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

                                 3110--A

                       2015-2016 Regular Sessions

                            I N  S E N A T E

                            February 2, 2015
                               ___________

Introduced  by  Sens. KRUEGER, HASSELL-THOMPSON, MONTGOMERY, SQUADRON --
  read twice and ordered printed, and when printed to  be  committed  to
  the Committee on Investigations and Government Operations -- recommit-
  ted  to  the  Committee on Investigations and Government Operations in
  accordance with Senate Rule 6, sec. 8 --  committee  discharged,  bill
  amended,  ordered reprinted as amended and recommitted to said commit-
  tee

AN ACT to amend the tax law, in relation to creating  the  middle  class
  circuit breaker tax credit and creating a tax reform study commission

  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 (ccc) to read as follows:
  (CCC)  MIDDLE  CLASS  CIRCUIT BREAKER CREDIT. (1) DEFINITIONS. FOR THE
PURPOSES OF THIS SUBSECTION:
  (A) "QUALIFIED TAXPAYER" MEANS A RESIDENT INDIVIDUAL OF THE STATE  WHO
OWNS  OR RENTS THE RESIDENTIAL REAL PROPERTY IN WHICH HE OR SHE RESIDES,
AND HAS RESIDED IN SUCH RESIDENTIAL REAL PROPERTY FOR NOT LESS THAN FIVE
YEARS.
  (B) "HOUSEHOLD" OR  "MEMBERS  OF  THE  HOUSEHOLD"  MEANS  A  QUALIFIED
TAXPAYER  OR  QUALIFIED TAXPAYERS AND ALL OTHER PERSONS, NOT NECESSARILY
RELATED, WHO ALL RESIDE IN THE RESIDENTIAL REAL PROPERTY  OWNED  BY  THE
TAXPAYER  OR TAXPAYERS, AND SHARE ITS FURNISHINGS, FACILITIES AND ACCOM-
MODATIONS; PROVIDED THAT NO PERSON MAY BE A  MEMBER  OF  MORE  THAN  ONE
HOUSEHOLD AT ONE TIME.
  (C) "HOUSEHOLD GROSS INCOME" MEANS THE AGGREGATE ADJUSTED GROSS INCOME
OF  ALL  MEMBERS  OF  THE HOUSEHOLD FOR THE TAXABLE YEAR AS REPORTED FOR
FEDERAL INCOME TAX PURPOSES, OR WHICH  WOULD  BE  REPORTED  AS  ADJUSTED
GROSS  INCOME  IF A FEDERAL INCOME TAX RETURN WERE REQUIRED TO BE FILED,
WITH THE MODIFICATIONS IN SUBSECTION (B) OF SECTION SIX  HUNDRED  TWELVE
OF  THIS ARTICLE BUT WITHOUT THE MODIFICATIONS IN SUBSECTION (C) OF SUCH

