senate Bill S2732C

2011-2012 Legislative Session

Establishes an education investment tax credit

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Archive: Last Bill Status - Passed Senate


  • Introduced
  • In Committee
  • On Floor Calendar
    • Passed Senate
    • Passed Assembly
  • Delivered to Governor
  • Signed/Vetoed by Governor

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Actions

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Assembly Actions - Lowercase
Senate Actions - UPPERCASE
Jun 12, 2012 referred to ways and means
delivered to assembly
passed senate
ordered to third reading cal.1185
committee discharged and committed to rules
May 17, 2012 print number 2732c
amend and recommit to investigations and government operations
Mar 27, 2012 print number 2732b
amend and recommit to investigations and government operations
Jan 13, 2012 print number 2732a
amend and recommit to investigations and government operations
Jan 04, 2012 referred to investigations and government operations
returned to senate
died in assembly
Jun 21, 2011 referred to ways and means
delivered to assembly
passed senate
ordered to third reading cal.1453
committee discharged and committed to rules
Jun 02, 2011 reported and committed to finance
Jan 31, 2011 referred to investigations and government operations

Votes

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Jun 12, 2012 - Rules committee Vote

S2732C
20
3
committee
20
Aye
3
Nay
1
Aye with Reservations
0
Absent
1
Excused
0
Abstained
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Jun 21, 2011 - Rules committee Vote

S2732
18
4
committee
18
Aye
4
Nay
2
Aye with Reservations
0
Absent
0
Excused
0
Abstained
show committee vote details

Jun 2, 2011 - Investigations and Government Operations committee Vote

S2732
6
0
committee
6
Aye
0
Nay
2
Aye with Reservations
0
Absent
0
Excused
0
Abstained
show committee vote details

Committee Vote: Jun 2, 2011

aye wr (2)

Bill Amendments

Original
A
B
C (Active)
Original
A
B
C (Active)

Co-Sponsors

S2732 - Bill Details

Current Committee:
Law Section:
Tax Law
Laws Affected:
Amd §§606, 210 & 171, Tax L
Versions Introduced in 2009-2010 Legislative Session:
S5146A

S2732 - Bill Texts

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Establishes an education investment tax credit.

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BILL NUMBER:S2732

TITLE OF BILL:
An act
to amend the tax law, in relation to
enacting the "education investment incentives act"

PURPOSE:
This bill would authorize a personal tax credit up to $6,000 and a
corporate tax credit up to $15,000 for contributions to public
education entities, or to charitable organizations which offer
tuition assistance, or up to $75 for expenses incurred by school
personnel and parents who educate their children at home.

SUMMARY OF PROVISIONS:
This bill would permit individual public schools, including charter
schools, to accept and receive voluntary cash contributions. It also
amends section 606 of the tax law to define a "local education fund"
as a charitable organization in this state that is exempt from
federal taxation under section 501(c) (3) of the Internal Revenue
Code and is established for the specific purpose of supporting public
education within a specific public school district; a "school tuition
organization" as a charitable organization in this state that is
exempt from federal taxation under section 501(c) (3) of the Internal
Revenue Code, allocates at least eighty-seven percent of its annual
expenditures for financial assistance to students in order that they
may attend an eligible nonpublic school, and provides such assistance
to students in more than one such school. It adds subsections to
section 606 to allow a 60% tax credit up to $6,000 in any taxable
year for voluntary cash contributions to public education entities,
or to school tuition organizations, or up to $75 for the purchase of
instructional materials and classroom supplies for schools or
nonpublic home-based instruction. Contributions to local education
funds or to school tuition organizations
may not be designated for the direct benefit of any particular
student. It would also add a subsection to section 210 of the tax law
to allow a 60% credit up to $15,000 for cash contributions to public
education entities or to local education funds, or to school tuition
organizations. A subsection is also added to section 171 of the tax
law to establish an annual limit of two hundred million dollars for
such credits. Contributions exceeding this limit shall be applied to
the following tax year and the donor so notified.

JUSTIFICATION:
One of the most vexing problems facing policy makers and educators is
the funding of our educational system. When crafting annual school
budgets, school officials must grapple with rising costs, fluctuating
state and federal aid, and an often-unstable local tax base. These
ever-changing
dynamics result in valuable educational programs being reduced,
eliminated or never actually started. It is necessary to encourage
greater private sector support of educational opportunities for
children. Private sector resources, from both individuals and
businesses, not only to help stabilize the school budget process, but
allow schools to maintain, expand or begin worthwhile programs. An
education investment tax credit, as established by this act, will


involve the private sector, both individuals and corporations, and
may encourage donations to public education entities, along with
educational scholarship organizations benefitting students attending
independent and religious schools. The tax credit provided in this
act is merely one of many credits available to New York taxpayers.
The intended beneficiaries of the tax credit provided in this act are
the students who attend public schools, charter schools, and anyone
who furthers their education using tuition scholarships from
educational scholarship organizations, or who participates in a
home-based educational program. The tax credit does not constitute
public aid to non-public sectarian institutions; permitting school
personnel to claim a credit for the purchase of classroom
instructional materials and supplies will insure a wider
availability of such materials and supplies for all students.

LEGISLATIVE HISTORY:
Similar to S.5146 of 2009-10 - Reported from Investigations, Referred
to Finance.

FISCAL IMPLICATIONS:
The Department of Taxation & Finance has yet to project a first-year
revenue reduction. However, as it would affect only the Fourth
Quarter of FY 2011-12, it would be less than the $200 million allowed
when fully implemented. Since the bill allows only a partial credit,
it has the potential to generate $333 million in voluntary
contributions to support K-12 education in New York State.
Stabilizing the independent and religious sector will significantly
lessen the need for local school tax increases as well as for the
issuance of bonds for new public school construction, generating
further savings for the state.

EFFECTIVE DATE:
This act shall take effect on the first day of January next succeeding
the date on which it shall have become a law.

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

                                  2732

                       2011-2012 Regular Sessions

                            I N  S E N A T E

                            January 31, 2011
                               ___________

Introduced by Sens. GOLDEN, GRISANTI, MARTINS, MAZIARZ -- read twice and
  ordered  printed, and when printed to be committed to the Committee on
  Investigations and Government Operations

AN ACT to amend the tax law, in  relation  to  enacting  the  "education
  investment incentives act"

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

  Section 1. Short title. This act shall be known and may  be  cited  as
the "education investment incentives act".
  S 2. Legislative findings and intent. The legislature hereby finds and
declares that:
  a.  At  a  time when the state is considering ways of reducing the tax
burden for New York state residents and educators are seeking an  expan-
sion  of financial resources, charitable giving for educational purposes
should be stimulated;
  b. Permitting public education entities such as school  districts  and
individual  public  schools,  including  charter  schools, to accept and
receive voluntary cash contributions will lessen the need for additional
tax revenue;
  c. Encouraging voluntary support for education, without prejudice  for
or  against  any  state-sanctioned  educational enterprise, promotes the
state's interest in providing the highest quality education to all chil-
dren in the state;
  d. Requiring a sharing of resources among school districts will insure
a more equitable distribution of financial support;
  e. The tax credit provided in this act is merely one of  many  credits
available to New York taxpayers;
  f.  The  intended beneficiaries of the tax credit provided in this act
are the students who attend public schools, including  charter  schools,
or  who  further their educations using tuition scholarships from educa-
tional scholarship  organizations,  or  who  participate  in  home-based

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD05643-02-1

S. 2732                             2

educational  programs;  therefore  the  tax  credit  does not constitute
public aid to non-public sectarian institutions;
  g.  Permitting  school personnel to claim a credit for the purchase of
classroom instructional materials  and  supplies  will  insure  a  wider
availability of such materials and supplies for all students.
  S  3.  Section  606  of  the  tax  law  is  amended by adding five new
subsections (u), (v), (w), (w-1) and (w-2) to read as follows:
  (U) DEFINITIONS. AS USED IN SUBSECTIONS (V), (W), (W-1) AND  (W-2)  OF
THIS SECTION, THE FOLLOWING TERMS SHALL HAVE THE FOLLOWING MEANINGS:
  (1) "PUBLIC EDUCATION ENTITY" SHALL MEAN ANY PUBLIC SCHOOL DISTRICT OR
ANY INDIVIDUAL PUBLIC SCHOOL, INCLUDING ANY CHARTER SCHOOL.
  (2)  "LOCAL  EDUCATION  FUND"  SHALL MEAN A CHARITABLE ORGANIZATION IN
THIS STATE THAT:
  (A) IS EXEMPT FROM FEDERAL TAXATION UNDER SECTION 501  (C)(3)  OF  THE
INTERNAL REVENUE CODE; AND
  (B)  IS  ESTABLISHED  FOR  THE  EXPLICIT  PURPOSE OF SUPPORTING PUBLIC
EDUCATION WITHIN A SPECIFIC PUBLIC SCHOOL DISTRICT.
  (3) "EDUCATIONAL SCHOLARSHIP ORGANIZATION"  SHALL  MEAN  A  CHARITABLE
ORGANIZATION IN THIS STATE THAT:
  (A)  IS  EXEMPT  FROM FEDERAL TAXATION UNDER SECTION 501 (C)(3) OF THE
INTERNAL REVENUE CODE; AND
  (B) ALLOCATES AT LEAST EIGHTY-SEVEN PERCENT OF ITS ANNUAL EXPENDITURES
FOR EDUCATIONAL SCHOLARSHIPS OR TUITION GRANTS TO CHILDREN ALLOWING THEM
TO ATTEND ANY ELIGIBLE RELIGIOUS OR INDEPENDENT SCHOOL AND/OR TO RECEIVE
TUTORING AND MENTORING SERVICES IN AN ELIGIBLE RELIGIOUS OR  INDEPENDENT
SCHOOL, OR FOR OTHER EDUCATIONAL PURPOSES; AND
  (C) MAKES EDUCATIONAL SCHOLARSHIPS, WHICH MAY INCLUDE SCHOLARSHIPS FOR
TUTORING AND MENTORING SERVICES, OR TUITION GRANTS AVAILABLE TO CHILDREN
FROM  MORE  THAN ONE PUBLIC OR ELIGIBLE RELIGIOUS OR INDEPENDENT SCHOOL;
AND
  (D) REPORTS ANNUALLY TO THE DEPARTMENT THE GROSS  RECEIPTS  AND  GROSS
AMOUNT EXPENDED FOR SCHOLARSHIPS AND TUITION GRANTS, MENTORING SERVICES,
AND OTHER EDUCATIONAL PURPOSES.
  (4)  "ELIGIBLE  RELIGIOUS  OR INDEPENDENT SCHOOL" SHALL MEAN ANY RELI-
GIOUS OR INDEPENDENT PRIMARY OR SECONDARY SCHOOL THAT IS LOCATED IN THIS
STATE, THAT SATISFIES  THE  REQUIREMENTS  PRESCRIBED  BY  LAW  FOR  SUCH
SCHOOLS  IN THIS STATE, AND THAT HAS QUALIFIED FOR FEDERAL TAX EXEMPTION
UNDER SECTION 501 (C)(3) OF THE INTERNAL REVENUE CODE.
  (5) "AUTHORIZED CERTIFICATE  OF  RECEIPT"  SHALL  MEAN  A  CERTIFICATE
DESIGNED BY THE COMMISSIONER FOR THE PURPOSE OF ACKNOWLEDGING RECEIPT OF
A  CHARITABLE  CONTRIBUTION  BY  THE CHIEF EXECUTIVE OFFICER OF A PUBLIC
EDUCATION ENTITY, OR OF A LOCAL EDUCATION  FUND  OR  OF  AN  EDUCATIONAL
SCHOLARSHIP ORGANIZATION.
  (V) CONTRIBUTIONS TO PUBLIC EDUCATION CREDIT. FOR TAXABLE YEARS BEGIN-
NING ON OR AFTER JANUARY FIRST, TWO THOUSAND TWELVE, A CREDIT IS ALLOWED
AGAINST THE TAX IMPOSED BY THIS ARTICLE FOR VOLUNTARY CASH CONTRIBUTIONS
MADE BY THE TAXPAYER DURING THE TAXABLE YEAR TO A PUBLIC EDUCATION ENTI-
TY. ACCEPTANCE AND RECEIPT OF ALL SUCH CONTRIBUTIONS SHALL BE PERMITTED.
A  TAXPAYER WHO SUBMITS WITH HIS OR HER TAX RETURN AN AUTHORIZED CERTIF-
ICATE OF RECEIPT SHALL BE ALLOWED A CREDIT, TO BE COMPUTED   AS  HEREIN-
AFTER PROVIDED, AGAINST THE TAX IMPOSED BY THIS ARTICLE.
  (1) THE AMOUNT OF THE CREDIT.
  (A)  THIS  CREDIT  SHALL  BE  VALUED AT SIXTY PERCENT OF SUCH CONTRIB-
UTIONS, NOT TO EXCEED SIX THOUSAND DOLLARS IN ANY TAXABLE YEAR.
  (B) A SHAREHOLDER OF A NEW YORK S CORPORATION OR A PARTNER OF A  PART-
NERSHIP  (OR  OTHER  ENTITY  TREATED  AS  A  PARTNERSHIP  FOR INCOME TAX

S. 2732                             3

PURPOSES) SHALL BE TREATED AS THE TAXPAYER WITH RESPECT TO  HIS  OR  HER
PRO-RATA  SHARE  OF  THE  TAX  CREDIT ALLOWABLE TO SUCH S CORPORATION OR
PARTNERSHIP, DETERMINED FOR THE S CORPORATION'S OR PARTNERSHIP'S TAXABLE
YEAR  ENDING WITH OR WITHIN THE SHAREHOLDER'S OR PARTNER'S TAXABLE YEAR.
THE MAXIMUM AMOUNT OF THE CREDIT FOR SUCH S CORPORATION  OR  PARTNERSHIP
SHALL  BE  THE SAME AS THAT ALLOWABLE TO CORPORATIONS UNDER SUBDIVISIONS
FORTY-FOUR AND FORTY-FIVE OF SECTION TWO HUNDRED TEN OF THIS CHAPTER.
  (2) A HUSBAND AND WIFE WHO FILE SEPARATE RETURNS FOR A TAXABLE YEAR IN
WHICH THEY COULD HAVE FILED A JOINT RETURN MAY EACH CLAIM ONLY  ONE-HALF
OF THE TAX CREDIT THAT WOULD HAVE BEEN ALLOWED FOR A JOINT RETURN.
  (3)  IF THE ALLOWABLE TAX CREDIT EXCEEDS THE TAXES OTHERWISE DUE UNDER
THIS ARTICLE ON THE TAXPAYER'S INCOME, OR IF  THERE  ARE  NO  TAXES  DUE
UNDER  THIS ARTICLE, THE TAXPAYER MAY CARRY THE AMOUNT OF THE CREDIT NOT
USED TO OFFSET THE TAXES UNDER THIS ARTICLE FORWARD FOR  NOT  MORE  THAN
FIVE YEARS INCOME TAX LIABILITY.
  (4)  CONTRIBUTIONS OF TEN THOUSAND DOLLARS OR LESS IN ANY TAXABLE YEAR
SHALL NOT BE CONSIDERED ELIGIBLE DEDUCTIONS AS ALLOWED UNDER THIS  ARTI-
CLE  FOR  CHARITABLE CONTRIBUTIONS. CONTRIBUTIONS IN EXCESS OF TEN THOU-
SAND DOLLARS IN ANY TAXABLE YEAR SHALL BE CONSIDERED ELIGIBLE DEDUCTIONS
AS ALLOWED UNDER THIS ARTICLE FOR CHARITABLE CONTRIBUTIONS.
  (5) SUCH CONTRIBUTIONS SHALL BE DEPOSITED IN A SEPARATE ACCOUNT.
  (6) IF MADE TO A PUBLIC SCHOOL DISTRICT SUCH  CONTRIBUTIONS  SHALL  BE
SUPERVISED  BY  A  PERSON SO DESIGNATED BY THE CHANCELLOR OR SUPERINTEN-
DENT. IF MADE TO A PARTICULAR SCHOOL THEY SHALL  BE  SUPERVISED  BY  THE
SCHOOL PRINCIPAL. REPORTS OF DEPOSITS AND DISBURSEMENTS SHALL BE MADE TO
THE  LOCAL  BOARD OF EDUCATION ANNUALLY. CHARTER SCHOOLS SHALL MAKE SUCH
REPORTS TO THE STATE EDUCATION DEPARTMENT.
  (W) CONTRIBUTIONS TO LOCAL EDUCATION FUND CREDIT. IN LIEU OF  CONTRIB-
UTIONS IN SUBSECTION (V) OF THIS SECTION, A CREDIT IS ALLOWED:
  (1) FOR THE AMOUNT OF VOLUNTARY CASH CONTRIBUTIONS MADE BY THE TAXPAY-
ER  DURING  THE  TAXABLE  YEAR TO A LOCAL EDUCATION FUND. A TAXPAYER WHO
SUBMITS WITH HIS OR HER TAX RETURN AN AUTHORIZED CERTIFICATE OF  RECEIPT
SHALL  BE  ALLOWED  A  CREDIT,  TO  BE COMPUTED AS HEREINAFTER PROVIDED,
AGAINST THE TAX IMPOSED BY THIS ARTICLE.
  (A) THIS CREDIT SHALL BE VALUED AT  SIXTY  PERCENT  OF  SUCH  CONTRIB-
UTIONS, NOT TO EXCEED SIX THOUSAND DOLLARS IN ANY TAXABLE YEAR. A SHARE-
HOLDER  OF  A  NEW  YORK S CORPORATION OR A PARTNER OF A PARTNERSHIP (OR
OTHER ENTITY TREATED AS A PARTNERSHIP FOR INCOME TAX PURPOSES) SHALL  BE
TREATED AS THE TAXPAYER WITH RESPECT TO HIS OR HER PRO-RATA SHARE OF THE
TAX  CREDIT  ALLOWABLE  TO SUCH S CORPORATION OR PARTNERSHIP, DETERMINED
FOR THE S CORPORATION'S OR PARTNERSHIP'S TAXABLE  YEAR  ENDING  WITH  OR
WITHIN  THE  SHAREHOLDER'S OR PARTNER'S TAXABLE YEAR. THE MAXIMUM AMOUNT
OF THE CREDIT FOR SUCH S CORPORATION OR PARTNERSHIP SHALL BE THE SAME AS
THAT ALLOWABLE TO CORPORATIONS UNDER SUBDIVISIONS FORTY-FOUR AND  FORTY-
FIVE OF SECTION TWO HUNDRED TEN OF THIS CHAPTER.
  (B) A HUSBAND AND WIFE WHO FILE SEPARATE RETURNS FOR A TAXABLE YEAR IN
WHICH  THEY COULD HAVE FILED A JOINT RETURN MAY EACH CLAIM ONLY ONE-HALF
OF THE TAX CREDIT THAT WOULD HAVE BEEN ALLOWED FOR A JOINT RETURN.
  (C) IF THE ALLOWABLE TAX CREDIT EXCEEDS THE TAXES OTHERWISE DUE  UNDER
THIS  ARTICLE  ON THE TAXPAYER'S INCOME, OR IF THERE ARE TAXES DUE UNDER
THIS ARTICLE, THE TAXPAYER MAY CARRY THE AMOUNT OF THE CREDIT  NOT  USED
TO  OFFSET  THE  TAXES UNDER THIS ARTICLE FORWARD FOR NOT MORE THAN FIVE
YEARS' INCOME TAX LIABILITY.
  (D) CONTRIBUTIONS IN EXCESS OF TEN THOUSAND  DOLLARS  IN  ANY  TAXABLE
YEAR SHALL BE CONSIDERED ELIGIBLE DEDUCTIONS AS ALLOWED UNDER THIS ARTI-
CLE FOR CHARITABLE CONTRIBUTIONS.

S. 2732                             4

  (E) THIS TAX CREDIT MAY NOT BE CLAIMED FOR ANY CONTRIBUTION TO A LOCAL
EDUCATION FUND FOR THE BENEFIT OF A DESIGNATED STUDENT.
  (2) FOR THE AMOUNT OF VOLUNTARY CASH CONTRIBUTIONS MADE BY THE TAXPAY-
ER DURING THE TAXABLE YEAR TO AN EDUCATIONAL SCHOLARSHIP ORGANIZATION. A
TAXPAYER  WHO  SUBMITS  WITH HIS OR HER TAX RETURN AN AUTHORIZED CERTIF-
ICATE OF RECEIPT SHALL BE ALLOWED A CREDIT, TO BE COMPUTED AS HEREINAFT-
ER PROVIDED, AGAINST THE TAX IMPOSED BY THIS ARTICLE.
  (A) THIS CREDIT SHALL BE VALUED AT  SIXTY  PERCENT  OF  SUCH  CONTRIB-
UTIONS, NOT TO EXCEED SIX THOUSAND DOLLARS IN ANY TAXABLE YEAR. A SHARE-
HOLDER  OF  A  NEW  YORK S CORPORATION OR A PARTNER OF A PARTNERSHIP (OR
OTHER ENTITY TREATED AS A PARTNERSHIP FOR INCOME TAX PURPOSES) SHALL  BE
TREATED AS THE TAXPAYER WITH RESPECT TO HIS OR HER PRO-RATA SHARE OF THE
TAX  CREDIT  ALLOWABLE  TO SUCH S CORPORATION OR PARTNERSHIP, DETERMINED
FOR THE S CORPORATION'S OR PARTNERSHIP'S TAXABLE  YEAR  ENDING  WITH  OR
WITHIN  THE  SHAREHOLDER'S OR PARTNER'S TAXABLE YEAR. THE MAXIMUM AMOUNT
OF THE CREDIT FOR SUCH S CORPORATION OR PARTNERSHIP SHALL BE THE SAME AS
THAT ALLOWABLE TO CORPORATIONS UNDER SUBDIVISIONS FORTY-FOUR AND  FORTY-
FIVE OF SECTION TWO HUNDRED TEN OF THIS CHAPTER.
  (B) A HUSBAND AND WIFE WHO FILE SEPARATE RETURNS FOR A TAXABLE YEAR IN
WHICH  THEY COULD HAVE FILED A JOINT RETURN MAY EACH CLAIM ONLY ONE-HALF
OF THE TAX CREDIT THAT WOULD HAVE BEEN ALLOWED FOR A JOINT RETURN.
  (C) IF THE ALLOWABLE TAX CREDIT EXCEEDS THE TAXES OTHERWISE DUE  UNDER
THIS  ARTICLE  ON  THE  TAXPAYER'S  INCOME, OR IF THERE ARE NO TAXES DUE
UNDER THIS ARTICLE, THE TAXPAYER MAY CARRY THE AMOUNT OF THE CREDIT  NOT
USED  TO  OFFSET  THE TAXES UNDER THIS ARTICLE FORWARD FOR NOT MORE THAN
FIVE YEARS' INCOME TAX LIABILITY.
  (D) CONTRIBUTIONS IN EXCESS OF TEN THOUSAND  DOLLARS  IN  ANY  TAXABLE
YEAR SHALL BE CONSIDERED ELIGIBLE DEDUCTIONS AS ALLOWED UNDER THIS ARTI-
CLE FOR CHARITABLE CONTRIBUTIONS.
  (E)  THIS  TAX  CREDIT  MAY  NOT BE CLAIMED FOR ANY CONTRIBUTION TO AN
EDUCATIONAL SCHOLARSHIP ORGANIZATION FOR THE  BENEFIT  OF  A  DESIGNATED
STUDENT.
  (W-1)  HOME-BASED  INSTRUCTIONAL MATERIALS CREDIT. IN LIEU OF CONTRIB-
UTIONS IN SUBSECTIONS (V) AND (W) OF THIS SECTION, A CREDIT  IS  ALLOWED
FOR  THE  PURCHASE  OF INSTRUCTIONAL MATERIALS FOR NON-PUBLIC HOME-BASED
EDUCATIONAL PROGRAMS. THIS CREDIT SHALL BE VALUED AT  SIXTY  PERCENT  OF
SUCH PURCHASES.
  (1) THE AMOUNT OF SUCH CREDIT SHALL NOT EXCEED SEVENTY-FIVE DOLLARS IN
ANY TAXABLE YEAR.
  (2) A HUSBAND AND WIFE WHO FILE SEPARATE RETURNS FOR A TAXABLE YEAR IN
WHICH  THEY COULD HAVE FILED A JOINT RETURN MAY EACH CLAIM ONLY ONE-HALF
OF THE TAX CREDIT THAT WOULD HAVE BEEN ALLOWED FOR A JOINT RETURN.
  (3) IF THE ALLOWABLE TAX CREDIT EXCEEDS THE TAXES OTHERWISE DUE  UNDER
THIS  ARTICLE  ON  THE  TAXPAYER'S  INCOME, OR IF THERE ARE NO TAXES DUE
UNDER THIS ARTICLE, THE TAXPAYER MAY CARRY THE AMOUNT OF THE CREDIT  NOT
USED  TO  OFFSET  THE TAXES UNDER THIS ARTICLE FORWARD FOR NOT MORE THAN
FIVE YEARS' INCOME TAX LIABILITY.
  (4) IF THE TAXPAYER SHALL BE RESPONSIBLE FOR NOTIFYING THE COMMISSION-
ER OF THE INTENTION TO CLAIM THE ALLOWABLE CREDIT, NO LATER THAN  DECEM-
BER THIRTY-FIRST.
  (W-2)  CLASSROOM INSTRUCTIONAL MATERIALS AND SUPPLIES CREDIT. A CREDIT
IS ALLOWED FOR THE PURCHASE OF  CLASSROOM  INSTRUCTIONAL  MATERIALS  AND
SUPPLIES  FOR  PERSONNEL  EMPLOYED  IN  ANY PUBLIC SCHOOL, INCLUDING ANY
CHARTER SCHOOL, OR IN ANY ELIGIBLE RELIGIOUS OR INDEPENDENT SCHOOL.

