NY State Senate Bill 2013-S6200

Archive: Last Bill Status - In Senate Committee Investigations And Government Operations Committee

Introduced
- In Committee Assembly
- In Committee Senate
- On Floor Calendar Assembly
- On Floor Calendar Senate
- Passed Assembly
- Passed Senate
Delivered to Governor
Signed By Governor

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	Assembly Actions - Lowercase Senate Actions - UPPERCASE
Jan 08, 2014	referred to investigations and government operations

2013-S6200 (ACTIVE) - Details

See Assembly Version of this Bill:: A8391
Current Committee:: Senate Investigations And Government Operations
Law Section:: Tax Law
Laws Affected:: Amd §1116, Tax L
Versions Introduced in Other Legislative Sessions:: 2015-2016: S1320, A3271
2017-2018: S190, A8113
2019-2020: S2652, A11023
2021-2022: S2093, A4097

2013-S6200 (ACTIVE) - Summary

Exempts certain senior citizen organizations from paying sales and compensating use taxes.

2013-S6200 (ACTIVE) - Sponsor Memo

                                BILL NUMBER:S6200

TITLE OF BILL:  An act to amend the tax law, in relation to exempting
certain senior citizen organizations from paying sales and
compensating use taxes

PURPOSE:

To specifically provide that not-for profit Senior Citizen
organizations are exempt from paying sales and compensating use taxes.

SUMMARY OF PROVISIONS:

Sections 1 and 2 amend Subdivision (a) and (g) of section 1116 of the
Tax Law to specifically include not-for-profit senior citizen
organizations which limit membership to members fifty and older, and
which are organized for pleasure, social, educational, recreational
and/or other nonprofit purposes, in the list of organizations which
are exempt from paying sales and compensating use taxes. These
organizations are exempt provided that no part of net earnings benefit
any private share holder or individual and the organizations'
substantial part of activities is not carrying propaganda, attempting
to influence legislation or campaigning on behalf of any candidate for
public office. The exemption applies to purchases made by the
organization itself and not for purposes of its members individually.

Section 3 provides that the Commissioner of Taxation and Finance is
authorized to include senior citizen organizations on Form ST-119.2 ,
the "Application for an Exempt Organization Certificate."

Section 4 states the effective date is January 1, 2015.

EXISTING LAW:

Senior citizen organizations are not explicitly named as tax-exempt.

JUSTIFICATION:

Senior citizen organizations have an easier time under federal law
attaining a tax exempt status than under New York State Law. New York
Tax Law Section 1116(a) (4) of Article 28 language mirrors the
language of Internal Revenue Code 501(c)(3). Organizations qualifying
under 501(c)(3) of the Internal Revenue Code are exempt from Federal
income tax and may use their exempt status to receive automatic
exemption from New York Sales and Use Tax. The language providing
exemption both Federally and in New York is "Any corporation,
Association, trust or community chest, fund or foundation, organized
and operated exclusively for religious, charitable, scientific,
testing for public safety, literary or educational purpose, or to
foster national or international sports competition or for the
prevention of the cruelty of animals...." The problem for senior
citizen organizations is that unless they are organized and operated
exclusively for any of these purposes, it cannot attain tax exempt
status. Senior citizen organizations attempt to claim tax exempt
status by stating that they are educational. The Division of Tax
Appeals in New York has determined that unless the senior organization
was organized and operated exclusively for educational purposes, it is


not exempt. In such a determination the appellate court looks at the
organization's purposes as defined by its organizing documents. If the
court finds that the purposes are broader than the educational purpose
specified in Section 1116(a), the organizational test is not met and
there is no grant of tax-exempt status. The court also looks at the
operational activities of the organization to see that all of its
activities accomplish one or more of the exempt purposes.
Unfortunately for the senior citizen organizations, it has been
determined that in most instances a substantial part of the
organizations' functions are social and recreational, and the
educational activities appear to be secondary. Furthermore, the
recreational trips taken by senior citizen organizations, though
seemingly educational to the seniors, is considered recreational to
the Court. The Federal law on the other hand is able to grant tax
exempt status to senior citizen organizations if not by 501(c)(3), but
by 501(c)(7) as a social club.  New York Tax Law has no such
provision. By specifically identifying Senior Citizen Organizations as
tax-exempt in New York Tax Law, it shall be clear cut that these
organizations may be educational and/or social in nature. This status
would help these organizations to save money that would normally go
towards the payment of sales tax, for the operation of their
organizations. Such monetary relief to our senior citizen
organizations would go a long way into ensuring that these
organizations thrive for the benefit of New York's senior population.