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD05460-02-6
              

S. 3110--A                          2

SECTION, PLUS ANY PORTION OF THE GAIN FROM THE SALE OR EXCHANGE OF PROP-
ERTY OTHERWISE EXCLUDED FROM SUCH AMOUNT;  EARNED  INCOME  FROM  SOURCES
WITHOUT  THE  UNITED  STATES  EXCLUDABLE  FROM  FEDERAL  GROSS INCOME BY
SECTION  NINE HUNDRED ELEVEN OF THE INTERNAL REVENUE CODE; SUPPORT MONEY
NOT INCLUDED IN  ADJUSTED  GROSS  INCOME;  NONTAXABLE  STRIKE  BENEFITS;
SUPPLEMENTAL  SECURITY  INCOME PAYMENTS; THE GROSS AMOUNT OF ANY PENSION
OR ANNUITY BENEFITS TO THE EXTENT NOT INCLUDED IN  SUCH  ADJUSTED  GROSS
INCOME  (INCLUDING, BUT NOT LIMITED TO, RAILROAD RETIREMENT BENEFITS AND
ALL PAYMENTS RECEIVED UNDER THE FEDERAL SOCIAL SECURITY ACT  AND  VETER-
ANS'  DISABILITY  PENSIONS); NONTAXABLE INTEREST RECEIVED FROM THE STATE
OF NEW YORK, ITS AGENCIES, INSTRUMENTALITIES,  PUBLIC  CORPORATIONS,  OR
POLITICAL  SUBDIVISIONS (INCLUDING A PUBLIC CORPORATION CREATED PURSUANT
TO AGREEMENT OR COMPACT WITH ANOTHER STATE OR CANADA); WORKERS'  COMPEN-
SATION;  THE GROSS AMOUNT OF "LOSS-OF-TIME" INSURANCE; AND THE AMOUNT OF
CASH PUBLIC ASSISTANCE AND RELIEF, OTHER THAN MEDICAL ASSISTANCE FOR THE
NEEDY, PAID TO OR FOR THE BENEFIT OF THE QUALIFIED TAXPAYER  OR  MEMBERS
OF  HIS  OR  HER  HOUSEHOLD.  HOUSEHOLD GROSS INCOME SHALL   NOT INCLUDE
SURPLUS FOODS OR OTHER RELIEF IN KIND OR PAYMENTS  MADE  TO  INDIVIDUALS
BECAUSE  OF  THEIR  STATUS  AS VICTIMS OF NAZI PERSECUTION AS DEFINED IN
PUBLIC LAW 103-286 OR ANY DISABILITY COMPENSATION RECEIVED  BY  VETERANS
ON  ACCOUNT  OF INJURY OR ILLNESS INCURRED OR AGGRAVATED DURING MILITARY
SERVICE IN THE WARS IN AFGHANISTAN AND IRAQ  SINCE  SEPTEMBER  ELEVENTH,
TWO  THOUSAND ONE.  PROVIDED, FURTHER, HOUSEHOLD GROSS INCOME SHALL ONLY
INCLUDE ALL SUCH INCOME RECEIVED BY ALL MEMBERS OF THE  HOUSEHOLD  WHILE
MEMBERS OF SUCH HOUSEHOLD.
  (D)  "ADJUSTED  RENT"  MEANS RENT PAID FOR THE RIGHT OF OCCUPANCY OF A
RESIDENCE.
  (E) "REAL PROPERTY TAX EQUIVALENT" MEANS (1) FOR TAXABLE YEARS  BEGIN-
NING  IN  TWO  THOUSAND  SEVENTEEN, FIFTEEN PERCENT OF THE ADJUSTED RENT
ACTUALLY PAID IN THE TAXABLE YEAR BY A HOUSEHOLD SOLELY FOR THE RIGHT OF
OCCUPANCY OF ITS NEW YORK RESIDENCE FOR THE TAXABLE YEAR. IF (I) A RESI-
DENCE IS RENTED TO TWO OR MORE INDIVIDUALS AS COTENANTS, OR  SUCH  INDI-
VIDUALS SHARE IN THE PAYMENT OF A SINGLE RENT FOR THE RIGHT OF OCCUPANCY
OF  SUCH RESIDENCE, AND (II) EACH OF SUCH INDIVIDUALS  IS A MEMBER OF  A
DIFFERENT HOUSEHOLD, ONE OR MORE OF WHICH INDIVIDUALS SHARES SUCH  RESI-
DENCE,  REAL  PROPERTY TAX EQUIVALENT IS THAT PORTION OF FIFTEEN PERCENT
OF THE ADJUSTED RENT PAID  IN  THE  TAXABLE  YEAR  WHICH  REFLECTS  THAT
PORTION  OF  THE  RENT  ATTRIBUTABLE  TO  THE QUALIFIED TAXPAYER AND THE
MEMBERS OF HIS OR HER HOUSEHOLD; AND (2) FOR TAXABLE YEARS BEGINNING  IN
TWO  THOUSAND  NINETEEN  AND  THEREAFTER, TWENTY PERCENT OF THE ADJUSTED
RENT ACTUALLY PAID IN THE TAXABLE YEAR  BY A HOUSEHOLD  SOLELY  FOR  THE
RIGHT  OF  OCCUPANCY  OF ITS NEW YORK RESIDENCE FOR THE TAXABLE YEAR. IF
(I) A RESIDENCE IS RENTED TO TWO OR MORE INDIVIDUALS  AS  COTENANTS,  OR
SUCH  INDIVIDUALS SHARE IN THE PAYMENT OF A SINGLE RENT FOR THE RIGHT OF
OCCUPANCY OF SUCH RESIDENCE, AND (II) EACH  OF  SUCH  INDIVIDUALS  IS  A
MEMBER OF A DIFFERENT HOUSEHOLD, ONE OR MORE OF WHICH INDIVIDUALS SHARES
SUCH  RESIDENCE,  REAL PROPERTY TAX EQUIVALENT IS THAT PORTION OF TWENTY
PERCENT OF THE ADJUSTED RENT PAID IN THE  TAXABLE  YEAR  WHICH  REFLECTS
THAT  PORTION OF THE RENT ATTRIBUTABLE TO THE QUALIFIED TAXPAYER AND THE
MEMBERS OF HIS OR HER HOUSEHOLD.
  (F) "NET REAL PROPERTY TAX" MEANS THE REAL PROPERTY TAXES ASSESSED  ON
THE  RESIDENTIAL  REAL  PROPERTY  OWNED  AND OCCUPIED BY THE TAXPAYER OR
TAXPAYERS AFTER ANY EXEMPTION OR ABATEMENT RECEIVED PURSUANT TO THE REAL
PROPERTY TAX LAW.
  (2) CREDIT. A QUALIFIED TAXPAYER SHALL BE ALLOWED A CREDIT AGAINST THE
TAXES IMPOSED BY THIS ARTICLE, EQUAL TO SEVENTY PERCENT OF THE AMOUNT BY

