NY State Senate Bill 2021-S637

Senate Bill S637

2021-2022 Legislative Session

Establishes the work opportunity tax credit for businesses with fifty employees or less for hiring a long term unemployed person

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Archive: Last Bill Status - In Senate Committee Budget And Revenue 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 05, 2022	referred to budget and revenue
Jan 06, 2021	referred to budget and revenue

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2021-S637 (ACTIVE) - Details

See Assembly Version of this Bill:: A5300
Current Committee:: Senate Budget And Revenue
Law Section:: Tax Law
Laws Affected:: Amd §§210-B, 606 & 1511, Tax L
Versions Introduced in Other Legislative Sessions:: 2015-2016: S5573
2017-2018: S1517
2019-2020: S2119, A8471
2023-2024: S5846, A5239

2021-S637 (ACTIVE) - Summary

Establishes the work opportunity tax credit for businesses with fifty employees or less for hiring a long term unemployed person; a credit shall be allowed of up to $2,400; the total amount of credit provided statewide shall not exceed fifteen million dollars.

2021-S637 (ACTIVE) - Sponsor Memo

                                
 
BILL NUMBER: S637

SPONSOR: SANDERS
 
TITLE OF BILL:

An act to amend the tax law, in relation to establishing the work oppor-
tunity tax credit

 
PURPOSE OR GENERAL IDEA OF BILL:

To provide a state tax credit for small businesses in order to incentiv-
ize the hiring of long term unemployed persons.

 
SUMMARY OF PROVISIONS:

Section one of the bill amends section 210-B of the tax law by adding a
new subdivision 49, which establishes the work opportunity tax credit.
It provides that a taxpayer shall be allowed a credit of two thousand
four hundred dollars for each long term unemployed person hired during a
taxable year. The credit is applicable to businesses that have fifty or
fewer employees. A "long term unemployed person" is defined as an indi-

vidual who has been a resident of New York for three years immediately
preceding hiring and who, prior to being hired by the business eligible
for the credit, had been unemployed and receiving public assistance for
six consecutive months or more, and is retained for full-time unemploy-
ment by such business for at least one year.

Section two amends subparagraph (B) of paragraph 1 of subsection (i) of
section 606 of the tax law by adding a new clause to establish the work
opportunity tax credit.

Section three amends section 606 of the tax law by adding a new
subsection (ccc), which establishes the work opportunity tax credit.  It
provides that a taxpayer shall be allowed a credit of two thousand four
hundred dollars for each long term unemployed person hired during a
taxable year. The credit is applicable to businesses that have fifty or
fewer employees. A "long term unemployed person" is defined as an indi-
vidual who has been a resident of New York for three years immediately
preceding hiring and who, prior to being hired by the business eligible
for the credit, had been unemployed and receiving public assistance for
six consecutive months or more, and is retained for full-time unemploy-
ment by such business for at least one year.

Section four establishes that this act shall take effect immediately and
apply to taxable years beginning on and after January 1, 2020.

 
JUSTIFICATION:

As our economy continues to recover from the Great Recession, the long-
term unemployment rate has remained unacceptably high. Studies across
the board show that those who have been unemployed for a longer period
of time have a much harder chance of landing that next job. Current
statistics from the U.S Bureau of Labor reflect that the number of long-
term unemployed persons remains at levels more than twice as high as
those prior to the Great Recession. The problem is far-reaching with
national unemployment rates revealing that despite recent job growth,
the long-term unemployed continue to make up approximately 30% of the
unemployed in all age and education ranges.

At the same time, studies have shown that one of the keys to economic
growth lies within small businesses. The growth of small businesses is
critical to ensuring continued innovation and opportunity, all the while
diversifying our economy. Small businesses are the engine behind job
expansion and a strong economy.

This legislation aims to address two issues: long-term unemployment, and
small business growth. By providing a tax credit to small businesses for
each long-term unemployed individual they hire and retain as a new
employee, this bill will ultimately spur job creation, provide an added
incentive to hire an individual who has had more difficulty finding work
than others, and provide much-needed tax relief to small businesses.

