senate Bill S6737B

2013-2014 Legislative Session

Establishes corporate, business franchise, personal, insurance and banking tax credits for the provision of employee federal qualified transportation fringe benefits

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Sponsored By

Archive: Last Bill Status - In Committee


  • 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
May 05, 2014 print number 6737b
amend and recommit to investigations and government operations
Apr 23, 2014 print number 6737a
amend and recommit to investigations and government operations
Mar 05, 2014 referred to investigations and government operations

Bill Amendments

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

Co-Sponsors

S6737 - Bill Details

Current Committee:
Law Section:
Tax Law
Laws Affected:
Add §§42 & 187-t, amd §§210, 606, 1456 & 1511, Tax L

S6737 - Bill Texts

view summary

Establishes corporate, business franchise, personal, insurance and banking tax credits for the provision of employee federal qualified transportation fringe benefits.

view sponsor memo
BILL NUMBER:S6737

TITLE OF BILL: An act to amend the tax law, in relation to
establishing tax credits for taxpayers which provide their employees
with access to federal qualified transportation fringe benefits

PURPOSE:

To provide businesses with a tax credit as an incentive to offer their
employees federal qualified transportation benefits.

SUMMARY OF PROVISIONS:

Section 1 adds a new section 41 to the tax law. This section gives
filers who file under articles nine, nine-A, twenty-two, thirty-two,
or thirty-three of the tax law a credit against such taxes in tax year
2014. The credit is equal to $50 for each employee who elects to
participate in a qualified fringe transportation benefit program
offered by the employer, as defined by section 132(f) of the Internal
Revenue Code. This credit can be claimed only by an employer who
establishes such a program on the tax year they claimed the credit for
without having offered such a program previously. The maximum credit
any tax payer can claim is $50,000. The maximum amount which can be
claimed for this credit by all filers is $5 million.

Section 2 adds a new section 187-t of the tax law to establish the
credit explained above in article nine of the tax law.

Section 3 amends section 210 of the tax law by adding a new
subdivision 48 to establish the credit explained above in article
nine-A of the tax law.

Section 4 amends subparagraph (B) of paragraph 1 of subsection (i) of
section 606 of the tax law to establish the credit explained above to
article 22 of the tax law.

Section 5 amends section 606 of the tax law by adding a new subsection
(u) to add this credit to the list of credits that can be claimed
under this section of the law.

Section 6 amends section 1456 of the tax law by adding a new
subsection (aa) to establish the credit explained above to article
thirty-two of the tax law.

Section 7 amends section 1511 of the tax law by adding a new
subdivision (dd) to establish the credit explained above to article
thirty-three of the tax law.

Section 8 establishes an immediate effective date.

JUSTIFICATION:

Every day over 8.9 million New Yorkers commute to work. Commuting
costs can quickly add up and eat up an important chunk of an
individual's annual budget. New York state is unique in the number of
employees who commute using public transportation. According to the
Bureau of Labor, in the 2011-2012 period the average expenditure in


transportation in the New York Metropolitan statistical region was
around $8,000 a year, with the expense on mass transit being an
average of $1,142.

In order to help pay for commuting expenses, federal tax law allows
employers to offer a benefit that sets aside pre-taxable income with
which employees can pay for eligible commuting expenses. Each year the
IRS sets the limit for how much income an employee can set aside to
pay for qualifying transportation expenses. For tax year 2014,
employees can set aside up to $250 a month in income to pay for
qualifying parking expenses related to an individual's parking
expenses at work, and up to $130 a month to pay for transit expenses
like paying for mass transit or commuter van service. An employee may
also receive a $20 a month for qualified bicycling expenses. The
income that is set aside each month is exempt from all taxation,
including payroll taxes and federal, state, and local income taxes.
This means that the employees tax bill is lowered by hundreds of
dollars, with the specific savings determined by how much income is
set aside and the income tax status of the employee. The employer also
saves money, since the salary put side is exempted from the employer
share of payroll taxes. Unfortunately, even though employers can save
money as well, according to the Bureau of Labor survey of employee
benefits only 8% of employees in the Northeast region have access to
this benefit. This declines to only 3% of employers with under 100
employees offer this benefit.

Businesses provide this fringe benefit by working with third party
program administrators who administrate the program. There are some
minor administrative fees that employers pay, as well as paperwork to
be filed in order to begin offering the benefit. While these
administrative costs would be easily recouped in the vast majority of
cases just from the tax benefit the employers get plus ancillary
benefits such as improving employee satisfaction, they can lead to
some employers choosing not to offer these benefits. The tax credit
proposed is meant to give businesses an incentive to establish these
programs and offer them to their employees by more than covering
whatever up-front costs they would have to deal with in establishing
the program. If employers in New York make full use of this credit,
100,000 workers in New York would gain access to this benefit, and see
their commuting costs cut. Those businesses who establish these
Programs would then reap the benefits in following years.

LEGISLATIVE HISTORY:

This is new legislation.

FISCAL IMPLICATIONS:

The credit amount to be offered is capped at $5 million. Since the
benefit allows employees to deduct income set aside income used for
qualified expenses from taxes, there would be an additional associated
cost to the state in the form of lost income tax revenue. If the
program is fully utilized, we estimate there could be a concurrent
loss of $14 million in income tax revenue to the state.

EFFECTIVE DATE:


This act takes effect immediately.