S. 3110--A                          3

WHICH THE TAXPAYER'S NET REAL PROPERTY TAX OR THE TAXPAYER'S REAL  PROP-
ERTY TAX EQUIVALENT EXCEEDS THE TAXPAYER'S MAXIMUM REAL PROPERTY TAX, AS
DETERMINED BY PARAGRAPH THREE OF THIS SUBSECTION. IF SUCH CREDIT EXCEEDS
THE TAX FOR SUCH TAXABLE YEAR, AS REDUCED BY THE OTHER CREDITS PERMITTED
BY  THIS  ARTICLE,  THE  QUALIFIED  TAXPAYER  MAY RECEIVE, AND THE COMP-
TROLLER, SUBJECT TO A CERTIFICATE OF THE DEPARTMENT,  SHALL  PAY  AS  AN
OVERPAYMENT, WITHOUT INTEREST, ANY EXCESS BETWEEN SUCH TAX AS SO REDUCED
AND THE AMOUNT OF THE CREDIT. IF A QUALIFIED TAXPAYER IS NOT REQUIRED TO
FILE A RETURN PURSUANT TO SECTION SIX HUNDRED FIFTY-ONE OF THIS ARTICLE,
A  QUALIFIED  TAXPAYER  MAY  NEVERTHELESS  RECEIVE  AND THE COMPTROLLER,
SUBJECT TO A CERTIFICATE OF THE DEPARTMENT, SHALL PAY AS AN  OVERPAYMENT
THE FULL AMOUNT OF THE CREDIT, WITHOUT INTEREST.
  (3) MAXIMUM REAL PROPERTY TAX. (A) A QUALIFIED TAXPAYER'S MAXIMUM REAL
PROPERTY TAX SHALL BE DETERMINED AS FOLLOWS:
  (I) FOR TAX YEARS BEGINNING IN TWO THOUSAND SEVENTEEN:
HOUSEHOLD GROSS INCOME               MAXIMUM REAL PROPERTY TAX
ONE HUNDRED THOUSAND                 NINE PERCENT OF THE
DOLLARS OR LESS                      HOUSEHOLD GROSS INCOME
MORE THAN ONE HUNDRED                NO LIMITATION.
THOUSAND DOLLARS

  (II) FOR TAX YEARS BEGINNING IN TWO THOUSAND EIGHTEEN:
HOUSEHOLD GROSS INCOME               MAXIMUM REAL PROPERTY TAX
ONE HUNDRED THOUSAND                 EIGHT AND ONE-HALF PERCENT OF THE
DOLLARS OR LESS                      HOUSEHOLD GROSS INCOME
MORE THAN ONE HUNDRED                NO LIMITATION.
THOUSAND DOLLARS