 
PRIOR LEGISLATIVE HISTORY:

2017: S.1517 REFERRED TO INVESTIGATIONS AND GOVERNMENT OPERATIONS

2018: S.1517 REFERRED TO INVESTIGATIONS AND GOVERNMENT OPERATIONS

 
FISCAL IMPLICATIONS:

The total amount of the state tax credit is capped at $15 million in the
aggregate in a taxable year beginning January 1, 2020.

 
EFFECTIVE DATE:
This act shall take effect immediately and apply to taxable years begin-
ning on and after January 1, 2020.

2021-S637 (ACTIVE) - Bill Text download pdf

                            
 
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                    637
 
                        2021-2022 Regular Sessions
 
                             I N  S E N A T E
 
                                (PREFILED)
 
                              January 6, 2021
                                ___________
 
 Introduced  by  Sen. SANDERS -- read twice and ordered printed, and when
   printed to be committed to the Committee on Budget and Revenue
 
 AN ACT to amend the tax law, in relation to establishing the work oppor-
   tunity tax credit

   THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section  1.  Section  210-B  of the tax law is amended by adding a new
 subdivision 55 to read as follows:
   55. WORK OPPORTUNITY TAX CREDIT. (A) ALLOWANCE OF CREDIT.  A  TAXPAYER
 SHALL  BE  ALLOWED A CREDIT, AGAINST THE TAX IMPOSED BY THIS ARTICLE, OF
 TWO THOUSAND FOUR HUNDRED DOLLARS FOR EACH LONG TERM  UNEMPLOYED  PERSON
 HIRED DURING A TAXABLE YEAR. SUCH TAX CREDIT SHALL BE APPLICABLE ONLY TO
 BUSINESSES  EMPLOYING FIFTY OR FEWER EMPLOYEES. FOR THE PURPOSES OF THIS
 SUBDIVISION, A "LONG TERM UNEMPLOYED PERSON" SHALL BE AN INDIVIDUAL  WHO
 HAS  BEEN  A  RESIDENT OF NEW YORK FOR THREE YEARS IMMEDIATELY PRECEDING
 HIRING AND WHO, PRIOR TO BEING HIRED BY THE BUSINESS  ELIGIBLE  FOR  THE
 CREDIT ESTABLISHED PURSUANT TO THIS SUBDIVISION, HAD BEEN UNEMPLOYED AND
 RECEIVING  PUBLIC  ASSISTANCE FOR SIX CONSECUTIVE MONTHS OR MORE, AND IS
 RETAINED FOR FULL-TIME EMPLOYMENT BY SUCH  BUSINESS  FOR  AT  LEAST  ONE
 YEAR.
   (B)  APPLICATION  OF CREDIT. THE CREDIT ALLOWED UNDER THIS SUBDIVISION
 FOR ANY TAXABLE YEAR SHALL NOT REDUCE THE TAX DUE FOR SUCH YEAR TO  LESS
 THAN  THE  FIXED  DOLLAR  MINIMUM  AMOUNT PRESCRIBED IN PARAGRAPH (D) OF
 SUBDIVISION ONE OF SECTION TWO HUNDRED TEN OF THIS ARTICLE. HOWEVER,  IF
 THE AMOUNT OF CREDIT 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 SHALL 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
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets

                       [ ] is old law to be omitted.
                                                            LBD04533-01-1