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

                                  6737

                            I N  S E N A T E

                              March 5, 2014
                               ___________

Introduced  by  Sens. CARLUCCI, KLEIN, SAVINO, VALESKY -- 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 establishing tax credits for
  taxpayers  which provide their employees with access to federal quali-
  fied transportation fringe benefits

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

  Section  1.  The tax law is amended by adding a new section 41 to read
as follows:
  S 41. CREDIT FOR PROVISION OF EMPLOYEE FEDERAL  QUALIFIED  TRANSPORTA-
TION  FRINGE  BENEFITS.  (A)  ALLOWANCE  OF CREDIT. FOR THE TAXABLE YEAR
COMMENCING ON JANUARY FIRST, TWO THOUSAND FOURTEEN, A  TAXPAYER  SUBJECT
TO   TAX   UNDER   ARTICLE   NINE,  NINE-A,  TWENTY-TWO,  THIRTY-TWO  OR
THIRTY-THREE OF THIS CHAPTER SHALL BE ALLOWED A CREDIT AGAINST SUCH TAX,
PURSUANT TO  THE  PROVISIONS  REFERENCED  IN  SUBDIVISION  (D)  OF  THIS
SECTION.  THE  CREDIT  SHALL BE ALLOWED WHERE A TAXPAYER HAS ESTABLISHED
AND IMPLEMENTED FEDERAL QUALIFIED TRANSPORTATION FRINGE BENEFITS FOR ITS
EMPLOYEES DURING THE TAXABLE YEAR IN WHICH SUCH CREDIT IS  CLAIMED,  AND
THE  TAXPAYER HAS NOT PROVIDED SUCH BENEFITS TO ITS EMPLOYEES DURING ANY
PRIOR TAXABLE YEAR. THE CREDIT SHALL BE EQUAL TO FIFTY DOLLARS FOR  EACH
EMPLOYEE  OF  THE  TAXPAYER WHO ELECTED TO PARTICIPATE IN THE TAXPAYER'S
FEDERAL QUALIFIED TRANSPORTATION  FRINGE  BENEFITS  PROGRAM  DURING  THE
TAXABLE  YEAR  IN WHICH SUCH PROGRAM IS ESTABLISHED BY THE TAXPAYER. THE
AMOUNT OF THE CREDIT GRANTED TO ANY TAXPAYER PURSUANT  TO  THIS  SECTION
SHALL NOT EXCEED FIFTY THOUSAND DOLLARS.
  (B)  DEFINITION. AS USED IN THIS SECTION, "FEDERAL QUALIFIED TRANSPOR-
TATION FRINGE BENEFITS" MEANS A QUALIFIED FEDERAL TRANSPORTATION  FRINGE
BENEFITS PROGRAM ESTABLISHED AND IMPLEMENTED BY A TAXPAYER IN ACCORDANCE
WITH  SECTION  132(F)  OF  THE INTERNAL REVENUE CODE AND THE REGULATIONS
ADOPTED PURSUANT THERETO.  EVERY SUCH PROGRAM SHALL BE ADMINISTERED BY A
THIRD PARTY PROGRAM ADMINISTRATOR.
  (C) CROSS REFERENCES. FOR APPLICATION OF THE CREDIT  PROVIDED  FOR  IN
THIS SECTION, SEE THE FOLLOWING PROVISIONS OF THIS CHAPTER:

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD13197-02-4

S. 6737                             2

  (1) ARTICLE 9: SECTION 187-T,
  (2) ARTICLE 9-A: SECTION 210, SUBDIVISION 48,
  (3) ARTICLE 22: SECTION 606, SUBSECTIONS (I) AND (U),
  (4) ARTICLE 32: SECTION 1456, SUBSECTION (AA),
  (5) ARTICLE 33: SECTION 1511, SUBDIVISION (DD).
  (D)  ALLOCATION  OF CREDIT. THE AGGREGATE OF TAX CREDITS ALLOWED UNDER
THIS  SECTION,   SECTION   ONE   HUNDRED   EIGHTY-SEVEN-T,   SUBDIVISION
FORTY-EIGHT  OF SECTION TWO HUNDRED TEN, CLAUSE (XXXVII) OF SUBPARAGRAPH
(B) OF PARAGRAPH ONE OF SUBSECTION (I) AND SUBSECTION (U) OF SECTION SIX
HUNDRED SIX, SUBSECTION (AA) OF SECTION FOURTEEN HUNDRED  FIFTY-SIX  AND
SUBDIVISION (DD) OF SECTION FIFTEEN HUNDRED ELEVEN OF THIS CHAPTER SHALL
NOT EXCEED FIVE MILLION DOLLARS.
  S  2.  The tax law is amended by adding a new section 187-t to read as
follows:
  S 187-T. CREDIT FOR PROVISION OF EMPLOYEE FEDERAL QUALIFIED  TRANSPOR-
TATION  FRINGE  BENEFITS.  1.  ALLOWANCE  OF CREDIT. A TAXPAYER SHALL BE
ALLOWED A CREDIT, TO BE COMPUTED AS PROVIDED  IN  SECTION  FORTY-ONE  OF
THIS  CHAPTER, AGAINST THE TAXES IMPOSED BY SECTIONS ONE HUNDRED EIGHTY-
THREE, ONE HUNDRED EIGHTY-FOUR AND ONE HUNDRED EIGHTY-FIVE OF THIS ARTI-
CLE.   PROVIDED, HOWEVER, THAT  THE  AMOUNT  OF  SUCH  CREDIT  ALLOWABLE
AGAINST THE TAX IMPOSED BY SECTION ONE HUNDRED EIGHTY-FOUR OF THIS ARTI-
CLE  SHALL BE THE EXCESS OF THE AMOUNT OF SUCH CREDIT OVER THE AMOUNT OF
ANY CREDIT ALLOWED BY THIS SECTION AGAINST THE TAX  IMPOSED  BY  SECTION
ONE HUNDRED EIGHTY-THREE OF THIS ARTICLE.
  2.  APPLICATION  OF  CREDIT.  IN  NO EVENT SHALL THE CREDIT UNDER THIS
SECTION BE ALLOWED IN AN AMOUNT WHICH WILL REDUCE  THE  TAX  PAYABLE  TO
LESS THAN THE APPLICABLE MINIMUM TAX FIXED BY SECTION ONE HUNDRED EIGHT-
Y-THREE OR ONE HUNDRED EIGHTY-FIVE OF THIS ARTICLE.
  S 3. Section 210 of the tax law is amended by adding a new subdivision
48 to read as follows:
  48.  CREDIT FOR PROVISION OF EMPLOYEE FEDERAL QUALIFIED TRANSPORTATION
FRINGE BENEFITS. (A) ALLOWANCE OF CREDIT. A TAXPAYER SHALL BE ALLOWED  A
CREDIT, TO BE COMPUTED AS PROVIDED IN SECTION FORTY-ONE OF THIS CHAPTER,
AGAINST THE TAX IMPOSED BY THIS ARTICLE.
  (B)  APPLICATION  OF CREDIT. THE CREDIT ALLOWED UNDER THIS SUBDIVISION
SHALL NOT REDUCE THE TAX DUE TO LESS THAN  THE  HIGHER  OF  THE  AMOUNTS
PRESCRIBED IN PARAGRAPHS (C) AND (D) OF SUBDIVISION ONE OF THIS SECTION.
  S  4. Subparagraph (B) of paragraph 1 of subsection (i) of section 606
of the tax law is amended by adding a new clause  (xxxvii)  to  read  as
follows:
(XXXVII) CREDIT FOR PROVISION OF     AMOUNT OF CREDIT UNDER SUBDIVISION
EMPLOYEE FEDERAL QUALIFIED           FORTY-EIGHT OF SECTION TWO HUNDRED
TRANSPORTATION FRINGE BENEFITS       TEN, SUBSECTION (AA) OF SECTION
UNDER SUBSECTION (U)                 FOURTEEN HUNDRED FIFTY-SIX OR
                                     SUBDIVISION (DD) OF SECTION FIFTEEN
                                     HUNDRED ELEVEN
  S  5. Section 606 of the tax law is amended by adding a new subsection
(u) to read as follows:
  (U) CREDIT FOR PROVISION OF EMPLOYEE FEDERAL QUALIFIED  TRANSPORTATION
FRINGE  BENEFITS.  ALLOWANCE  OF  CREDIT.  A TAXPAYER SHALL BE ALLOWED A
CREDIT, TO BE COMPUTED AS PROVIDED IN SECTION FORTY-ONE OF THIS CHAPTER,
AGAINST THE TAX IMPOSED BY THIS ARTICLE.
  S 6. Section 1456 of the tax law is amended by adding a new subsection
(aa) to read as follows:
  (AA) CREDIT FOR PROVISION OF EMPLOYEE FEDERAL QUALIFIED TRANSPORTATION
FRINGE BENEFITS. (1) ALLOWANCE OF CREDIT. A TAXPAYER SHALL BE ALLOWED  A

