Senate Bill S7420

2011-2012 Legislative Session

For purposes of the enhanced STAR exemption; exempt single lump-sum payments from litigation from the definition of "income"

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Archive: Last Bill Status - In Senate Committee Local Government Committee

Introduced
- In Committee Assembly
- In Committee Senate
- On Floor Calendar Assembly
- On Floor Calendar Senate
- Passed Assembly
- Passed Senate
Delivered to Governor
Signed By Governor

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Date of Action	Assembly Actions - Lowercase Senate Actions - UPPERCASE
May 11, 2012	referred to local government

2011-S7420 (ACTIVE) - Details

Current Committee:: Senate Local Government
Law Section:: Real Property Tax Law
Laws Affected:: Amd §425, RPT L

2011-S7420 (ACTIVE) - Summary

Exempts single lump-sum payments from litigation from the definition of "income" for the purpose of the enhanced STAR exemption, when such payment does not exceed twice the income standard for the assessment roll.

2011-S7420 (ACTIVE) - Sponsor Memo

                                BILL NUMBER:S7420

TITLE OF BILL:
An act to amend the real property tax law, in relation to exempting
certain lump-sum payments from inclusion as "income" for purposes of
the enhanced school tax relief exemption

PURPOSE:
To exclude single, lump-sum legal settlements from the definition of
"income" for purposes of the enhanced STAR exemption under certain
conditions.

SUMMARY OF PROVISIONS:
Section 1 of the bill amends clause (C) of subparagraph (i) of
paragraph (b) of subdivision 4 of section 425 of the real property tax
(RPT) law to prevent the Department of Taxation and Finance or any
local assessor from establishing an applicable income tax year that
does not comply with the provisions of this clause.

Section 2 amends RPT §425(4)(b)(ii) to exclude a single lump-sum
payment from a legal cause of action, provided it does not exceed
twice the amount of the applicable income standard for the assessment
roll, less attorney's fees.

Section 3 amends RPT §425(4)(b)(vi) to require documented proof of any
legal settlement.

Section 4 provides that anyone who was denied eligibility in the
Enhanced STAR program between January 1, 2011 and the effective date
of this act, and who would have been eligible for the exemption
pursuant to its provisions, may retroactively apply for the exemption
within 180 days of the bill becoming law.

Section 5 provides the effective date.

JUSTIFICATION:
The Enhanced STAR program provides vital property tax relief to New
York's seniors and, in many cases, is the sole reason they can afford
to remain in their homes. The sponsor is aware of situations where an
otherwise eligible senior citizen was denied the Enhanced STAR
exemption because a modest, one-time legal settlement was reflected as
gross income in the year it was received. This seems an unwarranted
denial because of a temporary increase in income that will have real
consequences for senior citizens who are already struggling to get by
on a fixed income. This legislation is needed to protect access to a
vital tax exemption that is ever more important to New York's seniors
in these difficult economic times.

LEGISLATIVE HISTORY:
New bill.

FISCAL IMPLICATIONS:
To be determined.

EFFECTIVE DATE:


This act shall take effect immediately, and the provisions of section
one of this act shall be deemed to have been in full force and effect
on and after January 1, 2011.

2011-S7420 (ACTIVE) - Bill Text download pdf

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

                                  7420

                            I N  S E N A T E

                              May 11, 2012
                               ___________

Introduced  by  Sen. JOHNSON -- read twice and ordered printed, and when
  printed to be committed to the Committee on Local Government

AN ACT to amend the real property tax  law,  in  relation  to  exempting
  certain  lump-sum  payments from inclusion as "income" for purposes of
  the enhanced school tax relief exemption