 S. 637                              2
 
 PROVISIONS OF SUBSECTION (C) OF SECTION  ONE  THOUSAND  EIGHTY-EIGHT  OF
 THIS  CHAPTER  NOTWITHSTANDING,  NO  INTEREST SHALL BE PAID THEREON. THE
 TOTAL AMOUNT OF CREDIT TO BE PROVIDED STATEWIDE  FOR  THIS  CREDIT,  THE
 CREDIT ALLOWED UNDER SUBSECTION (KKK) OF SECTION SIX HUNDRED SIX OF THIS
 CHAPTER  AND  SUBDIVISION (EE) OF SECTION FIFTEEN HUNDRED ELEVEN OF THIS
 CHAPTER SHALL NOT EXCEED FIFTEEN MILLION DOLLARS IN THE AGGREGATE  IN  A
 TAXABLE YEAR.
   (C)  CREDIT  RECAPTURE.  FOR PROVISIONS REQUIRING RECAPTURE OF CREDIT,
 SEE SECTION FORTY-FOUR OF THIS CHAPTER.
   § 2. Subparagraph (B) of paragraph 1 of subsection (i) of section  606
 of  the  tax  law  is  amended  by adding a new clause (xlvi) to read as
 follows:
 
 (XLVI) WORK OPPORTUNITY TAX CREDIT   AMOUNT OF CREDIT UNDER
 UNDER SUBSECTION (KKK)               SUBDIVISION FIFTY-FIVE OF
                                      SECTION TWO HUNDRED TEN-B
 
   § 3. Section 606 of the tax law is amended by adding a new  subsection
 (kkk) to read as follows:
   (KKK) WORK OPPORTUNITY TAX CREDIT. (1) ALLOWANCE OF CREDIT. A TAXPAYER
 SHALL  BE  ALLOWED A CREDIT, AGAINST THE TAX IMPOSED BY THIS ARTICLE, OF
 TWO THOUSAND FOUR HUNDRED DOLLARS FOR EACH LONG TERM  UNEMPLOYED  PERSON
 HIRED DURING A TAXABLE YEAR. SUCH TAX CREDIT SHALL BE APPLICABLE ONLY TO
 BUSINESSES  EMPLOYING FIFTY OR FEWER EMPLOYEES. FOR THE PURPOSES OF THIS
 SUBDIVISION, A "LONG TERM UNEMPLOYED PERSON" SHALL BE AN INDIVIDUAL  WHO
 HAS  BEEN  A  RESIDENT OF NEW YORK FOR THREE YEARS IMMEDIATELY PRECEDING
 HIRING AND WHO, PRIOR TO BEING HIRED BY THE BUSINESS  ELIGIBLE  FOR  THE
 CREDIT  ESTABLISHED PURSUANT TO THIS SUBSECTION, HAD BEEN UNEMPLOYED AND
 RECEIVING PUBLIC ASSISTANCE FOR SIX CONSECUTIVE MONTHS OR MORE,  AND  IS
 RETAINED  FOR  FULL-TIME  EMPLOYMENT  BY  SUCH BUSINESS FOR AT LEAST ONE
 YEAR.
   (2) APPLICATION OF CREDIT. IF THE AMOUNT OF THE CREDIT  ALLOWED  UNDER
 THIS SUBSECTION FOR ANY TAXABLE YEAR SHALL EXCEED THE TAXPAYER'S TAX FOR
 SUCH  YEAR,  THE  EXCESS SHALL 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
 SHALL BE PAID THEREON. THE TOTAL AMOUNT OF CREDIT TO BE PROVIDED  STATE-
 WIDE FOR THIS CREDIT, THE CREDIT ALLOWED UNDER SUBDIVISION FIFTY-FIVE OF
 SECTION  TWO  HUNDRED  TEN-B  OF  THIS  CHAPTER  AND SUBDIVISION (EE) OF
 SECTION FIFTEEN HUNDRED ELEVEN OF THIS CHAPTER SHALL NOT EXCEED  FIFTEEN
 MILLION DOLLARS IN THE AGGREGATE IN A TAXABLE YEAR.
   (3)  CREDIT  RECAPTURE.  FOR PROVISIONS REQUIRING RECAPTURE OF CREDIT,
 SEE SECTION FORTY-FOUR OF THIS CHAPTER.
   § 4. Section 1511 of the tax law is amended by adding a  new  subdivi-
 sion (ee) to read as follows:
   (EE)  WORK OPPORTUNITY TAX CREDIT. (1) ALLOWANCE OF CREDIT. A TAXPAYER
 SHALL BE ALLOWED A CREDIT, AGAINST THE TAX IMPOSED BY THIS  ARTICLE,  OF
 TWO  THOUSAND  FOUR HUNDRED DOLLARS FOR EACH LONG TERM UNEMPLOYED PERSON
 HIRED DURING A TAXABLE YEAR. SUCH TAX CREDIT SHALL BE APPLICABLE ONLY TO
 BUSINESSES EMPLOYING FIFTY OR FEWER EMPLOYEES. FOR THE PURPOSES OF  THIS
 SUBDIVISION,  A "LONG TERM UNEMPLOYED PERSON" SHALL BE AN INDIVIDUAL WHO
 HAS BEEN A RESIDENT OF NEW YORK FOR THREE  YEARS  IMMEDIATELY  PRECEDING
 HIRING  AND  WHO,  PRIOR TO BEING HIRED BY THE BUSINESS ELIGIBLE FOR THE
 CREDIT ESTABLISHED PURSUANT TO THIS SUBDIVISION, HAD BEEN UNEMPLOYED AND
 RECEIVING PUBLIC ASSISTANCE FOR SIX CONSECUTIVE MONTHS OR MORE,  AND  IS
 RETAINED  FOR  FULL-TIME  EMPLOYMENT  BY  SUCH BUSINESS FOR AT LEAST ONE