S. 6737                             3

CREDIT, TO BE COMPUTED AS PROVIDED IN SECTION FORTY-ONE OF THIS CHAPTER,
AGAINST THE TAX IMPOSED BY THIS ARTICLE.
  (2)  APPLICATION  OF  CREDIT. THE CREDIT ALLOWED UNDER THIS SUBSECTION
SHALL NOT REDUCE THE TAX DUE TO LESS  THAN  THE  MINIMUM  TAX  FIXED  BY
SUBSECTION (B) OF SECTION FOURTEEN HUNDRED FIFTY-FIVE OF THIS ARTICLE.
  S  7.  Section 1511 of the tax law is amended by adding a new subdivi-
sion (dd) to read as follows:
  (DD) CREDIT FOR PROVISION OF EMPLOYEE FEDERAL QUALIFIED TRANSPORTATION
FRINGE BENEFITS. (1) ALLOWANCE OF CREDIT. A TAXPAYER SHALL BE ALLOWED  A
CREDIT, TO BE COMPUTED AS PROVIDED IN SECTION FORTY-ONE OF THIS CHAPTER,
AGAINST THE TAXES IMPOSED BY THIS ARTICLE.
  (2)  APPLICATION  OF CREDIT. THE CREDIT ALLOWED UNDER THIS SUBDIVISION
SHALL NOT REDUCE THE TAX DUE TO LESS THAN THE MINIMUM TAX FIXED BY PARA-
GRAPH FOUR OF SUBDIVISION (A) OF SECTION FIFTEEN  HUNDRED  TWO  OF  THIS
ARTICLE  OR  BY SECTION FIFTEEN HUNDRED TWO-A OF THIS ARTICLE, WHICHEVER
IS APPLICABLE.
  S 8. This act shall take effect immediately.

Co-Sponsors

S6737A - Bill Details

Current Committee:
Law Section:
Tax Law
Laws Affected:
Add §§42 & 187-t, amd §§210, 606, 1456 & 1511, Tax L

S6737A - Bill Texts

view summary

Establishes corporate, business franchise, personal, insurance and banking tax credits for the provision of employee federal qualified transportation fringe benefits.

view sponsor memo
BILL NUMBER:S6737A

TITLE OF BILL: An act to amend the tax law, in relation to
establishing tax credits for taxpayers which provide their employees
with access to federal qualified transportation fringe benefits

PURPOSE:

To provide businesses with a tax credit as an incentive to offer their
employees federal qualified transportation benefits.

SUMMARY OF PROVISIONS:

Section 1 adds a new section 42 to the tax law. This section gives
filers who file under articles nine, nine-A, twenty-two, thirty-two,
or thirty-three of the tax law a credit against such taxes in tax year
2014. The credit is equal to $50 for each employee who elects to
participate in a qualified fringe transportation benefit program
offered by the employer, as defined by section 132(f) of the Internal
Revenue Code. This credit can be claimed only by an employer who
establishes such a program on the tax year they claimed the credit for
without having offered such a program previously. The maximum credit
any tax payer can claim is $50,000. The maximum amount which can be
claimed for this credit by all filers is $5 million.

Section 2 adds a new section 187-t of the tax law to establish the
credit explained above in article nine of the tax law.

Section 3 amends section 210 of the tax law by adding a new
subdivision 50 to establish the credit explained above in article
nine-A of the tax law.

Section 4 amends subparagraph (B) of paragraph 1 of subsection (i) of
section 606 of the tax law by adding a new clause (xli) to establish
the credit explained above to article 22 of the tax law.

Section 5 amends section 606 of the tax law by adding a new subsection
(v) to add this credit to the list of credits that can be claimed
under this section of the law.

Section 6 amends section 1456 of the tax law by adding a new
subsection (aa) to establish the credit explained above to article
thirty-two of the tax law.

Section 7 amends section 1511 of the tax law by adding a new
subdivision (dd) to establish the credit explained above to article
thirty-three of the tax law.

