NY State Senate Bill 2017-S4618A

Senate Bill S4618A

2017-2018 Legislative Session

Establishes business franchise, personal income and insurance franchise tax credits for the expenses of employer provided or sponsored child care

download bill text pdf

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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Actions

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	Assembly Actions - Lowercase Senate Actions - UPPERCASE
Jan 03, 2018	referred to investigations and government operations
Jun 16, 2017	print number 4618a
Jun 16, 2017	amend and recommit to finance
Apr 25, 2017	reported and committed to finance
Feb 22, 2017	referred to investigations and government operations

Votes

- Apr 25, 2017 - Investigations And Government Operations Committee Vote
  S4618A
  
  5
  
  Aye
  
  2
  
  Nay
  
  2
  
  Aye with Reservations
  
  0
  
  Absent
  
  0
  
  Excused
  
  0
  
  Abstained
  - - Investigations And Government Operations Committee Vote: Apr 25, 2017
      
      aye (5)
      
      Carlucci
      
      Diaz
      
      Golden
      
      O'Mara
      
      Squadron
      
      nay (2)
      
      Lanza
      
      Murphy
      
      aye wr (2)
      
      Hoylman-Sigal
      
      Phillips

Bill Amendments

Original

A (Active)

2017-S4618 - Details

Current Committee:: Senate Investigations And Government Operations
Law Section:: Tax Law
Laws Affected:: Add §44, amd §§210-B, 606 & 1511, Tax L
Versions Introduced in Other Legislative Sessions:: 2019-2020: S8943
2021-2022: S2609
2023-2024: S3447

2017-S4618 - Summary

Establishes business franchise, personal income and insurance franchise tax credits for the expenses of employer provided or sponsored child care.

2017-S4618 - Sponsor Memo

                                 BILL NUMBER:  S4618

 TITLE OF BILL :  An act to amend the tax law, in relation to
establishing business franchise, personal income and insurance
franchise tax credits for employer provided or sponsored child care

 PURPOSE :

This bill creates a new child care tax credit for businesses that will
support businesses' child care operating and capital expenses while
incentivizing employers to provide child care for their employees.

 SUMMARY OF PROVISIONS :

Section 1: Provides various definitions. Delineates between employer
sponsored care (care that is paid by the employer and contracted out
to third party providers), and employer provided care (care the
employer provides on premises at their own facilities).

For capital costs, the employer may claim a tax credit equal to 100%
of capital costs for on premises child care facilities for
construction or acquisition of child care facilities on or after
January 1, 2018. The employer may either spread the capital costs over
a period of ten years after the child care costs are placed in
service, or may alternatively claim all of the capital costs during
the year in which the child care facility is placed in service.

Mandates that any facility receiving tax credits must be licensed by
the Office of Children and Family Services or the Department of Health
and Mental Hygiene in New York City. Ninety-five percent of the
children who use the facility must be children of employees of the
employer receiving the credit.

The capital costs credit may not exceed fifty percent of an employer's
tax liability in any given year.

Provides that the capital costs of constructing a child care facility
will be recaptured by the state if the facility is taken out of
service within fourteen years. Each year later within that period
would result in a lower recapture amount.

In years that the employer claims the capital expenses credit, the
employer must send the department information relating to the facility
for which the credit is claimed, in addition to any information
concerning a recapture of the property.

Provides that employers may take a seventy-five percent tax credit for
employer sponsored care or employer provided care.

The tax credit will be capped at fifty percent of the employer's tax
liability for a taxable year, but a credit can be carried forward up
to five taxable years.

Employers must report to the department of taxation and finance: the
names of the employees served, the name of the child care provider,
the number of children served by care subsidized via the tax credit,
the number of children excluded from care, and any other information
the department requires to ensure that the credits are only granted to
employers who provide or sponsor approved child care.

The tax credit cannot apply to families whose annual household income
exceeds two-hundred thousand dollars; employers must itemize those
families out of any credit claimed.

In the case of employer sponsored care, the average credit claimed per
child served by the employer may not exceed the market rate per child
established by OCFS for the social services district within which
child care is provided.

Section 2: Tax law cross-references to ensure the tax credit applies
to all qualified businesses operating in New York State.

Section 3: Tax law cross-references to ensure the tax credit applies
to all qualified businesses operating in New York State.

Section 4: Tax law cross-references to ensure the tax credit applies
to all qualified businesses operating in New York State.

Section 5: Tax law cross-references to ensure the tax credit applies
to all qualified businesses operating in New York State.

Section 6: The act shall take effect immediately.

 EXISTING LAW :

Under current law, New York does not provide a business child care tax
credit. The federal government currently provides a 25% tax credit for
child care operating expenses.

 JUSTIFICATION :

The cost for child care in New York State is now among the highest of
any state. At around $10,400 per year per infant, and over $9,000 per
toddler, child care costs have reached such heights that New York's
working families can often no longer afford safe, regulated child care
without substantial support from the state through subsidy programs.
Due to oversubscription in the child care subsidy system, many
families do not have access to subsidies. The alternatives available
to these families who cannot afford care are grim: either leave their
jobs to care for the children, and forego income and spending power,
or try to find an unregulated, unlicensed, potentially dangerous
provider that offers services for a cheaper price.

A lack of affordable child care is dangerous for children, financially
harmful to families (either as a result of pressure on their budgets
to pay for care, or forcing them to leave their jobs), and has
detrimental effects on New York's economy. Less families working
results in less economic activity, reduced spending, and potentially
more stress on social programs to support these families.

Employer sponsored or provided child care has the potential to provide
multiple benefits to New York's families, businesses, and economy: it
can provide employers with a valuable recruitment perk and benefit for
existing and potential employees; it can make it easy for employees to
find safe, reliable child care without searching around at child cares
that may not have any slots available; it can keep children close to
their parents so daily commutes are easier; it can reduce the burden
on the child care subsidy system by freeing up slots for more
children; and it will ensure more families have access to reliable,
stable, and safe care so that they can retain their jobs.

New York's working families do not have adequate access to child care.
Incentivizing businesses to build more child care facilities and to
provide care to their employees' children is one potential avenue to
address the rising costs and increasingly limited availability of
regulated child care.

 LEGISLATIVE HISTORY :

This is a new bill.

 FISCAL IMPLICATIONS :
To be determined.

 LOCAL FISCAL IMPLICATIONS :

None.

2017-S4618 - Bill Text download pdf

                            
 
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   4618
 
                        2017-2018 Regular Sessions
 
                             I N  S E N A T E
 
                             February 22, 2017
                                ___________
 
 Introduced  by Sen. HAMILTON -- 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 establishing business  fran-
   chise, personal income and insurance franchise tax credits for employ-
   er provided or sponsored child care

