S5016-2011 Actions

• May 31, 2012: REPORTED AND COMMITTED TO FINANCE
• May 4, 2012: PRINT NUMBER 5016C
• May 4, 2012: AMEND (T) AND RECOMMIT TO INVESTIGATIONS AND GOVERNMENT OPERATIONS
• Jan 5, 2012: PRINT NUMBER 5016B
• Jan 5, 2012: AMEND AND RECOMMIT TO INVESTIGATIONS AND GOVERNMENT OPERATIONS
• Jan 4, 2012: REFERRED TO INVESTIGATIONS AND GOVERNMENT OPERATIONS
• Jun 7, 2011: REPORTED AND COMMITTED TO FINANCE
• May 20, 2011: PRINT NUMBER 5016A
• May 20, 2011: AMEND AND RECOMMIT TO INVESTIGATIONS AND GOVERNMENT OPERATIONS
• May 2, 2011: REFERRED TO INVESTIGATIONS AND GOVERNMENT OPERATIONS

S5016-2011 Votes

S5016-2011 Memo

BILL NUMBER:S5016

TITLE OF BILL:
An act
to amend the tax law, in relation to the imposition of personal income
tax

PURPOSE:
To adjust the taxable income brackets, the standard deduction and the
dependent exemption under the personal income tax to the rate of
inflation.

SUMMARY OF PROVISIONS:
Section 1 amends section 601 of the Tax Law to adjust the rate
brackets for each personal income tax filing type for the rate of
inflation.

Section 2 amends section 601 of the Tax Law to change the calculation
of the tax benefit recapture to adjust the applicable income levels
by the rate of inflation.

Section 3 amends section 614 of the Tax Law to provide for a cost of
living adjustment equal to the rate of inflation for the standard
deduction.

Section 4 amends section 616 of the Tax Law to provide a cost of
living adjustment equal to the rate of inflation for the dependent
exemption.

JUSTIFICATION:
The Federal Government provides for a cost of living adjustment in
relation to the imposition of the personal income tax at the federal
level. This cost of living adjustment applies to the taxable income
levels to which the tax rates apply, the standard deduction and the
personal exemption.
By utilizing this cost of living adjustment, the "bracket creep" is
eliminated which forces a taxpayer into a higher income tax bracket
as a result of his income increasing due to inflation.

The personal income tax in New York does not currently include a cost
of living adjustment for the rate brackets, standard deduction or the
dependent deduction. The last time the rate brackets were adjusted
was in 1996. The standard deduction was adjusted in 2006 only for
married taxpayers to eliminate the marriage penalty. Other than that
adjustment, the standard deduction has not been changed since 1996.
The dependent exemption, which is set at $1,000 per dependent, has
not been changed since 1987. In comparison, the Federal government
exemption is equal to $3,650 per dependent.

LEGISLATIVE HISTORY:
New bill.

FISCAL IMPLICATIONS:
$230M in fiscal year 2011-12; $265M when fully effective.

EFFECTIVE DATE:
Applies to tax years beginning on or after January 1, 2011.

S5016-2011 Text

 S T A T E   O F   N E W   Y O R K
 
 
                                         5016
 2011-2012 Regular Sessions
 I N  SENATE
 May 2, 2011
 
 Introduced by Sens. DeFRANCISCO, SKELOS -- read twice and ordered print
 ed,  and  when  printed  to  be committed to the Committee on Investi
 gations and Government Operations
 

AN ACT to amend the tax law, in relation to the imposition  of  personal
 income tax
 

THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM
 BLY, DO ENACT AS FOLLOWS:

 

Section 1.

