What's happening
This bill establishes a supplemental "tax table benefit recapture" and creates new, higher personal income tax brackets for New York City.
Why it matters
The bill introduces a “tax table benefit recapture” that phases out certain tax advantages (“tax table benefits”) for higher-income filers. meaning that as incomes rise above specified thresholds ($250,000 for married joint filers, $150,000 for single/separate, $180,000 for heads of household), these filers lose access to fixed-dollar tax reductions, increasing their effective tax burden.
It establishes new, higher tax brackets and marginal rates at the upper end of the income scale for New York City taxpayers. , with the top bracket starting at $2 million in taxable income and taxed at 3.8%, increasing the progressivity of the city’s income tax system.
The changes specifically target higher-income individuals and families, reducing benefits and increasing tax rates only for those above certain income levels. , while lower- and middle-income brackets retain existing rates, reflecting a policy choice to raise additional revenue from the wealthiest residents.
Implementation requires the Department of Taxation and Finance to actively inform taxpayers and adjust estimated tax payments. , which could affect tax planning and withholding for affected individuals, potentially leading to larger tax bills or required adjustments during tax filing season.
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Higher Taxes on High Earners
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- Referred to ways and means
- Referred to ways and means
Full text
4 pagesUnderlined is new[Struck] is removedOfficial text on nysenate.gov ↗
STATE OF NEW YORK
675
2017-2018 Regular Sessions
IN ASSEMBLY
January 9, 2017
Introduced by M. of A. RODRIGUEZ -- read once and referred to the Committee on Ways and Means
AN ACT to amend the administrative code of the city of New York and the tax law, in relation to establishing a tax table benefit recapture; and in relation to New York city personal income tax rates
The People of the State of New York, represented in Senate and Assembly, do enact as follows:
Section 1. Section 11-1701 of the administrative code of the city of New York is amended by adding a new subdivision (i) to read as follows:
(i) Tax table benefit recapture. For taxable years beginning in two thousand eighteen, there is hereby imposed a supplemental tax, in addition to the tax imposed under the opening paragraph of this section, for the purpose of recapturing the benefit of the tax tables contained in subdivision (a) of this section. The supplemental tax shall be an amount equal to the sum of the tax table benefits in paragraphs one, two and three of this subdivision multiplied by their respective fractions in such paragraphs.
(1) Resident married individuals filing joint returns and surviving spouses. Subparagraphs (A) and (B) of this paragraph apply only to filers whose taxable income exceeds $250,000.
(A) The tax table benefit is $333.
(B) The fraction is computed as follows: the numerator is the lesser of fifty thousand dollars or the excess of New York adjusted gross income for the taxable year over two hundred fifty thousand dollars and the denominator is fifty thousand dollars.
(2) Resident unmarried individuals and resident married individuals filing separate returns. Subparagraphs (A) and (B) of this paragraph apply only to filers whose taxable income exceeds $150,000.
(A) The tax table benefit is $185.
(B) The fraction is computed as follows: the numerator is the lesser of fifty thousand dollars or the excess of New York adjusted gross
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD04720-01-7
A. 675 2
income for the taxable year over one hundred fifty thousand dollars and the denominator is fifty thousand dollars.
(3) Resident head of household. Subparagraphs (A) and (B) of this paragraph apply only to filers whose taxable income exceeds $180,000.
(A) The tax table benefit is $222.
(B) The fraction is computed as follows: the numerator is the lesser of fifty thousand dollars or the excess of New York adjusted gross income for the taxable year over one hundred eighty thousand dollars and the denominator is fifty thousand dollars.