   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 43  to  read
 as follows:
   §  43. EMPLOYER PROVIDED OR SPONSORED CHILD CARE. (A) DEFINITIONS. FOR
 THE PURPOSES OF THIS SECTION, THE FOLLOWING TERMS SHALL HAVE THE FOLLOW-
 ING MEANINGS:
   (1) "COST OF OPERATION" MEANS ANY REASONABLE DIRECT OPERATIONAL  COSTS
 INCURRED  BY  AN  EMPLOYER AS A RESULT OF PROVIDING EMPLOYER PROVIDED OR
 EMPLOYER SPONSORED CHILD CARE FACILITIES; PROVIDED, HOWEVER,  THAT  SUCH
 TERM SHALL EXCLUDE THE COST OF ANY PROPERTY THAT IS QUALIFIED CHILD CARE
 PROPERTY.
   (2) "EMPLOYER" MEANS A TAXPAYER WHO IS AN EMPLOYER UPON WHOM TAXES ARE
 IMPOSED  PURSUANT  TO ARTICLE NINE-A, TWENTY-TWO OR THIRTY-THREE OF THIS
 CHAPTER.
   (3) "EMPLOYER PROVIDED" MEANS CHILD CARE OFFERED ON THE PREMISES OF AN
 EMPLOYER.
   (4) "EMPLOYER SPONSORED" MEANS A CONTRACTUAL ARRANGEMENT WITH A  CHILD
 CARE FACILITY THAT IS PAID FOR BY AN EMPLOYER.
   (5)  "PREMISES  OF  THE  EMPLOYER"  MEANS  A  WORKPLACE PREMISES OF AN
 EMPLOYER, WITHIN THE STATE, PROVIDING THE CHILD CARE, OR BY ONE EMPLOYER
 PROVIDING THE CHILD CARE IN THE EVENT THAT THE CHILD  CARE  PROPERTY  IS
 OWNED  JOINTLY  OR SEVERALLY BY SUCH EMPLOYER AND ONE OR MORE EMPLOYERS;
 PROVIDED, HOWEVER, THAT IF SUCH WORKPLACE PREMISES ARE IMPRACTICABLE  OR
 OTHERWISE  UNSUITABLE FOR THE ON-SITE LOCATION OF A CHILD CARE FACILITY,

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

                                                            LBD08283-01-7

 S. 4618                             2
 
 AS DETERMINED BY THE OFFICE OF  CHILDREN  AND  FAMILY  SERVICES,  OR  IN
 CITIES  OF ONE MILLION OR MORE, THE CITY DEPARTMENT OF HEALTH AND MENTAL
 HYGIENE, SUCH FACILITY MAY BE LOCATED WITHIN A  REASONABLE  DISTANCE  OF
 THE PREMISES OF THE EMPLOYER.
   (6)  "QUALIFIED  CHILD CARE PROPERTY" INCLUDES, BUT IS NOT LIMITED TO,
 AMOUNTS EXPENDED  ON  LAND  ACQUISITION,  IMPROVEMENTS,  BUILDINGS,  AND
 BUILDING  IMPROVEMENTS AND FURNITURE, FIXTURES, AND EQUIPMENT, AND MEANS
 ALL REAL PROPERTY AND TANGIBLE PERSONAL PROPERTY PURCHASED  OR  ACQUIRED
 ON  OR  AFTER JANUARY FIRST, TWO THOUSAND EIGHTEEN, OR WHICH PROPERTY IS
 FIRST PLACED IN SERVICE ON OR AFTER JANUARY FIRST,  TWO  THOUSAND  EIGH-
 TEEN, FOR USE EXCLUSIVELY IN THE CONSTRUCTION, EXPANSION, IMPROVEMENT OR
 OPERATION OF AN EMPLOYER PROVIDED CHILD CARE FACILITY, BUT ONLY IF:
   (A) THE FACILITY IS LICENSED OR COMMISSIONED BY THE OFFICE OF CHILDREN
 SERVICES PURSUANT TO SECTION THREE HUNDRED NINETY OF THE SOCIAL SERVICES
 LAW,  OR IN CITIES OF ONE MILLION OR MORE, THE CITY DEPARTMENT OF HEALTH
 AND MENTAL HYGIENE PURSUANT TO ARTICLE FORTY-SEVEN OF THE HEALTH CODE OF
 THE CITY OF NEW YORK.
   (B) AT LEAST NINETY-FIVE PERCENT OF THE CHILDREN WHO USE THE  FACILITY
 ARE CHILDREN OF EMPLOYEES OF:
   (I)  THE EMPLOYER AND OTHER EMPLOYERS IN THE EVENT THAT THE CHILD CARE
 PROPERTY IS OWNED JOINTLY OR SEVERALLY BY THE EMPLOYER AND ONE  OR  MORE
 OTHER EMPLOYERS; OR
   (II)  A  CORPORATION  THAT  IS  A MEMBER OF THE TAXPAYER'S "AFFILIATED
 GROUP" WITHIN THE MEANING OF SECTION 1504(A)  OF  THE  INTERNAL  REVENUE
 CODE.
   (C)  THE  EMPLOYER  HAS  NOT PREVIOUSLY CLAIMED ANY TAX CREDIT FOR THE
 COST OF OPERATION FOR SUCH  QUALIFIED  CHILD  CARE  PROPERTY  PLACED  IN
 SERVICE  PRIOR TO TAXABLE YEARS BEGINNING ON OR AFTER JANUARY FIRST, TWO
 THOUSAND EIGHTEEN.
   (7) "RECAPTURE AMOUNT" MEANS, WITH RESPECT TO PROPERTY AS TO  WHICH  A
 RECAPTURE  EVENT  HAS OCCURRED, AN AMOUNT EQUAL TO THE APPLICABLE RECAP-
 TURE PERCENTAGE OF THE AGGREGATE CREDITS CLAIMED UNDER SUBDIVISION  FOUR
 OF  THIS  SECTION  FOR  ALL  TAXABLE YEARS PRECEDING THE RECAPTURE YEAR,
 WHETHER OR NOT SUCH CREDITS WERE USED.
   (8) "RECAPTURE EVENT" MEANS ANY DISPOSITION OF  QUALIFIED  CHILD  CARE
 PROPERTY  BY AN EMPLOYER, OR ANY OTHER EVENT OR CIRCUMSTANCE UNDER WHICH
 PROPERTY CEASES TO BE QUALIFIED CHILD CARE PROPERTY WITH RESPECT TO  THE
 EMPLOYER, EXCEPT FOR:
   (A) ANY TRANSFER BY REASON OF DEATH;
   (B) ANY TRANSFER BETWEEN SPOUSES OR INCIDENT TO DIVORCE;
   (C)  ANY  TRANSACTION  TO WHICH SECTION 381(A) OF THE INTERNAL REVENUE
 CODE APPLIES;
   (D) ANY CHANGE IN THE FORM OF CONDUCTING THE EMPLOYER'S TRADE OR BUSI-
 NESS SO LONG AS THE PROPERTY IS RETAINED IN SUCH TRADE  OR  BUSINESS  AS
 QUALIFIED  CHILD  CARE  PROPERTY  AND THE EMPLOYER RETAINS A SUBSTANTIAL
 INTEREST IN SUCH TRADE OR BUSINESS; OR
   (E) ANY ACCIDENT OR CASUALTY.
   (9) "RECAPTURE PERCENTAGE" MEANS THE APPLICABLE PERCENTAGE AS FOLLOWS:
 
 IF THE RECAPTURE EVENT OCCURS             PERCENTAGE
 
 FIVE FULL YEARS AFTER THE                 ONE HUNDRED PERCENT
 QUALIFIED CHILD CARE PROPERTY
 IS PLACED IN SERVICE
 
 THE SIXTH FULL YEAR AFTER THE             NINETY PERCENT

 S. 4618                             3

 QUALIFIED CHILD CARE PROPERTY
 IS PLACED IN SERVICE
 
 THE SEVENTH FULL YEAR AFTER THE           EIGHTY PERCENT
 QUALIFIED CHILD CARE PROPERTY
 IS PLACED IN SERVICE
 
 THE EIGHTH FULL YEAR AFTER THE            SEVENTY PERCENT
 QUALIFIED CHILD CARE PROPERTY
 IS PLACED IN SERVICE
 
 THE NINTH FULL YEAR AFTER THE             SIXTY PERCENT
 QUALIFIED CHILD CARE PROPERTY
 IS PLACED IN SERVICE
 
 THE TENTH FULL YEAR AFTER THE             FIFTY PERCENT
 QUALIFIED CHILD CARE PROPERTY
 IS PLACED IN SERVICE
 
 THE ELEVENTH FULL YEAR AFTER              FORTY PERCENT
 THE QUALIFIED CHILD CARE PROPERTY
 IS PLACED IN SERVICE
 
 THE TWELFTH FULL YEAR AFTER THE           THIRTY PERCENT
 QUALIFIED CHILD CARE PROPERTY
 IS PLACED IN SERVICE
 
 THE THIRTEENTH FULL YEAR AFTER            TWENTY PERCENT
 THE QUALIFIED CHILD CARE PROPERTY
 IS PLACED IN SERVICE
 
 THE FOURTEENTH FULL YEAR AFTER            TEN PERCENT
 THE QUALIFIED CHILD CARE PROPERTY
 IS PLACED IN SERVICE
 
 ANY PERIOD AFTER THE CLOSE OF             ZERO PERCENT
 THE FOURTEENTH FULL YEAR AFTER
 THE QUALIFIED CHILD CARE PROPERTY
 IS PLACED IN SERVICE

