BILL NUMBER: S3528

SPONSOR: CARLUCCI
 
TITLE OF BILL:  An act to amend the tax law, in relation to increasing
the college tuition personal income tax credit

 
PURPOSE:

To increase the amount of tuition expenses that can be claimed for the
tuition tax credit.

 
SUMMARY OF PROVISIONS:

Section 1. Amends subparagraph (A) of paragraph 2 of subsection (t) of
section 606 of the tax law to double the amount that can he claimed as
an allowable college tuition expense from ten thousand dollars to twenty
thousand dollars.

Section 2. Effective date.

 
              

JUSTIFICATION:

New York State currently helps lessen the burden on families coping with
paying for college by offering the option of a credit or deduction for
college tuition expenses they incur during a tax year.  A participating
New York taxpayer can claim this credit or deduction on tuition expenses
they paid for themselves, a spouse or a dependent. The credit or
deduction can be claimed on expenses paid to any accredited college or
university, whether it be in New York or outside of New York, and
regardless of whether it is public or private. Families in New York get
a choice of applying for a credit, which is money they get back after
their tax liability is calculated, or claiming a deduction, which lowers
their taxable income, depending on which solution they find most help-
ful.

The amount of tuition expenses that can be claimed for this credit has
not been changed since 2001, when this credit was created. According to
a report by the College Board, the averaae cost of tuition at a private
nonprofit four-year institution was $29,056 for the 2012-13 academic
year, a 2696 increase from the 2002-03 academic year. In the same time
the average tuition for public four-year institutions has climbed by 40%
according to this same study. The current credit amount needs to
increase to keep up with this massive inflation in college costs.

 
LEGISLATIVE HISTORY:

2017-18: S712/A3627 INVESTIGATIONS & GOV'T OPS/ways & means
2015-16: S1222/A6574 - Investigations & Government Operations/Ways &
Means
2014: S6697-A/A9664 Investigations & Government Operations/Ways & Means

 
FISCAL IMPLICATIONS:

This legislation would double the amount individuals can claim as eligi-
ble tuition expenses for the tuition tax credit. Currently, this tax
expenditure is estimated to cost the state $250 million. The most
conservative estimate is that this legislation would double this cost,
and thus would cost the state an additional $250 million in lost tax
revenue annually.
 
EFFECTIVE DATE:
This act shall take effect immediately, and shall apply to the taxable
year in which it takes effect and taxable years commencing on or after
such date.