S T A T E O F N E W Y O R K
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6259
2019-2020 Regular Sessions
I N S E N A T E
May 30, 2019
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Introduced by Sens. BENJAMIN, JACOBS -- read twice and ordered printed,
and when printed to be committed to the Committee on Budget and Reven-
ue
AN ACT to amend the tax law, in relation to advance payment of the
earned income credit
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 679 to read
as follows:
§ 679. ADVANCE PAYMENT OF EARNED INCOME CREDIT. (A) GENERAL RULE.
EXCEPT AS OTHERWISE PROVIDED IN THIS CHAPTER, EVERY EMPLOYER MAKING
PAYMENT OF WAGES TO AN EMPLOYEE WITH RESPECT TO WHOM AN EARNED INCOME
ELIGIBILITY CERTIFICATE IS IN EFFECT SHALL, AT THE TIME OF PAYING SUCH
WAGES, MAKE AN ADDITIONAL PAYMENT TO SUCH EMPLOYEE EQUAL TO SUCH EMPLOY-
EE'S EARNED INCOME ADVANCE AMOUNT.
(B) EARNED INCOME ELIGIBILITY CERTIFICATE. FOR PURPOSES OF THIS ARTI-
CLE, AN EARNED INCOME ELIGIBILITY CERTIFICATE IS A STATEMENT FURNISHED
BY AN EMPLOYEE TO THE EMPLOYER WHICH:
(1) CERTIFIES THAT THE EMPLOYEE WILL BE ELIGIBLE TO RECEIVE AN EARNED
INCOME CREDIT OR AN ENHANCED EARNED INCOME CREDIT PROVIDED BY SUBSECTION
(D) OR (D-1) OF SECTION SIX HUNDRED SIX OF THIS ARTICLE FOR THE TAXABLE
YEAR,
(2) CERTIFIES THAT THE EMPLOYEE HAS ONE OR MORE QUALIFYING CHILDREN
FOR SUCH TAXABLE YEAR,
(3) CERTIFIES THAT THE EMPLOYEE DOES NOT HAVE AN EARNED INCOME ELIGI-
BILITY CERTIFICATE IN EFFECT FOR THE CALENDAR YEAR WITH RESPECT TO THE
PAYMENT OF WAGES BY ANOTHER EMPLOYER, AND
(4) STATES WHETHER OR NOT THE EMPLOYEE'S SPOUSE HAS AN EARNED INCOME
ELIGIBILITY CERTIFICATE IN EFFECT.
FOR PURPOSES OF THIS SECTION, A CERTIFICATE SHALL BE TREATED AS BEING
IN EFFECT WITH RESPECT TO A SPOUSE IF SUCH A CERTIFICATE WILL BE IN
EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD13069-01-9
S. 6259 2
EFFECT ON THE FIRST STATUS DETERMINATION DATE FOLLOWING THE DATE ON
WHICH THE EMPLOYEE FURNISHES THE STATEMENT IN QUESTION.
(C) EARNED INCOME ADVANCE AMOUNT. (1) IN GENERAL, FOR PURPOSES OF THIS
SECTION, THE TERM "EARNED INCOME ADVANCE AMOUNT" MEANS, WITH RESPECT TO
ANY PAYROLL PERIOD, THE AMOUNT DETERMINED:
(A) ON THE BASIS OF THE EMPLOYEE'S WAGES FROM THE EMPLOYER FOR SUCH
PERIOD, AND
(B) IN ACCORDANCE WITH TABLES PRESCRIBED BY THE COMMISSIONER.
IN THE CASE OF AN EMPLOYEE WHO IS A MEMBER OF THE ARMED FORCES OF THE
UNITED STATES, THE EARNED INCOME ADVANCE AMOUNT SHALL BE DETERMINED BY
TAKING INTO ACCOUNT SUCH EMPLOYEE'S EARNED INCOME AS DETERMINED FOR
PURPOSES OF SUBSECTION (D) OF SECTION SIX HUNDRED SIX OF THIS ARTICLE.