   (10)  "RECAPTURE  YEAR"  MEANS  THE  TAXABLE YEAR IN WHICH A RECAPTURE
 EVENT OCCURS WITH RESPECT TO QUALIFIED CHILD CARE PROPERTY.
   (B) ALLOWANCE OF CREDIT. A TAX CREDIT AGAINST THE TAXES IMPOSED PURSU-
 ANT TO ARTICLES NINE-A, TWENTY-TWO  AND  THIRTY-THREE  OF  THIS  CHAPTER
 SHALL  BE GRANTED TO AN EMPLOYER WHO PROVIDES OR SPONSORS CHILD CARE FOR
 EMPLOYEES. SUCH TAX CREDIT SHALL BE IN AN AMOUNT EQUAL  TO  SEVENTY-FIVE
 PERCENT  OF  THE  COST  OF  OPERATION INCURRED BY THE EMPLOYER, LESS ANY
 AMOUNTS PAID BY EMPLOYEES DURING THE TAXABLE YEAR.
   (C) CONDITIONS AND LIMITATIONS. THE TAX CREDIT ALLOWED UNDER  SUBDIVI-
 SION  (B)  OF  THIS SECTION SHALL BE SUBJECT TO THE FOLLOWING CONDITIONS
 AND LIMITATIONS:
   (1) SUCH CREDIT SHALL NOT EXCEED FIFTY PERCENT OF THE  AMOUNT  OF  THE
 EMPLOYER'S TAX LIABILITY FOR THE TAXABLE YEAR AS COMPUTED WITHOUT REGARD
 TO ANY OTHER CREDITS;

 S. 4618                             4
 
   (2)  ANY  SUCH  CREDIT CLAIMED BUT NOT USED IN ANY TAXABLE YEAR MAY BE
 CARRIED FORWARD FOR FIVE YEARS FROM THE CLOSE OF  THE  TAXABLE  YEAR  IN
 WHICH THE COST OF OPERATION WAS INCURRED;
   (3)  THE  EMPLOYER  SHALL  CERTIFY  TO THE DEPARTMENT THE NAMES OF THE
 EMPLOYEES, THE NAME OF THE CHILD CARE PROVIDER, THE NUMBER  OF  CHILDREN
 SERVED  BY  CARE  SUBSIDIZED VIA THIS TAX CREDIT, THE NUMBER OF CHILDREN
 RECEIVING CARE WHO ARE EXCLUDED FROM THE TAX CREDIT  PURSUANT  TO  PARA-
 GRAPH  FIVE  OF  THIS  SUBDIVISION, AND SUCH OTHER INFORMATION AS MAY BE
 REQUIRED BY THE DEPARTMENT TO ENSURE THAT CREDITS ARE  GRANTED  ONLY  TO
 EMPLOYERS  WHO PROVIDE OR SPONSOR APPROVED CHILD CARE IN ACCORDANCE WITH
 THIS SECTION;
   (4) ONLY IN THE CASE OF EMPLOYER SPONSORED CARE,  THE  AVERAGE  CREDIT
 UTILIZED  PER  CHILD  SHALL  NOT EXCEED THE MARKET RATE PER CHILD ESTAB-
 LISHED BY THE OFFICE OF CHILDREN AND  FAMILY  SERVICES  FOR  THE  SOCIAL
 SERVICES DISTRICT WITHIN WHICH CHILD CARE IS PROVIDED; AND
   (5) THE EMPLOYER SHALL NOT RECEIVE ANY TAX CREDIT FOR CARE PROVIDED TO
 THE  CHILDREN  OF ANY EMPLOYEE WHOSE ANNUAL HOUSEHOLD INCOME EXCEEDS TWO
 HUNDRED THOUSAND DOLLARS.  THE  DEPARTMENT  SHALL  ESTABLISH  RULES  AND
 ACCOUNTING MEASURES TO ENSURE THAT ANY COSTS OF CARE PROVIDED TO EMPLOY-
 EES WITH ANNUAL HOUSEHOLD INCOMES EXCEEDING TWO HUNDRED THOUSAND DOLLARS
 IS ITEMIZED BY THE EMPLOYER AND EXCLUDED FROM THE TAX CREDIT PROVIDED TO
 EMPLOYERS PURSUANT TO THIS SECTION.
   (D) ELECTION. IN ADDITION TO THE TAX CREDIT PROVIDED UNDER SUBDIVISION
 (B) OF THIS SECTION, AN EMPLOYER SHALL ELECT EITHER:
   (1) A CREDIT AGAINST THE TAX FOR THE TAXABLE YEAR IN WHICH THE EMPLOY-
 ER FIRST PLACES IN SERVICE QUALIFIED CHILD CARE PROPERTY AND FOR EACH OF
 THE  ENSUING  NINE TAXABLE YEARS FOLLOWING SUCH TAXABLE YEAR. THE AGGRE-
 GATE AMOUNT OF THE CREDIT SHALL EQUAL ONE HUNDRED PERCENT OF THE COST OF
 ALL QUALIFIED CHILD CARE PROPERTY PURCHASED OR ACQUIRED BY THE  EMPLOYER
 AND  FIRST  PLACED IN SERVICE DURING A TAXABLE YEAR, AND SUCH CREDIT MAY
 BE CLAIMED AT A RATE OF TEN PERCENT PER YEAR OVER A PERIOD OF TEN  TAXA-
 BLE YEARS; OR
   (2) A CREDIT AGAINST THE TAX FOR THE TAXABLE YEAR IN WHICH THE EMPLOY-
 ER  FIRST  PLACES  IN  SERVICE QUALIFIED CHILD CARE PROPERTY. THE CREDIT
 SHALL EQUAL ONE HUNDRED PERCENT OF THE COST OF ALL QUALIFIED CHILD  CARE
 PROPERTY  PURCHASED  OR  ACQUIRED  BY  THE  EMPLOYER AND FIRST PLACED IN
 SERVICE DURING A TAXABLE YEAR.
   (E) CARRYOVER. THE TAX CREDIT ALLOWED UNDER SUBDIVISION  (D)  OF  THIS
 SECTION SHALL BE SUBJECT TO THE FOLLOWING CONDITIONS AND LIMITATIONS:
   (1)  ANY  SUCH CREDIT CLAIMED IN ANY TAXABLE YEAR BUT NOT USED IN SUCH
 TAXABLE YEAR MAY BE CARRIED FORWARD FOR THREE YEARS FROM  THE  CLOSE  OF
 SUCH  TAXABLE  YEAR.  THE SALE, MERGER, ACQUISITION OR BANKRUPTCY OF ANY
 EMPLOYER SHALL NOT CREATE NEW ELIGIBILITY FOR THE CREDIT IN ANY SUCCEED-
 ING TAXPAYER;
   (2) IN NO EVENT SHALL THE AMOUNT OF ANY SUCH TAX CREDIT, INCLUDING ANY
 CARRYOVER OF SUCH CREDIT FROM A PRIOR TAXABLE YEAR, EXCEED FIFTY PERCENT
 OF THE EMPLOYER'S TAX LIABILITY AS  DETERMINED  WITHOUT  REGARD  TO  ANY
 OTHER CREDITS; AND
   (3)  FOR  EVERY  YEAR  IN  WHICH  AN  EMPLOYER CLAIMS SUCH CREDIT, THE
 EMPLOYER SHALL ATTACH A SCHEDULE, WHOSE  FORM  AND  STRUCTURE  SHALL  BE
 ESTABLISHED  BY  THE  DEPARTMENT,  TO  THE EMPLOYER'S TAX RETURN SETTING
 FORTH THE FOLLOWING INFORMATION WITH RESPECT TO SUCH TAX CREDIT:
   (A) A DESCRIPTION OF THE CHILD CARE FACILITY;
   (B) THE AMOUNT OF QUALIFIED CHILD CARE PROPERTY  ACQUIRED  DURING  THE
 TAXABLE YEAR AND THE COST OF SUCH PROPERTY;
   (C) THE AMOUNT OF TAX CREDIT CLAIMED FOR THE TAXABLE YEAR;

