S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   2040
 
                        2023-2024 Regular Sessions
 
                           I N  A S S E M B L Y
 
                             January 23, 2023
                                ___________
 
 Introduced  by M. of A. HAWLEY, McDONOUGH, PALMESANO, DiPIETRO, MORINEL-
   LO, NORRIS, JENSEN, ANGELINO, GALLAHAN, LEMONDES,  DeSTEFANO,  MANKTE-
   LOW,  BYRNES -- Multi-Sponsored by -- M. of A. THIELE -- read once and
   referred to the Committee on Ways and Means
 
 AN ACT to amend the tax law, in relation to the eligibility  of  farmers
   leasing land for the agricultural property tax credit
 
   THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section 1. Paragraphs (a) and (b) of subdivision 11 of  section  210-B
 of  the  tax  law, as added by section 17 of part A of chapter 59 of the
 laws of 2014, are amended to read as follows:
   (a) General. In the case of a taxpayer which  is  an  eligible  farmer
 [or],  an  eligible farmer [who] WHICH has paid taxes pursuant to a land
 contract OR AN ELIGIBLE FARMER WHICH HAS A  LEASEHOLD  INTEREST  OF  NOT
 FEWER  THAN  FIVE CONTINUOUS YEARS AS A LESSEE OF QUALIFIED AGRICULTURAL
 PROPERTY, there shall be allowed  a  credit  for  the  allowable  school
 district  property  taxes.  The term "allowable school district property
 taxes" means the school district property taxes paid during the  taxable
 year  on qualified agricultural property, subject to the acreage limita-
 tion provided in paragraph (e) of this subdivision and the income  limi-
 tation provided in paragraph (f) of this subdivision.
   (b)  Eligible  farmer.  For  purposes  of  this  subdivision, the term
 "eligible farmer" means a taxpayer whose federal gross income from farm-
 ing for the taxable year is at least two-thirds of excess federal  gross
 income.  The  term  "eligible  farmer" also includes a corporation other
 than the taxpayer of record for qualified agricultural  land  which  has
 paid  the  school  district  property  taxes on such land OR WHICH HAS A
 LEASEHOLD INTEREST OF NOT FEWER THAN FIVE CONTINUOUS YEARS AS  A  LESSEE
 OF  SUCH  LAND  pursuant  to  a contract for the future purchase of such
 land; provided that such corporation has a  federal  gross  income  from
 farming  for  the  taxable  year  which is at least two-thirds of excess
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
                                                            LBD04320-01-3
              

 A. 2040                             2
 
 federal gross income; and provided further  that,  in  determining  such
 income  eligibility, a taxpayer may, for any taxable year, use the aver-
 age of such federal gross income from farming for that taxable year  and
 such  income for the two consecutive taxable years immediately preceding
 such taxable year.   Excess federal gross income  means  the  amount  of
 federal  gross income from all sources for the taxable year in excess of
 thirty thousand dollars. For the purposes of  this  paragraph,  payments
 from  the  state's  farmland  protection  program,  administered  by the
 department of agriculture and markets,  shall  be  included  as  federal
 gross income from farming for otherwise eligible farmers.
   §  2.  Paragraphs  1 and 2 of subsection (n) of section 606 of the tax
 law, paragraph 1 as amended by chapter 315 of the laws of 1998 and para-
 graph 2 as amended by chapter 297 of the laws of 2010,  are  amended  to
 read as follows:
   (1) General. In the case of a taxpayer who is an eligible farmer [or],
 an eligible farmer who has paid taxes pursuant to a land contract, OR AN
 ELIGIBLE  FARMER  WHO  HAS  A  LEASEHOLD INTEREST OF NOT FEWER THAN FIVE
 CONTINUOUS YEARS AS A LESSEE OF QUALIFIED AGRICULTURAL  PROPERTY,  there
 shall  be  allowed  a  credit for the allowable school district property
 taxes. The term "allowable school district  property  taxes"  means  the
 school district property taxes paid during the taxable year on qualified
 agricultural  property,  subject  to  the acreage limitation provided in
 paragraph five of this subsection and the income limitation provided  in
 paragraph  six  of this subsection. Such credit shall be allowed against
 the taxes imposed by this article for the taxable year  reduced  by  the
 credits  permitted  by this article. If the credit exceeds the tax as so
 reduced, the taxpayer may receive, and the  comptroller,  subject  to  a
 certificate  of  the  commissioner, shall pay as an overpayment, without
 interest, the amount of such excess.
   (2) Eligible farmer. For purposes of this subsection, the term "eligi-
 ble farmer" means a taxpayer whose federal gross income from farming for
 the taxable year is at least two-thirds of excess federal gross  income.
 The  term  "eligible  farmer" also includes an individual other than the
 taxpayer of record for qualified agricultural  land  who  has  paid  the
 school  district  property taxes on such land pursuant to a contract for
 the future purchase of such land OR WHO HAS A LEASEHOLD INTEREST OF  NOT
 FEWER THAN FIVE CONTINUOUS YEARS AS A LESSEE OF SUCH LAND; provided that
 such  individual has a federal gross income from farming for the taxable
 year which is at least two-thirds of excess federal  gross  income;  and
 provided further that, in determining such income eligibility, a taxpay-
 er  may,  for  any  taxable  year, use the average of such federal gross
 income from farming for that taxable year and such income  for  the  two
 consecutive  taxable  years  immediately  preceding  such  taxable year.
 Excess federal gross income means the amount  of  federal  gross  income
 from  all sources for the taxable year reduced by the sum (not to exceed
 thirty thousand dollars) of those items included in federal gross income
 which consist of (i) earned income,  (ii)  pension  payments,  including
 social  security  payments,  (iii)  interest,  and  (iv)  dividends. For
 purposes of this paragraph, the term "earned income" [shall mean]  MEANS
 wages,  salaries,  tips and other employee compensation, and those items
 of gross income which are includible in the computation of net  earnings
 from  self-employment. For the purposes of this paragraph, payments from
 the state's farmland protection program, administered by the  department
 of  agriculture  and  markets, shall be included as federal gross income
 from farming for otherwise eligible farmers.
 A. 2040                             3
 
   § 3. This act shall take effect immediately and shall apply to taxable
 years commencing on or after January 1, 2025.  Effective immediately the
 addition, amendment and/or repeal of any rule  or  regulation  necessary
 for  the implementation of this act on its effective date are authorized
 to be made on or before such date.