NY State Senate Bill 2023-S4436

Senate Bill S4436

2023-2024 Legislative Session

Establishes a personal income tax deduction for the interest paid on student loans by certain taxpayers

download bill text pdf

Current 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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Actions

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	Assembly Actions - Lowercase Senate Actions - UPPERCASE
Jan 03, 2024	referred to budget and revenue
Feb 08, 2023	referred to budget and revenue

2023-S4436 (ACTIVE) - Details

See Assembly Version of this Bill:: A6109
Current Committee:: Senate Budget And Revenue
Law Section:: Tax Law
Laws Affected:: Amd §612, Tax L
Versions Introduced in Other Legislative Sessions:: 2017-2018: S7666
2019-2020: S3105
2021-2022: S746

2023-S4436 (ACTIVE) - Summary

Establishes a personal income tax deduction for the interest paid on student loans by individual taxpayers having a federal adjusted income of between $65,000 and $125,000, and married taxpayers filing jointly having a federal adjusted income of between $130,000 and $250,000.

2023-S4436 (ACTIVE) - Sponsor Memo

                                 
BILL NUMBER: S4436

SPONSOR: FERNANDEZ
 
TITLE OF BILL:

An act to amend the tax law, in relation to establishing a reduction of
certain taxpayer's federal adjusted gross income, for state personal
income tax purposes, for student loan interest payments made by the
taxpayer

 
PURPOSE OR GENERAL IDEA OF BILL:

To establish a state level student loan interest deduction for middle-
income filers (both single and joint) that currently are unable to bene-
fit from the federal deduction.

 
SUMMARY OF PROVISIONS:

  Section  1:  Amends  subsection  (c)  of section 612 of the tax law by
adding a new paragraph 44 to allow a taxpayer who files singly or as the
head of  a  household  with  a  federal  adjusted  income,  without  the
deduction  of  any  interest  paid  on  student  loans, of not less than

$65,000 nor more than $80,000, to receive from the state, the difference
between the student loan interest  deduction  received  by  the  federal
government and $2,500.

Allows  a taxpayer who files singly or as the head of a household with a
federal adjusted gross income of not less than  $80,000  nor  more  than
$125,000, to receive from the state a student loan interest deduction of
$2,500.

Allows  a  married taxpayer who files jointly a federal adjusted income,
without the deduction of any interest paid on student loans, of not less
than $130,000 nor more than $160,000, to receive  from  the  state,  the
difference  between  the student loan interest deduction received by the
federal government and $2,500.

Allows a married taxpayer who files  jointly  with  a  federal  adjusted
gross  income  of  not  less  than  $160,000  nor more than $250,000, to
receive from the state a student loan interest deduction of $2,500.

  Section 2: Effective Date.

 
JUSTIFICATION:

Although 30 percent of college students do not borrow  at  all  to  fund
their  degrees,  in  New  York,  the average student who borrows to fund
their degree owes $28,974. The aggregate student loan debt in the  state
has  grown  by  $43.3 billion in the last 10 years from $38.8 billion in
2006 to $82 billion in 2015.

One of the existing programs that helps individuals deal with this  debt
is  the  student  loan  interest deduction allowed at the federal level.
This is an above the line deduction of  up  to  $2,500  for  individuals
making  under  $65,000  or  a  smaller  amount  up to those making under
$80,000 a year.  According  to  a  study  by  the  Center  for  American
Progress,  the average deduction taken by New York tax filers was $1,111
in tax year 2015, the last year for which data is available.

 
PRIOR LEGISLATIVE HISTORY:

2021-2022: S746

2019-2020: S3105

 
FISCAL IMPLICATIONS:

TBD

 
EFFECTIVE DATE:
This  act  shall take effect immediately, and shall apply to the taxable
year in which it shall take effect and to all subsequent taxable years.

