S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   4663
 
                        2021-2022 Regular Sessions
 
                           I N  A S S E M B L Y
 
                             February 4, 2021
                                ___________
 
 Introduced by M. of A. PAULIN -- read once and referred to the Committee
   on Ways and Means
 
 AN  ACT  to  amend  the  tax law, in relation to establishing provisions
   related to unincorporated business tax
 
   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 article 24-A to read
 as follows:
                               ARTICLE 24-A
                        UNINCORPORATED BUSINESS TAX
 SECTION 860. DEFINITIONS.
         861. PARTNERSHIP ELECTION.
         862. IMPOSITION AND RATE OF TAX.
         863. TAX CREDITS.
         864. PAYMENT OF ESTIMATED TAX.
         865. FILING OF RETURN AND PAYMENT OF TAX.
         866. ACCOUNTING PERIODS AND METHODS.
         867. PROCEDURAL PROVISIONS.
   §  860. DEFINITIONS. FOR PURPOSES OF THIS ARTICLE, THE FOLLOWING TERMS
 SHALL HAVE THE FOLLOWING MEANINGS:
   (A) AFFECTED PARTNERSHIP. AFFECTED PARTNERSHIP MEANS  ANY  PARTNERSHIP
 AS  PROVIDED  IN  SECTION  7701(A)(2)  OF  THE INTERNAL REVENUE CODE. AN
 AFFECTED PARTNERSHIP INCLUDES ANY LIMITED LIABILITY COMPANY TREATED AS A
 PARTNERSHIP FOR FEDERAL INCOME TAX PURPOSES.
   (B) LOWER-TIER PARTNERSHIP. A LOWER-TIER PARTNERSHIP MEANS  ANY  PART-
 NERSHIP  IN  WHICH AN AFFECTED PARTNERSHIP HAS A DIRECT OWNERSHIP INTER-
 EST.
   (C) UNINCORPORATED BUSINESS TAX. UNINCORPORATED BUSINESS TAX MEANS THE
 TOTAL TAX IMPOSED BY THIS ARTICLE WITHOUT REGARD TO  THE  UNINCORPORATED
 BUSINESS CREDIT CALCULATED UNDER SUBSECTION (A) OF SECTION EIGHT HUNDRED
 SIXTY-THREE OF THIS ARTICLE.
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
              

                                                            LBD08173-01-1

 A. 4663                             2
 
   (D)  UNINCORPORATED  BUSINESS  CREDIT.  UNINCORPORATED BUSINESS CREDIT
 MEANS THE TOTAL CREDIT CALCULATED UNDER SUBSECTION (A) OF SECTION  EIGHT
 HUNDRED  SIXTY-THREE  OF  THIS  ARTICLE WITHOUT REGARD TO ANY LIMITATION
 IMPOSED BY PARAGRAPH THREE OF SUCH SUBSECTION.
   (E)  OWNERSHIP  PERCENTAGE. OWNERSHIP PERCENTAGE MEANS A FRACTION, THE
 NUMERATOR OF WHICH IS THE NET TOTAL OF THE PARTNER'S DISTRIBUTIVE  SHARE
 OF  INCOME,  GAIN, LOSS AND DEDUCTIONS OF, AND GUARANTEED PAYMENTS FROM,
 THE AFFECTED PARTNERSHIP FOR SUCH TAXABLE YEAR, AND THE  DENOMINATOR  OF
 WHICH  IS  THE SUM, FOR SUCH TAXABLE YEAR, OF THE NET TOTAL DISTRIBUTIVE
 SHARES OF INCOME, GAIN, LOSS AND DEDUCTIONS OF, AND GUARANTEED  PAYMENTS
 TO,  ALL PARTNERS IN THE AFFECTED PARTNERSHIP FOR WHOM OR WHICH SUCH NET
 TOTAL AS SEPARATELY DETERMINED FOR EACH PARTNER, IS GREATER THAN ZERO.
   (F) UNINCORPORATED BUSINESS NET INCOME.  UNINCORPORATED  BUSINESS  NET
 INCOME  MEANS  THE  SUM  OF:  (1)  FEDERAL  ORDINARY BUSINESS INCOME, AS
 DESCRIBED IN SECTION 702(A)(8) OF  THE  INTERNAL  REVENUE  CODE  AND  AS
 APPLIED  TO  THE  PARTNERSHIP  PURSUANT  TO  SECTION 703 OF THE INTERNAL
 REVENUE CODE, OF  THE  AFFECTED  PARTNERSHIP;  AND  (2)  TAXES  PAID  OR
 INCURRED  DURING  THE  TAXABLE  YEAR  UNDER THIS ARTICLE BY THE AFFECTED
 PARTNERSHIP TO THE EXTENT DEDUCTED IN COMPUTING FEDERAL ORDINARY INCOME;
 AND (3) GUARANTEED PAYMENTS PAID BY  THE  AFFECTED  PARTNERSHIP  TO  ITS
 PARTNERS AS DESCRIBED IN SECTION 707(C) OF THE INTERNAL REVENUE CODE.
   (G)  UNINCORPORATED  BUSINESS  TAXABLE INCOME. UNINCORPORATED BUSINESS
 TAXABLE INCOME OF AN AFFECTED PARTNERSHIP MEANS  THE  SUM  OF:  (1)  THE
 AFFECTED  PARTNERSHIP'S  UNINCORPORATED  BUSINESS  NET  INCOME  OR LOSS,
 EXCLUDING THE AFFECTED PARTNERSHIP'S  DISTRIBUTIVE  SHARE  OF  ANY  SUCH
 AMOUNTS  FROM A LOWER-TIER PARTNERSHIP INCLUDED IN PARAGRAPH TWO OF THIS
 SUBSECTION, ALLOCATED TO THE STATE PURSUANT TO SUBSECTION (B) OF SECTION
 EIGHT HUNDRED SIXTY-TWO OF THIS  ARTICLE;  AND  (2)  ANY  UNINCORPORATED
 BUSINESS  NET  INCOME  OF  A LOWER-TIER PARTNERSHIP TO THE EXTENT IT WAS
 SOURCED TO THE STATE BY SUCH  LOWER-TIER  PARTNERSHIP  PURSUANT  TO  THE
 PRINCIPLES  OF SUBSECTION (B) OF SECTION EIGHT HUNDRED SIXTY-TWO OF THIS
 ARTICLE.
   § 861.  PARTNERSHIP ELECTION. (A) ANY AFFECTED  PARTNERSHIP  SHALL  BE
 ALLOWED TO MAKE AN ANNUAL ELECTION TO BE TAXED UNDER THIS ARTICLE.
   (B) IN ORDER TO BE EFFECTIVE, THE ANNUAL ELECTION SHALL BE MADE BY ANY
 MEMBER,  OWNER, OR OTHER INDIVIDUAL WITH AUTHORITY TO BIND THE ENTITY OR
 SIGN RETURNS REQUIRED PURSUANT TO SECTION  SIX  HUNDRED  FIFTY-THREE  OF
 THIS CHAPTER.
   (C) THE ANNUAL ELECTION SHALL BE MADE BY DECEMBER FIRST OF EACH CALEN-
 DAR  YEAR  AND  WILL TAKE EFFECT FOR THE IMMEDIATELY SUCCEEDING CALENDAR
 YEAR.  IF AN ELECTION IS MADE AFTER DECEMBER FIRST OF A  CALENDAR  YEAR,
 IT WILL FIRST TAKE EFFECT IN THE SECOND SUCCEEDING CALENDAR YEAR.
   (D)  IF  AN  AFFECTED  PARTNERSHIP  DETERMINES  THAT THE ELECTION MADE
 PURSUANT TO SUBSECTION (A) OF THIS SECTION WAS IN ERROR AND  SUCH  PART-
 NERSHIP WISHES TO REVOKE AN ELECTION FOR THE CALENDAR YEAR AND HAS TAKEN
 NO  ACTION TO COMPLY WITH THE REQUIREMENTS OF THIS ARTICLE, THE EMPLOYER
 MAY REVOKE THE ELECTION. FOR THE CALENDAR YEAR TWO THOUSAND  TWENTY-ONE,
 SUCH  REVOCATION OF THE EMPLOYER ELECTION MAY BE MADE ON OR BEFORE APRIL
 FIFTEENTH, TWO THOUSAND TWENTY-ONE. FOR  CALENDAR  YEARS  BEGINNING  TWO
 THOUSAND  TWENTY-TWO  AND THEREAFTER, SUCH REVOCATION OF THE PARTNERSHIP
 ELECTION SHALL BE MADE NO LATER THAN JANUARY FIFTEENTH OF THE IMMEDIATE-
 LY SUCCEEDING CALENDAR YEAR AFTER THE PARTNERSHIP ELECTION WAS MADE.
   § 862. IMPOSITION AND RATE OF  TAX.  (A)  GENERAL.  A  TAX  IS  HEREBY
 IMPOSED  FOR  EACH  TAXABLE  YEAR ON THE UNINCORPORATED BUSINESS TAXABLE
 INCOME OF EVERY AFFECTED PARTNERSHIP WHICH HAS ELECTED TO BE TAXED UNDER
 THIS ARTICLE.  THIS TAX SHALL BE IN ADDITION TO ANY OTHER TAXES  IMPOSED

 A. 4663                             3
 
 AND SHALL BE AT THE RATE OF FIVE PERCENT FOR EACH TAXABLE YEAR BEGINNING
 ON OR AFTER JANUARY FIRST, TWO THOUSAND TWENTY.
   (B) ALLOCATION TO NEW YORK. IN DETERMINING THE AMOUNT OF UNINCORPORAT-
 ED  BUSINESS  TAXABLE  INCOME, THE UNINCORPORATED BUSINESS NET INCOME OR
 LOSS OF THE AFFECTED PARTNERSHIP SHALL BE ALLOCATED  TO  THIS  STATE  BY
 MULTIPLYING  THE  UNINCORPORATED  BUSINESS  NET  INCOME  OR  LOSS OF THE
 AFFECTED PARTNERSHIP BY THE AVERAGE OF THE FOLLOWING THREE PERCENTAGES:
   (1) PROPERTY PERCENTAGE. THE PROPERTY PERCENTAGE IS COMPUTED BY DIVID-
 ING (A) THE AVERAGE OF THE VALUES, AT THE BEGINNING AND END OF THE TAXA-
 BLE YEAR, OF REAL AND TANGIBLE PERSONAL PROPERTY OWNED AND RENTED BY THE
 AFFECTED PARTNERSHIP AND LOCATED WITHIN THIS STATE, BY (B)  THE  AVERAGE
 OF THE VALUES, AT THE BEGINNING AND END OF THE TAXABLE YEAR, OF ALL REAL
 AND  TANGIBLE PERSONAL PROPERTY OWNED OR RENTED BY THE AFFECTED PARTNER-
 SHIP AND LOCATED BOTH WITHIN AND WITHOUT THE STATE OF NEW YORK.
   (2) PAYROLL PERCENTAGE. THE PAYROLL PERCENTAGE IS COMPUTED BY DIVIDING
 (A) THE TOTAL WAGES, SALARIES AND OTHER  PERSONAL  SERVICE  COMPENSATION
 PAID  OR  INCURRED  DURING THE TAXABLE YEAR TO EMPLOYEES OF THE AFFECTED
 PARTNERSHIP, IN CONNECTION WITH THE  BUSINESS  CARRIED  ON  WITHIN  THIS
 STATE,  BY  (B)  THE  TOTAL  OF  ALL  WAGES, SALARIES AND OTHER PERSONAL
 SERVICE COMPENSATION PAID OR INCURRED DURING THE TAXABLE YEAR TO EMPLOY-
 EES OF THE AFFECTED PARTNERSHIP IN CONNECTION WITH THE BUSINESS  CARRIED
 ON BOTH WITHIN AND WITHOUT THE STATE OF NEW YORK.
   (3)  GROSS  INCOME PERCENTAGE. THE GROSS INCOME PERCENTAGE IS COMPUTED
 BY DIVIDING (A) THE GROSS SALES OR CHARGES FOR SERVICES PERFORMED BY  OR
 THROUGH  AN OFFICE, BRANCH OR AGENCY OF THE AFFECTED PARTNERSHIP LOCATED
 WITHIN THE STATE OF NEW YORK, BY (B) THE TOTAL OF  ALL  GROSS  SALES  OR
 CHARGES FOR SERVICES PERFORMED WITHIN AND WITHOUT THE STATE OF NEW YORK.
 THE  SALES  OR  CHARGES  TO  BE ALLOCATED TO THE STATE INCLUDE ALL SALES
 NEGOTIATED OR CONSUMMATED, AND CHARGES FOR  SERVICES  PERFORMED,  BY  AN
 EMPLOYEE,  AGENT,  AGENCY OR INDEPENDENT CONTRACTOR CHIEFLY SITUATED AT,
 CONNECTED BY CONTRACT OR OTHERWISE WITH,  OR  SENT  OUT  FROM,  OFFICES,
 BRANCHES OF THE AFFECTED PARTNERSHIP, OR OTHER AGENCIES, SITUATED WITHIN
 THE STATE.
   §  863.  TAX  CREDITS. (A) UNINCORPORATED BUSINESS CREDIT. AN AFFECTED
 PARTNERSHIP THAT IS A PARTNER  IN  A  LOWER-TIER  PARTNERSHIP  SHALL  BE
 ALLOWED  A CREDIT AGAINST THE TAX IMPOSED UNDER THIS ARTICLE AS COMPUTED
 UNDER PARAGRAPHS ONE THROUGH THREE OF THIS SUBSECTION.
   (1) CALCULATION OF CREDIT. THE UNINCORPORATED BUSINESS CREDIT SHALL BE
 CALCULATED BY MULTIPLYING THE AFFECTED PARTNERSHIP'S OWNERSHIP  PERCENT-
 AGE OF A LOWER-TIER PARTNERSHIP BY THE LARGER OF:
   (A) THE UNINCORPORATED BUSINESS TAX OF THE LOWER-TIER PARTNERSHIP; OR
   (B)  THE  UNINCORPORATED  BUSINESS CREDIT CALCULATED BY THE LOWER-TIER
 PARTNERSHIP.
   (2) CREDIT FROM MULTIPLE LOWER-TIER ENTITIES. IF AN AFFECTED  PARTNER-
 SHIP  HAS  A DIRECT OWNERSHIP INTEREST IN MORE THAN ONE LOWER-TIER PART-
 NERSHIP, THE UNINCORPORATED BUSINESS CREDIT SHALL  BE  THE  SUM  OF  THE
 CREDITS CALCULATED UNDER PARAGRAPH ONE OF THIS SUBSECTION WITH REGARD TO
 EACH  LOWER-TIER  PARTNERSHIP  IN  WHICH  THE AFFECTED PARTNERSHIP HAS A
 DIRECT OWNERSHIP INTEREST.
   (3) LIMITATION ON CREDIT. IF THE UNINCORPORATED BUSINESS CREDIT CALCU-
 LATED UNDER THIS SUBSECTION FOR ANY TAXABLE YEAR EXCEEDS THE  AMOUNT  OF
 TAX  DUE  UNDER THIS ARTICLE FOR SUCH YEAR, SUCH CREDIT SHALL BE USED TO
 REDUCE THE TAX DUE TO ZERO AND ANY EXCESS SHALL NOT BE CARRIED FORWARD.
   (B) PERSONAL INCOME TAX CREDIT. A TAXPAYER SUBJECT TO TAX UNDER  ARTI-
 CLE TWENTY-TWO OF THIS CHAPTER THAT IS A PARTNER IN AN AFFECTED PARTNER-
 SHIP SUBJECT TO TAX UNDER THIS ARTICLE SHALL BE ALLOWED A CREDIT AGAINST

 A. 4663                             4
 
 THE  TAX  IMPOSED  UNDER  ARTICLE  TWENTY-TWO  OF THIS CHAPTER, COMPUTED
 PURSUANT TO THE PROVISIONS OF SUBSECTION (BBB) OF  SECTION  SIX  HUNDRED
 SIX OF THIS CHAPTER.
   (C)  CORPORATION FRANCHISE TAX CREDIT. A TAXPAYER SUBJECT TO TAX UNDER
 ARTICLE NINE-A OF THIS  CHAPTER  THAT  IS  A  CORPORATE  PARTNER  IN  AN
 AFFECTED  PARTNERSHIP SUBJECT TO TAX UNDER THIS ARTICLE SHALL BE ALLOWED
 A CREDIT AGAINST THE TAX IMPOSED UNDER ARTICLE NINE-A OF  THIS  CHAPTER,
 COMPUTED PURSUANT TO THE PROVISIONS OF SUBDIVISION FIFTY-FIVE OF SECTION
 TWO HUNDRED TEN-B OF THIS CHAPTER.
   §  864. PAYMENT OF ESTIMATED TAX. (A) DEFINITION OF ESTIMATED TAX. FOR
 THE PURPOSES OF THIS SECTION, "ESTIMATED TAX" MEANS THE AMOUNT  THAT  AN
 AFFECTED  PARTNERSHIP  ESTIMATES  TO BE THE TAX IMPOSED BY SECTION EIGHT
 HUNDRED SIXTY-TWO OF THIS ARTICLE FOR THE CURRENT TAXABLE YEAR, LESS THE
 AMOUNT THAT IT ESTIMATES TO BE THE SUM OF ANY CREDITS ALLOWABLE  AGAINST
 THE TAX.
   (B)  GENERAL.  THE  ESTIMATED  TAX  SHALL  BE  PAID  AS FOLLOWS FOR AN
 AFFECTED PARTNERSHIP THAT REPORTS ON A CALENDAR YEAR BASIS:
   (1) IF SUCH ESTIMATED TAX CAN REASONABLY BE  EXPECTED  TO  EXCEED  ONE
 THOUSAND  DOLLARS  ON OR BEFORE MARCH FIFTEENTH OF THE TAXABLE YEAR, THE
 ESTIMATED TAX  SHALL  BE  PAID  IN  FOUR  EQUAL  INSTALLMENTS  ON  MARCH
 FIFTEENTH, JUNE FIFTEENTH, SEPTEMBER FIFTEENTH AND DECEMBER FIFTEENTH.
   (2)  IF  SUCH  ESTIMATED  TAX CAN REASONABLY BE EXPECTED TO EXCEED ONE
 THOUSAND DOLLARS AFTER MARCH FIFTEENTH AND NOT AFTER JUNE  FIFTEENTH  OF
 THE  TAXABLE  YEAR,  THE  ESTIMATED  TAX  SHALL  BE  PAID IN THREE EQUAL
 INSTALLMENTS  ON  JUNE  FIFTEENTH,  SEPTEMBER  FIFTEENTH  AND   DECEMBER
 FIFTEENTH.
   (3)  IF  SUCH  ESTIMATED  TAX CAN REASONABLY BE EXPECTED TO EXCEED ONE
 THOUSAND DOLLARS AFTER JUNE FIFTEENTH AND NOT AFTER SEPTEMBER  FIFTEENTH
 OF  THE  TAXABLE  YEAR,  THE  ESTIMATED  TAX  SHALL BE PAID IN TWO EQUAL
 INSTALLMENTS ON SEPTEMBER FIFTEENTH AND DECEMBER FIFTEENTH.
   (4) IF SUCH ESTIMATED TAX CAN REASONABLY BE  EXPECTED  TO  EXCEED  ONE
 THOUSAND  DOLLARS  AFTER  SEPTEMBER  FIFTEENTH  OF THE TAXABLE YEAR, THE
 ESTIMATED TAX SHALL BE PAID ON DECEMBER FIFTEENTH.
   (C) APPLICATION TO SHORT TAXABLE YEAR. THIS SECTION SHALL APPLY  TO  A
 TAXABLE  YEAR  OF  LESS THAN TWELVE MONTHS IN ACCORDANCE WITH PROCEDURES
 ESTABLISHED BY THE COMMISSIONER.
   (D) FISCAL YEAR. THIS SECTION SHALL APPLY TO A TAXABLE YEAR OTHER THAN
 A CALENDAR YEAR BY THE SUBSTITUTION OF THE MONTHS OF  SUCH  FISCAL  YEAR
 FOR THE CORRESPONDING MONTHS SPECIFIED IN THIS SECTION.
   (E) INSTALLMENTS PAID IN ADVANCE. AN AFFECTED PARTNERSHIP MAY ELECT TO
 PAY  ANY  INSTALLMENT  OF ITS ESTIMATED TAX PRIOR TO THE DATE PRESCRIBED
 FOR THE PAYMENT THEREOF.
   § 865. FILING OF RETURN AND PAYMENT OF TAX. (A) GENERAL. ON OR  BEFORE
 THE  FIFTEENTH DAY OF THE THIRD MONTH FOLLOWING THE CLOSE OF THE TAXABLE
 YEAR, EACH AFFECTED PARTNERSHIP REQUIRED TO FILE A  RETURN  UNDER  PARA-
 GRAPH  ONE  OF SUBSECTION (C) OF SECTION SIX HUNDRED FIFTY-EIGHT OF THIS
 CHAPTER, SHALL ALSO BE REQUIRED TO REPORT THE INFORMATION REQUIRED UNDER
 THIS ARTICLE ON SUCH RETURN.
   (B) INFORMATION ON RETURN. EACH AFFECTED PARTNERSHIP SHALL REPORT  ANY
 TAX  DUE  UNDER  THIS  ARTICLE ON THE FACE OF SUCH RETURN AND SUCH OTHER
 PERTINENT  INFORMATION  AS  THE  COMMISSIONER  MAY  BY  REGULATIONS  AND
 INSTRUCTIONS PRESCRIBE. THE BALANCE OF ANY TAX SHOWN ON THE FACE OF SUCH
 RETURN,  NOT  PREVIOUSLY PAID AS INSTALLMENTS OF ESTIMATED TAX, SHALL BE
 PAID WITH SUCH RETURN.

