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

                                  1818

                       2015-2016 Regular Sessions

                            I N  S E N A T E

                            January 15, 2015
                               ___________

Introduced  by  Sen.  PARKER -- read twice and ordered printed, and when
  printed to be committed to the Committee on Investigations and Govern-
  ment Operations

AN ACT to amend the tax law, in relation to  eliminating  net  operating
  loss carryback deductions; and to repeal certain provisions of the tax
  law relating thereto

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

  Section 1. Section 659 of the tax law, as amended by section 8 of part
J of chapter 59 of the laws of 2014, is amended to read as follows:
  S 659. Report of federal changes, corrections or disallowances. If the
amount of a taxpayer's federal taxable income, total taxable  amount  or
ordinary income portion of a lump sum distribution or includible gain of
a  trust reported on his federal income tax return for any taxable year,
or the amount of a taxpayer's earned income credit or credit for employ-
ment-related expenses set forth on such return, or  the  amount  of  any
federal  foreign  tax credit affecting the calculation of the credit for
Canadian provincial taxes  under  section  six  hundred  twenty  or  six
hundred  twenty-A  of  this article, or the amount of any claim of right
adjustment, is changed or corrected by the United States internal reven-
ue service or other competent authority or as the result of a  renegoti-
ation of a contract or subcontract with the United States, or the amount
an  employer  is  required to deduct and withhold from wages for federal
income tax withholding purposes is changed or corrected by such  service
or  authority  or  if a taxpayer's claim for credit or refund of federal
income tax is disallowed in whole or in part, the taxpayer  or  employer
shall  report  such  change  or correction or disallowance within ninety
days after the final determination of such change, correction, renegoti-
ation or disallowance, or as otherwise required by the commissioner, and
shall concede the accuracy of such determination or state wherein it  is
erroneous. [The allowance of a tentative carryback adjustment based upon

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD06923-01-5
              

S. 1818                             2

a  net  operating  loss carryback pursuant to section sixty-four hundred
eleven of the internal revenue code shall be treated as a final determi-
nation for purposes of this section.] Any  taxpayer  filing  an  amended
federal  income  tax  return  and any employer filing an amended federal
return of income tax withheld shall also file within ninety days  there-
after an amended return under this article, and shall give such informa-
tion as the commissioner may require. The commissioner may by regulation
prescribe  such  exceptions to the requirements of this section as he or
she deems appropriate. For  purposes  of  this  section,  (i)  the  term
"taxpayer"  shall  include  a  partnership  having a resident partner or
having any income derived from New York sources, and a corporation  with
respect  to which the taxable year of such change, correction, disallow-
ance or amendment is a year with respect to which the election  provided
for in subsection (a) of section six hundred sixty of this article is in
effect,  and (ii) the term "federal income tax return" shall include the
returns of income required under sections six  thousand  thirty-one  and
six  thousand  thirty-seven of the internal revenue code. In the case of
such a corporation,  such  report  shall  also  include  any  change  or
correction  of  the  taxes  described  in  paragraphs  two  and three of
subsection (f) of section thirteen hundred  sixty-six  of  the  internal
revenue code. Reports made under this section by a partnership or corpo-
ration  shall indicate the portion of the change in each item of income,
gain, loss or deduction (and, in the case  of  a  corporation,  of  each
change  in,  or  disallowance  of a claim for credit or refund of, a tax
referred to in the preceding sentence)  allocable  to  each  partner  or
shareholder  and  shall  set  forth  such  identifying  information with
respect to such partner or shareholder  as  may  be  prescribed  by  the
commissioner.
  S  2.  Subsection  (a)  of  section 1087 of the tax law, as amended by
section 9 of part H of chapter 1 of the laws of 2003, is amended to read
as follows:
  (a) General.--Claim for credit or refund  of  an  overpayment  of  tax
under  article  nine or nine-A shall be filed by the taxpayer within (i)
three years from the time the return was filed, (ii) two years from  the
time  the  tax  was paid or (iii) in the case of any overpayment arising
from an erroneous denial by the department of environmental conservation
of a certification of completion pursuant  to  section  27-1419  of  the
environmental conservation law, two years from the time a final determi-
nation  to  the  effect that such denial was erroneous is made and is no
longer subject to judicial review, whichever of such periods expires the
latest, or if no return was filed, within two years from  the  time  the
tax  was  paid.  If the claim is filed within the three year period, the
amount of the credit or refund shall not exceed the portion of  the  tax
paid  within  the  three  years  immediately preceding the filing of the
claim plus the period of any extension of time for filing the return. If
the claim is not filed within the three year period, but is filed within
the two year period, the amount of the credit or refund shall not exceed
the portion of the tax paid during the two years  immediately  preceding
the  filing  of  the  claim. In the case of a claim for credit or refund
filed  within  the  period  prescribed  in  paragraph  (iii)   of   this
subsection, the amount of the credit or refund may exceed the portion of
the  tax  paid  within  the applicable period specified in the two imme-
diately preceding sentences, but only to the extent of the amount of the
overpayment attributable to  the  denial  described  in  such  paragraph
(iii).  Except  as  otherwise  provided  in this section, if no claim is
filed, the amount of a credit or refund  shall  not  exceed  the  amount

