LBD14860-03-6
A. 10340--A 2
JANUARY FIRST, TWO THOUSAND TWENTY-SIX, FOR ANY PORTION OF SUCH UNINCOR-
PORATED BUSINESS TAXABLE INCOME GREATER THAN FIVE MILLION DOLLARS, SUCH
TAX FOR SUCH PORTION SHALL BE AT A RATE OF FOUR AND FOUR-TENTHS PERCENT.
This tax shall be in addition to any other taxes imposed.
§ 3. Clauses 1 and 3 of subparagraph (a) of paragraph E of subdivision
1 of section 11-604 of the administrative code of the city of New York,
as amended by chapter 345 of the laws of 2023, are amended to read as
follows:
(1) an amount computed, for taxable years beginning before nineteen
hundred eighty-seven, at the rate of nine per centum, [and] for taxable
years beginning after nineteen hundred eighty-six AND BEFORE JANUARY
FIRST, TWO THOUSAND TWENTY-SIX, at the rate of eight and eighty-five
one-hundredths per centum, AND FOR TAXABLE YEARS BEGINNING ON OR AFTER
JANUARY FIRST, TWO THOUSAND TWENTY-SIX, AT THE RATE OF TEN AND SIXTY-TWO
ONE-HUNDREDTHS PER CENTUM, of its entire net income or the portion of
such entire net income allocated within the city as hereinafter
provided, subject to any modification required by paragraphs (d) and (e)
of subdivision three of this section,
(3) an amount computed, for taxable years beginning before nineteen
hundred eighty-seven, at the rate of nine per centum, [and] for taxable
years beginning after nineteen hundred eighty-six AND BEFORE JANUARY
FIRST, TWO THOUSAND TWENTY-SIX, at the rate of eight and eighty-five
one-hundredths per centum, AND FOR TAXABLE YEARS BEGINNING ON OR AFTER
JANUARY FIRST, TWO THOUSAND TWENTY-SIX, AT THE RATE OF TEN AND SIXTY-TWO
ONE-HUNDREDTHS PER CENTUM, on thirty per centum of the taxpayer's entire
net income plus salaries and other compensation paid to the taxpayer's
elected or appointed officers and to every stockholder owning in excess
of five per centum of its issued capital stock minus fifteen thousand
dollars (subject to proration as hereinafter provided) and any net loss
for the reported year, or on the portion of any such sum allocated with-
in the city as hereinafter provided for the allocation of entire net
income, subject to any modification required by paragraphs (d) and (e)
of subdivision three of this section, provided, however, that for taxa-
ble years beginning on or after July first, nineteen hundred ninety-six,
the provisions of paragraph H of this subdivision shall apply for
purposes of the computation under this clause, or
§ 4. The opening paragraph of subparagraph 2 of paragraph (a) of
subdivision 18 of section 11-604 of the administrative code of the city
of New York, as amended by chapter 128 of the laws of 1996, is amended
to read as follows:
The amount determined in this subparagraph is the product of (A) the
excess of (i) the tax computed under clause one of subparagraph (a) of
paragraph E of subdivision one of this section, without allowance of any
credits allowed by this section, over (ii) the tax so computed, deter-
mined as if the corporation had no such distributive share or guaranteed
payments with respect to the unincorporated business, and (B) a frac-
tion, the numerator of which is four and the denominator of which is
eight and eighty-five one hundredths, provided, however, THAT FOR A
TAXABLE YEAR BEGINNING ON OR AFTER JANUARY FIRST, TWO THOUSAND TWENTY-
SIX, SUCH DENOMINATOR SHALL BE EQUAL TO TEN AND SIXTY-TWO ONE-HUN-
DREDTHS, AND PROVIDED FURTHER that the amounts computed in clauses (i)
and (ii) of this subparagraph shall be computed with the following
modifications:
§ 5. Subparagraph 1 of paragraph (b) of subdivision 18 of section
11-604 of the administrative code of the city of New York, as amended by
chapter 128 of the laws of 1996, is amended to read as follows:
A. 10340--A 3
(1) Notwithstanding anything to the contrary in paragraph (a) of this
subdivision, in the case of a corporation that, before the application
of this subdivision or any other credit allowed by this section, is
liable for the tax on entire net income under clause one of subparagraph
(a) of paragraph E of subdivision one of this section, the credit or the
sum of the credits that may be taken by such corporation for a taxable
year under this subdivision with respect to an unincorporated business
or unincorporated businesses in which it is a partner shall not exceed
the tax so computed, without allowance of any credits allowed by this