 S. 637                              3
 
 YEAR. THE TOTAL AMOUNT OF CREDIT TO  BE  PROVIDED  STATEWIDE  SHALL  NOT
 EXCEED FIFTEEN MILLION DOLLARS IN A TAXABLE YEAR.
   (2)  APPLICATION  OF CREDIT. THE CREDIT ALLOWED UNDER THIS SUBDIVISION
 SHALL NOT REDUCE THE TAX DUE FOR SUCH YEAR TO BE LESS THAN  THE  MINIMUM
 FIXED  BY  PARAGRAPH  FOUR OF SUBDIVISION (A) OF SECTION FIFTEEN HUNDRED
 TWO OR SECTION FIFTEEN HUNDRED  TWO-A  OF  THIS  ARTICLE,  WHICHEVER  IS
 APPLICABLE.  HOWEVER,  IF  THE  AMOUNT  OF THE CREDIT ALLOWED UNDER THIS
 SUBDIVISION FOR ANY TAXABLE YEAR REDUCES  THE  TAXPAYER'S  TAX  TO  SUCH
 AMOUNT,  ANY  AMOUNT OF CREDIT THUS NOT DEDUCTIBLE 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 ONE THOUSAND EIGHTY-EIGHT
 OF THIS CHAPTER NOTWITHSTANDING, NO INTEREST SHALL BE PAID THEREON.  THE
 TOTAL  AMOUNT  OF  CREDIT  TO BE PROVIDED STATEWIDE FOR THIS CREDIT, THE
 CREDIT ALLOWED UNDER SUBDIVISION FIFTY-FIVE OF SECTION TWO HUNDRED TEN-B
 OF THIS CHAPTER AND SUBDIVISION (KKK) OF SECTION SIX HUNDRED SIX OF THIS
 CHAPTER SHALL NOT EXCEED FIFTEEN MILLION DOLLARS IN THE AGGREGATE  IN  A
 TAXABLE YEAR.
   (3)  CREDIT  RECAPTURE.  FOR PROVISIONS REQUIRING RECAPTURE OF CREDIT,
 SEE SECTION FORTY-FOUR OF THIS CHAPTER.
   § 5. This act shall take effect immediately and shall apply to taxable
 years beginning on and after January 1, 2022 and shall apply to eligible
 individuals hired on and after such effective date.

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Senate Bill S637

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Sponsored By

James Sanders Jr.