Section 8 establishes an immediate effective date.

JUSTIFICATION:

Every day over 8.9 million New Yorkers commute to work. Commuting
costs can quickly add up and eat up an important chunk of an
individual's annual budget. New York state is unique in the number of
employees who commute using public transportation. According to the
Bureau of Labor, in the 2011-2012 period the average expenditure in


transportation in the New York Metropolitan statistical region was
around $8,000 a year, with the expense on mass transit being an
average of $1,142.

In order to help pay for commuting expenses, federal tax law allows
employers to offer a benefit that sets aside pre-taxable income with
which employees can pay for eligible commuting expenses. Each year the
IRS sets the limit for how much income an employee can set aside to
pay for qualifying transportation expenses. For tax year 2014,
employees can set aside up to $250 a month in income to pay for
qualifying parking expenses related to an individual's parking
expenses at work, and up to $130 a month to pay for transit expenses
like paying for mass transit or commuter van service. An employee may
also receive a $20 a month for qualified bicycling expenses.

The income that is set aside each month is exempt from all taxation,
including payroll taxes and federal, state, and local income taxes.
This means that the employees tax bill is lowered by hundreds of
dollars, with the specific savings determined by how much income is
set aside and the income tax status of the employee. The employer also
saves money, since the salary put side is exempted from the employer
share of payroll taxes. Unfortunately, even though employers can save
money as well, according to the Bureau of Labor survey of employee
benefits only 8% of employees in the Northeast region have access to
this benefit. This declines to only 3% of employers with under 100
employees offer this benefit.

Businesses provide this fringe benefit by working with third party
program administrators who administrate the program. There are some
minor administrative fees that employers pay, as well as paperwork to
be filed in order to begin offering the benefit. While these
administrative costs would be easily recouped in the vast majority of
cases just from the tax benefit the employers get plus ancillary
benefits such as improving employee satisfaction, they can lead to
some employers choosing not to offer these benefits. The tax credit
proposed is meant to give businesses an incentive to establish these
programs and offer them to their employees by more than covering
whatever up-front costs they would have to deal with in establishing
the program. If employers in New York make full use of this credit,
100,000 workers in New York would gain access to this benefit, and see
their commuting costs cut. Those businesses who establish these
Programs would then reap the benefits in following years.

LEGISLATIVE HISTORY:

New bill.

FISCAL IMPLICATIONS:

The credit amount to be offered is capped at $5 million. Since the
benefit allows employees to deduct income set aside income used for
qualified expenses from taxes, there would be an additional associated
cost to the state in the form of lost income tax revenue. If the
program is fully utilized, we estimate there could be a concurrent
loss of $14 million in income tax revenue to the state.

EFFECTIVE DATE:


This act shall take effect immediately.

view full text
download pdf
                    S T A T E   O F   N E W   Y O R K
________________________________________________________________________

                                 6737--A

                            I N  S E N A T E

                              March 5, 2014
                               ___________

Introduced  by  Sens. CARLUCCI, KLEIN, SAVINO, VALESKY -- read twice and
  ordered printed, and when printed to be committed to the Committee  on
  Investigations and Government Operations -- committee discharged, bill
  amended,  ordered reprinted as amended and recommitted to said commit-
  tee

AN ACT to amend the tax law, in relation to establishing tax credits for
  taxpayers which provide their employees with access to federal  quali-
  fied transportation fringe benefits

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

  Section 1. The tax law is amended by adding a new section 42  to  read
as follows:
  S  42.  CREDIT FOR PROVISION OF EMPLOYEE FEDERAL QUALIFIED TRANSPORTA-
TION FRINGE BENEFITS. (A) ALLOWANCE OF  CREDIT.  FOR  THE  TAXABLE  YEAR
COMMENCING  ON  JANUARY FIRST, TWO THOUSAND FOURTEEN, A TAXPAYER SUBJECT
TO  TAX  UNDER  ARTICLE  NINE,   NINE-A,   TWENTY-TWO,   THIRTY-TWO   OR
THIRTY-THREE OF THIS CHAPTER SHALL BE ALLOWED A CREDIT AGAINST SUCH TAX,
PURSUANT  TO  THE  PROVISIONS  REFERENCED  IN  SUBDIVISION  (D)  OF THIS
SECTION. THE CREDIT SHALL BE ALLOWED WHERE A  TAXPAYER  HAS  ESTABLISHED
AND IMPLEMENTED FEDERAL QUALIFIED TRANSPORTATION FRINGE BENEFITS FOR ITS
EMPLOYEES  DURING  THE TAXABLE YEAR IN WHICH SUCH CREDIT IS CLAIMED, AND
THE TAXPAYER HAS NOT PROVIDED SUCH BENEFITS TO ITS EMPLOYEES DURING  ANY
PRIOR  TAXABLE YEAR. THE CREDIT SHALL BE EQUAL TO FIFTY DOLLARS FOR EACH
EMPLOYEE OF THE TAXPAYER WHO ELECTED TO PARTICIPATE  IN  THE  TAXPAYER'S
FEDERAL  QUALIFIED  TRANSPORTATION  FRINGE  BENEFITS  PROGRAM DURING THE
TAXABLE YEAR IN WHICH SUCH PROGRAM IS ESTABLISHED BY THE  TAXPAYER.  THE
AMOUNT  OF  THE  CREDIT GRANTED TO ANY TAXPAYER PURSUANT TO THIS SECTION
SHALL NOT EXCEED FIFTY THOUSAND DOLLARS.
  (B) DEFINITION. AS USED IN THIS SECTION, "FEDERAL QUALIFIED  TRANSPOR-
TATION  FRINGE BENEFITS" MEANS A QUALIFIED FEDERAL TRANSPORTATION FRINGE
BENEFITS PROGRAM ESTABLISHED AND IMPLEMENTED BY A TAXPAYER IN ACCORDANCE
WITH SECTION 132(F) OF THE INTERNAL REVENUE  CODE  AND  THE  REGULATIONS
ADOPTED PURSUANT THERETO.  EVERY SUCH PROGRAM SHALL BE ADMINISTERED BY A
THIRD PARTY PROGRAM ADMINISTRATOR.