section, multiplied by a fraction the numerator of which is four and the
denominator of which is eight and eighty-five one hundredths, PROVIDED,
HOWEVER, THAT FOR A TAXABLE YEAR BEGINNING ON OR AFTER JANUARY FIRST,
TWO THOUSAND TWENTY-SIX, SUCH DENOMINATOR SHALL BE EQUAL TO TEN AND
SIXTY-TWO ONE-HUNDREDTHS. If the credit allowed under this subdivision
or the sum of such credits exceeds the product of such tax and such
fraction, the amount of the excess may be carried forward, in order, to
each of the seven immediately succeeding taxable years and, to the
extent not previously taken, shall be allowed as a credit in each of
such years. In applying the provisions of the preceding sentence, the
credit determined for the taxable year under paragraph (a) of this
subdivision shall be taken before taking any credit carryforward pursu-
ant to this paragraph and the credit carryforward attributable to the
earliest taxable year shall be taken before taking a credit carryforward
attributable to a subsequent taxable year.
§ 6. Subdivision (a) of section 11-643.5 of the administrative code of
the city of New York, as added by local law number 37 of the city of New
York for the year 1986, is amended to read as follows:
(a) Basic tax. Nine percent of the taxpayer's entire net income, or
the portion thereof allocated to the city, for the taxable year or part
thereof, PROVIDED THAT, FOR A TAXABLE YEAR BEGINNING ON OR AFTER JANUARY
FIRST, TWO THOUSAND TWENTY-SIX, OR PART THEREOF, SUCH BASIC TAX SHALL BE
EQUAL TO TEN AND EIGHT-TENTHS PERCENT OF THE TAXPAYER'S ENTIRE NET
INCOME, OR THE PORTION THEREOF ALLOCATED TO THE CITY.
§ 7. The opening paragraph of paragraph 2 of subdivision (a) of
section 11-643.8 of the administrative code of the city of New York, as
amended by chapter 128 of the laws of 1996, is amended to read as
follows:
The amount determined in this paragraph is the product of (A) the
excess of (i) the basic tax computed pursuant to subdivision (a) of
section 11-643.5 of this part, without allowance of any credits allowed
by this part, over (ii) the basic tax so computed, determined as if the
banking corporation had no such distributive share or guaranteed
payments with respect to the unincorporated business, and (B) a frac-
tion, the numerator of which is four and the denominator of which is
nine, provided, however, THAT FOR A TAXABLE YEAR BEGINNING ON OR AFTER
JANUARY FIRST, TWO THOUSAND TWENTY-SIX, SUCH DENOMINATOR SHALL BE EQUAL
TO TEN AND EIGHT-TENTHS, AND PROVIDED FURTHER that the amounts computed
in clauses (i) and (ii) of this paragraph shall be computed with the
following modifications:
§ 8. Paragraph 1 of subdivision (b) of section 11-643.8 of the admin-
istrative code of the city of New York, as amended by chapter 128 of the
laws of 1996, is amended to read as follows:
(1) Notwithstanding anything to the contrary in subdivision (a) of
this section, in the case of a banking corporation that, before the
application of this section or any other credit allowed by this part, is
liable for the basic tax computed under subdivision (a) of section
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11-643.5 of this part, the credit or the sum of the credits that may be
taken by such banking corporation for a taxable year under this section
with respect to an unincorporated business or unincorporated businesses
in which it is a partner shall not exceed the tax so computed, without
allowance of any credits allowed by this part, multiplied by a fraction
the numerator of which is four and the denominator of which is nine,
PROVIDED, HOWEVER, THAT FOR A TAXABLE YEAR BEGINNING ON OR AFTER JANUARY
FIRST, TWO THOUSAND TWENTY-SIX, SUCH DENOMINATOR SHALL BE EQUAL TO TEN
AND EIGHT-TENTHS. If the credit allowed under this subdivision or the
sum of such credits exceeds the product of such tax and such fraction,
the amount of the excess may be carried forward, in order, to each of
the seven immediately succeeding taxable years and, to the extent not
previously taken, shall be allowed as a credit in each of such years. In
applying the provisions of the preceding sentence, the credit determined
for the taxable year under subdivision (a) of this section shall be
taken before taking any credit carryforward pursuant to this paragraph
and the credit carryforward attributable to the earliest taxable year
shall be taken before taking a credit carryforward attributable to a
subsequent taxable year.