 S. 4618                             5
 
   (D)  THE  AMOUNT  OF  QUALIFIED  CHILD CARE PROPERTY ACQUIRED IN PRIOR
 TAXABLE YEARS AND THE COST OF SUCH PROPERTY;
   (E) ANY TAX CREDIT UTILIZED BY THE EMPLOYER IN PRIOR TAXABLE YEARS;
   (F) THE AMOUNT OF TAX CREDIT CARRIED OVER FROM PRIOR YEARS;
   (G)  THE  AMOUNT OF TAX CREDIT UTILIZED BY THE EMPLOYER IN THE CURRENT
 TAXABLE YEAR;
   (H) THE AMOUNT OF TAX CREDIT TO BE CARRIED FORWARD TO  SUBSEQUENT  TAX
 YEARS; AND
   (I)  A DESCRIPTION OF ANY RECAPTURE EVENT OCCURRING DURING THE TAXABLE
 YEAR, A CALCULATION OF THE RESULTING REDUCTION IN TAX CREDITS  ALLOWABLE
 FOR  THE  RECAPTURE  YEAR AND FUTURE TAXABLE YEARS, AND A CALCULATION OF
 THE RESULTING INCREASE IN TAX FOR THE RECAPTURE YEAR.
   (F) RECAPTURE EVENTS. IF A RECAPTURE  EVENT  OCCURS  WITH  RESPECT  TO
 QUALIFIED CHILD CARE PROPERTY:
   (1)  THE  CREDIT  OTHERWISE  ALLOWABLE  UNDER  SUBDIVISION (D) OF THIS
 SECTION WITH RESPECT TO SUCH PROPERTY FOR THE  RECAPTURE  YEAR  AND  ALL
 SUBSEQUENT  TAXABLE  YEARS  SHALL BE REDUCED BY THE APPLICABLE RECAPTURE
 PERCENTAGE; AND
   (2) ALL CREDITS PREVIOUSLY CLAIMED WITH RESPECT TO SUCH PROPERTY UNDER
 SUBDIVISION (D) OF THIS SECTION SHALL BE RECAPTURED AS FOLLOWS:
   (A) ANY CARRYOVER ATTRIBUTABLE TO SUCH CREDITS UNDER PARAGRAPH ONE  OF
 SUBDIVISION (E) OF THIS SECTION SHALL BE REDUCED, BUT NOT BELOW ZERO, BY
 THE RECAPTURE AMOUNT;
   (B)  THE  TAX CREDIT OTHERWISE ALLOWABLE UNDER SUBDIVISION (D) OF THIS
 SECTION FOR THE RECAPTURE YEAR, IF ANY, AS REDUCED UNDER  PARAGRAPH  ONE
 OF  THIS  SUBDIVISION,  SHALL BE FURTHER REDUCED, BUT NOT BELOW ZERO, BY
 THE EXCESS OF THE RECAPTURE AMOUNT OVER THE AMOUNT  TAKEN  INTO  ACCOUNT
 UNDER SUBPARAGRAPH (A) OF THIS PARAGRAPH; AND
   (C) THE TAX IMPOSED UNDER THIS SECTION FOR THE RECAPTURE YEAR SHALL BE
 INCREASED  BY  THE EXCESS OF THE RECAPTURE AMOUNT OVER THE AMOUNTS TAKEN
 INTO ACCOUNT UNDER SUBPARAGRAPH (A) OR (B) OF THIS PARAGRAPH, AS  APPLI-
 CABLE.
   (G) RULES. THE COMMISSIONER SHALL PROMULGATE ANY RULES AND REGULATIONS
 NECESSARY TO IMPLEMENT AND ADMINISTER THE PROVISIONS OF THIS SECTION.
   (H)  CROSS-REFERENCES.  FOR  THE APPLICATION OF THE CREDIT PROVIDED IN
 THIS SECTION, SEE THE FOLLOWING PROVISIONS OF THIS CHAPTER:
   (1) ARTICLE 9-A: SECTION 210-B, SUBDIVISION 28;
   (2) ARTICLE 22: SECTION 606, SUBSECTION (CCC);
   (3) ARTICLE 33: SECTION 1511, SUBDIVISION (DD).
   § 2. Section 210-B of the tax law is amended by adding a new  subdivi-
 sion 28 to read as follows:
   28. EMPLOYER PROVIDED OR SPONSORED CHILD CARE CREDIT. (A) ALLOWANCE OF
 CREDIT.  A TAXPAYER WILL BE ALLOWED A CREDIT, TO BE COMPUTED AS PROVIDED
 IN SECTION FORTY-THREE OF THIS CHAPTER, AGAINST  THE  TAXES  IMPOSED  BY
 THIS ARTICLE.
   (B)  APPLICATION  OF CREDIT. THE CREDIT ALLOWED UNDER THIS SUBDIVISION
 FOR ANY TAXABLE YEAR WILL NOT REDUCE THE TAX DUE FOR SUCH YEAR  TO  LESS
 THAN  THE  AMOUNT  PRESCRIBED  IN  PARAGRAPH  (D)  OF SUBDIVISION ONE OF
 SECTION TWO HUNDRED TEN OF THIS ARTICLE. HOWEVER, IF THE AMOUNT OF CRED-
 IT ALLOWED UNDER THIS SUBDIVISION FOR ANY TAXABLE YEAR REDUCES  THE  TAX
 TO  SUCH AMOUNT OR IF THE TAXPAYER OTHERWISE PAYS TAX BASED ON THE FIXED
 DOLLAR MINIMUM AMOUNT, ANY AMOUNT OF CREDIT THUS NOT DEDUCTIBLE IN  SUCH
 TAXABLE  YEAR WILL BE TREATED AS AN OVERPAYMENT OF TAX TO BE CREDITED OR
 REFUNDED IN ACCORDANCE WITH  THE  PROVISIONS  OF  SECTION  ONE  THOUSAND
 EIGHTY-SIX  OF  THIS  CHAPTER.  PROVIDED,  HOWEVER,  THE  PROVISIONS  OF

 S. 4618                             6
 
 SUBSECTION (C) OF SECTION ONE  THOUSAND  EIGHTY-EIGHT  OF  THIS  CHAPTER
 NOTWITHSTANDING, NO INTEREST WILL BE PAID THEREON.
   §  3. Subparagraph (B) of paragraph 1 of subsection (i) of section 606
 of the tax law is amended by adding a new  clause  (xliii)  to  read  as
 follows:
 