S. 2732                             5

  (1) THIS CREDIT SHALL BE VALUED AT SIXTY PERCENT  OF  SUCH  PURCHASES.
THE  AMOUNT  OF SUCH CREDIT SHALL NOT EXCEED SEVENTY-FIVE DOLLARS IN ANY
TAXABLE YEAR.
  (2)  THE  TAXPAYER SHALL BE RESPONSIBLE FOR NOTIFYING THE COMMISSIONER
OF THE INTENTION TO CLAIM THE ALLOWABLE CREDIT, NO LATER  THAN  DECEMBER
THIRTY-FIRST,  INDICATING  WHETHER  THE  PURCHASE  WAS MADE FOR USE IN A
PUBLIC SCHOOL, INCLUDING A CHARTER SCHOOL, OR AN ELIGIBLE  RELIGIOUS  OR
INDEPENDENT SCHOOL.
  S 4. Section 210 of the tax law is amended by adding four new subdivi-
sions 43, 44, 45 and 46 to read as follows:
  43.  DEFINITIONS. AS USED IN SUBDIVISIONS FORTY-FOUR AND FORTY-FIVE OF
THIS SECTION THE FOLLOWING TERMS SHALL HAVE THE FOLLOWING MEANINGS:
  (A) "PUBLIC EDUCATION ENTITY" SHALL MEAN ANY PUBLIC SCHOOL DISTRICT OR
ANY INDIVIDUAL PUBLIC SCHOOL, INCLUDING ANY CHARTER SCHOOL.
  (B) "LOCAL EDUCATION FUND" SHALL MEAN  A  CHARITABLE  ORGANIZATION  IN
THIS STATE THAT:
  (1)  IS  EXEMPT  FROM FEDERAL TAXATION UNDER SECTION 501(C) (3) OF THE
INTERNAL REVENUE CODE; AND
  (2) IS ESTABLISHED FOR  THE  EXPLICIT  PURPOSE  OF  SUPPORTING  PUBLIC
EDUCATION WITHIN A SPECIFIC PUBLIC SCHOOL DISTRICT; AND
  (3)  REPORTS  ANNUALLY  TO THE DEPARTMENT THE GROSS RECEIPTS AND GROSS
AMOUNT EXPENDED IN SUPPORT OF PUBLIC EDUCATION.
  (C) "EDUCATIONAL SCHOLARSHIP ORGANIZATION"  SHALL  MEAN  A  CHARITABLE
ORGANIZATION IN THIS STATE THAT:
  (1)  IS  EXEMPT  FROM  FEDERAL TAXATION UNDER SECTION 501(C)(3) OF THE
INTERNAL REVENUE CODE; AND
  (2) ALLOCATES AT LEAST EIGHTY-SEVEN PERCENT OF ITS ANNUAL EXPENDITURES
FOR EDUCATIONS SCHOLARSHIPS OR TUITION GRANTS TO CHILDREN ALLOWING  THEM
TO ATTEND ANY ELIGIBLE RELIGIOUS OR INDEPENDENT SCHOOL AND/OR TO RECEIVE
TUTORING  AND MENTORING SERVICES IN AN ELIGIBLE RELIGIOUS OR INDEPENDENT
SCHOOL, OR FOR OTHER EDUCATIONAL PURPOSES; AND
  (3) MAKES EDUCATIONAL SCHOLARSHIPS, WHICH MAY INCLUDE SCHOLARSHIPS FOR
TUTORING AND MENTORING SERVICES, OR TUITION GRANTS AVAILABLE TO CHILDREN
FROM MORE THAN ONE PUBLIC OR ELIGIBLE RELIGIOUS OR  INDEPENDENT  SCHOOL;
AND
  (4)  REPORTS  ANNUALLY  TO THE DEPARTMENT THE GROSS RECEIPTS AND GROSS
AMOUNT EXPENDED FOR SCHOLARSHIPS AND TUITION GRANTS.
  (D) "ELIGIBLE RELIGIOUS OR INDEPENDENT SCHOOL" SHALL  MEAN  ANY  RELI-
GIOUS OR INDEPENDENT PRIMARY OR SECONDARY SCHOOL THAT IS LOCATED IN THIS
STATE,  THAT  SATISFIES  THE  REQUIREMENTS  PRESCRIBED  BY  LAW FOR SUCH
SCHOOLS IN THIS STATE, AND THAT HAS QUALIFIED FOR FEDERAL TAX  EXEMPTION
UNDER SECTION 501(C)(3) OF THE INTERNAL REVENUE CODE.
  (E)  "AUTHORIZED  CERTIFICATE  OF  RECEIPT"  SHALL  MEAN A CERTIFICATE
DESIGNED BY THE COMMISSIONER FOR THE PURPOSE OF ACKNOWLEDGING RECEIPT OF
A CHARITABLE CONTRIBUTION BY THE CHIEF EXECUTIVE  OFFICER  OF  A  PUBLIC
EDUCATION  ENTITY,  OR  OF  A  LOCAL EDUCATION FUND OR OF AN EDUCATIONAL
SCHOLARSHIP ORGANIZATION.
  44. CONTRIBUTIONS TO PUBLIC EDUCATION CREDIT. (A)  FOR  TAXABLE  YEARS
BEGINNING  ON  OR  AFTER JANUARY FIRST, TWO THOUSAND TWELVE, A CREDIT IS
ALLOWED AGAINST THE TAX IMPOSED  BY  THIS  ARTICLE  FOR  VOLUNTARY  CASH
CONTRIBUTIONS  MADE  BY THE TAXPAYER DURING THE TAXABLE YEAR TO A PUBLIC
EDUCATION ENTITY. ACCEPTANCE AND RECEIPT OF ALL SUCH CONTRIBUTIONS SHALL
BE PERMITTED. A TAXPAYER WHO SUBMITS WITH HIS OR HER TAX CREDIT,  TO  BE
COMPUTED  AS HEREINAFTER PROVIDED, AGAINST THE TAX IMPOSED BY THIS ARTI-
CLE. THIS CREDIT SHALL BE VALUED AT SIXTY PERCENT OF SUCH CONTRIBUTIONS,
NOT TO EXCEED FIFTEEN THOUSAND DOLLARS IN ANY TAXABLE YEAR.

S. 2732                             6

  (B) SUCH CONTRIBUTIONS SHALL BE DEPOSITED IN A SEPARATE ACCOUNT.
  (C)  IF  MADE  TO A PUBLIC SCHOOL DISTRICT SUCH CONTRIBUTIONS SHALL BE
SUPERVISED BY A PERSON SO DESIGNATED BY THE  CHANCELLOR  OR  SUPERINTEN-
DENT.  IF  MADE  TO  A PARTICULAR SCHOOL THEY SHALL BE SUPERVISED BY THE
SCHOOL PRINCIPAL. REPORTS OF DEPOSITS AND DISBURSEMENTS SHALL BE MADE TO
THE LOCAL BOARD OF EDUCATION ANNUALLY. CHARTER SCHOOLS SHALL  MAKE  SUCH
REPORTS TO THE STATE EDUCATION DEPARTMENT.
  45.  CONTRIBUTIONS TO LOCAL EDUCATION FUND CREDIT. IN LIEU OF CONTRIB-
UTIONS IN SUBDIVISION FORTY-FOUR OF THIS SECTION, A CREDIT IS ALLOWED:
  (A) FOR THE AMOUNT OF VOLUNTARY CASH CONTRIBUTIONS MADE BY THE TAXPAY-
ER DURING THE TAXABLE YEAR TO A LOCAL EDUCATION  FUND.  A  TAXPAYER  WHO
SUBMITS  WITH HIS OR HER TAX RETURN AN AUTHORIZED CERTIFICATE OF RECEIPT
SHALL BE ALLOWED A CREDIT,  TO  BE  COMPUTED  AS  HEREINAFTER  PROVIDED,
AGAINST THE TAX IMPOSED BY THIS ARTICLE.
  (1) THE AMOUNT OF SUCH CREDIT SHALL BE VALUED AT SIXTY PERCENT OF SUCH
CONTRIBUTIONS,  NOT  TO  EXCEED  FIFTEEN THOUSAND DOLLARS IN ANY TAXABLE
YEAR.
  (2) THIS TAX CREDIT MAY NOT BE CLAIMED FOR ANY CONTRIBUTION TO A LOCAL
EDUCATION FUND FOR THE BENEFIT OF A DESIGNATED STUDENT.
  (B) FOR THE AMOUNT OF VOLUNTARY CASH CONTRIBUTIONS MADE BY THE TAXPAY-
ER DURING THE TAXABLE YEAR TO AN EDUCATIONAL SCHOLARSHIP ORGANIZATION. A
TAXPAYER WHO SUBMITS WITH HIS OR HER TAX RETURN  AN  AUTHORIZED  CERTIF-
ICATE OF RECEIPT SHALL BE ALLOWED A CREDIT, TO BE COMPUTED AS HEREINAFT-
ER PROVIDED, AGAINST THE TAX IMPOSED BY THIS ARTICLE.
  (1) THE AMOUNT OF SUCH CREDIT SHALL BE VALUED AT SIXTY PERCENT OF SUCH
CONTRIBUTIONS,  NOT  TO  EXCEED  FIFTEEN THOUSAND DOLLARS IN ANY TAXABLE
YEAR.
  (2) THIS TAX CREDIT MAY NOT BE CLAIMED  FOR  ANY  CONTRIBUTION  TO  AN
EDUCATIONAL  SCHOLARSHIP  ORGANIZATION  FOR  THE BENEFIT OF A DESIGNATED
STUDENT.
  46. SCHOOL DISTRICTS RECEIVING CONTRIBUTIONS IN EXCESS OF ONE  PERCENT
OF  THEIR PREVIOUS YEAR'S BUDGET SHALL BE REQUIRED TO REMIT A MINIMUM OF
THIRTY-FIVE PERCENT OF ANY SUCH EXCESS AMOUNT TO A FUND ADMINISTERED  BY
THE  COMMISSIONER,  TO BE DISTRIBUTED TO SCHOOL DISTRICTS RECEIVING LESS
THAN ONE-HALF OF ONE PERCENT OF THEIR PREVIOUS YEAR'S BUDGET.   CONTRIB-
UTIONS TO SCHOOL DISTRICTS, TO INDIVIDUAL SCHOOLS (NOT INCLUDING CHARTER
SCHOOLS)  AND  TO  LOCAL  EDUCATION  FUNDS  SHALL  BE AGGREGATED FOR THE
PURPOSES OF THIS SECTION. SUCH PAYMENTS SHALL BE CALCULATED ON A  CALEN-
DAR  YEAR  BASIS  AND  SHALL  BE  MADE  NO LATER THAN MARCH FIRST OF THE
FOLLOWING YEAR.
  S 5. Section 171 of the tax law is amended by adding a new subdivision
twenty-ninth to read as follows:
  TWENTY-NINTH. FOR  THE  PURPOSE  OF  IMPLEMENTING  THE  PROVISIONS  OF
SUBSECTIONS  (U),  (V),  (W), (W-1) AND (W-2) OF SECTION SIX HUNDRED SIX
AND SUBDIVISIONS FORTY-THREE, FORTY-FOUR, FORTY-FIVE  AND  FORTY-SIX  OF
SECTION TWO HUNDRED TEN OF THIS CHAPTER THE COMMISSIONER SHALL:
  (1)  REGISTER  PUBLIC  SCHOOL  DISTRICTS,  INDIVIDUAL  PUBLIC SCHOOLS,
INCLUDING CHARTER SCHOOLS, LOCAL EDUCATION FUNDS, AND EDUCATIONAL SCHOL-
ARSHIP ORGANIZATIONS; AND
  (2) UPON NOTIFICATION BY THE CHIEF EXECUTIVE OFFICER OF ANY  EDUCATION
ENTITY SO REGISTERED THAT A CONTRIBUTION HAS BEEN RECEIVED, SUCH NOTIFI-
CATION  BEING WITHIN ONE BUSINESS DAY OF SAID RECEIPT, RECORD THE AMOUNT
AND DATE OF THE CONTRIBUTION, THE NAME AND ADDRESS OF  THE  CONTRIBUTOR;
AND
  (3)  UPON NOTIFICATION THAT A CREDIT FOR THE PURCHASE OF INSTRUCTIONAL
MATERIALS FOR NON-PUBLIC HOME-BASED  EDUCATIONAL  PROGRAMS,  RECORD  THE

S. 2732                             7

AMOUNT  AND DATE OF THE NOTIFICATION, THE NAME AND ADDRESS OF THE CLAIM-
ANT; AND
  (4)  UPON NOTIFICATION THAT A CREDIT FOR THE PURCHASE OF THE CLASSROOM
INSTRUCTIONAL MATERIALS AND SUPPLIES, RECORD THE AMOUNT AND DATE OF  THE
NOTIFICATION,  THE  NAME  AND  ADDRESS  OF THE CLAIMANT, AND WHETHER THE
PURCHASE WAS MADE FOR USE  IN  A  PUBLIC  SCHOOL,  INCLUDING  A  CHARTER
SCHOOL, OR AN ELIGIBLE RELIGIOUS OR INDEPENDENT SCHOOL; AND
  (5) MAKE NO MORE THAN TWO HUNDRED MILLION DOLLARS IN CREDITS AVAILABLE
IN  ANY  SINGLE  TAX  YEAR,  PROVIDED FURTHER THAT FIFTY PERCENT OF SUCH
CREDITS SHALL BE AFFORDED TO TAXPAYERS  WHO  MAKE  DONATIONS  TO  PUBLIC
EDUCATION  ENTITIES  AND  LOCAL EDUCATION FUNDS, AND FOR THE PURCHASE OF
CLASSROOM INSTRUCTIONAL MATERIALS AND  SUPPLIES  FOR  USE  IN  A  PUBLIC
SCHOOL OR A CHARTER SCHOOL, AND THAT FIFTY PERCENT OF SUCH CREDITS SHALL
BE  AFFORDED  TO  EDUCATION  SCHOLARSHIP ORGANIZATIONS OR FOR HOME-BASED
INSTRUCTIONAL MATERIALS, AND FOR THE PURCHASE OF CLASSROOM INSTRUCTIONAL
MATERIALS AND SUPPLIES FOR USE IN AN ELIGIBLE RELIGIOUS  OR  INDEPENDENT
SCHOOL; AND
  (6)  ISSUE TO TAXPAYERS ALL AUTHORIZED CERTIFICATES OF RECEIPT FOR ALL
ELIGIBLE CREDITS NO LATER THAN JANUARY THIRTY-FIRST FOR CREDITS  CLAIMED
FOR THE PREVIOUS CALENDAR YEAR.
  S  6. Excess contributions. Contributions exceeding the allowed annual
maximum of one hundred million dollars  to  public  education  entities,
local  education  funds  and for the purchase of classroom instructional
materials and supplies for use in a public school or a  charter  school,
or  the  allowed annual maximum of one hundred million dollars to educa-
tion scholarship organizations, for home-based  instructional  materials
and  for  the purchase of classroom instructional materials and supplies
for use in an eligible religious or independent school, shall be applied
to the following tax year, and the donor so notified within one business
day.
  S 7. The department of taxation and finance shall  prepare  a  written
report  before  January  31  of  each calendar year, which shall contain
statistical  information  regarding  the  credits  allowed  pursuant  to
subsections  (u),  (v), (w), (w-1) and (w-2) of section 606 and subdivi-
sions 43, 44, 45 and 46 of section 210  of  the  tax  law  as  added  by
sections  three  and  four  of this act, for the previous calendar year.
Copies of such report shall be submitted to the governor, the  temporary
president  of  the senate, the speaker of the assembly, the chair of the
senate finance committee and the chair of the assembly  ways  and  means
committee.  Such  reports shall contain, but need not be limited to, the
number of credits by type and the amount  of  such  credits  allowed  to
taxpayers.
  S  8. This act shall take effect on the first of January next succeed-
ing the date on which it shall have become a law.

Co-Sponsors

S2732A - Bill Details

Current Committee:
Law Section:
Tax Law
Laws Affected:
Amd §§606, 210 & 171, Tax L
Versions Introduced in 2009-2010 Legislative Session:
S5146A

S2732A - Bill Texts

view summary

Establishes an education investment tax credit.

view sponsor memo
BILL NUMBER:S2732A

TITLE OF BILL:
An act
to amend the tax law, in relation to
enacting the "education investment incentives act"

PURPOSE OR GENERAL IDEA OF BILL:
This bill would authorize a personal
tax credit up to $6,000 and a corporate tax credit up to $15,000 for
contributions to public education entities, or to charitable
organizations which offer tuition assistance, or up to $75 for
expenses incurred by school personnel and parents who educate their
children at home.

SUMMARY OF SPECIFIC PROVISIONS:
This bill would permit individual
public schools, including charter schools, to accept and receive
voluntary cash contributions. It also amends section 606 of the tax
law to define a Alone; education fund as a charitable organization
in this state that is exempt from federal taxation under section
501(0)(3) of the Internal Revenue Code and is established for the
specific purpose of supporting public education within a specific
public school district; a school tuition organization as a
charitable organization in this state that is exempt from federal
taxation under section 501(C)(3) of the Internal Revenue Code,
allocates at least eighty-seven percent of its annual expenditures
for financial assistance to students in order that they may attend an
eligible non-public school, and provides such assistance to students
in more than one such school. It adds subsections to section 606 to
allow a 60% personal tax credit up to $6,000 in any taxable year for
voluntary cash contributions to public education entities, or to
school tuition organizations, or up to $75 for the purchase of
instructional materials and classroom supplies for schools or
non-public home-based instruction. Contributions to local education
funds or to school tuition organizations may not be designated
for the direct benefit of any particular student. It would also add a
subsection to section 210 of the tax law to allow a 60% business tax
credit up to 515,000 for cash contributions to public education
entities or to local education funds, or to school tuition
organizations. The bill further provides a formula by which
high-wealth public school districts share a portion of their
contributions with low-wealth districts. A subsection is also added
to section 171 of the tax law to establish an annual limit of two
hundred million dollars for such credits. Contributions exceeding this
limit shall be applied to the following tax year and the donor so
notified.

JUSTIFICATION:
At a time when the state is considering ways of
reducing the tax burden for New York State residents and educators
are seeking an expansion of financial resources, charitable giving
for educational purposes should be stimulated. permitting public
education entities such as school districts and individual public
schools, including charter schools, to accept and receive voluntary
cash contributions will lessen the need for additional tax revenue;


encouraging voluntary support for education, without prejudice for or
against any state-sponsored educational enterprise. The bill promotes
the state's interest in providing the highest quality education to
all children in the state.
Requiring a sharing of resources among school districts will insure a
more equitable distribution of financial support. The tax credit does
not constitute public aid to non-public sectarian institutions.
Permitting school personnel to claim a credit for the purchase of
classroom instructional materials and supplies will insure a wider
availability of such materials and supplies for all students.

PRIOR LEGISLATIVE HISTORY:
2022: A.5081 Referred to Ways and Means;
S.2732 Passed Senate;
2009-2010: Similar to A.10862 - Died in Ways
and Means. Similar to S.5146 - Died in Finance.

FISCAL IMPLICATIONS:
The Department of Taxation & Finance has yet to
project a first-year revenue reduction. However, as it would affect
only the Fourth Quarter of FY 2011-12, it would be less than the $200
million allowed when fully implemented. Since the bill allows only a
partial credit, it has the potential to generate $333 million in
voluntary contributions to support K-12 education in New York state,
Stabilizing the independent and religious sector will significantly
lessen the need for local school tax increases as well as for the
issuance of bonds for new public school construction, generating
further savings for the state.

EFFECTIVE DATE:
This act shall take effect on the first day of January
next succeeding the date on which it shall have become a law.