LEGISLATIVE HISTORY:

This is a new bill.

FISCAL IMPLICATIONS:

To be determined, but expected to be minimal.

EFFECTIVE DATE:

January 1, 2015.

2013-S6200 (ACTIVE) - Bill Text download pdf

                            
                    S T A T E   O F   N E W   Y O R K
________________________________________________________________________

                                  6200

                            I N  S E N A T E

                               (PREFILED)

                             January 8, 2014
                               ___________

Introduced by Sen. MARCHIONE -- read twice and ordered printed, and when
  printed to be committed to the Committee on Investigations and Govern-
  ment Operations

AN  ACT  to  amend  the tax law, in relation to exempting certain senior
  citizen organizations from paying sales and compensating use taxes

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

  Section  1. Subdivision (a) of section 1116 of the tax law, as amended
by chapter 530 of the laws of 1976, paragraph 4 as  amended  by  chapter
270  of  the  laws of 2001, paragraph 5 as amended by chapter 366 of the
laws of 1983, subparagraph (B) of paragraph 5 as amended by chapter  418
of the laws of 2004, subparagraph (C) of paragraph 5 as amended by chap-
ter  296 of the laws of 2006, paragraph 7 as added by chapter 903 of the
laws of 1980, paragraph 8 as added by chapter 888 of the laws  of  1983,
paragraph 9 as amended by chapter 591 of the laws of 2005, is amended to
read as follows:
  (a)  Except  as otherwise provided in this section, any sale or amuse-
ment charge by or to any of the following or any use or occupancy by any
of the following shall not be subject to the sales and compensating  use
taxes imposed under this article:
  (1)  The state of New York, or any of its agencies, instrumentalities,
public corporations (including a public corporation created pursuant  to
agreement or compact with another state or Canada) or political subdivi-
sions  where  it  is  the  purchaser, user or consumer, or where it is a
vendor of services or property of a kind not ordinarily sold by  private
persons[;].
  (2)  The United States of America, and any of its agencies and instru-
mentalities, insofar as it is immune  from  taxation  where  it  is  the
purchaser, user or consumer, or where it sells services or property of a
kind not ordinarily sold by private persons[;].
  (3)  The United Nations or any international organization of which the
United States of America is a member where it is the purchaser, user  or

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.