 A. 4663                             5
 
   (C)  INFORMATION  PROVIDED  TO  PARTNERS.  EACH  AFFECTED  PARTNERSHIP
 SUBJECT  TO  TAX  UNDER  THIS  ARTICLE  SHALL REPORT TO EACH PARTNER ITS
 DISTRIBUTIVE SHARE OF:
   (1)  THE  UNINCORPORATED  BUSINESS NET INCOME OF THE AFFECTED PARTNER-
 SHIP;
   (2) THE UNINCORPORATED BUSINESS TAXABLE INCOME OF THE  AFFECTED  PART-
 NERSHIP;
   (3)  THE  UNINCORPORATED BUSINESS TAX IMPOSED ON THE AFFECTED PARTNER-
 SHIP; AND
   (4)  THE  TOTAL  UNINCORPORATED  BUSINESS  CREDIT  CALCULATED  BY  THE
 AFFECTED  PARTNERSHIP  UNDER  SUBSECTION  (A)  OF  SECTION EIGHT HUNDRED
 SIXTY-THREE OF THIS ARTICLE, BEFORE APPLICATION  OF  THE  LIMITATION  ON
 SUCH CREDIT UNDER PARAGRAPH THREE OF SUCH SUBDIVISION.
   §  866.  ACCOUNTING  PERIODS  AND METHODS. (A) ACCOUNTING PERIODS.  AN
 AFFECTED PARTNERSHIP'S TAXABLE YEAR UNDER THIS ARTICLE SHALL BE THE SAME
 AS THE AFFECTED  PARTNERSHIP'S  TAXABLE  YEAR  FOR  FEDERAL  INCOME  TAX
 PURPOSES.
   (B) ACCOUNTING METHODS. AN AFFECTED PARTNERSHIP'S METHOD OF ACCOUNTING
 UNDER THIS ARTICLE SHALL BE THE SAME AS THE AFFECTED PARTNERSHIP'S METH-
 OD OF ACCOUNTING FOR FEDERAL INCOME TAX PURPOSES.
   (C) CHANGE OF ACCOUNTING PERIOD OR METHOD.
   (1)  IF AN AFFECTED PARTNERSHIP'S TAXABLE YEAR OR METHOD OF ACCOUNTING
 IS CHANGED FOR FEDERAL INCOME TAX PURPOSES, THE TAXABLE YEAR  OR  METHOD
 OF ACCOUNTING FOR PURPOSES OF THIS ARTICLE SHALL BE SIMILARLY CHANGED.
   (2)  IF AN AFFECTED PARTNERSHIP'S METHOD OF ACCOUNTING IS CHANGED, ANY
 ADDITIONAL TAX THAT RESULTS FROM ADJUSTMENTS DETERMINED TO BE  NECESSARY
 SOLELY  BY  REASON  OF  SUCH  CHANGE  SHALL  NOT BE GREATER THAN IF SUCH
 ADJUSTMENTS WERE RATABLY ALLOCATED AND INCLUDED FOR THE TAXABLE YEAR  OF
 THE CHANGE AND THE PRECEDING TAXABLE YEARS, NOT IN EXCESS OF TWO, DURING
 WHICH  THE AFFECTED PARTNERSHIP USED THE METHOD OF ACCOUNTING FROM WHICH
 THE CHANGE IS MADE.
   § 867. PROCEDURAL PROVISIONS. (A) GENERAL. ALL PROVISIONS  OF  ARTICLE
 TWENTY-TWO OF THIS CHAPTER SHALL APPLY TO THE PROVISIONS OF THIS ARTICLE
 IN THE SAME MANNER AND WITH THE SAME FORCE AND EFFECT AS IF THE LANGUAGE
 OF ARTICLE TWENTY-TWO OF THIS CHAPTER HAD BEEN INCORPORATED IN FULL INTO
 THIS  ARTICLE  AND  HAD  BEEN  SPECIFICALLY  ADJUSTED  FOR AND EXPRESSLY
 REFERRED TO THE TAX IMPOSED BY THIS ARTICLE, EXCEPT TO THE  EXTENT  THAT
 ANY  PROVISION IS EITHER INCONSISTENT WITH OR NOT RELEVANT TO THIS ARTI-
 CLE.
   (B) LIABILITY FOR TAX. ONLY THE AFFECTED PARTNERSHIP SHALL  BE  LIABLE
 FOR  THE  TAX  UNDER  THIS  ARTICLE,  AND NO PARTNER SHALL BE PERSONALLY
 LIABLE FOR SUCH TAX.
   (C) DEPOSIT AND DISPOSITION OF REVENUE. ALL  TAXES,  INTEREST,  PENAL-
 TIES,  AND  FEES  COLLECTED  OR  RECEIVED BY THE COMMISSIONER UNDER THIS
 ARTICLE SHALL BE DEPOSITED AND DISPOSED OF PURSUANT TO THE PROVISIONS OF
 SECTION ONE HUNDRED SEVENTY-ONE-A OF THIS CHAPTER.
   (D) SECRECY PROVISION. ALL THE PROVISIONS OF SUBSECTION (A) OF SECTION
 SIX HUNDRED NINETY-SEVEN  OF  THIS  CHAPTER  SHALL  BE  APPLIED  TO  THE
 PROVISIONS  OF  THIS  ARTICLE.    NOTWITHSTANDING ANY PROVISIONS OF THIS
 CHAPTER TO THE CONTRARY, THE COMMISSIONER MAY DISCLOSE  INFORMATION  AND
 RETURNS REGARDING THE CALCULATION AND PAYMENT OF THE TAX IMPOSED BY THIS
 ARTICLE  AND  ANY CREDIT CALCULATED ON TAXES PAID DIRECTLY OR INDIRECTLY
 UNDER THIS ARTICLE TO AN AFFECTED PARTNERSHIP, ITS  LOWER-TIERED  ENTITY
 OR  ENTITIES AND TO ANY TAXPAYER UNDER ARTICLE NINE-A OR ARTICLE TWENTY-
 TWO OF THIS CHAPTER THAT OWNS, IN WHOLE OR IN PART,  DIRECTLY  OR  INDI-
 RECTLY, SUCH AFFECTED PARTNERSHIP.

 A. 4663                             6

   §  2. Section 606 of the tax law is amended by adding a new subsection
 (bbb) to read as follows:
   (BBB)  CREDIT  FOR  UNINCORPORATED  BUSINESS  TAX  FOR PARTNERS. (1) A
 TAXPAYER PARTNER OF AN AFFECTED PARTNERSHIP SUBJECT TO TAX UNDER ARTICLE
 TWENTY-FOUR-A OF THIS CHAPTER SHALL BE ENTITLED TO A CREDIT AGAINST  THE
 TAX  IMPOSED BY THIS ARTICLE. FOR PURPOSES OF THIS SUBSECTION, THE TERMS
 "AFFECTED PARTNERSHIP", "OWNERSHIP PERCENTAGE", "UNINCORPORATED BUSINESS
 TAX" AND "UNINCORPORATED BUSINESS CREDIT" SHALL HAVE THE  SAME  MEANINGS
 AS UNDER ARTICLE TWENTY-FOUR-A OF THIS CHAPTER.
   (2) THE CREDIT SHALL BE EQUAL TO THE PRODUCT OF:
   (I) THE TAXPAYER'S OWNERSHIP PERCENTAGE OF THE AFFECTED PARTNERSHIP;
   (II) NINETY-THREE PERCENT; AND
   (III) THE GREATER OF:
   (A) THE UNINCORPORATED BUSINESS TAX OF THE AFFECTED PARTNERSHIP; OR
   (B) THE UNINCORPORATED BUSINESS CREDIT OF THE AFFECTED PARTNERSHIP.
   (3)  IF A TAXPAYER HAS A DIRECT OWNERSHIP OF A PARTNERSHIP INTEREST IN
 MULTIPLE  AFFECTED   PARTNERSHIPS   SUBJECT   TO   TAX   UNDER   ARTICLE
 TWENTY-FOUR-A OF THIS CHAPTER, THE TAXPAYER'S CREDIT SHALL BE THE SUM OF
 SUCH  CREDITS  CALCULATED  UNDER  PARAGRAPH  TWO OF THIS SUBSECTION WITH
 REGARD TO EACH PARTNERSHIP IN WHICH THE TAXPAYER HAS A DIRECT  OWNERSHIP
 INTEREST.
   (4)  IF  THE  AMOUNT OF THE CREDIT ALLOWABLE UNDER THIS SUBSECTION FOR
 ANY TAXABLE YEAR SHALL EXCEED THE TAXPAYER'S  TAX  FOR  SUCH  YEAR,  THE
 EXCESS ALLOWED FOR THE TAXABLE YEAR MAY BE CARRIED OVER TO THE FOLLOWING
 YEAR  OR YEARS AND MAY BE DEDUCTED FROM THE TAXPAYER'S TAX FOR SUCH YEAR
 OR YEARS.
   § 3. Subparagraph (B) of paragraph 1 of subsection (i) of section  606
 of  the  tax  law  is  amended  by adding a new clause (xlvi) to read as
 follows:
 (XLVI) CREDIT FOR UNINCORPORATED        AMOUNT OF CREDIT
 BUSINESS TAX FOR PARTNERS               UNDER SUBDIVISION
 UNDER SUBSECTION (BBB)                  FIFTY-FIVE OF SECTION
                                         TWO HUNDRED TEN-B
   § 4. Section 210-B of the tax law is amended by adding a new  subdivi-
 sion 55 to read as follows:
   55.  CREDIT FOR UNINCORPORATED BUSINESS TAX FOR PARTNERS. (A) A CORPO-
 RATE PARTNER OF AN AFFECTED PARTNERSHIP SUBJECT  TO  TAX  UNDER  ARTICLE
 TWENTY-FOUR-A  OF THIS CHAPTER SHALL BE ENTITLED TO A CREDIT AGAINST THE
 TAX IMPOSED BY THIS ARTICLE. FOR PURPOSES OF THIS SUBDIVISION, THE TERMS
 "AFFECTED PARTNERSHIP", "OWNERSHIP PERCENTAGE", "UNINCORPORATED BUSINESS
 TAX" AND "UNINCORPORATED BUSINESS CREDIT" SHALL HAVE THE  SAME  MEANINGS
 AS UNDER ARTICLE TWENTY-FOUR-A OF THIS CHAPTER.
   (B) THE CREDIT SHALL BE EQUAL TO THE PRODUCT OF:
   (I) THE TAXPAYER'S OWNERSHIP PERCENTAGE OF THE AFFECTED PARTNERSHIP;
   (II) NINETY-THREE PERCENT; AND
   (III) THE GREATER OF:
   (A) THE UNINCORPORATED BUSINESS TAX OF THE AFFECTED PARTNERSHIP; OR
   (B) THE UNINCORPORATED BUSINESS CREDIT OF THE AFFECTED PARTNERSHIP.
   (C)  IF  A  CORPORATION  HAS  A  DIRECT OWNERSHIP INTEREST IN MULTIPLE
 AFFECTED PARTNERSHIPS SUBJECT TO TAX UNDER ARTICLE TWENTY-FOUR-A OF THIS
 CHAPTER, THE CORPORATION'S CREDIT UNDER THIS SUBDIVISION  SHALL  BE  THE
 SUM  OF  SUCH CREDITS CALCULATED UNDER PARAGRAPH (B) OF THIS SUBDIVISION
 WITH REGARD TO EACH PARTNERSHIP IN WHICH THE CORPORATION  HAS  A  DIRECT
 OWNERSHIP INTEREST.
   (D)  THE  CREDIT  ALLOWED  UNDER THIS SUBDIVISION FOR ANY TAXABLE YEAR
 WILL NOT REDUCE THE TAX FOR SUCH YEAR TO LESS THAN THE AMOUNT PRESCRIBED

 A. 4663                             7
 
 IN PARAGRAPH (D) OF SUBDIVISION ONE OF SECTION TWO HUNDRED TEN  OF  THIS
 ARTICLE. HOWEVER, IF THE AMOUNT OF CREDIT ALLOWED UNDER THIS SUBDIVISION
 FOR  ANY  TAXABLE YEAR REDUCES THE TAX TO SUCH AMOUNT OR IF THE TAXPAYER
 OTHERWISE  PAYS TAX BASED ON THE FIXED DOLLAR MINIMUM AMOUNT, ANY AMOUNT
 OF CREDIT THUS NOT DEDUCTIBLE IN SUCH TAXABLE YEAR MAY BE  CARRIED  OVER
 TO  THE  FOLLOWING YEAR OR YEARS AND MAY BE DEDUCTED FROM THE TAXPAYER'S
 TAX FOR SUCH YEAR OR YEARS.
   § 5. Subdivision 1 of section 171-a of the  tax  law,  as  amended  by
 section  3  of  part XX of chapter 59 of the laws of 2019, is amended to
 read as follows:
   1. All taxes, interest, penalties and fees collected  or  received  by
 the commissioner or the commissioner's duly authorized agent under arti-
 cles nine (except section one hundred eighty-two-a thereof and except as
 otherwise  provided  in  section  two  hundred  five  thereof),  nine-A,
 twelve-A (except as otherwise provided in section  two  hundred  eighty-
 four-d  thereof),  thirteen, thirteen-A (except as otherwise provided in
 section  three  hundred  twelve  thereof),  eighteen,  nineteen,  twenty
 (except  as otherwise provided in section four hundred eighty-two there-
 of), twenty-B, twenty-D, twenty-one,  twenty-two,  twenty-four,  TWENTY-
 FOUR-A,  twenty-six,  twenty-eight  (except  as  otherwise  provided  in
 section  eleven  hundred  two  or   eleven   hundred   three   thereof),
 twenty-eight-A,  twenty-nine-B, thirty-one (except as otherwise provided
 in section fourteen hundred twenty-one thereof), thirty-three and  thir-
 ty-three-A  of this chapter shall be deposited daily in one account with
 such responsible banks, banking houses or  trust  companies  as  may  be
 designated by the comptroller, to the credit of the comptroller. Such an
 account  may  be  established  in one or more of such depositories. Such
 deposits shall be kept separate and apart from all other  money  in  the
 possession  of  the  comptroller. The comptroller shall require adequate
 security from all such depositories. Of the total revenue  collected  or
 received  under  such  articles  of  this chapter, the comptroller shall
 retain in the comptroller's hands such amount as  the  commissioner  may
 determine to be necessary for refunds or reimbursements under such arti-
 cles  of  this chapter out of which amount the comptroller shall pay any
 refunds or reimbursements to which taxpayers shall be entitled under the
 provisions of such articles of this chapter. The  commissioner  and  the
 comptroller  shall  maintain  a system of accounts showing the amount of
 revenue collected or received from each of the  taxes  imposed  by  such
 articles.  The  comptroller,  after  reserving  the  amount  to pay such
 refunds or reimbursements, shall, on or before the  tenth  day  of  each
 month, pay into the state treasury to the credit of the general fund all
 revenue deposited under this section during the preceding calendar month
 and  remaining  to  the  comptroller's  credit  on  the last day of such
 preceding month, (i) except that the comptroller shall pay to the  state
 department of social services that amount of overpayments of tax imposed
 by  article  twenty-two  of this chapter and the interest on such amount
 which is certified to the comptroller by the commissioner as the  amount
 to  be  credited against past-due support pursuant to subdivision six of
 section one hundred seventy-one-c of this article, (ii) and except  that
 the  comptroller  shall  pay  to  the  New  York  state higher education
 services corporation and the state university of New York  or  the  city
 university  of  New York respectively that amount of overpayments of tax
 imposed by article twenty-two of this chapter and the interest  on  such
 amount  which is certified to the comptroller by the commissioner as the
 amount to be credited against the amount of  defaults  in  repayment  of
 guaranteed  student  loans and state university loans or city university

 A. 4663                             8
 
 loans pursuant to subdivision five of section one hundred  seventy-one-d
 and  subdivision  six of section one hundred seventy-one-e of this arti-
 cle, (iii) and except further that, notwithstanding any law,  the  comp-
 troller  shall  credit  to  the  revenue  arrearage account, pursuant to
 section ninety-one-a of the state finance law, that amount  of  overpay-
 ment  of  tax imposed by article nine, nine-A, twenty-two, thirty, thir-
 ty-A, thirty-B or thirty-three of this chapter, and any interest  there-
 on,  which  is  certified  to the comptroller by the commissioner as the
 amount to be credited against a past-due legally enforceable  debt  owed
 to  a  state  agency  pursuant  to  paragraph  (a) of subdivision six of
 section one hundred seventy-one-f of this article, provided, however, he
 shall credit to  the  special  offset  fiduciary  account,  pursuant  to
 section  ninety-one-c of the state finance law, any such amount credita-
 ble as a liability as set forth in paragraph (b) of subdivision  six  of
 section  one  hundred  seventy-one-f  of  this  article, (iv) and except
 further that the comptroller shall pay to the  city  of  New  York  that
 amount  of  overpayment  of tax imposed by article nine, nine-A, twenty-
 two, thirty, thirty-A, thirty-B or thirty-three of this chapter and  any
 interest thereon that is certified to the comptroller by the commission-
 er  as  the  amount  to be credited against city of New York tax warrant
 judgment debt pursuant to section  one  hundred  seventy-one-l  of  this
 article,  (v)  and  except  further  that the comptroller shall pay to a
 non-obligated spouse that amount of overpayment of tax imposed by  arti-
 cle twenty-two of this chapter and the interest on such amount which has
 been credited pursuant to section one hundred seventy-one-c, one hundred
 seventy-one-d,  one  hundred seventy-one-e, one hundred seventy-one-f or
 one hundred seventy-one-l of this article and which is certified to  the
 comptroller  by  the  commissioner  as the amount due such non-obligated
 spouse pursuant to paragraph  six  of  subsection  (b)  of  section  six
 hundred fifty-one of this chapter; and (vi) the comptroller shall deduct
 a  like  amount which the comptroller shall pay into the treasury to the
 credit of the general fund from  amounts  subsequently  payable  to  the
 department  of  social  services,  the state university of New York, the
 city university of New York, or the  higher  education  services  corpo-
 ration,  or  the  revenue  arrearage account or special offset fiduciary
 account pursuant to section ninety-one-a or ninety-one-c  of  the  state
 finance  law, as the case may be, whichever had been credited the amount
 originally withheld from such overpayment, and  (vii)  with  respect  to
 amounts  originally  withheld  from such overpayment pursuant to section
 one hundred seventy-one-l of this article and paid to the  city  of  New
 York,  the  comptroller shall collect a like amount from the city of New
 York.
   § 6. Subdivision 1 of section 171-a of the  tax  law,  as  amended  by
 section  4  of  part XX of chapter 59 of the laws of 2019, is amended to
 read as follows:
   1. All taxes, interest, penalties and fees collected  or  received  by
 the commissioner or the commissioner's duly authorized agent under arti-
 cles nine (except section one hundred eighty-two-a thereof and except as
 otherwise  provided  in  section  two  hundred  five  thereof),  nine-A,
 twelve-A (except as otherwise provided in section  two  hundred  eighty-
 four-d  thereof),  thirteen, thirteen-A (except as otherwise provided in
 section  three  hundred  twelve  thereof),  eighteen,  nineteen,  twenty
 (except  as otherwise provided in section four hundred eighty-two there-
 of), twenty-D, twenty-one, twenty-two, twenty-four, TWENTY-FOUR-A, twen-
 ty-six, twenty-eight (except as otherwise  provided  in  section  eleven
 hundred  two  or  eleven hundred three thereof), twenty-eight-A, twenty-