§ 9. Clause (i) of subparagraph 1 of paragraph (e) of subdivision 1 of
section 11-654 of the administrative code of the city of New York, as
added by section 1 of part D of chapter 60 of the laws of 2015, is
amended to read as follows:
(i) an amount computed on its business income or the portion of such
business income allocated within the city as hereinafter provided,
subject to the application of paragraphs (j) and (k) of this subdivision
and any modification required by paragraphs (d) and (e) of subdivision
three of this section, at the rate of (1) FOR A TAXABLE YEAR BEGINNING
BEFORE JANUARY FIRST, TWO THOUSAND TWENTY-SIX, nine per centum for
financial corporations, as defined in this clause, AND FOR A TAXABLE
YEAR BEGINNING ON OR AFTER JANUARY FIRST, TWO THOUSAND TWENTY-SIX, TEN
AND EIGHT-TENTHS PER CENTUM FOR FINANCIAL CORPORATIONS, or (2) FOR A
TAXABLE YEAR BEGINNING BEFORE JANUARY FIRST, TWO THOUSAND TWENTY-SIX,
eight and eighty-five one hundredths per centum for all other corpo-
rations, AND FOR A TAXABLE YEAR BEGINNING ON OR AFTER JANUARY FIRST, TWO
THOUSAND TWENTY-SIX, TEN AND SIXTY-TWO ONE-HUNDREDTHS PER CENTUM FOR ALL
OTHER CORPORATIONS. For purposes of this clause, "financial corporation"
means a corporation or, if the corporation is included in a combined
group, a combined group, that (A) has total assets reflected on its
balance sheet at the end of its taxable year in excess of one hundred
billion dollars, computed under generally accepted accounting principles
and (B)(I) allocates more than fifty percent of the receipts included in
the denominator of its receipts fraction, determined under section
11-654.2 of this subchapter, pursuant to subdivision five of section
11-654.2 of this subchapter for its taxable year, or (II) is itself or
is included in a combined group in which more than fifty percent of the
total assets reflected on its balance sheet at the end of its taxable
year are held by one or more corporations that are classified as (a)
registered under state law as a bank holding company or registered under
the Federal Bank Holding Company Act of 1956 (12 U.S.C. § 1841, et seq.,
as amended), or registered as a savings and loan holding company under
the Federal National Housing Act (12 U.S.C. 1701, as amended), (b) a
national bank organized and existing as a national bank association
pursuant to the provisions of the National Bank Act, 12 U.S.C. 21 et.