  (III) FOR TAX YEARS BEGINNING IN TWO THOUSAND NINETEEN:
HOUSEHOLD GROSS INCOME               MAXIMUM REAL PROPERTY TAX
ONE HUNDRED THOUSAND DOLLARS         SEVEN AND ONE-HALF PERCENT OF
OR LESS                              HOUSEHOLD GROSS INCOME
MORE THAN ONE HUNDRED THOUSAND       SEVEN AND ONE-HALF PERCENT OF
DOLLARS, BUT LESS THAN OR EQUAL TO   ONE HUNDRED THOUSAND DOLLARS
ONE HUNDRED FIFTY THOUSAND DOLLARS   PLUS EIGHT AND ONE-HALF PERCENT OF
                                     HOUSEHOLD GROSS INCOME ABOVE
                                     ONE HUNDRED THOUSAND DOLLARS
MORE THAN ONE HUNDRED FIFTY          NO LIMITATION.
THOUSAND DOLLARS

  (IV) FOR TAX YEARS BEGINNING IN TWO THOUSAND TWENTY AND THEREAFTER:
HOUSEHOLD GROSS INCOME               MAXIMUM REAL PROPERTY TAX
ONE HUNDRED THOUSAND                 SIX PERCENT OF HOUSEHOLD GROSS
DOLLARS OR LESS                      INCOME
MORE THAN ONE HUNDRED THOUSAND       SIX PERCENT OF ONE HUNDRED
DOLLARS, BUT LESS THAN OR EQUAL TO   THOUSAND DOLLARS PLUS SEVEN
ONE HUNDRED FIFTY THOUSAND DOLLARS   PERCENT OF HOUSEHOLD GROSS INCOME
                                     ABOVE ONE HUNDRED THOUSAND DOLLARS
MORE THAN ONE HUNDRED FIFTY          SIX PERCENT OF ONE HUNDRED THOUSAND
THOUSAND DOLLARS, BUT LESS THAN      DOLLARS PLUS SEVEN
OR EQUAL TO TWO HUNDRED FIFTY        PERCENT OF FIFTY THOUSAND DOLLARS
THOUSAND DOLLARS                     PLUS EIGHT AND ONE-HALF PERCENT OF
                                     HOUSEHOLD GROSS INCOME ABOVE ONE
                                     HUNDRED FIFTY THOUSAND DOLLARS
MORE THAN TWO HUNDRED FIFTY          NO LIMITATION.
THOUSAND DOLLARS

S. 3110--A                          4

  (B)  THE  THRESHOLDS  OF  HOUSEHOLD GROSS INCOME ESTABLISHED BY CLAUSE
(IV) OF  SUBPARAGRAPH  (A)  OF  THIS  PARAGRAPH  SHALL  BE  INDEXED  FOR
INFLATION  FOR TAX YEARS BEGINNING IN TWO THOUSAND TWENTY-ONE AND THERE-
AFTER.
  (4) EXCLUSIONS FROM ELIGIBILITY. NO CREDIT SHALL BE GRANTED UNDER THIS
SUBSECTION  IF  THE  QUALIFIED  TAXPAYER  CLAIMS  THE  REAL PROPERTY TAX
CIRCUIT BREAKER CREDIT, PURSUANT TO  SUBSECTION  (E)  OF  THIS  SECTION,
DURING THE TAXABLE YEAR.
  S  2.  There  is  hereby  established a tax reform study commission to
provide the governor and the  legislature  with  a  long  run  plan  for
reforming  the state and local tax systems. The tax reform study commis-
sion shall consist of five  members  appointed  by  the  governor,  four
members  each appointed by the speaker of the assembly and the temporary
president of the senate, and one member each appointed by  the  minority
leader  of  the senate and the minority leader of the assembly. In addi-
tion, on or before January 1, 2019,  the  tax  reform  study  commission
shall  provide  the governor and the legislature with recommendations on
any changes that should be made in the definitions of income used in the
various property tax relief programs authorized by the laws of the state
of New York. Such recommendations shall be based on  an  examination  of
such  laws and of such laws in other states. In preparing such recommen-
dations, the tax reform study commission shall review the distributional
impact of the items of income included in the  definition  of  household
income for purposes of the circuit breaker and other property tax relief
programs established by state law and make recommendations to the gover-
nor and the legislature for any changes in any of these definitions that
the  tax  reform study commission deems appropriate. The commissioner of
taxation and finance and the director of the  office  of  real  property
services  shall  provide  the tax reform study commission with such data
and analysis as it may require.
  S 3. This act shall take effect immediately.