 A. 4663                             9
 
 nine-B, thirty-one (except as otherwise  provided  in  section  fourteen
 hundred  twenty-one  thereof),  thirty-three  and thirty-three-A of this
 chapter shall be deposited daily in one account  with  such  responsible
 banks,  banking  houses  or  trust companies as may be designated by the
 comptroller, to the credit of the comptroller. Such an  account  may  be
 established  in one or more of such depositories. Such deposits shall be
 kept separate and apart from all other money in the  possession  of  the
 comptroller.  The  comptroller  shall require adequate security from all
 such depositories. Of the total revenue collected or received under such
 articles of this chapter, the comptroller  shall  retain  in  the  comp-
 troller's  hands  such  amount  as  the commissioner may determine to be
 necessary for refunds or reimbursements  under  such  articles  of  this
 chapter  out  of  which  amount the comptroller shall pay any refunds or
 reimbursements to which taxpayers shall be entitled under the provisions
 of such articles of this chapter. The commissioner and  the  comptroller
 shall  maintain  a  system  of  accounts  showing  the amount of revenue
 collected or received from each of the taxes imposed by  such  articles.
 The  comptroller,  after  reserving  the  amount  to pay such refunds or
 reimbursements, shall, on or before the tenth day  of  each  month,  pay
 into  the  state  treasury to the credit of the general fund all revenue
 deposited under this section during the  preceding  calendar  month  and
 remaining  to the comptroller's credit on the last day of such preceding
 month, (i) except that the comptroller shall pay to the state department
 of social services that amount of overpayments of tax imposed by article
 twenty-two of this chapter and the interest  on  such  amount  which  is
 certified  to  the  comptroller  by the commissioner as the amount to be
 credited against past-due support pursuant to subdivision six of section
 one hundred seventy-one-c of this article,  (ii)  and  except  that  the
 comptroller  shall  pay  to the New York state higher education services
 corporation and the state university of New York or the city  university
 of  New  York respectively that amount of overpayments of tax imposed by
 article twenty-two of this chapter and the interest on such amount which
 is certified to the comptroller by the commissioner as the amount to  be
 credited  against  the  amount  of  defaults  in repayment of guaranteed
 student loans and state university loans or city university loans pursu-
 ant to subdivision five of section one hundred seventy-one-d and  subdi-
 vision  six  of section one hundred seventy-one-e of this article, (iii)
 and except further that, notwithstanding any law, the comptroller  shall
 credit   to   the   revenue   arrearage  account,  pursuant  to  section
 ninety-one-a of the state finance law, that amount of overpayment of tax
 imposed by article nine, nine-A, twenty-two, thirty, thirty-A,  thirty-B
 or  thirty-three  of  this  chapter,  and any interest thereon, which is
 certified to the comptroller by the commissioner as  the  amount  to  be
 credited  against  a  past-due  legally enforceable debt owed to a state
 agency pursuant to paragraph (a)  of  subdivision  six  of  section  one
 hundred seventy-one-f of this article, provided, however, he shall cred-
 it  to the special offset fiduciary account, pursuant to section ninety-
 one-c of the state finance law, any such amount creditable as a  liabil-
 ity  as  set  forth  in  paragraph (b) of subdivision six of section one
 hundred seventy-one-f of this article, (iv) and except further that  the
 comptroller shall pay to the city of New York that amount of overpayment
 of  tax  imposed  by article nine, nine-A, twenty-two, thirty, thirty-A,
 thirty-B or thirty-three of this chapter and any interest  thereon  that
 is  certified to the comptroller by the commissioner as the amount to be
 credited against city of New York tax warrant judgment debt pursuant  to
 section  one  hundred  seventy-one-l  of  this  article,  (v) and except

 A. 4663                            10

 further that the comptroller shall pay to a  non-obligated  spouse  that
 amount of overpayment of tax imposed by article twenty-two of this chap-
 ter  and the interest on such amount which has been credited pursuant to
 section  one  hundred  seventy-one-c,  one  hundred  seventy-one-d,  one
 hundred seventy-one-e, one hundred seventy-one-f or one  hundred  seven-
 ty-one-l  of  this  article and which is certified to the comptroller by
 the commissioner as the amount due such non-obligated spouse pursuant to
 paragraph six of subsection (b) of section six hundred fifty-one of this
 chapter; and (vi) the comptroller shall deduct a like amount  which  the
 comptroller  shall  pay  into  the treasury to the credit of the general
 fund from amounts subsequently  payable  to  the  department  of  social
 services,  the  state university of New York, the city university of New
 York, or the higher  education  services  corporation,  or  the  revenue
 arrearage  account  or  special  offset  fiduciary  account  pursuant to
 section ninety-one-a or ninety-one-c of the state finance  law,  as  the
 case  may be, whichever had been credited the amount originally withheld
 from such overpayment, and (vii)  with  respect  to  amounts  originally
 withheld  from such overpayment pursuant to section one hundred seventy-
 one-l of this article and paid to the city of New York, the  comptroller
 shall collect a like amount from the city of New York.
   § 7. This act shall take effect immediately and shall apply to taxable
 years  beginning  on  or after January 1, 2020; provided that the amend-
 ments to subdivision 1 of section 171-a of the tax law made  by  section
 five  of  this  act  shall be subject to the expiration and reversion of
 such subdivision pursuant to section 12 of chapter 90  of  the  laws  of
 2014 when upon such date the provisions of section six of this act shall
 take effect.

                            
 
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                  4663--A
 
                        2021-2022 Regular Sessions
 
                           I N  A S S E M B L Y
 
                             February 4, 2021
                                ___________
 
 Introduced by M. of A. PAULIN -- read once and referred to the Committee
   on  Ways  and  Means  --  committee  discharged, bill amended, ordered
   reprinted as amended and recommitted to said committee
 
 AN ACT to amend the tax law and the state finance law,  in  relation  to
   the imposition of a pass-through entity tax

   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 article 24-A to read
 as follows:
                               ARTICLE 24-A
                          PASS-THROUGH ENTITY TAX
 SECTION 860. DEFINITIONS.
         861. PASS-THROUGH ENTITY TAX ELECTION.
         862. IMPOSITION AND RATE OF TAX.
         863. PASS-THROUGH ENTITY TAX CREDIT.
         864. PAYMENT OF ESTIMATED TAX.
         865. FILING OF RETURN AND PAYMENT OF TAX.
         866. ACCOUNTING PERIODS AND METHODS.
         867. PROCEDURAL PROVISIONS.
   § 860. DEFINITIONS. FOR PURPOSES OF THIS ARTICLE:
   (A) ELIGIBLE PARTNERSHIP.  ELIGIBLE PARTNERSHIP MEANS ANY  PARTNERSHIP
 AS  PROVIDED FOR IN SECTION 7701(A)(2) OF THE INTERNAL REVENUE CODE THAT
 CONSISTS SOLELY OF PARTNERS WHO ARE INDIVIDUALS.   AN ELIGIBLE  PARTNER-
 SHIP INCLUDES ANY LIMITED LIABILITY COMPANY TREATED AS A PARTNERSHIP FOR
 FEDERAL  INCOME  TAX  PURPOSES  THAT OTHERWISE MEETS THE REQUIREMENTS OF
 THIS SUBDIVISION.
   (B) ELIGIBLE S CORPORATION.  ELIGIBLE S CORPORATION MEANS ANY NEW YORK
 S CORPORATION AS DEFINED PURSUANT TO THIS CHAPTER THAT  CONSISTS  SOLELY
 OF  SHAREHOLDERS WHO ARE INDIVIDUALS. AN ELIGIBLE S CORPORATION INCLUDES
 ANY LIMITED LIABILITY COMPANY TREATED AS AN S  CORPORATION  FOR  FEDERAL
 INCOME TAX PURPOSES THAT OTHERWISE MEETS THE REQUIREMENTS OF THIS SUBDI-
 VISION.
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
              

                       [ ] is old law to be omitted.
                                                            LBD08173-02-1

 A. 4663--A                          2
 
   (C)  ELECTING  PARTNERSHIP.    ELECTING PARTNERSHIP MEANS ANY ELIGIBLE
 PARTNERSHIP THAT MADE A VALID, TIMELY ELECTION PURSUANT TO SECTION EIGHT
 HUNDRED SIXTY-ONE OF THIS ARTICLE.
   (D) ELECTING S CORPORATION.  ELECTING S CORPORATION MEANS ANY ELIGIBLE
 S  CORPORATION  THAT  MADE  A VALID, TIMELY ELECTION PURSUANT TO SECTION
 EIGHT HUNDRED SIXTY-ONE OF THIS ARTICLE.
   (E) TAXPAYER. TAXPAYER MEANS ANY ELECTING PARTNERSHIP  OR  ELECTING  S
 CORPORATION.
   (F)  PASS-THROUGH ENTITY TAX.  PASS-THROUGH ENTITY TAX MEANS THE TOTAL
 TAX IMPOSED BY THIS ARTICLE ON  ELECTING  PARTNERSHIPS  AND  ELECTING  S
 CORPORATIONS.
   (G)  PASS-THROUGH  ADJUSTED  NET  INCOME (NOT LESS THAN ZERO).   PASS-
 THROUGH ADJUSTED NET INCOME (NOT LESS THAN ZERO) MEANS:
   (1) IN THE CASE OF AN ELECTING PARTNERSHIP, THE  SUM  OF  (I)  FEDERAL
 TAXABLE  INCOME  (NOT LESS THAN ZERO), AS DESCRIBED IN SECTION 702(A)(8)
 OF THE INTERNAL REVENUE CODE, TO THE  EXTENT  EARNED  DIRECTLY  BY  SUCH
 PARTNERSHIP;  (II) TAXES PAID OR INCURRED DURING THE TAXABLE YEAR PURSU-
 ANT TO THIS ARTICLE BY A PARTNERSHIP TO THE EXTENT DEDUCTED IN COMPUTING
 FEDERAL TAXABLE INCOME; (III) TAXES SUBSTANTIALLY  SIMILAR  TO  THE  TAX
 IMPOSED  PURSUANT  TO  THIS  ARTICLE PAID OR INCURRED DURING THE TAXABLE
 YEAR TO ANOTHER STATE OF THE UNITED STATES, A POLITICAL  SUBDIVISION  OF
 SUCH  STATE,  OR  THE  DISTRICT  OF  COLUMBIA  TO THE EXTENT DEDUCTED IN
 COMPUTING FEDERAL TAXABLE INCOME; AND (IV) GUARANTEED PAYMENTS  PAID  BY
 THE  PARTNERSHIP  TO  ITS PARTNERS AS DESCRIBED IN SECTION 707(C) OF THE
 INTERNAL REVENUE CODE.
   (2) IN THE CASE OF AN ELECTING S CORPORATION, THE SUM OF  (I)  FEDERAL
 NONSEPARATELY  COMPUTED  INCOME  (NOT  LESS  THAN ZERO), AS DESCRIBED IN
 SECTION 1366(A)(2) OF THE INTERNAL REVENUE CODE, WHETHER EARNED BY  SUCH
 S  CORPORATION OR BY A PARTNERSHIP OF WHICH THE S CORPORATION IS A PART-
 NER; (II) TAXES PAID OR INCURRED DURING THE  TAXABLE  YEAR  PURSUANT  TO
 THIS  ARTICLE  BY  AN  S CORPORATION TO THE EXTENT DEDUCTED IN COMPUTING
 FEDERAL ORDINARY INCOME; AND (III) TAXES SUBSTANTIALLY  SIMILAR  TO  THE
 TAX IMPOSED PURSUANT TO THIS ARTICLE PAID OR INCURRED DURING THE TAXABLE
 YEAR  TO  ANOTHER STATE OF THE UNITED STATES, A POLITICAL SUBDIVISION OF
 SUCH STATE, OR THE DISTRICT  OF  COLUMBIA  TO  THE  EXTENT  DEDUCTED  IN
 COMPUTING FEDERAL TAXABLE INCOME.
   (H)  PARTNERSHIP  TAXABLE  INCOME.    PARTNERSHIP TAXABLE INCOME OF AN
 ELECTING PARTNERSHIP MEANS THE SUM OF  (1)  THE  ELECTING  PARTNERSHIP'S
 PASS-THROUGH  ADJUSTED NET INCOME (NOT LESS THAN ZERO), ALLOCATED TO NEW
 YORK STATE PURSUANT TO SUBDIVISION (B) OF SECTION EIGHT  HUNDRED  SIXTY-
 TWO  OF  THIS  ARTICLE; AND (2) THE ELECTING PARTNERSHIP'S PROPORTIONATE
 SHARE OF ANY PASS-THROUGH ADJUSTED NET INCOME (NOT LESS THAN ZERO)  FROM
 A  PARTNERSHIP  OF WHICH IT IS A PARTNER TO THE EXTENT IT WAS SOURCED TO
 NEW YORK BY SUCH PARTNERSHIP PURSUANT TO THE PRINCIPLES OF ARTICLE TWEN-
 TY-TWO OF THIS CHAPTER.
   (I) S CORPORATION TAXABLE INCOME.  S CORPORATION TAXABLE INCOME OF  AN
 ELECTING  S  CORPORATION MEANS THE ELECTING S CORPORATION'S PASS-THROUGH
 ADJUSTED NET INCOME (NOT LESS THAN ZERO) ALLOCATED  TO  NEW  YORK  STATE
 PURSUANT  TO  SUBDIVISION (C) OF SECTION EIGHT HUNDRED SIXTY-TWO OF THIS
 ARTICLE.
   § 861. PASS-THROUGH ENTITY TAX ELECTION. (A) ANY ELIGIBLE  PARTNERSHIP
 OR  ELIGIBLE  S  CORPORATION  DOING  BUSINESS WITHIN THIS STATE SHALL BE
 ALLOWED TO MAKE AN ANNUAL ELECTION TO BE TAXED PURSUANT TO THIS ARTICLE.
   (B) IN ORDER TO BE EFFECTIVE, THE ANNUAL ELECTION MUST BE MADE (1)  IF
 THE  ENTITY  IS AN S CORPORATION, BY ANY OFFICER, MANAGER OR SHAREHOLDER
 OF THE S CORPORATION WHO IS AUTHORIZED UNDER THE LAW OF THE STATE  WHERE

 A. 4663--A                          3
 
 THE  CORPORATION  IS INCORPORATED OR UNDER THE S CORPORATION'S ORGANIZA-
 TIONAL DOCUMENTS TO MAKE THE ELECTION AND WHO REPRESENTS TO HAVING  SUCH
 AUTHORIZATION UNDER PENALTY OF PERJURY; OR (2) IF THE ENTITY IS NOT AN S
 CORPORATION,  BY  ANY  MEMBER,  PARTNER, OWNER, OR OTHER INDIVIDUAL WITH
 AUTHORITY TO BIND THE ENTITY OR SIGN RETURNS  PURSUANT  TO  SECTION  SIX
 HUNDRED FIFTY-THREE OF THIS CHAPTER.
   (C) IF THE ELIGIBLE PARTNERSHIP OR ELIGIBLE S CORPORATION REPORTS ON A
 CALENDAR  YEAR BASIS, THE ANNUAL ELECTION MUST BE MADE BY DECEMBER FIRST
 OF EACH CALENDAR YEAR AND WILL TAKE EFFECT FOR THE IMMEDIATELY  SUCCEED-
 ING  CALENDAR  YEAR.    IF AN ELECTION IS MADE AFTER DECEMBER FIRST OF A
 CALENDAR YEAR, IT WILL FIRST TAKE EFFECT IN THE SECOND SUCCEEDING CALEN-
 DAR YEAR.
   (D) IF THE ELIGIBLE PARTNERSHIP OR ELIGIBLE S CORPORATION REPORTS ON A
 FISCAL YEAR BASIS, THE ANNUAL ELECTION MUST BE MADE BY THE FIRST DAY  OF
 THE  LAST FULL MONTH PRIOR TO THE START OF THE FISCAL YEAR AND WILL TAKE
 EFFECT FOR THE IMMEDIATELY SUCCEEDING FISCAL YEAR.   IF AN  ELECTION  IS
 MADE AFTER SUCH DATE, IT WILL FIRST TAKE EFFECT IN THE SECOND SUCCEEDING
 FISCAL YEAR.
   (E)  (1)  TERMINATION OF ELECTION. AN ELECTION PURSUANT TO SUBDIVISION
 (A) OF THIS SECTION SHALL BE TERMINATED WHENEVER, AT ANY TIME DURING THE
 TAXABLE YEAR, THE TAXPAYER CEASES  TO  BE  AN  ELIGIBLE  PARTNERSHIP  OR
 ELIGIBLE S CORPORATION.
   (2)  EFFECTIVE  DATE OF TERMINATION. THE TERMINATION OF AN ELECTION IS
 EFFECTIVE IMMEDIATELY UPON THE TAXPAYER CEASING TO BE AN ELIGIBLE  PART-
 NERSHIP  OR  ELIGIBLE  S  CORPORATION AND NO TAX WILL BE DUE PURSUANT TO
 THIS ARTICLE FOR THE TAXABLE YEAR.
   (3) ABATEMENT OF PENALTIES.  IF A TERMINATION OCCURS PURSUANT TO  THIS
 SUBDIVISION SOLELY BECAUSE A PARTNER, MEMBER OR SHAREHOLDER OF AN OTHER-
 WISE  ELIGIBLE  PARTNERSHIP  OR  ELIGIBLE  S CORPORATION DIED DURING THE
 TAXABLE YEAR AND THE SUCCESSOR TO THE DECEDENT'S INTEREST IN  THE  PART-
 NERSHIP  OR  S CORPORATION IS NOT AN INDIVIDUAL, NO ADDITION TO TAX WILL
 BE IMPOSED PURSUANT TO SUBSECTION (C) OF SECTION SIX HUNDRED EIGHTY-FIVE
 OF THIS CHAPTER ON THE PARTNERS, MEMBERS AND SHAREHOLDERS OF SUCH  PART-
 NERSHIP  OR  S CORPORATION SOLELY FOR UNDERPAYMENT OF ESTIMATED PERSONAL
 INCOME TAX AS A RESULT OF THE TERMINATION OF THE ELECTION MADE  PURSUANT
 TO THIS ARTICLE.
   §  862.  IMPOSITION  AND  RATE  OF TAX. (A) GENERAL.   A TAX IS HEREBY
 IMPOSED FOR EACH TAXABLE YEAR ON THE PARTNERSHIP TAXABLE INCOME OF EVERY
 ELECTING PARTNERSHIP DOING BUSINESS WITHIN  THIS  STATE  AND  ON  THE  S
 CORPORATION  TAXABLE  INCOME OF EVERY ELECTING S CORPORATION DOING BUSI-
 NESS WITHIN THIS STATE. THIS TAX SHALL BE IN ADDITION TO ANY OTHER TAXES
 IMPOSED AND SHALL BE AT THE  RATE  OF  SIX  AND  EIGHTY-FIVE  HUNDREDTHS
 PERCENT  FOR  EACH TAXABLE YEAR BEGINNING ON OR AFTER JANUARY FIRST, TWO
 THOUSAND TWENTY-TWO.
   (B) ALLOCATION TO NEW YORK BY AN ELECTING PARTNERSHIP.  IN DETERMINING
 THE AMOUNT OF PARTNERSHIP TAXABLE INCOME, THE ADJUSTED NET INCOME OF THE
 ELECTING PARTNERSHIP SHALL BE ALLOCATED TO THIS STATE  PURSUANT  TO  THE
 PRINCIPLES OF ARTICLE TWENTY-TWO OF THIS CHAPTER.
   (C) ALLOCATION TO NEW YORK BY AN ELECTING S CORPORATION.  IN DETERMIN-
 ING  THE AMOUNT OF S CORPORATION TAXABLE INCOME, THE ADJUSTED NET INCOME
 OF THE ELECTING S CORPORATION SHALL BE ALLOCATED TO THIS STATE BY MULTI-
 PLYING THE ADJUSTED NET INCOME OF THE  ELECTING  S  CORPORATION  BY  THE
 BUSINESS  APPORTIONMENT  FACTOR  OF THE ELECTING S CORPORATION AS CALCU-
 LATED PURSUANT TO SECTION TWO HUNDRED TEN-A OF THIS CHAPTER.
   § 863. PASS-THROUGH ENTITY TAX CREDIT. AN INDIVIDUAL  SUBJECT  TO  TAX
 UNDER  ARTICLE TWENTY-TWO OF THIS CHAPTER THAT IS A PARTNER OR MEMBER IN

