S T A T E O F N E W Y O R K
________________________________________________________________________
2120--A
2017-2018 Regular Sessions
I N S E N A T E
January 12, 2017
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Introduced by Sens. O'MARA, BONACIC, BOYLE, FUNKE, GALLIVAN, LARKIN,
MARCHIONE, ORTT, YOUNG -- read twice and ordered printed, and when
printed to be committed to the Committee on Investigations and Govern-
ment 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 committee
AN ACT to amend the tax law and the administrative code of the city of
New York, in relation to business income base and certain small busi-
ness taxpayers
THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:
Section 1. Subparagraph (iv) of paragraph (a) of subdivision 1 of
section 210 of the tax law, as amended by section 12 of part A of chap-
ter 59 of the laws of 2014, is amended to read as follows:
(iv) (A) for taxable years beginning before January first, two thou-
sand sixteen, if the business income base is not more than two hundred
ninety thousand dollars the amount shall be six and one-half percent of
the business income base; if the business income base is more than two
hundred ninety thousand dollars but not over three hundred ninety thou-
sand dollars the amount shall be the sum of (1) eighteen thousand eight
hundred fifty dollars, (2) seven and one-tenth percent of the excess of
the business income base over two hundred ninety thousand dollars but
not over three hundred ninety thousand dollars and (3) four and thirty-
five hundredths percent of the excess of the business income base over
three hundred fifty thousand dollars but not over three hundred ninety
thousand dollars;
(B) FOR TAXABLE YEARS BEGINNING ON OR AFTER JANUARY FIRST, TWO THOU-
SAND NINETEEN, IF THE BUSINESS INCOME BASE IS NOT MORE THAN FOUR HUNDRED
THOUSAND DOLLARS THE AMOUNT SHALL BE FOUR PERCENT OF THE BUSINESS INCOME
BASE; IF THE BUSINESS INCOME BASE IS MORE THAN FOUR HUNDRED THOUSAND
EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD07109-02-8
S. 2120--A 2
DOLLARS BUT NOT OVER FIVE HUNDRED THOUSAND DOLLARS THE AMOUNT SHALL BE
THE SUM OF (1) SIXTEEN THOUSAND DOLLARS, (2) SIX AND ONE-HALF PERCENT OF
THE EXCESS OF THE BUSINESS INCOME BASE OVER FOUR HUNDRED THOUSAND
DOLLARS BUT NOT OVER FIVE HUNDRED THOUSAND DOLLARS AND (3) TWENTY
PERCENT OF THE EXCESS OF THE BUSINESS INCOME BASE OVER FOUR HUNDRED
FIFTY THOUSAND DOLLARS BUT NOT OVER FIVE HUNDRED THOUSAND DOLLARS;
(C) FOR TAXABLE YEARS BEGINNING ON OR AFTER JANUARY FIRST, TWO THOU-
SAND TWENTY, IF THE BUSINESS INCOME BASE IS NOT MORE THAN FOUR HUNDRED
THOUSAND DOLLARS THE AMOUNT SHALL BE TWO AND ONE-HALF PERCENT OF THE
BUSINESS INCOME BASE; IF THE BUSINESS INCOME BASE IS MORE THAN FOUR
HUNDRED THOUSAND DOLLARS BUT NOT OVER FIVE HUNDRED THOUSAND DOLLARS THE
AMOUNT SHALL BE THE SUM OF (1) TEN THOUSAND DOLLARS, (2) SIX AND ONE-
HALF PERCENT OF THE EXCESS OF THE BUSINESS INCOME BASE OVER FOUR HUNDRED
THOUSAND DOLLARS BUT NOT OVER FIVE HUNDRED THOUSAND DOLLARS AND (3)
THIRTY-TWO PERCENT OF THE EXCESS OF THE BUSINESS INCOME BASE OVER FOUR
HUNDRED FIFTY THOUSAND DOLLARS BUT NOT OVER FIVE HUNDRED THOUSAND
DOLLARS.