(2) ADVANCE AMOUNT TABLES. THE TABLES REFERRED TO IN SUBPARAGRAPH (B)
OF PARAGRAPH ONE OF THIS SUBSECTION:
(A) SHALL BE SIMILAR IN FORM TO THE TABLES PRESCRIBED UNDER SECTION
3402 OF THE INTERNAL REVENUE CODE AND, TO THE MAXIMUM EXTENT FEASIBLE,
SHALL BE COORDINATED WITH SUCH TABLES, AND
(B) IF THE EMPLOYEE IS NOT MARRIED, OR IF NO EARNED INCOME ELIGIBILITY
CERTIFICATE IS IN EFFECT WITH RESPECT TO THE SPOUSE OF THE EMPLOYEE,
SHALL TREAT THE CREDIT PROVIDED BY SUBSECTION (D) OR (D-1) OF SECTION
SIX HUNDRED SIX OF THIS ARTICLE AS IF IT WERE A CREDIT:
(I) OF NOT MORE THAN SIXTY PERCENT OF THE CREDIT PERCENTAGE IN EFFECT
UNDER SECTION 32(B)(1) OF THE INTERNAL REVENUE CODE FOR AN ELIGIBLE
INDIVIDUAL WITH ONE QUALIFYING CHILD AND WITH EARNED INCOME NOT IN
EXCESS OF THE EARNED INCOME AMOUNT IN EFFECT UNDER SECTION 32(B)(2) OF
THE INTERNAL REVENUE CODE FOR SUCH AN ELIGIBLE INDIVIDUAL, WHICH
(II) PHASES OUT AT SIXTY PERCENT OF THE PHASEOUT PERCENTAGE IN EFFECT
UNDER SECTION 32(B)(1) OF THE INTERNAL REVENUE CODE FOR SUCH AN ELIGIBLE
INDIVIDUAL BETWEEN THE PHASEOUT AMOUNT IN EFFECT UNDER SECTION 32(B)(2)
OF THE INTERNAL REVENUE CODE FOR SUCH AN ELIGIBLE INDIVIDUAL AND THE
AMOUNT OF EARNED INCOME AT WHICH THE CREDIT UNDER SECTION 32(A) OF THE
INTERNAL REVENUE CODE PHASES OUT FOR SUCH AN ELIGIBLE INDIVIDUAL, OR
(C) IF AN EARNED INCOME ELIGIBILITY CERTIFICATE IS IN EFFECT WITH
RESPECT TO THE SPOUSE OF THE EMPLOYEE, SHALL TREAT THE CREDIT AS IF IT
WERE A CREDIT DETERMINED UNDER SUBPARAGRAPH (B) OF THIS PARAGRAPH BY
SUBSTITUTING ONE-HALF OF THE AMOUNTS OF EARNED INCOME DESCRIBED IN SUCH
SUBPARAGRAPH FOR SUCH AMOUNTS.
(D) PAYMENTS TO BE TREATED AS PAYMENTS OF WITHHOLDING. (1) IN GENER-
AL, FOR PURPOSES OF THIS ARTICLE, PAYMENTS MADE BY AN EMPLOYER UNDER
SUBSECTION (A) OF THIS SECTION TO HIS OR HER EMPLOYEES FOR ANY PAYROLL
PERIOD:
(A) SHALL NOT BE TREATED AS THE PAYMENT OF COMPENSATION, AND
(B) SHALL BE TREATED AS MADE OUT OF AMOUNTS REQUIRED TO BE DEDUCTED
AND WITHHELD FOR THE PAYROLL PERIOD UNDER PART FIVE OF THIS ARTICLE, AS
IF THE EMPLOYER HAD PAID TO THE COMMISSIONER, ON THE DAY ON WHICH THE
WAGES ARE PAID TO THE EMPLOYEES, AN AMOUNT EQUAL TO SUCH PAYMENTS.
(2) ADVANCE PAYMENTS EXCEED TAXES DUE. IN THE CASE OF ANY EMPLOYER, IF
FOR ANY PAYROLL PERIOD THE AGGREGATE AMOUNT OF EARNED INCOME ADVANCE
PAYMENTS EXCEEDS THE SUM OF THE AMOUNTS REFERRED TO IN SUBPARAGRAPH (B)
OF PARAGRAPH ONE OF THIS SUBSECTION, EACH SUCH ADVANCE PAYMENT SHALL BE
REDUCED BY AN AMOUNT WHICH BEARS THE SAME RATIO TO SUCH EXCESS AS SUCH
ADVANCE PAYMENT BEARS TO THE AGGREGATE AMOUNT OF ALL SUCH ADVANCE
PAYMENTS.
(3) EMPLOYER MAY MAKE FULL ADVANCE PAYMENTS. THE COMMISSIONER SHALL
PRESCRIBE REGULATIONS UNDER WHICH AN EMPLOYER MAY ELECT (IN LIEU OF ANY
APPLICATION OF PARAGRAPH TWO OF THIS SUBSECTION):
S. 6259 3
(A) TO PAY IN FULL ALL EARNED INCOME ADVANCE AMOUNTS, AND
(B) TO HAVE ADDITIONAL AMOUNTS PAID BY REASON OF THIS PARAGRAPH TREAT-
ED AS THE ADVANCE PAYMENT OF TAXES IMPOSED BY THIS TITLE.