 (XLIII) EMPLOYER                     AMOUNT OF CREDIT
 PROVIDED OR SPONSORED                UNDER SUBDIVISION
 CHILD CARE CREDIT                    TWENTY-EIGHT OF
 UNDER SUBSECTION                     SECTION TWO HUNDRED
 (CCC)                                TEN-B
 
   §  4. Section 606 of the tax law is amended by adding a new subsection
 (ccc) to read as follows:
   (CCC) EMPLOYER PROVIDED OR SPONSORED CHILD CARE CREDIT. (1)  ALLOWANCE
 OF  CREDIT.  A  TAXPAYER  SHALL  BE  ALLOWED A CREDIT, TO BE COMPUTED AS
 PROVIDED IN SECTION FORTY-THREE OF THIS CHAPTER, AGAINST THE TAX IMPOSED
 BY THIS ARTICLE.
   (2) APPLICATION OF CREDIT. IF THE AMOUNT OF THE CREDIT  ALLOWED  UNDER
 THIS SUBSECTION FOR ANY TAXABLE YEAR EXCEEDS THE TAXPAYER'S TAX FOR SUCH
 YEAR, THE EXCESS WILL 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 WILL  BE
 PAID THEREON.
   §  5.  Section 1511 of the tax law is amended by adding a new subdivi-
 sion (dd) to read as follows:
   (DD) EMPLOYER PROVIDED OR SPONSORED CHILD CARE CREDIT.  (1)  ALLOWANCE
 OF  CREDIT.  A  TAXPAYER  WILL  BE  ALLOWED  A CREDIT, TO BE COMPUTED AS
 PROVIDED IN SECTION FORTY-THREE  OF  THIS  CHAPTER,  AGAINST  THE  TAXES
 IMPOSED BY THIS ARTICLE.
   (2)  APPLICATION  OF CREDIT. THE CREDIT ALLOWED UNDER THIS SUBDIVISION
 FOR ANY TAXABLE YEAR WILL NOT REDUCE THE TAX DUE FOR SUCH YEAR  TO  LESS
 THAN  THE  MINIMUM  TAX FIXED BY THIS ARTICLE. HOWEVER, IF THE AMOUNT OF
 CREDIT ALLOWED UNDER THIS SUBDIVISION FOR ANY TAXABLE YEAR  REDUCES  THE
 TAX  TO  SUCH  AMOUNT,  ANY AMOUNT OF CREDIT THUS NOT DEDUCTIBLE IN SUCH
 TAXABLE YEAR WILL BE TREATED AS AN OVERPAYMENT OF TAX TO BE CREDITED  OR
 REFUNDED  IN  ACCORDANCE  WITH  THE  PROVISIONS  OF SECTION ONE THOUSAND
 EIGHTY-SIX  OF  THIS  CHAPTER.  PROVIDED,  HOWEVER,  THE  PROVISIONS  OF
 SUBSECTION  (C)  OF  SECTION  ONE  THOUSAND EIGHTY-EIGHT OF THIS CHAPTER
 NOTWITHSTANDING, NO INTEREST WILL BE PAID THEREON.
   § 6. This act shall take effect immediately.

2017-S4618A (ACTIVE) - Details

Current Committee:: Senate Investigations And Government Operations
Law Section:: Tax Law
Laws Affected:: Add §44, amd §§210-B, 606 & 1511, Tax L
Versions Introduced in Other Legislative Sessions:: 2019-2020: S8943
2021-2022: S2609
2023-2024: S3447

2017-S4618A (ACTIVE) - Summary

Establishes business franchise, personal income and insurance franchise tax credits for the expenses of employer provided or sponsored child care.

2017-S4618A (ACTIVE) - Sponsor Memo

                                 BILL NUMBER:  S4618A

 TITLE OF BILL :  An act to amend the tax law, in relation to
establishing business franchise, personal income and insurance
franchise tax credits for employer provided or sponsored child care

 PURPOSE :

This bill creates a new child care tax credit for businesses that will
support businesses' child care operating and capital expenses while
incentivizing employers to provide child care for their employees.

 SUMMARY OF PROVISIONS :

Section 1: Provides various definitions. Delineates between employer
sponsored care (care that is paid by the employer and contracted out
to third party providers), and employer provided care (care the
employer provides on premises at their own facilities).

For capital costs, the employer may claim a tax credit equal to 100%
of capital costs for on premises child care facilities for
construction or acquisition of child care facilities on or after
January 1, 2018. The employer may either spread the capital costs over
a period of ten years after the child care costs are placed in
service, or may alternatively claim all of the capital costs during
the year in which the child care facility is placed in service.

Mandates that any facility receiving tax credits must be licensed by
the Office of Children and Family Services or the Department of Health
and Mental Hygiene in New York City. Ninety-five percent of the
children who use the facility must be children of employees of the
employer receiving the credit.

The capital costs credit may not exceed ten percent of an employer's
tax liability in any given year.

Provides that the capital costs of constructing a child care facility
will be recaptured by the state if the facility is taken out of
service within fourteen years. Each year later within that period
would result in a lower recapture amount.

In years that the employer claims the capital expenses credit, the
employer must send the department information relating to the facility
for which the credit is claimed, in addition to any information
concerning a recapture of the property.

Provides that employers may take a seventy-five percent tax credit for
employer sponsored care or employer provided care.

The tax credit will be capped at fifty percent of the employer's tax
liability for a taxable year, but a credit can be carried forward up
to three taxable years.

Employers must report to the department of taxation and finance: the
names of the employees served, the name of the child care provider,
the number of children served by care subsidized via the tax credit,
the number of children excluded from care, and any other information
the department requires to ensure that the credits are only granted to
employers who provide or sponsor approved child care.

The tax credit cannot apply to families whose annual household income
exceeds two-hundred thousand dollars; employers must itemize those
families out of any credit claimed.

In the case of employer sponsored care, the average credit claimed per
child served by the employer may not exceed the market rate per child
established by OCFS for the social services district within which
child care is provided.

Section 2: Tax law cross-references to ensure the tax credit applies
to all qualified businesses operating in New York State.

Section 3: Tax law cross-references to ensure the tax credit applies
to all qualified businesses operating in New York State.

Section 4: Tax law cross-references to ensure the tax credit applies
to all qualified businesses operating in New York State.

Section 5: Tax law cross-references to ensure the tax credit applies
to all qualified businesses operating in New York State.

Section 6: The act shall take effect immediately.

 EXISTING LAW :

Under current law, New York does not provide a business child care tax
credit. The federal government currently provides a 25% tax credit for
child care operating expenses.

 JUSTIFICATION :

The cost for child care in New York State is now among the highest of
any state. At around $10,400 per year per infant, and over $9,000 per
toddler, child care costs have reached such heights that New York's
working families can often no longer afford safe, regulated child care
without substantial support from the state through subsidy programs.
Due to oversubscription in the child care subsidy system, many
families do not have access to subsidies. The alternatives available
to these families who cannot afford care are grim: either leave their
jobs to care for the children, and forego income and spending power,
or try to find an unregulated, unlicensed, potentially dangerous
provider that offers services for a cheaper price.

A lack of affordable child care is dangerous for children, financially
harmful to families (either as a result of pressure on their budgets
to pay for care, or forcing them to leave their jobs), and has
detrimental effects on New York's economy. Less families working
results in less economic activity, reduced spending, and potentially
more stress on social programs to support these families.

