BILL NUMBER: S4962

SPONSOR: JACKSON
 
TITLE OF BILL:

An act to amend the tax law, in relation to contributions to family
tuition accounts

 
PURPOSE:

To increase the amount that a family can deduct from their income taxes
for contributions to the college choice tuition savings accounts.

 
SUMMARY OF PROVISIONS:

Section 1 amends paragraph 32 of subsection (c) of Section 612 of the
Tax Law to double the exclusion a single payer can claim for contrib-
utions to a family tuition account from five to ten thousand dollars for
a single filer, and from ten to twenty thousand dollars for married
filers filing jointly.

Section 2 is the Effective date.
              

 
JUSTIFICATION:

In the late 1990s New York created the New York State College Choice
Tuition Savings Program, also known as the 529 College Savings Program.
Families can set up 529 accounts for their children and contributions
into these accounts can be later used to pay for any qualifying educa-
tional expenses, be it tuition, fees, textbooks, and certain room and
board costs. New York's 529 College Savings Program has proven quite
popular. According to market reports New York's College Savings Program
is the second largest in the country, with over 764,000 accounts open
totaling over $14.23 billion in funds invested in the program.

The amounts that individuals can deduct from their taxes for contrib-
utions to these accounts has not changed since the early 2000s. As the
College Board report shows, the increase in the costs of tuition plus
additional expenses has been significant. The average total costs at
4-year private nonprofit institutions have increased by 25% from the
2002-2003 academic year to the 2012-2013 academic year and at public
4-year institutions the increase has been an incredible 45% in the same
time. The amount individuals can contribute to these accounts tax free
needs to keep up with the massive inflation in college costs that we
have seen in the last decade.

 
LEGISLATIVE HISTORY:

2021-2022: S.2619 - Referred to Budget and Revenue

2019-2020: S.3485 - Referred to Budget and Revenue/A.5682 - Referred to
Ways and Means

2017-2018: S.396 - Referred to Investigations and Government
Operations/A.6272 - Referred to Ways and Means

2015-2016: S.1225 - Recommitted to Rules/A.6580 - Referred to Ways and
Means

2013-2014: S.7197 - Referred to Investigations and Government
Operations/A.9665 - Referred to Ways and Means

 
STATE AND LOCAL FISCAL IMPLICATIONS:

To be determined.

 
EFFECTIVE DATE:
This act shall take effect immediately, and shall apply to the taxable
year in which it takes effect and taxable years commencing on or after
such date.