S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                  3982--A
 
                        2019-2020 Regular Sessions
 
                             I N  S E N A T E
 
                             February 22, 2019
                                ___________
 
 Introduced  by  Sens. KRUEGER, BAILEY, LIU, MONTGOMERY -- read twice and
   ordered printed, and when printed to be committed to the Committee  on
   Budget  and  Revenue  --  committee  discharged, bill amended, ordered
   reprinted as amended and recommitted to said committee
 
 AN ACT to amend the tax law, in relation to creating  the  middle  class
   circuit breaker tax credit and creating a tax reform study commission
 
   THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section 1. Section 606 of the tax law  is  amended  by  adding  a  new
 subsection (jjj) to read as follows:
   (JJJ)  MIDDLE  CLASS  CIRCUIT BREAKER CREDIT. (1) DEFINITIONS. FOR THE
 PURPOSES OF THIS SUBSECTION:
   (A) "QUALIFIED TAXPAYER" MEANS A RESIDENT INDIVIDUAL OF THE STATE  WHO
 OWNS  OR RENTS THE RESIDENTIAL REAL PROPERTY IN WHICH HE OR SHE RESIDES,
 AND HAS RESIDED IN SUCH RESIDENTIAL REAL PROPERTY FOR NOT LESS THAN FIVE
 YEARS.
   (B) "HOUSEHOLD" OR  "MEMBERS  OF  THE  HOUSEHOLD"  MEANS  A  QUALIFIED
 TAXPAYER  OR  QUALIFIED TAXPAYERS AND ALL OTHER PERSONS, NOT NECESSARILY
 RELATED, WHO ALL RESIDE IN THE RESIDENTIAL REAL PROPERTY  OWNED  BY  THE
 TAXPAYER  OR TAXPAYERS, AND SHARE ITS FURNISHINGS, FACILITIES AND ACCOM-
 MODATIONS; PROVIDED THAT NO PERSON MAY BE A  MEMBER  OF  MORE  THAN  ONE
 HOUSEHOLD AT ONE TIME.
   (C) "HOUSEHOLD GROSS INCOME" MEANS THE AGGREGATE ADJUSTED GROSS INCOME
 OF  ALL  MEMBERS  OF  THE HOUSEHOLD FOR THE TAXABLE YEAR AS REPORTED FOR
 FEDERAL INCOME TAX PURPOSES, OR WHICH  WOULD  BE  REPORTED  AS  ADJUSTED
 GROSS  INCOME  IF A FEDERAL INCOME TAX RETURN WERE REQUIRED TO BE FILED,
 WITH THE MODIFICATIONS IN SUBSECTION (B) OF SECTION SIX  HUNDRED  TWELVE
 OF  THIS ARTICLE BUT WITHOUT THE MODIFICATIONS IN SUBSECTION (C) OF SUCH
 SECTION, PLUS ANY PORTION OF THE GAIN FROM THE SALE OR EXCHANGE OF PROP-
 ERTY OTHERWISE EXCLUDED FROM SUCH AMOUNT;  EARNED  INCOME  FROM  SOURCES
 WITHOUT  THE  UNITED  STATES  EXCLUDABLE  FROM  FEDERAL  GROSS INCOME BY
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
              