 A. 4663--A                          4
 
 AN ELECTING PARTNERSHIP OR A SHAREHOLDER OF AN  ELECTING  S  CORPORATION
 SUBJECT  TO TAX UNDER THIS ARTICLE SHALL BE ALLOWED A CREDIT AGAINST THE
 TAX IMPOSED PURSUANT TO ARTICLE TWENTY-TWO  OF  THIS  CHAPTER,  COMPUTED
 PURSUANT  TO  THE  PROVISIONS OF SUBSECTION (KKK) OF SECTION SIX HUNDRED
 SIX OF THIS CHAPTER.
   § 864. PAYMENT OF ESTIMATED TAX.  (A)  DEFINITION  OF  ESTIMATED  TAX.
 ESTIMATED  TAX MEANS THE AMOUNT THAT AN ELECTING PARTNERSHIP OR ELECTING
 S CORPORATION ESTIMATES TO BE THE TAX IMPOSED BY SECTION  EIGHT  HUNDRED
 SIXTY-TWO OF THIS ARTICLE FOR THE CURRENT TAXABLE YEAR.
   (B)  GENERAL. THE ESTIMATED TAX SHALL BE PAID AS FOLLOWS FOR AN ELECT-
 ING PARTNERSHIP AND AN ELECTING S CORPORATION THAT REPORTS ON A CALENDAR
 YEAR BASIS:
   (1) THE ESTIMATED TAX SHALL BE PAID  IN  FOUR  EQUAL  INSTALLMENTS  ON
 MARCH  FIFTEENTH,  JUNE  FIFTEENTH,  SEPTEMBER  FIFTEENTH  AND  DECEMBER
 FIFTEENTH.
   (2) THE AMOUNT  OF  ANY  REQUIRED  INSTALLMENT  SHALL  BE  TWENTY-FIVE
 PERCENT OF THE REQUIRED ANNUAL PAYMENT.
   (3)  THE  REQUIRED ANNUAL PAYMENT IS THE LESSER OF: (A) NINETY PERCENT
 OF THE TAX SHOWN ON THE RETURN FOR THE TAXABLE YEAR; OR (B) ONE  HUNDRED
 PERCENT  OF  THE  TAX SHOWN ON THE RETURN OF THE ELECTING PARTNERSHIP OR
 ELECTING S CORPORATION FOR THE PRECEDING TAXABLE YEAR.
   (C) APPLICATION TO SHORT TAXABLE YEAR.  THIS SECTION SHALL APPLY TO  A
 TAXABLE  YEAR  OF  LESS THAN TWELVE MONTHS IN ACCORDANCE WITH PROCEDURES
 ESTABLISHED BY THE COMMISSIONER.
   (D) FISCAL YEAR. THIS SECTION SHALL APPLY TO A TAXABLE YEAR OTHER THAN
 A CALENDAR YEAR BY THE SUBSTITUTION OF THE MONTHS OF  SUCH  FISCAL  YEAR
 FOR THE CORRESPONDING MONTHS SPECIFIED IN THIS SECTION.
   (E)  INSTALLMENTS PAID IN ADVANCE. AN ELECTING PARTNERSHIP OR ELECTING
 S CORPORATION MAY ELECT TO PAY ANY  INSTALLMENT  OF  ITS  ESTIMATED  TAX
 PRIOR TO THE DATE PRESCRIBED FOR THE PAYMENT THEREOF.
   §  865. FILING OF RETURN AND PAYMENT OF TAX. (A) GENERAL. ON OR BEFORE
 THE FIFTEENTH DAY OF THE THIRD MONTH FOLLOWING THE CLOSE OF THE  TAXABLE
 YEAR,  EACH  ELECTING  PARTNERSHIP  AND EACH ELECTING S CORPORATION MUST
 FILE A RETURN FOR THE TAXABLE YEAR REPORTING  THE  INFORMATION  REQUIRED
 PURSUANT TO THIS ARTICLE.
   (B)  CERTIFICATION  OF  ELIGIBILITY.    EVERY RETURN FILED PURSUANT TO
 SUBDIVISION (A) OF THIS SECTION SHALL INCLUDE, IN A FORMAT AS PRESCRIBED
 BY THE COMMISSIONER, A CERTIFICATION BY AN INDIVIDUAL AUTHORIZED TO  ACT
 ON BEHALF OF THE ELECTING PARTNERSHIP OR ELECTING S CORPORATION THAT THE
 TAXPAYER:
   (1)  MADE  A  TIMELY,  VALID ELECTION TO BE SUBJECT TO TAX PURSUANT TO
 THIS ARTICLE;
   (2) WAS AT ALL TIMES DURING THE TAXABLE YEAR ELIGIBLE TO MAKE SUCH  AN
 ELECTION,  UNLESS  SUCH RETURN INCLUDES A NOTIFICATION OF TERMINATION AS
 PROVIDED FOR IN SUBDIVISION (C) OF THIS SECTION; AND
   (3) THAT ALL STATEMENTS CONTAINED THEREIN ARE TRUE.
   (C) NOTIFICATION OF TERMINATION.  IF AN ELECTION IS TERMINATED  DURING
 THE  TAXABLE  YEAR  PURSUANT TO SUBDIVISION (E) OF SECTION EIGHT HUNDRED
 SIXTY-ONE OF THIS ARTICLE, THE ELECTING PARTNERSHIP OR ELECTING S CORPO-
 RATION IS REQUIRED TO FILE A RETURN PURSUANT TO SUBDIVISION (A) OF  THIS
 SECTION  NOTIFYING THE COMMISSIONER OF SUCH TERMINATION.  SUCH NOTIFICA-
 TION WILL BE CONSIDERED A CLAIM FOR A CREDIT OR REFUND OF AN OVERPAYMENT
 OF PASS-THROUGH ENTITY TAX OF ANY ESTIMATED PAYMENTS  MADE  PURSUANT  TO
 THIS ARTICLE FOR THE TAXABLE YEAR CONTAINING THE DATE OF TERMINATION.
   (D)  INFORMATION  ON  RETURN. EACH ELECTING PARTNERSHIP AND ELECTING S
 CORPORATION SHALL REPORT ON SUCH RETURN:

 A. 4663--A                          5
 
   (1) THE BALANCE OF ANY TAX SHOWN ON SUCH RETURN, NOT  PREVIOUSLY  PAID
 AS INSTALLMENTS OF ESTIMATED TAX, SHALL BE PAID WITH SUCH RETURN;
   (2) IDENTIFYING INFORMATION OF ALL PARTNERS, MEMBERS AND/OR SHAREHOLD-
 ERS ELIGIBLE TO RECEIVE A CREDIT PURSUANT TO SECTION EIGHT HUNDRED SIXTY
 THREE  AND SUCH PARTNER'S, MEMBER'S AND/OR SHAREHOLDER'S DISTRIBUTIVE OR
 PRO RATA SHARE OF THE PASS-THROUGH ENTITY TAX IMPOSED  ON  THE  ELECTING
 PARTNERSHIP OR S CORPORATION; AND
   (3) ANY OTHER INFORMATION AS REQUIRED BY THE COMMISSIONER.
   (E)  INFORMATION  PROVIDED  TO  PARTNERS.  EACH  ELECTING  PARTNERSHIP
 SUBJECT TO TAX UNDER THIS ARTICLE SHALL REPORT TO EACH PARTNER OR MEMBER
 ITS DISTRIBUTIVE SHARE OF:
   (1) THE PARTNERSHIP TAXABLE INCOME OF THE ELECTING PARTNERSHIP;
   (2) THE PASS-THROUGH ENTITY TAX IMPOSED ON THE  ELECTING  PARTNERSHIP;
 AND
   (3) ANY OTHER INFORMATION AS REQUIRED BY THE COMMISSIONER.
   (F)  INFORMATION PROVIDED TO SHAREHOLDERS. EACH ELECTING S CORPORATION
 SUBJECT TO TAX UNDER THIS ARTICLE SHALL REPORT TO EACH  SHAREHOLDER  ITS
 PRO RATA SHARE OF:
   (1) THE S CORPORATION TAXABLE INCOME OF THE ELECTING S CORPORATION;
   (2) THE PASS-THROUGH ENTITY TAX IMPOSED ON THE ELECTING S CORPORATION;
 AND
   (3) ANY OTHER INFORMATION AS REQUIRED BY THE COMMISSIONER.
   §  866.  ACCOUNTING  PERIODS  AND  METHODS. (A) ACCOUNTING PERIODS. AN
 ELECTING PARTNERSHIP'S OR ELECTING S CORPORATION'S TAXABLE YEAR PURSUANT
 TO THIS ARTICLE SHALL BE THE  SAME  AS  THE  ELECTING  PARTNERSHIP'S  OR
 ELECTING S CORPORATION'S TAXABLE YEAR FOR FEDERAL INCOME TAX PURPOSES.
   (B) ACCOUNTING METHODS. AN ELECTING PARTNERSHIP'S OR ELECTING S CORPO-
 RATION'S METHOD OF ACCOUNTING PURSUANT TO THIS ARTICLE SHALL BE THE SAME
 AS  THE  ELECTING  PARTNERSHIP'S  OR  ELECTING S CORPORATION'S METHOD OF
 ACCOUNTING FOR FEDERAL INCOME TAX PURPOSES.
   (C) CHANGE OF ACCOUNTING PERIOD OR METHOD. (1) IF AN ELECTING PARTNER-
 SHIP'S OR ELECTING S CORPORATION'S TAXABLE YEAR OR METHOD OF  ACCOUNTING
 IS  CHANGED  FOR FEDERAL INCOME TAX PURPOSES, THE TAXABLE YEAR OR METHOD
 OF ACCOUNTING FOR PURPOSES OF THIS ARTICLE SHALL BE SIMILARLY CHANGED.
   (2) IF AN ELECTING PARTNERSHIP'S OR ELECTING S CORPORATION'S METHOD OF
 ACCOUNTING IS CHANGED, ANY ADDITIONAL TAX THAT RESULTS FROM  ADJUSTMENTS
 DETERMINED  TO BE NECESSARY SOLELY BY REASON OF SUCH CHANGE SHALL NOT BE
 GREATER THAN IF SUCH ADJUSTMENTS WERE RATABLY ALLOCATED AND INCLUDED FOR
 THE TAXABLE YEAR OF THE CHANGE AND THE PRECEDING TAXABLE YEARS,  NOT  IN
 EXCESS  OF  TWO,  DURING  WHICH THE ENTITY USED THE METHOD OF ACCOUNTING
 FROM WHICH THE CHANGE IS MADE.
   § 867. PROCEDURAL PROVISIONS.  (A) GENERAL.  ALL PROVISIONS OF ARTICLE
 TWENTY-TWO OF THIS CHAPTER WILL APPLY TO THE PROVISIONS OF THIS  ARTICLE
 IN THE SAME MANNER AND WITH THE SAME FORCE AND EFFECT AS IF THE LANGUAGE
 OF ARTICLE TWENTY-TWO OF THIS CHAPTER HAD BEEN INCORPORATED IN FULL INTO
 THIS  ARTICLE  AND  HAD  BEEN  SPECIFICALLY  ADJUSTED  FOR AND EXPRESSLY
 REFERRED TO THE TAX IMPOSED BY THIS ARTICLE, EXCEPT TO THE  EXTENT  THAT
 ANY PROVISION IS EITHER INCONSISTENT WITH A PROVISION OF THIS ARTICLE OR
 IS NOT RELEVANT TO THIS ARTICLE. NOTWITHSTANDING THE PRECEDING SENTENCE,
 NO  CREDIT AGAINST TAX IN ARTICLE TWENTY-TWO OF THIS CHAPTER CAN BE USED
 TO OFFSET THE TAX DUE PURSUANT TO THIS ARTICLE.
   (B) CROSS ARTICLE FILINGS. NOTWITHSTANDING  ANY  OTHER  PROVISIONS  OF
 THIS ARTICLE:
   (1)  THE  COMMISSIONER  MAY REQUIRE THE FILING OF ONE RETURN WHICH, IN
 ADDITION TO THE RETURN PROVIDED FOR IN SECTION EIGHT HUNDRED  SIXTY-FIVE
 OF  THIS  ARTICLE,  MAY  ALSO  INCLUDE ANY OF THE RETURNS REQUIRED TO BE

 A. 4663--A                          6

 FILED BY A TAXPAYER PURSUANT TO THE  PROVISIONS  OF  SUBSECTION  (C)  OF
 SECTION SIX HUNDRED FIFTY-EIGHT OR ARTICLE NINE-A OF THIS CHAPTER.
   (2)  WHERE  SUCH RETURN IS REQUIRED, THE COMMISSIONER MAY ALSO REQUIRE
 THE PAYMENT WITH IT OF A SINGLE AMOUNT WHICH SHALL EQUAL  THE  TOTAL  OF
 THE  AMOUNTS  (TOTAL  TAXES LESS ANY CREDITS OR REFUNDS) THAT WOULD HAVE
 BEEN REQUIRED TO BE PAID WITH THE RETURNS PURSUANT TO THE PROVISIONS  OF
 THIS ARTICLE AND THE PROVISIONS OF ARTICLE TWENTY-TWO OF THIS CHAPTER OR
 THE  PROVISIONS OF ARTICLE NINE-A OF THIS CHAPTER, WHICHEVER IS APPLICA-
 BLE.
   (3) NOTWITHSTANDING ANY OTHER LAW TO THE  CONTRARY,  THE  COMMISSIONER
 MAY  REQUIRE  THAT ALL FORMS OR RETURNS PURSUANT TO THIS ARTICLE MUST BE
 FILED ELECTRONICALLY AND ALL PAYMENTS OF  TAX  MUST  BE  PAID  ELECTRON-
 ICALLY.
   (C)  LIABILITY  FOR TAX.  AN ELECTING PARTNERSHIP OR ELECTING S CORPO-
 RATION SHALL BE LIABLE FOR THE TAX DUE  PURSUANT  TO  THIS  ARTICLE.  IN
 ADDITION,  EVERY  INDIVIDUAL  ELIGIBLE  TO  CLAIM  A  CREDIT PURSUANT TO
 SUBSECTION (KKK) OF SECTION SIX HUNDRED SIX OF THIS CHAPTER  BECAUSE  HE
 OR SHE IS A PARTNER OR MEMBER IN AN ELECTING PARTNERSHIP OR A SHAREHOLD-
 ER  IN  AN  ELECTING S CORPORATION SHALL BE JOINTLY AND SEVERALLY LIABLE
 FOR THE TAX IMPOSED PURSUANT TO THIS ARTICLE ON SUCH  ELECTING  PARTNER-
 SHIP OR ELECTING S CORPORATION.
   (D)  DEPOSIT  AND DISPOSITION OF REVENUE.  ALL TAXES, INTEREST, PENAL-
 TIES, AND FEES COLLECTED OR RECEIVED BY  THE  COMMISSIONER  PURSUANT  TO
 THIS  ARTICLE  SHALL  BE  DEPOSITED  AND  DISPOSED  OF  PURSUANT  TO THE
 PROVISIONS OF SECTION ONE HUNDRED SEVENTY-ONE-A OF THIS CHAPTER.
   (E) SECRECY PROVISION. ALL THE PROVISIONS OF PARAGRAPHS ONE AND TWO OF
 SUBSECTION (E) OF SECTION SIX HUNDRED NINETY-SEVEN OF THIS CHAPTER  WILL
 APPLY  TO THE PROVISIONS OF THIS ARTICLE. NOTWITHSTANDING ANY PROVISIONS
 OF THIS CHAPTER TO THE CONTRARY, THE COMMISSIONER MAY DISCLOSE  INFORMA-
 TION  AND  RETURNS  REGARDING  THE  CALCULATION  AND  PAYMENT OF THE TAX
 IMPOSED BY THIS ARTICLE AND ANY CREDIT CALCULATED ON TAXES PAID PURSUANT
 TO THIS ARTICLE BY AN ELECTING PARTNERSHIP OR ELECTING S CORPORATION  TO
 A PARTNER, MEMBER OR SHAREHOLDER OF SUCH ENTITY.
   §  2. Section 606 of the tax law is amended by adding a new subsection
 (kkk) to read as follows:
   (KKK) CREDIT FOR PASS-THROUGH ENTITY TAX. (1) A  TAXPAYER  PARTNER  OR
 MEMBER  OF  AN  ELECTING  PARTNERSHIP  AND  A TAXPAYER SHAREHOLDER OF AN
 ELECTING S CORPORATION SUBJECT TO TAX  UNDER  ARTICLE  TWENTY-FOUR-A  OF
 THIS  CHAPTER  SHALL  BE ENTITLED TO A CREDIT AGAINST THE TAX IMPOSED BY
 THIS ARTICLE AS PROVIDED IN THIS  SUBSECTION.    FOR  PURPOSES  OF  THIS
 SUBSECTION,  THE TERMS "ELECTING PARTNERSHIP," "ELECTING S CORPORATION,"
 AND "PASS-THROUGH ENTITY TAX" SHALL HAVE THE SAME MEANINGS  AS  USED  IN
 ARTICLE TWENTY-FOUR-A OF THIS CHAPTER.
   (2) THE CREDIT SHALL BE EQUAL TO THE PRODUCT OF:
   (I)  THE  TAXPAYER'S  PROFIT PERCENTAGE OF THE ELECTING PARTNERSHIP OR
 PRO RATA SHARE OF THE ELECTING S CORPORATION;
   (II) NINETY-TWO PERCENT; AND
   (III) THE PASS-THROUGH ENTITY TAX PAID BY THE ELECTING PARTNERSHIP  OR
 S CORPORATION FOR THE TAXABLE YEAR.
   (3)  IF  A  TAXPAYER  IS  A PARTNER, MEMBER OR SHAREHOLDER IN MULTIPLE
 ELECTING PARTNERSHIPS AND/OR ELECTING  S  CORPORATIONS  SUBJECT  TO  TAX
 PURSUANT TO ARTICLE TWENTY-FOUR-A OF THIS CHAPTER, THE TAXPAYER'S CREDIT
 SHALL BE THE SUM OF SUCH CREDITS CALCULATED PURSUANT TO PARAGRAPH TWO OF
 THIS  SUBSECTION  WITH REGARD TO EACH ENTITY IN WHICH THE TAXPAYER HAS A
 DIRECT OWNERSHIP INTEREST.

 A. 4663--A                          7

   (4) IF THE AMOUNT OF THE CREDIT ALLOWABLE PURSUANT TO THIS  SUBSECTION
 FOR ANY TAXABLE YEAR EXCEEDS THE TAX DUE FOR SUCH YEAR PURSUANT  TO THIS
 ARTICLE,  THE  EXCESS SHALL BE TREATED AS AN OVERPAYMENT, TO BE CREDITED
 OR REFUNDED, WITHOUT INTEREST.
   §  3.  Section 620 of the tax law, as amended by chapter 2 of the laws
 of 1962, subsection (a) as amended and paragraph 3 of subsection (b)  as
 added by chapter 274 of the laws of 1987, and subsection (d) as added by
 chapter 166 of 1991, is amended to read as follows:
   § 620. Credit for income tax of another state. (a) General. A resident
 shall be allowed a credit against the tax otherwise due under this arti-
 cle  for  any income tax imposed ON SUCH INDIVIDUAL for the taxable year
 by another state of the United States, a political subdivision  of  such
 state,  the  District  of  Columbia or a province of Canada, upon income
 both derived therefrom and subject to tax under this article.  The  term
 "income  tax  imposed"  in  the  previous sentence shall not include the
 portion of such tax (determined in the manner provided  for  in  section
 six  hundred twenty-A) which is imposed upon the ordinary income portion
 (or part thereof) of a lump sum distribution which  is  subject  to  the
 separate tax imposed by section [six hundred one-C] SIX HUNDRED THREE.
   (b) PASS-THROUGH ENTITY TAXES. (1) A RESIDENT SHALL BE ALLOWED A CRED-
 IT  AGAINST THE TAX OTHERWISE DUE PURSUANT TO THIS ARTICLE FOR ANY PASS-
 THROUGH ENTITY TAX SUBSTANTIALLY SIMILAR TO THE TAX IMPOSED PURSUANT  TO
 ARTICLE  TWENTY-FOUR-A  OF THIS CHAPTER IMPOSED ON THE INCOME OF A PART-
 NERSHIP OR S CORPORATION OF WHICH THE RESIDENT IS A PARTNER,  MEMBER  OR
 SHAREHOLDER  FOR THE TAXABLE YEAR BY ANOTHER STATE OF THE UNITED STATES,
 A POLITICAL SUBDIVISION OF SUCH STATE, OR THE DISTRICT OF COLUMBIA  UPON
 INCOME BOTH DERIVED THEREFROM AND SUBJECT TO TAX UNDER THIS ARTICLE.
   (2) SUCH CREDIT SHALL BE EQUAL TO THE PRODUCT OF:
   (A)  THE  TAXPAYER'S  PROFIT PERCENTAGE OF THE ELECTING PARTNERSHIP OR
 PRO RATA SHARE OF THE ELECTING S CORPORATION;
   (B) NINETY-TWO PERCENT; AND
   (C) THE PASS-THROUGH ENTITY TAX PAID BY THE ELECTING PARTNERSHIP OR  S
 CORPORATION  TO  SUCH  OTHER  STATE, POLITICAL SUBDIVISION OF SUCH OTHER
 STATE OR THE DISTRICT OF COLUMBIA.
   (3) HOWEVER, SUCH CREDIT WILL BE ALLOWED ON TAX PAID ONLY IF:
   (A) THE STATE OF THE UNITED  STATES,  POLITICAL  SUBDIVISION  OF  SUCH
 STATE,  OR  THE  DISTRICT  OF COLUMBIA IMPOSING SUCH TAX ALSO IMPOSES AN
 INCOME TAX SUBSTANTIALLY SIMILAR TO THE TAX IMPOSED UNDER THIS  ARTICLE;
 AND
   (B)  IN THE CASE OF TAXES PAID BY AN S CORPORATION, SUCH S CORPORATION
 WAS TREATED AS A NEW YORK S CORPORATION.
   (C) Limitations.  (1) The credit under this section shall  not  exceed
 the percentage of the tax otherwise due under this article determined by
 dividing  the portion of the taxpayer's New York income subject to taxa-
 tion by such other jurisdiction by the total amount  of  the  taxpayer's
 New York income.
   (2)  The  credit under this section shall not reduce the tax otherwise
 due under this article to an amount less than would have been due if the
 income subject to taxation by such other jurisdiction were excluded from
 the taxpayer's New York income.
   (3) In the case of a taxpayer who elects  to  claim  the  foreign  tax
 credit  for  federal  income tax purposes, the credit under this section
 for income tax imposed by a province of Canada shall be allowed for that
 portion of the provincial tax not claimed for federal purposes  for  the
 taxable  year  or  a  preceding  taxable  year, provided however, to the
 extent the provincial tax is claimed for federal purposes for a succeed-