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD13197-04-4

S. 6737--A                          2

  (C)  CROSS  REFERENCES.  FOR APPLICATION OF THE CREDIT PROVIDED FOR IN
THIS SECTION, SEE THE FOLLOWING PROVISIONS OF THIS CHAPTER:
  (1) ARTICLE 9: SECTION 187-T,
  (2) ARTICLE 9-A: SECTION 210, SUBDIVISION 50,
  (3) ARTICLE 22: SECTION 606, SUBSECTIONS (I) AND (V),
  (4) ARTICLE 32: SECTION 1456, SUBSECTION (AA),
  (5) ARTICLE 33: SECTION 1511, SUBDIVISION (DD).
  (D)  ALLOCATION  OF CREDIT. THE AGGREGATE OF TAX CREDITS ALLOWED UNDER
THIS SECTION, SECTION ONE HUNDRED EIGHTY-SEVEN-T, SUBDIVISION  FIFTY  OF
SECTION  TWO  HUNDRED TEN, CLAUSE (XLI) OF SUBPARAGRAPH (B) OF PARAGRAPH
ONE OF SUBSECTION (I) AND SUBSECTION (V) OF  SECTION  SIX  HUNDRED  SIX,
SUBSECTION  (AA)  OF  SECTION FOURTEEN HUNDRED FIFTY-SIX AND SUBDIVISION
(DD) OF SECTION FIFTEEN HUNDRED ELEVEN OF THIS CHAPTER SHALL NOT  EXCEED
FIVE MILLION DOLLARS.
  S  2.  The tax law is amended by adding a new section 187-t to read as
follows:
  S 187-T. CREDIT FOR PROVISION OF EMPLOYEE FEDERAL QUALIFIED  TRANSPOR-
TATION  FRINGE  BENEFITS.  1.  ALLOWANCE  OF CREDIT. A TAXPAYER SHALL BE
ALLOWED A CREDIT, TO BE COMPUTED AS PROVIDED  IN  SECTION  FORTY-TWO  OF
THIS  CHAPTER, AGAINST THE TAXES IMPOSED BY SECTIONS ONE HUNDRED EIGHTY-
THREE, ONE HUNDRED EIGHTY-FOUR AND ONE HUNDRED EIGHTY-FIVE OF THIS ARTI-
CLE.   PROVIDED, HOWEVER, THAT  THE  AMOUNT  OF  SUCH  CREDIT  ALLOWABLE
AGAINST THE TAX IMPOSED BY SECTION ONE HUNDRED EIGHTY-FOUR OF THIS ARTI-
CLE  SHALL BE THE EXCESS OF THE AMOUNT OF SUCH CREDIT OVER THE AMOUNT OF
ANY CREDIT ALLOWED BY THIS SECTION AGAINST THE TAX  IMPOSED  BY  SECTION
ONE HUNDRED EIGHTY-THREE OF THIS ARTICLE.
  2.  APPLICATION  OF  CREDIT.  IN  NO EVENT SHALL THE CREDIT UNDER THIS
SECTION BE ALLOWED IN AN AMOUNT WHICH WILL REDUCE  THE  TAX  PAYABLE  TO
LESS THAN THE APPLICABLE MINIMUM TAX FIXED BY SECTION ONE HUNDRED EIGHT-
Y-THREE OR ONE HUNDRED EIGHTY-FIVE OF THIS ARTICLE.
  S 3. Section 210 of the tax law is amended by adding a new subdivision
50 to read as follows:
  50.  CREDIT FOR PROVISION OF EMPLOYEE FEDERAL QUALIFIED TRANSPORTATION
FRINGE BENEFITS. (A) ALLOWANCE OF CREDIT. A TAXPAYER SHALL BE ALLOWED  A
CREDIT, TO BE COMPUTED AS PROVIDED IN SECTION FORTY-TWO OF THIS CHAPTER,
AGAINST THE TAX IMPOSED BY THIS ARTICLE.
  (B)  APPLICATION  OF CREDIT. THE CREDIT ALLOWED UNDER THIS SUBDIVISION
SHALL NOT REDUCE THE TAX DUE TO LESS THAN  THE  HIGHER  OF  THE  AMOUNTS
PRESCRIBED IN PARAGRAPHS (C) AND (D) OF SUBDIVISION ONE OF THIS SECTION.
  S  4. Subparagraph (B) of paragraph 1 of subsection (i) of section 606
of the tax law is amended by adding  a  new  clause  (xli)  to  read  as
follows:
(XLI) CREDIT FOR PROVISION OF        AMOUNT OF CREDIT UNDER SUBDIVISION
EMPLOYEE FEDERAL QUALIFIED           FIFTY OF SECTION TWO HUNDRED
TRANSPORTATION FRINGE BENEFITS       TEN, SUBSECTION (AA) OF SECTION
UNDER SUBSECTION (V)                 FOURTEEN HUNDRED FIFTY-SIX OR
                                     SUBDIVISION (DD) OF SECTION FIFTEEN
                                     HUNDRED ELEVEN
  S  5. Section 606 of the tax law is amended by adding a new subsection
(v) to read as follows:
  (V) CREDIT FOR PROVISION OF EMPLOYEE FEDERAL QUALIFIED  TRANSPORTATION
FRINGE  BENEFITS.  ALLOWANCE  OF  CREDIT.  A TAXPAYER SHALL BE ALLOWED A
CREDIT, TO BE COMPUTED AS PROVIDED IN SECTION FORTY-TWO OF THIS CHAPTER,
AGAINST THE TAX IMPOSED BY THIS ARTICLE.
  S 6. Section 1456 of the tax law is amended by adding a new subsection
(aa) to read as follows:

S. 6737--A                          3

  (AA) CREDIT FOR PROVISION OF EMPLOYEE FEDERAL QUALIFIED TRANSPORTATION
FRINGE BENEFITS. (1) ALLOWANCE OF CREDIT. A TAXPAYER SHALL BE ALLOWED  A
CREDIT, TO BE COMPUTED AS PROVIDED IN SECTION FORTY-TWO OF THIS CHAPTER,
AGAINST THE TAX IMPOSED BY THIS ARTICLE.
  (2)  APPLICATION  OF  CREDIT. THE CREDIT ALLOWED UNDER THIS SUBSECTION
SHALL NOT REDUCE THE TAX DUE TO LESS  THAN  THE  MINIMUM  TAX  FIXED  BY
SUBSECTION (B) OF SECTION FOURTEEN HUNDRED FIFTY-FIVE OF THIS ARTICLE.
  S  7.  Section 1511 of the tax law is amended by adding a new subdivi-
sion (dd) to read as follows:
  (DD) CREDIT FOR PROVISION OF EMPLOYEE FEDERAL QUALIFIED TRANSPORTATION
FRINGE BENEFITS. (1) ALLOWANCE OF CREDIT. A TAXPAYER SHALL BE ALLOWED  A
CREDIT, TO BE COMPUTED AS PROVIDED IN SECTION FORTY-TWO OF THIS CHAPTER,
AGAINST THE TAXES IMPOSED BY THIS ARTICLE.
  (2)  APPLICATION  OF CREDIT. THE CREDIT ALLOWED UNDER THIS SUBDIVISION
SHALL NOT REDUCE THE TAX DUE TO LESS THAN THE MINIMUM TAX FIXED BY PARA-
GRAPH FOUR OF SUBDIVISION (A) OF SECTION FIFTEEN  HUNDRED  TWO  OF  THIS
ARTICLE  OR  BY SECTION FIFTEEN HUNDRED TWO-A OF THIS ARTICLE, WHICHEVER
IS APPLICABLE.
  S 8. This act shall take effect immediately; provided,  however,  that
the amendment to section 1456 of the tax law made by section six of this
act  shall  not  affect  the  repeal of such section and shall be deemed
repealed therewith.

Co-Sponsors

S6737B (ACTIVE) - Bill Details

Current Committee:
Law Section:
Tax Law
Laws Affected:
Add §§42 & 187-t, amd §§210, 606, 1456 & 1511, Tax L

S6737B (ACTIVE) - Bill Texts

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Establishes corporate, business franchise, personal, insurance and banking tax credits for the provision of employee federal qualified transportation fringe benefits.

view sponsor memo
BILL NUMBER:S6737B

TITLE OF BILL: An act to amend the tax law, in relation to
establishing tax credits for taxpayers which provide their employees
with access to federal qualified transportation fringe benefits

PURPOSE: To provide businesses with a tax credit as an incentive to
offer their employees federal qualified transportation benefits.

SUMMARY OF PROVISIONS: Section 1 adds a new section 42 to the tax law.
This section gives filers who file under articles nine, nine-A,
twenty-two, thirty-two, or thirty-three of the tax law a credit
against such taxes in tax year 2014. The credit is equal to $50 for
each employee who elects to participate in a qualified fringe
transportation benefit program offered by the employer, as defined by
section 132(f) of the Internal Revenue Code. This credit can be
claimed only by an employer who establishes such a program on the tax
year they claimed the credit for without having offered such a program
previously. The maximum credit any tax payer can claim is $50,000. The
maximum amount which can be claimed for this credit by all filers is
$5 million.

Section 2 adds a new section 187-t of the tax law to establish the
credit explained above in article nine of the tax law.

Section 3 amends section 210 of the tax law by adding a new
subdivision 50 to establish the credit explained above in article
nine-A of the tax law.

Section 4 amends subparagraph (B) of paragraph 1 of subsection (i) of
section 606 of the tax law by adding a new clause (xli) to establish
the credit explained above to article 22 of the tax law.

Section 5 amends section 606 of the tax law by adding a new subsection
(v) to add this credit to the list of credits that can be claimed
under this section of the law.

Section 6 amends section 1456 of the tax law by adding a new
subsection (aa) to establish the credit explained above to article
thirty-two of the tax law.

Section 7 amends section 1511 of the tax law by adding a new
subdivision (dd) to establish the credit explained above to article
thirty-three of the tax law.

Section 8 establishes an immediate effective date.

JUSTIFICATION: Every day over 8.9 million New Yorkers
work. Commuting costs can quickly add up and eat up an important chunk
of an individual's annual budget. New York state is unique in the
number of employees who commute using public transportation.
According to the Bureau of Labor, in the 2011-2012 period the average
expenditure in transportation in the New York Metropolitan statistical
region was around $8,000 a year, with the expense on mass transit
being an average of $1,142.


In order to help pay for commuting expenses, federal tax law allows
employers to offer a benefit that sets aside pre-taxable income with
which employees can pay for eligible commuting expenses. Each year the
IRS sets the limit for how much income an employee can set aside to
pay for qualifying transportation expenses. For tax year 2014,
employees can set aside up to $250 a month in income to pay for
qualifying parking expenses related to an individual's parking
expenses at work, and up to $130 a month to pay for transit expenses
like paying for mass transit or commuter van service. An employee may
also receive a $20 a month for qualified bicycling expenses.

The income that is set aside each month is exempt from all taxation,
including payroll taxes and federal, state, and local income taxes.
This means that the employees tax bill is lowered by hundreds of
dollars, with the specific savings determined by how much income is
set aside and the income tax status of the employee. The employer also
saves money, since the salary put side is exempted from the employer
share of payroll taxes. Unfortunately, even though employers can save
money as well, according to the Bureau of Labor survey of employee
benefits only 8% of employees in the Northeast region have access to
this benefit. This declines to only 3% of employers with under 100
employees offer this benefit.

Businesses provide this fringe benefit by working with third party
program administrators who administrate the program. There are some
minor administrative fees that employers pay, as well as paperwork to
be filed in order to begin offering the benefit. While these
administrative costs would be easily recouped in the vast majority of
cases just from the tax benefit the employers get plus ancillary
benefits such as improving employee satisfaction, they can lead to
some employers choosing not to offer these benefits. The tax credit
proposed is meant to give businesses an incentive to establish these
programs and offer them to their employees by more than covering
whatever up-front costs they would have to deal with in establishing
the program. If employers in New York make full use of this credit,
100,000 workers in New York would gain access to this benefit, and see
their commuting costs cut. Those businesses who establish these
Programs would then reap the benefits in following years.