seq., (c) a savings association or federal savings bank as defined in
the Federal Deposit Insurance Act, 12 U.S.C. § 1813(b)(1), (d) a bank,
A. 10340--A 5
savings association, or thrift institution incorporated or organized
under the laws of any state, (e) a corporation organized under the
provisions of 12 U.S.C. §§ 611 to 631, (f) an agency or branch or a
foreign depository as defined in 12 U.S.C. § 3101, (g) a registered
securities or commodities broker or dealer registered as such by the
securities and exchange commission or the commodities futures trading
commission, which shall include an OTC derivatives dealer as defined
under regulations of the securities and exchange commission at title 17,
part 240, section 3b-12 of the code of federal regulations (17 CFR
240.3b-12), or (h) any corporation whose voting stock is more than fifty
percent owned, directly or indirectly, by any person or business entity
described in subitems (a) through (g) of this item, other than an insur-
ance company taxable under article thirty-three of the tax law; or
§ 10. Subparagraphs 2 and 3 of paragraph (j) of subdivision 1 of
section 11-654 of the administrative code of the city of New York, as
added by section 1 of part D of chapter 60 of the laws of 2015, are
amended to read as follows:
(2) Subject to subparagraph three of this paragraph, if the amount of
business income allocated within the city as hereinafter provided is one
million dollars or greater but less than one million five hundred thou-
sand dollars, the amount computed in clause (i) of subparagraph one of
paragraph (e) of this subdivision shall be at the rate of (i) six and
five-tenths per centum, plus (ii) [two and thirty-five one-hundredths
per centum] A GENERAL SCALING FACTOR multiplied by a fraction the numer-
ator of which is allocated business income less one million dollars and
the denominator of which is five hundred thousand dollars, of the amount
of business income allocated within the city as hereinafter provided,
subject to any modification required by paragraphs (d) and (e) of subdi-
vision three of this section;
(3) Provided, however, notwithstanding anything to the contrary, if
the amount of business income before allocation is two million dollars
or greater but less than three million dollars, the rate of tax provided
for in this paragraph shall not be less than (i) six and five-tenths per
centum, plus (ii) [two and thirty-five one-hundredths per centum] A
GENERAL SCALING FACTOR multiplied by a fraction the numerator of which
is business income before allocation less two million dollars and the
denominator of which is one million dollars, and provided, however,
notwithstanding anything to the contrary, if the amount of business
income before allocation is three million dollars or greater, the rate
of tax shall be eight and eighty-five one-hundredths percentum FOR A
TAXABLE YEAR BEGINNING BEFORE JANUARY FIRST, TWO THOUSAND TWENTY-SIX,
AND TEN AND SIXTY-TWO ONE-HUNDREDTHS PER CENTUM FOR A TAXABLE YEAR
BEGINNING ON OR AFTER JANUARY FIRST, TWO THOUSAND TWENTY-SIX, or, in the
case of a financial corporation, as defined in clause (i) of subpara-
graph one of paragraph (e) of THIS subdivision [one of section 11-654],
if the amount of business income before allocation is three million
dollars or greater the rate of tax shall be nine per centum FOR A TAXA-
BLE YEAR BEGINNING BEFORE JANUARY FIRST, TWO THOUSAND TWENTY-SIX, AND
TEN AND EIGHT-TENTHS PER CENTUM FOR A TAXABLE YEAR BEGINNING ON OR AFTER
JANUARY FIRST, TWO THOUSAND TWENTY-SIX. FOR THE PURPOSES OF THIS SUBPAR-
AGRAPH AND SUBPARAGRAPH TWO OF THIS PARAGRAPH, THE TERM "GENERAL SCALING
FACTOR" MEANS A VALUE EQUAL TO TWO AND THIRTY-FIVE ONE-HUNDREDTHS PER
CENTUM FOR A TAXABLE YEAR BEGINNING BEFORE JANUARY FIRST, TWO THOUSAND
TWENTY-SIX, OR A VALUE EQUAL TO FOUR AND TWELVE ONE-HUNDREDTHS PER
CENTUM FOR A TAXABLE YEAR BEGINNING ON OR AFTER JANUARY FIRST, TWO THOU-
SAND TWENTY-SIX.