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

                                 2732--A

                       2011-2012 Regular Sessions

                            I N  S E N A T E

                            January 31, 2011
                               ___________

Introduced  by  Sens. GOLDEN, GRISANTI, HANNON, MARTINS, MAZIARZ -- read
  twice and ordered printed, and when printed to  be  committed  to  the
  Committee  on  Investigations and Government Operations -- recommitted
  to the  Committee  on  Investigations  and  Government  Operations  in
  accordance  with  Senate  Rule 6, sec. 8 -- committee discharged, bill
  amended, ordered reprinted as amended and recommitted to said  commit-
  tee

AN  ACT  to  amend  the  tax law, in relation to enacting the "education
  investment incentives act"

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

  Section  1.  Short  title. This act shall be known and may be cited as
the "education investment incentives act".
  S 2. Legislative findings and intent. The legislature hereby finds and
declares that:
  a. At a time when the state is considering ways of  reducing  the  tax
burden  for New York state residents and educators are seeking an expan-
sion of financial resources, charitable giving for educational  purposes
should be stimulated;
  b.  Permitting  public education entities such as school districts and
individual public schools, including  charter  schools,  to  accept  and
receive voluntary cash contributions will lessen the need for additional
tax revenue;
  c.  Encouraging voluntary support for education, without prejudice for
or against any state-sanctioned  educational  enterprise,  promotes  the
state's interest in providing the highest quality education to all chil-
dren in the state;
  d. Requiring a sharing of resources among school districts will insure
a more equitable distribution of financial support;
  e.  The  tax credit provided in this act is merely one of many credits
available to New York taxpayers;

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD05643-03-2

S. 2732--A                          2

  f. The intended beneficiaries of the tax credit provided in  this  act
are  the  students who attend public schools, including charter schools,
or who further their educations using tuition scholarships  from  educa-
tional  scholarship  organizations,  or  who  participate  in home-based
educational  programs;  therefore  the  tax  credit  does not constitute
public aid to non-public sectarian institutions;
  g. Permitting school personnel to claim a credit for the  purchase  of
classroom  instructional  materials  and  supplies  will  insure a wider
availability of such materials and supplies for all students.
  S 3. Section 606 of  the  tax  law  is  amended  by  adding  five  new
subsections (u), (v), (w), (w-1) and (w-2) to read as follows:
  (U)  DEFINITIONS.  AS USED IN SUBSECTIONS (V), (W), (W-1) AND (W-2) OF
THIS SECTION, THE FOLLOWING TERMS SHALL HAVE THE FOLLOWING MEANINGS:
  (1) "PUBLIC EDUCATION ENTITY" SHALL MEAN ANY PUBLIC SCHOOL DISTRICT OR
ANY INDIVIDUAL PUBLIC SCHOOL, INCLUDING ANY CHARTER SCHOOL.
  (2) "LOCAL EDUCATION FUND" SHALL MEAN  A  CHARITABLE  ORGANIZATION  IN
THIS STATE THAT:
  (A)  IS  EXEMPT  FROM FEDERAL TAXATION UNDER SECTION 501 (C)(3) OF THE
INTERNAL REVENUE CODE; AND
  (B) IS ESTABLISHED FOR  THE  EXPLICIT  PURPOSE  OF  SUPPORTING  PUBLIC
EDUCATION WITHIN A SPECIFIC PUBLIC SCHOOL DISTRICT.
  (3)  "EDUCATIONAL  SCHOLARSHIP  ORGANIZATION"  SHALL MEAN A CHARITABLE
ORGANIZATION IN THIS STATE THAT:
  (A) IS EXEMPT FROM FEDERAL TAXATION UNDER SECTION 501  (C)(3)  OF  THE
INTERNAL REVENUE CODE; AND
  (B) ALLOCATES AT LEAST EIGHTY-SEVEN PERCENT OF ITS ANNUAL EXPENDITURES
FOR EDUCATIONAL SCHOLARSHIPS OR TUITION GRANTS TO CHILDREN ALLOWING THEM
TO ATTEND ANY ELIGIBLE RELIGIOUS OR INDEPENDENT SCHOOL AND/OR TO RECEIVE
TUTORING  AND MENTORING SERVICES IN AN ELIGIBLE RELIGIOUS OR INDEPENDENT
SCHOOL, OR FOR OTHER EDUCATIONAL PURPOSES; AND
  (C) MAKES EDUCATIONAL SCHOLARSHIPS, WHICH MAY INCLUDE SCHOLARSHIPS FOR
TUTORING AND MENTORING SERVICES, OR TUITION GRANTS AVAILABLE TO CHILDREN
FROM MORE THAN ONE PUBLIC OR ELIGIBLE RELIGIOUS OR  INDEPENDENT  SCHOOL;
AND
  (D)  REPORTS  ANNUALLY  TO THE DEPARTMENT THE GROSS RECEIPTS AND GROSS
AMOUNT EXPENDED FOR SCHOLARSHIPS AND TUITION GRANTS, MENTORING SERVICES,
AND OTHER EDUCATIONAL PURPOSES.
  (4) "ELIGIBLE RELIGIOUS OR INDEPENDENT SCHOOL" SHALL  MEAN  ANY  RELI-
GIOUS OR INDEPENDENT PRIMARY OR SECONDARY SCHOOL THAT IS LOCATED IN THIS
STATE,  THAT  SATISFIES  THE  REQUIREMENTS  PRESCRIBED  BY  LAW FOR SUCH
SCHOOLS IN THIS STATE, AND THAT HAS QUALIFIED FOR FEDERAL TAX  EXEMPTION
UNDER SECTION 501 (C)(3) OF THE INTERNAL REVENUE CODE.
  (5)  "AUTHORIZED  CERTIFICATE  OF  RECEIPT"  SHALL  MEAN A CERTIFICATE
DESIGNED BY THE COMMISSIONER FOR THE PURPOSE OF ACKNOWLEDGING RECEIPT OF
A CHARITABLE CONTRIBUTION BY THE CHIEF EXECUTIVE  OFFICER  OF  A  PUBLIC
EDUCATION  ENTITY,  OR  OF  A  LOCAL EDUCATION FUND OR OF AN EDUCATIONAL
SCHOLARSHIP ORGANIZATION.
  (V) CONTRIBUTIONS TO PUBLIC EDUCATION CREDIT. FOR TAXABLE YEARS BEGIN-
NING ON OR AFTER JANUARY FIRST,  TWO  THOUSAND  THIRTEEN,  A  CREDIT  IS
ALLOWED  AGAINST  THE  TAX  IMPOSED  BY  THIS ARTICLE FOR VOLUNTARY CASH
CONTRIBUTIONS MADE BY THE TAXPAYER DURING THE TAXABLE YEAR TO  A  PUBLIC
EDUCATION ENTITY. ACCEPTANCE AND RECEIPT OF ALL SUCH CONTRIBUTIONS SHALL
BE  PERMITTED.  A  TAXPAYER  WHO  SUBMITS  WITH HIS OR HER TAX RETURN AN
AUTHORIZED CERTIFICATE OF RECEIPT SHALL  BE  ALLOWED  A  CREDIT,  TO  BE
COMPUTED  AS HEREINAFTER PROVIDED, AGAINST THE TAX IMPOSED BY THIS ARTI-
CLE.

S. 2732--A                          3

  (1) THE AMOUNT OF THE CREDIT.
  (A)  THIS  CREDIT  SHALL  BE  VALUED AT SIXTY PERCENT OF SUCH CONTRIB-
UTIONS, NOT TO EXCEED SIX THOUSAND DOLLARS IN ANY TAXABLE YEAR.
  (B) A SHAREHOLDER OF A NEW YORK S CORPORATION OR A PARTNER OF A  PART-
NERSHIP  (OR  OTHER  ENTITY  TREATED  AS  A  PARTNERSHIP  FOR INCOME TAX
PURPOSES) SHALL BE TREATED AS THE TAXPAYER WITH RESPECT TO  HIS  OR  HER
PRO-RATA  SHARE  OF  THE  TAX  CREDIT ALLOWABLE TO SUCH S CORPORATION OR
PARTNERSHIP, DETERMINED FOR THE S CORPORATION'S OR PARTNERSHIP'S TAXABLE
YEAR ENDING WITH OR WITHIN THE SHAREHOLDER'S OR PARTNER'S TAXABLE  YEAR.
THE  MAXIMUM  AMOUNT OF THE CREDIT FOR SUCH S CORPORATION OR PARTNERSHIP
SHALL BE THE SAME AS THAT ALLOWABLE TO CORPORATIONS  UNDER  SUBDIVISIONS
FORTY-SIX AND FORTY-SEVEN OF SECTION TWO HUNDRED TEN OF THIS CHAPTER.
  (2) A HUSBAND AND WIFE WHO FILE SEPARATE RETURNS FOR A TAXABLE YEAR IN
WHICH  THEY COULD HAVE FILED A JOINT RETURN MAY EACH CLAIM ONLY ONE-HALF
OF THE TAX CREDIT THAT WOULD HAVE BEEN ALLOWED FOR A JOINT RETURN.
  (3) IF THE ALLOWABLE TAX CREDIT EXCEEDS THE TAXES OTHERWISE DUE  UNDER
THIS  ARTICLE  ON  THE  TAXPAYER'S  INCOME, OR IF THERE ARE NO TAXES DUE
UNDER THIS ARTICLE, THE TAXPAYER MAY CARRY THE AMOUNT OF THE CREDIT  NOT
USED  TO  OFFSET  THE TAXES UNDER THIS ARTICLE FORWARD FOR NOT MORE THAN
FIVE YEARS INCOME TAX LIABILITY.
  (4) CONTRIBUTIONS OF TEN THOUSAND DOLLARS OR LESS IN ANY TAXABLE  YEAR
SHALL  NOT BE CONSIDERED ELIGIBLE DEDUCTIONS AS ALLOWED UNDER THIS ARTI-
CLE FOR CHARITABLE CONTRIBUTIONS. CONTRIBUTIONS IN EXCESS OF  TEN  THOU-
SAND DOLLARS IN ANY TAXABLE YEAR SHALL BE CONSIDERED ELIGIBLE DEDUCTIONS
AS ALLOWED UNDER THIS ARTICLE FOR CHARITABLE CONTRIBUTIONS.
  (5) SUCH CONTRIBUTIONS SHALL BE DEPOSITED IN A SEPARATE ACCOUNT.
  (6)  IF  MADE  TO A PUBLIC SCHOOL DISTRICT SUCH CONTRIBUTIONS SHALL BE
SUPERVISED BY A PERSON SO DESIGNATED BY THE  CHANCELLOR  OR  SUPERINTEN-
DENT.  IF  MADE  TO  A PARTICULAR SCHOOL THEY SHALL BE SUPERVISED BY THE
SCHOOL PRINCIPAL. REPORTS OF DEPOSITS AND DISBURSEMENTS SHALL BE MADE TO
THE LOCAL BOARD OF EDUCATION ANNUALLY. CHARTER SCHOOLS SHALL  MAKE  SUCH
REPORTS TO THE STATE EDUCATION DEPARTMENT.
  (W)  CONTRIBUTIONS TO LOCAL EDUCATION FUND CREDIT. IN LIEU OF CONTRIB-
UTIONS IN SUBSECTION (V) OF THIS SECTION, A CREDIT IS ALLOWED:
  (1) FOR THE AMOUNT OF VOLUNTARY CASH CONTRIBUTIONS MADE BY THE TAXPAY-
ER DURING THE TAXABLE YEAR TO A LOCAL EDUCATION  FUND.  A  TAXPAYER  WHO
SUBMITS  WITH HIS OR HER TAX RETURN AN AUTHORIZED CERTIFICATE OF RECEIPT
SHALL BE ALLOWED A CREDIT,  TO  BE  COMPUTED  AS  HEREINAFTER  PROVIDED,
AGAINST THE TAX IMPOSED BY THIS ARTICLE.
  (A)  THIS  CREDIT  SHALL  BE  VALUED AT SIXTY PERCENT OF SUCH CONTRIB-
UTIONS, NOT TO EXCEED SIX THOUSAND DOLLARS IN ANY TAXABLE YEAR. A SHARE-
HOLDER OF A NEW YORK S CORPORATION OR A PARTNER  OF  A  PARTNERSHIP  (OR
OTHER  ENTITY TREATED AS A PARTNERSHIP FOR INCOME TAX PURPOSES) SHALL BE
TREATED AS THE TAXPAYER WITH RESPECT TO HIS OR HER PRO-RATA SHARE OF THE
TAX CREDIT ALLOWABLE TO SUCH S CORPORATION  OR  PARTNERSHIP,  DETERMINED
FOR  THE  S  CORPORATION'S  OR PARTNERSHIP'S TAXABLE YEAR ENDING WITH OR
WITHIN THE SHAREHOLDER'S OR PARTNER'S TAXABLE YEAR. THE  MAXIMUM  AMOUNT
OF THE CREDIT FOR SUCH S CORPORATION OR PARTNERSHIP SHALL BE THE SAME AS
THAT   ALLOWABLE   TO  CORPORATIONS  UNDER  SUBDIVISIONS  FORTY-SIX  AND
FORTY-SEVEN OF SECTION TWO HUNDRED TEN OF THIS CHAPTER.
  (B) A HUSBAND AND WIFE WHO FILE SEPARATE RETURNS FOR A TAXABLE YEAR IN
WHICH THEY COULD HAVE FILED A JOINT RETURN MAY EACH CLAIM ONLY  ONE-HALF
OF THE TAX CREDIT THAT WOULD HAVE BEEN ALLOWED FOR A JOINT RETURN.
  (C)  IF THE ALLOWABLE TAX CREDIT EXCEEDS THE TAXES OTHERWISE DUE UNDER
THIS ARTICLE ON THE TAXPAYER'S INCOME, OR IF THERE ARE TAXES  DUE  UNDER
THIS  ARTICLE,  THE TAXPAYER MAY CARRY THE AMOUNT OF THE CREDIT NOT USED

S. 2732--A                          4

TO OFFSET THE TAXES UNDER THIS ARTICLE FORWARD FOR NOT  MORE  THAN  FIVE
YEARS' INCOME TAX LIABILITY.
  (D)  CONTRIBUTIONS  IN  EXCESS  OF TEN THOUSAND DOLLARS IN ANY TAXABLE
YEAR SHALL BE CONSIDERED ELIGIBLE DEDUCTIONS AS ALLOWED UNDER THIS ARTI-
CLE FOR CHARITABLE CONTRIBUTIONS.
  (E) THIS TAX CREDIT MAY NOT BE CLAIMED FOR ANY CONTRIBUTION TO A LOCAL
EDUCATION FUND FOR THE BENEFIT OF A DESIGNATED STUDENT.
  (2) FOR THE AMOUNT OF VOLUNTARY CASH CONTRIBUTIONS MADE BY THE TAXPAY-
ER DURING THE TAXABLE YEAR TO AN EDUCATIONAL SCHOLARSHIP ORGANIZATION. A
TAXPAYER WHO SUBMITS WITH HIS OR HER TAX RETURN  AN  AUTHORIZED  CERTIF-
ICATE OF RECEIPT SHALL BE ALLOWED A CREDIT, TO BE COMPUTED AS HEREINAFT-
ER PROVIDED, AGAINST THE TAX IMPOSED BY THIS ARTICLE.
  (A)  THIS  CREDIT  SHALL  BE  VALUED AT SIXTY PERCENT OF SUCH CONTRIB-
UTIONS, NOT TO EXCEED SIX THOUSAND DOLLARS IN ANY TAXABLE YEAR. A SHARE-
HOLDER OF A NEW YORK S CORPORATION OR A PARTNER  OF  A  PARTNERSHIP  (OR
OTHER  ENTITY TREATED AS A PARTNERSHIP FOR INCOME TAX PURPOSES) SHALL BE
TREATED AS THE TAXPAYER WITH RESPECT TO HIS OR HER PRO-RATA SHARE OF THE
TAX CREDIT ALLOWABLE TO SUCH S CORPORATION  OR  PARTNERSHIP,  DETERMINED
FOR  THE  S  CORPORATION'S  OR PARTNERSHIP'S TAXABLE YEAR ENDING WITH OR
WITHIN THE SHAREHOLDER'S OR PARTNER'S TAXABLE YEAR. THE  MAXIMUM  AMOUNT
OF THE CREDIT FOR SUCH S CORPORATION OR PARTNERSHIP SHALL BE THE SAME AS
THAT   ALLOWABLE   TO  CORPORATIONS  UNDER  SUBDIVISIONS  FORTY-SIX  AND
FORTY-SEVEN OF SECTION TWO HUNDRED TEN OF THIS CHAPTER.
  (B) A HUSBAND AND WIFE WHO FILE SEPARATE RETURNS FOR A TAXABLE YEAR IN
WHICH THEY COULD HAVE FILED A JOINT RETURN MAY EACH CLAIM ONLY  ONE-HALF
OF THE TAX CREDIT THAT WOULD HAVE BEEN ALLOWED FOR A JOINT RETURN.
  (C)  IF THE ALLOWABLE TAX CREDIT EXCEEDS THE TAXES OTHERWISE DUE UNDER
THIS ARTICLE ON THE TAXPAYER'S INCOME, OR IF  THERE  ARE  NO  TAXES  DUE
UNDER  THIS ARTICLE, THE TAXPAYER MAY CARRY THE AMOUNT OF THE CREDIT NOT
USED TO OFFSET THE TAXES UNDER THIS ARTICLE FORWARD FOR  NOT  MORE  THAN
FIVE YEARS' INCOME TAX LIABILITY.
  (D)  CONTRIBUTIONS  IN  EXCESS  OF TEN THOUSAND DOLLARS IN ANY TAXABLE
YEAR SHALL BE CONSIDERED ELIGIBLE DEDUCTIONS AS ALLOWED UNDER THIS ARTI-
CLE FOR CHARITABLE CONTRIBUTIONS.
  (E) THIS TAX CREDIT MAY NOT BE CLAIMED  FOR  ANY  CONTRIBUTION  TO  AN
EDUCATIONAL  SCHOLARSHIP  ORGANIZATION  FOR  THE BENEFIT OF A DESIGNATED
STUDENT.
  (W-1) HOME-BASED INSTRUCTIONAL MATERIALS CREDIT. IN LIEU  OF  CONTRIB-
UTIONS  IN  SUBSECTIONS (V) AND (W) OF THIS SECTION, A CREDIT IS ALLOWED
FOR THE PURCHASE OF INSTRUCTIONAL MATERIALS  FOR  NON-PUBLIC  HOME-BASED
EDUCATIONAL  PROGRAMS.  THIS  CREDIT SHALL BE VALUED AT SIXTY PERCENT OF
SUCH PURCHASES.
  (1) THE AMOUNT OF SUCH CREDIT SHALL NOT EXCEED SEVENTY-FIVE DOLLARS IN
ANY TAXABLE YEAR.
  (2) A HUSBAND AND WIFE WHO FILE SEPARATE RETURNS FOR A TAXABLE YEAR IN
WHICH THEY COULD HAVE FILED A JOINT RETURN MAY EACH CLAIM ONLY  ONE-HALF
OF THE TAX CREDIT THAT WOULD HAVE BEEN ALLOWED FOR A JOINT RETURN.
  (3)  IF THE ALLOWABLE TAX CREDIT EXCEEDS THE TAXES OTHERWISE DUE UNDER
THIS ARTICLE ON THE TAXPAYER'S INCOME, OR IF  THERE  ARE  NO  TAXES  DUE
UNDER  THIS ARTICLE, THE TAXPAYER MAY CARRY THE AMOUNT OF THE CREDIT NOT
USED TO OFFSET THE TAXES UNDER THIS ARTICLE FORWARD FOR  NOT  MORE  THAN
FIVE YEARS' INCOME TAX LIABILITY.
  (4) IF THE TAXPAYER SHALL BE RESPONSIBLE FOR NOTIFYING THE COMMISSION-
ER  OF THE INTENTION TO CLAIM THE ALLOWABLE CREDIT, NO LATER THAN DECEM-
BER THIRTY-FIRST.

S. 2732--A                          5

  (W-2) CLASSROOM INSTRUCTIONAL MATERIALS AND SUPPLIES CREDIT. A  CREDIT
IS  ALLOWED  FOR  THE  PURCHASE OF CLASSROOM INSTRUCTIONAL MATERIALS AND
SUPPLIES FOR PERSONNEL EMPLOYED IN  ANY  PUBLIC  SCHOOL,  INCLUDING  ANY
CHARTER SCHOOL, OR IN ANY ELIGIBLE RELIGIOUS OR INDEPENDENT SCHOOL.
  (1)  THIS  CREDIT  SHALL BE VALUED AT SIXTY PERCENT OF SUCH PURCHASES.
THE AMOUNT OF SUCH CREDIT SHALL NOT EXCEED SEVENTY-FIVE DOLLARS  IN  ANY
TAXABLE YEAR.
  (2)  THE  TAXPAYER SHALL BE RESPONSIBLE FOR NOTIFYING THE COMMISSIONER
OF THE INTENTION TO CLAIM THE ALLOWABLE CREDIT, NO LATER  THAN  DECEMBER
THIRTY-FIRST,  INDICATING  WHETHER  THE  PURCHASE  WAS MADE FOR USE IN A
PUBLIC SCHOOL, INCLUDING A CHARTER SCHOOL, OR AN ELIGIBLE  RELIGIOUS  OR
INDEPENDENT SCHOOL.
  S 4. Section 210 of the tax law is amended by adding four new subdivi-
sions 45, 46, 47 and 48 to read as follows:
  45.  DEFINITIONS. AS USED IN SUBDIVISIONS FORTY-SIX AND FORTY-SEVEN OF
THIS SECTION THE FOLLOWING TERMS SHALL HAVE THE FOLLOWING MEANINGS:
  (A) "PUBLIC EDUCATION ENTITY" SHALL MEAN ANY PUBLIC SCHOOL DISTRICT OR
ANY INDIVIDUAL PUBLIC SCHOOL, INCLUDING ANY CHARTER SCHOOL.
  (B) "LOCAL EDUCATION FUND" SHALL MEAN  A  CHARITABLE  ORGANIZATION  IN
THIS STATE THAT:
  (1)  IS  EXEMPT  FROM FEDERAL TAXATION UNDER SECTION 501(C) (3) OF THE
INTERNAL REVENUE CODE; AND
  (2) IS ESTABLISHED FOR  THE  EXPLICIT  PURPOSE  OF  SUPPORTING  PUBLIC
EDUCATION WITHIN A SPECIFIC PUBLIC SCHOOL DISTRICT; AND
  (3)  REPORTS  ANNUALLY  TO THE DEPARTMENT THE GROSS RECEIPTS AND GROSS
AMOUNT EXPENDED IN SUPPORT OF PUBLIC EDUCATION.
  (C) "EDUCATIONAL SCHOLARSHIP ORGANIZATION"  SHALL  MEAN  A  CHARITABLE
ORGANIZATION IN THIS STATE THAT:
  (1)  IS  EXEMPT  FROM  FEDERAL TAXATION UNDER SECTION 501(C)(3) OF THE
INTERNAL REVENUE CODE; AND
  (2) ALLOCATES AT LEAST EIGHTY-SEVEN PERCENT OF ITS ANNUAL EXPENDITURES
FOR EDUCATIONS SCHOLARSHIPS OR TUITION GRANTS TO CHILDREN ALLOWING  THEM
TO ATTEND ANY ELIGIBLE RELIGIOUS OR INDEPENDENT SCHOOL AND/OR TO RECEIVE
TUTORING  AND MENTORING SERVICES IN AN ELIGIBLE RELIGIOUS OR INDEPENDENT
SCHOOL, OR FOR OTHER EDUCATIONAL PURPOSES; AND
  (3) MAKES EDUCATIONAL SCHOLARSHIPS, WHICH MAY INCLUDE SCHOLARSHIPS FOR
TUTORING AND MENTORING SERVICES, OR TUITION GRANTS AVAILABLE TO CHILDREN
FROM MORE THAN ONE PUBLIC OR ELIGIBLE RELIGIOUS OR  INDEPENDENT  SCHOOL;
AND
  (4)  REPORTS  ANNUALLY  TO THE DEPARTMENT THE GROSS RECEIPTS AND GROSS
AMOUNT EXPENDED FOR SCHOLARSHIPS AND TUITION GRANTS.
  (D) "ELIGIBLE RELIGIOUS OR INDEPENDENT SCHOOL" SHALL  MEAN  ANY  RELI-
GIOUS OR INDEPENDENT PRIMARY OR SECONDARY SCHOOL THAT IS LOCATED IN THIS
STATE,  THAT  SATISFIES  THE  REQUIREMENTS  PRESCRIBED  BY  LAW FOR SUCH
SCHOOLS IN THIS STATE, AND THAT HAS QUALIFIED FOR FEDERAL TAX  EXEMPTION
UNDER SECTION 501(C)(3) OF THE INTERNAL REVENUE CODE.
  (E)  "AUTHORIZED  CERTIFICATE  OF  RECEIPT"  SHALL  MEAN A CERTIFICATE
DESIGNED BY THE COMMISSIONER FOR THE PURPOSE OF ACKNOWLEDGING RECEIPT OF
A CHARITABLE CONTRIBUTION BY THE CHIEF EXECUTIVE  OFFICER  OF  A  PUBLIC
EDUCATION  ENTITY,  OR  OF  A  LOCAL EDUCATION FUND OR OF AN EDUCATIONAL
SCHOLARSHIP ORGANIZATION.
  46. CONTRIBUTIONS TO PUBLIC EDUCATION CREDIT. (A)  FOR  TAXABLE  YEARS
BEGINNING  ON OR AFTER JANUARY FIRST, TWO THOUSAND THIRTEEN, A CREDIT IS
ALLOWED AGAINST THE TAX IMPOSED  BY  THIS  ARTICLE  FOR  VOLUNTARY  CASH
CONTRIBUTIONS  MADE  BY THE TAXPAYER DURING THE TAXABLE YEAR TO A PUBLIC
EDUCATION ENTITY. ACCEPTANCE AND RECEIPT OF ALL SUCH CONTRIBUTIONS SHALL

