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

                                  6764

                       2011-2012 Regular Sessions

                          I N  A S S E M B L Y

                             March 28, 2011
                               ___________

Introduced by M. of A. WEPRIN -- read once and referred to the Committee
  on Ways and Means

AN  ACT  to  amend  the general city law and the tax 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.    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.
  THE  TAX  AUTHORIZED  BY  THIS ARTICLE MAY BE IMPOSED ONLY IF THE CITY
IMPOSING THE TAX AUTHORIZED BY THIS ARTICLE 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 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 TWO 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

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD09493-01-1

              

A. 6764                             2

FEDERAL  LAWS RELATING TO TAXATION AS PRESENTLY IN EFFECT OR AS THEY MAY
BE AMENDED.
                      EARNINGS TAX ON NONRESIDENTS
  SEC.  1.   MEANING OF TERMS.--AS USED IN THIS LOCAL LAW, THE FOLLOWING
TERMS SHALL MEAN AND INCLUDE: (A) "ADMINISTRATOR" MEANS  THE  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 (I) THE AMOUNT
OF MEMBER OR EMPLOYEE CONTRIBUTIONS TO A RETIREMENT  SYSTEM  OR  PENSION
FUND PICKED UP 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 OR  SECTION  13-225.1,  13-327.1,
13-125.1, 13-125.2 OR 13-521.1 OF THE ADMINISTRATIVE CODE OF THE CITY OF
NEW  YORK  OR SUBDIVISION NINETEEN OF SECTION TWENTY-FIVE HUNDRED SEVEN-
TY-FIVE OF THE EDUCATION LAW, (II) THE AMOUNT DEDUCTED OR DEFERRED  FROM
AN  EMPLOYEE'S  SALARY  UNDER  A  FLEXIBLE  BENEFITS PROGRAM ESTABLISHED
PURSUANT TO SECTION TWENTY-THREE OF THE GENERAL MUNICIPAL LAW OR SECTION
TWELVE HUNDRED TEN-A OF THE PUBLIC AUTHORITIES LAW, (III) THE AMOUNT  BY
WHICH  AN  EMPLOYEE'S  SALARY  IS  REDUCED PURSUANT TO THE PROVISIONS OF
SUBDIVISION B OF SECTION 12-126.1 AND SUBDIVISION B OF SECTION  12-126.2
OF  THE ADMINISTRATIVE CODE OF THE CITY OF NEW YORK, AND (IV) THE AMOUNT
OF MEMBER OR EMPLOYEE CONTRIBUTIONS TO A RETIREMENT  SYSTEM  OR  PENSION
FUND  PICKED UP OR PAID BY THE EMPLOYER FOR MEMBERS OF THE MANHATTAN AND
BRONX SURFACE TRANSPORTATION  AUTHORITY  PENSION  PLAN  AND  TREATED  AS
EMPLOYER CONTRIBUTIONS IN DETERMINING INCOME TAX TREATMENT UNDER SECTION
414(H) OF THE INTERNAL REVENUE CODE.
  (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

A. 6764                             3

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.--A RESIDENT INDIVIDUAL MEANS 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 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.
  (H)  NONRESIDENT  INDIVIDUAL.--A NONRESIDENT INDIVIDUAL MEANS AN INDI-
VIDUAL WHO IS NOT A RESIDENT.
  (I) RESIDENT ESTATE OR TRUST.--A RESIDENT ESTATE OR TRUST MEANS:   (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

A. 6764                             4

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.--A NONRESIDENT ESTATE OR TRUST MEANS
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  EXCEPTIONS  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.)
  (L) THE TERM "PARTNERSHIP" SHALL INCLUDE, UNLESS A  DIFFERENT  MEANING
IS  CLEARLY REQUIRED, A SUBCHAPTER K LIMITED LIABILITY COMPANY. THE TERM
"SUBCHAPTER K LIMITED LIABILITY COMPANY" SHALL MEAN A LIMITED  LIABILITY
COMPANY CLASSIFIED AS A PARTNERSHIP FOR FEDERAL INCOME TAX PURPOSES.
  THE  TERM "LIMITED LIABILITY COMPANY" MEANS A DOMESTIC LIMITED LIABIL-
ITY COMPANY OR A  FOREIGN  LIMITED  LIABILITY  COMPANY,  AS  DEFINED  IN
SECTION  ONE HUNDRED TWO OF THE LIMITED LIABILITY COMPANY LAW, A LIMITED
LIABILITY INVESTMENT COMPANY FORMED PURSUANT  TO  SECTION  FIVE  HUNDRED
SEVEN  OF  THE  BANKING LAW, OR A LIMITED LIABILITY TRUST COMPANY FORMED
PURSUANT TO SECTION ONE HUNDRED TWO-A OF THE BANKING LAW.
  SEC. 2.  PERSONS SUBJECT TO TAX.--(A)   IMPOSITION OF TAX.--A  TAX  IS
HEREBY  IMPOSED  FOR  EACH  TAXABLE YEAR BEGINNING AFTER JULY FIRST, TWO
THOUSAND TWELVE ON THE WAGES EARNED, AND NET EARNINGS FROM  SELF-EMPLOY-
MENT, WITHIN THE CITY, OF EVERY NONRESIDENT INDIVIDUAL, ESTATE AND TRUST
WHICH  SHALL  COMPRISE A TAX AT THE RATE OF ONE PERCENT ON ALL WAGES AND
ALL NET EARNINGS FROM SELF-EMPLOYMENT.
  (B)  EXCLUSION.--(1)  IN COMPUTING THE AMOUNT OF WAGES AND  NET  EARN-
INGS  FROM  SELF-EMPLOYMENT TAXABLE UNDER SUBSECTION (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  ALLOW-
ABLE SHALL BE PRORATED PURSUANT TO REGULATIONS OF THE ADMINISTRATOR.