S. 1818                             3

which would be allowable if a claim had been filed on the date the cred-
it  or  refund  is allowed. For special restriction in a proceeding on a
claim for refund of tax paid pursuant to an assessment made as a  result
of  (i)  [a  net  operating loss carryback or capital loss carryback, or
(ii)] an increase or decrease in federal taxable income or federal  tax,
or  [(iii)]  (II)  a  federal  change or correction or renegotiation, or
computation or recomputation of tax, which is treated in the same manner
as if it were a deficiency for federal income tax  purposes,  see  para-
graph  [(7)]  SEVEN  of  subsection  (c) of section one thousand eighty-
three.
  S 3. Subsection (b) of section 1089 of the  tax  law,  as  amended  by
chapter 55 of the laws of 1982, is amended to read as follows:
  (b)  Petition  for  redetermination  of  a deficiency.---Within ninety
days, or one hundred fifty days if the notice is addressed to a taxpayer
whose last known address is outside of  the  United  States,  after  the
mailing  of  the notice of deficiency authorized by section one thousand
eighty-one, the taxpayer may file a petition with the tax commission for
a redetermination of the deficiency. Such petition  may  also  assert  a
claim  for  refund  for  the  same taxable year or years, subject to the
limitations of subsection (g) of section one thousand eighty-seven.  For
special restriction where the notice of deficiency relates to a proposed
assessment  made  as  a result of (i) [a net operating loss carryback or
capital loss carryback, (ii)] an increase or decrease in federal taxable
income or federal tax, or [(iii)] (II) a federal change or correction or
renegotiation, or computation or recomputation of tax, which is  treated
in  the  same  manner  as if it were a deficiency for federal income tax
purposes, see paragraph [(7)] SEVEN of subsection  (c)  of  section  one
thousand eighty-three.
  S 4.  Subparagraph 3 of paragraph (a) and paragraph (d) of subdivision
8-b and paragraph (f) and subparagraph 3 of paragraph (g) of subdivision
9 of section 208 of the tax law are REPEALED.
  S  4-a.  Paragraph (e) of subdivision 13 of section 210 of the tax law
is REPEALED.
  S 5. Subdivision 3 of section 211 of the tax law is REPEALED.
  S 6. Subdivision (e) of section 213-b of the tax law is REPEALED.
  S 7. Paragraph 3 of subdivision (a) of section 292 of the tax  law  is
REPEALED.
  S  8.  Paragraph  4 of subsection (b) of section 631 of the tax law is
REPEALED.
  S 9. Subsection (b) of section 633 of the tax law is REPEALED.
  S 10. Paragraph 4 of subsection (c) of section 683 of the tax  law  is
REPEALED.
  S 11. Subsection (e) of section 684 of the tax law is REPEALED.
  S 12. Subsection (d) of section 687 of the tax law is REPEALED.
  S  13. Paragraph 4 of subsection (c) of section 1083 of the tax law is
REPEALED.
  S 14. Subsection (e) of section 1084 of the tax law is REPEALED.
  S 15. Subsection (d) of section 1088 of the tax law is REPEALED.
  S 16. Subsection (k-1) of section 1453 of the tax law is REPEALED.
  S 17. Paragraph 4 of subdivision (b) of section 1503 of the tax law is
REPEALED.
  S 18. Paragraph 1 of subdivision (e) of section 1515 of the tax law is
REPEALED.
  S 19. This act shall take effect on  the  one  hundred  eightieth  day
after it shall have become a law.