§ 2. Paragraph 39 of subsection (c) of section 612 of the tax law, as
added by section 1 of part Y of chapter 59 of the laws of 2013, is
amended to read as follows:
(39) (A) In the case of a taxpayer who is a small business OR A
TAXPAYER WHO IS A MEMBER, PARTNER, OR SHAREHOLDER OF A LIMITED LIABILITY
COMPANY, PARTNERSHIP, OR NEW YORK S CORPORATION, RESPECTIVELY, THAT IS A
SMALL BUSINESS, who OR WHICH has business income [and/or farm income] as
defined in the laws of the United States, an amount equal to [three]
FIVE percent of the net items of income, gain, loss and deduction
attributable to such business [or farm] entering into federal adjusted
gross income, but not less than zero, for taxable years beginning after
two thousand [thirteen] EIGHTEEN, an amount equal to [three and three-
quarters] TEN percent of the net items of income, gain, loss and
deduction attributable to such business [or farm] entering into federal
adjusted gross income, but not less than zero, for taxable years begin-
ning after two thousand [fourteen] NINETEEN, and an amount equal to
[five] FIFTEEN percent of the net items of income, gain, loss and
deduction attributable to such business [or farm] entering into federal
adjusted gross income, but not less than zero[, for taxable years begin-
ning after two thousand fifteen].
(B) IN THE CASE OF A TAXPAYER WHO IS A FARM BUSINESS OR A TAXPAYER WHO
IS A MEMBER, PARTNER, OR SHAREHOLDER OF A LIMITED LIABILITY COMPANY,
PARTNERSHIP, OR NEW YORK S CORPORATION, RESPECTIVELY, THAT IS A FARM
BUSINESS, WHO OR WHICH HAS FARM INCOME AS DEFINED BY THE LAWS OF THE
UNITED STATES, AN AMOUNT EQUAL TO TWENTY PERCENT OF THE NET ITEMS OF
INCOME, GAIN, LOSS AND DEDUCTION ATTRIBUTABLE TO SUCH FARM. THE TERM
FARM BUSINESS SHALL MEAN A FARM BUSINESS THAT HAS NET FARM INCOME OF
LESS THAN FIVE HUNDRED THOUSAND DOLLARS.
(C) (I) For the purposes of this paragraph, the term small business
shall mean: (I) a sole proprietor [or a farm business who employs one or
more persons during the taxable year and] who has net business income
[or net farm income] of less than [two hundred fifty] FIVE HUNDRED thou-
sand dollars; OR (II) A LIMITED LIABILITY COMPANY, PARTNERSHIP OR NEW
YORK S CORPORATION THAT DURING THE TAXABLE YEAR HAS NEW YORK GROSS BUSI-
NESS INCOME ATTRIBUTABLE TO A NON-FARM BUSINESS THAT IS GREATER THAN
ZERO BUT LESS THAN ONE MILLION FIVE HUNDRED THOUSAND DOLLARS OR NET FARM
INCOME ATTRIBUTABLE TO A FARM BUSINESS THAT IS GREATER THAN ZERO BUT
LESS THAN FIVE HUNDRED THOUSAND DOLLARS. (II) FOR PURPOSES OF THIS PARA-
GRAPH, THE TERM NEW YORK GROSS BUSINESS INCOME SHALL MEAN: (I) IN THE
S. 2120--A 3
CASE OF A LIMITED LIABILITY COMPANY OR A PARTNERSHIP, NEW YORK SOURCE
GROSS INCOME AS DEFINED IN SUBPARAGRAPH (B) OF PARAGRAPH THREE OF
SUBSECTION (C) OF SECTION SIX HUNDRED FIFTY-EIGHT OF THIS ARTICLE, AND,
(II) IN THE CASE OF A NEW YORK S CORPORATION, NEW YORK RECEIPTS INCLUDED
IN THE NUMERATOR OF THE APPORTIONMENT FACTOR DETERMINED UNDER SECTION
TWO HUNDRED TEN-A OF THIS CHAPTER FOR THE TAXABLE YEAR.
(D) TO QUALIFY FOR THIS MODIFICATION IN RELATION TO A NON-FARM SMALL
BUSINESS THAT IS A LIMITED LIABILITY COMPANY, PARTNERSHIP OR NEW YORK S
CORPORATION, THE TAXPAYER'S INCOME ATTRIBUTABLE TO THE NET BUSINESS
INCOME FROM ITS OWNERSHIP INTERESTS IN NON-FARM LIMITED LIABILITY COMPA-
NIES, PARTNERSHIPS OR NEW YORK S CORPORATIONS MUST BE LESS THAN FIVE
HUNDRED THOUSAND DOLLARS.