 A. 4663--A                          8
 
 ing taxable year, the credit under this section must be  added  back  in
 such  succeeding  taxable year. The provincial tax shall be deemed to be
 claimed last for federal income tax purposes and for  purposes  of  this
 subsection.
   [(c)]  (D)  Definition.  For  purposes of this section New York income
 means:
   (1) the New York adjusted gross income of an individual, or
   (2) the amount of the income of an estate or trust, determined  as  if
 the  estate  or trust were an individual computing his New York adjusted
 gross income under section six hundred twelve.
   [(d) S corporation shareholders. In the case of a shareholder of an  S
 corporation,  the  term  "income  tax" in subsection (a) of this section
 shall not include any such tax imposed upon or  payable  by  the  corpo-
 ration, but shall include any such tax with respect to the income of the
 corporation  imposed  upon or payable by the shareholder, without regard
 to whether an  election  independent  of  the  federal  S  election  was
 required to effect such imposition upon the shareholder.]
   §  4.  Subdivision  1  of  section 171-a of the tax law, as amended by
 section 3 of part XX of chapter 59 of the laws of 2019,  is  amended  to
 read as follows:
   1.  All  taxes,  interest, penalties and fees collected or received by
 the commissioner or the commissioner's duly authorized agent under arti-
 cles nine (except section one hundred eighty-two-a thereof and except as
 otherwise  provided  in  section  two  hundred  five  thereof),  nine-A,
 twelve-A  (except  as  otherwise provided in section two hundred eighty-
 four-d thereof), thirteen, thirteen-A (except as otherwise  provided  in
 section  three  hundred  twelve  thereof),  eighteen,  nineteen,  twenty
 (except as otherwise provided in section four hundred eighty-two  there-
 of),  twenty-B,  twenty-D,  twenty-one, twenty-two, twenty-four, TWENTY-
 FOUR-A,  twenty-six,  twenty-eight  (except  as  otherwise  provided  in
 section   eleven   hundred   two   or  eleven  hundred  three  thereof),
 twenty-eight-A, twenty-nine-B, thirty-one (except as otherwise  provided
 in  section fourteen hundred twenty-one thereof), thirty-three and thir-
 ty-three-A of this chapter shall be deposited daily in one account  with
 such  responsible  banks,  banking  houses  or trust companies as may be
 designated by the comptroller, to the credit of the comptroller. Such an
 account may be established in one or more  of  such  depositories.  Such
 deposits  shall  be  kept separate and apart from all other money in the
 possession of the comptroller. The comptroller  shall  require  adequate
 security  from  all such depositories. Of the total revenue collected or
 received under such articles of  this  chapter,  the  comptroller  shall
 retain  in  the  comptroller's hands such amount as the commissioner may
 determine to be necessary for refunds or reimbursements under such arti-
 cles of this chapter out of which amount the comptroller shall  pay  any
 refunds or reimbursements to which taxpayers shall be entitled under the
 provisions  of  such  articles of this chapter. The commissioner and the
 comptroller shall maintain a system of accounts showing  the  amount  of
 revenue  collected  or  received  from each of the taxes imposed by such
 articles. The comptroller,  after  reserving  the  amount  to  pay  such
 refunds  or  reimbursements,  shall,  on or before the tenth day of each
 month, pay into the state treasury to the credit of the general fund all
 revenue deposited under this section during the preceding calendar month
 and remaining to the comptroller's  credit  on  the  last  day  of  such
 preceding  month, (i) except that the comptroller shall pay to the state
 department of social services that amount of overpayments of tax imposed
 by article twenty-two of this chapter and the interest  on  such  amount

 A. 4663--A                          9
 
 which  is certified to the comptroller by the commissioner as the amount
 to be credited against past-due support pursuant to subdivision  six  of
 section  one hundred seventy-one-c of this article, (ii) and except that
 the  comptroller  shall  pay  to  the  New  York  state higher education
 services corporation and the state university of New York  or  the  city
 university  of  New York respectively that amount of overpayments of tax
 imposed by article twenty-two of this chapter and the interest  on  such
 amount  which is certified to the comptroller by the commissioner as the
 amount to be credited against the amount of  defaults  in  repayment  of
 guaranteed  student  loans and state university loans or city university
 loans pursuant to subdivision five of section one hundred  seventy-one-d
 and  subdivision  six of section one hundred seventy-one-e of this arti-
 cle, (iii) and except further that, notwithstanding any law,  the  comp-
 troller  shall  credit  to  the  revenue  arrearage account, pursuant to
 section ninety-one-a of the state finance law, that amount  of  overpay-
 ment  of  tax imposed by article nine, nine-A, twenty-two, thirty, thir-
 ty-A, thirty-B or thirty-three of this chapter, and any interest  there-
 on,  which  is  certified  to the comptroller by the commissioner as the
 amount to be credited against a past-due legally enforceable  debt  owed
 to  a  state  agency  pursuant  to  paragraph  (a) of subdivision six of
 section one hundred seventy-one-f of this article, provided, however, he
 shall credit to  the  special  offset  fiduciary  account,  pursuant  to
 section  ninety-one-c of the state finance law, any such amount credita-
 ble as a liability as set forth in paragraph (b) of subdivision  six  of
 section  one  hundred  seventy-one-f  of  this  article, (iv) and except
 further that the comptroller shall pay to the  city  of  New  York  that
 amount  of  overpayment  of tax imposed by article nine, nine-A, twenty-
 two, thirty, thirty-A, thirty-B or thirty-three of this chapter and  any
 interest thereon that is certified to the comptroller by the commission-
 er  as  the  amount  to be credited against city of New York tax warrant
 judgment debt pursuant to section  one  hundred  seventy-one-l  of  this
 article,  (v)  and  except  further  that the comptroller shall pay to a
 non-obligated spouse that amount of overpayment of tax imposed by  arti-
 cle twenty-two of this chapter and the interest on such amount which has
 been credited pursuant to section one hundred seventy-one-c, one hundred
 seventy-one-d,  one  hundred seventy-one-e, one hundred seventy-one-f or
 one hundred seventy-one-l of this article and which is certified to  the
 comptroller  by  the  commissioner  as the amount due such non-obligated
 spouse pursuant to paragraph  six  of  subsection  (b)  of  section  six
 hundred fifty-one of this chapter; and (vi) the comptroller shall deduct
 a  like  amount which the comptroller shall pay into the treasury to the
 credit of the general fund from  amounts  subsequently  payable  to  the
 department  of  social  services,  the state university of New York, the
 city university of New York, or the  higher  education  services  corpo-
 ration,  or  the  revenue  arrearage account or special offset fiduciary
 account pursuant to section ninety-one-a or ninety-one-c  of  the  state
 finance  law, as the case may be, whichever had been credited the amount
 originally withheld from such overpayment, and  (vii)  with  respect  to
 amounts  originally  withheld  from such overpayment pursuant to section
 one hundred seventy-one-l of this article and paid to the  city  of  New
 York,  the  comptroller shall collect a like amount from the city of New
 York.
   § 5. Subdivision 1 of section 171-a of the  tax  law,  as  amended  by
 section  4  of  part XX of chapter 59 of the laws of 2019, is amended to
 read as follows:

 A. 4663--A                         10

   1. All taxes, interest, penalties and fees collected  or  received  by
 the commissioner or the commissioner's duly authorized agent under arti-
 cles nine (except section one hundred eighty-two-a thereof and except as
 otherwise  provided  in  section  two  hundred  five  thereof),  nine-A,
 twelve-A  (except  as  otherwise provided in section two hundred eighty-
 four-d thereof), thirteen, thirteen-A (except as otherwise  provided  in
 section  three  hundred  twelve  thereof),  eighteen,  nineteen,  twenty
 (except as otherwise provided in section four hundred eighty-two  there-
 of), twenty-D, twenty-one, twenty-two, twenty-four, TWENTY-FOUR-A, twen-
 ty-six,  twenty-eight  (except  as  otherwise provided in section eleven
 hundred two or eleven hundred three  thereof),  twenty-eight-A,  twenty-
 nine-B,  thirty-one  (except  as  otherwise provided in section fourteen
 hundred twenty-one thereof), thirty-three  and  thirty-three-A  of  this
 chapter  shall  be  deposited daily in one account with such responsible
 banks, banking houses or trust companies as may  be  designated  by  the
 comptroller,  to  the  credit of the comptroller. Such an account may be
 established in one or more of such depositories. Such deposits shall  be
 kept  separate  and  apart from all other money in the possession of the
 comptroller. The comptroller shall require adequate  security  from  all
 such depositories. Of the total revenue collected or received under such
 articles  of  this  chapter,  the  comptroller shall retain in the comp-
 troller's hands such amount as the  commissioner  may  determine  to  be
 necessary  for  refunds  or  reimbursements  under such articles of this
 chapter out of which amount the comptroller shall  pay  any  refunds  or
 reimbursements to which taxpayers shall be entitled under the provisions
 of  such  articles of this chapter. The commissioner and the comptroller
 shall maintain a system  of  accounts  showing  the  amount  of  revenue
 collected  or  received from each of the taxes imposed by such articles.
 The comptroller, after reserving the  amount  to  pay  such  refunds  or
 reimbursements,  shall,  on  or  before the tenth day of each month, pay
 into the state treasury to the credit of the general  fund  all  revenue
 deposited  under  this  section  during the preceding calendar month and
 remaining to the comptroller's credit on the last day of such  preceding
 month, (i) except that the comptroller shall pay to the state department
 of social services that amount of overpayments of tax imposed by article
 twenty-two  of  this  chapter  and  the interest on such amount which is
 certified to the comptroller by the commissioner as  the  amount  to  be
 credited against past-due support pursuant to subdivision six of section
 one  hundred  seventy-one-c  of  this  article, (ii) and except that the
 comptroller shall pay to the New York state  higher  education  services
 corporation  and the state university of New York or the city university
 of New York respectively that amount of overpayments of tax  imposed  by
 article twenty-two of this chapter and the interest on such amount which
 is  certified to the comptroller by the commissioner as the amount to be
 credited against the amount  of  defaults  in  repayment  of  guaranteed
 student loans and state university loans or city university loans pursu-
 ant  to subdivision five of section one hundred seventy-one-d and subdi-
 vision six of section one hundred seventy-one-e of this  article,  (iii)
 and  except further that, notwithstanding any law, the comptroller shall
 credit  to  the  revenue  arrearage   account,   pursuant   to   section
 ninety-one-a of the state finance law, that amount of overpayment of tax
 imposed  by article nine, nine-A, twenty-two, thirty, thirty-A, thirty-B
 or thirty-three of this chapter, and  any  interest  thereon,  which  is
 certified  to  the  comptroller  by the commissioner as the amount to be
 credited against a past-due legally enforceable debt  owed  to  a  state
 agency  pursuant  to  paragraph  (a)  of  subdivision six of section one

 A. 4663--A                         11
 
 hundred seventy-one-f of this article, provided, however, he shall cred-
 it to the special offset fiduciary account, pursuant to section  ninety-
 one-c  of the state finance law, any such amount creditable as a liabil-
 ity  as  set  forth  in  paragraph (b) of subdivision six of section one
 hundred seventy-one-f of this article, (iv) and except further that  the
 comptroller shall pay to the city of New York that amount of overpayment
 of  tax  imposed  by article nine, nine-A, twenty-two, thirty, thirty-A,
 thirty-B or thirty-three of this chapter and any interest  thereon  that
 is  certified to the comptroller by the commissioner as the amount to be
 credited against city of New York tax warrant judgment debt pursuant  to
 section  one  hundred  seventy-one-l  of  this  article,  (v) and except
 further that the comptroller shall pay to a  non-obligated  spouse  that
 amount of overpayment of tax imposed by article twenty-two of this chap-
 ter  and the interest on such amount which has been credited pursuant to
 section  one  hundred  seventy-one-c,  one  hundred  seventy-one-d,  one
 hundred  seventy-one-e,  one hundred seventy-one-f or one hundred seven-
 ty-one-l of this article and which is certified to  the  comptroller  by
 the commissioner as the amount due such non-obligated spouse pursuant to
 paragraph six of subsection (b) of section six hundred fifty-one of this
 chapter;  and  (vi) the comptroller shall deduct a like amount which the
 comptroller shall pay into the treasury to the  credit  of  the  general
 fund  from  amounts  subsequently  payable  to  the department of social
 services, the state university of New York, the city university  of  New
 York,  or  the  higher  education  services  corporation, or the revenue
 arrearage account  or  special  offset  fiduciary  account  pursuant  to
 section  ninety-one-a  or  ninety-one-c of the state finance law, as the
 case may be, whichever had been credited the amount originally  withheld
 from  such  overpayment,  and  (vii)  with respect to amounts originally
 withheld from such overpayment pursuant to section one hundred  seventy-
 one-l  of this article and paid to the city of New York, the comptroller
 shall collect a like amount from the city of New York.
   § 6. Subdivisions 2, 3 and paragraph (a) of subdivision 5  of  section
 92-z  of  the  state  finance law, as amended by section 5 of part MM of
 chapter 59 of the laws of 2018, are amended to read as follows:
   2. Such fund shall consist of (a) fifty percent of receipts  from  the
 imposition  of  personal  income taxes pursuant to article twenty-two of
 the tax law, less such amounts  as  the  commissioner  of  taxation  and
 finance  may  determine  to  be  necessary  for refunds, [and] (b) fifty
 percent of receipts from the imposition of employer compensation expense
 taxes pursuant to article twenty-four of the tax law, less such  amounts
 as  the  commissioner of taxation and finance may determine to be neces-
 sary for refunds, AND (C) FIFTY PERCENT OF RECEIPTS FROM THE  IMPOSITION
 OF  THE  PASS-THROUGH  ENTITY TAXES PURSUANT TO ARTICLE TWENTY-FOUR-A OF
 THE TAX LAW, LESS SUCH AMOUNTS AS THE COMMISSION OF TAXATION AND FINANCE
 MAY DETERMINE TO BE NECESSARY FOR REFUNDS.
   3. (a) Beginning on the first day of each month, the comptroller shall
 deposit all of the receipts collected pursuant to  section  six  hundred
 seventy-one of the tax law in the revenue bond tax fund until the amount
 of  monthly receipts anticipated to be deposited pursuant to the certif-
 icate required in paragraph (b) of subdivision five of this section  are
 met.  On  or  before  the twelfth day of each month, the commissioner of
 taxation and finance shall certify to the state comptroller the  amounts
 specified  in  paragraph (a) of subdivision two of this section relating
 to the preceding month and, in addition, no  later  than  March  thirty-
 first of each fiscal year the commissioner of taxation and finance shall
 certify such amounts relating to the last month of such fiscal year. The

 A. 4663--A                         12
 
 amounts  so certified shall be deposited by the state comptroller in the
 revenue bond tax fund.
   (b)  Beginning  on  the first day of each month, the comptroller shall
 deposit all of the receipts collected pursuant to section eight  hundred
 fifty-four  of the tax law in the revenue bond tax fund until the amount
 of monthly receipts anticipated to be deposited pursuant to the  certif-
 icate  required in paragraph (b) of subdivision five of this section are
 met. On or before the twelfth day of each  month,  the  commissioner  of
 taxation  and finance shall certify to the state comptroller the amounts
 specified in paragraph (b) of subdivision two of this  section  relating
 to  the  preceding  month  and, in addition, no later than March thirty-
 first of each fiscal year the commissioner of taxation and finance shall
 certify such amounts relating to the last month of such fiscal year. The
 amounts so certified shall be deposited by the state comptroller in  the
 revenue bond tax fund.
   (C)  BEGINNING  ON  THE FIRST DAY OF EACH MONTH, THE COMPTROLLER SHALL
 DEPOSIT ALL OF THE RECEIPTS COLLECTED PURSUANT TO SECTIONS EIGHT HUNDRED
 SIXTY-FOUR AND EIGHT HUNDRED SIXTY-FIVE OF THE TAX LAW  IN  THE  REVENUE
 BOND  TAX  FUND  UNTIL  THE AMOUNT OF MONTHLY RECEIPTS ANTICIPATED TO BE
 DEPOSITED PURSUANT TO THE  CERTIFICATE  REQUIRED  IN  PARAGRAPH  (B)  OF
 SUBDIVISION  FIVE  OF THIS SECTION ARE MET. ON OR BEFORE THE TWELFTH DAY
 OF EACH MONTH, THE COMMISSIONER OF TAXATION AND FINANCE SHALL CERTIFY TO
 THE STATE COMPTROLLER THE AMOUNTS SPECIFIED IN PARAGRAPH (C) OF SUBDIVI-
 SION TWO OF THIS SECTION RELATING TO THE PRECEDING MONTH AND,  IN  ADDI-
 TION,  NO  LATER THAN MARCH THIRTY-FIRST OF EACH FISCAL YEAR THE COMMIS-
 SIONER OF TAXATION AND FINANCE SHALL CERTIFY SUCH  AMOUNTS  RELATING  TO
 THE  LAST  MONTH  OF SUCH FISCAL YEAR. THE AMOUNTS SO CERTIFIED SHALL BE
 DEPOSITED BY THE STATE COMPTROLLER IN THE REVENUE BOND TAX FUND.
   (a) The state comptroller shall from time to time,  but  in  no  event
 later than the fifteenth day of each month (other than the last month of
 the  fiscal  year)  and  no  later than the thirty-first day of the last
 month of each fiscal year, pay over and distribute to the credit of  the
 general  fund  of  the state treasury all moneys in the revenue bond tax
 fund, if any, in excess of the aggregate amount required to be set aside
 for the payment of cash requirements pursuant to paragraph (b)  of  this
 subdivision,  provided  that  an  appropriation has been made to pay all
 amounts specified in any certificate or certificates  delivered  by  the
 director  of the budget pursuant to paragraph (b) of this subdivision as
 being required by each authorized issuer as  such  term  is  defined  in
 section  sixty-eight-a  of this chapter for the payment of cash require-
 ments of such issuers for such fiscal year. Subject  to  the  rights  of
 holders  of  debt  of the state, in no event shall the state comptroller
 pay over and distribute any moneys on deposit in the  revenue  bond  tax
 fund  to  any  person  other  than an authorized issuer pursuant to such
 certificate or certificates (i) unless and until the  aggregate  of  all
 cash requirements certified to the state comptroller as required by such
 authorized  issuers  to  be  set aside pursuant to paragraph (b) of this
 subdivision for such fiscal year shall have been  appropriated  to  such
 authorized  issuers  in  accordance  with  the schedule specified in the
 certificate or certificates filed by the director of the budget or  (ii)
 if,  after  having  been  so  certified  and  appropriated,  any payment
 required to be made pursuant to paragraph (b) of  this  subdivision  has
 not  been made to the authorized issuers which was required to have been
 made pursuant to such certificate or  certificates;  provided,  however,
 that  no  person,  including  such  authorized issuers or the holders of
 revenue bonds, shall have any lien on moneys on deposit in  the  revenue

 A. 4663--A                         13
 
 bond  tax  fund.  Any  agreement entered into pursuant to section sixty-
 eight-c of this chapter  related  to  any  payment  authorized  by  this
 section shall be executory only to the extent of such revenues available
 to the state in such fund. Notwithstanding subdivisions two and three of
 this section, in the event the aggregate of all cash requirements certi-
 fied  to the state comptroller as required by such authorized issuers to
 be set aside pursuant to paragraph  (b)  of  this  subdivision  for  the
 fiscal year beginning on April first shall not have been appropriated to
 such authorized issuers in accordance with the schedule specified in the
 certificate or certificates filed by the director of the budget or, (ii)
 if,  having  been so certified and appropriated, any payment required to
 be made pursuant to paragraph (b) of this subdivision has not been  made
 pursuant  to  such  certificate  or certificates, all receipts collected
 pursuant to section six  hundred  seventy-one  of  the  tax  law,  [and]
 section  eight  hundred fifty-four of the tax law, SECTION EIGHT HUNDRED
 SIXTY-FOUR OF THE TAX LAW, AND SECTION EIGHT HUNDRED SIXTY-FIVE  OF  THE
 TAX LAW shall be deposited in the revenue bond tax fund until the great-
 er of forty percent of the aggregate of the receipts from the imposition
 of  (A) the personal income tax imposed by article twenty-two of the tax
 law, [and] (B) the employer compensation expense tax imposed by  article
 twenty-four  of the tax law, AND (C) THE PASS-THROUGH ENTITY TAX IMPOSED
 BY ARTICLE TWENTY-FOUR-A OF THE TAX LAW for the fiscal year beginning on
 April first and as specified in the certificate or certificates filed by
 the director of the budget pursuant to this  paragraph  or  a  total  of
 twelve  billion dollars has been deposited in the revenue bond tax fund.
 Notwithstanding any other provision of law, if the state  has  appropri-
 ated  and  paid  to the authorized issuers the amounts necessary for the
 authorized issuers to meet their requirements  for  the  current  fiscal
 year pursuant to the certificate or certificates submitted by the direc-
 tor  of  the budget pursuant to paragraph (b) of this section, the state
 comptroller shall, on the last day of  each  fiscal  year,  pay  to  the
 general  fund  of  the  state all sums remaining in the revenue bond tax
 fund on such date except such amounts as the director of the budget  may
 certify  are  needed to meet the cash requirements of authorized issuers
 during the subsequent fiscal year.
   § 7. Subdivision 5 of section  68-c  of  the  state  finance  law,  as
 amended  by  section  6 of part MM of chapter 59 of the laws of 2018, is
 amended to read as follows:
   5. Nothing contained in this article shall be deemed to  restrict  the
 right  of the state to amend, repeal, modify or otherwise alter statutes
 imposing  or  relating  to  the  taxes  imposed  pursuant   to   article
 twenty-two,  [and] article twenty-four, AND ARTICLE TWENTY-FOUR-A of the
 tax law. The authorized issuers shall not include within any resolution,
 contract or agreement with holders of the  revenue  bonds  issued  under
 this  article  any  provision  which provides that a default occurs as a
 result of the state exercising its right to  amend,  repeal,  modify  or
 otherwise  alter the taxes imposed pursuant to article twenty-two, [and]
 article twenty-four, AND ARTICLE TWENTY-FOUR-A of the tax law.
   § 8. This act shall take effect immediately and  shall  apply  to  all
 taxable  years beginning on or after January 1, 2022; provided, however,
 that the amendments to subdivision 1 of section 171-a  of  the  tax  law
 made by section four of this act shall not affect the expiration of such
 subdivision  and  shall  expire  therewith,  when  upon  such  date  the
 provisions of section five of this act shall take effect.