(4) FAILURE TO MAKE ADVANCE PAYMENTS. FOR PURPOSES OF THIS ARTICLE
(INCLUDING PENALTIES), FAILURE TO MAKE ANY ADVANCE PAYMENT UNDER THIS
SECTION AT THE TIME PROVIDED THEREFOR SHALL BE TREATED AS THE FAILURE AT
SUCH TIME TO DEDUCT AND WITHHOLD UNDER THIS ARTICLE AN AMOUNT EQUAL TO
THE AMOUNT OF SUCH ADVANCE PAYMENT.
(E) FURNISHING AND TAKING EFFECT OF CERTIFICATES. FOR PURPOSES OF THIS
SECTION:
(1) WHEN CERTIFICATE TAKES EFFECT.
(A) FIRST CERTIFICATE FURNISHED. AN EARNED INCOME ELIGIBILITY CERTIF-
ICATE FURNISHED THE EMPLOYER IN CASES IN WHICH NO PREVIOUS SUCH CERTIF-
ICATE HAD BEEN IN EFFECT FOR THE CALENDAR YEAR SHALL TAKE EFFECT AS OF
THE BEGINNING OF THE FIRST PAYROLL PERIOD ENDING, OR THE FIRST PAYMENT
OF WAGES MADE WITHOUT REGARD TO A PAYROLL PERIOD, ON OR AFTER THE DATE
ON WHICH SUCH CERTIFICATE IS SO FURNISHED (OR IF LATER, THE FIRST DAY OF
THE CALENDAR YEAR FOR WHICH FURNISHED).
(B) LATER CERTIFICATE. AN EARNED INCOME ELIGIBILITY CERTIFICATE
FURNISHED THE EMPLOYER IN CASES IN WHICH A PREVIOUS SUCH CERTIFICATE HAD
BEEN IN EFFECT FOR THE CALENDAR YEAR SHALL TAKE EFFECT WITH RESPECT TO
THE FIRST PAYMENT OF WAGES MADE ON OR AFTER THE FIRST STATUS DETERMI-
NATION DATE WHICH OCCURS AT LEAST THIRTY DAYS AFTER THE DATE ON WHICH
SUCH CERTIFICATE IS SO FURNISHED, EXCEPT THAT AT THE ELECTION OF THE
EMPLOYER SUCH CERTIFICATE MAY BE MADE EFFECTIVE WITH RESPECT TO ANY
PAYMENT OF WAGES MADE ON OR AFTER THE DATE ON WHICH SUCH CERTIFICATE IS
SO FURNISHED. FOR PURPOSES OF THIS SECTION, THE TERM "STATUS DETERMI-
NATION DATE" MEANS JANUARY FIRST, MAY FIRST, JULY FIRST, AND OCTOBER
FIRST OF EACH YEAR.
(2) PERIOD DURING WHICH CERTIFICATE REMAINS IN EFFECT. AN EARNED
INCOME ELIGIBILITY CERTIFICATE WHICH TAKES EFFECT UNDER THIS SECTION FOR
ANY CALENDAR YEAR SHALL CONTINUE IN EFFECT WITH RESPECT TO THE EMPLOYEE
DURING SUCH CALENDAR YEAR UNTIL REVOKED BY THE EMPLOYEE OR UNTIL ANOTHER
SUCH CERTIFICATE TAKES EFFECT UNDER THIS SECTION.
(3) CHANGE OF STATUS.
(A) REQUIREMENT TO REVOKE OR FURNISH NEW CERTIFICATE. IF, AFTER AN
EMPLOYEE HAS FURNISHED AN EARNED INCOME ELIGIBILITY CERTIFICATE UNDER
THIS SECTION, THERE HAS BEEN A CHANGE OF CIRCUMSTANCES WHICH HAS THE
EFFECT OF:
(I) MAKING THE EMPLOYEE INELIGIBLE FOR THE CREDIT PROVIDED BY
SUBSECTION (D) OR (D-1) OF SECTION SIX HUNDRED SIX OF THIS ARTICLE FOR
THE TAXABLE YEAR, OR
(II) CAUSING AN EARNED INCOME ELIGIBILITY CERTIFICATE TO BE IN EFFECT
WITH RESPECT TO THE SPOUSE OF THE EMPLOYEE, THE EMPLOYEE SHALL, WITHIN
TEN DAYS AFTER SUCH CHANGE IN CIRCUMSTANCES, FURNISH THE EMPLOYER WITH A
REVOCATION OF SUCH CERTIFICATE OR WITH A NEW CERTIFICATE (AS THE CASE
MAY BE). SUCH A REVOCATION (OR SUCH A NEW CERTIFICATE) SHALL TAKE EFFECT
UNDER THE RULES PROVIDED BY SUBPARAGRAPH (B) OF PARAGRAPH ONE OF THIS
SUBSECTION FOR A LATER CERTIFICATE AND SHALL BE MADE IN SUCH FORM AS THE
COMMISSIONER SHALL BY REGULATIONS PRESCRIBE.
