NY State Senate Bill 2019-S1144

Senate Bill S1144

2019-2020 Legislative Session

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

download bill text pdf

Archive: Last Bill Status - In Senate Committee Investigations And Government Operations 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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	Assembly Actions - Lowercase Senate Actions - UPPERCASE
Jan 08, 2020	referred to investigations and government operations
Jan 11, 2019	referred to investigations and government operations

2019-S1144 (ACTIVE) - Details

Current Committee:: Senate Investigations And Government Operations
Law Section:: Tax Law
Laws Affected:: Add §§44 & 187-t, amd §§210-B, 606 & 1511, Tax L
Versions Introduced in Other Legislative Sessions:: 2013-2014: S6737
2015-2016: S2703
2017-2018: S1406

2019-S1144 (ACTIVE) - Summary

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

2019-S1144 (ACTIVE) - Sponsor Memo

                                
 
BILL NUMBER: S1144

SPONSOR: CARLUCCI
 
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 inventive 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, or thirty-
three of the tax law a credit against such taxes in tax year 2016. 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 sections 187-t of the tax law to establish the
credit explained above in article nine of the tax law.

Section 3 amends section 210-b of the tax law by adding a new subdivi-
sion 49 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.

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

Section 6 amends section 1511 of the tax law by adding a new subdivision
(dd) to establish the credit explained above.

Section 7 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 choos-
ing 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:

2017-18: S1406 - INVESTIGATIONS & GOV'T OPS

2015-16: S2703A - Investigations and Government Operations S.6737 of
2014

 
FISCAL IMPLICATIONS:

The credit amount to be offered is capped at $5 million. Since the bene-
fit allows employees to deduct income set aside for qualified expenses
from taxes, there would be an additional associated costs 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.

 
LEGISLATIVE DATE:

This act shall take effect immediately.

2019-S1144 (ACTIVE) - Bill Text download pdf

                            
 
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   1144
 
                        2019-2020 Regular Sessions
 
                             I N  S E N A T E
 
                             January 11, 2019
                                ___________
 
 Introduced  by Sen. CARLUCCI -- 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 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 44  to  read
 as follows:
   §  44.  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 NINETEEN, A TAXPAYER SUBJECT
 TO TAX UNDER ARTICLE NINE, NINE-A, TWENTY-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 FEDER-
 AL 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.
                                                            LBD06314-01-9

 S. 1144                             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-B, SUBDIVISION 53,
   (3) ARTICLE 22: SECTION 606, SUBSECTIONS (I) AND (JJJ),
   (4) 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-
 THREE OF SECTION TWO HUNDRED TEN-B, CLAUSE (XLIV) OF SUBPARAGRAPH (B) OF
 PARAGRAPH ONE OF SUBSECTION (I) AND  SUBSECTION  (JJJ)  OF  SECTION  SIX
 HUNDRED  SIX  AND  SUBDIVISION (DD) OF SECTION FIFTEEN HUNDRED ELEVEN OF
 THIS CHAPTER SHALL NOT EXCEED FIVE MILLION DOLLARS.
   § 2. The tax law is amended by adding a new section 187-t to  read  as
 follows:
   §  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-FOUR OF
 THIS CHAPTER, AGAINST THE TAXES IMPOSED BY SECTIONS ONE HUNDRED  EIGHTY-
 THREE  AND  ONE HUNDRED EIGHTY-FOUR OF THIS ARTICLE.  PROVIDED, HOWEVER,
 THAT THE AMOUNT OF SUCH CREDIT ALLOWABLE  AGAINST  THE  TAX  IMPOSED  BY
 SECTION  ONE  HUNDRED EIGHTY-FOUR OF THIS ARTICLE 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 OF THIS ARTICLE.
   § 3. Section 210-B of the tax law is amended by adding a new  subdivi-
 sion 53 to read as follows:
   53.  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-FOUR OF THIS CHAP-
 TER, 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.
   § 4. Subparagraph (B) of paragraph 1 of subsection (i) of section  606
 of  the  tax  law  is  amended  by adding a new clause (xliv) to read as
 follows:
 (XLIV) CREDIT FOR PROVISION OF       AMOUNT OF CREDIT UNDER SUBDIVISION
 EMPLOYEE FEDERAL QUALIFIED           FIFTY-THREE OF SECTION TWO HUNDRED
 TRANSPORTATION FRINGE BENEFITS       TEN-B, OR SUBDIVISION (DD) OF
 UNDER SUBSECTION (JJJ)               SECTION FIFTEEN HUNDRED ELEVEN
   § 5. Section 606 of the tax law is amended by adding a new  subsection
 (jjj) to read as follows:
   (JJJ)  CREDIT  FOR PROVISION OF EMPLOYEE FEDERAL QUALIFIED TRANSPORTA-
 TION FRINGE BENEFITS. ALLOWANCE OF CREDIT. A TAXPAYER SHALL BE ALLOWED A
 CREDIT, TO BE COMPUTED AS PROVIDED IN SECTION FORTY-FOUR OF  THIS  CHAP-
 TER, AGAINST THE TAX IMPOSED BY THIS ARTICLE.
   §  6.  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

 S. 1144                             3
 
 CREDIT,  TO  BE COMPUTED AS PROVIDED IN SECTION FORTY-FOUR OF THIS CHAP-
 TER, 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.
   § 7. This act shall take effect immediately.

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