Bill S6223-2013

Relates to reducing farm-based taxes

Relates to reducing farm-based taxes.

Details

Actions

  • Jan 8, 2014: REFERRED TO INVESTIGATIONS AND GOVERNMENT OPERATIONS

Memo

BILL NUMBER:S6223

TITLE OF BILL: An act to amend the tax law, in relation to reducing farm-based taxes

PURPOSE: To allow farms, commercial horse boarding operations, and agricultural service providers to use their net income, in place of their gross income, for tax purposes.

SUMMARY OF PROVISIONS:

Section 1 amends subparagraphs (A) and (B) of paragraph 3 of subsection (c) of section 658 of the Tax Law. Subparagraph (A) is amended to allow farms, commercial horse boarding operations or agricultural service providers 120 days after the last day of the taxable year to make payment of their required filing fee. Subparagraph (B) is amended to allow companies engaged primarily in farming, commercial horse boarding operations or agricultural service providers to use their net income as reported for federal tax purposes in place of their federal gross income.

Section 2 amends subparagraph 4 of paragraph (d) of subdivision 1 of section 210 of the Tax Law to allow corporations engaged primarily in farming, commercial horse boarding or providing agricultural services to have the term New York receipts refer to net farm income as reported for federal tax purposes.

Section 3 provides that this act shall take effect immediately.

JUSTIFICATION: This bill is necessary because the current tax system uses gross income instead of net income. Gross income does not take into account the high expenses farms and other agricultural operations incur to yield their products. Only by using net income are the unusually high expenses of an agricultural business taken into account, thereby allowing a more accurate filing of their income.

Additionally, this bill will remove a few of the many onerous and burdensome requirements that are imposed on farms and agricultural businesses in New York State. By lifting a few of these requirements, farms will begin to experience some relief. This will make New York State a place where farms and businesses can grow and create jobs.

LEGISLATIVE HISTORY: New Bill.

FISCAL IMPLICATIONS: Minimal.

EFFECTIVE DATE: This act shall take effect immediately.


Text

STATE OF NEW YORK ________________________________________________________________________ 6223 IN SENATE (PREFILED) January 8, 2014 ___________
Introduced by Sens. RITCHIE, GALLIVAN, SEWARD -- read twice and ordered printed, 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 reducing farm-based taxes THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM- BLY, DO ENACT AS FOLLOWS: Section 1. Subparagraphs (A) and (B) of paragraph 3 of subsection (c) of section 658 of the tax law, subparagraph (A) as amended by section 18 of part U of chapter 61 of the laws of 2011 and subparagraph (B) as amended by section 1 of part H-1 of chapter 57 of the laws of 2009, are amended to read as follows: (A) Every subchapter K limited liability company, every limited liability company that is a disregarded entity for federal income tax purposes, and every partnership which has any income derived from New York sources, determined in accordance with the applicable rules of section six hundred thirty-one of this article as in the case of a nonresident individual, shall, within sixty days after the last day of the taxable year, make a payment of a filing fee. SUCH DEADLINE SHALL NOT APPLY TO FARMS, COMMERCIAL HORSE BOARDING OPERATIONS OR AGRICULTURAL SERVICE PROVIDERS SUBJECT TO THE FEE, WHICH SHALL, WITHIN ONE HUNDRED TWENTY DAYS AFTER THE LAST DAY OF THE TAXABLE YEAR, MAKE PAYMENT OF ANY REQUIRED FILING FEE. The amount of the filing fee is the amount set forth in subparagraph (B) of this paragraph. The minimum filing fee is twenty-five dollars for taxable years beginning in two thousand eight and thereafter. Limited liability companies that are disregarded enti- ties for federal income tax purposes must pay a filing fee of twenty- five dollars for taxable years beginning on or after January first, two thousand eight. (B) The filing fee will be based on the New York source gross income of the limited liability company or partnership for the taxable year immediately preceding the taxable year for which the fee is due. If the limited liability company or partnership does not have any New York source gross income for the taxable year immediately preceding the taxa-
ble year for which the fee is due, the limited liability company or partnership shall pay the minimum filing fee. Partnerships, other than limited liability partnerships under article eight-B of the partnership law and foreign limited liability partnerships, with less than one million dollars in New York source gross income are exempt from the filing fee. New York source gross income is the sum of the partners' or members' shares of federal gross income from the partnership or limited liability company derived from or connected with New York sources, determined in accordance with the provisions of section six hundred thirty-one of this article as if those provisions and any related provisions expressly referred to a computation of federal gross income from New York sources. For this purpose, federal gross income is computed without any allowance or deduction for cost of goods sold, EXCEPT THAT FOR COMPANIES ENGAGED PRIMARILY IN FARMING, COMMERCIAL HORSE BOARDING OR AGRICULTURAL SERVICE PROVIDERS, THE TERM FEDERAL GROSS INCOME SHALL MEAN NET INCOME AS REPORTED FOR FEDERAL TAX PURPOSES. The amount of the filing fee for taxable years beginning on or after January first, two thousand eight will be determined in accordance with the following table: If the New York source gross income is: The fee is: not more than $100,000 $25 more than $100,000 but not over $250,000 $50 more than $250,000 but not over $500,000 $175 more than $500,000 but not over $1,000,000 $500 more than $1,000,000 but not over $5,000,000 $1,500 more than $5,000,000 but not over $25,000,000 $3,000 Over $25,000,000 $4,500 S 2. Subparagraph 4 of paragraph (d) of subdivision 1 of section 210 of the tax law, as added by section 2 of part AA-1 of chapter 57 of the laws of 2008, is amended to read as follows: (4) Notwithstanding subparagraphs one and two of this paragraph, for taxable years beginning on or after January first, two thousand eight, the amount prescribed by this paragraph for New York S corporations will be determined in accordance with the following table: If New York receipts are: The fixed dollar minimum tax is: not more than $100,000 $ 25 more than $100,000 but not over $250,000 $ 50 more than $250,000 but not over $500,000 $ 175 more than $500,000 but not over $1,000,000 $ 300 more than $1,000,000 but not over $5,000,000 $1,000 more than $5,000,000 but not over $25,000,000 $3,000 Over $25,000,000 $4,500 Otherwise the amount prescribed by this paragraph will be determined in accordance with the following table: If New York receipts are: The fixed dollar minimum tax is: not more than $100,000 $ 25 more than $100,000 but not over $250,000 $ 75 more than $250,000 but not over $500,000 $ 175 more than $500,000 but not over $1,000,000 $ 500 more than $1,000,000 but not over $5,000,000 $1,500 more than $5,000,000 but not over $25,000,000 $3,500
Over $25,000,000 $5,000 For purposes of this paragraph, New York receipts are the receipts computed in accordance with subparagraph two of paragraph (a) of subdi- vision three of this section for the taxable year, EXCEPT THAT FOR CORPORATIONS ENGAGED PRIMARILY IN FARMING, COMMERCIAL HORSE BOARDING OR PROVIDING AGRICULTURAL SERVICES, THE TERM NEW YORK RECEIPTS SHALL REFER TO NET FARM INCOME AS REPORTED FOR FEDERAL TAX PURPOSES. S 3. This act shall take effect immediately.

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