2023-S4436 (ACTIVE) - Bill Text download pdf

                             
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   4436
 
                        2023-2024 Regular Sessions
 
                             I N  S E N A T E
 
                             February 8, 2023
                                ___________
 
 Introduced by Sen. FERNANDEZ -- 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 a reduction of
   certain taxpayer's federal adjusted gross income, for  state  personal
   income  tax  purposes,  for student loan interest payments made by the
   taxpayer
 
   THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section  1. Subsection (c) of section 612 of the tax law is amended by
 adding a new paragraph 47 to read as follows:
   (47)(A) (I) FOR A TAXPAYER WHO FILES SINGLY OR AS THE HEAD OF A HOUSE-
 HOLD WITH A FEDERAL ADJUSTED INCOME, WITHOUT THE DEDUCTION OF ANY INTER-
 EST PAID ON STUDENT LOANS, OF NOT LESS THAN SIXTY-FIVE THOUSAND  DOLLARS
 NOR MORE THAN EIGHTY THOUSAND DOLLARS, THE DIFFERENCE BETWEEN THE INTER-
 EST  PAID  ON  STUDENT LOANS BY THE TAXPAYER, IS AN AMOUNT NOT TO EXCEED
 TWO THOUSAND FIVE HUNDRED DOLLARS,  AND  THE  AMOUNT  OF  SUCH  INTEREST
 DEDUCTED BY SUCH TAXPAYER TO CALCULATE HIS OR HER FEDERAL ADJUSTED GROSS
 INCOME; AND
   (II)  FOR  A  TAXPAYER  WHO FILES SINGLY OR AS THE HEAD OF A HOUSEHOLD
 WITH A FEDERAL ADJUSTED GROSS INCOME OF NOT LESS  THAN  EIGHTY  THOUSAND
 DOLLARS,  NOR MORE THAN ONE HUNDRED TWENTY-FIVE THOUSAND DOLLARS, INTER-
 EST, IN AN AMOUNT NOT TO EXCEED TWO THOUSAND FIVE HUNDRED DOLLARS,  PAID
 ON INDEBTEDNESS INCURRED FROM A STUDENT LOAN; AND
   (III)  FOR  MARRIED  TAXPAYERS  FILING JOINTLY WITH A FEDERAL ADJUSTED
 GROSS INCOME, WITHOUT THE DEDUCTION OF  ANY  INTEREST  PAID  ON  STUDENT
 LOANS,  OF  NOT  LESS THAN ONE HUNDRED THIRTY THOUSAND DOLLARS, NOR MORE
 THAN ONE HUNDRED SIXTY THOUSAND  DOLLARS,  THE  DIFFERENCE  BETWEEN  THE
 INTEREST  PAID  ON  STUDENT  LOANS BY THE TAXPAYERS, IS AN AMOUNT NOT TO
 EXCEED TWO THOUSAND FIVE HUNDRED DOLLARS, AND THE AMOUNT OF SUCH  INTER-
 EST DEDUCTED BY SUCH TAXPAYERS TO CALCULATE THEIR FEDERAL ADJUSTED GROSS
 INCOME; AND
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
                                                            LBD08763-01-3

 S. 4436                             2
 
   (IV)  FOR  MARRIED  TAXPAYERS  FILING  JOINTLY WITH A FEDERAL ADJUSTED
 GROSS INCOME OF NOT LESS THAN ONE HUNDRED SIXTY  THOUSAND  DOLLARS,  NOR
 MORE THAN TWO HUNDRED FIFTY THOUSAND DOLLARS, INTEREST, IN AN AMOUNT NOT
 TO  EXCEED  TWO  THOUSAND  FIVE  HUNDRED  DOLLARS,  PAID ON INDEBTEDNESS
 INCURRED FROM A STUDENT LOAN.
   (B)  FOR THE PURPOSES OF THIS PARAGRAPH, "STUDENT LOAN" SHALL HAVE THE
 SAME MEANING AS ASCRIBED TO SUCH TERM BY SUBPARAGRAPH (B)  OF  PARAGRAPH
 FORTY-TWO OF THIS SUBSECTION, AS ADDED BY CHAPTER FOUR HUNDRED FIFTY-SIX
 OF THE LAWS OF TWO THOUSAND SEVENTEEN.
   §  2.  This  act shall take effect immediately, and shall apply to the
 taxable year in which it shall take effect and to all subsequent taxable
 years.

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