Employer sponsored or provided child care has the potential to provide
multiple benefits to New York's families, businesses, and economy: it
can provide employers with a valuable recruitment perk and benefit for
existing and potential employees; it can make it easy for employees to
find safe, reliable child care without searching around at child cares
that may not have any slots available; it can keep children close to
their parents so daily commutes are easier; it can reduce the burden
on the child care subsidy system by freeing up slots for more
children; and it will ensure more families have access to reliable,
stable, and safe care so that they can retain their jobs.

New York's working families do not have adequate access to child care.
Incentivizing businesses to build more child care facilities and to
provide care to their employees' children is one potential avenue to
address the rising costs and increasingly limited availability of
regulated child care.

 LEGISLATIVE HISTORY :

This is a new bill.

 FISCAL IMPLICATIONS :
To be determined.

 LOCAL FISCAL IMPLICATIONS :

None.

2017-S4618A (ACTIVE) - Bill Text download pdf

                            
 
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                  4618--A
 
                        2017-2018 Regular Sessions
 
                             I N  S E N A T E
 
                             February 22, 2017
                                ___________
 
 Introduced  by Sen. HAMILTON -- read twice and ordered printed, and when
   printed to be committed to the Committee on Investigations and Govern-
   ment Operations -- reported favorably from said committee and  commit-
   ted to the Committee on Finance -- committee discharged, bill amended,
   ordered reprinted as amended and recommitted to said committee

 AN  ACT to amend the tax law, in relation to establishing business fran-
   chise, personal income and insurance franchise tax credits for employ-
   er provided or sponsored child care
 
   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 44 to read
 as follows:
   § 44. EMPLOYER PROVIDED OR SPONSORED CHILD CARE. (A) DEFINITIONS.  FOR
 THE PURPOSES OF THIS SECTION, THE FOLLOWING TERMS SHALL HAVE THE FOLLOW-
 ING MEANINGS:
   (1)  "COST OF OPERATION" MEANS ANY REASONABLE DIRECT OPERATIONAL COSTS
 INCURRED BY AN EMPLOYER AS A RESULT OF PROVIDING  EMPLOYER  PROVIDED  OR
 EMPLOYER  SPONSORED  CHILD CARE FACILITIES; PROVIDED, HOWEVER, THAT SUCH
 TERM SHALL EXCLUDE THE COST OF ANY PROPERTY THAT IS QUALIFIED CHILD CARE
 PROPERTY.
   (2) "EMPLOYER" MEANS A TAXPAYER WHO IS AN EMPLOYER UPON WHOM TAXES ARE
 IMPOSED PURSUANT TO ARTICLE NINE-A, TWENTY-TWO OR THIRTY-THREE  OF  THIS
 CHAPTER.
   (3) "EMPLOYER PROVIDED" MEANS CHILD CARE OFFERED ON THE PREMISES OF AN
 EMPLOYER.
   (4)  "EMPLOYER SPONSORED" MEANS A CONTRACTUAL ARRANGEMENT WITH A CHILD
 CARE FACILITY THAT IS PAID FOR BY AN EMPLOYER.
   (5) "PREMISES OF THE  EMPLOYER"  MEANS  A  WORKPLACE  PREMISES  OF  AN
 EMPLOYER, WITHIN THE STATE, PROVIDING THE CHILD CARE, OR BY ONE EMPLOYER
 PROVIDING  THE  CHILD  CARE IN THE EVENT THAT THE CHILD CARE PROPERTY IS
 OWNED JOINTLY OR SEVERALLY BY SUCH EMPLOYER AND ONE OR  MORE  EMPLOYERS;
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.

                                                            LBD08283-03-7

 S. 4618--A                          2
 
 PROVIDED,  HOWEVER, THAT IF SUCH WORKPLACE PREMISES ARE IMPRACTICABLE OR
 OTHERWISE UNSUITABLE FOR THE ON-SITE LOCATION OF A CHILD CARE  FACILITY,
 AS  DETERMINED  BY  THE  OFFICE  OF  CHILDREN AND FAMILY SERVICES, OR IN
 CITIES  OF ONE MILLION OR MORE, THE CITY DEPARTMENT OF HEALTH AND MENTAL
 HYGIENE, SUCH FACILITY MAY BE LOCATED WITHIN A  REASONABLE  DISTANCE  OF
 THE PREMISES OF THE EMPLOYER.
   (6)  "QUALIFIED  CHILD CARE PROPERTY" INCLUDES, BUT IS NOT LIMITED TO,
 AMOUNTS EXPENDED  ON  LAND  ACQUISITION,  IMPROVEMENTS,  BUILDINGS,  AND
 BUILDING  IMPROVEMENTS AND FURNITURE, FIXTURES, AND EQUIPMENT, AND MEANS
 ALL REAL PROPERTY AND TANGIBLE PERSONAL PROPERTY PURCHASED  OR  ACQUIRED
 ON  OR  AFTER JANUARY FIRST, TWO THOUSAND EIGHTEEN, OR WHICH PROPERTY IS
 FIRST PLACED IN SERVICE ON OR AFTER JANUARY FIRST,  TWO  THOUSAND  EIGH-
 TEEN, FOR USE EXCLUSIVELY IN THE CONSTRUCTION, EXPANSION, IMPROVEMENT OR
 OPERATION OF AN EMPLOYER PROVIDED CHILD CARE FACILITY, BUT ONLY IF:
   (A) THE FACILITY IS LICENSED OR COMMISSIONED BY THE OFFICE OF CHILDREN
 SERVICES PURSUANT TO SECTION THREE HUNDRED NINETY OF THE SOCIAL SERVICES
 LAW,  OR IN CITIES OF ONE MILLION OR MORE, THE CITY DEPARTMENT OF HEALTH
 AND MENTAL HYGIENE PURSUANT TO ARTICLE FORTY-SEVEN OF THE HEALTH CODE OF
 THE CITY OF NEW YORK.
   (B) AT LEAST NINETY-FIVE PERCENT OF THE CHILDREN WHO USE THE  FACILITY
 ARE CHILDREN OF EMPLOYEES OF:
   (I)  THE EMPLOYER AND OTHER EMPLOYERS IN THE EVENT THAT THE CHILD CARE
 PROPERTY IS OWNED JOINTLY OR SEVERALLY BY THE EMPLOYER AND ONE  OR  MORE
 OTHER EMPLOYERS; OR
   (II)  A  CORPORATION  THAT  IS  A MEMBER OF THE TAXPAYER'S "AFFILIATED
 GROUP" WITHIN THE MEANING OF SECTION 1504(A)  OF  THE  INTERNAL  REVENUE
 CODE.
   (C)  THE  EMPLOYER  HAS  NOT PREVIOUSLY CLAIMED ANY TAX CREDIT FOR THE
 COST OF OPERATION FOR SUCH  QUALIFIED  CHILD  CARE  PROPERTY  PLACED  IN
 SERVICE  PRIOR TO TAXABLE YEARS BEGINNING ON OR AFTER JANUARY FIRST, TWO
 THOUSAND EIGHTEEN.
   (B) ALLOWANCE OF CREDIT. A TAX CREDIT AGAINST THE TAXES IMPOSED PURSU-
 ANT TO ARTICLES NINE-A, TWENTY-TWO  AND  THIRTY-THREE  OF  THIS  CHAPTER
 SHALL  BE GRANTED TO AN EMPLOYER WHO PROVIDES OR SPONSORS CHILD CARE FOR
 EMPLOYEES. SUCH TAX CREDIT SHALL BE IN AN AMOUNT EQUAL TO TEN PERCENT OF
 THE COST OF OPERATION INCURRED BY THE EMPLOYER, AND  SUCH  CREDIT  SHALL
 NOT  EXCEED  TEN  THOUSAND  DOLLARS  LESS  ANY AMOUNTS PAID BY EMPLOYEES
 DURING THE TAXABLE YEAR.
   (C) CONDITIONS AND LIMITATIONS. THE TAX CREDIT ALLOWED UNDER  SUBDIVI-
 SION  (B)  OF  THIS SECTION SHALL BE SUBJECT TO THE FOLLOWING CONDITIONS
 AND LIMITATIONS:
   (1) THE EMPLOYER SHALL CERTIFY TO THE  DEPARTMENT  THE  NAMES  OF  THE
 EMPLOYEES,  THE  NAME OF THE CHILD CARE PROVIDER, THE NUMBER OF CHILDREN
 SERVED BY CARE SUBSIDIZED VIA THIS TAX CREDIT, THE  NUMBER  OF  CHILDREN
 RECEIVING  CARE  WHO  ARE EXCLUDED FROM THE TAX CREDIT PURSUANT TO PARA-
 GRAPH THREE OF THIS SUBDIVISION, AND SUCH OTHER INFORMATION  AS  MAY  BE
 REQUIRED  BY  THE  DEPARTMENT TO ENSURE THAT CREDITS ARE GRANTED ONLY TO
 EMPLOYERS WHO PROVIDE OR SPONSOR APPROVED CHILD CARE IN ACCORDANCE  WITH
 THIS SECTION;
   (2)  ONLY  IN  THE CASE OF EMPLOYER SPONSORED CARE, THE AVERAGE CREDIT
 UTILIZED PER CHILD SHALL NOT EXCEED THE MARKET  RATE  PER  CHILD  ESTAB-
 LISHED  BY  THE  OFFICE  OF  CHILDREN AND FAMILY SERVICES FOR THE SOCIAL
 SERVICES DISTRICT WITHIN WHICH CHILD CARE IS PROVIDED; AND
   (3) THE EMPLOYER SHALL NOT RECEIVE ANY TAX CREDIT FOR CARE PROVIDED TO
 THE CHILDREN OF ANY EMPLOYEE WHOSE ANNUAL HOUSEHOLD INCOME  EXCEEDS  TWO
 HUNDRED  THOUSAND  DOLLARS.  THE  DEPARTMENT  SHALL  ESTABLISH RULES AND