                                                            LBD06765-04-9

 S. 3982--A                          2
 
 SECTION NINE HUNDRED ELEVEN OF THE INTERNAL REVENUE CODE; SUPPORT  MONEY
 NOT  INCLUDED  IN  ADJUSTED  GROSS  INCOME;  NONTAXABLE STRIKE BENEFITS;
 SUPPLEMENTAL SECURITY INCOME PAYMENTS; THE GROSS AMOUNT OF  ANY  PENSION
 OR  ANNUITY  BENEFITS  TO THE EXTENT NOT INCLUDED IN SUCH ADJUSTED GROSS
 INCOME (INCLUDING, BUT NOT LIMITED TO, RAILROAD RETIREMENT BENEFITS  AND
 ALL  PAYMENTS  RECEIVED UNDER THE FEDERAL SOCIAL SECURITY ACT AND VETER-
 ANS' DISABILITY PENSIONS); NONTAXABLE INTEREST RECEIVED FROM  THE  STATE
 OF  NEW  YORK,  ITS AGENCIES, INSTRUMENTALITIES, PUBLIC CORPORATIONS, OR
 POLITICAL SUBDIVISIONS (INCLUDING A PUBLIC CORPORATION CREATED  PURSUANT
 TO  AGREEMENT OR COMPACT WITH ANOTHER STATE OR CANADA); WORKERS' COMPEN-
 SATION; THE GROSS AMOUNT OF "LOSS-OF-TIME" INSURANCE; AND THE AMOUNT  OF
 CASH PUBLIC ASSISTANCE AND RELIEF, OTHER THAN MEDICAL ASSISTANCE FOR THE
 NEEDY,  PAID  TO OR FOR THE BENEFIT OF THE QUALIFIED TAXPAYER OR MEMBERS
 OF HIS OR HER HOUSEHOLD. HOUSEHOLD  GROSS  INCOME  SHALL    NOT  INCLUDE
 SURPLUS  FOODS  OR  OTHER RELIEF IN KIND OR PAYMENTS MADE TO INDIVIDUALS
 BECAUSE OF THEIR STATUS AS VICTIMS OF NAZI  PERSECUTION  AS  DEFINED  IN
 PUBLIC  LAW  103-286 OR ANY DISABILITY COMPENSATION RECEIVED BY VETERANS
 ON ACCOUNT OF INJURY OR ILLNESS INCURRED OR AGGRAVATED  DURING  MILITARY
 SERVICE  IN  THE  WARS IN AFGHANISTAN AND IRAQ SINCE SEPTEMBER ELEVENTH,
 TWO THOUSAND ONE.  PROVIDED, FURTHER, HOUSEHOLD GROSS INCOME SHALL  ONLY
 INCLUDE  ALL  SUCH INCOME RECEIVED BY ALL MEMBERS OF THE HOUSEHOLD WHILE
 MEMBERS OF SUCH HOUSEHOLD.
   (D) "ADJUSTED RENT" MEANS RENT PAID FOR THE RIGHT OF  OCCUPANCY  OF  A
 RESIDENCE.
   (E)  "REAL PROPERTY TAX EQUIVALENT" MEANS (1) FOR TAXABLE YEARS BEGIN-
 NING IN TWO THOUSAND TWENTY, FIFTEEN PERCENT OF THE ADJUSTED RENT  ACTU-
 ALLY  PAID  IN  THE  TAXABLE YEAR BY A HOUSEHOLD SOLELY FOR THE RIGHT OF
 OCCUPANCY OF ITS NEW YORK RESIDENCE FOR THE TAXABLE YEAR. IF (I) A RESI-
 DENCE IS RENTED TO TWO OR MORE INDIVIDUALS AS COTENANTS, OR  SUCH  INDI-
 VIDUALS SHARE IN THE PAYMENT OF A SINGLE RENT FOR THE RIGHT OF OCCUPANCY
 OF  SUCH RESIDENCE, AND (II) EACH OF SUCH INDIVIDUALS  IS A MEMBER OF  A
 DIFFERENT HOUSEHOLD, ONE OR MORE OF WHICH INDIVIDUALS SHARES SUCH  RESI-
 DENCE,  REAL  PROPERTY TAX EQUIVALENT IS THAT PORTION OF FIFTEEN PERCENT
 OF THE ADJUSTED RENT PAID  IN  THE  TAXABLE  YEAR  WHICH  REFLECTS  THAT
 PORTION  OF  THE  RENT  ATTRIBUTABLE  TO  THE QUALIFIED TAXPAYER AND THE
 MEMBERS OF HIS OR HER HOUSEHOLD; AND (2) FOR TAXABLE YEARS BEGINNING  IN
 TWO  THOUSAND TWENTY AND THEREAFTER, TWENTY PERCENT OF THE ADJUSTED RENT
 ACTUALLY PAID IN THE TAXABLE YEAR  BY A HOUSEHOLD SOLELY FOR  THE  RIGHT
 OF  OCCUPANCY  OF  ITS NEW YORK RESIDENCE FOR THE TAXABLE YEAR. IF (I) A
 RESIDENCE IS RENTED TO TWO OR MORE INDIVIDUALS  AS  COTENANTS,  OR  SUCH
 INDIVIDUALS SHARE IN THE PAYMENT OF A SINGLE RENT FOR THE RIGHT OF OCCU-
 PANCY  OF  SUCH RESIDENCE, AND (II) EACH OF SUCH INDIVIDUALS IS A MEMBER
 OF A DIFFERENT HOUSEHOLD, ONE OR MORE OF WHICH INDIVIDUALS  SHARES  SUCH
 RESIDENCE,  REAL  PROPERTY  TAX  EQUIVALENT  IS  THAT  PORTION OF TWENTY
 PERCENT OF THE ADJUSTED RENT PAID IN THE  TAXABLE  YEAR  WHICH  REFLECTS
 THAT  PORTION OF THE RENT ATTRIBUTABLE TO THE QUALIFIED TAXPAYER AND THE
 MEMBERS OF HIS OR HER HOUSEHOLD.
   (F) "NET REAL PROPERTY TAX" MEANS THE REAL PROPERTY TAXES ASSESSED  ON
 THE  RESIDENTIAL  REAL  PROPERTY  OWNED  AND OCCUPIED BY THE TAXPAYER OR
 TAXPAYERS AFTER ANY EXEMPTION OR ABATEMENT RECEIVED PURSUANT TO THE REAL
 PROPERTY TAX LAW.
   (2) CREDIT. A QUALIFIED TAXPAYER SHALL BE ALLOWED A CREDIT AGAINST THE
 TAXES IMPOSED BY THIS ARTICLE, EQUAL TO SEVENTY PERCENT OF THE AMOUNT BY
 WHICH THE TAXPAYER'S NET REAL PROPERTY TAX OR THE TAXPAYER'S REAL  PROP-
 ERTY TAX EQUIVALENT EXCEEDS THE TAXPAYER'S MAXIMUM REAL PROPERTY TAX, AS
 DETERMINED BY PARAGRAPH THREE OF THIS SUBSECTION. IF SUCH CREDIT EXCEEDS

