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A08688 Summary:

BILL NOA08688
 
SAME ASSAME AS S07624
 
SPONSORThiele
 
COSPNSRSillitti, Burdick, McDonald, Englebright, Stern, Zebrowski, Otis, Lunsford
 
MLTSPNSR
 
Amd 606, Tax L
 
Increases the excess real property tax credit for certain qualified taxpayers.
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A08688 Memo:

NEW YORK STATE ASSEMBLY
MEMORANDUM IN SUPPORT OF LEGISLATION
submitted in accordance with Assembly Rule III, Sec 1(f)
 
BILL NUMBER: A8688
 
SPONSOR: Thiele
  TITLE OF BILL: An act to amend the tax law, in relation to improving the real property tax relief credit   PURPOSE: To improve the real property tax relief credit by (a) increasing maximum income eligibility from $250,000 of qualified gross income to $350,000, (b) decreasing the percentage of real property taxes over qualified gross income from 6% to 5% to determine excess property taxes, (c) increasing the amount of the credit, including the maximum credit from $350 to $1,500, and making the credit permanent.   SUMMARY OF PROVISIONS: Section 1. Amends Subparagraph (E)of paragraph 1, paragraph 2, subpara- graphs (A),(B), and (C) of paragraph 3, paragraph 4, and subparagraph (A) of paragraph 6 of subsection (e-2) of section 606 of the tax law by (a) increasing maximum income eligibility from $250,000 of qualified gross income to $350,000, (b) decreasing the percentage of real property taxes over qualified gross income from 6% to 5% to determine excess property taxes, (c) increasing the amount of the credit, including the maximum credit from $350 to $1,500, and making the credit permanent. Section 2. Effective date.   JUSTIFICATION: One of the largest contributors to housing insecurity and loss of affordable housing in New York State is high real property taxes. In addition, high property taxes adversely impact the economic competitive- ness of New York State. High property taxes have been a contributor to the exodus of population from New York State to other regions of the country. The impact of high real property taxes has been exacerbated by the COVID pandemic. The pandemic has accelerated adverse existing trends of increasing housing costs and housing insecurity. It is imperative that those trends be reversed in order to increase housing affordability and security across the state. This goal can be aided by reducing the impact of high real property taxes for families across the state. In 2021, the State Legislature enacted Section 1 of Part III,of chapter 59 providing for a real property tax relief credit. However, the income requirements, the cap on the credit, the three (3) year sunset provision, and other limitations of the credit, preclude many middle class and working class families across New York State from benefitting from the credit. Further, the size of the credit and the cap at $350, provides only minimal relief for many from the often crushing burden of property taxes. By (a) increasing maximum income eligibility for the credit from $250,000 of qualified gross income to $350,000, (b) decreasing the percentage of real property taxes over qualified gross income from 6% to 5% to determine excess property taxes, (c) increasing the amount of the credit, including the maximum credit from $350 to $1,500, and making the credit permanent, more New Yorkers will be eligible for the credit and the level of the credit will be greater, providing real property tax relief to working families on a permanent basis. The impact of this legislation will be to make housing more affordable and New York State more economically competitive.   LEGISLATIVE HISTORY: New bill.   FISCAL IMPLICATIONS: To be determined.   EFFECTIVE DATE: This act shall take effect immediately, and shall apply to taxable years beginning on or after January 1, 2022.
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A08688 Text:



 
                STATE OF NEW YORK
        ________________________________________________________________________
 
                                          8688
 
                   IN ASSEMBLY
 
                                    January 10, 2022
                                       ___________
 
        Introduced 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 improving the real property
          tax relief credit
 
          The People of the State of New York, represented in Senate and  Assem-
        bly, do enact as follows:
 
     1    Section 1. Subparagraph (E) of paragraph 1, paragraph 2, subparagraphs
     2  (A),  (B)  and  (C)  of paragraph 3, paragraph 4 and subparagraph (A) of
     3  paragraph 6 of subsection (e-2) of section 606 of the tax law, as  added
     4  by  section 1 of part III of chapter 59 of the laws of 2021, are amended
     5  to read as follows:
     6    (E) "Excess real property tax" means the  excess  of  qualifying  real
     7  property taxes over [six] five percent of qualified gross income.
     8    (2)  For  tax  years beginning on or after January first, two thousand
     9  [twenty-one and before January first, two thousand twenty-four]  twenty-
    10  two, a qualified taxpayer shall be allowed a credit as provided in para-
    11  graph  three  of this subsection against the taxes imposed by this arti-
    12  cle. If the credit exceeds the tax for such year under this article, the
    13  excess shall be treated as an overpayment, to be credited  or  refunded,
    14  without interest.
    15    (A)  For  qualified taxpayers whose qualified gross income is seventy-
    16  five thousand dollars or less, the applicable percentage shall be [four-
    17  teen] twenty percent.
    18    (B) For qualified taxpayers whose qualified gross  income  is  greater
    19  than seventy-five thousand dollars but less than or equal to one hundred
    20  fifty  thousand  dollars, the applicable percentage shall be the differ-
    21  ence between (i) [fourteen] twenty percent and (ii) five percent  multi-
    22  plied  by  a  fraction, the numerator of which is the difference between
    23  the qualified taxpayer's qualified  gross  income  as  defined  by  this
    24  subsection  and  seventy-five  thousand  dollars, and the denominator of
    25  which is seventy-five thousand dollars.
    26    (C) For qualified taxpayers whose qualified gross  income  is  greater
    27  than  one hundred fifty thousand dollars but less than or equal to [two]
    28  three hundred fifty thousand dollars, the applicable percentage shall be
 
         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD13833-01-1

        A. 8688                             2
 
     1  the difference between (i) [nine] fifteen percent and (ii)  six  percent
     2  multiplied  by  a  fraction,  the  numerator  of which is the difference
     3  between the qualified taxpayer's qualified gross income and one  hundred
     4  fifty  thousand  dollars,  and  the  denominator  of  which is [one] two
     5  hundred thousand dollars.
     6    (4) [No credit shall be allowed under this subsection  if  the  amount
     7  determined  pursuant  to  paragraph three is less than two hundred fifty
     8  dollars, provided further that if] If the amount determined pursuant  to
     9  paragraph  three is in excess of [three] fifteen hundred [fifty] dollars
    10  the taxpayer shall be  allowed  a  credit  of  [three]  fifteen  hundred
    11  [fifty] dollars.
    12    (A) To a property owner if qualified gross income for the taxable year
    13  exceeds [two] three hundred fifty thousand dollars.
    14    § 2. This act shall take effect immediately and shall apply to taxable
    15  years beginning on or after January 1, 2022.
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