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

  Section 1. Clause (C) of subparagraph (i) of paragraph (b) of subdivi-
sion  4  of  section  425  of  the  real property tax law, as amended by
section 3 of part E of chapter 83 of the laws of  2002,  is  amended  to
read as follows:
  (C)  For  final assessment rolls to be completed in each ensuing year,
the applicable income tax year, cost-of-living-adjustment percentage and
applicable increase percentage shall all be advanced by  one  year,  and
the  income  standard shall be the previously-applicable income standard
increased by the new cost-of-living-adjustment  percentage.    UNDER  NO
CIRCUMSTANCE  SHALL THE DEPARTMENT OR ANY ASSESSOR PROVIDE FOR OR ESTAB-
LISH AN APPLICABLE INCOME TAX  YEAR  WHICH  DOES  NOT  COMPLY  WITH  THE
PROVISIONS  OF THIS CLAUSE. If there should be a year for which there is
no applicable increase percentage due to a general benefit  increase  as
defined  by  subdivision three of subsection (i) of section four hundred
fifteen of title forty-two of the United  States  code,  the  applicable
increase  percentage for purposes of this computation shall be deemed to
be  the  percentage  which  would  have  yielded  that  general  benefit
increase.
  S  2.  Subparagraph  (ii) of paragraph (b) of subdivision 4 of section
425 of the real property tax law, as amended by section 3 of part  E  of
chapter 83 of the laws of 2002, is amended to read as follows:
  (ii)  The  term "income" as used herein shall mean the "adjusted gross
income" for federal income tax purposes as reported on  the  applicant's
federal  or  state income tax return for the applicable income tax year,
subject to any subsequent amendments or revisions, reduced  by  distrib-
utions,  to  the  extent  included  in  federal  adjusted  gross income,
received from an individual retirement account and an individual retire-

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

                                                           LBD15760-02-2

S. 7420                             2

ment annuity; PROVIDED, HOWEVER, THAT SUCH TERM SHALL  NOT  INCLUDE  ANY
INCOME  FROM  A  SINGLE LUMP-SUM PAYMENT ACCRUING TO THE TAXPAYER AS THE
RESULT OF COMPENSATION PAID PURSUANT TO A CAUSE OF  ACTION,  WHICH  DOES
NOT EXCEED, LESS ANY ATTORNEY'S FEES, TWICE THE AMOUNT OF THE APPLICABLE
INCOME  STANDARD  FOR THE ASSESSMENT ROLL; provided, FURTHER, that if no
such return was filed for the applicable income tax year, "income" shall
mean the adjusted gross income that would have been so reported if  such
a return had been filed.
  S  3.  Subparagraph  (vi) of paragraph (b) of subdivision 4 of section
425 of the real property tax law is amended by adding a new clause (C-1)
to read as follows:
  (C-1) APPLICATIONS SUBMITTED BY A PERSON OR PERSONS WHO HAVE  RECEIVED
A  LUMP-SUM  PAYMENT  AS  THE  RESULT OF COMPENSATION PAID PURSUANT TO A
CAUSE OF ACTION;
  S 4.  Notwithstanding any provision of law to the contrary, any person
who was denied eligibility for the enhanced school tax relief exemption,
pursuant to section 425 of the real property tax law, after  January  1,
2011 and before the date upon which this act shall have become a law and
who  would  have  been  eligible  for  such  exemption  pursuant  to the
provisions of this act,  may  retroactively  apply  to  the  appropriate
assessor,  within 180 days of the date this act shall have become a law,
for the exemption. If the assessor shall find that any such applicant is
eligible for the enhanced exemption, the education department shall  pay
the  applicant  the  difference  between  the tax savings, as determined
pursuant to section 1306-a of the real property tax law,  the  applicant
would have received with the enhanced exemption and the tax savings from
the school tax relief exemption that the applicant received.
  S  5.  This  act  shall take effect immediately, and the provisions of
section one of this act shall be deemed to have been in full  force  and
effect on and after January 1, 2011.

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Senate Bill S7420

Sponsored By

Archive: Last Bill Status - In Senate Committee Local Government Committee

Actions

2011-S7420 (ACTIVE) - Details

2011-S7420 (ACTIVE) - Summary

2011-S7420 (ACTIVE) - Sponsor Memo

2011-S7420 (ACTIVE) - Bill Text download pdf

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Sponsored By

Owen H. Johnson

Archive: Last Bill Status - In Senate Committee Local Government Committee

Actions

2011-S7420 (ACTIVE) - Details

2011-S7420 (ACTIVE) - Summary

2011-S7420 (ACTIVE) - Sponsor Memo

2011-S7420 (ACTIVE) - Bill Text download pdf

Comments