§ 2. Paragraph 1 of subdivision (a) of section 11-1701 of the administrative code of the city of New York is amended by adding a new subparagraph (C) to read as follows:
(C) For taxable years beginning in two thousand eighteen:
If the city taxable income is: The tax is: Not over $21,600 2.168% of the city taxable income Over $21,600 but not $468 plus 2.635% of excess over $45,000 over $21,600 Over $45,000 but not $1,085 plus 2.993% of excess over $90,000 over $45,000 Over $90,000 but not $2,432 plus 3.15% of excess over $150,000 over $90,000 Over $150,000 but not $4,322 plus 3.2% of excess over $500,000 over $150,000 Over $500,000 but not $15,522 plus 3.4% of excess over $1,000,000 over $500,000 Over $1,000,000 but not $32,522 plus 3.7% of excess over $2,000,000 over $1,000,000 Over $2,000,000 $69,522 plus 3.8% of excess
over $2,000,000
§ 3. Paragraph 2 of subdivision (a) of section 11-1701 of the administrative code of the city of New York is amended by adding a new subparagraph (C) to read as follows:
(C) For taxable years beginning in two thousand eighteen:
If the city taxable income is: The tax is: Not over $14,400 2.168% of the city taxable income Over $14,400 but not $312 plus 2.635% of excess over $30,000 over $14,400 Over $30,000 but not $723 plus 2.993% of excess over $60,000 over $30,000 Over $60,000 but not $1,621 plus 3.15% of excess over $100,000 over $60,000 Over $100,000 but not $2,881 plus 3.2% of excess over $500,000 over $100,000 Over $500,000 but not $15,681 plus 3.4% of excess over $1,000,000 over $500,000 Over $1,000,000 but not $32,681 plus 3.7% of excess over $2,000,000 over $1,000,000 Over $2,000,000 $69,681 plus 3.8% of excess
over $2,000,000
§ 4. Paragraph 3 of subdivision (a) of section 11-1701 of the administrative code of the city of New York is amended by adding a new subparagraph (C) to read as follows:
A. 675 3
(C) For taxable years beginning in two thousand eighteen:
If the city taxable income is: The tax is: Not over $12,000 2.168% of the city taxable income Over $12,000 but not $260 plus 2.635% of excess over $25,000 over $12,000 Over $25,000 but not $603 plus 2.993% of excess over $50,000 over $25,000 Over $50,000 but not $1,351 plus 3.15% of excess over $83,000 over $50,000 Over $83,000 but not $2,400 plus 3.2% of excess over $500,000 over $83,000 Over $500,000 but not $15,734 plus 3.4% of excess over $1,000,000 over $500,000 Over $1,000,000 but not $32,734 plus 3.7% of excess over $2,000,000 over $1,000,000 Over $2,000,000 $69,734 plus 3.8% of excess
over $2,000,000
§ 5. Paragraph 1 of subsection (a) of section 1304 of the tax law is amended by adding a new subparagraph (C) to read as follows:
(C) For taxable years beginning in two thousand eighteen:
If the city taxable income is: The tax is: Not over $21,600 2.168% of the city taxable income Over $21,600 but not $468 plus 2.635% of excess over $45,000 over $21,600 Over $45,000 but not $1,085 plus 2.993% of excess over $90,000 over $45,000 Over $90,000 but not $2,432 plus 3.15% of excess over $150,000 over $90,000 Over $150,000 but not $4,322 plus 3.2% of excess over $500,000 over $150,000 Over $500,000 but not $15,522 plus 3.4% of excess over $1,000,000 over $500,000 Over $1,000,000 but not $32,522 plus 3.7% of excess over $2,000,000 over $1,000,000 Over $2,000,000 $69,522 plus 3.8% of excess
over $2,000,000
§ 6. Paragraph 2 of subsection (a) of section 1304 of the tax law is amended by adding a new subparagraph (C) to read as follows:
(C) For taxable years beginning in two thousand eighteen: If the city taxable income is: The tax is: Not over $14,400 2.168% of the city taxable income Over $14,400 but not $312 plus 2.635% of excess over $30,000 over $14,400 Over $30,000 but not $723 plus 3.15% of excess over $60,000 over $30,000 Over $60,000 but not $1,621 plus 3.15% of excess over $100,000 over $60,000 Over $100,000 but not $2,881 plus 3.2% of excess over $500,000 over $100,000 Over $500,000 but not $15,681 plus 3.4% of excess over $1,000,000 over $500,000
A. 675 4
Over $1,000,000 but not $32,681 plus 3.7% of excess over $2,000,000 over $1,000,000 Over $2,000,000 $69,681 plus 3.8% of excess
over $2,000,000
§ 7. Paragraph 3 of subsection (a) of section 1304 of the tax law is amended by adding a new subparagraph (C) to read as follows:
(C) For taxable years beginning in two thousand eighteen: If the city taxable income is: The tax is: Not over $12,000 2.168% of the city taxable income Over $12,000 but not $260 plus 2.635% of excess over $25,000 over $12,000 Over $25,000 but not $603 plus 2.993% of excess over $50,000 over $25,000 Over $50,000 but not $1,351 plus 3.15% of excess over $83,000 over $50,000 Over $83,000 but not $2,400 plus 3.2% of excess over $500,000 over $83,000 Over $500,000 but not $15,734 plus 3.4% of excess over $1,000,000 over $500,000 Over $1,000,000 but not $32,734 plus 3.7% of excess over $2,000,000 over $1,000,000 Over $2,000,000 $69,734 plus 3.8% of excess
over $2,000,000
§ 8. The commissioner of taxation and finance shall take steps to publicize the necessary adjustments to estimated tax and, to the extent reasonably possible, to inform the taxpayer of the tax liability changes made by this act.
§ 9. This act shall take effect immediately.
Reflowed for reading: line numbers and page breaks removed. Cite the official text.
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