Section 601 of the tax law  is  amended  by  adding  a  new
 subsection (c-1) to read as follows:

 (C-1)  COST  OF LIVING ADJUSTMENT.  FOR TAXABLE YEARS BEGINNING ON AND
 AFTER JANUARY FIRST, TWO THOUSAND TWELVE, THE MINIMUM AND MAXIMUM DOLLAR
 AMOUNT  FOR  EACH  RATE  BRACKET  FOR  WHICH  A  TAX  IS  IMPOSED  UNDER
 SUBSECTIONS  (A), (B) AND (C) OF THIS SECTION SHALL BE INCREASED FOR THE
 COST OF LIVING ADJUSTMENT. FOR THE PURPOSES OF  THIS  SUBPARAGRAPH,  THE
 COST  OF  LIVING ADJUSTMENT FOR ANY TAXABLE YEAR SHALL BE THE PERCENTAGE
 (IF ANY) BY WHICH THE CPI FOR THE PRECEDING CALENDAR  YEAR  EXCEEDS  THE
 CPI FOR CALENDAR YEAR TWO THOUSAND TEN.  THE CPI IS DEFINED AS THE AVER
 AGE OF THE CONSUMER PRICE INDEX FOR ALL URBAN CONSUMERS PUBLISHED BY THE
 UNITED  STATES  DEPARTMENT  OF LABOR AS OF THE CLOSE OF THE TWELVE MONTH
 PERIOD ENDING AUGUST THIRTY-FIRST OF SUCH CALENDAR YEAR. IF ANY INCREASE
 DETERMINED UNDER THIS SUBPARAGRAPH IS NOT  A  MULTIPLE  OF  ONE  HUNDRED
 DOLLARS,  SUCH INCREASE SHALL BE ROUNDED TO THE NEXT HIGHEST MULTIPLE OF
 ONE HUNDRED DOLLARS.
 

S 2. Subparagraph (B) of paragraph 1 of subsection (d) of section  601
 of  the  tax law, as amended by section 1 of part R of chapter 63 of the
 laws of 2003, is amended to read as follows:

 (B) The fraction is computed as follows: (I) FOR TAXABLE YEARS  BEGIN
 NING  ON  OR  BEFORE TWO THOUSAND ELEVEN, the numerator is the lesser of
 fifty thousand dollars or the excess of New York adjusted  gross  income
 for the taxable year over one hundred thousand dollars and the denomina
 tor is fifty thousand dollars.
 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
 [ ] is old law to be omitted.
 LBD10973-01-1
 
       S. 5016                             2
 (II)  IN  THE  CASE  OF  ANY TAXABLE YEAR BEGINNING AFTER TWO THOUSAND
 ELEVEN, THE NUMERATOR IS THE LESSER OF THE DIFFERENCE BETWEEN THE  UPPER
 INCOME  THRESHOLD  AND  THE  LOWER INCOME THRESHOLD OR THE EXCESS OF NEW
 YORK ADJUSTED GROSS INCOME FOR THE TAXABLE YEAR OVER  THE  LOWER  INCOME
 THRESHOLD.  THE  DENOMINATOR  SHALL  BE THE DIFFERENCE BETWEEN THE UPPER
 INCOME THRESHOLD AND THE LOWER INCOME THRESHOLD.
 (III) FOR THE PURPOSES OF THIS SUBPARAGRAPH, THE LOWER INCOME  THRESH
 OLD SHALL BE THE PRODUCT OF ONE HUNDRED THOUSAND DOLLARS AND THE COST OF
 LIVING ADJUSTMENT AND THE UPPER INCOME THRESHOLD SHALL BE THE PRODUCT OF
 ONE HUNDRED FIFTY THOUSAND DOLLARS AND THE COST OF LIVING ADJUSTMENT.
 (IV) FOR THE PURPOSES OF THIS SUBPARAGRAPH, THE COST OF LIVING ADJUST
 MENT  FOR ANY TAXABLE YEAR SHALL BE THE PERCENTAGE (IF ANY) BY WHICH THE
 CPI FOR THE PRECEDING CALENDAR YEAR EXCEEDS THE CPI  FOR  CALENDAR  YEAR
 TWO  THOUSAND  TEN.  THE  CPI  IS DEFINED AS THE AVERAGE OF THE CONSUMER
 PRICE INDEX FOR ALL URBAN  CONSUMERS  PUBLISHED  BY  THE  UNITED  STATES
 DEPARTMENT  OF  LABOR  AS OF THE CLOSE OF THE TWELVE MONTH PERIOD ENDING
 AUGUST THIRTY-FIRST OF SUCH CALENDAR YEAR.
 (V) IF ANY INCREASE DETERMINED UNDER THIS SUBPARAGRAPH IS NOT A MULTI
 PLE OF ONE HUNDRED DOLLARS, SUCH INCREASE SHALL BE ROUNDED TO  THE  NEXT
 HIGHEST MULTIPLE OF ONE HUNDRED DOLLARS.
 