 S. 4618--A                          3
 
 ACCOUNTING MEASURES TO ENSURE THAT ANY COSTS OF CARE PROVIDED TO EMPLOY-
 EES WITH ANNUAL HOUSEHOLD INCOMES EXCEEDING TWO HUNDRED THOUSAND DOLLARS
 ARE ITEMIZED BY THE EMPLOYER AND EXCLUDED FROM THE TAX  CREDIT  PROVIDED
 TO EMPLOYERS PURSUANT TO THIS SECTION.
   (D) ELECTION. IN ADDITION TO THE TAX CREDIT PROVIDED UNDER SUBDIVISION
 (B)  OF  THIS SECTION, AN EMPLOYER SHALL BE GRANTED A CREDIT AGAINST THE
 TAX FOR THE TAXABLE YEAR IN WHICH THE EMPLOYER FIRST PLACES  IN  SERVICE
 QUALIFIED  CHILD CARE PROPERTY. THE CREDIT SHALL EQUAL TWENTY PERCENT OF
 THE COST OF ALL QUALIFIED CHILD CARE PROPERTY PURCHASED OR  ACQUIRED  BY
 THE  EMPLOYER  AND  FIRST  PLACED IN SERVICE DURING A TAXABLE YEAR. SUCH
 CREDIT SHALL NOT EXCEED TWENTY THOUSAND DOLLARS.
   (E) CARRYOVER. THE TAX CREDIT ALLOWED UNDER SUBDIVISION  (D)  OF  THIS
 SECTION SHALL BE SUBJECT TO THE FOLLOWING CONDITIONS AND LIMITATIONS:
   (1)  ANY  SUCH CREDIT CLAIMED IN ANY TAXABLE YEAR BUT NOT USED IN SUCH
 TAXABLE YEAR MAY BE CARRIED FORWARD FOR THREE YEARS FROM  THE  CLOSE  OF
 SUCH  TAXABLE  YEAR.  THE SALE, MERGER, ACQUISITION OR BANKRUPTCY OF ANY
 EMPLOYER SHALL NOT CREATE NEW ELIGIBILITY FOR THE CREDIT IN ANY SUCCEED-
 ING TAXPAYER;
   (2) IN NO EVENT SHALL THE AMOUNT OF ANY SUCH TAX CREDIT, INCLUDING ANY
 CARRYOVER OF SUCH CREDIT FROM A PRIOR TAXABLE YEAR, EXCEED FIFTY PERCENT
 OF THE EMPLOYER'S TAX LIABILITY AS  DETERMINED  WITHOUT  REGARD  TO  ANY
 OTHER CREDITS; AND
   (3)  FOR  EVERY  YEAR  IN  WHICH  AN  EMPLOYER CLAIMS SUCH CREDIT, THE
 EMPLOYER SHALL ATTACH A SCHEDULE, WHOSE  FORM  AND  STRUCTURE  SHALL  BE
 ESTABLISHED  BY  THE  DEPARTMENT,  TO  THE EMPLOYER'S TAX RETURN SETTING
 FORTH THE FOLLOWING INFORMATION WITH RESPECT TO SUCH TAX CREDIT:
   (A) A DESCRIPTION OF THE CHILD CARE FACILITY;
   (B) THE AMOUNT OF QUALIFIED CHILD CARE PROPERTY  ACQUIRED  DURING  THE
 TAXABLE YEAR AND THE COST OF SUCH PROPERTY;
   (C) THE AMOUNT OF TAX CREDIT CLAIMED FOR THE TAXABLE YEAR;
   (D)  THE  AMOUNT  OF  QUALIFIED  CHILD CARE PROPERTY ACQUIRED IN PRIOR
 TAXABLE YEARS AND THE COST OF SUCH PROPERTY;
   (E) ANY TAX CREDIT UTILIZED BY THE EMPLOYER IN PRIOR TAXABLE YEARS;
   (F) THE AMOUNT OF TAX CREDIT CARRIED OVER FROM PRIOR YEARS;
   (G) THE AMOUNT OF TAX CREDIT UTILIZED BY THE EMPLOYER IN  THE  CURRENT
 TAXABLE YEAR;
   (H)  THE  AMOUNT OF TAX CREDIT TO BE CARRIED FORWARD TO SUBSEQUENT TAX
 YEARS; AND
   (I) A DESCRIPTION OF ANY RECAPTURE EVENT OCCURRING DURING THE  TAXABLE
 YEAR,  A CALCULATION OF THE RESULTING REDUCTION IN TAX CREDITS ALLOWABLE
 FOR THE RECAPTURE YEAR AND FUTURE TAXABLE YEARS, AND  A  CALCULATION  OF
 THE RESULTING INCREASE IN TAX FOR THE RECAPTURE YEAR.
   (F) RECAPTURE.
   (1)  IF THE TAXPAYER DISPOSES OF THE QUALIFIED CHILD CARE PROPERTY, OR
 IF SUCH PROPERTY CEASES TO BE A QUALIFIED  CHILD  CARE  PROPERTY  EXCEPT
 FOR:
   (A) ANY TRANSFER BY REASON OF DEATH;
   (B) ANY TRANSFER BETWEEN SPOUSES OR INCIDENT TO DIVORCE;
   (C)  ANY  TRANSACTION  TO WHICH SECTION 381(A) OF THE INTERNAL REVENUE
 CODE APPLIES;
   (D) ANY CHANGE IN THE FORM OF CONDUCTING THE EMPLOYER'S TRADE OR BUSI-
 NESS SO LONG AS THE PROPERTY IS RETAINED BY SUCH TRADE  OR  BUSINESS  AS
 QUALIFIED  CHILD  CARE  PROPERTY  AND THE EMPLOYER RETAINS A SUBSTANTIAL
 INTEREST IN SUCH TRADE OR BUSINESS; OR
   (E) ANY ACCIDENT OR CASUALTY, THE TAXPAYER'S TAX IMPOSED BY THIS ARTI-
 CLE FOR THE TAXABLE YEAR IN WHICH SUCH DISPOSITION OR  CESSATION  OCCURS