S. 2732--A                          6

BE PERMITTED. A TAXPAYER WHO SUBMITS WITH HIS OR HER TAX CREDIT,  TO  BE
COMPUTED  AS HEREINAFTER PROVIDED, AGAINST THE TAX IMPOSED BY THIS ARTI-
CLE. THIS CREDIT SHALL BE VALUED AT SIXTY PERCENT OF SUCH CONTRIBUTIONS,
NOT TO EXCEED FIFTEEN THOUSAND DOLLARS IN ANY TAXABLE YEAR.
  (B) SUCH CONTRIBUTIONS SHALL BE DEPOSITED IN A SEPARATE ACCOUNT.
  (C)  IF  MADE  TO A PUBLIC SCHOOL DISTRICT SUCH CONTRIBUTIONS SHALL BE
SUPERVISED BY A PERSON SO DESIGNATED BY THE  CHANCELLOR  OR  SUPERINTEN-
DENT.  IF  MADE  TO  A PARTICULAR SCHOOL THEY SHALL BE SUPERVISED BY THE
SCHOOL PRINCIPAL. REPORTS OF DEPOSITS AND DISBURSEMENTS SHALL BE MADE TO
THE LOCAL BOARD OF EDUCATION ANNUALLY. CHARTER SCHOOLS SHALL  MAKE  SUCH
REPORTS TO THE STATE EDUCATION DEPARTMENT.
  47.  CONTRIBUTIONS TO LOCAL EDUCATION FUND CREDIT. IN LIEU OF CONTRIB-
UTIONS IN SUBDIVISION FORTY-SIX OF THIS SECTION, A CREDIT IS ALLOWED:
  (A) FOR THE AMOUNT OF VOLUNTARY CASH CONTRIBUTIONS MADE BY THE TAXPAY-
ER DURING THE TAXABLE YEAR TO A LOCAL EDUCATION  FUND.  A  TAXPAYER  WHO
SUBMITS  WITH HIS OR HER TAX RETURN AN AUTHORIZED CERTIFICATE OF RECEIPT
SHALL BE ALLOWED A CREDIT,  TO  BE  COMPUTED  AS  HEREINAFTER  PROVIDED,
AGAINST THE TAX IMPOSED BY THIS ARTICLE.
  (1) THE AMOUNT OF SUCH CREDIT SHALL BE VALUED AT SIXTY PERCENT OF SUCH
CONTRIBUTIONS,  NOT  TO  EXCEED  FIFTEEN THOUSAND DOLLARS IN ANY TAXABLE
YEAR.
  (2) THIS TAX CREDIT MAY NOT BE CLAIMED FOR ANY CONTRIBUTION TO A LOCAL
EDUCATION FUND FOR THE BENEFIT OF A DESIGNATED STUDENT.
  (B) FOR THE AMOUNT OF VOLUNTARY CASH CONTRIBUTIONS MADE BY THE TAXPAY-
ER DURING THE TAXABLE YEAR TO AN EDUCATIONAL SCHOLARSHIP ORGANIZATION. A
TAXPAYER WHO SUBMITS WITH HIS OR HER TAX RETURN  AN  AUTHORIZED  CERTIF-
ICATE OF RECEIPT SHALL BE ALLOWED A CREDIT, TO BE COMPUTED AS HEREINAFT-
ER PROVIDED, AGAINST THE TAX IMPOSED BY THIS ARTICLE.
  (1) THE AMOUNT OF SUCH CREDIT SHALL BE VALUED AT SIXTY PERCENT OF SUCH
CONTRIBUTIONS,  NOT  TO  EXCEED  FIFTEEN THOUSAND DOLLARS IN ANY TAXABLE
YEAR.
  (2) THIS TAX CREDIT MAY NOT BE CLAIMED  FOR  ANY  CONTRIBUTION  TO  AN
EDUCATIONAL  SCHOLARSHIP  ORGANIZATION  FOR  THE BENEFIT OF A DESIGNATED
STUDENT.
  48. SCHOOL DISTRICTS RECEIVING CONTRIBUTIONS IN EXCESS OF ONE  PERCENT
OF  THEIR PREVIOUS YEAR'S BUDGET SHALL BE REQUIRED TO REMIT A MINIMUM OF
THIRTY-FIVE PERCENT OF ANY SUCH EXCESS AMOUNT TO A FUND ADMINISTERED  BY
THE  COMMISSIONER,  TO BE DISTRIBUTED TO SCHOOL DISTRICTS RECEIVING LESS
THAN ONE-HALF OF ONE PERCENT OF THEIR PREVIOUS YEAR'S BUDGET.   CONTRIB-
UTIONS TO SCHOOL DISTRICTS, TO INDIVIDUAL SCHOOLS (NOT INCLUDING CHARTER
SCHOOLS)  AND  TO  LOCAL  EDUCATION  FUNDS  SHALL  BE AGGREGATED FOR THE
PURPOSES OF THIS SECTION. SUCH PAYMENTS SHALL BE CALCULATED ON A  CALEN-
DAR  YEAR  BASIS  AND  SHALL  BE  MADE  NO LATER THAN MARCH FIRST OF THE
FOLLOWING YEAR.
  S 5. Section 171 of the tax law is amended by adding a new subdivision
twenty-ninth to read as follows:
  TWENTY-NINTH. FOR  THE  PURPOSE  OF  IMPLEMENTING  THE  PROVISIONS  OF
SUBSECTIONS  (U),  (V),  (W), (W-1) AND (W-2) OF SECTION SIX HUNDRED SIX
AND SUBDIVISIONS FORTY-FIVE, FORTY-SIX, FORTY-SEVEN AND  FORTY-EIGHT  OF
SECTION TWO HUNDRED TEN OF THIS CHAPTER THE COMMISSIONER SHALL:
  (1)  REGISTER  PUBLIC  SCHOOL  DISTRICTS,  INDIVIDUAL  PUBLIC SCHOOLS,
INCLUDING CHARTER SCHOOLS, LOCAL EDUCATION FUNDS, AND EDUCATIONAL SCHOL-
ARSHIP ORGANIZATIONS; AND
  (2) UPON NOTIFICATION BY THE CHIEF EXECUTIVE OFFICER OF ANY  EDUCATION
ENTITY SO REGISTERED THAT A CONTRIBUTION HAS BEEN RECEIVED, SUCH NOTIFI-
CATION  BEING WITHIN ONE BUSINESS DAY OF SAID RECEIPT, RECORD THE AMOUNT

S. 2732--A                          7

AND DATE OF THE CONTRIBUTION, THE NAME AND ADDRESS OF  THE  CONTRIBUTOR;
AND
  (3)  UPON NOTIFICATION THAT A CREDIT FOR THE PURCHASE OF INSTRUCTIONAL
MATERIALS FOR NON-PUBLIC HOME-BASED  EDUCATIONAL  PROGRAMS,  RECORD  THE
AMOUNT  AND DATE OF THE NOTIFICATION, THE NAME AND ADDRESS OF THE CLAIM-
ANT; AND
  (4) UPON NOTIFICATION THAT A CREDIT FOR THE PURCHASE OF THE  CLASSROOM
INSTRUCTIONAL  MATERIALS AND SUPPLIES, RECORD THE AMOUNT AND DATE OF THE
NOTIFICATION, THE NAME AND ADDRESS OF  THE  CLAIMANT,  AND  WHETHER  THE
PURCHASE  WAS  MADE  FOR  USE  IN  A  PUBLIC SCHOOL, INCLUDING A CHARTER
SCHOOL, OR AN ELIGIBLE RELIGIOUS OR INDEPENDENT SCHOOL; AND
  (5) MAKE NO MORE THAN TWO HUNDRED MILLION DOLLARS IN CREDITS AVAILABLE
IN ANY SINGLE TAX YEAR, PROVIDED FURTHER  THAT  FIFTY  PERCENT  OF  SUCH
CREDITS  SHALL  BE  AFFORDED  TO  TAXPAYERS WHO MAKE DONATIONS TO PUBLIC
EDUCATION ENTITIES AND LOCAL EDUCATION FUNDS, AND FOR  THE  PURCHASE  OF
CLASSROOM  INSTRUCTIONAL  MATERIALS  AND  SUPPLIES  FOR  USE IN A PUBLIC
SCHOOL OR A CHARTER SCHOOL, AND THAT FIFTY PERCENT OF SUCH CREDITS SHALL
BE AFFORDED TO EDUCATION SCHOLARSHIP  ORGANIZATIONS  OR  FOR  HOME-BASED
INSTRUCTIONAL MATERIALS, AND FOR THE PURCHASE OF CLASSROOM INSTRUCTIONAL
MATERIALS  AND  SUPPLIES FOR USE IN AN ELIGIBLE RELIGIOUS OR INDEPENDENT
SCHOOL; AND
  (6) ISSUE TO TAXPAYERS ALL AUTHORIZED CERTIFICATES OF RECEIPT FOR  ALL
ELIGIBLE  CREDITS NO LATER THAN JANUARY THIRTY-FIRST FOR CREDITS CLAIMED
FOR THE PREVIOUS CALENDAR YEAR.
  S 6. Excess contributions. Contributions exceeding the allowed  annual
maximum  of  one  hundred  million dollars to public education entities,
local education funds and for the purchase  of  classroom  instructional
materials  and  supplies for use in a public school or a charter school,
or the allowed annual maximum of one hundred million dollars  to  educa-
tion  scholarship  organizations, for home-based instructional materials
and for the purchase of classroom instructional materials  and  supplies
for use in an eligible religious or independent school, shall be applied
to the following tax year, and the donor so notified within one business
day.
  S  7.  The  department of taxation and finance shall prepare a written
report before January 31 of each  calendar  year,  which  shall  contain
statistical  information  regarding  the  credits  allowed  pursuant  to
subsections (u), (v), (w), (w-1) and (w-2) of section 606  and  subdivi-
sions  45,  46,  47  and  48  of  section 210 of the tax law as added by
sections three and four of this act, for  the  previous  calendar  year.
Copies  of such report shall be submitted to the governor, the temporary
president of the senate, the speaker of the assembly, the chair  of  the
senate  finance  committee  and the chair of the assembly ways and means
committee. Such reports shall contain, but need not be limited  to,  the
number  of  credits  by  type  and the amount of such credits allowed to
taxpayers.
  S 8. This act shall take effect on the first of January next  succeed-
ing the date on which it shall have become a law.

Co-Sponsors

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S2732B - Bill Details

Current Committee:
Law Section:
Tax Law
Laws Affected:
Amd §§606, 210 & 171, Tax L
Versions Introduced in 2009-2010 Legislative Session:
S5146A

S2732B - Bill Texts

view summary

Establishes an education investment tax credit.

view sponsor memo
BILL NUMBER:S2732B

TITLE OF BILL:
An act to amend the tax law, in relation to enacting the "education
investment incentives act"

PURPOSE OR GENERAL IDEA OF BILL:
This bill would authorize a tax credit up to seventy-five percent of
either personal income tax liability or corporate franchise tax
liability for donations to public education entities, local education
funds, and educational scholarship organizations, or up to $75 for
certain expenses incurred by school personnel and parents who educate
their children at home.

SUMMARY OF SPECIFIC PROVISIONS:
Section 3 amends section 606 of the tax law for the purposes of
receiving voluntary cash contribution by defining "public education
entity"; as any public school district; an individual public school,
including a charter school; a nonprofit organization for the purpose
of providing programming for performing arts, visual arts, civic
instruction, pre-kindergarten instruction, or any other educational
purpose within such schools; a nonprofit organization that allows
donors to choose school projects for charitable support that are
identified by teachers or other school personnel; and the university
of the state of New York research fund.

"Local education fund" is defined as a charitable organization in this
state that is exempt from federal taxation under section 501(c)(3) of
the Internal Revenue Code and is established for the specific purpose
of supporting public education within a specific public school
district.

"Educational scholarship organization" is defined as a charitable
organization in this state that is exempt from federal taxation under
section 50l(c)(3) of the Internal Revenue Code, that allocates at
least ninety-percent of its donations for educational scholarships.

Section 3 limits the amount of the tax credit to seventy-five percent
of the taxpayer's tax liability, and also provides for a tax credit
for up to $75 for the purchase of instructional materials and
classroom supplies for schools by school personnel, or for non-public
home-based instruction.

Section 4 amends section 210 of the tax law by defining for the
purposes of receiving voluntary cash contributions, "public education
entity", "local education fund", and "educational scholarship
organization".

Section 5 requires approval of tax credits on a first-come,
first-served basis.

Further, section 5 disallows the portion of the credit equal to the
amount saved from the federal tax liability given a taxpayer's
donation to an IRS recognized 501(c)(3) charitable organization.


Section 5 also provides that fifty percent of the available credits be
afforded to taxpayers donating to public education entities, local
education funds, and for the purchase by school personnel for
classroom instructional material and supplies, and that fifty percent
be afforded to educational scholarship organizations and for
home-based instructional materials.

Section 6 provides for excess contributions.

Section 7 imposes reporting requirements of the department of taxation
and finance.

Section 8 restricts the commissioners of education and taxation &
finance from imposing additional regulations on educational programs
in receipt of funding from educational scholarship organizations.

Section 9 provides that this act shall take effect immediately.

JUSTIFICATION:
At a time when the state is considering ways of reducing the tax
burden for New York State residents and educators are seeking an
expansion of financial resources, charitable giving for educational
purposes should be stimulated. permitting public education entities
such as school districts and individual public schools, including
charter schools, and non-profits that promote the arts, civics, and
pre-k instruction, to accept and receive voluntary cash contributions
will lessen the need for additional tax revenue, encouraging voluntary
support for education without prejudice for or against any
state-sponsored educational enterprise. The bill promotes the state's
interest in providing the highest quality education to all children in
the state. The tax credit does not constitute public aid to non-public
sectarian institutions. Permitting school personnel to claim a credit
for the purchase of classroom instructional materials and supplies
will insure a wider availability of such materials and supplies for
all students.

PRIOR LEGISLATIVE HISTORY:
2012: A.5081 Referred to Ways and Means, S.2732 Referred to
Investigations & Government Operations
2011: Died in Assembly, Passed Senate
2009-10: Similar to A.10862 - Died in Ways and Means
Similar to S.5146 - Died in Finance

FISCAL IMPLICATIONS:

The Department of Taxation & Finance has yet to project a first-year
revenue reduction.
However, the total tax credit available is capped at $250 million for
the 2013 tax year. The total available credit increases to $300
million in 2014 tax year, and annually thereafter.

EFFECTIVE DATE:
This act shall take effect immediately.

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

                                 2732--B

                       2011-2012 Regular Sessions

                            I N  S E N A T E

                            January 31, 2011
                               ___________

Introduced by Sens. GOLDEN, GRISANTI, HANNON, HASSELL-THOMPSON, MARTINS,
  MAZIARZ  --  read  twice  and  ordered printed, and when printed to be
  committed to the Committee on Investigations and Government Operations
  -- recommitted to the Committee on Investigations and Government Oper-
  ations  in  accordance  with  Senate  Rule  6,  sec.  8  --  committee
  discharged, bill amended, ordered reprinted as amended and recommitted
  to  said  committee  --  committee  discharged,  bill amended, ordered
  reprinted as amended and recommitted to said committee

AN ACT to amend the tax law, in  relation  to  enacting  the  "education
  investment incentives act"

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

  Section 1. Short title. This act shall be known and may  be  cited  as
the "education investment incentives act".
  S 2. Legislative findings and intent. The legislature hereby finds and
declares that:
  a.  At  a  time when the state is considering ways of reducing the tax
burden for New York state residents and educators are seeking an  expan-
sion  of financial resources, charitable giving for educational purposes
should be stimulated;
  b. Permitting public education entities such as school  districts  and
individual  public  schools,  including  charter  schools, to accept and
receive voluntary cash contributions will lessen the need for additional
tax revenue;
  c. Encouraging voluntary support for education, without prejudice  for
or  against  any  state-sanctioned  educational enterprise, promotes the
state's interest in providing the highest quality education to all chil-
dren in the state;
  d. Requiring a sharing of resources among school districts will insure
a more equitable distribution of financial support;

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD05643-09-2

S. 2732--B                          2

  e. The tax credit provided in this act is merely one of  many  credits
available to New York taxpayers;
  f.  The  intended beneficiaries of the tax credit provided in this act
are the students who attend public schools, including  charter  schools,
or  who  further their educations using tuition scholarships from educa-
tional scholarship  organizations,  or  who  participate  in  home-based
educational  programs;  therefore  the  tax  credit  does not constitute
public aid to non-public sectarian institutions;
  g. Permitting school personnel to claim a credit for the  purchase  of
classroom  instructional  materials  and  supplies  will  insure a wider
availability of such materials and supplies for all students.
  S 3. Section 606  of  the  tax  law  is  amended  by  adding  six  new
subsections (u), (v), (w), (w-1), (w-2) and (w-3) to read as follows:
  (U)  DEFINITIONS.  AS  USED  IN SUBSECTIONS (V), (W), (W-1), (W-2) AND
(W-3) OF THIS SECTION, THE FOLLOWING  TERMS  SHALL  HAVE  THE  FOLLOWING
MEANINGS:
  (1) "PUBLIC EDUCATION ENTITY" SHALL MEAN ANY PUBLIC SCHOOL DISTRICT OR
ANY  INDIVIDUAL PUBLIC SCHOOL, INCLUDING ANY CHARTER SCHOOL; A NONPROFIT
ORGANIZATION FOR THE PURPOSE OF  PROVIDING  PROGRAMMING  FOR  PERFORMING
ARTS,  VISUAL  ARTS, CIVIC INSTRUCTION, PRE-KINDERGARTEN INSTRUCTION, OR
ANY OTHER EDUCATIONAL PURPOSE WITHIN SUCH SCHOOLS; A NONPROFIT ORGANIZA-
TION THAT ALLOWS DONORS TO CHOOSE SCHOOL PROJECTS FOR CHARITABLE SUPPORT
THAT ARE IDENTIFIED BY TEACHERS  OR  OTHER  SCHOOL  PERSONNEL;  AND  THE
UNIVERSITY OF THE STATE OF NEW YORK RESEARCH FUND.
  (2)  "LOCAL  EDUCATION  FUND"  SHALL MEAN A CHARITABLE ORGANIZATION IN
THIS STATE THAT:
  (A) IS EXEMPT FROM FEDERAL TAXATION UNDER SECTION 501  (C)(3)  OF  THE
INTERNAL REVENUE CODE; AND
  (B)  IS  ESTABLISHED  FOR  THE  EXPLICIT  PURPOSE OF SUPPORTING PUBLIC
EDUCATION WITHIN A SPECIFIC PUBLIC SCHOOL DISTRICT.
  (3) "EDUCATIONAL SCHOLARSHIP ORGANIZATION"  SHALL  MEAN  A  CHARITABLE
ORGANIZATION IN THIS STATE THAT:
  (A)  IS  EXEMPT  FROM FEDERAL TAXATION UNDER SECTION 501 (C)(3) OF THE
INTERNAL REVENUE CODE;
  (B) ALLOCATES AT LEAST NINETY PERCENT OF DONATIONS FOR WHICH TAX CRED-
ITS ARE CLAIMED UNDER SUBSECTION (W-3) OF THIS SECTION  FOR  EDUCATIONAL
SCHOLARSHIPS;
  (C)  MAKES  EDUCATIONAL  SCHOLARSHIPS  OR  TUITION GRANTS AVAILABLE TO
CHILDREN FROM MORE THAN ONE PUBLIC OR ELIGIBLE NON-PUBLIC SCHOOL; AND
  (D) REPORTS ANNUALLY TO THE DEPARTMENT THE GROSS  RECEIPTS  AND  GROSS
AMOUNT EXPENDED FOR SCHOLARSHIPS AND TUITION GRANTS.
  (4)  "ELIGIBLE  NON-PUBLIC SCHOOL" SHALL MEAN AN INDEPENDENT SECTARIAN
OR NON-SECTARIAN PRIMARY OR SECONDARY SCHOOL OR PRE-KINDERGARTEN PROGRAM
THAT  IS  LOCATED  IN  THIS  STATE,  THAT  SATISFIES  THE   REQUIREMENTS
PRESCRIBED  BY  APPLICABLE  LAW FOR SUCH SCHOOLS IN THIS STATE, AND THAT
HAS QUALIFIED FOR FEDERAL TAX EXEMPTION UNDER SECTION 501 (C)(3) OF  THE
INTERNAL REVENUE CODE.
  (5)  "AUTHORIZED  CERTIFICATE  OF  RECEIPT"  SHALL  MEAN A CERTIFICATE
DESIGNED BY THE COMMISSIONER FOR THE PURPOSE OF ACKNOWLEDGING RECEIPT OF
A CHARITABLE CONTRIBUTION BY THE CHIEF EXECUTIVE OFFICER  OF  AN  EDUCA-
TIONAL SCHOLARSHIP ORGANIZATION.
  (6) "ELIGIBLE PUPIL" SHALL MEAN A PUPIL WHO IS A RESIDENT OF THE STATE
OF  NEW  YORK AND OF AGE TO ATTEND SCHOOL IN ACCORDANCE WITH SUBDIVISION
ONE OF SECTION THIRTY-TWO HUNDRED TWO OF THE EDUCATION  LAW  OR  WHO  IS
FOUR  YEARS OF AGE ON OR BEFORE DECEMBER FIRST OF THE YEAR IN WHICH THEY
ARE ENROLLED IN A PRE-KINDERGARTEN PROGRAM.