 S. 3982--A                          3
 
 THE TAX FOR SUCH TAXABLE YEAR, AS REDUCED BY THE OTHER CREDITS PERMITTED
 BY  THIS  ARTICLE,  THE  QUALIFIED  TAXPAYER  MAY RECEIVE, AND THE COMP-
 TROLLER, SUBJECT TO A CERTIFICATE OF THE DEPARTMENT,  SHALL  PAY  AS  AN
 OVERPAYMENT, WITHOUT INTEREST, ANY EXCESS BETWEEN SUCH TAX AS SO REDUCED
 AND THE AMOUNT OF THE CREDIT. IF A QUALIFIED TAXPAYER IS NOT REQUIRED TO
 FILE A RETURN PURSUANT TO SECTION SIX HUNDRED FIFTY-ONE OF THIS ARTICLE,
 A  QUALIFIED  TAXPAYER  MAY  NEVERTHELESS  RECEIVE  AND THE COMPTROLLER,
 SUBJECT TO A CERTIFICATE OF THE DEPARTMENT, SHALL PAY AS AN  OVERPAYMENT
 THE FULL AMOUNT OF THE CREDIT, WITHOUT INTEREST.
   (3) MAXIMUM REAL PROPERTY TAX. (A) A QUALIFIED TAXPAYER'S MAXIMUM REAL
 PROPERTY TAX SHALL BE DETERMINED AS FOLLOWS:
   (I) FOR TAX YEARS BEGINNING IN TWO THOUSAND TWENTY:
 HOUSEHOLD GROSS INCOME               MAXIMUM REAL PROPERTY TAX
 ONE HUNDRED THOUSAND                 NINE PERCENT OF THE
 DOLLARS OR LESS                      HOUSEHOLD GROSS INCOME
 MORE THAN ONE HUNDRED                NO LIMITATION.
 THOUSAND DOLLARS
 
   (II) FOR TAX YEARS BEGINNING IN TWO THOUSAND TWENTY-ONE:
 HOUSEHOLD GROSS INCOME               MAXIMUM REAL PROPERTY TAX
 ONE HUNDRED THOUSAND                 EIGHT AND ONE-HALF PERCENT OF THE
 DOLLARS OR LESS                      HOUSEHOLD GROSS INCOME
 MORE THAN ONE HUNDRED                NO LIMITATION.
 THOUSAND DOLLARS
 
