOUNT OF
PREMIUM PAID DURING THE TAXABLE YEAR AND THE TWENTY PERCENT CREDIT SHALL
BE BASED UPON SUCH RECOMPUTED AMOUNT OF PREMIUM PAID. In order to qual-
ify for such credit, the taxpayer's premium payment must be for the
purchase of or for continuing coverage under a long-term care insurance
policy that qualifies for such credit pursuant to section one thousand
one hundred seventeen of the insurance law. If the amount of the credit
allowable under this subsection for any taxable year shall exceed the
taxpayer's tax for such year, the excess may be carried over to the
following year or years and may be deducted from the taxpayer's tax for
such year or years.
(2) Nonresidents and part-year residents. In the case of a nonresident
taxpayer or a part-year resident taxpayer, the credit determined under
this subsection shall be limited to the amount determined by multiplying
the amount of such credit by the New York source fraction as set forth
in paragraph three of subsection (e) of section six hundred one of this
article. The credit as so limited shall be applied as provided in para-
graph one of this subsection, PROVIDED THAT ANY AMOUNT SUBTRACTED FROM
FEDERAL ADJUSTED GROSS INCOME PURSUANT TO PARAGRAPH THREE-D OF SECTION
SIX HUNDRED TWELVE OF THIS ARTICLE AND SECTION SIX HUNDRED THIRTY-ONE OF
THIS ARTICLE SHALL BE SUBTRACTED FROM THE AMOUNT OF PREMIUM PAID DURING
THE TAXABLE YEAR AND THE TWENTY PERCENT CREDIT SHALL BE BASED UPON SUCH
RECOMPUTED AMOUNT OF PREMIUM PAID.
S 3. This act shall take effect immediately and shall apply to taxable
years commencing on January first in the year in which this act shall
take effect and all subsequent taxable years.