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A03352 Summary:

COSPNSRReyes, Gottfried, Steck, Epstein, De La Rosa, Rosenthal L, Forrest, Simon, Mamdani, Mitaynes, Davila, Carroll, Cruz, Bronson, Anderson, Gallagher, Lunsford, Meeks, Niou, Dinowitz, Gonzalez-Rojas, Jackson, Kelles, Fahy, Seawright, Pichardo, Thiele, Clark, Solages
Add 601-b, Tax L
Relates to extending the top state income tax rate; provides for an additional tax to be imposed on certain resident's low-taxed investment income.
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A03352 Text:

                STATE OF NEW YORK
                               2021-2022 Regular Sessions
                   IN ASSEMBLY
                                    January 22, 2021
        Introduced by M. of A. KIM -- read once and referred to the Committee on
          Ways and Means
        AN  ACT  to  amend  the  tax law, in relation to extending the top state
          income tax rate
          The People of the State of New York, represented in Senate and  Assem-
        bly, do enact as follows:

     1    Section  1.  The  tax  law is amended by adding a new section 601-b to
     2  read as follows:
     3    § 601-b. Additional tax on low-taxed investment income. (a)  There  is
     4  hereby imposed, in addition to the tax imposed under section six hundred
     5  one  of  this  article,  an additional tax on a New York resident's low-
     6  taxed investment income.
     7    (b) Low-taxed investment income shall mean the amount of  an  individ-
     8  ual's  New  York  taxable income attributable to long-term capital gain,
     9  dividends, or any other type of  income  taxed  under  the  preferential
    10  rates  of  section  1(h)  of the internal revenue code, or any successor
    11  provision thereto.
    12    (c)(1) The additional tax imposed under this section shall be equal to
    13  (i) the difference between (A) the applicable federal  income  tax  rate
    14  that  would be imposed on an individual's low-taxed investment income if
    15  it were subject to the federal income  tax  rates  imposed  on  ordinary
    16  income under section 1 of the internal revenue code and (B) the applica-
    17  ble  federal  income  tax  rate  imposed at the preferential rates under
    18  section 1(h) of the internal revenue code, multiplied by (ii) the amount
    19  of an individual's low-taxed investment income, as defined in subsection
    20  (b) of this section.
    21    (2) The additional tax under paragraph one of this subsection shall be
    22  multiplied by the phase-in fraction to determine the  amount  due  under
    23  this section.  The phase-in fraction is computed as follows: the numera-
    24  tor  is  the  lesser  of  (i) an individual's New York taxable income in
    25  excess of the applicable  amount  defined  in  subsection  (d)  of  this
         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.

        A. 3352                             2
     1  section  or  (ii)  fifty  thousand dollars, and the denominator is fifty
     2  thousand dollars.
     3    (d) This section shall not apply to the following persons:
     4    (1)  In the case of resident married individuals filing joint returns,
     5  if New York taxable income is not more than two hundred  fifty  thousand
     6  dollars.
     7    (2)  In  the case of a resident head of household, an individual whose
     8  New York taxable income is not more than two hundred thousand dollars.
     9    (3) In the case of resident unmarried  individuals,  resident  married
    10  individuals filing separate returns, and resident estates and trusts, if
    11  New  York  taxable  income  is  not more than one hundred fifty thousand
    12  dollars.
    13    (e) This section shall be administered, and penalties imposed, in  the
    14  same  manner  as  the  tax imposed under section six hundred one of this
    15  article.
    16    (f) The department may adopt rules and  regulations  as  necessary  to
    17  implement the provisions of this section.
    18    § 2. This act shall take effect immediately.
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