S. 2732--B                          3

  (V) CONTRIBUTIONS TO PUBLIC EDUCATION CREDIT. FOR TAXABLE YEARS BEGIN-
NING ON OR AFTER JANUARY FIRST,  TWO  THOUSAND  THIRTEEN,  A  CREDIT  IS
ALLOWED FOR VOLUNTARY CASH CONTRIBUTIONS MADE BY THE TAXPAYER DURING THE
TAXABLE YEAR TO A PUBLIC EDUCATION ENTITY. ACCEPTANCE AND RECEIPT OF ALL
SUCH  CONTRIBUTIONS  SHALL BE PERMITTED. A TAXPAYER WHO SUBMITS WITH HIS
OR HER TAX RETURN AN AUTHORIZED CERTIFICATE OF RECEIPT SHALL BE  ALLOWED
A  CREDIT,  TO  BE  COMPUTED    AS HEREINAFTER PROVIDED, AGAINST THE TAX
IMPOSED BY THIS ARTICLE.
  (1) THE AMOUNT OF SUCH CREDIT SHALL BE VALUED AT ONE  HUNDRED  PERCENT
OF  THE  AMOUNT OF SUCH CONTRIBUTIONS IN ANY TAXABLE YEAR, NOT TO EXCEED
SEVENTY-FIVE PERCENT OF THE TAX DUE FROM THE TAXPAYER UNDER THIS ARTICLE
IN THE TAXABLE YEAR, AFTER APPLICATION OF ANY OTHER ALLOWABLE CREDITS BY
THE TAXPAYER.
  A SHAREHOLDER OF A NEW YORK S CORPORATION OR A PARTNER OF  A  PARTNER-
SHIP  (OR OTHER ENTITY TREATED AS A PARTNERSHIP FOR INCOME TAX PURPOSES)
SHALL BE TREATED AS THE TAXPAYER WITH RESPECT TO  HIS  OR  HER  PRO-RATA
SHARE  OF THE TAX CREDIT ALLOWABLE TO SUCH S CORPORATION OR PARTNERSHIP,
DETERMINED FOR THE S CORPORATION'S OR PARTNERSHIP'S TAXABLE YEAR  ENDING
WITH  OR WITHIN THE SHAREHOLDER'S OR PARTNER'S TAXABLE YEAR. THE MAXIMUM
AMOUNT OF THE CREDIT FOR SUCH S CORPORATION OR PARTNERSHIP SHALL BE  THE
SAME  AS  THAT  ALLOWABLE  TO CORPORATIONS UNDER SUBDIVISIONS FORTY-SIX,
FORTY-SEVEN AND FORTY-EIGHT OF SECTION TWO HUNDRED TEN OF THIS CHAPTER.
  (2) A HUSBAND AND WIFE WHO FILE SEPARATE RETURNS FOR A TAXABLE YEAR IN
WHICH THEY COULD HAVE FILED A JOINT RETURN MAY EACH CLAIM ONLY  ONE-HALF
OF THE TAX CREDIT THAT WOULD HAVE BEEN ALLOWED FOR A JOINT RETURN.
  (3)  IF  THE  ALLOWABLE TAX CREDIT EXCEEDS SEVENTY-FIVE PERCENT OF THE
TAXES OTHERWISE DUE UNDER THIS ARTICLE ON THE TAXPAYER'S INCOME,  OR  IF
THERE  ARE  NO  TAXES DUE UNDER THIS ARTICLE, THE TAXPAYER MAY CARRY THE
AMOUNT OF THE CREDIT NOT USED TO OFFSET THE  TAXES  UNDER  THIS  ARTICLE
FORWARD FOR NOT MORE THAN FIVE YEARS' INCOME TAX LIABILITY.
  (4)  CONTRIBUTIONS  IN ANY TAXABLE YEAR THAT RECEIVE A CREDIT PURSUANT
TO THIS SUBSECTION  SHALL  NOT  BE  CONSIDERED  ELIGIBLE  DEDUCTIONS  AS
ALLOWED  UNDER  THIS ARTICLE FOR CHARITABLE CONTRIBUTIONS. CONTRIBUTIONS
IN EXCESS OF SEVENTY-FIVE PERCENT OF A TAXPAYER'S TAX LIABILITY  IN  ANY
TAXABLE YEAR THAT DO NOT RECEIVE A TAX CREDIT SHALL BE CONSIDERED ELIGI-
BLE  DEDUCTIONS  AS  ALLOWED  UNDER THIS ARTICLE FOR CHARITABLE CONTRIB-
UTIONS.
  (5) SUCH CONTRIBUTIONS SHALL BE DEPOSITED IN A SEPARATE ACCOUNT.
  (6) IF MADE TO A PUBLIC SCHOOL DISTRICT SUCH  CONTRIBUTIONS  SHALL  BE
SUPERVISED  BY  A  PERSON SO DESIGNATED BY THE CHANCELLOR OR SUPERINTEN-
DENT. IF MADE TO A PARTICULAR SCHOOL THEY SHALL  BE  SUPERVISED  BY  THE
SCHOOL PRINCIPAL. REPORTS OF DEPOSITS AND DISBURSEMENTS SHALL BE MADE TO
THE  LOCAL  BOARD OF EDUCATION ANNUALLY. CHARTER SCHOOLS SHALL MAKE SUCH
REPORTS TO THE RESPECTIVE CHARTER SCHOOL BOARD OF TRUSTEES, AS  APPLICA-
BLE.
  (W)  CONTRIBUTIONS TO LOCAL EDUCATION FUND CREDIT. IN LIEU OF CONTRIB-
UTIONS IN SUBSECTION (V) OF THIS SECTION, A CREDIT IS ALLOWED FOR  TAXA-
BLE YEARS BEGINNING ON OR AFTER JANUARY FIRST, TWO THOUSAND THIRTEEN FOR
THE  AMOUNT  OF VOLUNTARY CASH CONTRIBUTIONS MADE BY THE TAXPAYER DURING
THE TAXABLE YEAR TO A LOCAL EDUCATION FUND. A TAXPAYER WHO SUBMITS  WITH
HIS  OR  HER  TAX  RETURN  AN AUTHORIZED CERTIFICATE OF RECEIPT SHALL BE
ALLOWED A CREDIT, TO BE COMPUTED AS HEREINAFTER  PROVIDED,  AGAINST  THE
TAX IMPOSED BY THIS ARTICLE.
  (1)  THE  AMOUNT OF SUCH CREDIT SHALL BE VALUED AT ONE HUNDRED PERCENT
OF THE AMOUNT OF SUCH CONTRIBUTIONS IN ANY TAXABLE YEAR, NOT  TO  EXCEED
SEVENTY-FIVE PERCENT OF THE TAX DUE FROM THE TAXPAYER UNDER THIS ARTICLE

S. 2732--B                          4

IN THE TAXABLE YEAR, AFTER APPLICATION OF ANY OTHER ALLOWABLE CREDITS BY
THE TAXPAYER.  A SHAREHOLDER OF A NEW YORK S CORPORATION OR A PARTNER OF
A  PARTNERSHIP  (OR OTHER ENTITY TREATED AS A PARTNERSHIP FOR INCOME TAX
PURPOSES)  SHALL  BE  TREATED AS THE TAXPAYER WITH RESPECT TO HIS OR HER
PRO-RATA SHARE OF THE TAX CREDIT ALLOWABLE  TO  SUCH  S  CORPORATION  OR
PARTNERSHIP, DETERMINED FOR THE S CORPORATION'S OR PARTNERSHIP'S TAXABLE
YEAR  ENDING WITH OR WITHIN THE SHAREHOLDER'S OR PARTNER'S TAXABLE YEAR.
THE MAXIMUM AMOUNT OF THE CREDIT FOR SUCH S CORPORATION  OR  PARTNERSHIP
SHALL  BE  THE SAME AS THAT ALLOWABLE TO CORPORATIONS UNDER SUBDIVISIONS
FORTY-SIX, FORTY-SEVEN AND FORTY-EIGHT OF SECTION  TWO  HUNDRED  TEN  OF
THIS CHAPTER.
  (2) A HUSBAND AND WIFE WHO FILE SEPARATE RETURNS FOR A TAXABLE YEAR IN
WHICH  THEY COULD HAVE FILED A JOINT RETURN MAY EACH CLAIM ONLY ONE-HALF
OF THE TAX CREDIT THAT WOULD HAVE BEEN ALLOWED FOR A JOINT RETURN.
  (3) IF THE ALLOWABLE TAX CREDIT EXCEEDS SEVENTY-FIVE  PERCENT  OF  THE
TAXES  OTHERWISE  DUE UNDER THIS ARTICLE ON THE TAXPAYER'S INCOME, OR IF
THERE ARE TAXES DUE UNDER THIS  ARTICLE,  THE  TAXPAYER  MAY  CARRY  THE
AMOUNT  OF  THE  CREDIT  NOT USED TO OFFSET THE TAXES UNDER THIS ARTICLE
FORWARD FOR NOT MORE THAN FIVE YEARS' INCOME TAX LIABILITY.
  (4) CONTRIBUTIONS IN ANY TAXABLE YEAR THAT RECEIVE A  CREDIT  PURSUANT
TO  THIS  SUBSECTION  SHALL BE CONSIDERED ELIGIBLE DEDUCTIONS AS ALLOWED
UNDER THIS ARTICLE FOR CHARITABLE CONTRIBUTIONS. CONTRIBUTIONS IN EXCESS
OF SEVENTY-FIVE PERCENT OF A TAXPAYERS' TAX  LIABILITY  IN  ANY  TAXABLE
YEAR  THAT  DO  NOT  RECEIVE  A  TAX CREDIT SHALL BE CONSIDERED ELIGIBLE
DEDUCTIONS AS ALLOWED UNDER THIS ARTICLE FOR CHARITABLE CONTRIBUTIONS.
  (5) THIS TAX CREDIT MAY NOT BE CLAIMED FOR ANY CONTRIBUTION TO A LOCAL
EDUCATION FUND FOR THE BENEFIT OF A DESIGNATED STUDENT.
  (W-1) HOME-BASED INSTRUCTIONAL MATERIALS CREDIT. IN LIEU  OF  CONTRIB-
UTIONS  IN  SUBSECTIONS (V) AND (W) OF THIS SECTION, A CREDIT IS ALLOWED
FOR TAXABLE YEARS BEGINNING ON OR  AFTER  JANUARY  FIRST,  TWO  THOUSAND
THIRTEEN  FOR  THE  PURCHASE  OF  INSTRUCTIONAL MATERIALS FOR NON-PUBLIC
HOME-BASED EDUCATIONAL PROGRAMS. THIS CREDIT  SHALL  BE  VALUED  AT  ONE
HUNDRED PERCENT OF SUCH PURCHASES.
  (1) THE AMOUNT OF SUCH CREDIT SHALL NOT EXCEED SEVENTY-FIVE DOLLARS IN
ANY TAXABLE YEAR.
  (2) A HUSBAND AND WIFE WHO FILE SEPARATE RETURNS FOR A TAXABLE YEAR IN
WHICH  THEY COULD HAVE FILED A JOINT RETURN MAY EACH CLAIM ONLY ONE-HALF
OF THE TAX CREDIT THAT WOULD HAVE BEEN ALLOWED FOR A JOINT RETURN.
  (3) IF THE ALLOWABLE TAX CREDIT EXCEEDS THE TAXES OTHERWISE DUE  UNDER
THIS  ARTICLE  ON  THE  TAXPAYER'S  INCOME, OR IF THERE ARE NO TAXES DUE
UNDER THIS ARTICLE, THE TAXPAYER MAY CARRY THE AMOUNT OF THE CREDIT  NOT
USED  TO  OFFSET  THE TAXES UNDER THIS ARTICLE FORWARD FOR NOT MORE THAN
FIVE YEARS' INCOME TAX LIABILITY.
  (4) IF THE TAXPAYER SHALL BE RESPONSIBLE FOR NOTIFYING THE COMMISSION-
ER OF THE INTENTION TO CLAIM THE ALLOWABLE CREDIT, NO LATER THAN  DECEM-
BER THIRTY-FIRST.
  (W-2) CLASSROOM INSTRUCTIONAL MATERIALS AND SUPPLIES CREDIT. FOR TAXA-
BLE  YEARS BEGINNING ON OR AFTER JANUARY FIRST, TWO THOUSAND THIRTEEN, A
CREDIT IS ALLOWED FOR THE  PERSONNEL  EMPLOYED  IN  ANY  PUBLIC  SCHOOL,
INCLUDING  ANY  CHARTER SCHOOL, OR IN ANY ELIGIBLE NON-PUBLIC SCHOOL FOR
THE PURCHASE OF CLASSROOM INSTRUCTIONAL MATERIALS AND SUPPLIES.
  (1) THE AMOUNT OF SUCH CREDIT SHALL NOT EXCEED SEVENTY-FIVE DOLLARS IN
ANY TAXABLE YEAR.
  (2) THE TAXPAYER SHALL BE RESPONSIBLE FOR NOTIFYING  THE  COMMISSIONER
OF  THE  INTENTION TO CLAIM THE ALLOWABLE CREDIT, NO LATER THAN DECEMBER
THIRTY-FIRST, INDICATING WHETHER THE PURCHASE WAS  MADE  FOR  USE  IN  A

S. 2732--B                          5

PUBLIC  SCHOOL,  INCLUDING  A  CHARTER SCHOOL, OR AN ELIGIBLE NON-PUBLIC
SCHOOL.
  (W-3)  CONTRIBUTIONS  TO  EDUCATIONAL SCHOLARSHIP ORGANIZATION CREDIT.
FOR TAXABLE YEARS BEGINNING ON OR  AFTER  JANUARY  FIRST,  TWO  THOUSAND
THIRTEEN,  A CREDIT IS ALLOWED FOR THE AMOUNT OF VOLUNTARY CASH CONTRIB-
UTIONS MADE BY THE TAXPAYER DURING THE TAXABLE YEAR  TO  AN  EDUCATIONAL
SCHOLARSHIP  ORGANIZATION.  A  TAXPAYER  WHO SUBMITS WITH HIS OR HER TAX
RETURN AN AUTHORIZED CERTIFICATE OF RECEIPT SHALL BE ALLOWED  A  CREDIT,
TO  BE COMPUTED AS HEREINAFTER PROVIDED, AGAINST THE TAX IMPOSED BY THIS
ARTICLE.
  (1) THE AMOUNT OF SUCH CREDIT SHALL BE VALUED AT ONE  HUNDRED  PERCENT
OF  THE  AMOUNT OF SUCH CONTRIBUTIONS IN ANY TAXABLE YEAR, NOT TO EXCEED
SEVENTY-FIVE PERCENT OF THE TAX DUE FROM THE TAXPAYER UNDER THIS ARTICLE
IN THE TAXABLE YEAR, AFTER APPLICATION OF ANY OTHER ALLOWABLE CREDITS BY
THE TAXPAYER. A SHAREHOLDER OF A NEW YORK S CORPORATION OR A PARTNER  OF
A  PARTNERSHIP  (OR OTHER ENTITY TREATED AS A PARTNERSHIP FOR INCOME TAX
PURPOSES) SHALL BE TREATED AS THE TAXPAYER WITH RESPECT TO  HIS  OR  HER
PRO-RATA  SHARE  OF  THE  TAX  CREDIT ALLOWABLE TO SUCH S CORPORATION OR
PARTNERSHIP, DETERMINED FOR THE S CORPORATION'S OR PARTNERSHIP'S TAXABLE
YEAR ENDING WITH OR WITHIN THE SHAREHOLDER'S OR PARTNER'S TAXABLE  YEAR.
THE  MAXIMUM  AMOUNT OF THE CREDIT FOR SUCH S CORPORATION OR PARTNERSHIP
SHALL BE THE SAME AS THAT ALLOWABLE TO CORPORATIONS  UNDER  SUBDIVISIONS
FORTY-SIX,  FORTY-SEVEN  AND  FORTY-EIGHT  OF SECTION TWO HUNDRED TEN OF
THIS CHAPTER.
  (2) A HUSBAND AND WIFE WHO FILE SEPARATE RETURNS FOR A TAXABLE YEAR IN
WHICH THEY COULD HAVE FILED A JOINT RETURN MAY EACH CLAIM ONLY  ONE-HALF
OF THE TAX CREDIT THAT WOULD HAVE BEEN ALLOWED FOR A JOINT RETURN.
  (3)  IF  THE  ALLOWABLE TAX CREDIT EXCEEDS SEVENTY-FIVE PERCENT OF THE
TAXES OTHERWISE DUE UNDER THIS ARTICLE ON THE TAXPAYER'S INCOME,  OR  IF
THERE  ARE  NO  TAXES DUE UNDER THIS ARTICLE, THE TAXPAYER MAY CARRY THE
AMOUNT OF CREDIT NOT USED TO OFFSET THE TAXES UNDER THIS ARTICLE FORWARD
FOR NOT MORE THAN FIVE YEARS' INCOME TAX LIABILITY.
  (4) CONTRIBUTIONS IN ANY TAXABLE YEAR THAT RECEIVE A  CREDIT  PURSUANT
TO  THIS  SUBSECTION  SHALL  NOT  BE  CONSIDERED  ELIGIBLE DEDUCTIONS AS
ALLOWED UNDER THIS ARTICLE FOR CHARITABLE  CONTRIBUTIONS.  CONTRIBUTIONS
IN  EXCESS  OF SEVENTY-FIVE PERCENT OF A TAXPAYERS' TAX LIABILITY IN ANY
TAXABLE YEAR THAT DO NOT RECEIVE A TAX CREDIT SHALL BE CONSIDERED ELIGI-
BLE DEDUCTIONS AS ALLOWED UNDER THIS  ARTICLE  FOR  CHARITABLE  CONTRIB-
UTIONS.
  (5)  THIS  TAX  CREDIT  MAY  NOT BE CLAIMED FOR ANY CONTRIBUTION TO AN
EDUCATIONAL SCHOLARSHIP ORGANIZATION FOR THE  BENEFIT  OF  A  DESIGNATED
PUPIL.
  (6) SCHOLARSHIP AMOUNT.
  (A) AN EDUCATION SCHOLARSHIP ORGANIZATION MAY AWARD A SCHOLARSHIP TO A
NON-DISTRICT  RESIDENT ELIGIBLE PUPIL ATTENDING A PUBLIC SCHOOL OPERATED
BY A SCHOOL DISTRICT IN AN AMOUNT NOT TO EXCEED THE TUITION  CHARGED  BY
THE  PARTICIPATING  PUBLIC SCHOOL PURSUANT TO PARAGRAPH D OF SUBDIVISION
FOUR OF SECTION THIRTY-TWO HUNDRED TWO OF THE EDUCATION  LAW,  PROVIDED,
HOWEVER  THAT A SCHOLARSHIP SHALL NOT BE AVAILABLE IN ANY CASE WHERE THE
RESIDENT DISTRICT OF SUCH PUPIL IS LIABLE FOR SUCH TUITION.
  (B) AN EDUCATION SCHOLARSHIP ORGANIZATION MAY AWARD AN ELIGIBLE SCHOL-
ARSHIP TO A PUPIL ENROLLED IN  A  PUBLIC  SCHOOL,  INCLUDING  A  CHARTER
SCHOOL,  OR  A  NON-PUBLIC SCHOOL IN AN AMOUNT NOT TO EXCEED THE TUITION
AMOUNT OF THE ELIGIBLE NON-PUBLIC SCHOOL, PROVIDED,  HOWEVER,  THAT  THE
TOTAL  AMOUNT  OF SUCH TAX CREDITS SHALL NOT EXCEED THE AMOUNT OF AVAIL-
ABLE TAX CREDITS FOR EDUCATIONAL SCHOLARSHIP ORGANIZATIONS SET FORTH  IN

