NY State Senate Bill 2017-S2038

Senate Bill S2038

2017-2018 Legislative Session

Establishes a childcare advance which enables certain taxpayers to defer payment of a portion of their tax liability

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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 11, 2017	referred to investigations and government operations

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2017-S2038 (ACTIVE) - Details

See other versions of this Bill:: A4943 ,; S7007 ,
Current Committee:: Senate Investigations And Government Operations
Law Section:: Tax Law
Laws Affected:: Add §608, Tax L
Versions Introduced in 2015-2016 Legislative Session:: S6714, A9699

2017-S2038 (ACTIVE) - Summary

Establishes a childcare advance which enables certain taxpayers to defer payment of a portion of their tax liability.

2017-S2038 (ACTIVE) - Sponsor Memo

                                 BILL NUMBER:  S2038

 TITLE OF BILL :

An act to amend the tax law, in relation to establishing a childcare
advance which enables certain taxpayers to defer payment of a portion
of their tax liability

 PURPOSE :

Establishes the Childcare Advance, a deferral of state taxes to help
families afford the costs of childcare.

 SUMMARY OF PROVISIONS :

New section 608 of the tax law establishes the Childcare Advance, a
deferral of state taxes to help families afford the costs of
childcare.

Section 608(a) permits resident taxpayers with eligible
"employment-related" expenses, as defined in Internal Revenue Code
("IRC") Section 21(b)(2) for care of a dependent under age 5 to defer
payment of their tax liability for that taxable year by the amount of
those expenses, but not to exceed two thousand dollars.

Section 608(b) provides for repayment of deferrals over a ten year

period commencing when the taxpayer is no longer taking the deferral,
and in all cases requires repayment of each year's deferral over a
ten-year period starting not later than five years after that
deferral. Repayment is to be made without interest.

Section 608(c) provides for repayment in cases where a taxpayer moves
to a residence outside New York which does not maintain tax
reciprocity with New York.

Section 608(d) provides for notice from the Department to taxpayers
who have taken the deferral established in Section (a) above of their
deferred liability, tax year in which repayment will begin, and an
estimate of the amount for which taxpayer will be liable once
eligibility expires.

Section 608(f) directs regulations to permit the repayment of
deferrals through tax withholding and to address repayment in cases of
divorce.

 JUSTIFICATION :

Childcare costs are one of the greatest expenses for families with
young children in New York State. New York families face some of the
highest childcare costs in the nation, including average annual costs
from $10,556 to $14,144 per year for an infant and $9,776 to $11,700
for a four-year-old.

Childcare costs exceed housing costs for many families and consume a
significant percentage of a family's income. And these costs come at a
critical time for families, when the care provided to children has the
greatest impact on their long-term development and when many young
families are just starting out and working to make other investments.

At the same time, affordable childcare is critical for working
families, and can have positive impacts on children's health and
long-term development and women's participation in the workforce,
among other benefits.

By allowing families to defer up to $2,000 of their state tax
liability each year while young children are in childcare, the
"Childcare Advance" would make childcare substantially more affordable
for thousands of New York families and result in millions per year in
savings and financial returns.

 LEGISLATIVE HISTORY :

2016: S6714/A9699 - REFERRED TO INVESTIGATIONS AND GOVERNMENT
OPERATIONS/referred to ways and means

 FISCAL IMPLICATIONS :

To be determined.

 EFFECTIVE DATE :
Tax year for the year in which the legislation becomes law.

2017-S2038 (ACTIVE) - Bill Text download pdf

                            
 
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   2038
 
                        2017-2018 Regular Sessions
 
                             I N  S E N A T E
 
                             January 11, 2017
                                ___________
 
 Introduced by Sens. SQUADRON, KENNEDY -- 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  a  childcare
   advance  which enables certain taxpayers to defer payment of a portion
   of their tax liability

   THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section  1. The tax law is amended by adding a new section 608 to read
 as follows:
   § 608. CHILDCARE ADVANCE. (A) ANY RESIDENT TAXPAYER WHO, IN A  TAXABLE
 YEAR,  HAS  "EMPLOYMENT  RELATED  EXPENSES"  AS  DEFINED IN THE INTERNAL
 REVENUE CODE SECTION 21(B)(2) FOR A DEPENDENT UNDER AGE FIVE  AND  WOULD
 BE  ELIGIBLE TO USE THOSE EXPENSES AS THE BASIS FOR CALCULATING A CREDIT
 UNDER INTERNAL REVENUE CODE SECTION 21 (WITHOUT REGARD  TO  WHETHER  THE
 TAXPAYER  IN FACT CLAIMED THE CREDIT UNDER SUCH SECTION FOR SUCH TAXABLE
 YEAR), MAY DEFER PAYMENT OF THEIR TAX LIABILITY FOR  THAT  TAXABLE  YEAR
 UNDER THIS ARTICLE BY THE AMOUNT OF THOSE EXPENSES BUT NOT TO EXCEED TWO
 THOUSAND DOLLARS.
   (B)  ANY  TAXPAYER  WHO  DEFERS TAX LIABILITY UNDER SUBDIVISION (A) OF
 THIS SECTION SHALL BE LIABLE: (I) ONCE THE TAXPAYER IS NO LONGER  TAKING
 THE DEFERRAL, FOR THE FULL AMOUNT PREVIOUSLY DEFERRED DIVIDED INTO EQUAL
 PAYMENTS  OVER  TEN  YEARS,  EXCEPT  THAT  (II)  IN ANY FUTURE YEARS THE
 TAXPAYER TAKES THE DEFERRAL, THAT TAXPAYER IS LIABLE ONLY FOR  ONE-TENTH
 OF  EACH  DEFERRAL  TAKEN  FIVE  OR MORE YEARS PRIOR UNTIL EACH OF THOSE
 DEFERRALS IS REPAID. AT NO  POINT  SHALL  THE  TAXPAYER  BE  LIABLE  FOR
 AMOUNTS PREVIOUSLY REPAID.  REPAYMENT SHALL BE MADE WITHOUT INTEREST.
   (C)  ANY  TAXPAYER  WHO  DEFERS TAX LIABILITY UNDER SUBDIVISION (A) OF
 THIS SECTION, AND WHO MOVES TO A RESIDENCE OUTSIDE THE STATE OF NEW YORK
 IN A STATE, TERRITORY OR COUNTRY WHICH DOES NOT MAINTAIN  EFFECTIVE  AND
 APPLICABLE  RECIPROCITY  WITH THE STATE OF NEW YORK, SHALL BE LIABLE FOR
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.

                                                            LBD00452-01-7

 S. 2038                             2
 
 THE ENTIRE AMOUNT DEFERRED ON THE TAX FILING FOR THE TAX YEAR  IN  WHICH
 SUCH  CHANGE OF RESIDENCE OCCURS, BUT SUBJECT TO APPROVAL OF THE DEPART-
 MENT SHALL BE DIRECTED TO REPAY THAT LIABILITY THROUGH  A  PAYMENT  PLAN
 APPROVED BY THE DEPARTMENT.
   (D)  AT  THE  END  OF EVERY TAX YEAR, THE DEPARTMENT SHALL NOTIFY EACH
 TAXPAYER WHO HAS DEFERRED TAX LIABILITY UNDER SUBDIVISION  (A)  OF  THIS
 SECTION OF THE TOTAL AMOUNT OF THEIR DEFERRED LIABILITY, THE TAX YEAR IN
 WHICH  REPAYMENT WILL BEGIN, AND AN ESTIMATE OF THE AMOUNT FOR WHICH THE
 TAXPAYER WILL BE LIABLE EACH YEAR ONCE THE ELIGIBILITY EXPIRES.
   (E) NOTHING IN THIS SECTION SHALL PREVENT  A  TAXPAYER  FROM  REPAYING
 ACCUMULATED LIABILITY EARLIER THAN THE SCHEDULE SET FORTH IN SUBDIVISION
 (B)  OF  THIS  SECTION,  OR  TAKING LESS THAN THE TOTAL AMOUNT ALLOWABLE
 UNDER SUBDIVISION (A) OF THIS SECTION IN ANY GIVEN TAX YEAR.
   (F) THE DEPARTMENT MAY PROVIDE FOR THE REPAYMENT  OF  DEFERRALS  UNDER
 THIS  SECTION  TO BE MADE THROUGH PAYROLL WITHHOLDING IN ACCORDANCE WITH
 SECTION SIX HUNDRED SEVENTY-ONE  OF  THIS  ARTICLE,  AND  SHALL  ADDRESS
 REPAYMENT IN CASES OF DIVORCE.
   §  2.  This  act  shall take effect immediately and shall be deemed to
 have been in full force and effect on and after  January  first  of  the
 calendar  year  in  which  it  takes effect and shall apply to tax years
 commencing on and after such date.

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Senate Bill S2038

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Daniel L. Squadron