§ 3. Paragraph 35 of subdivision (c) of section 11-1712 of the admin-
istrative code of the city of New York, as added by section 2 of part Y
of chapter 59 of the laws of 2013, is amended to read as follows:
(35) (A) In the case of a taxpayer who is a small business OR A
TAXPAYER WHO IS A MEMBER, PARTNER, OR SHAREHOLDER OF A LIMITED LIABILITY
COMPANY, PARTNERSHIP, OR NEW YORK S CORPORATION, RESPECTIVELY, THAT IS A
SMALL BUSINESS, who OR WHICH has business income [and/or farm income] as
defined in the laws of the United States, an amount equal to [three]
FIFTEEN percent of the net items of income, gain, loss and deduction
attributable to such business [or farm] entering into federal adjusted
gross income, but not less than zero[, for taxable years beginning after
two thousand thirteen, an amount equal to three and three-quarters
percent of the net items of income, gain, loss and deduction attribut-
able to such business or farm entering into federal adjusted gross
income, but not less than zero, for taxable years beginning after two
thousand fourteen, and an amount equal to five percent of the net items
of income, gain, loss and deduction attributable to such business or
farm entering into federal adjusted gross income, but not less than
zero, for taxable years beginning after two thousand fifteen].
(B) IN THE CASE OF A TAXPAYER WHO IS A FARM BUSINESS OR A TAXPAYER WHO
IS A MEMBER, PARTNER, OR SHAREHOLDER OF A LIMITED LIABILITY COMPANY,
PARTNERSHIP, OR NEW YORK S CORPORATION, RESPECTIVELY, THAT IS A FARM
BUSINESS, WHO OR WHICH HAS FARM INCOME AS DEFINED BY THE LAWS OF THE
UNITED STATES, AN AMOUNT EQUAL TO TWENTY PERCENT OF THE NET ITEMS OF
INCOME, GAIN, LOSS AND DEDUCTION ATTRIBUTABLE TO SUCH FARM. THE TERM
FARM BUSINESS SHALL MEAN A FARM BUSINESS THAT HAS NET FARM INCOME OF
LESS THAN FIVE HUNDRED THOUSAND DOLLARS.
(C) (I) For the purposes of this paragraph, the term small business
shall mean: (I) a sole proprietor [or a farm business who employs one or
more persons during the taxable year and] who has net business income
[or net farm income] of less than [two hundred fifty] FIVE HUNDRED thou-
sand dollars; OR (II) A LIMITED LIABILITY COMPANY, PARTNERSHIP OR NEW
YORK S CORPORATION THAT DURING THE TAXABLE YEAR HAS NEW YORK GROSS BUSI-
NESS INCOME ATTRIBUTABLE TO A NON-FARM BUSINESS THAT IS GREATER THAN
ZERO BUT LESS THAN ONE MILLION FIVE HUNDRED THOUSAND DOLLARS OR NET FARM
INCOME ATTRIBUTABLE TO A FARM BUSINESS THAT IS GREATER THAN ZERO BUT
LESS THAN FIVE HUNDRED THOUSAND DOLLARS. (II) FOR PURPOSES OF THIS PARA-
GRAPH, THE TERM NEW YORK GROSS BUSINESS INCOME SHALL MEAN: (I) IN THE
CASE OF A LIMITED LIABILITY COMPANY OR A PARTNERSHIP, NEW YORK SOURCE
GROSS INCOME AS DEFINED IN SUBPARAGRAPH (B) OF PARAGRAPH THREE OF
SUBSECTION (C) OF SECTION SIX HUNDRED FIFTY-EIGHT OF THE TAX LAW, AND,
(II) IN THE CASE OF A NEW YORK S CORPORATION, NEW YORK RECEIPTS INCLUDED
IN THE NUMERATOR OF THE APPORTIONMENT FACTOR DETERMINED UNDER SECTION
TWO HUNDRED TEN-A OF THE TAX LAW FOR THE TAXABLE YEAR.
S. 2120--A 4
(D) TO QUALIFY FOR THIS MODIFICATION IN RELATION TO A NON-FARM SMALL
BUSINESS THAT IS A LIMITED LIABILITY COMPANY, PARTNERSHIP OR NEW YORK S
CORPORATION, THE TAXPAYER'S INCOME ATTRIBUTABLE TO THE NET BUSINESS
INCOME FROM ITS OWNERSHIP INTERESTS IN NON-FARM LIMITED LIABILITY COMPA-
NIES, PARTNERSHIPS OR NEW YORK S CORPORATIONS MUST BE LESS THAN FIVE
HUNDRED THOUSAND DOLLARS.
§ 4. This act shall take effect immediately and shall apply to taxable
years beginning on or after January 1, 2019.