                                                           LBD13292-03-3

S. 6200                             2

consumer,  or where it sells services or property of a kind not ordinar-
ily sold by private persons[;].
  (4)  Any  corporation,  association,  trust, or community chest, fund,
foundation, or limited liability company, organized and operated  exclu-
sively for religious, charitable, scientific, testing for public safety,
literary or educational purposes, or to foster national or international
amateur  sports  competition  (but  only  if  no  part of its activities
involve the provision of athletic facilities or equipment), or  for  the
prevention  of  cruelty to children or animals, no part of the net earn-
ings of which inures to the benefit of any private shareholder or  indi-
vidual,  no  substantial  part of the activities of which is carrying on
propaganda, or otherwise attempting to influence legislation, (except as
otherwise provided in subsection (h) of section five hundred one of  the
United  States  internal revenue code of nineteen hundred fifty-four, as
amended), and which does not participate in, or intervene in  (including
the publishing or distributing of statements), any political campaign on
behalf of any candidate for public office[;].
  (5)  A  post  or  organization of past or present members of the armed
forces of the United States, or an auxiliary unit or society  of,  or  a
trust or foundation for, any such post or organization:
  (A) organized in this state,
  (B)  at least seventy-five percent of the members of which are past or
present members of the armed forces of the United States as  defined  in
section thirteen-a of the general construction law and substantially all
of  the  other  members  of  which are individuals who are cadets or are
spouses, widows, widowers, ancestors, or lineal descendants of  past  or
present  members  of the armed forces of the United States or of cadets,
and
  (C) no part of the net earnings of which inures to the benefit of  any
private shareholder or individual.
  (6) The following Indian nations or tribes residing in New York state:
Cayuga,  Oneida, Onondaga, Poospatuck, Saint Regis Mohawk, Seneca, Shin-
necock, Tonawanda and Tuscarora, where it  is  the  purchaser,  user  or
consumer.
  (7)  A  not-for-profit  corporation  operating as a health maintenance
organization subject to the provisions  of  article  forty-four  of  the
public health law.
  (8)  Cooperative and foreign corporations doing business in this state
pursuant to the rural electric cooperative law.
  (9) A credit union, as defined in subdivision nine of section  two  of
the  banking law, where it is the purchaser, user, or consumer, or where
it is a vendor of services or property of a kind not ordinarily sold  by
private persons.
  (10)  SENIOR  CITIZEN  ORGANIZATIONS  ORGANIZED  PURSUANT  TO  SECTION
501(C)(3) OR SECTION 501(C)(7) OF THE INTERNAL REVENUE CODE  (26  U.S.C.
S501)  WHICH  LIMIT MEMBERSHIP TO MEMBERS AGE FIFTY AND OLDER, AND WHICH
ARE ORGANIZED FOR PLEASURE,  SOCIAL,  EDUCATIONAL,  RECREATIONAL  AND/OR
OTHER NON-PROFIT PURPOSES, PROVIDED:
  (A)  NO  PART OF THE NET EARNINGS OF WHICH INURE TO THE BENEFIT OF ANY
PRIVATE SHAREHOLDER OR INDIVIDUAL;
  (B) NO SUBSTANTIAL PART OF THE ACTIVITIES  OF  WHICH  IS  CARRYING  ON
PROPAGANDA, OR OTHERWISE ATTEMPTING TO INFLUENCE LEGISLATION, (EXCEPT AS
OTHERWISE  PROVIDED IN SUBSECTION (H) OF SECTION FIVE HUNDRED ONE OF THE
UNITED STATES INTERNAL REVENUE CODE OF NINETEEN HUNDRED  FIFTY-FOUR,  AS
AMENDED),  AND WHICH DOES NOT PARTICIPATE IN, OR INTERVENE IN (INCLUDING

S. 6200                             3

THE PUBLISHING OR DISTRIBUTING OF STATEMENTS), ANY POLITICAL CAMPAIGN ON
BEHALF OF ANY CANDIDATE FOR PUBLIC OFFICE; AND
  (C)  THE  EXEMPTION  APPLIES  ONLY  TO  PURCHASES THAT ARE MADE BY THE
ORGANIZATION ITSELF AND NOT FOR PURCHASES BY ANY OF ITS MEMBERS INDIVID-
UALLY.
  S 2. Subdivision (g) of section 1116 of the tax  law,  as  amended  by
chapter 3 of the laws of 2004, is amended to read as follows:
  (g) For purposes of [paragraph] PARAGRAPHS five AND TEN of subdivision
(a) of this section, duly authorized representatives of any such post or
organization, while acting on behalf of such post or organization, shall
not be subject to the tax imposed under subdivision (e) of section elev-
en  hundred  five or the unit fee imposed by section eleven hundred four
of this article, provided that such representatives  provide  an  exempt
organization  certificate from such post or organization certifying that
such representative is acting on its behalf.
  S 3. The commissioner  of  taxation  and  finance  is  authorized  and
directed to develop and place into effect all rules and regulations, and
take  all  other measures necessary, to implement the provisions of this
act on or before its effective  date,  including,  but  not  limited  to
making all necessary changes to the "Application for an Exempt Organiza-
tion  Certificate"  (Form ST-119.2) and any other forms utilized by tax-
exempt entities.
  S 4. This act shall take effect January 1, 2015.

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Senate Bill S6200

Sponsored By

Archive: Last Bill Status - In Senate Committee Investigations And Government Operations Committee

2013-S6200 (ACTIVE) - Details

2013-S6200 (ACTIVE) - Summary

2013-S6200 (ACTIVE) - Sponsor Memo

2013-S6200 (ACTIVE) - Bill Text download pdf

Comments

Senate Bill S6200

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Sponsored By

Kathleen A. Marchione

Archive: Last Bill Status - In Senate Committee Investigations And Government Operations Committee

2013-S6200 (ACTIVE) - Details

2013-S6200 (ACTIVE) - Summary

2013-S6200 (ACTIVE) - Sponsor Memo

2013-S6200 (ACTIVE) - Bill Text download pdf

Comments