(B) CERTIFICATE NO LONGER IN EFFECT. IF, AFTER AN EMPLOYEE HAS
FURNISHED AN EARNED INCOME ELIGIBILITY CERTIFICATE UNDER THIS SECTION
WHICH CERTIFIES THAT SUCH A CERTIFICATE IS IN EFFECT WITH RESPECT TO THE
SPOUSE OF THE EMPLOYEE, SUCH A CERTIFICATE IS NO LONGER IN EFFECT WITH
RESPECT TO SUCH SPOUSE, THEN THE EMPLOYEE MAY FURNISH THE EMPLOYER WITH
A NEW EARNED INCOME ELIGIBILITY CERTIFICATE.
S. 6259 4
(4) FORM AND CONTENTS OF CERTIFICATE. EARNED INCOME ELIGIBILITY
CERTIFICATES SHALL BE IN SUCH FORM AND CONTAIN SUCH OTHER INFORMATION AS
THE COMMISSIONER MAY BY REGULATIONS PRESCRIBE.
(5) TAXABLE YEAR DEFINED. THE TERM "TAXABLE YEAR" MEANS THE LAST TAXA-
BLE YEAR OF THE EMPLOYEE BEGINNING IN THE CALENDAR YEAR IN WHICH THE
WAGES ARE PAID.
(F) NOTIFICATION. THE COMMISSIONER SHALL TAKE SUCH STEPS AS MAY BE
APPROPRIATE TO ENSURE THAT TAXPAYERS WHO HAVE ONE OR MORE QUALIFYING
CHILDREN AND WHO RECEIVE A REFUND OF THE CREDIT UNDER SUBSECTION (D) OR
(D-1) OF SECTION SIX HUNDRED SIX OF THIS ARTICLE ARE AWARE OF THE AVAIL-
ABILITY OF EARNED INCOME ADVANCE AMOUNTS UNDER THIS SECTION.
(G) COORDINATION WITH ADVANCE PAYMENTS OF EARNED INCOME CREDIT.
(1) RECAPTURE OF EXCESS ADVANCE PAYMENTS. IF ANY PAYMENT IS MADE TO
THE INDIVIDUAL BY AN EMPLOYER UNDER THIS SECTION DURING ANY CALENDAR
YEAR, THEN THE TAX IMPOSED BY THIS CHAPTER FOR THE INDIVIDUAL'S LAST
TAXABLE YEAR BEGINNING IN SUCH CALENDAR YEAR SHALL BE INCREASED BY THE
AGGREGATE AMOUNT OF SUCH PAYMENTS.
(2) SAFE HARBOR AGAINST RECAPTURE OF EXCESS ADVANCE PAYMENTS. IF AN
INDIVIDUAL ESTABLISHES THAT THEY ARE REQUESTING AND RECEIVING PAYMENTS
UNDER THIS SECTION IN GOOD-FAITH BY ESTABLISHING THAT THEY PROPERLY
CLAIMED PAYMENTS UNDER THIS SECTION IN THE PRIOR YEAR AND THAT THEY HAVE
NOT EXPERIENCED A SUBSTANTIAL CHANGE IN CIRCUMSTANCES SUCH THAT THEY
HAVE A REASONABLE EXPECTATION OF ELIGIBILITY IN THE CURRENT YEAR, THEN
PARAGRAPH ONE OF THIS SUBSECTION SHALL NOT APPLY.
(3) RECONCILIATION OF PAYMENTS ADVANCED AND CREDIT ALLOWED. ANY
INCREASE IN TAX UNDER THIS SUBSECTION SHALL NOT BE TREATED AS TAX
IMPOSED BY THIS CHAPTER FOR PURPOSES OF DETERMINING THE AMOUNT OF ANY
CREDIT (OTHER THAN THE CREDIT ALLOWED BY SUBSECTION (D) OR (D-1) OF
SECTION SIX HUNDRED SIX OF THIS ARTICLE) ALLOWABLE UNDER THIS ARTICLE.
§ 2. This act shall take effect on the thirtieth day after it shall
have become a law and shall apply to taxable years beginning January 1,
2020.