   (III) FOR TAX YEARS BEGINNING IN TWO THOUSAND TWENTY-TWO:
 HOUSEHOLD GROSS INCOME               MAXIMUM REAL PROPERTY TAX
 ONE HUNDRED THOUSAND DOLLARS         SEVEN AND ONE-HALF PERCENT OF
 OR LESS                              HOUSEHOLD GROSS INCOME
 MORE THAN ONE HUNDRED THOUSAND       SEVEN AND ONE-HALF PERCENT OF
 DOLLARS, BUT LESS THAN OR EQUAL TO   ONE HUNDRED THOUSAND DOLLARS
 ONE HUNDRED FIFTY THOUSAND DOLLARS   PLUS EIGHT AND ONE-HALF PERCENT OF
                                      HOUSEHOLD GROSS INCOME ABOVE
                                      ONE HUNDRED THOUSAND DOLLARS
 MORE THAN ONE HUNDRED FIFTY          NO LIMITATION.
 THOUSAND DOLLARS
 
   (IV) FOR TAX YEARS BEGINNING IN TWO THOUSAND TWENTY-THREE AND THEREAFTER:
 HOUSEHOLD GROSS INCOME               MAXIMUM REAL PROPERTY TAX
 ONE HUNDRED THOUSAND                 SIX PERCENT OF HOUSEHOLD GROSS
 DOLLARS OR LESS                      INCOME
 MORE THAN ONE HUNDRED THOUSAND       SIX PERCENT OF ONE HUNDRED
 DOLLARS, BUT LESS THAN OR EQUAL TO   THOUSAND DOLLARS PLUS SEVEN
 ONE HUNDRED FIFTY THOUSAND DOLLARS   PERCENT OF HOUSEHOLD GROSS INCOME
                                      ABOVE ONE HUNDRED THOUSAND DOLLARS
 MORE THAN ONE HUNDRED FIFTY          SIX PERCENT OF ONE HUNDRED THOUSAND
 THOUSAND DOLLARS, BUT LESS THAN      DOLLARS PLUS SEVEN
 OR EQUAL TO TWO HUNDRED FIFTY        PERCENT OF FIFTY THOUSAND DOLLARS
 THOUSAND DOLLARS                     PLUS EIGHT AND ONE-HALF PERCENT OF
                                      HOUSEHOLD GROSS INCOME ABOVE ONE
                                      HUNDRED FIFTY THOUSAND DOLLARS
 MORE THAN TWO HUNDRED FIFTY          NO LIMITATION.
 THOUSAND DOLLARS
   (B)  THE  THRESHOLDS  OF  HOUSEHOLD GROSS INCOME ESTABLISHED BY CLAUSE
 (IV) OF  SUBPARAGRAPH  (A)  OF  THIS  PARAGRAPH  SHALL  BE  INDEXED  FOR

 S. 3982--A                          4
 
 INFLATION FOR TAX YEARS BEGINNING IN TWO THOUSAND TWENTY-FOUR AND THERE-
 AFTER.
   (4) EXCLUSIONS FROM ELIGIBILITY. NO CREDIT SHALL BE GRANTED UNDER THIS
 SUBSECTION  IF  THE  QUALIFIED  TAXPAYER  CLAIMS  THE  REAL PROPERTY TAX
 CIRCUIT BREAKER CREDIT, PURSUANT TO  SUBSECTION  (E)  OF  THIS  SECTION,
 DURING THE TAXABLE YEAR.
   §  2.  There  is  hereby  established a tax reform study commission to
 provide the governor and the  legislature  with  a  long  run  plan  for
 reforming  the state and local tax systems. The tax reform study commis-
 sion shall consist of five  members  appointed  by  the  governor,  four
 members  each appointed by the speaker of the assembly and the temporary
 president of the senate, and one member each appointed by  the  minority
 leader  of  the senate and the minority leader of the assembly. In addi-
 tion, on or before January 1, 2022,  the  tax  reform  study  commission
 shall  provide  the governor and the legislature with recommendations on
 any changes that should be made in the definitions of income used in the
 various property tax relief programs authorized by the laws of the state
 of New York. Such recommendations shall be based on  an  examination  of
 such  laws and of such laws in other states. In preparing such recommen-
 dations, the tax reform study commission shall review the distributional
 impact of the items of income included in the  definition  of  household
 income for purposes of the circuit breaker and other property tax relief
 programs established by state law and make recommendations to the gover-
 nor and the legislature for any changes in any of these definitions that
 the  tax  reform study commission deems appropriate. The commissioner of
 taxation and finance and the director of the  office  of  real  property
 services  shall  provide  the tax reform study commission with such data
 and analysis as it may require.
   § 3. This act shall take effect immediately.