LEGISLATIVE HISTORY: New bill.

FISCAL IMPLICATIONS: The credit amount to be offered is capped at $5
million. Since the benefit allows employees to deduct income set aside
income used for qualified expenses from taxes, there would be an
additional associated cost to the state in the form of lost income tax
revenue. If the program is fully utilized, we estimate there could be
a concurrent loss of $14 million in income tax revenue to the state.

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
________________________________________________________________________

                                 6737--B

                            I N  S E N A T E

                              March 5, 2014
                               ___________

Introduced  by  Sens. CARLUCCI, KLEIN, SAVINO, VALESKY -- read twice and
  ordered printed, and when printed to be committed to the Committee  on
  Investigations and Government Operations -- committee discharged, bill
  amended,  ordered reprinted as amended and recommitted to said commit-
  tee --  committee  discharged,  bill  amended,  ordered  reprinted  as
  amended and recommitted to said committee

AN ACT to amend the tax law, in relation to establishing tax credits for
  taxpayers  which provide their employees with access to federal quali-
  fied transportation fringe benefits

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

  Section  1.  The tax law is amended by adding a new section 42 to read
as follows:
  S 42. CREDIT FOR PROVISION OF EMPLOYEE FEDERAL  QUALIFIED  TRANSPORTA-
TION  FRINGE  BENEFITS.  (A)  ALLOWANCE  OF CREDIT. FOR THE TAXABLE YEAR
COMMENCING ON JANUARY FIRST, TWO THOUSAND FOURTEEN, A  TAXPAYER  SUBJECT
TO   TAX   UNDER   ARTICLE   NINE,  NINE-A,  TWENTY-TWO,  THIRTY-TWO  OR
THIRTY-THREE OF THIS CHAPTER SHALL BE ALLOWED A CREDIT AGAINST SUCH TAX,
PURSUANT TO  THE  PROVISIONS  REFERENCED  IN  SUBDIVISION  (D)  OF  THIS
SECTION.  THE  CREDIT  SHALL BE ALLOWED WHERE A TAXPAYER HAS ESTABLISHED
AND IMPLEMENTED FEDERAL QUALIFIED TRANSPORTATION FRINGE BENEFITS FOR ITS
EMPLOYEES DURING THE TAXABLE YEAR IN WHICH SUCH CREDIT IS  CLAIMED,  AND
THE  TAXPAYER HAS NOT PROVIDED SUCH BENEFITS TO ITS EMPLOYEES DURING ANY
PRIOR TAXABLE YEAR. THE CREDIT SHALL BE EQUAL TO FIFTY DOLLARS FOR  EACH
EMPLOYEE  OF  THE  TAXPAYER WHO ELECTED TO PARTICIPATE IN THE TAXPAYER'S
FEDERAL QUALIFIED TRANSPORTATION  FRINGE  BENEFITS  PROGRAM  DURING  THE
TAXABLE  YEAR  IN WHICH SUCH PROGRAM IS ESTABLISHED BY THE TAXPAYER. THE
AMOUNT OF THE CREDIT GRANTED TO ANY TAXPAYER PURSUANT  TO  THIS  SECTION
SHALL NOT EXCEED FIFTY THOUSAND DOLLARS.
  (B)  DEFINITION. AS USED IN THIS SECTION, "FEDERAL QUALIFIED TRANSPOR-
TATION FRINGE BENEFITS" MEANS A QUALIFIED FEDERAL TRANSPORTATION  FRINGE
BENEFITS PROGRAM ESTABLISHED AND IMPLEMENTED BY A TAXPAYER IN ACCORDANCE
WITH  SECTION  132(F)  OF  THE INTERNAL REVENUE CODE AND THE REGULATIONS