S. 2732--B                          6

PARAGRAPH  SIX OF SUBDIVISION TWENTY-NINTH OF SECTION ONE HUNDRED SEVEN-
TY-ONE OF THIS CHAPTER.
  S 4. Section 210 of the tax law is amended by adding four new subdivi-
sions 45, 46, 47 and 48 to read as follows:
  45.  DEFINITIONS.  AS  USED IN SUBDIVISIONS FORTY-SIX, FORTY-SEVEN AND
FORTY-EIGHT OF THIS SECTION THE FOLLOWING TERMS SHALL HAVE THE FOLLOWING
MEANINGS:
  (A) "PUBLIC EDUCATION ENTITY" SHALL MEAN ANY PUBLIC SCHOOL DISTRICT OR
ANY INDIVIDUAL PUBLIC SCHOOL, INCLUDING ANY CHARTER SCHOOL; A  NONPROFIT
ORGANIZATION  FOR  THE  PURPOSE  OF PROVIDING PROGRAMMING FOR PERFORMING
ARTS, VISUAL ARTS, CIVIC INSTRUCTION, PRE-KINDERGARTEN  INSTRUCTION,  OR
ANY OTHER EDUCATIONAL PURPOSE WITHIN SUCH SCHOOLS; A NONPROFIT ORGANIZA-
TION THAT ALLOWS DONORS TO CHOOSE SCHOOL PROJECTS FOR CHARITABLE SUPPORT
THAT  ARE  IDENTIFIED  BY  TEACHERS  OR  OTHER SCHOOL PERSONNEL; AND THE
UNIVERSITY OF THE STATE OF NEW YORK RESEARCH FUND.
  (B) "LOCAL EDUCATION FUND" SHALL MEAN  A  CHARITABLE  ORGANIZATION  IN
THIS STATE THAT:
  (1)  IS  EXEMPT  FROM FEDERAL TAXATION UNDER SECTION 501(C) (3) OF THE
INTERNAL REVENUE CODE; AND
  (2) IS ESTABLISHED FOR  THE  EXPLICIT  PURPOSE  OF  SUPPORTING  PUBLIC
EDUCATION WITHIN A SPECIFIC PUBLIC SCHOOL DISTRICT.
  (C)  "EDUCATIONAL  SCHOLARSHIP  ORGANIZATION"  SHALL MEAN A CHARITABLE
ORGANIZATION IN THIS STATE THAT:
  (1) IS EXEMPT FROM FEDERAL TAXATION UNDER  SECTION  501(C)(3)  OF  THE
INTERNAL REVENUE CODE;
  (2)  ALLOCATES  AT LEAST NINETY PERCENT OF DONATIONS FOR WHICH CREDITS
ARE CLAIMED UNDER SUBDIVISION FORTY-EIGHT OF  THIS  SECTION  FOR  EDUCA-
TIONAL SCHOLARSHIPS;
  (3)  MAKES  EDUCATIONAL  SCHOLARSHIPS  OR  TUITION GRANTS AVAILABLE TO
CHILDREN FROM MORE THAN ONE PUBLIC OR ELIGIBLE NON-PUBLIC SCHOOL; AND
  (4) REPORTS ANNUALLY TO THE DEPARTMENT THE GROSS  RECEIPTS  AND  GROSS
AMOUNT EXPENDED FOR SCHOLARSHIPS AND TUITION GRANTS.
  (D)  "ELIGIBLE  NON-PUBLIC SCHOOL" SHALL MEAN AN INDEPENDENT SECTARIAN
OR NON-SECTARIAN PRIMARY OR SECONDARY SCHOOL OR PRE-KINDERGARTEN PROGRAM
THAT  IS  LOCATED  IN  THIS  STATE,  THAT  SATISFIES  THE   REQUIREMENTS
PRESCRIBED  BY  APPLICABLE  LAW FOR SUCH SCHOOLS IN THIS STATE, AND THAT
HAS QUALIFIED FOR FEDERAL TAX EXEMPTION UNDER SECTION 501(C)(3)  OF  THE
INTERNAL REVENUE CODE.
  (E)  "AUTHORIZED  CERTIFICATE  OF  RECEIPT"  SHALL  MEAN A CERTIFICATE
DESIGNED BY THE COMMISSIONER FOR THE PURPOSE OF ACKNOWLEDGING RECEIPT OF
A CHARITABLE CONTRIBUTION BY THE CHIEF EXECUTIVE  OFFICER  OF  A  PUBLIC
EDUCATION  ENTITY,  OR  OF  A  LOCAL EDUCATION FUND OR OF AN EDUCATIONAL
SCHOLARSHIP ORGANIZATION.
  (F) "ELIGIBLE PUPIL" SHALL MEAN A PUPIL WHO IS A RESIDENT OF THE STATE
OF NEW YORK AND OF AGE TO ATTEND SCHOOL IN ACCORDANCE  WITH  SUBDIVISION
ONE  OF  SECTION  THIRTY-TWO  HUNDRED TWO OF THE EDUCATION LAW OR WHO IS
FOUR YEARS OF AGE ON OR BEFORE DECEMBER FIRST OF THE YEAR IN WHICH  THEY
ARE ENROLLED IN A PRE-KINDERGARTEN PROGRAM.
  46.  CONTRIBUTIONS  TO  PUBLIC EDUCATION CREDIT. (A) FOR TAXABLE YEARS
BEGINNING ON OR AFTER JANUARY FIRST, TWO THOUSAND THIRTEEN, A CREDIT  IS
ALLOWED  FOR  THE  AMOUNT  OF  VOLUNTARY  CASH CONTRIBUTIONS MADE BY THE
TAXPAYER DURING THE TAXABLE YEAR TO A PUBLIC EDUCATION  ENTITY.  ACCEPT-
ANCE AND RECEIPT OF ALL SUCH CONTRIBUTIONS SHALL BE PERMITTED. A TAXPAY-
ER  WHO  SUBMITS WITH HIS OR HER TAX RETURN AN AUTHORIZED CERTIFICATE OF
RECEIPT SHALL BE  ALLOWED  A  CREDIT,  TO  BE  COMPUTED  AS  HEREINAFTER
PROVIDED,  AGAINST  THE TAX IMPOSED BY THIS ARTICLE.  THE AMOUNT OF SUCH

S. 2732--B                          7

CREDIT SHALL BE VALUED AT ONE HUNDRED PERCENT  OF  THE  AMOUNT  OF  SUCH
CONTRIBUTIONS IN ANY TAXABLE YEAR, NOT TO EXCEED SEVENTY-FIVE PERCENT OF
THE  TAX  DUE  FROM THE TAXPAYER UNDER THIS ARTICLE IN THE TAXABLE YEAR,
AFTER APPLICATION OF ANY OTHER ALLOWABLE CREDITS BY THE TAXPAYER.
  (B) SUCH CONTRIBUTIONS SHALL BE DEPOSITED IN A SEPARATE ACCOUNT.
  (C)  IF  MADE  TO A PUBLIC SCHOOL DISTRICT SUCH CONTRIBUTIONS SHALL BE
SUPERVISED BY A PERSON SO DESIGNATED BY THE  CHANCELLOR  OR  SUPERINTEN-
DENT.  IF  MADE  TO  A PARTICULAR SCHOOL THEY SHALL BE SUPERVISED BY THE
SCHOOL PRINCIPAL. REPORTS OF DEPOSITS AND DISBURSEMENTS SHALL BE MADE TO
THE LOCAL BOARD OF EDUCATION ANNUALLY. CHARTER SCHOOLS SHALL  MAKE  SUCH
REPORTS TO THE RESPECTIVE CHARTER SCHOOL BOARD OF TRUSTEES.
  47.  CONTRIBUTIONS  TO  LOCAL  EDUCATION  FUND CREDIT. (A) FOR TAXABLE
YEARS BEGINNING ON OR AFTER JANUARY  FIRST,  TWO  THOUSAND  THIRTEEN,  A
CREDIT IS ALLOWED FOR THE AMOUNT OF VOLUNTARY CASH CONTRIBUTIONS MADE BY
THE  TAXPAYER  DURING  THE  TAXABLE  YEAR  TO  A LOCAL EDUCATION FUND. A
TAXPAYER WHO SUBMITS WITH HIS OR HER TAX RETURN  AN  AUTHORIZED  CERTIF-
ICATE OF RECEIPT SHALL BE ALLOWED A CREDIT, TO BE COMPUTED AS HEREINAFT-
ER PROVIDED, AGAINST THE TAX IMPOSED BY THIS ARTICLE.
  (B)  THE  AMOUNT OF SUCH CREDIT SHALL BE VALUED AT ONE HUNDRED PERCENT
OF THE AMOUNT OF SUCH CONTRIBUTIONS IN ANY TAXABLE YEAR, NOT  TO  EXCEED
SEVENTY-FIVE PERCENT OF THE TAX DUE FROM THE TAXPAYER UNDER THIS ARTICLE
IN THE TAXABLE YEAR, AFTER APPLICATION OF ANY OTHER ALLOWABLE CREDITS BY
THE TAXPAYER.
  (C) THIS TAX CREDIT MAY NOT BE CLAIMED FOR ANY CONTRIBUTION TO A LOCAL
EDUCATION FUND FOR THE BENEFIT OF A DESIGNATED STUDENT.
  48.  CONTRIBUTIONS  TO  EDUCATIONAL SCHOLARSHIP ORGANIZATION CREDIT. A
CREDIT IS ALLOWED FOR THE AMOUNT OF VOLUNTARY CASH CONTRIBUTIONS MADE BY
THE TAXPAYER DURING THE  TAXABLE  YEAR  TO  AN  EDUCATIONAL  SCHOLARSHIP
ORGANIZATION.  A  TAXPAYER  WHO  SUBMITS  WITH  HIS OR HER TAX RETURN AN
AUTHORIZED CERTIFICATE OF RECEIPT SHALL  BE  ALLOWED  A  CREDIT,  TO  BE
COMPUTED  AS HEREINAFTER PROVIDED, AGAINST THE TAX IMPOSED BY THIS ARTI-
CLE.
  (A) THE AMOUNT OF SUCH CREDIT SHALL BE VALUED AT ONE  HUNDRED  PERCENT
OF  SUCH  CONTRIBUTIONS  IN ANY TAXABLE YEAR, NOT TO EXCEED SEVENTY-FIVE
PERCENT OF THE TAX DUE FROM THE TAXPAYER UNDER THIS ARTICLE IN THE TAXA-
BLE YEAR, AFTER APPLICATION  OF  ANY  OTHER  ALLOWABLE  CREDITS  BY  THE
TAXPAYER.
  (B)  THIS  TAX  CREDIT  MAY  NOT BE CLAIMED FOR ANY CONTRIBUTION TO AN
EDUCATIONAL SCHOLARSHIP ORGANIZATION FOR THE  BENEFIT  OF  A  DESIGNATED
PUPIL.
  (C)  SCHOLARSHIP AMOUNT. (1) AN EDUCATION SCHOLARSHIP ORGANIZATION MAY
AWARD A SCHOLARSHIP TO A NON-DISTRICT RESIDENT ELIGIBLE PUPIL  ATTENDING
A PUBLIC SCHOOL OPERATED BY A SCHOOL DISTRICT IN AN AMOUNT NOT TO EXCEED
THE TUITION CHARGED BY THE PARTICIPATING PUBLIC SCHOOL PURSUANT TO PARA-
GRAPH  D  OF  SUBDIVISION  FOUR OF SECTION THIRTY-TWO HUNDRED TWO OF THE
EDUCATION LAW; PROVIDED, HOWEVER THAT A SCHOLARSHIP SHALL NOT BE  AVAIL-
ABLE IN ANY CASE WHERE THE RESIDENT DISTRICT OF SUCH PUPIL IS LIABLE FOR
SUCH TUITION.
  (2) AN EDUCATION SCHOLARSHIP ORGANIZATION MAY AWARD A SCHOLARSHIP TO A
PUPIL  ENROLLED  IN  A  PUBLIC SCHOOL, INCLUDING A CHARTER SCHOOL, OR AN
ELIGIBLE NON-PUBLIC SCHOOL IN AN AMOUNT NOT TO EXCEED THE TUITION AMOUNT
OF THE ELIGIBLE NON-PUBLIC SCHOOL, PROVIDED,  HOWEVER,  THAT  THE  TOTAL
AMOUNT  OF SUCH TAX CREDITS SHALL NOT EXCEED THE AMOUNT OF AVAILABLE TAX
CREDITS FOR EDUCATIONAL SCHOLARSHIP ORGANIZATIONS SET FORTH IN PARAGRAPH
SIX OF SUBDIVISION TWENTY-NINTH OF SECTION ONE  HUNDRED  SEVENTY-ONE  OF
THIS CHAPTER.

S. 2732--B                          8

  S 5. Section 171 of the tax law is amended by adding a new subdivision
twenty-ninth to read as follows:
  TWENTY-NINTH.  FOR  THE  PURPOSE  OF  IMPLEMENTING  THE  PROVISIONS OF
SUBSECTIONS (U), (V), (W), (W-1), (W-2) AND (W-3) OF SECTION SIX HUNDRED
SIX AND SUBDIVISIONS FORTY-FIVE, FORTY-SIX, FORTY-SEVEN AND  FORTY-EIGHT
OF SECTION TWO HUNDRED TEN OF THIS CHAPTER THE COMMISSIONER SHALL:
  (1)  MAINTAIN  A  LIST  OF  PUBLIC SCHOOL DISTRICTS, INDIVIDUAL PUBLIC
SCHOOLS, INCLUDING CHARTER SCHOOLS, LOCAL EDUCATION  FUNDS,  AND  EDUCA-
TIONAL SCHOLARSHIP ORGANIZATIONS; AND
  (2)  APPROVE  TAX CREDITS ON A FIRST-COME, FIRST-SERVE BASIS FROM EACH
TAXPAYER WHO SUBMITS TO THE DEPARTMENT AN APPLICATION  PREPARED  BY  THE
COMMISSIONER  WHEREIN  THE TAXPAYER SHALL SPECIFY EACH TAX FOR WHICH THE
TAXPAYER REQUESTS A CREDIT AND THE APPLICABLE TAXABLE YEAR FOR A CREDIT,
SUBJECT TO THE LIMITS SET FORTH IN PARAGRAPH SIX  OF  THIS  SUBDIVISION;
AND
  (3)  UPON NOTIFICATION BY THE CHIEF EXECUTIVE OFFICER OF ANY EDUCATION
ENTITY SO LISTED THAT A CONTRIBUTION HAS BEEN RECEIVED,  SUCH  NOTIFICA-
TION  BEING  WITHIN  ONE BUSINESS DAY OF SAID RECEIPT, RECORD THE AMOUNT
AND DATE OF THE CONTRIBUTION, THE NAME AND ADDRESS OF  THE  CONTRIBUTOR;
AND
  (4)  UPON NOTIFICATION THAT A CREDIT FOR THE PURCHASE OF INSTRUCTIONAL
MATERIALS FOR NON-PUBLIC HOME-BASED  EDUCATIONAL  PROGRAMS,  RECORD  THE
AMOUNT  AND DATE OF THE NOTIFICATION, THE NAME AND ADDRESS OF THE CLAIM-
ANT; AND
  (5) UPON NOTIFICATION THAT A CREDIT FOR THE PURCHASE OF THE  CLASSROOM
INSTRUCTIONAL MATERIALS AND SUPPLIES FOR USE IN A PUBLIC SCHOOL, INCLUD-
ING  A  CHARTER  SCHOOL,  OR  AN  ELIGIBLE NON-PUBLIC SCHOOL, RECORD THE
AMOUNT AND DATE OF THE NOTIFICATION AND THE  NAME  AND  ADDRESS  OF  THE
CLAIMANT; AND
  (6)  MAKE  NO  MORE  THAN TWO HUNDRED FIFTY MILLION DOLLARS IN CREDITS
AVAILABLE IN ANY SINGLE TAX YEAR, PROVIDED THAT FIFTY  PERCENT  OF  SUCH
CREDITS  SHALL  BE  AFFORDED  TO  TAXPAYERS WHO MAKE DONATIONS TO PUBLIC
EDUCATION ENTITIES AND LOCAL EDUCATION FUNDS, AND FOR  THE  PURCHASE  BY
SCHOOL PERSONNEL, OF CLASSROOM INSTRUCTIONAL MATERIALS AND SUPPLIES, AND
THAT FIFTY PERCENT OF SUCH CREDITS SHALL BE AFFORDED TO EDUCATION SCHOL-
ARSHIP   ORGANIZATIONS   AND  FOR  HOME-BASED  INSTRUCTIONAL  MATERIALS,
PROVIDED FURTHER, THAT BEGINNING IN TAX YEAR TWO THOUSAND  FOURTEEN  AND
ANNUALLY  THEREAFTER, MAKE NO MORE THAN THREE HUNDRED MILLION DOLLARS IN
CREDITS AVAILABLE IN ANY SINGLE TAX YEAR, PROVIDED THAT FIFTY PERCENT OF
SUCH CREDITS SHALL BE AFFORDED TO TAXPAYERS WHO MAKE DONATIONS TO PUBLIC
EDUCATION ENTITIES AND LOCAL EDUCATION FUNDS, AND FOR  THE  PURCHASE  BY
SCHOOL  PERSONNEL OF CLASSROOM INSTRUCTIONAL MATERIALS AND SUPPLIES, AND
THAT FIFTY PERCENT OF SUCH CREDITS  SHALL  BE  AFFORDED  TO  EDUCATIONAL
SCHOLARSHIP  ORGANIZATIONS  AND  FOR HOME-BASED INSTRUCTIONAL MATERIALS;
AND
  (7) ISSUE TO TAXPAYERS ALL AUTHORIZED CERTIFICATES OF RECEIPT FOR  ALL
ELIGIBLE  CREDITS NO LATER THAN JANUARY THIRTY-FIRST FOR CREDITS CLAIMED
FOR THE PREVIOUS CALENDAR YEAR; AND
  (8) DISALLOW THE PORTION OF THE CREDIT EQUAL TO THE AMOUNT SAVED  FROM
THE  FEDERAL  TAX LIABILITY OF THE TAXPAYER FROM THE CHARITABLE CONTRIB-
UTION TO A QUALIFIED ORGANIZATION UNDER SECTION FIVE HUNDRED ONE  (C)(3)
OF THE INTERNAL REVENUE CODE OF THE UNITED STATES.
  S  6. Excess contributions. Contributions exceeding the allowed annual
maximum of the amount set forth in subdivision 29th of  section  171  of
the  tax law to public educational entities, local educational funds and
for the purchase of classroom instructional materials and  supplies  for

S. 2732--B                          9

use  in a public school, including a charter school, or an eligible non-
public school; or the allowed annual maximum of the amount set forth  in
subdivision  29th of section 171 of the tax law to education scholarship
organizations  and  for the purchase of home-based instructional materi-
als, shall be applied to the following tax year, and the donor so  noti-
fied within one business day.
  S  7.  The  department of taxation and finance shall prepare a written
report before January 31 of each  calendar  year,  which  shall  contain
statistical  information  regarding  the  credits  allowed  pursuant  to
subsections (u), (v), (w), (w-1), (w-2) and (w-3)  of  section  606  and
subdivisions 45, 46, 47 and 48 of section 210 of the tax law as added by
sections  three  and  four  of this act, for the previous calendar year.
Copies of such report shall be submitted to the governor, the  temporary
president  of  the senate, the speaker of the assembly, the chair of the
senate finance committee and the chair of the assembly  ways  and  means
committee.  Such  reports shall contain, but need not be limited to, the
number of credits by type and the amount  of  such  credits  allowed  to
taxpayers.
  S  8. This act shall not be construed to authorize the commissioner of
education or the commissioner of taxation  and  finance  to  impose  any
regulation  or  requirement  on  the educational program, instruction or
activities of an eligible non-public school  that  receives  funding  on
behalf of an eligible pupil from an educational scholarship organization
pursuant to this act, unless specifically authorized by this act.
  S 9. This act shall take effect immediately.

Co-Sponsors

view additional co-sponsors

S2732C (ACTIVE) - Bill Details

Current Committee:
Law Section:
Tax Law
Laws Affected:
Amd §§606, 210 & 171, Tax L
Versions Introduced in 2009-2010 Legislative Session:
S5146A

S2732C (ACTIVE) - Bill Texts

view summary

Establishes an education investment tax credit.

view sponsor memo
BILL NUMBER:S2732C

TITLE OF BILL:
An act
to amend the tax law, in relation to
enacting the "education investment incentives act"

PURPOSE OR GENERAL IDEA OF BILL:
This bill would authorize a tax credit up to seventy-five percent of
either personal income tax liability or corporate franchise tax
liability for donations to public education entities, local education
funds, and educational scholarship organizations, or up to $75 for
certain expenses incurred by school personnel and parents who educate
their children at home.

SUMMARY OF SPECIFIC PROVISIONS:
Section 3 amends section 606 of the tax law for the purposes of
receiving voluntary cash contribution by defining "public education
entity"; as any public school district; an individual public school,
including a charter school; a nonprofit organization for the purpose
of providing programming for performing arts, visual arts, civic
instruction, pre- kindergarten instruction, or any other educational
purpose within such schools; a nonprofit organization that allows
donors to choose school projects for charitable support that are
identified by teachers or other school personnel; and the university
of the state of New York research fund.

"Local education fund" is defined as a charitable organization in this
state that is exempt from federal taxation under section 501(c)(3) of
the Internal Revenue Code and is established for the explicit purpose
of supporting at least one public school, including a charter school,
or a specific public school district.

"Educational scholarship organization" is defined as a charitable
organization in this state that is exempt from federal taxation under
section 501(c)(3) of the Internal Revenue Code, that allocates at
least ninety percent of its donations for educational scholarships.

Section 3 limits the amount of the tax credit to seventy-five percent
of the taxpayer's tax liability, and also provides for a tax credit
for up to $75 for the purchase of instructional materials and
classroom supplies for schools by school personnel, or for non-public
home-based instruction.

Section 4 amends section 210 of the tax law by defining for the
purposes of receiving voluntary cash contributions, "public education
entity", "local education fund", and "educational scholarship
organization".

Section 5 requires approval of tax credits on a first-come,
first-served basis and provides that no taxpayer may apply for a

credit in excess of 5% of $125 million for tax year 2013, and in
excess of 5% of $150 million for tax years thereafter.

Further, section 5 disallows the portion of the credit equal to the
amount saved from the federal tax liability given a taxpayer's
donation to an IRS recognized 501(c)(3) charitable organization.

Section 5 also provides that fifty percent of the available credits be
afforded to taxpayers donating to public education entities, local
education funds, and for the purchase by school personnel for
classroom instructional material and supplies, and that fifty percent
be afforded to educational scholarship organizations and for
home-based instructional materials.

Section 6 imposes reporting requirements of the tax credits from the
department of taxation and finance to the governor, temporary
president of the senate, speaker of the assembly, and chairs of the
senate finance, and assembly ways and means committees.

Section 7 restricts the commissioners of education and taxation &
finance from imposing additional regulations on educational programs
in receipt of funding from educational scholarship organizations.

Section 8 provides that this act shall take effect immediately.

JUSTIFICATION:
At a time when the state is considering ways of reducing the tax
burden for New York State residents and educators are seeking an
expansion of financial resources, charitable giving for educational
purposes should be stimulated. permitting public education entities
such as school districts and individual public schools, including
charter schools, and non-profits that promote the arts, civics, and
pre-k instruction, to accept and receive voluntary cash contributions
will lessen the need for additional tax revenue, encouraging
voluntary support for education without prejudice for or against any
state-sponsored educational enterprise. The bill promotes the state's
interest in providing the highest quality education to all children
in the state. The tax credit does not constitute public aid to
non-public sectarian institutions. Permitting school personnel to
claim a credit for the purchase of classroom instructional materials
and supplies will insure a wider availability of such materials and
supplies for all students.

PRIOR LEGISLATIVE HISTORY:
2012: A.5081 Referred to Ways and Means, S.2732 Referred to
Investigations & Government Operations
2011: Died in Assembly, Passed Senate
2009-10: Similar to A.10862 - Died in Ways and Means Similar
to S.5146 - Died in Finance

FISCAL IMPLICATIONS:

The Department of Taxation & Finance has yet to project a first-year
revenue reduction.
However, the total tax credit available is capped at $250 million for
the 2013 tax year. The total available credit increases to $300
million in 2014 tax year, and annually thereafter.

EFFECTIVE DATE:
This act shall take effect immediately.