A. 6764                             5

  (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.
  SEC.  3.    TAXABLE  YEARS  TO WHICH THE TAX IMPOSED BY THIS LOCAL LAW
APPLIES; TAX FOR TAXABLE YEARS BEGINNING AFTER JULY FIRST, TWO  THOUSAND
TWELVE.--THE  TAX  IMPOSED BY THIS LOCAL LAW IS IMPOSED FOR EACH TAXABLE
YEAR BEGINNING ON OR AFTER JULY FIRST, TWO THOUSAND TWELVE.
  SEC. 4.  ACCOUNTING PERIODS AND METHODS.--(A)  ACCOUNTING PERIODS.-- A
TAXPAYER'S TAXABLE YEAR UNDER THIS LOCAL LAW SHALL BE THE  SAME  AS  HIS
TAXABLE YEAR FOR FEDERAL INCOME TAX PURPOSES.
  (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 OF THIS  LOCAL  LAW  SHALL  BE
PRORATED UNDER REGULATIONS OF THE ADMINISTRATOR.
  (C)  ACCOUNTING METHODS.--A TAXPAYER'S METHOD OF ACCOUNTING UNDER THIS
SECTION 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 JULY FIRST, TWO THOUSAND TWELVE, 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  REGU-
LATIONS OF THE ADMINISTRATOR.
  SEC.  5.   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

A. 6764                             6

PROVIDE FOR ADDITIONAL LIMITATIONS ON AND CONDITIONS  AND  PREREQUISITES
TO THE PRIVILEGE OF NOT FILING A RETURN.
  SEC.  6. COMBINED RETURNS, EMPLOYER'S RETURNS AND PAYMENTS.--THE STATE
TAX COMMISSION MAY REQUIRE:
  (1) THE FILING OF ANY OR ALL OF THE FOLLOWING:
  (A) 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.
  (B) 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.
  (2) 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
THIS ARTICLE, ARTICLE  THIRTY  OF  THE  TAX  LAW  AND  PURSUANT  TO  THE
PROVISIONS OF ARTICLE TWENTY-TWO OF THE TAX LAW.
  SEC.  7.    EFFECT  OF  INVALIDITY IN PART; INCONSISTENCIES WITH OTHER
LAWS.--(A) IF ANY  CLAUSE,  SENTENCE,  PARAGRAPH,  SUBSECTION,  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
CIRCUMSTANCES, BUT SHALL BE CONFINED IN ITS  OPERATION  TO  THE  CLAUSE,
SENTENCE,  PARAGRAPH,  SUBSECTION,  SECTION,  PROVISION OR OTHER PORTION
THEREOF DIRECTLY INVOLVED IN SUCH HOLDING OR TO THE PERSON  AND  CIRCUM-
STANCES 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.
  (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
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

A. 6764                             7

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)  DELEGATION  OF  FUNCTIONS.--THE  LOCAL  LAW  MAY PROVIDE THAT THE
ADMINISTRATOR OF THE TAX IMPOSED, AS DEFINED IN THE LOCAL LAW, MAY DELE-
GATE 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 FINAN-
CIAL AGENTS OF THE CITY TO RECEIVE  AND  GIVE  A  RECEIPT  FOR  ANY  TAX
IMPOSED UNDER THE LOCAL LAW.
  S 25-O. DEPOSIT  AND  DISPOSITION OF REVENUES.   ONE HALF THE REVENUES
RESULTING FROM THE IMPOSITION OF THE  TAX  AUTHORIZED  BY  THIS  ARTICLE
SHALL BE:
  (A)  PAID  INTO  THE TREASURY OF THE CITY AND SHALL BE CREDITED TO AND
DEPOSITED IN THE GENERAL FUND OF SUCH CITY AND SHALL  BE  AVAILABLE  FOR
ANY LAWFUL CITY PURPOSE; AND
  (B)  DEPOSITED  IN THE METROPOLITAN TRANSPORTATION AUTHORITY FINANCIAL
ASSISTANCE FUND ESTABLISHED PURSUANT TO  SECTION  NINETY-TWO-FF  OF  THE
STATE FINANCE LAW.
  (C)  SUCH  REVENUES  SHALL  BE  DEPOSITED  AND DISPOSED OF IN THE SAME
MANNER AS REVENUES RESULTING FROM THE IMPOSITION OF THE TAXES AUTHORIZED
BY ARTICLE THIRTY OF THE TAX LAW.
  S 2. Section 1301 of the tax law is amended by adding a new subsection
(c) to read as follows:

A. 6764                             8

  (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  3.  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 4. Separability. If any clause, sentence, paragraph or part of  this
act  shall  be adjudged to be unconstitutional or invalid, such judgment
shall not affect, impair, or  invalidate,  the  remainder  thereof,  but
shall  be  confined in its operation to the clause, sentence, paragraph,
section or part thereof directly involved in the  controversy  in  which
such judgment shall have been rendered.
  S  5.  This  act  shall take effect immediately.   The commissioner of
taxation and finance is authorized to promulgate immediately and  on  an
emergency  basis  all necessary and reasonable rules and regulations for
the timely implementation of this act.