S  3.

Section 614 of the tax law is amended by adding a new subsection
 (f) to read as follows:

 (F) COST OF LIVING ADJUSTMENT.   FOR TAXABLE YEARS  BEGINNING  ON  AND
 AFTER  JANUARY  FIRST, TWO THOUSAND TWELVE, EACH DOLLAR AMOUNT CONTAINED
 IN SUBSECTIONS (A), (B), (C), (D) AND  (E)  OF  THIS  SECTION  SHALL  BE
 INCREASED  FOR  THE COST OF LIVING ADJUSTMENT.  FOR THE PURPOSES OF THIS
 SUBSECTION, THE COST OF LIVING ADJUSTMENT FOR ANY TAXABLE YEAR SHALL  BE
 THE PERCENTAGE (IF ANY) BY WHICH THE CPI FOR THE PRECEDING CALENDAR YEAR
 EXCEEDS  THE  CPI FOR CALENDAR YEAR TWO THOUSAND TEN. THE CPI IS DEFINED
 AS THE AVERAGE OF THE CONSUMER  PRICE  INDEX  FOR  ALL  URBAN  CONSUMERS
 PUBLISHED  BY  THE  UNITED STATES DEPARTMENT OF LABOR AS OF THE CLOSE OF
 THE TWELVE MONTH PERIOD ENDING  AUGUST  THIRTY-FIRST  OF  SUCH  CALENDAR
 YEAR. IF ANY INCREASE DETERMINED UNDER THIS SUBPARAGRAPH IS NOT A MULTI
 PLE  OF  ONE HUNDRED DOLLARS, SUCH INCREASE SHALL BE ROUNDED TO THE NEXT
 HIGHEST MULTIPLE OF ONE HUNDRED DOLLARS.
 

S 4.

Section 616 of the tax law is amended by adding a new  subsection
 (c) to read as follows:

 (C)  COST  OF  LIVING ADJUSTMENT.   FOR TAXABLE YEARS BEGINNING ON AND
 AFTER JANUARY FIRST, TWO THOUSAND TWELVE, EACH DOLLAR  AMOUNT  CONTAINED
 IN  SUBSECTION  (A)  OF  THIS SECTION SHALL BE INCREASED FOR THE COST OF
 LIVING ADJUSTMENT. FOR THE PURPOSES OF  THIS  SUBSECTION,  THE  COST  OF
 LIVING  ADJUSTMENT FOR ANY TAXABLE YEAR SHALL BE THE PERCENTAGE (IF ANY)
 BY WHICH THE CPI FOR THE PRECEDING CALENDAR YEAR  EXCEEDS  THE  CPI  FOR
 CALENDAR YEAR TWO THOUSAND TEN. THE CPI IS DEFINED AS THE AVERAGE OF THE
 CONSUMER  PRICE  INDEX  FOR  ALL URBAN CONSUMERS PUBLISHED BY THE UNITED
 STATES DEPARTMENT OF LABOR AS OF THE CLOSE OF THE  TWELVE  MONTH  PERIOD
 ENDING AUGUST THIRTY-FIRST OF SUCH CALENDAR YEAR. IF ANY INCREASE DETER
 MINED  UNDER THIS SUBPARAGRAPH IS NOT A MULTIPLE OF ONE HUNDRED DOLLARS,
 SUCH INCREASE SHALL BE ROUNDED TO  THE  NEXT  HIGHEST  MULTIPLE  OF  ONE
 HUNDRED DOLLARS.
 

S 5. This act shall take effect immediately and shall apply to taxable
 years  starting  on  or after January 1, 2012, provided, however, amend
 ments to the withholding tables associated with the changes in this  act
 shall not take effect until April 1, 2012.

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