Creates an agricultural crop loss personal income tax credit.
BILL NUMBER:S7551 REVISED 06/04/12
TITLE OF BILL: An act to amend the tax law, in relation to establishing an agricultural crop loss personal income tax credit
PURPOSE: The bill establishes a refundable personal income tax credit to farmers for the loss of certain crops as a result of frost for the 2012 taxable year.
SUMMARY OF SPECIFIC PROVISIONS: Section 1. Amends Section 606 of the Tax Law by adding a new subsection (uu) which establishes an agricultural crop loss refundable personal income tax credit to farmers for the loss or damage of certain agricultural crops as a result of frost injury in 2012. To be eligible for the credit, a taxpayer must derive at least two-thirds of reported federal gross income from farming for the taxable year. The amount of the credit is equal to thirty-five percent of the average value of the unit of production for New York State as reported by the USDA National Agricultural Statistics Service for 2011, multiplied by a taxpayer's acreage in production, including newly planted acreage, for the 2012 growing season.
Subsection (2) specifies that if the amount of the credit exceeds the taxpayer's tax for such year, the excess shall be treated as an overpayment of tax to be credited or refunded without having accrued interest.
Subsection (3) defines which damaged crops a taxpayer may receive a tax credit for and includes: fruits, including apples, peaches, grapes, cherries and berries; vegetables, including tomatoes, snap beans, cabbage, carrots, beets and onions; and potatoes and dry beans.
Section 2. Specifies that the effective date shall be immediately.
JUSTIFICATION: At the beginning of the 2012 growing season, New York State's farmers experienced widespread damage and loss to their crops as a result of an extremely rare severe frost event. Upon initial notification, elected officials and farm organizations immediately requested that the Governor contact the USDA Secretary of Agriculture and ask that a disaster declaration be issued for counties where farmers experienced damage to their crops. In doing so, farmers in counties that receive such a designation would be eligible for low-cost loans if their losses exceed the established threshold, as evaluated by the USDA's Farm Service Agency.
However, preliminary damage assessment estimates indicate that New York has experienced one of the worst statewide, multi-crop losses
ever witnessed in the State. Cornell's Lake Erie Regional Research.Laboratory has estimated crop losses for grapes at 40%-50%, cherries at 100%, peaches at 90%, and apples at 50%. While the level of crop loss varies based on the region of the State, elevation, and the crop's stage of growth, there is no doubt that there is a high probability that many farmers will face severe economic losses.
As a result, this legislation is vitally necessary to allow the State's farm operations and their families an opportunity to be economically viable as they plan for next year's growing season.
LEGISLATIVE HISTORY: New bill.
FISCAL IMPLICATIONS: Undetermined at this time.
EFFECTIVE DATE: Effective immediately.
STATE OF NEW YORK ________________________________________________________________________ 7551 IN SENATE June 1, 2012 ___________Introduced by Sens. RITCHIE, FARLEY, SEWARD, MAZIARZ, GRISANTI, SALAND, GOLDEN, YOUNG, O'MARA, LITTLE, NOZZOLIO, GALLIVAN, RANZENHOFER -- read twice and ordered printed, and when printed to be committed to the Committee on Investigations and Government Operations AN ACT to amend the tax law, in relation to establishing an agricultural crop loss personal income tax credit THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM- BLY, DO ENACT AS FOLLOWS: Section 1. Section 606 of the tax law is amended by adding a new subsection (uu) to read as follows: (UU) AGRICULTURAL CROP LOSS TAX CREDIT. (1) ALLOWANCE OF CREDIT. A TAXPAYER WHOSE FEDERAL GROSS INCOME FROM FARMING FOR THE TAXABLE YEAR IS AT LEAST TWO-THIRDS OF EXCESS FEDERAL GROSS INCOME SHALL BE ALLOWED A CREDIT AGAINST THE TAX IMPOSED BY THIS ARTICLE FOR THE LOSS OR DAMAGE OF ELIGIBLE CROPS AS A RESULT OF FROST INJURY FOR THE TAXABLE YEAR BEGIN- NING ON OR AFTER JANUARY FIRST, TWO THOUSAND TWELVE AND ENDING ON DECEM- BER THIRTY-FIRST, TWO THOUSAND TWELVE. THE AMOUNT OF THE CREDIT SHALL BE EQUAL TO THIRTY-FIVE PERCENT OF THE AVERAGE VALUE OF THE UNIT OF PRODUCTION FOR NEW YORK STATE AS REPORTED BY THE USDA NATIONAL AGRICUL- TURAL STATISTICS SERVICE FOR TWO THOUSAND ELEVEN, MULTIPLIED BY ACREAGE IN PRODUCTION, INCLUDING NEWLY PLANTED ACREAGE, FOR THE TWO THOUSAND TWELVE GROWING SEASON. (2) APPLICATION OF CREDIT. IF THE AMOUNT OF THE CREDIT ALLOWED UNDER THIS SUBSECTION FOR SUCH TAXABLE YEAR SHALL EXCEED THE TAXPAYER'S TAX FOR SUCH YEAR, THE EXCESS SHALL BE TREATED AS AN OVERPAYMENT OF TAX TO BE CREDITED OR REFUNDED IN ACCORDANCE WITH THE PROVISIONS OF SECTION SIX HUNDRED EIGHTY-SIX OF THIS ARTICLE, PROVIDED, HOWEVER, THAT NO INTEREST SHALL BE PAID THEREON. (3) FOR THE PURPOSES OF THIS SUBSECTION, THE TERM "ELIGIBLE CROP" SHALL MEAN: (A) FRUITS, INCLUDING APPLES, PEACHES, GRAPES, CHERRIES AND BERRIES, (B) VEGETABLES, INCLUDING TOMATOES, SNAP BEANS, CABBAGE, CARROTS, BEETS AND ONIONS, AND (C) POTATOES AND DRY BEANS. S 2. This act shall take effect immediately.EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets [ ] is old law to be omitted. LBD16115-01-2