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

                                 2732--C

                       2011-2012 Regular Sessions

                            I N  S E N A T E

                            January 31, 2011
                               ___________

Introduced   by   Sens.   GOLDEN,   ADAMS,  ADDABBO,  GRISANTI,  HANNON,
  HASSELL-THOMPSON, MARTINS, MAZIARZ -- read twice and ordered  printed,
  and  when  printed  to be committed to the Committee on Investigations
  and Government Operations -- recommitted to the Committee on  Investi-
  gations  and  Government  Operations in accordance with Senate Rule 6,
  sec. 8 -- committee discharged, bill  amended,  ordered  reprinted  as
  amended  and  recommitted  to  said committee -- committee discharged,
  bill amended, ordered reprinted as amended  and  recommitted  to  said
  committee  -- committee discharged, bill amended, ordered reprinted as
  amended and recommitted to said committee

AN ACT to amend the tax law, in  relation  to  enacting  the  "education
  investment incentives act"

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

  Section 1. Short title. This act shall be known and may  be  cited  as
the "education investment incentives act".
  S 2. Legislative findings and intent. The legislature hereby finds and
declares that:
  a.  At  a  time when the state is considering ways of reducing the tax
burden for New York state residents and educators are seeking an  expan-
sion  of financial resources, charitable giving for educational purposes
should be stimulated;
  b. Permitting public education entities such as school  districts  and
individual  public  schools,  including  charter  schools, to accept and
receive voluntary cash contributions will lessen the need for additional
tax revenue;
  c. Encouraging voluntary support for education, without prejudice  for
or  against  any  state-sanctioned  educational enterprise, promotes the
state's interest in providing the highest quality education to all chil-
dren in the state;

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD05643-13-2

S. 2732--C                          2

  d. Requiring a sharing of resources among school districts will insure
a more equitable distribution of financial support;
  e.  The  tax credit provided in this act is merely one of many credits
available to New York taxpayers;
  f. The intended beneficiaries of the tax credit provided in  this  act
are  the  students who attend public schools, including charter schools,
or who further their educations using tuition scholarships  from  educa-
tional  scholarship  organizations,  or  who  participate  in home-based
educational programs; therefore  the  tax  credit  does  not  constitute
public aid to non-public sectarian institutions;
  g.  Permitting  school personnel to claim a credit for the purchase of
classroom instructional materials  and  supplies  will  insure  a  wider
availability of such materials and supplies for all students.
  S  3.  Section  606  of  the  tax  law  is  amended  by adding six new
subsections (u), (v), (w), (w-1), (w-2) and (w-3) to read as follows:
  (U) DEFINITIONS. AS USED IN SUBSECTIONS (V),  (W),  (W-1),  (W-2)  AND
(W-3)  OF  THIS  SECTION,  THE  FOLLOWING TERMS SHALL HAVE THE FOLLOWING
MEANINGS:
  (1) "PUBLIC EDUCATION ENTITY" SHALL MEAN ANY PUBLIC SCHOOL DISTRICT OR
ANY INDIVIDUAL PUBLIC SCHOOL, INCLUDING ANY CHARTER SCHOOL; A  NONPROFIT
ORGANIZATION  FOR  THE  PURPOSE  OF PROVIDING PROGRAMMING FOR PERFORMING
ARTS, VISUAL ARTS, CIVIC INSTRUCTION, PRE-KINDERGARTEN  INSTRUCTION,  OR
ANY OTHER EDUCATIONAL PURPOSE WITHIN SUCH SCHOOLS; A NONPROFIT ORGANIZA-
TION THAT ALLOWS DONORS TO CHOOSE SCHOOL PROJECTS FOR CHARITABLE SUPPORT
THAT  ARE  IDENTIFIED  BY  TEACHERS  OR  OTHER SCHOOL PERSONNEL; AND THE
UNIVERSITY OF THE STATE OF NEW YORK RESEARCH FUND.
  (2) "LOCAL EDUCATION FUND" SHALL MEAN  A  CHARITABLE  ORGANIZATION  IN
THIS STATE THAT:
  (A)  IS  EXEMPT  FROM FEDERAL TAXATION UNDER SECTION 501 (C)(3) OF THE
INTERNAL REVENUE CODE; AND
  (B) IS ESTABLISHED FOR THE EXPLICIT PURPOSE OF SUPPORTING AT LEAST ONE
PUBLIC SCHOOL, INCLUDING A CHARTER SCHOOL, OR A SPECIFIC  PUBLIC  SCHOOL
DISTRICT.
  (3)  "EDUCATIONAL  SCHOLARSHIP  ORGANIZATION"  SHALL MEAN A CHARITABLE
ORGANIZATION IN THIS STATE THAT:
  (A) IS EXEMPT FROM FEDERAL TAXATION UNDER SECTION 501  (C)(3)  OF  THE
INTERNAL REVENUE CODE;
  (B) ALLOCATES AT LEAST NINETY PERCENT OF DONATIONS FOR WHICH TAX CRED-
ITS  ARE  CLAIMED UNDER SUBSECTION (W-3) OF THIS SECTION FOR EDUCATIONAL
SCHOLARSHIPS;
  (C) MAKES EDUCATIONAL SCHOLARSHIPS  OR  TUITION  GRANTS  AVAILABLE  TO
CHILDREN FROM MORE THAN ONE PUBLIC OR ELIGIBLE NON-PUBLIC SCHOOL; AND
  (D)  REPORTS  ANNUALLY  TO THE DEPARTMENT THE GROSS RECEIPTS AND GROSS
AMOUNT EXPENDED FOR SCHOLARSHIPS AND TUITION GRANTS.
  (4) "ELIGIBLE NON-PUBLIC SCHOOL" SHALL MEAN AN  INDEPENDENT  SECTARIAN
OR NON-SECTARIAN PRIMARY OR SECONDARY SCHOOL OR PRE-KINDERGARTEN PROGRAM
THAT   IS  LOCATED  IN  THIS  STATE,  THAT  SATISFIES  THE  REQUIREMENTS
PRESCRIBED BY APPLICABLE LAW FOR SUCH SCHOOLS IN THIS  STATE,  AND  THAT
HAS  QUALIFIED FOR FEDERAL TAX EXEMPTION UNDER SECTION 501 (C)(3) OF THE
INTERNAL REVENUE CODE.
  (5) "AUTHORIZED CERTIFICATE  OF  RECEIPT"  SHALL  MEAN  A  CERTIFICATE
DESIGNED BY THE COMMISSIONER FOR THE PURPOSE OF ACKNOWLEDGING RECEIPT OF
A  CHARITABLE  CONTRIBUTION  BY THE CHIEF EXECUTIVE OFFICER OF AN EDUCA-
TIONAL SCHOLARSHIP ORGANIZATION.
  (6) "ELIGIBLE PUPIL" SHALL MEAN A PUPIL WHO IS A RESIDENT OF THE STATE
OF NEW YORK AND OF AGE TO ATTEND SCHOOL IN ACCORDANCE  WITH  SUBDIVISION

S. 2732--C                          3

ONE  OF  SECTION  THIRTY-TWO  HUNDRED TWO OF THE EDUCATION LAW OR WHO IS
FOUR YEARS OF AGE ON OR BEFORE DECEMBER FIRST OF THE YEAR IN WHICH  THEY
ARE ENROLLED IN A PRE-KINDERGARTEN PROGRAM.
  (V) CONTRIBUTIONS TO PUBLIC EDUCATION CREDIT. FOR TAXABLE YEARS BEGIN-
NING  ON  OR  AFTER  JANUARY  FIRST,  TWO THOUSAND THIRTEEN, A CREDIT IS
ALLOWED FOR VOLUNTARY CASH CONTRIBUTIONS MADE BY THE TAXPAYER DURING THE
TAXABLE YEAR TO A PUBLIC EDUCATION ENTITY. ACCEPTANCE AND RECEIPT OF ALL
SUCH CONTRIBUTIONS SHALL  BE  PERMITTED.  A  TAXPAYER  WHO  RECEIVES  AN
AUTHORIZED  CERTIFICATE  OF  RECEIPT  SHALL  BE  ALLOWED A CREDIT, TO BE
COMPUTED  AS HEREINAFTER PROVIDED, AGAINST THE TAX IMPOSED BY THIS ARTI-
CLE.
  (1) THE AMOUNT OF SUCH CREDIT SHALL BE VALUED AT ONE  HUNDRED  PERCENT
OF  THE  AMOUNT OF SUCH CONTRIBUTIONS IN ANY TAXABLE YEAR, NOT TO EXCEED
SEVENTY-FIVE PERCENT OF THE TAX DUE FROM THE TAXPAYER UNDER THIS ARTICLE
IN THE TAXABLE YEAR, AFTER APPLICATION OF ANY OTHER ALLOWABLE CREDITS BY
THE TAXPAYER.
  A SHAREHOLDER OF A NEW YORK S CORPORATION OR A PARTNER OF  A  PARTNER-
SHIP  (OR OTHER ENTITY TREATED AS A PARTNERSHIP FOR INCOME TAX PURPOSES)
SHALL BE TREATED AS THE TAXPAYER WITH RESPECT TO  HIS  OR  HER  PRO-RATA
SHARE  OF THE TAX CREDIT ALLOWABLE TO SUCH S CORPORATION OR PARTNERSHIP,
DETERMINED FOR THE S CORPORATION'S OR PARTNERSHIP'S TAXABLE YEAR  ENDING
WITH  OR WITHIN THE SHAREHOLDER'S OR PARTNER'S TAXABLE YEAR. THE MAXIMUM
AMOUNT OF THE CREDIT FOR SUCH S CORPORATION OR PARTNERSHIP SHALL BE  THE
SAME  AS  THAT  ALLOWABLE  TO CORPORATIONS UNDER SUBDIVISIONS FORTY-SIX,
FORTY-SEVEN AND FORTY-EIGHT OF SECTION TWO HUNDRED TEN OF THIS CHAPTER.
  (2) A HUSBAND AND WIFE WHO FILE SEPARATE RETURNS FOR A TAXABLE YEAR IN
WHICH THEY COULD HAVE FILED A JOINT RETURN MAY EACH CLAIM ONLY  ONE-HALF
OF THE TAX CREDIT THAT WOULD HAVE BEEN ALLOWED FOR A JOINT RETURN.
  (3)  IF  THE  ALLOWABLE TAX CREDIT EXCEEDS SEVENTY-FIVE PERCENT OF THE
TAXES OTHERWISE DUE UNDER THIS ARTICLE ON THE TAXPAYER'S INCOME,  OR  IF
THERE  ARE  NO  TAXES DUE UNDER THIS ARTICLE, THE TAXPAYER MAY CARRY THE
AMOUNT OF THE CREDIT NOT USED TO OFFSET THE  TAXES  UNDER  THIS  ARTICLE
FORWARD FOR NOT MORE THAN FIVE YEARS' INCOME TAX LIABILITY.
  (4)  CONTRIBUTIONS  IN ANY TAXABLE YEAR THAT RECEIVE A CREDIT PURSUANT
TO THIS SUBSECTION  SHALL  NOT  BE  CONSIDERED  ELIGIBLE  DEDUCTIONS  AS
ALLOWED  UNDER  THIS ARTICLE FOR CHARITABLE CONTRIBUTIONS. CONTRIBUTIONS
IN EXCESS OF SEVENTY-FIVE PERCENT OF A TAXPAYER'S TAX LIABILITY  IN  ANY
TAXABLE YEAR THAT DO NOT RECEIVE A TAX CREDIT SHALL BE CONSIDERED ELIGI-
BLE  DEDUCTIONS  AS  ALLOWED  UNDER THIS ARTICLE FOR CHARITABLE CONTRIB-
UTIONS.
  (5) SUCH CONTRIBUTIONS SHALL BE DEPOSITED IN A SEPARATE ACCOUNT.
  (6) IF MADE TO A PUBLIC SCHOOL DISTRICT SUCH  CONTRIBUTIONS  SHALL  BE
SUPERVISED  BY  A  PERSON SO DESIGNATED BY THE CHANCELLOR OR SUPERINTEN-
DENT. IF MADE TO A PARTICULAR SCHOOL THEY SHALL  BE  SUPERVISED  BY  THE
SCHOOL PRINCIPAL. REPORTS OF DEPOSITS AND DISBURSEMENTS SHALL BE MADE TO
THE  LOCAL  BOARD OF EDUCATION ANNUALLY. CHARTER SCHOOLS SHALL MAKE SUCH
REPORTS TO THE RESPECTIVE CHARTER SCHOOL BOARD OF TRUSTEES, AS  APPLICA-
BLE.
  (W)  CONTRIBUTIONS TO LOCAL EDUCATION FUND CREDIT. IN LIEU OF CONTRIB-
UTIONS IN SUBSECTION (V) OF THIS SECTION, A CREDIT IS ALLOWED FOR  TAXA-
BLE YEARS BEGINNING ON OR AFTER JANUARY FIRST, TWO THOUSAND THIRTEEN FOR
THE  AMOUNT  OF VOLUNTARY CASH CONTRIBUTIONS MADE BY THE TAXPAYER DURING
THE TAXABLE YEAR TO A LOCAL EDUCATION FUND. A TAXPAYER WHO  RECEIVES  AN
AUTHORIZED  CERTIFICATE  OF  RECEIPT  SHALL  BE  ALLOWED A CREDIT, TO BE
COMPUTED AS HEREINAFTER PROVIDED, AGAINST THE TAX IMPOSED BY THIS  ARTI-
CLE.

S. 2732--C                          4

  (1)  THE  AMOUNT OF SUCH CREDIT SHALL BE VALUED AT ONE HUNDRED PERCENT
OF THE AMOUNT OF SUCH CONTRIBUTIONS IN ANY TAXABLE YEAR, NOT  TO  EXCEED
SEVENTY-FIVE PERCENT OF THE TAX DUE FROM THE TAXPAYER UNDER THIS ARTICLE
IN THE TAXABLE YEAR, AFTER APPLICATION OF ANY OTHER ALLOWABLE CREDITS BY
THE TAXPAYER.  A SHAREHOLDER OF A NEW YORK S CORPORATION OR A PARTNER OF
A  PARTNERSHIP  (OR OTHER ENTITY TREATED AS A PARTNERSHIP FOR INCOME TAX
PURPOSES) SHALL BE TREATED AS THE TAXPAYER WITH RESPECT TO  HIS  OR  HER
PRO-RATA  SHARE  OF  THE  TAX  CREDIT ALLOWABLE TO SUCH S CORPORATION OR
PARTNERSHIP, DETERMINED FOR THE S CORPORATION'S OR PARTNERSHIP'S TAXABLE
YEAR ENDING WITH OR WITHIN THE SHAREHOLDER'S OR PARTNER'S TAXABLE  YEAR.
THE  MAXIMUM  AMOUNT OF THE CREDIT FOR SUCH S CORPORATION OR PARTNERSHIP
SHALL BE THE SAME AS THAT ALLOWABLE TO CORPORATIONS  UNDER  SUBDIVISIONS
FORTY-SIX,  FORTY-SEVEN  AND  FORTY-EIGHT  OF SECTION TWO HUNDRED TEN OF
THIS CHAPTER.
  (2) A HUSBAND AND WIFE WHO FILE SEPARATE RETURNS FOR A TAXABLE YEAR IN
WHICH THEY COULD HAVE FILED A JOINT RETURN MAY EACH CLAIM ONLY  ONE-HALF
OF THE TAX CREDIT THAT WOULD HAVE BEEN ALLOWED FOR A JOINT RETURN.
  (3)  IF  THE  ALLOWABLE TAX CREDIT EXCEEDS SEVENTY-FIVE PERCENT OF THE
TAXES OTHERWISE DUE UNDER THIS ARTICLE ON THE TAXPAYER'S INCOME,  OR  IF
THERE  ARE  TAXES  DUE  UNDER  THIS  ARTICLE, THE TAXPAYER MAY CARRY THE
AMOUNT OF THE CREDIT NOT USED TO OFFSET THE  TAXES  UNDER  THIS  ARTICLE
FORWARD FOR NOT MORE THAN FIVE YEARS' INCOME TAX LIABILITY.
  (4)  CONTRIBUTIONS  IN ANY TAXABLE YEAR THAT RECEIVE A CREDIT PURSUANT
TO THIS SUBSECTION SHALL BE CONSIDERED ELIGIBLE  DEDUCTIONS  AS  ALLOWED
UNDER THIS ARTICLE FOR CHARITABLE CONTRIBUTIONS. CONTRIBUTIONS IN EXCESS
OF  SEVENTY-FIVE  PERCENT  OF  A TAXPAYERS' TAX LIABILITY IN ANY TAXABLE
YEAR THAT DO NOT RECEIVE A  TAX  CREDIT  SHALL  BE  CONSIDERED  ELIGIBLE
DEDUCTIONS AS ALLOWED UNDER THIS ARTICLE FOR CHARITABLE CONTRIBUTIONS.
  (5) THIS TAX CREDIT MAY NOT BE CLAIMED FOR ANY CONTRIBUTION TO A LOCAL
EDUCATION FUND FOR THE BENEFIT OF A DESIGNATED STUDENT.
  (W-1)  HOME-BASED  INSTRUCTIONAL MATERIALS CREDIT. IN LIEU OF CONTRIB-
UTIONS IN SUBSECTIONS (V) AND (W) OF THIS SECTION, A CREDIT  IS  ALLOWED
FOR  TAXABLE  YEARS  BEGINNING  ON  OR AFTER JANUARY FIRST, TWO THOUSAND
THIRTEEN FOR THE PURCHASE  OF  INSTRUCTIONAL  MATERIALS  FOR  NON-PUBLIC
HOME-BASED  EDUCATIONAL  PROGRAMS.  THIS  CREDIT  SHALL BE VALUED AT ONE
HUNDRED PERCENT OF SUCH PURCHASES.
  (1) THE AMOUNT OF SUCH CREDIT SHALL NOT EXCEED SEVENTY-FIVE DOLLARS IN
ANY TAXABLE YEAR.
  (2) A HUSBAND AND WIFE WHO FILE SEPARATE RETURNS FOR A TAXABLE YEAR IN
WHICH THEY COULD HAVE FILED A JOINT RETURN MAY EACH CLAIM ONLY  ONE-HALF
OF THE TAX CREDIT THAT WOULD HAVE BEEN ALLOWED FOR A JOINT RETURN.
  (3)  IF THE ALLOWABLE TAX CREDIT EXCEEDS THE TAXES OTHERWISE DUE UNDER
THIS ARTICLE ON THE TAXPAYER'S INCOME, OR IF  THERE  ARE  NO  TAXES  DUE
UNDER  THIS ARTICLE, THE TAXPAYER MAY CARRY THE AMOUNT OF THE CREDIT NOT
USED TO OFFSET THE TAXES UNDER THIS ARTICLE FORWARD FOR  NOT  MORE  THAN
FIVE YEARS' INCOME TAX LIABILITY.
  (4)  THE  TAXPAYER SHALL BE RESPONSIBLE FOR NOTIFYING THE COMMISSIONER
OF THE INTENTION TO CLAIM THE ALLOWABLE CREDIT, NO LATER  THAN  DECEMBER
THIRTY-FIRST.
  (W-2) CLASSROOM INSTRUCTIONAL MATERIALS AND SUPPLIES CREDIT. FOR TAXA-
BLE  YEARS BEGINNING ON OR AFTER JANUARY FIRST, TWO THOUSAND THIRTEEN, A
CREDIT IS ALLOWED FOR THE  PERSONNEL  EMPLOYED  IN  ANY  PUBLIC  SCHOOL,
INCLUDING  ANY  CHARTER SCHOOL, OR IN ANY ELIGIBLE NON-PUBLIC SCHOOL FOR
THE PURCHASE OF CLASSROOM INSTRUCTIONAL MATERIALS AND SUPPLIES.
  (1) THE AMOUNT OF SUCH CREDIT SHALL NOT EXCEED SEVENTY-FIVE DOLLARS IN
ANY TAXABLE YEAR.

S. 2732--C                          5

  (2) THE TAXPAYER SHALL BE RESPONSIBLE FOR NOTIFYING  THE  COMMISSIONER
OF  THE  INTENTION TO CLAIM THE ALLOWABLE CREDIT, NO LATER THAN DECEMBER
THIRTY-FIRST, INDICATING WHETHER THE PURCHASE WAS  MADE  FOR  USE  IN  A
PUBLIC  SCHOOL,  INCLUDING  A  CHARTER SCHOOL, OR AN ELIGIBLE NON-PUBLIC
SCHOOL.
  (W-3) CONTRIBUTIONS TO EDUCATIONAL SCHOLARSHIP ORGANIZATION CREDIT. IN
LIEU  OF  CONTRIBUTIONS  IN SUBSECTIONS (V) AND (W) OF THIS SECTION, FOR
TAXABLE YEARS BEGINNING ON OR AFTER JANUARY FIRST,  TWO  THOUSAND  THIR-
TEEN, A CREDIT IS ALLOWED FOR THE AMOUNT OF VOLUNTARY CASH CONTRIBUTIONS
MADE  BY THE TAXPAYER DURING THE TAXABLE YEAR TO AN EDUCATIONAL SCHOLAR-
SHIP ORGANIZATION. A TAXPAYER WHO RECEIVES AN AUTHORIZED CERTIFICATE  OF
RECEIPT  SHALL  BE  ALLOWED  A  CREDIT,  TO  BE  COMPUTED AS HEREINAFTER
PROVIDED, AGAINST THE TAX IMPOSED BY THIS ARTICLE.
  (1) THE AMOUNT OF SUCH CREDIT SHALL BE VALUED AT ONE  HUNDRED  PERCENT
OF  THE  AMOUNT OF SUCH CONTRIBUTIONS IN ANY TAXABLE YEAR, NOT TO EXCEED
SEVENTY-FIVE PERCENT OF THE TAX DUE FROM THE TAXPAYER UNDER THIS ARTICLE
IN THE TAXABLE YEAR, AFTER APPLICATION OF ANY OTHER ALLOWABLE CREDITS BY
THE TAXPAYER. A SHAREHOLDER OF A NEW YORK S CORPORATION OR A PARTNER  OF
A  PARTNERSHIP  (OR OTHER ENTITY TREATED AS A PARTNERSHIP FOR INCOME TAX
PURPOSES) SHALL BE TREATED AS THE TAXPAYER WITH RESPECT TO  HIS  OR  HER
PRO-RATA  SHARE  OF  THE  TAX  CREDIT ALLOWABLE TO SUCH S CORPORATION OR
PARTNERSHIP, DETERMINED FOR THE S CORPORATION'S OR PARTNERSHIP'S TAXABLE
YEAR ENDING WITH OR WITHIN THE SHAREHOLDER'S OR PARTNER'S TAXABLE  YEAR.
THE  MAXIMUM  AMOUNT OF THE CREDIT FOR SUCH S CORPORATION OR PARTNERSHIP
SHALL BE THE SAME AS THAT ALLOWABLE TO CORPORATIONS  UNDER  SUBDIVISIONS
FORTY-SIX,  FORTY-SEVEN  AND  FORTY-EIGHT  OF SECTION TWO HUNDRED TEN OF
THIS CHAPTER.
  (2) A HUSBAND AND WIFE WHO FILE SEPARATE RETURNS FOR A TAXABLE YEAR IN
WHICH THEY COULD HAVE FILED A JOINT RETURN MAY EACH CLAIM ONLY  ONE-HALF
OF THE TAX CREDIT THAT WOULD HAVE BEEN ALLOWED FOR A JOINT RETURN.
  (3)  IF  THE  ALLOWABLE TAX CREDIT EXCEEDS SEVENTY-FIVE PERCENT OF THE
TAXES OTHERWISE DUE UNDER THIS ARTICLE ON THE TAXPAYER'S INCOME,  OR  IF
THERE  ARE  NO  TAXES DUE UNDER THIS ARTICLE, THE TAXPAYER MAY CARRY THE
AMOUNT OF CREDIT NOT USED TO OFFSET THE TAXES UNDER THIS ARTICLE FORWARD
FOR NOT MORE THAN FIVE YEARS' INCOME TAX LIABILITY.
  (4) CONTRIBUTIONS IN ANY TAXABLE YEAR THAT RECEIVE A  CREDIT  PURSUANT
TO  THIS  SUBSECTION  SHALL  NOT  BE  CONSIDERED  ELIGIBLE DEDUCTIONS AS
ALLOWED UNDER THIS ARTICLE FOR CHARITABLE  CONTRIBUTIONS.  CONTRIBUTIONS
IN  EXCESS  OF SEVENTY-FIVE PERCENT OF A TAXPAYERS' TAX LIABILITY IN ANY
TAXABLE YEAR THAT DO NOT RECEIVE A TAX CREDIT SHALL BE CONSIDERED ELIGI-
BLE DEDUCTIONS AS ALLOWED UNDER THIS  ARTICLE  FOR  CHARITABLE  CONTRIB-
UTIONS.
  (5)  THIS  TAX  CREDIT  MAY  NOT BE CLAIMED FOR ANY CONTRIBUTION TO AN
EDUCATIONAL SCHOLARSHIP ORGANIZATION FOR THE  BENEFIT  OF  A  DESIGNATED
PUPIL.
  (6) SCHOLARSHIP AMOUNT.
  (A) AN EDUCATION SCHOLARSHIP ORGANIZATION MAY AWARD A SCHOLARSHIP TO A
NON-DISTRICT  RESIDENT ELIGIBLE PUPIL ATTENDING A PUBLIC SCHOOL OPERATED
BY A SCHOOL DISTRICT IN AN AMOUNT NOT TO EXCEED THE TUITION  CHARGED  BY
THE  PARTICIPATING  PUBLIC SCHOOL PURSUANT TO PARAGRAPH D OF SUBDIVISION
FOUR OF SECTION THIRTY-TWO HUNDRED TWO OF THE EDUCATION  LAW,  PROVIDED,
HOWEVER  THAT A SCHOLARSHIP SHALL NOT BE AVAILABLE IN ANY CASE WHERE THE
RESIDENT DISTRICT OF SUCH PUPIL IS LIABLE FOR SUCH TUITION.
  (B) AN EDUCATION SCHOLARSHIP ORGANIZATION MAY AWARD AN ELIGIBLE SCHOL-
ARSHIP TO A PUPIL ENROLLED IN  A  PUBLIC  SCHOOL,  INCLUDING  A  CHARTER
SCHOOL,  OR  A  NON-PUBLIC SCHOOL IN AN AMOUNT NOT TO EXCEED THE TUITION