                            
 
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                  4663--B
 
                        2021-2022 Regular Sessions
 
                           I N  A S S E M B L Y
 
                             February 4, 2021
                                ___________
 
 Introduced by M. of A. PAULIN -- read once and referred to the Committee
   on  Ways  and  Means  --  committee  discharged, bill amended, ordered
   reprinted as amended  and  recommitted  to  said  committee  --  again
   reported  from  said  committee  with amendments, ordered reprinted as
   amended and recommitted to said committee

 AN ACT to amend the tax law and the state finance law,  in  relation  to
   the imposition of a pass-through entity tax
 
   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 article 24-A to read
 as follows:
                               ARTICLE 24-A
                          PASS-THROUGH ENTITY TAX
 SECTION 860. DEFINITIONS.
         861. PASS-THROUGH ENTITY TAX ELECTION.
         862. IMPOSITION AND RATE OF TAX.
         863. PASS-THROUGH ENTITY TAX CREDIT.
         864. PAYMENT OF ESTIMATED TAX.
         865. FILING OF RETURN AND PAYMENT OF TAX.
         866. ACCOUNTING PERIODS AND METHODS.
         867. PROCEDURAL PROVISIONS.
   § 860. DEFINITIONS. FOR PURPOSES OF THIS ARTICLE:
   (A) ELIGIBLE PARTNERSHIP.  ELIGIBLE PARTNERSHIP MEANS ANY  PARTNERSHIP
 AS  PROVIDED FOR IN SECTION 7701(A)(2) OF THE INTERNAL REVENUE CODE THAT
 CONSISTS SOLELY OF PARTNERS WHO ARE INDIVIDUALS.   AN ELIGIBLE  PARTNER-
 SHIP INCLUDES ANY LIMITED LIABILITY COMPANY TREATED AS A PARTNERSHIP FOR
 FEDERAL  INCOME  TAX  PURPOSES  THAT OTHERWISE MEETS THE REQUIREMENTS OF
 THIS SUBDIVISION.
   (B) ELIGIBLE S CORPORATION.  ELIGIBLE S CORPORATION MEANS ANY NEW YORK
 S CORPORATION AS DEFINED PURSUANT TO THIS CHAPTER THAT  CONSISTS  SOLELY
 OF  SHAREHOLDERS WHO ARE INDIVIDUALS. AN ELIGIBLE S CORPORATION INCLUDES
 ANY LIMITED LIABILITY COMPANY TREATED AS AN S  CORPORATION  FOR  FEDERAL
 INCOME TAX PURPOSES THAT OTHERWISE MEETS THE REQUIREMENTS OF THIS SUBDI-
 VISION.
              

 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
                                                            LBD08173-03-1

 A. 4663--B                          2
 
   (C)  ELECTING  PARTNERSHIP.    ELECTING PARTNERSHIP MEANS ANY ELIGIBLE
 PARTNERSHIP THAT MADE A VALID, TIMELY ELECTION PURSUANT TO SECTION EIGHT
 HUNDRED SIXTY-ONE OF THIS ARTICLE.
   (D) ELECTING S CORPORATION.  ELECTING S CORPORATION MEANS ANY ELIGIBLE
 S  CORPORATION  THAT  MADE  A VALID, TIMELY ELECTION PURSUANT TO SECTION
 EIGHT HUNDRED SIXTY-ONE OF THIS ARTICLE.
   (E) TAXPAYER. TAXPAYER MEANS ANY ELECTING PARTNERSHIP  OR  ELECTING  S
 CORPORATION.
   (F)  PASS-THROUGH ENTITY TAX.  PASS-THROUGH ENTITY TAX MEANS THE TOTAL
 TAX IMPOSED BY THIS ARTICLE ON  ELECTING  PARTNERSHIPS  AND  ELECTING  S
 CORPORATIONS.
   (G)  PASS-THROUGH  ADJUSTED  NET  INCOME (NOT LESS THAN ZERO).   PASS-
 THROUGH ADJUSTED NET INCOME (NOT LESS THAN ZERO) MEANS:
   (1) IN THE CASE OF AN ELECTING PARTNERSHIP, THE  SUM  OF  (I)  FEDERAL
 TAXABLE  INCOME  (NOT LESS THAN ZERO), AS DESCRIBED IN SECTION 702(A)(8)
 OF THE INTERNAL REVENUE CODE, TO THE  EXTENT  EARNED  DIRECTLY  BY  SUCH
 PARTNERSHIP;  (II) TAXES PAID OR INCURRED DURING THE TAXABLE YEAR PURSU-
 ANT TO THIS ARTICLE BY A PARTNERSHIP TO THE EXTENT DEDUCTED IN COMPUTING
 FEDERAL TAXABLE INCOME; (III) TAXES SUBSTANTIALLY  SIMILAR  TO  THE  TAX
 IMPOSED  PURSUANT  TO  THIS  ARTICLE PAID OR INCURRED DURING THE TAXABLE
 YEAR TO ANOTHER STATE OF THE UNITED STATES, A POLITICAL  SUBDIVISION  OF
 SUCH  STATE,  OR  THE  DISTRICT  OF  COLUMBIA  TO THE EXTENT DEDUCTED IN
 COMPUTING FEDERAL TAXABLE INCOME; AND (IV) GUARANTEED PAYMENTS  PAID  BY
 THE  PARTNERSHIP  TO  ITS PARTNERS AS DESCRIBED IN SECTION 707(C) OF THE
 INTERNAL REVENUE CODE.
   (2) IN THE CASE OF AN ELECTING S CORPORATION, THE SUM OF  (I)  FEDERAL
 NONSEPARATELY  COMPUTED  INCOME  (NOT  LESS  THAN ZERO), AS DESCRIBED IN
 SECTION 1366(A)(2) OF THE INTERNAL REVENUE CODE, WHETHER EARNED BY  SUCH
 S  CORPORATION OR BY A PARTNERSHIP OF WHICH THE S CORPORATION IS A PART-
 NER; (II) TAXES PAID OR INCURRED DURING THE  TAXABLE  YEAR  PURSUANT  TO
 THIS  ARTICLE  BY  AN  S CORPORATION TO THE EXTENT DEDUCTED IN COMPUTING
 FEDERAL ORDINARY INCOME; AND (III) TAXES SUBSTANTIALLY  SIMILAR  TO  THE
 TAX IMPOSED PURSUANT TO THIS ARTICLE PAID OR INCURRED DURING THE TAXABLE
 YEAR  TO  ANOTHER STATE OF THE UNITED STATES, A POLITICAL SUBDIVISION OF
 SUCH STATE, OR THE DISTRICT  OF  COLUMBIA  TO  THE  EXTENT  DEDUCTED  IN
 COMPUTING FEDERAL TAXABLE INCOME.
   (H)  PARTNERSHIP  TAXABLE  INCOME.    PARTNERSHIP TAXABLE INCOME OF AN
 ELECTING PARTNERSHIP MEANS THE SUM OF  (1)  THE  ELECTING  PARTNERSHIP'S
 PASS-THROUGH  ADJUSTED NET INCOME (NOT LESS THAN ZERO), ALLOCATED TO NEW
 YORK STATE PURSUANT TO SUBDIVISION (B) OF SECTION EIGHT  HUNDRED  SIXTY-
 TWO  OF  THIS  ARTICLE; AND (2) THE ELECTING PARTNERSHIP'S PROPORTIONATE
 SHARE OF ANY PASS-THROUGH ADJUSTED NET INCOME (NOT LESS THAN ZERO)  FROM
 A  PARTNERSHIP  OF WHICH IT IS A PARTNER TO THE EXTENT IT WAS SOURCED TO
 NEW YORK BY SUCH PARTNERSHIP PURSUANT TO THE PRINCIPLES OF ARTICLE TWEN-
 TY-TWO OF THIS CHAPTER.
   (I) S CORPORATION TAXABLE INCOME.  S CORPORATION TAXABLE INCOME OF  AN
 ELECTING  S  CORPORATION MEANS THE ELECTING S CORPORATION'S PASS-THROUGH
 ADJUSTED NET INCOME (NOT LESS THAN ZERO) ALLOCATED  TO  NEW  YORK  STATE
 PURSUANT  TO  SUBDIVISION (C) OF SECTION EIGHT HUNDRED SIXTY-TWO OF THIS
 ARTICLE.
   § 861. PASS-THROUGH ENTITY TAX ELECTION. (A) ANY ELIGIBLE  PARTNERSHIP
 OR  ELIGIBLE  S  CORPORATION  DOING  BUSINESS WITHIN THIS STATE SHALL BE
 ALLOWED TO MAKE AN ANNUAL ELECTION TO BE TAXED PURSUANT TO THIS ARTICLE.
   (B) IN ORDER TO BE EFFECTIVE, THE ANNUAL ELECTION MUST BE MADE (1)  IF
 THE  ENTITY  IS AN S CORPORATION, BY ANY OFFICER, MANAGER OR SHAREHOLDER
 OF THE S CORPORATION WHO IS AUTHORIZED UNDER THE LAW OF THE STATE  WHERE

 A. 4663--B                          3
 
 THE  CORPORATION  IS INCORPORATED OR UNDER THE S CORPORATION'S ORGANIZA-
 TIONAL DOCUMENTS TO MAKE THE ELECTION AND WHO REPRESENTS TO HAVING  SUCH
 AUTHORIZATION UNDER PENALTY OF PERJURY; OR (2) IF THE ENTITY IS NOT AN S
 CORPORATION,  BY  ANY  MEMBER,  PARTNER, OWNER, OR OTHER INDIVIDUAL WITH
 AUTHORITY TO BIND THE ENTITY OR SIGN RETURNS  PURSUANT  TO  SECTION  SIX
 HUNDRED FIFTY-THREE OF THIS CHAPTER.
   (C) IF THE ELIGIBLE PARTNERSHIP OR ELIGIBLE S CORPORATION REPORTS ON A
 CALENDAR  YEAR BASIS, THE ANNUAL ELECTION MUST BE MADE BY DECEMBER FIRST
 OF EACH CALENDAR YEAR AND WILL TAKE EFFECT FOR THE IMMEDIATELY  SUCCEED-
 ING  CALENDAR  YEAR.    IF AN ELECTION IS MADE AFTER DECEMBER FIRST OF A
 CALENDAR YEAR, IT WILL FIRST TAKE EFFECT IN THE SECOND SUCCEEDING CALEN-
 DAR YEAR.
   (D) IF THE ELIGIBLE PARTNERSHIP OR ELIGIBLE S CORPORATION REPORTS ON A
 FISCAL YEAR BASIS, THE ANNUAL ELECTION MUST BE MADE BY THE FIRST DAY  OF
 THE  LAST FULL MONTH PRIOR TO THE START OF THE FISCAL YEAR AND WILL TAKE
 EFFECT FOR THE IMMEDIATELY SUCCEEDING FISCAL YEAR.   IF AN  ELECTION  IS
 MADE AFTER SUCH DATE, IT WILL FIRST TAKE EFFECT IN THE SECOND SUCCEEDING
 FISCAL YEAR.
   (E)  (1)  TERMINATION OF ELECTION. AN ELECTION PURSUANT TO SUBDIVISION
 (A) OF THIS SECTION SHALL BE TERMINATED WHENEVER, AT ANY TIME DURING THE
 TAXABLE YEAR, THE TAXPAYER CEASES  TO  BE  AN  ELIGIBLE  PARTNERSHIP  OR
 ELIGIBLE S CORPORATION.
   (2)  EFFECTIVE  DATE OF TERMINATION. THE TERMINATION OF AN ELECTION IS
 EFFECTIVE IMMEDIATELY UPON THE TAXPAYER CEASING TO BE AN ELIGIBLE  PART-
 NERSHIP  OR  ELIGIBLE  S  CORPORATION AND NO TAX WILL BE DUE PURSUANT TO
 THIS ARTICLE FOR THE TAXABLE YEAR.
   (3) ABATEMENT OF PENALTIES.  IF A TERMINATION OCCURS PURSUANT TO  THIS
 SUBDIVISION SOLELY BECAUSE A PARTNER, MEMBER OR SHAREHOLDER OF AN OTHER-
 WISE  ELIGIBLE  PARTNERSHIP  OR  ELIGIBLE  S CORPORATION DIED DURING THE
 TAXABLE YEAR AND THE SUCCESSOR TO THE DECEDENT'S INTEREST IN  THE  PART-
 NERSHIP  OR  S CORPORATION IS NOT AN INDIVIDUAL, NO ADDITION TO TAX WILL
 BE IMPOSED PURSUANT TO SUBSECTION (C) OF SECTION SIX HUNDRED EIGHTY-FIVE
 OF THIS CHAPTER ON THE PARTNERS, MEMBERS AND SHAREHOLDERS OF SUCH  PART-
 NERSHIP  OR  S CORPORATION SOLELY FOR UNDERPAYMENT OF ESTIMATED PERSONAL
 INCOME TAX AS A RESULT OF THE TERMINATION OF THE ELECTION MADE  PURSUANT
 TO THIS ARTICLE.
   §  862.  IMPOSITION  AND  RATE  OF TAX. (A) GENERAL.   A TAX IS HEREBY
 IMPOSED FOR EACH TAXABLE YEAR ON THE PARTNERSHIP TAXABLE INCOME OF EVERY
 ELECTING PARTNERSHIP DOING BUSINESS WITHIN  THIS  STATE  AND  ON  THE  S
 CORPORATION  TAXABLE  INCOME OF EVERY ELECTING S CORPORATION DOING BUSI-
 NESS WITHIN THIS STATE. THIS TAX SHALL BE IN ADDITION TO ANY OTHER TAXES
 IMPOSED AND SHALL BE AT THE  RATE  OF  SIX  AND  EIGHTY-FIVE  HUNDREDTHS
 PERCENT  FOR  EACH TAXABLE YEAR BEGINNING ON OR AFTER JANUARY FIRST, TWO
 THOUSAND TWENTY-ONE.
   (B) ALLOCATION TO NEW YORK BY AN ELECTING PARTNERSHIP.  IN DETERMINING
 THE AMOUNT OF PARTNERSHIP TAXABLE INCOME, THE ADJUSTED NET INCOME OF THE
 ELECTING PARTNERSHIP SHALL BE ALLOCATED TO THIS STATE  PURSUANT  TO  THE
 PRINCIPLES OF ARTICLE TWENTY-TWO OF THIS CHAPTER.
   (C) ALLOCATION TO NEW YORK BY AN ELECTING S CORPORATION.  IN DETERMIN-
 ING  THE AMOUNT OF S CORPORATION TAXABLE INCOME, THE ADJUSTED NET INCOME
 OF THE ELECTING S CORPORATION SHALL BE ALLOCATED TO THIS STATE BY MULTI-
 PLYING THE ADJUSTED NET INCOME OF THE  ELECTING  S  CORPORATION  BY  THE
 BUSINESS  APPORTIONMENT  FACTOR  OF THE ELECTING S CORPORATION AS CALCU-
 LATED PURSUANT TO SECTION TWO HUNDRED TEN-A OF THIS CHAPTER.
   § 863. PASS-THROUGH ENTITY TAX CREDIT. AN INDIVIDUAL  SUBJECT  TO  TAX
 UNDER  ARTICLE TWENTY-TWO OF THIS CHAPTER THAT IS A PARTNER OR MEMBER IN

 A. 4663--B                          4
 
 AN ELECTING PARTNERSHIP OR A SHAREHOLDER OF AN  ELECTING  S  CORPORATION
 SUBJECT  TO TAX UNDER THIS ARTICLE SHALL BE ALLOWED A CREDIT AGAINST THE
 TAX IMPOSED PURSUANT TO ARTICLE TWENTY-TWO  OF  THIS  CHAPTER,  COMPUTED
 PURSUANT  TO  THE  PROVISIONS OF SUBSECTION (KKK) OF SECTION SIX HUNDRED
 SIX OF THIS CHAPTER.
   § 864. PAYMENT OF ESTIMATED TAX.  (A)  DEFINITION  OF  ESTIMATED  TAX.
 ESTIMATED  TAX MEANS THE AMOUNT THAT AN ELECTING PARTNERSHIP OR ELECTING
 S CORPORATION ESTIMATES TO BE THE TAX IMPOSED BY SECTION  EIGHT  HUNDRED
 SIXTY-TWO OF THIS ARTICLE FOR THE CURRENT TAXABLE YEAR.
   (B)  GENERAL. THE ESTIMATED TAX SHALL BE PAID AS FOLLOWS FOR AN ELECT-
 ING PARTNERSHIP AND AN ELECTING S CORPORATION THAT REPORTS ON A CALENDAR
 YEAR BASIS:
   (1) THE ESTIMATED TAX SHALL BE PAID  IN  FOUR  EQUAL  INSTALLMENTS  ON
 MARCH  FIFTEENTH,  JUNE  FIFTEENTH,  SEPTEMBER  FIFTEENTH  AND  DECEMBER
 FIFTEENTH.
   (2) THE AMOUNT  OF  ANY  REQUIRED  INSTALLMENT  SHALL  BE  TWENTY-FIVE
 PERCENT OF THE REQUIRED ANNUAL PAYMENT.
   (3)  THE  REQUIRED ANNUAL PAYMENT IS THE LESSER OF: (A) NINETY PERCENT
 OF THE TAX SHOWN ON THE RETURN FOR THE TAXABLE YEAR; OR (B) ONE  HUNDRED
 PERCENT  OF  THE  TAX SHOWN ON THE RETURN OF THE ELECTING PARTNERSHIP OR
 ELECTING S CORPORATION FOR THE PRECEDING TAXABLE YEAR.
   (C) APPLICATION TO SHORT TAXABLE YEAR.  THIS SECTION SHALL APPLY TO  A
 TAXABLE  YEAR  OF  LESS THAN TWELVE MONTHS IN ACCORDANCE WITH PROCEDURES
 ESTABLISHED BY THE COMMISSIONER.
   (D) FISCAL YEAR. THIS SECTION SHALL APPLY TO A TAXABLE YEAR OTHER THAN
 A CALENDAR YEAR BY THE SUBSTITUTION OF THE MONTHS OF  SUCH  FISCAL  YEAR
 FOR THE CORRESPONDING MONTHS SPECIFIED IN THIS SECTION.
   (E)  INSTALLMENTS PAID IN ADVANCE. AN ELECTING PARTNERSHIP OR ELECTING
 S CORPORATION MAY ELECT TO PAY ANY  INSTALLMENT  OF  ITS  ESTIMATED  TAX
 PRIOR TO THE DATE PRESCRIBED FOR THE PAYMENT THEREOF.
   §  865. FILING OF RETURN AND PAYMENT OF TAX. (A) GENERAL. ON OR BEFORE
 THE FIFTEENTH DAY OF THE THIRD MONTH FOLLOWING THE CLOSE OF THE  TAXABLE
 YEAR,  EACH  ELECTING  PARTNERSHIP  AND EACH ELECTING S CORPORATION MUST
 FILE A RETURN FOR THE TAXABLE YEAR REPORTING  THE  INFORMATION  REQUIRED
 PURSUANT TO THIS ARTICLE.
   (B)  CERTIFICATION  OF  ELIGIBILITY.    EVERY RETURN FILED PURSUANT TO
 SUBDIVISION (A) OF THIS SECTION SHALL INCLUDE, IN A FORMAT AS PRESCRIBED
 BY THE COMMISSIONER, A CERTIFICATION BY AN INDIVIDUAL AUTHORIZED TO  ACT
 ON BEHALF OF THE ELECTING PARTNERSHIP OR ELECTING S CORPORATION THAT THE
 TAXPAYER:
   (1)  MADE  A  TIMELY,  VALID ELECTION TO BE SUBJECT TO TAX PURSUANT TO
 THIS ARTICLE;
   (2) WAS AT ALL TIMES DURING THE TAXABLE YEAR ELIGIBLE TO MAKE SUCH  AN
 ELECTION,  UNLESS  SUCH RETURN INCLUDES A NOTIFICATION OF TERMINATION AS
 PROVIDED FOR IN SUBDIVISION (C) OF THIS SECTION; AND
   (3) THAT ALL STATEMENTS CONTAINED THEREIN ARE TRUE.
   (C) NOTIFICATION OF TERMINATION.  IF AN ELECTION IS TERMINATED  DURING
 THE  TAXABLE  YEAR  PURSUANT TO SUBDIVISION (E) OF SECTION EIGHT HUNDRED
 SIXTY-ONE OF THIS ARTICLE, THE ELECTING PARTNERSHIP OR ELECTING S CORPO-
 RATION IS REQUIRED TO FILE A RETURN PURSUANT TO SUBDIVISION (A) OF  THIS
 SECTION  NOTIFYING THE COMMISSIONER OF SUCH TERMINATION.  SUCH NOTIFICA-
 TION WILL BE CONSIDERED A CLAIM FOR A CREDIT OR REFUND OF AN OVERPAYMENT
 OF PASS-THROUGH ENTITY TAX OF ANY ESTIMATED PAYMENTS  MADE  PURSUANT  TO
 THIS ARTICLE FOR THE TAXABLE YEAR CONTAINING THE DATE OF TERMINATION.
   (D)  INFORMATION  ON  RETURN. EACH ELECTING PARTNERSHIP AND ELECTING S
 CORPORATION SHALL REPORT ON SUCH RETURN:

 A. 4663--B                          5

   (1) THE BALANCE OF ANY TAX SHOWN ON SUCH RETURN, NOT  PREVIOUSLY  PAID
 AS INSTALLMENTS OF ESTIMATED TAX, SHALL BE PAID WITH SUCH RETURN;
   (2) IDENTIFYING INFORMATION OF ALL PARTNERS, MEMBERS AND/OR SHAREHOLD-
 ERS ELIGIBLE TO RECEIVE A CREDIT PURSUANT TO SECTION EIGHT HUNDRED SIXTY
 THREE  AND SUCH PARTNER'S, MEMBER'S AND/OR SHAREHOLDER'S DISTRIBUTIVE OR
 PRO RATA SHARE OF THE PASS-THROUGH ENTITY TAX IMPOSED  ON  THE  ELECTING
 PARTNERSHIP OR S CORPORATION; AND
   (3) ANY OTHER INFORMATION AS REQUIRED BY THE COMMISSIONER.
   (E)  INFORMATION  PROVIDED  TO  PARTNERS.  EACH  ELECTING  PARTNERSHIP
 SUBJECT TO TAX UNDER THIS ARTICLE SHALL REPORT TO EACH PARTNER OR MEMBER
 ITS DISTRIBUTIVE SHARE OF:
   (1) THE PARTNERSHIP TAXABLE INCOME OF THE ELECTING PARTNERSHIP;
   (2) THE PASS-THROUGH ENTITY TAX IMPOSED ON THE  ELECTING  PARTNERSHIP;
 AND
   (3) ANY OTHER INFORMATION AS REQUIRED BY THE COMMISSIONER.
   (F)  INFORMATION PROVIDED TO SHAREHOLDERS. EACH ELECTING S CORPORATION
 SUBJECT TO TAX UNDER THIS ARTICLE SHALL REPORT TO EACH  SHAREHOLDER  ITS
 PRO RATA SHARE OF:
   (1) THE S CORPORATION TAXABLE INCOME OF THE ELECTING S CORPORATION;
   (2) THE PASS-THROUGH ENTITY TAX IMPOSED ON THE ELECTING S CORPORATION;
 AND
   (3) ANY OTHER INFORMATION AS REQUIRED BY THE COMMISSIONER.
   §  866.  ACCOUNTING  PERIODS  AND  METHODS. (A) ACCOUNTING PERIODS. AN
 ELECTING PARTNERSHIP'S OR ELECTING S CORPORATION'S TAXABLE YEAR PURSUANT
 TO THIS ARTICLE SHALL BE THE  SAME  AS  THE  ELECTING  PARTNERSHIP'S  OR
 ELECTING S CORPORATION'S TAXABLE YEAR FOR FEDERAL INCOME TAX PURPOSES.
   (B) ACCOUNTING METHODS. AN ELECTING PARTNERSHIP'S OR ELECTING S CORPO-
 RATION'S METHOD OF ACCOUNTING PURSUANT TO THIS ARTICLE SHALL BE THE SAME
 AS  THE  ELECTING  PARTNERSHIP'S  OR  ELECTING S CORPORATION'S METHOD OF
 ACCOUNTING FOR FEDERAL INCOME TAX PURPOSES.
   (C) CHANGE OF ACCOUNTING PERIOD OR METHOD. (1) IF AN ELECTING PARTNER-
 SHIP'S OR ELECTING S CORPORATION'S TAXABLE YEAR OR METHOD OF  ACCOUNTING
 IS  CHANGED  FOR FEDERAL INCOME TAX PURPOSES, THE TAXABLE YEAR OR METHOD
 OF ACCOUNTING FOR PURPOSES OF THIS ARTICLE SHALL BE SIMILARLY CHANGED.
   (2) IF AN ELECTING PARTNERSHIP'S OR ELECTING S CORPORATION'S METHOD OF
 ACCOUNTING IS CHANGED, ANY ADDITIONAL TAX THAT RESULTS FROM  ADJUSTMENTS
 DETERMINED  TO BE NECESSARY SOLELY BY REASON OF SUCH CHANGE SHALL NOT BE
 GREATER THAN IF SUCH ADJUSTMENTS WERE RATABLY ALLOCATED AND INCLUDED FOR
 THE TAXABLE YEAR OF THE CHANGE AND THE PRECEDING TAXABLE YEARS,  NOT  IN
 EXCESS  OF  TWO,  DURING  WHICH THE ENTITY USED THE METHOD OF ACCOUNTING
 FROM WHICH THE CHANGE IS MADE.
   § 867. PROCEDURAL PROVISIONS.  (A) GENERAL.  ALL PROVISIONS OF ARTICLE
 TWENTY-TWO OF THIS CHAPTER WILL APPLY TO THE PROVISIONS OF THIS  ARTICLE
 IN THE SAME MANNER AND WITH THE SAME FORCE AND EFFECT AS IF THE LANGUAGE
 OF ARTICLE TWENTY-TWO OF THIS CHAPTER HAD BEEN INCORPORATED IN FULL INTO
 THIS  ARTICLE  AND  HAD  BEEN  SPECIFICALLY  ADJUSTED  FOR AND EXPRESSLY
 REFERRED TO THE TAX IMPOSED BY THIS ARTICLE, EXCEPT TO THE  EXTENT  THAT
 ANY PROVISION IS EITHER INCONSISTENT WITH A PROVISION OF THIS ARTICLE OR
 IS NOT RELEVANT TO THIS ARTICLE. NOTWITHSTANDING THE PRECEDING SENTENCE,
 NO  CREDIT AGAINST TAX IN ARTICLE TWENTY-TWO OF THIS CHAPTER CAN BE USED
 TO OFFSET THE TAX DUE PURSUANT TO THIS ARTICLE.
   (B) CROSS ARTICLE FILINGS. NOTWITHSTANDING  ANY  OTHER  PROVISIONS  OF
 THIS ARTICLE:
   (1)  THE  COMMISSIONER  MAY REQUIRE THE FILING OF ONE RETURN WHICH, IN
 ADDITION TO THE RETURN PROVIDED FOR IN SECTION EIGHT HUNDRED  SIXTY-FIVE
 OF  THIS  ARTICLE,  MAY  ALSO  INCLUDE ANY OF THE RETURNS REQUIRED TO BE

 A. 4663--B                          6
 
 FILED BY A TAXPAYER PURSUANT TO THE  PROVISIONS  OF  SUBSECTION  (C)  OF
 SECTION SIX HUNDRED FIFTY-EIGHT OR ARTICLE NINE-A OF THIS CHAPTER.
   (2)  WHERE  SUCH RETURN IS REQUIRED, THE COMMISSIONER MAY ALSO REQUIRE
 THE PAYMENT WITH IT OF A SINGLE AMOUNT WHICH SHALL EQUAL  THE  TOTAL  OF
 THE  AMOUNTS  (TOTAL  TAXES LESS ANY CREDITS OR REFUNDS) THAT WOULD HAVE
 BEEN REQUIRED TO BE PAID WITH THE RETURNS PURSUANT TO THE PROVISIONS  OF
 THIS ARTICLE AND THE PROVISIONS OF ARTICLE TWENTY-TWO OF THIS CHAPTER OR
 THE  PROVISIONS OF ARTICLE NINE-A OF THIS CHAPTER, WHICHEVER IS APPLICA-
 BLE.
   (3) NOTWITHSTANDING ANY OTHER LAW TO THE  CONTRARY,  THE  COMMISSIONER
 MAY  REQUIRE  THAT ALL FORMS OR RETURNS PURSUANT TO THIS ARTICLE MUST BE
 FILED ELECTRONICALLY AND ALL PAYMENTS OF  TAX  MUST  BE  PAID  ELECTRON-
 ICALLY.
   (C)  LIABILITY  FOR TAX.  AN ELECTING PARTNERSHIP OR ELECTING S CORPO-
 RATION SHALL BE LIABLE FOR THE TAX DUE  PURSUANT  TO  THIS  ARTICLE.  IN
 ADDITION,  EVERY  INDIVIDUAL  ELIGIBLE  TO  CLAIM  A  CREDIT PURSUANT TO
 SUBSECTION (KKK) OF SECTION SIX HUNDRED SIX OF THIS CHAPTER  BECAUSE  HE
 OR SHE IS A PARTNER OR MEMBER IN AN ELECTING PARTNERSHIP OR A SHAREHOLD-
 ER  IN  AN  ELECTING S CORPORATION SHALL BE JOINTLY AND SEVERALLY LIABLE
 FOR THE TAX IMPOSED PURSUANT TO THIS ARTICLE ON SUCH  ELECTING  PARTNER-
 SHIP OR ELECTING S CORPORATION.
   (D)  DEPOSIT  AND DISPOSITION OF REVENUE.  ALL TAXES, INTEREST, PENAL-
 TIES, AND FEES COLLECTED OR RECEIVED BY  THE  COMMISSIONER  PURSUANT  TO
 THIS  ARTICLE  SHALL  BE  DEPOSITED  AND  DISPOSED  OF  PURSUANT  TO THE
 PROVISIONS OF SECTION ONE HUNDRED SEVENTY-ONE-A OF THIS CHAPTER.
   (E) SECRECY PROVISION. ALL THE PROVISIONS OF PARAGRAPHS ONE AND TWO OF
 SUBSECTION (E) OF SECTION SIX HUNDRED NINETY-SEVEN OF THIS CHAPTER  WILL
 APPLY  TO THE PROVISIONS OF THIS ARTICLE. NOTWITHSTANDING ANY PROVISIONS
 OF THIS CHAPTER TO THE CONTRARY, THE COMMISSIONER MAY DISCLOSE  INFORMA-
 TION  AND  RETURNS  REGARDING  THE  CALCULATION  AND  PAYMENT OF THE TAX
 IMPOSED BY THIS ARTICLE AND ANY CREDIT CALCULATED ON TAXES PAID PURSUANT
 TO THIS ARTICLE BY AN ELECTING PARTNERSHIP OR ELECTING S CORPORATION  TO
 A PARTNER, MEMBER OR SHAREHOLDER OF SUCH ENTITY.
   §  2. Section 606 of the tax law is amended by adding a new subsection
 (kkk) to read as follows:
   (KKK) CREDIT FOR PASS-THROUGH ENTITY TAX. (1) A  TAXPAYER  PARTNER  OR
 MEMBER  OF  AN  ELECTING  PARTNERSHIP  AND  A TAXPAYER SHAREHOLDER OF AN
 ELECTING S CORPORATION SUBJECT TO TAX  UNDER  ARTICLE  TWENTY-FOUR-A  OF
 THIS  CHAPTER  SHALL  BE ENTITLED TO A CREDIT AGAINST THE TAX IMPOSED BY
 THIS ARTICLE AS PROVIDED IN THIS  SUBSECTION.    FOR  PURPOSES  OF  THIS
 SUBSECTION,  THE TERMS "ELECTING PARTNERSHIP," "ELECTING S CORPORATION,"
 AND "PASS-THROUGH ENTITY TAX" SHALL HAVE THE SAME MEANINGS  AS  USED  IN
 ARTICLE TWENTY-FOUR-A OF THIS CHAPTER.
   (2) THE CREDIT SHALL BE EQUAL TO THE PRODUCT OF:
   (I)  THE  TAXPAYER'S  PROFIT PERCENTAGE OF THE ELECTING PARTNERSHIP OR
 PRO RATA SHARE OF THE ELECTING S CORPORATION;
   (II) NINETY-TWO PERCENT; AND
   (III) THE PASS-THROUGH ENTITY TAX PAID BY THE ELECTING PARTNERSHIP  OR
 S CORPORATION FOR THE TAXABLE YEAR.
   (3)  IF  A  TAXPAYER  IS  A PARTNER, MEMBER OR SHAREHOLDER IN MULTIPLE
 ELECTING PARTNERSHIPS AND/OR ELECTING  S  CORPORATIONS  SUBJECT  TO  TAX
 PURSUANT TO ARTICLE TWENTY-FOUR-A OF THIS CHAPTER, THE TAXPAYER'S CREDIT
 SHALL BE THE SUM OF SUCH CREDITS CALCULATED PURSUANT TO PARAGRAPH TWO OF
 THIS  SUBSECTION  WITH REGARD TO EACH ENTITY IN WHICH THE TAXPAYER HAS A
 DIRECT OWNERSHIP INTEREST.

 A. 4663--B                          7
 
   (4) IF THE AMOUNT OF THE CREDIT ALLOWABLE PURSUANT TO THIS  SUBSECTION
 FOR ANY TAXABLE YEAR EXCEEDS THE TAX DUE FOR SUCH YEAR PURSUANT  TO THIS
 ARTICLE,  THE  EXCESS SHALL BE TREATED AS AN OVERPAYMENT, TO BE CREDITED
 OR REFUNDED, WITHOUT INTEREST.
   §  3.  Section 620 of the tax law, as amended by chapter 2 of the laws
 of 1962, subsection (a) as amended and paragraph 3 of subsection (b)  as
 added by chapter 274 of the laws of 1987, and subsection (d) as added by
 chapter 166 of 1991, is amended to read as follows:
   § 620. Credit for income tax of another state. (a) General. A resident
 shall be allowed a credit against the tax otherwise due under this arti-
 cle  for  any income tax imposed ON SUCH INDIVIDUAL for the taxable year
 by another state of the United States, a political subdivision  of  such
 state,  the  District  of  Columbia or a province of Canada, upon income
 both derived therefrom and subject to tax under this article.  The  term
 "income  tax  imposed"  in  the  previous sentence shall not include the
 portion of such tax (determined in the manner provided  for  in  section
 six  hundred twenty-A) which is imposed upon the ordinary income portion
 (or part thereof) of a lump sum distribution which  is  subject  to  the
 separate tax imposed by section [six hundred one-C] SIX HUNDRED THREE.
   (b) PASS-THROUGH ENTITY TAXES. (1) A RESIDENT SHALL BE ALLOWED A CRED-
 IT  AGAINST THE TAX OTHERWISE DUE PURSUANT TO THIS ARTICLE FOR ANY PASS-
 THROUGH ENTITY TAX SUBSTANTIALLY SIMILAR TO THE TAX IMPOSED PURSUANT  TO
 ARTICLE  TWENTY-FOUR-A  OF THIS CHAPTER IMPOSED ON THE INCOME OF A PART-
 NERSHIP OR S CORPORATION OF WHICH THE RESIDENT IS A PARTNER,  MEMBER  OR
 SHAREHOLDER  FOR THE TAXABLE YEAR BY ANOTHER STATE OF THE UNITED STATES,
 A POLITICAL SUBDIVISION OF SUCH STATE, OR THE DISTRICT OF COLUMBIA  UPON
 INCOME BOTH DERIVED THEREFROM AND SUBJECT TO TAX UNDER THIS ARTICLE.
   (2) SUCH CREDIT SHALL BE EQUAL TO THE PRODUCT OF:
   (A)  THE  TAXPAYER'S  PROFIT PERCENTAGE OF THE ELECTING PARTNERSHIP OR
 PRO RATA SHARE OF THE ELECTING S CORPORATION;
   (B) NINETY-TWO PERCENT; AND
   (C) THE PASS-THROUGH ENTITY TAX PAID BY THE ELECTING PARTNERSHIP OR  S
 CORPORATION  TO  SUCH  OTHER  STATE, POLITICAL SUBDIVISION OF SUCH OTHER
 STATE OR THE DISTRICT OF COLUMBIA.
   (3) HOWEVER, SUCH CREDIT WILL BE ALLOWED ON TAX PAID ONLY IF:
   (A) THE STATE OF THE UNITED  STATES,  POLITICAL  SUBDIVISION  OF  SUCH
 STATE,  OR  THE  DISTRICT  OF COLUMBIA IMPOSING SUCH TAX ALSO IMPOSES AN
 INCOME TAX SUBSTANTIALLY SIMILAR TO THE TAX IMPOSED UNDER THIS  ARTICLE;
 AND
   (B)  IN THE CASE OF TAXES PAID BY AN S CORPORATION, SUCH S CORPORATION
 WAS TREATED AS A NEW YORK S CORPORATION.
   (C) Limitations.  (1) The credit under this section shall  not  exceed
 the percentage of the tax otherwise due under this article determined by
 dividing  the portion of the taxpayer's New York income subject to taxa-
 tion by such other jurisdiction by the total amount  of  the  taxpayer's
 New York income.
   (2)  The  credit under this section shall not reduce the tax otherwise
 due under this article to an amount less than would have been due if the
 income subject to taxation by such other jurisdiction were excluded from
 the taxpayer's New York income.
   (3) In the case of a taxpayer who elects  to  claim  the  foreign  tax
 credit  for  federal  income tax purposes, the credit under this section
 for income tax imposed by a province of Canada shall be allowed for that
 portion of the provincial tax not claimed for federal purposes  for  the
 taxable  year  or  a  preceding  taxable  year, provided however, to the
 extent the provincial tax is claimed for federal purposes for a succeed-