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD13197-05-4

S. 6737--B                          2

ADOPTED PURSUANT THERETO.  EVERY SUCH PROGRAM SHALL BE ADMINISTERED BY A
THIRD PARTY PROGRAM ADMINISTRATOR.
  (C)  CROSS  REFERENCES.  FOR APPLICATION OF THE CREDIT PROVIDED FOR IN
THIS SECTION, SEE THE FOLLOWING PROVISIONS OF THIS CHAPTER:
  (1) ARTICLE 9: SECTION 187-T,
  (2) ARTICLE 9-A: SECTION 210, SUBDIVISION 50,
  (3) ARTICLE 22: SECTION 606, SUBSECTIONS (I) AND (V),
  (4) ARTICLE 32: SECTION 1456, SUBSECTION (AA),
  (5) ARTICLE 33: SECTION 1511, SUBDIVISION (DD).
  (D) ALLOCATION OF CREDIT. THE AGGREGATE OF TAX CREDITS  ALLOWED  UNDER
THIS  SECTION,  SECTION ONE HUNDRED EIGHTY-SEVEN-T, SUBDIVISION FIFTY OF
SECTION TWO HUNDRED TEN, CLAUSE (XLI) OF SUBPARAGRAPH (B)  OF  PARAGRAPH
ONE  OF  SUBSECTION  (I)  AND SUBSECTION (V) OF SECTION SIX HUNDRED SIX,
SUBSECTION (AA) OF SECTION FOURTEEN HUNDRED  FIFTY-SIX  AND  SUBDIVISION
(DD)  OF SECTION FIFTEEN HUNDRED ELEVEN OF THIS CHAPTER SHALL NOT EXCEED
FIVE MILLION DOLLARS.
  S 2. The tax law is amended by adding a new section 187-t to  read  as
follows:
  S  187-T. CREDIT FOR PROVISION OF EMPLOYEE FEDERAL QUALIFIED TRANSPOR-
TATION FRINGE BENEFITS. 1. ALLOWANCE OF  CREDIT.  A  TAXPAYER  SHALL  BE
ALLOWED  A  CREDIT,  TO  BE COMPUTED AS PROVIDED IN SECTION FORTY-TWO OF
THIS CHAPTER, AGAINST THE TAXES IMPOSED BY SECTIONS ONE HUNDRED  EIGHTY-
THREE, ONE HUNDRED EIGHTY-FOUR AND ONE HUNDRED EIGHTY-FIVE OF THIS ARTI-
CLE.    PROVIDED,  HOWEVER,  THAT  THE  AMOUNT  OF SUCH CREDIT ALLOWABLE
AGAINST THE TAX IMPOSED BY SECTION ONE HUNDRED EIGHTY-FOUR OF THIS ARTI-
CLE SHALL BE THE EXCESS OF THE AMOUNT OF SUCH CREDIT OVER THE AMOUNT  OF
ANY  CREDIT  ALLOWED  BY THIS SECTION AGAINST THE TAX IMPOSED BY SECTION
ONE HUNDRED EIGHTY-THREE OF THIS ARTICLE.
  2. APPLICATION OF CREDIT. IN NO EVENT  SHALL  THE  CREDIT  UNDER  THIS
SECTION  BE  ALLOWED  IN  AN AMOUNT WHICH WILL REDUCE THE TAX PAYABLE TO
LESS THAN THE APPLICABLE MINIMUM TAX FIXED BY SECTION ONE HUNDRED EIGHT-
Y-THREE OR ONE HUNDRED EIGHTY-FIVE OF THIS ARTICLE.
  S 3. Section 210 of the tax law is amended by adding a new subdivision
50 to read as follows:
  50. CREDIT FOR PROVISION OF EMPLOYEE FEDERAL QUALIFIED  TRANSPORTATION
FRINGE  BENEFITS. (A) ALLOWANCE OF CREDIT. A TAXPAYER SHALL BE ALLOWED A
CREDIT, TO BE COMPUTED AS PROVIDED IN SECTION FORTY-TWO OF THIS CHAPTER,
AGAINST THE TAX IMPOSED BY THIS ARTICLE.
  (B) APPLICATION OF CREDIT. THE CREDIT ALLOWED UNDER  THIS  SUBDIVISION
SHALL  NOT  REDUCE  THE  TAX  DUE TO LESS THAN THE HIGHER OF THE AMOUNTS
PRESCRIBED IN PARAGRAPHS (C) AND (D) OF SUBDIVISION ONE OF THIS SECTION.
  S 4. Subparagraph (B) of paragraph 1 of subsection (i) of section  606
of  the  tax  law  is  amended  by  adding a new clause (xli) to read as
follows:
(XLI) CREDIT FOR PROVISION OF        AMOUNT OF CREDIT UNDER SUBDIVISION
EMPLOYEE FEDERAL QUALIFIED           FIFTY OF SECTION TWO HUNDRED
TRANSPORTATION FRINGE BENEFITS       TEN, SUBSECTION (AA) OF SECTION
UNDER SUBSECTION (V)                 FOURTEEN HUNDRED FIFTY-SIX OR
                                     SUBDIVISION (DD) OF SECTION FIFTEEN
                                     HUNDRED ELEVEN
  S 5. Section 606 of the tax law is amended by adding a new  subsection
(v) to read as follows:
  (V)  CREDIT FOR PROVISION OF EMPLOYEE FEDERAL QUALIFIED TRANSPORTATION
FRINGE BENEFITS. ALLOWANCE OF CREDIT. A  TAXPAYER  SHALL  BE  ALLOWED  A
CREDIT, TO BE COMPUTED AS PROVIDED IN SECTION FORTY-TWO OF THIS CHAPTER,
AGAINST THE TAX IMPOSED BY THIS ARTICLE.

S. 6737--B                          3

  S 6. Section 1456 of the tax law is amended by adding a new subsection
(aa) to read as follows:
  (AA) CREDIT FOR PROVISION OF EMPLOYEE FEDERAL QUALIFIED TRANSPORTATION
FRINGE  BENEFITS. (1) ALLOWANCE OF CREDIT. A TAXPAYER SHALL BE ALLOWED A
CREDIT, TO BE COMPUTED AS PROVIDED IN SECTION FORTY-TWO OF THIS CHAPTER,
AGAINST THE TAX IMPOSED BY THIS ARTICLE.
  (2) APPLICATION OF CREDIT. THE CREDIT ALLOWED  UNDER  THIS  SUBSECTION
SHALL  NOT  REDUCE  THE  TAX  DUE  TO LESS THAN THE MINIMUM TAX FIXED BY
SUBSECTION (B) OF SECTION FOURTEEN HUNDRED FIFTY-FIVE OF THIS ARTICLE.
  S 7. Section 1511 of the tax law is amended by adding a  new  subdivi-
sion (dd) to read as follows:
  (DD) CREDIT FOR PROVISION OF EMPLOYEE FEDERAL QUALIFIED TRANSPORTATION
FRINGE  BENEFITS. (1) ALLOWANCE OF CREDIT. A TAXPAYER SHALL BE ALLOWED A
CREDIT, TO BE COMPUTED AS PROVIDED IN SECTION FORTY-TWO OF THIS CHAPTER,
AGAINST THE TAXES IMPOSED BY THIS ARTICLE.
  (2) APPLICATION OF CREDIT. THE CREDIT ALLOWED UNDER  THIS  SUBDIVISION
SHALL NOT REDUCE THE TAX DUE TO LESS THAN THE MINIMUM TAX FIXED BY PARA-
GRAPH  FOUR  OF  SUBDIVISION  (A) OF SECTION FIFTEEN HUNDRED TWO OF THIS
ARTICLE OR BY SECTION FIFTEEN HUNDRED TWO-A OF THIS  ARTICLE,  WHICHEVER
IS APPLICABLE.
  S  8.  This act shall take effect immediately; provided, however, that
the amendment to section 1456 of the tax law made by section six of this
act shall not affect the repeal of such  section  and  shall  be  deemed
repealed  therewith,  and the amendment to subparagraph (B) of paragraph
(1) of subsection (i) of section 606 of the tax law made by section four
of this act shall take effect on the same date and in the same manner as
section 68 of part A of chapter 59 of the laws of 2014.

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