 S. 4618--A                          4
 
 SHALL  BE INCREASED BY THE RECAPTURE PORTION OF THE CREDIT ALLOWED UNDER
 PARAGRAPH TWO OF THIS SUBDIVISION FOR ALL PRIOR TAXABLE YEARS.
   (2)  FOR  PURPOSES OF PARAGRAPH ONE OF THIS SUBDIVISION, THE RECAPTURE
 PORTION SHALL REDUCE THE CREDIT OTHERWISE  ALLOWABLE  UNDER  SUBDIVISION
 (D)  OF THIS SECTION, BUT SHALL NOT, AT ANY POINT, REDUCE THE TAX CREDIT
 BELOW ZERO. ANY EXCESS OF THE RECAPTURE AMOUNT SHALL RESULT IN AN EQUIV-
 ALENT INCREASE IN THE TAX IMPOSED UNDER THIS SECTION.
   (G) RULES. THE COMMISSIONER SHALL PROMULGATE ANY RULES AND REGULATIONS
 NECESSARY TO IMPLEMENT AND ADMINISTER THE PROVISIONS OF THIS SECTION.
   (H) CROSS-REFERENCES. FOR THE APPLICATION OF THE  CREDIT  PROVIDED  IN
 THIS SECTION, SEE THE FOLLOWING PROVISIONS OF THIS CHAPTER:
   (1) ARTICLE 9-A: SECTION 210-B, SUBDIVISION 28;
   (2) ARTICLE 22: SECTION 606, SUBSECTION (CCC);
   (3) ARTICLE 33: SECTION 1511, SUBDIVISION (DD).
   §  2. Section 210-B of the tax law is amended by adding a new subdivi-
 sion 28 to read as follows:
   28. EMPLOYER PROVIDED OR SPONSORED CHILD CARE CREDIT. (A) ALLOWANCE OF
 CREDIT. A TAXPAYER WILL BE ALLOWED A CREDIT, TO BE COMPUTED AS  PROVIDED
 IN SECTION FORTY-FOUR OF THIS CHAPTER, AGAINST THE TAXES IMPOSED BY THIS
 ARTICLE.
   (B)  APPLICATION  OF CREDIT. THE CREDIT ALLOWED UNDER THIS SUBDIVISION
 FOR ANY TAXABLE YEAR WILL NOT REDUCE THE TAX DUE FOR SUCH YEAR  TO  LESS
 THAN  THE  AMOUNT  PRESCRIBED  IN  PARAGRAPH  (D)  OF SUBDIVISION ONE OF
 SECTION TWO HUNDRED TEN OF THIS ARTICLE. HOWEVER, IF THE AMOUNT OF CRED-
 IT ALLOWED UNDER THIS SUBDIVISION FOR ANY TAXABLE YEAR REDUCES  THE  TAX
 TO  SUCH AMOUNT OR IF THE TAXPAYER OTHERWISE PAYS TAX BASED ON THE FIXED
 DOLLAR MINIMUM AMOUNT, ANY AMOUNT OF CREDIT THUS NOT DEDUCTIBLE IN  SUCH
 TAXABLE  YEAR WILL BE TREATED AS AN OVERPAYMENT OF TAX TO BE CREDITED OR
 REFUNDED IN ACCORDANCE WITH  THE  PROVISIONS  OF  SECTION  ONE  THOUSAND
 EIGHTY-SIX  OF  THIS  CHAPTER.  PROVIDED,  HOWEVER,  THE  PROVISIONS  OF
 SUBSECTION (C) OF SECTION ONE  THOUSAND  EIGHTY-EIGHT  OF  THIS  CHAPTER
 NOTWITHSTANDING, NO INTEREST WILL BE PAID THEREON.
   §  3. Subparagraph (B) of paragraph 1 of subsection (i) of section 606
 of the tax law is amended by adding a  new  clause  (xliv)  to  read  as
 follows:
 
 (XLIV) EMPLOYER                      AMOUNT OF CREDIT
 PROVIDED OR SPONSORED                UNDER SUBDIVISION
 CHILD CARE CREDIT                    TWENTY-EIGHT OF
 UNDER SUBSECTION                     SECTION TWO HUNDRED
 (CCC)                                TEN-B

   §  4. Section 606 of the tax law is amended by adding a new subsection
 (ccc) to read as follows:
   (CCC) EMPLOYER PROVIDED OR SPONSORED CHILD CARE CREDIT. (1)  ALLOWANCE
 OF  CREDIT.  A  TAXPAYER  SHALL  BE  ALLOWED A CREDIT, TO BE COMPUTED AS
 PROVIDED IN SECTION FORTY-FOUR OF THIS CHAPTER, AGAINST THE TAX  IMPOSED
 BY THIS ARTICLE.
   (2)  APPLICATION  OF CREDIT. IF THE AMOUNT OF THE CREDIT ALLOWED UNDER
 THIS SUBSECTION FOR ANY TAXABLE YEAR EXCEEDS THE TAXPAYER'S TAX FOR SUCH
 YEAR, THE EXCESS WILL 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 WILL BE
 PAID THEREON.
   § 5. Section 1511 of the tax law is amended by adding a  new  subdivi-
 sion (dd) to read as follows:

 S. 4618--A                          5
 
   (DD)  EMPLOYER  PROVIDED OR SPONSORED CHILD CARE CREDIT. (1) ALLOWANCE
 OF CREDIT. A TAXPAYER WILL BE  ALLOWED  A  CREDIT,  TO  BE  COMPUTED  AS
 PROVIDED  IN  SECTION  FORTY-FOUR  OF  THIS  CHAPTER,  AGAINST THE TAXES
 IMPOSED BY THIS ARTICLE.
   (2)  APPLICATION  OF CREDIT. THE CREDIT ALLOWED UNDER THIS SUBDIVISION
 FOR ANY TAXABLE YEAR WILL NOT REDUCE THE TAX DUE FOR SUCH YEAR  TO  LESS
 THAN  THE  MINIMUM  TAX FIXED BY THIS ARTICLE. HOWEVER, IF THE AMOUNT OF
 CREDIT ALLOWED UNDER THIS SUBDIVISION FOR ANY TAXABLE YEAR  REDUCES  THE
 TAX  TO  SUCH  AMOUNT,  ANY AMOUNT OF CREDIT THUS NOT DEDUCTIBLE IN SUCH
 TAXABLE YEAR WILL BE TREATED AS AN OVERPAYMENT OF TAX TO BE CREDITED  OR
 REFUNDED  IN  ACCORDANCE  WITH  THE  PROVISIONS  OF SECTION ONE THOUSAND
 EIGHTY-SIX  OF  THIS  CHAPTER.  PROVIDED,  HOWEVER,  THE  PROVISIONS  OF
 SUBSECTION  (C)  OF  SECTION  ONE  THOUSAND EIGHTY-EIGHT OF THIS CHAPTER
 NOTWITHSTANDING, NO INTEREST WILL BE PAID THEREON.
   § 6. This act shall take effect immediately.

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