 A. 4663--B                          8
 
 ing taxable year, the credit under this section must be  added  back  in
 such  succeeding  taxable year. The provincial tax shall be deemed to be
 claimed last for federal income tax purposes and for  purposes  of  this
 subsection.
   [(c)]  (D)  Definition.  For  purposes of this section New York income
 means:
   (1) the New York adjusted gross income of an individual, or
   (2) the amount of the income of an estate or trust, determined  as  if
 the  estate  or trust were an individual computing his New York adjusted
 gross income under section six hundred twelve.
   [(d) S corporation shareholders. In the case of a shareholder of an  S
 corporation,  the  term  "income  tax" in subsection (a) of this section
 shall not include any such tax imposed upon or  payable  by  the  corpo-
 ration, but shall include any such tax with respect to the income of the
 corporation  imposed  upon or payable by the shareholder, without regard
 to whether an  election  independent  of  the  federal  S  election  was
 required to effect such imposition upon the shareholder.]
   §  4.  Subdivision  1  of  section 171-a of the tax law, as amended by
 section 3 of part XX of chapter 59 of the laws of 2019,  is  amended  to
 read as follows:
   1.  All  taxes,  interest, penalties and fees collected or received by
 the commissioner or the commissioner's duly authorized agent under arti-
 cles nine (except section one hundred eighty-two-a thereof and except as
 otherwise  provided  in  section  two  hundred  five  thereof),  nine-A,
 twelve-A  (except  as  otherwise provided in section two hundred eighty-
 four-d thereof), thirteen, thirteen-A (except as otherwise  provided  in
 section  three  hundred  twelve  thereof),  eighteen,  nineteen,  twenty
 (except as otherwise provided in section four hundred eighty-two  there-
 of),  twenty-B,  twenty-D,  twenty-one, twenty-two, twenty-four, TWENTY-
 FOUR-A,  twenty-six,  twenty-eight  (except  as  otherwise  provided  in
 section   eleven   hundred   two   or  eleven  hundred  three  thereof),
 twenty-eight-A, twenty-nine-B, thirty-one (except as otherwise  provided
 in  section fourteen hundred twenty-one thereof), thirty-three and thir-
 ty-three-A of this chapter shall be deposited daily in one account  with
 such  responsible  banks,  banking  houses  or trust companies as may be
 designated by the comptroller, to the credit of the comptroller. Such an
 account may be established in one or more  of  such  depositories.  Such
 deposits  shall  be  kept separate and apart from all other money in the
 possession of the comptroller. The comptroller  shall  require  adequate
 security  from  all such depositories. Of the total revenue collected or
 received under such articles of  this  chapter,  the  comptroller  shall
 retain  in  the  comptroller's hands such amount as the commissioner may
 determine to be necessary for refunds or reimbursements under such arti-
 cles of this chapter out of which amount the comptroller shall  pay  any
 refunds or reimbursements to which taxpayers shall be entitled under the
 provisions  of  such  articles of this chapter. The commissioner and the
 comptroller shall maintain a system of accounts showing  the  amount  of
 revenue  collected  or  received  from each of the taxes imposed by such
 articles. The comptroller,  after  reserving  the  amount  to  pay  such
 refunds  or  reimbursements,  shall,  on or before the tenth day of each
 month, pay into the state treasury to the credit of the general fund all
 revenue deposited under this section during the preceding calendar month
 and remaining to the comptroller's  credit  on  the  last  day  of  such
 preceding  month, (i) except that the comptroller shall pay to the state
 department of social services that amount of overpayments of tax imposed
 by article twenty-two of this chapter and the interest  on  such  amount

 A. 4663--B                          9
 
 which  is certified to the comptroller by the commissioner as the amount
 to be credited against past-due support pursuant to subdivision  six  of
 section  one hundred seventy-one-c of this article, (ii) and except that
 the  comptroller  shall  pay  to  the  New  York  state higher education
 services corporation and the state university of New York  or  the  city
 university  of  New York respectively that amount of overpayments of tax
 imposed by article twenty-two of this chapter and the interest  on  such
 amount  which is certified to the comptroller by the commissioner as the
 amount to be credited against the amount of  defaults  in  repayment  of
 guaranteed  student  loans and state university loans or city university
 loans pursuant to subdivision five of section one hundred  seventy-one-d
 and  subdivision  six of section one hundred seventy-one-e of this arti-
 cle, (iii) and except further that, notwithstanding any law,  the  comp-
 troller  shall  credit  to  the  revenue  arrearage account, pursuant to
 section ninety-one-a of the state finance law, that amount  of  overpay-
 ment  of  tax imposed by article nine, nine-A, twenty-two, thirty, thir-
 ty-A, thirty-B or thirty-three of this chapter, and any interest  there-
 on,  which  is  certified  to the comptroller by the commissioner as the
 amount to be credited against a past-due legally enforceable  debt  owed
 to  a  state  agency  pursuant  to  paragraph  (a) of subdivision six of
 section one hundred seventy-one-f of this article, provided, however, he
 shall credit to  the  special  offset  fiduciary  account,  pursuant  to
 section  ninety-one-c of the state finance law, any such amount credita-
 ble as a liability as set forth in paragraph (b) of subdivision  six  of
 section  one  hundred  seventy-one-f  of  this  article, (iv) and except
 further that the comptroller shall pay to the  city  of  New  York  that
 amount  of  overpayment  of tax imposed by article nine, nine-A, twenty-
 two, thirty, thirty-A, thirty-B or thirty-three of this chapter and  any
 interest thereon that is certified to the comptroller by the commission-
 er  as  the  amount  to be credited against city of New York tax warrant
 judgment debt pursuant to section  one  hundred  seventy-one-l  of  this
 article,  (v)  and  except  further  that the comptroller shall pay to a
 non-obligated spouse that amount of overpayment of tax imposed by  arti-
 cle twenty-two of this chapter and the interest on such amount which has
 been credited pursuant to section one hundred seventy-one-c, one hundred
 seventy-one-d,  one  hundred seventy-one-e, one hundred seventy-one-f or
 one hundred seventy-one-l of this article and which is certified to  the
 comptroller  by  the  commissioner  as the amount due such non-obligated
 spouse pursuant to paragraph  six  of  subsection  (b)  of  section  six
 hundred fifty-one of this chapter; and (vi) the comptroller shall deduct
 a  like  amount which the comptroller shall pay into the treasury to the
 credit of the general fund from  amounts  subsequently  payable  to  the
 department  of  social  services,  the state university of New York, the
 city university of New York, or the  higher  education  services  corpo-
 ration,  or  the  revenue  arrearage account or special offset fiduciary
 account pursuant to section ninety-one-a or ninety-one-c  of  the  state
 finance  law, as the case may be, whichever had been credited the amount
 originally withheld from such overpayment, and  (vii)  with  respect  to
 amounts  originally  withheld  from such overpayment pursuant to section
 one hundred seventy-one-l of this article and paid to the  city  of  New
 York,  the  comptroller shall collect a like amount from the city of New
 York.
   § 5. Subdivision 1 of section 171-a of the  tax  law,  as  amended  by
 section  4  of  part XX of chapter 59 of the laws of 2019, is amended to
 read as follows:

 A. 4663--B                         10
 
   1. All taxes, interest, penalties and fees collected  or  received  by
 the commissioner or the commissioner's duly authorized agent under arti-
 cles nine (except section one hundred eighty-two-a thereof and except as
 otherwise  provided  in  section  two  hundred  five  thereof),  nine-A,
 twelve-A  (except  as  otherwise provided in section two hundred eighty-
 four-d thereof), thirteen, thirteen-A (except as otherwise  provided  in
 section  three  hundred  twelve  thereof),  eighteen,  nineteen,  twenty
 (except as otherwise provided in section four hundred eighty-two  there-
 of), twenty-D, twenty-one, twenty-two, twenty-four, TWENTY-FOUR-A, twen-
 ty-six,  twenty-eight  (except  as  otherwise provided in section eleven
 hundred two or eleven hundred three  thereof),  twenty-eight-A,  twenty-
 nine-B,  thirty-one  (except  as  otherwise provided in section fourteen
 hundred twenty-one thereof), thirty-three  and  thirty-three-A  of  this
 chapter  shall  be  deposited daily in one account with such responsible
 banks, banking houses or trust companies as may  be  designated  by  the
 comptroller,  to  the  credit of the comptroller. Such an account may be
 established in one or more of such depositories. Such deposits shall  be
 kept  separate  and  apart from all other money in the possession of the
 comptroller. The comptroller shall require adequate  security  from  all
 such depositories. Of the total revenue collected or received under such
 articles  of  this  chapter,  the  comptroller shall retain in the comp-
 troller's hands such amount as the  commissioner  may  determine  to  be
 necessary  for  refunds  or  reimbursements  under such articles of this
 chapter out of which amount the comptroller shall  pay  any  refunds  or
 reimbursements to which taxpayers shall be entitled under the provisions
 of  such  articles of this chapter. The commissioner and the comptroller
 shall maintain a system  of  accounts  showing  the  amount  of  revenue
 collected  or  received from each of the taxes imposed by such articles.
 The comptroller, after reserving the  amount  to  pay  such  refunds  or
 reimbursements,  shall,  on  or  before the tenth day of each month, pay
 into the state treasury to the credit of the general  fund  all  revenue
 deposited  under  this  section  during the preceding calendar month and
 remaining to the comptroller's credit on the last day of such  preceding
 month, (i) except that the comptroller shall pay to the state department
 of social services that amount of overpayments of tax imposed by article
 twenty-two  of  this  chapter  and  the interest on such amount which is
 certified to the comptroller by the commissioner as  the  amount  to  be
 credited against past-due support pursuant to subdivision six of section
 one  hundred  seventy-one-c  of  this  article, (ii) and except that the
 comptroller shall pay to the New York state  higher  education  services
 corporation  and the state university of New York or the city university
 of New York respectively that amount of overpayments of tax  imposed  by
 article twenty-two of this chapter and the interest on such amount which
 is  certified to the comptroller by the commissioner as the amount to be
 credited against the amount  of  defaults  in  repayment  of  guaranteed
 student loans and state university loans or city university loans pursu-
 ant  to subdivision five of section one hundred seventy-one-d and subdi-
 vision six of section one hundred seventy-one-e of this  article,  (iii)
 and  except further that, notwithstanding any law, the comptroller shall
 credit  to  the  revenue  arrearage   account,   pursuant   to   section
 ninety-one-a of the state finance law, that amount of overpayment of tax
 imposed  by article nine, nine-A, twenty-two, thirty, thirty-A, thirty-B
 or thirty-three of this chapter, and  any  interest  thereon,  which  is
 certified  to  the  comptroller  by the commissioner as the amount to be
 credited against a past-due legally enforceable debt  owed  to  a  state
 agency  pursuant  to  paragraph  (a)  of  subdivision six of section one

 A. 4663--B                         11
 
 hundred seventy-one-f of this article, provided, however, he shall cred-
 it to the special offset fiduciary account, pursuant to section  ninety-
 one-c  of the state finance law, any such amount creditable as a liabil-
 ity  as  set  forth  in  paragraph (b) of subdivision six of section one
 hundred seventy-one-f of this article, (iv) and except further that  the
 comptroller shall pay to the city of New York that amount of overpayment
 of  tax  imposed  by article nine, nine-A, twenty-two, thirty, thirty-A,
 thirty-B or thirty-three of this chapter and any interest  thereon  that
 is  certified to the comptroller by the commissioner as the amount to be
 credited against city of New York tax warrant judgment debt pursuant  to
 section  one  hundred  seventy-one-l  of  this  article,  (v) and except
 further that the comptroller shall pay to a  non-obligated  spouse  that
 amount of overpayment of tax imposed by article twenty-two of this chap-
 ter  and the interest on such amount which has been credited pursuant to
 section  one  hundred  seventy-one-c,  one  hundred  seventy-one-d,  one
 hundred  seventy-one-e,  one hundred seventy-one-f or one hundred seven-
 ty-one-l of this article and which is certified to  the  comptroller  by
 the commissioner as the amount due such non-obligated spouse pursuant to
 paragraph six of subsection (b) of section six hundred fifty-one of this
 chapter;  and  (vi) the comptroller shall deduct a like amount which the
 comptroller shall pay into the treasury to the  credit  of  the  general
 fund  from  amounts  subsequently  payable  to  the department of social
 services, the state university of New York, the city university  of  New
 York,  or  the  higher  education  services  corporation, or the revenue
 arrearage account  or  special  offset  fiduciary  account  pursuant  to
 section  ninety-one-a  or  ninety-one-c of the state finance law, as the
 case may be, whichever had been credited the amount originally  withheld
 from  such  overpayment,  and  (vii)  with respect to amounts originally
 withheld from such overpayment pursuant to section one hundred  seventy-
 one-l  of this article and paid to the city of New York, the comptroller
 shall collect a like amount from the city of New York.
   § 6. Subdivisions 2, 3 and paragraph (a) of subdivision 5  of  section
 92-z  of  the  state  finance law, as amended by section 5 of part MM of
 chapter 59 of the laws of 2018, are amended to read as follows:
   2. Such fund shall consist of (a) fifty percent of receipts  from  the
 imposition  of  personal  income taxes pursuant to article twenty-two of
 the tax law, less such amounts  as  the  commissioner  of  taxation  and
 finance  may  determine  to  be  necessary  for refunds, [and] (b) fifty
 percent of receipts from the imposition of employer compensation expense
 taxes pursuant to article twenty-four of the tax law, less such  amounts
 as  the  commissioner of taxation and finance may determine to be neces-
 sary for refunds, AND (C) FIFTY PERCENT OF RECEIPTS FROM THE  IMPOSITION
 OF  THE  PASS-THROUGH  ENTITY TAXES PURSUANT TO ARTICLE TWENTY-FOUR-A OF
 THE TAX LAW, LESS SUCH AMOUNTS AS THE COMMISSION OF TAXATION AND FINANCE
 MAY DETERMINE TO BE NECESSARY FOR REFUNDS.
   3. (a) Beginning on the first day of each month, the comptroller shall
 deposit all of the receipts collected pursuant to  section  six  hundred
 seventy-one of the tax law in the revenue bond tax fund until the amount
 of  monthly receipts anticipated to be deposited pursuant to the certif-
 icate required in paragraph (b) of subdivision five of this section  are
 met.  On  or  before  the twelfth day of each month, the commissioner of
 taxation and finance shall certify to the state comptroller the  amounts
 specified  in  paragraph (a) of subdivision two of this section relating
 to the preceding month and, in addition, no  later  than  March  thirty-
 first of each fiscal year the commissioner of taxation and finance shall
 certify such amounts relating to the last month of such fiscal year. The

 A. 4663--B                         12

 amounts  so certified shall be deposited by the state comptroller in the
 revenue bond tax fund.
   (b)  Beginning  on  the first day of each month, the comptroller shall
 deposit all of the receipts collected pursuant to section eight  hundred
 fifty-four  of the tax law in the revenue bond tax fund until the amount
 of monthly receipts anticipated to be deposited pursuant to the  certif-
 icate  required in paragraph (b) of subdivision five of this section are
 met. On or before the twelfth day of each  month,  the  commissioner  of
 taxation  and finance shall certify to the state comptroller the amounts
 specified in paragraph (b) of subdivision two of this  section  relating
 to  the  preceding  month  and, in addition, no later than March thirty-
 first of each fiscal year the commissioner of taxation and finance shall
 certify such amounts relating to the last month of such fiscal year. The
 amounts so certified shall be deposited by the state comptroller in  the
 revenue bond tax fund.
   (C)  BEGINNING  ON  THE FIRST DAY OF EACH MONTH, THE COMPTROLLER SHALL
 DEPOSIT ALL OF THE RECEIPTS COLLECTED PURSUANT TO SECTIONS EIGHT HUNDRED
 SIXTY-FOUR AND EIGHT HUNDRED SIXTY-FIVE OF THE TAX LAW  IN  THE  REVENUE
 BOND  TAX  FUND  UNTIL  THE AMOUNT OF MONTHLY RECEIPTS ANTICIPATED TO BE
 DEPOSITED PURSUANT TO THE  CERTIFICATE  REQUIRED  IN  PARAGRAPH  (B)  OF
 SUBDIVISION  FIVE  OF THIS SECTION ARE MET. ON OR BEFORE THE TWELFTH DAY
 OF EACH MONTH, THE COMMISSIONER OF TAXATION AND FINANCE SHALL CERTIFY TO
 THE STATE COMPTROLLER THE AMOUNTS SPECIFIED IN PARAGRAPH (C) OF SUBDIVI-
 SION TWO OF THIS SECTION RELATING TO THE PRECEDING MONTH AND,  IN  ADDI-
 TION,  NO  LATER THAN MARCH THIRTY-FIRST OF EACH FISCAL YEAR THE COMMIS-
 SIONER OF TAXATION AND FINANCE SHALL CERTIFY SUCH  AMOUNTS  RELATING  TO
 THE  LAST  MONTH  OF SUCH FISCAL YEAR. THE AMOUNTS SO CERTIFIED SHALL BE
 DEPOSITED BY THE STATE COMPTROLLER IN THE REVENUE BOND TAX FUND.
   (a) The state comptroller shall from time to time,  but  in  no  event
 later than the fifteenth day of each month (other than the last month of
 the  fiscal  year)  and  no  later than the thirty-first day of the last
 month of each fiscal year, pay over and distribute to the credit of  the
 general  fund  of  the state treasury all moneys in the revenue bond tax
 fund, if any, in excess of the aggregate amount required to be set aside
 for the payment of cash requirements pursuant to paragraph (b)  of  this
 subdivision,  provided  that  an  appropriation has been made to pay all
 amounts specified in any certificate or certificates  delivered  by  the
 director  of the budget pursuant to paragraph (b) of this subdivision as
 being required by each authorized issuer as  such  term  is  defined  in
 section  sixty-eight-a  of this chapter for the payment of cash require-
 ments of such issuers for such fiscal year. Subject  to  the  rights  of
 holders  of  debt  of the state, in no event shall the state comptroller
 pay over and distribute any moneys on deposit in the  revenue  bond  tax
 fund  to  any  person  other  than an authorized issuer pursuant to such
 certificate or certificates (i) unless and until the  aggregate  of  all
 cash requirements certified to the state comptroller as required by such
 authorized  issuers  to  be  set aside pursuant to paragraph (b) of this
 subdivision for such fiscal year shall have been  appropriated  to  such
 authorized  issuers  in  accordance  with  the schedule specified in the
 certificate or certificates filed by the director of the budget or  (ii)
 if,  after  having  been  so  certified  and  appropriated,  any payment
 required to be made pursuant to paragraph (b) of  this  subdivision  has
 not  been made to the authorized issuers which was required to have been
 made pursuant to such certificate or  certificates;  provided,  however,
 that  no  person,  including  such  authorized issuers or the holders of
 revenue bonds, shall have any lien on moneys on deposit in  the  revenue

 A. 4663--B                         13
 
 bond  tax  fund.  Any  agreement entered into pursuant to section sixty-
 eight-c of this chapter  related  to  any  payment  authorized  by  this
 section shall be executory only to the extent of such revenues available
 to the state in such fund. Notwithstanding subdivisions two and three of
 this section, in the event the aggregate of all cash requirements certi-
 fied  to the state comptroller as required by such authorized issuers to
 be set aside pursuant to paragraph  (b)  of  this  subdivision  for  the
 fiscal year beginning on April first shall not have been appropriated to
 such authorized issuers in accordance with the schedule specified in the
 certificate or certificates filed by the director of the budget or, (ii)
 if,  having  been so certified and appropriated, any payment required to
 be made pursuant to paragraph (b) of this subdivision has not been  made
 pursuant  to  such  certificate  or certificates, all receipts collected
 pursuant to section six  hundred  seventy-one  of  the  tax  law,  [and]
 section  eight  hundred fifty-four of the tax law, SECTION EIGHT HUNDRED
 SIXTY-FOUR OF THE TAX LAW, AND SECTION EIGHT HUNDRED SIXTY-FIVE  OF  THE
 TAX LAW shall be deposited in the revenue bond tax fund until the great-
 er of forty percent of the aggregate of the receipts from the imposition
 of  (A) the personal income tax imposed by article twenty-two of the tax
 law, [and] (B) the employer compensation expense tax imposed by  article
 twenty-four  of the tax law, AND (C) THE PASS-THROUGH ENTITY TAX IMPOSED
 BY ARTICLE TWENTY-FOUR-A OF THE TAX LAW for the fiscal year beginning on
 April first and as specified in the certificate or certificates filed by
 the director of the budget pursuant to this  paragraph  or  a  total  of
 twelve  billion dollars has been deposited in the revenue bond tax fund.
 Notwithstanding any other provision of law, if the state  has  appropri-
 ated  and  paid  to the authorized issuers the amounts necessary for the
 authorized issuers to meet their requirements  for  the  current  fiscal
 year pursuant to the certificate or certificates submitted by the direc-
 tor  of  the budget pursuant to paragraph (b) of this section, the state
 comptroller shall, on the last day of  each  fiscal  year,  pay  to  the
 general  fund  of  the  state all sums remaining in the revenue bond tax
 fund on such date except such amounts as the director of the budget  may
 certify  are  needed to meet the cash requirements of authorized issuers
 during the subsequent fiscal year.
   § 7. Subdivision 5 of section  68-c  of  the  state  finance  law,  as
 amended  by  section  6 of part MM of chapter 59 of the laws of 2018, is
 amended to read as follows:
   5. Nothing contained in this article shall be deemed to  restrict  the
 right  of the state to amend, repeal, modify or otherwise alter statutes
 imposing  or  relating  to  the  taxes  imposed  pursuant   to   article
 twenty-two,  [and] article twenty-four, AND ARTICLE TWENTY-FOUR-A of the
 tax law. The authorized issuers shall not include within any resolution,
 contract or agreement with holders of the  revenue  bonds  issued  under
 this  article  any  provision  which provides that a default occurs as a
 result of the state exercising its right to  amend,  repeal,  modify  or
 otherwise  alter the taxes imposed pursuant to article twenty-two, [and]
 article twenty-four, AND ARTICLE TWENTY-FOUR-A of the tax law.
   § 8. This act shall take effect immediately and  shall  apply  to  all
 taxable  years beginning on or after January 1, 2021; provided, however,
 that the amendments to subdivision 1 of section 171-a  of  the  tax  law
 made by section four of this act shall not affect the expiration of such
 subdivision  and  shall  expire  therewith,  when  upon  such  date  the
 provisions of section five of this act shall take effect.