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§ 11. Subparagraphs 2 and 3 of paragraph (k) of subdivision 1 of
section 11-654 of the administrative code of the city of New York, as
added by section 1 of part D of chapter 60 of the laws of 2015, are
amended to read as follows:
(2) Subject to subparagraph three of this paragraph for qualified New
York manufacturing corporations as defined in subparagraph four of this
paragraph, if the amount of business income allocated within the city as
hereinafter provided is ten million dollars or greater but less than
twenty million dollars, the amount computed in clause (i) of subpara-
graph one of paragraph (e) of this subdivision shall be at the rate of
(i) four and four hundred twenty-five one-thousandths per centum, plus
(ii) [four and four hundred twenty-five one-thousandths per centum] A
MANUFACTURING SCALING FACTOR multiplied by a fraction the numerator of
which is allocated business income less ten million dollars and the
denominator of which is ten million dollars, of its business income or
the portion of such business income allocated within the city as herein-
after provided, subject to any modification required by paragraphs (d)
and (e) of subdivision three of this section;
(3) Notwithstanding anything to the contrary, if the amount of busi-
ness income before allocation is twenty million dollars or greater but
less than forty million dollars, the rate of tax provided for in this
paragraph shall not be less than (i) four and four hundred twenty-five
one thousandths percentum, plus (ii) [four and four hundred twenty-five
one thousandths percentum] A MANUFACTURING SCALING FACTOR multiplied by
a fraction the numerator of which is business income before allocation
less twenty million dollars and the denominator of which is twenty
million dollars, and provided, however, notwithstanding anything to the
contrary, if the amount of business income before allocation is forty
million dollars or greater, the rate of tax shall be eight and eighty-
five one-hundredths per centum FOR A TAXABLE YEAR BEGINNING BEFORE JANU-
ARY FIRST, TWO THOUSAND TWENTY-SIX, AND TEN AND SIXTY-TWO ONE-HUNDREDTHS
PER CENTUM FOR A TAXABLE YEAR BEGINNING ON OR AFTER JANUARY FIRST, TWO
THOUSAND TWENTY-SIX. FOR THE PURPOSES OF THIS SUBPARAGRAPH AND SUBPARA-
GRAPH TWO OF THIS PARAGRAPH, THE TERM "MANUFACTURING SCALING FACTOR"
MEANS A VALUE EQUAL TO FOUR AND FOUR HUNDRED TWENTY-FIVE ONE-THOUSANDTHS
PER CENTUM FOR A TAXABLE YEAR BEGINNING BEFORE JANUARY FIRST, TWO THOU-
SAND TWENTY-SIX, OR A VALUE EQUAL TO SIX AND ONE HUNDRED NINETY-FIVE
ONE-THOUSANDTHS PER CENTUM FOR A TAXABLE YEAR BEGINNING ON OR AFTER
JANUARY FIRST, TWO THOUSAND TWENTY-SIX.
§ 12. The opening paragraph of subparagraph 2 of paragraph (a) of
subdivision 18 of section 11-654 of the administrative code of the city
of New York, as amended by section 12 of part P of chapter 60 of the
laws of 2016, is amended to read as follows:
The amount determined in this subparagraph is the product of (i) the
excess of (A) the tax computed under clause (i) of subparagraph one of
paragraph (e) of subdivision one of this section, without allowance of
any credits allowed by this section, over (B) the tax so computed,
determined as if the corporation had no such distributive share or guar-
anteed payments with respect to the unincorporated business, and (ii) a
fraction, the numerator of which is four and the denominator of which,
FOR A TAXABLE YEAR BEGINNING BEFORE JANUARY FIRST, TWO THOUSAND TWENTY-
SIX, is eight and eighty-five one hundredths, PROVIDED THAT, FOR A TAXA-
BLE YEAR BEGINNING ON OR AFTER JANUARY FIRST, TWO THOUSAND TWENTY-SIX,
SUCH DENOMINATOR IS TEN AND SIXTY-TWO ONE-HUNDREDTHS, [except] AND
PROVIDED FURTHER that in the case of a financial corporation as defined
in clause (i) of subparagraph one of paragraph (e) of subdivision one of
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this section, FOR A TAXABLE YEAR BEGINNING BEFORE JANUARY FIRST, TWO
THOUSAND TWENTY-SIX, such denominator is nine, AND FOR A TAXABLE YEAR
BEGINNING ON OR AFTER JANUARY FIRST, TWO THOUSAND TWENTY-SIX, SUCH
DENOMINATOR IS TEN AND EIGHT-TENTHS, and PROVIDED FURTHER THAT in the
case of a taxpayer that is subject to paragraph (j) or (k) of subdivi-
sion one of this section, such denominator shall be the rate of tax as
determined by such paragraph (j) or (k) for the taxable year; provided
that the amounts computed in subclauses (A) and (B) of clause (i) of
this subparagraph shall be computed with the following modifications:
§ 13. Subparagraph 1 of paragraph (b) of subdivision 18 of section