S. 2732--C                          6

AMOUNT OF THE ELIGIBLE NON-PUBLIC SCHOOL, PROVIDED,  HOWEVER,  THAT  THE
TOTAL  AMOUNT  OF SUCH TAX CREDITS SHALL NOT EXCEED THE AMOUNT OF AVAIL-
ABLE TAX CREDITS FOR EDUCATIONAL SCHOLARSHIP ORGANIZATIONS SET FORTH  IN
PARAGRAPH  SIX OF SUBDIVISION TWENTY-NINTH OF SECTION ONE HUNDRED SEVEN-
TY-ONE OF THIS CHAPTER.
  S 4. Section 210 of the tax law is amended by adding four new subdivi-
sions 45, 46, 47 and 48 to read as follows:
  45. DEFINITIONS. AS USED IN SUBDIVISIONS  FORTY-SIX,  FORTY-SEVEN  AND
FORTY-EIGHT OF THIS SECTION THE FOLLOWING TERMS SHALL HAVE THE FOLLOWING
MEANINGS:
  (A) "PUBLIC EDUCATION ENTITY" SHALL MEAN ANY PUBLIC SCHOOL DISTRICT OR
ANY  INDIVIDUAL PUBLIC SCHOOL, INCLUDING ANY CHARTER SCHOOL; A NONPROFIT
ORGANIZATION FOR THE PURPOSE OF  PROVIDING  PROGRAMMING  FOR  PERFORMING
ARTS,  VISUAL  ARTS, CIVIC INSTRUCTION, PRE-KINDERGARTEN INSTRUCTION, OR
ANY OTHER EDUCATIONAL PURPOSE WITHIN SUCH SCHOOLS; A NONPROFIT ORGANIZA-
TION THAT ALLOWS DONORS TO CHOOSE SCHOOL PROJECTS FOR CHARITABLE SUPPORT
THAT ARE IDENTIFIED BY TEACHERS  OR  OTHER  SCHOOL  PERSONNEL;  AND  THE
UNIVERSITY OF THE STATE OF NEW YORK RESEARCH FUND.
  (B)  "LOCAL  EDUCATION  FUND"  SHALL MEAN A CHARITABLE ORGANIZATION IN
THIS STATE THAT:
  (1) IS EXEMPT FROM FEDERAL TAXATION UNDER SECTION 501(C)  (3)  OF  THE
INTERNAL REVENUE CODE; AND
  (2) IS ESTABLISHED FOR THE EXPLICIT PURPOSE OF SUPPORTING AT LEAST ONE
PUBLIC  SCHOOL,  INCLUDING A CHARTER SCHOOL, OR A SPECIFIC PUBLIC SCHOOL
DISTRICT.
  (C) "EDUCATIONAL SCHOLARSHIP ORGANIZATION"  SHALL  MEAN  A  CHARITABLE
ORGANIZATION IN THIS STATE THAT:
  (1)  IS  EXEMPT  FROM  FEDERAL TAXATION UNDER SECTION 501(C)(3) OF THE
INTERNAL REVENUE CODE;
  (2) ALLOCATES AT LEAST NINETY PERCENT OF DONATIONS FOR  WHICH  CREDITS
ARE  CLAIMED  UNDER  SUBDIVISION  FORTY-EIGHT OF THIS SECTION FOR EDUCA-
TIONAL SCHOLARSHIPS;
  (3) MAKES EDUCATIONAL SCHOLARSHIPS  OR  TUITION  GRANTS  AVAILABLE  TO
CHILDREN FROM MORE THAN ONE PUBLIC OR ELIGIBLE NON-PUBLIC SCHOOL; AND
  (4)  REPORTS  ANNUALLY  TO THE DEPARTMENT THE GROSS RECEIPTS AND GROSS
AMOUNT EXPENDED FOR SCHOLARSHIPS AND TUITION GRANTS.
  (D) "ELIGIBLE NON-PUBLIC SCHOOL" SHALL MEAN AN  INDEPENDENT  SECTARIAN
OR NON-SECTARIAN PRIMARY OR SECONDARY SCHOOL OR PRE-KINDERGARTEN PROGRAM
THAT   IS  LOCATED  IN  THIS  STATE,  THAT  SATISFIES  THE  REQUIREMENTS
PRESCRIBED BY APPLICABLE LAW FOR SUCH SCHOOLS IN THIS  STATE,  AND  THAT
HAS  QUALIFIED  FOR FEDERAL TAX EXEMPTION UNDER SECTION 501(C)(3) OF THE
INTERNAL REVENUE CODE.
  (E) "AUTHORIZED CERTIFICATE  OF  RECEIPT"  SHALL  MEAN  A  CERTIFICATE
DESIGNED BY THE COMMISSIONER FOR THE PURPOSE OF ACKNOWLEDGING RECEIPT OF
A  CHARITABLE  CONTRIBUTION  BY  THE CHIEF EXECUTIVE OFFICER OF A PUBLIC
EDUCATION ENTITY, OR OF A LOCAL EDUCATION  FUND  OR  OF  AN  EDUCATIONAL
SCHOLARSHIP ORGANIZATION.
  (F) "ELIGIBLE PUPIL" SHALL MEAN A PUPIL WHO IS A RESIDENT OF THE STATE
OF  NEW  YORK AND OF AGE TO ATTEND SCHOOL IN ACCORDANCE WITH SUBDIVISION
ONE OF SECTION THIRTY-TWO HUNDRED TWO OF THE EDUCATION  LAW  OR  WHO  IS
FOUR  YEARS OF AGE ON OR BEFORE DECEMBER FIRST OF THE YEAR IN WHICH THEY
ARE ENROLLED IN A PRE-KINDERGARTEN PROGRAM.
  46. CONTRIBUTIONS TO PUBLIC EDUCATION CREDIT. (A) IN LIEU OF  CONTRIB-
UTIONS  IN SUBDIVISIONS FORTY-SEVEN AND FORTY-EIGHT OF THIS SECTION, FOR
TAXABLE YEARS BEGINNING ON OR AFTER JANUARY FIRST,  TWO  THOUSAND  THIR-
TEEN, A CREDIT IS ALLOWED FOR THE AMOUNT OF VOLUNTARY CASH CONTRIBUTIONS

S. 2732--C                          7

MADE BY THE TAXPAYER DURING THE TAXABLE YEAR TO A PUBLIC EDUCATION ENTI-
TY. ACCEPTANCE AND RECEIPT OF ALL SUCH CONTRIBUTIONS SHALL BE PERMITTED.
A  TAXPAYER  WHO  RECEIVES AN AUTHORIZED CERTIFICATE OF RECEIPT SHALL BE
ALLOWED  A  CREDIT,  TO BE COMPUTED AS HEREINAFTER PROVIDED, AGAINST THE
TAX IMPOSED BY THIS ARTICLE.  THE AMOUNT OF SUCH CREDIT SHALL BE  VALUED
AT  ONE HUNDRED PERCENT OF THE AMOUNT OF SUCH CONTRIBUTIONS IN ANY TAXA-
BLE YEAR, NOT TO EXCEED SEVENTY-FIVE PERCENT OF THE  TAX  DUE  FROM  THE
TAXPAYER  UNDER  THIS  ARTICLE IN THE TAXABLE YEAR, AFTER APPLICATION OF
ANY OTHER ALLOWABLE CREDITS BY THE TAXPAYER.
  (B) SUCH CONTRIBUTIONS SHALL BE DEPOSITED IN A SEPARATE ACCOUNT.
  (C) IF MADE TO A PUBLIC SCHOOL DISTRICT SUCH  CONTRIBUTIONS  SHALL  BE
SUPERVISED  BY  A  PERSON SO DESIGNATED BY THE CHANCELLOR OR SUPERINTEN-
DENT. IF MADE TO A PARTICULAR SCHOOL THEY SHALL  BE  SUPERVISED  BY  THE
SCHOOL PRINCIPAL. REPORTS OF DEPOSITS AND DISBURSEMENTS SHALL BE MADE TO
THE  LOCAL  BOARD OF EDUCATION ANNUALLY. CHARTER SCHOOLS SHALL MAKE SUCH
REPORTS TO THE RESPECTIVE CHARTER SCHOOL BOARD OF TRUSTEES.
  47. CONTRIBUTIONS TO LOCAL EDUCATION  FUND  CREDIT.  (A)  IN  LIEU  OF
CONTRIBUTIONS IN SUBDIVISIONS FORTY-SIX AND FORTY-EIGHT OF THIS SECTION,
FOR  TAXABLE  YEARS  BEGINNING  ON  OR AFTER JANUARY FIRST, TWO THOUSAND
THIRTEEN, A CREDIT IS ALLOWED FOR THE AMOUNT OF VOLUNTARY CASH  CONTRIB-
UTIONS MADE BY THE TAXPAYER DURING THE TAXABLE YEAR TO A LOCAL EDUCATION
FUND. A TAXPAYER WHO RECEIVES AN AUTHORIZED CERTIFICATE OF RECEIPT SHALL
BE ALLOWED A CREDIT, TO BE COMPUTED AS HEREINAFTER PROVIDED, AGAINST THE
TAX IMPOSED BY THIS ARTICLE.
  (B)  THE  AMOUNT OF SUCH CREDIT SHALL BE VALUED AT ONE HUNDRED PERCENT
OF THE AMOUNT OF SUCH CONTRIBUTIONS IN ANY TAXABLE YEAR, NOT  TO  EXCEED
SEVENTY-FIVE PERCENT OF THE TAX DUE FROM THE TAXPAYER UNDER THIS ARTICLE
IN THE TAXABLE YEAR, AFTER APPLICATION OF ANY OTHER ALLOWABLE CREDITS BY
THE TAXPAYER.
  (C) THIS TAX CREDIT MAY NOT BE CLAIMED FOR ANY CONTRIBUTION TO A LOCAL
EDUCATION FUND FOR THE BENEFIT OF A DESIGNATED STUDENT.
  48.  CONTRIBUTIONS  TO EDUCATIONAL SCHOLARSHIP ORGANIZATION CREDIT. IN
LIEU OF CONTRIBUTIONS IN SUBDIVISIONS FORTY-SIX AND FORTY-SEVEN OF  THIS
SECTION,  A  CREDIT IS ALLOWED FOR THE AMOUNT OF VOLUNTARY CASH CONTRIB-
UTIONS MADE BY THE TAXPAYER DURING THE TAXABLE YEAR  TO  AN  EDUCATIONAL
SCHOLARSHIP  ORGANIZATION. A TAXPAYER WHO RECEIVES AN AUTHORIZED CERTIF-
ICATE OF RECEIPT SHALL BE ALLOWED A CREDIT, TO BE COMPUTED AS HEREINAFT-
ER PROVIDED, AGAINST THE TAX IMPOSED BY THIS ARTICLE.
  (A) THE AMOUNT OF SUCH CREDIT SHALL BE VALUED AT ONE  HUNDRED  PERCENT
OF  SUCH  CONTRIBUTIONS  IN ANY TAXABLE YEAR, NOT TO EXCEED SEVENTY-FIVE
PERCENT OF THE TAX DUE FROM THE TAXPAYER UNDER THIS ARTICLE IN THE TAXA-
BLE YEAR, AFTER APPLICATION  OF  ANY  OTHER  ALLOWABLE  CREDITS  BY  THE
TAXPAYER.
  (B)  THIS  TAX  CREDIT  MAY  NOT BE CLAIMED FOR ANY CONTRIBUTION TO AN
EDUCATIONAL SCHOLARSHIP ORGANIZATION FOR THE  BENEFIT  OF  A  DESIGNATED
PUPIL.
  (C)  SCHOLARSHIP AMOUNT. (1) AN EDUCATION SCHOLARSHIP ORGANIZATION MAY
AWARD A SCHOLARSHIP TO A NON-DISTRICT RESIDENT ELIGIBLE PUPIL  ATTENDING
A PUBLIC SCHOOL OPERATED BY A SCHOOL DISTRICT IN AN AMOUNT NOT TO EXCEED
THE TUITION CHARGED BY THE PARTICIPATING PUBLIC SCHOOL PURSUANT TO PARA-
GRAPH  D  OF  SUBDIVISION  FOUR OF SECTION THIRTY-TWO HUNDRED TWO OF THE
EDUCATION LAW; PROVIDED, HOWEVER THAT A SCHOLARSHIP SHALL NOT BE  AVAIL-
ABLE IN ANY CASE WHERE THE RESIDENT DISTRICT OF SUCH PUPIL IS LIABLE FOR
SUCH TUITION.
  (2) AN EDUCATION SCHOLARSHIP ORGANIZATION MAY AWARD A SCHOLARSHIP TO A
PUPIL  ENROLLED  IN  A  PUBLIC SCHOOL, INCLUDING A CHARTER SCHOOL, OR AN

S. 2732--C                          8

ELIGIBLE NON-PUBLIC SCHOOL IN AN AMOUNT NOT TO EXCEED THE TUITION AMOUNT
OF THE ELIGIBLE NON-PUBLIC SCHOOL, PROVIDED,  HOWEVER,  THAT  THE  TOTAL
AMOUNT  OF SUCH TAX CREDITS SHALL NOT EXCEED THE AMOUNT OF AVAILABLE TAX
CREDITS FOR EDUCATIONAL SCHOLARSHIP ORGANIZATIONS SET FORTH IN PARAGRAPH
SIX  OF  SUBDIVISION  TWENTY-NINTH OF SECTION ONE HUNDRED SEVENTY-ONE OF
THIS CHAPTER.
  S 5. Section 171 of the tax law is amended by adding a new subdivision
twenty-ninth to read as follows:
  TWENTY-NINTH. FOR  THE  PURPOSE  OF  IMPLEMENTING  THE  PROVISIONS  OF
SUBSECTIONS (U), (V), (W), (W-1), (W-2) AND (W-3) OF SECTION SIX HUNDRED
SIX  AND SUBDIVISIONS FORTY-FIVE, FORTY-SIX, FORTY-SEVEN AND FORTY-EIGHT
OF SECTION TWO HUNDRED TEN OF THIS CHAPTER THE COMMISSIONER SHALL:
  (1) MAINTAIN A LIST OF  PUBLIC  SCHOOL  DISTRICTS,  INDIVIDUAL  PUBLIC
SCHOOLS,  INCLUDING  CHARTER  SCHOOLS, LOCAL EDUCATION FUNDS, AND EDUCA-
TIONAL SCHOLARSHIP ORGANIZATIONS; AND
  (2) APPROVE TAX CREDITS ON A FIRST-COME, FIRST-SERVE BASIS  FROM  EACH
TAXPAYER  WHO  SUBMITS  TO THE DEPARTMENT AN APPLICATION PREPARED BY THE
COMMISSIONER WHEREIN THE TAXPAYER SHALL SPECIFY EACH TAX FOR  WHICH  THE
TAXPAYER REQUESTS A CREDIT AND THE APPLICABLE TAXABLE YEAR FOR A CREDIT,
SUBJECT TO THE LIMITS SET FORTH IN PARAGRAPH SIX OF THIS SUBDIVISION AND
PROVIDED  THAT  NO  TAXPAYER  MAY  APPLY  FOR A CREDIT IN EXCESS OF FIVE
PERCENT OF ONE HUNDRED TWENTY-FIVE MILLION  DOLLARS  FOR  TAX  YEAR  TWO
THOUSAND  THIRTEEN  AND  ONE HUNDRED FIFTY MILLION DOLLARS FOR TAX YEARS
BEGINNING ON AND AFTER JANUARY FIRST, TWO THOUSAND FOURTEEN; AND
  (3) UPON NOTIFICATION BY THE CHIEF EXECUTIVE OFFICER OF ANY  EDUCATION
ENTITY  SO  LISTED THAT A CONTRIBUTION HAS BEEN RECEIVED, SUCH NOTIFICA-
TION BEING WITHIN ONE BUSINESS DAY OF SAID RECEIPT,  RECORD  THE  AMOUNT
AND  DATE  OF THE CONTRIBUTION, THE NAME AND ADDRESS OF THE CONTRIBUTOR;
AND
  (4) UPON NOTIFICATION THAT A CREDIT FOR THE PURCHASE OF  INSTRUCTIONAL
MATERIALS  FOR  NON-PUBLIC  HOME-BASED  EDUCATIONAL PROGRAMS, RECORD THE
AMOUNT AND DATE OF THE NOTIFICATION, THE NAME AND ADDRESS OF THE  CLAIM-
ANT; AND
  (5)  UPON NOTIFICATION THAT A CREDIT FOR THE PURCHASE OF THE CLASSROOM
INSTRUCTIONAL MATERIALS AND SUPPLIES FOR USE IN A PUBLIC SCHOOL, INCLUD-
ING A CHARTER SCHOOL, OR  AN  ELIGIBLE  NON-PUBLIC  SCHOOL,  RECORD  THE
AMOUNT  AND  DATE  OF  THE  NOTIFICATION AND THE NAME AND ADDRESS OF THE
CLAIMANT; AND
  (6) MAKE NO MORE THAN TWO HUNDRED FIFTY  MILLION  DOLLARS  IN  CREDITS
AVAILABLE  IN  ANY  SINGLE TAX YEAR, PROVIDED THAT FIFTY PERCENT OF SUCH
CREDITS SHALL BE AFFORDED TO TAXPAYERS  WHO  MAKE  DONATIONS  TO  PUBLIC
EDUCATION  ENTITIES  AND  LOCAL EDUCATION FUNDS, AND FOR THE PURCHASE BY
SCHOOL PERSONNEL, OF CLASSROOM INSTRUCTIONAL MATERIALS AND SUPPLIES, AND
THAT FIFTY PERCENT OF SUCH CREDITS SHALL BE AFFORDED TO EDUCATION SCHOL-
ARSHIP  ORGANIZATIONS  AND  FOR  HOME-BASED   INSTRUCTIONAL   MATERIALS,
PROVIDED  FURTHER,  THAT BEGINNING IN TAX YEAR TWO THOUSAND FOURTEEN AND
ANNUALLY THEREAFTER, MAKE NO MORE THAN THREE HUNDRED MILLION DOLLARS  IN
CREDITS AVAILABLE IN ANY SINGLE TAX YEAR, PROVIDED THAT FIFTY PERCENT OF
SUCH CREDITS SHALL BE AFFORDED TO TAXPAYERS WHO MAKE DONATIONS TO PUBLIC
EDUCATION  ENTITIES  AND  LOCAL EDUCATION FUNDS, AND FOR THE PURCHASE BY
SCHOOL PERSONNEL OF CLASSROOM INSTRUCTIONAL MATERIALS AND SUPPLIES,  AND
THAT  FIFTY  PERCENT  OF  SUCH  CREDITS SHALL BE AFFORDED TO EDUCATIONAL
SCHOLARSHIP ORGANIZATIONS AND FOR  HOME-BASED  INSTRUCTIONAL  MATERIALS;
AND

S. 2732--C                          9

  (7)  ISSUE TO TAXPAYERS ALL AUTHORIZED CERTIFICATES OF RECEIPT FOR ALL
ELIGIBLE CREDITS NO LATER THAN JANUARY THIRTY-FIRST FOR CREDITS  CLAIMED
FOR THE PREVIOUS CALENDAR YEAR; AND
  (8)  DISALLOW THE PORTION OF THE CREDIT EQUAL TO THE AMOUNT SAVED FROM
THE FEDERAL TAX LIABILITY OF THE TAXPAYER FROM THE  CHARITABLE  CONTRIB-
UTION  TO A QUALIFIED ORGANIZATION UNDER SECTION FIVE HUNDRED ONE (C)(3)
OF THE INTERNAL REVENUE CODE OF THE UNITED STATES.
  S 6.  The department of taxation and finance shall prepare  a  written
report  before  January  31  of  each calendar year, which shall contain
statistical  information  regarding  the  credits  allowed  pursuant  to
subsections  (u),  (v),  (w),  (w-1), (w-2) and (w-3) of section 606 and
subdivisions 45, 46, 47 and 48 of section 210 of the tax law as added by
sections three and four of this act, for  the  previous  calendar  year.
Copies  of such report shall be submitted to the governor, the temporary
president of the senate, the speaker of the assembly, the chair  of  the
senate  finance  committee  and the chair of the assembly ways and means
committee. Such reports shall contain, but need not be limited  to,  the
number  of  credits  by  type  and the amount of such credits allowed to
taxpayers.
  S 7. This act shall not be construed to authorize the commissioner  of
education  or  the  commissioner  of  taxation and finance to impose any
regulation or requirement on the  educational  program,  instruction  or
activities  of  an  eligible  non-public school that receives funding on
behalf of an eligible pupil from an educational scholarship organization
pursuant to this act, unless specifically authorized by this act.
  S 8. This act shall take effect immediately.

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