11-654 of the administrative code of the city of New York, as amended by
section 13 of part P of chapter 60 of the laws of 2016, is amended to
read as follows:
(1) Notwithstanding anything to the contrary in paragraph (a) of this
subdivision, in the case of a corporation that, before the application
of this subdivision or any other credit allowed by this section, is
liable for the tax on business income under clause (i) of subparagraph
one of paragraph (e) of subdivision one of this section, the credit or
the sum of the credits that may be taken by such corporation for a taxa-
ble year under this subdivision with respect to an unincorporated busi-
ness or unincorporated businesses in which it is a partner shall not
exceed the tax so computed, without allowance of any credits allowed by
this section, multiplied by a fraction the numerator of which is four
and the denominator of which is eight and eighty-five one-hundredths,
PROVIDED THAT, FOR A TAXABLE YEAR BEGINNING ON OR AFTER JANUARY FIRST,
TWO THOUSAND TWENTY-SIX, SUCH DENOMINATOR SHALL BE EQUAL TO TEN AND
SIXTY-TWO ONE-HUNDREDTHS, [except] AND PROVIDED FURTHER that in the case
of a financial corporation as defined in clause (i) of subparagraph one
of paragraph (e) of subdivision one of this section, such denominator,
FOR A TAXABLE YEAR BEGINNING BEFORE JANUARY FIRST, TWO THOUSAND TWENTY-
SIX, is nine, AND, FOR A TAXABLE YEAR BEGINNING ON OR AFTER JANUARY
FIRST, TWO THOUSAND TWENTY-SIX, IS TEN AND EIGHT-TENTHS, and PROVIDED
FURTHER THAT in the case of a taxpayer that is subject to paragraph (j)
or (k) of subdivision one of this section, such denominator shall be the
rate of tax as determined by such paragraph (j) or (k) for the taxable
year. If the credit allowed under this subdivision or the sum of such
credits exceeds the product of such tax and such fraction, the amount of
the excess may be carried forward, in order, to each of the seven imme-
diately succeeding taxable years and, to the extent not previously
taken, shall be allowed as a credit in each of such years. In applying
the provisions of the preceding sentence, the credit determined for the
taxable year under paragraph (a) of this subdivision shall be taken
before taking any credit carryforward pursuant to this paragraph and the
credit carryforward attributable to the earliest taxable year shall be
taken before taking a credit carryforward attributable to a subsequent
taxable year.
§ 14. The local legislative body of the city of New York is hereby
authorized and empowered to ratify and approve by local law the amend-
ments set forth in sections two through thirteen of this act, provided
that: (i) where such local legislative body ratifies and approves the
amendments set forth in section three, four, or five of this act, such
local legislative body shall ratify and approve the amendments set forth
in all of such sections three, four, and five of this act; (ii) where
such local legislative body ratifies and approves the amendments set
forth in section six, seven, or eight of this act, such local legisla-
tive body shall ratify and approve the amendments set forth in all of
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such sections six, seven, and eight of this act; and (iii) where such
local legislative body ratifies and approves the amendments set forth in
section nine, ten, eleven, twelve, or thirteen of this act, such local
legislative body shall ratify and approve the amendments set forth in
all of such sections nine, ten, eleven, twelve, and thirteen of this
act.
§ 15. This act shall take effect immediately, except that sections two
through thirteen of this act shall take effect only upon enactment of a
local law of the city of New York as described in section fourteen of
this act and shall be deemed to have been in full force and effect as of
January 1, 2026 and apply to taxable years beginning on or after such
date, provided that, where the local legislative body of the city of New
York does not ratify and approve the amendments set forth in one or more
of such sections, the amendments set forth in such sections shall not
take effect. The city of New York shall notify the legislative bill
drafting commission upon enactment of such local law as described in
section fourteen of this act in order that the commission may maintain
an accurate and timely effective data base of the official text of the
laws of the state of New York in furtherance of effectuating the
provisions of section 44 of the legislative law and section 70-b of the
public officers law.