What's happening
This bill exempts certain lower-income New York City residents from paying city personal income tax by raising the income threshold for taxation.
Why it matters
Raises the income thresholds at which New York City residents begin owing city personal income tax, meaning more low- and moderate-income individuals and families will owe zero tax at the city level. This directly increases the take-home pay of those earning up to $45,000 (married filers), $32,500 (heads of household and singles), reducing financial pressure on lower-income households.
Ensures that taxpayers whose income now falls below the new thresholds are not only exempt from the regular city income tax, but also from any special or additional taxes that are calculated as a percentage of the basic city income tax. This closes potential loopholes that could otherwise continue to impose extra taxes on those newly exempt.
May reduce the overall tax burden for a significant number of New York City residents, potentially impacting city revenue and future budgeting. This could contribute to economic relief for lower-income groups but may also require the city to adjust spending or find new revenue sources.
Could help address income inequality and the high cost of living in New York City by targeting tax relief specifically to those with lower earnings, making it a progressive policy measure. This change is particularly significant in a city where housing and living costs are a major concern for many residents.
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Who cares
Headline styles
End City Tax for Poor
Plain English, a few words. Used as the page title.
Sponsors
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History
- Referred to investigations and government operations
- Referred to investigations and government operations
Full text
3 pagesUnderlined is new[Struck] is removedOfficial text on nysenate.gov ↗
STATE OF NEW YORK
615
2017-2018 Regular Sessions
IN SENATE
January 4, 2017
Introduced by Sen. ALCANTARA -- read twice and ordered printed, and when printed to be committed to the Committee on Investigations and Government Operations
AN ACT to amend the tax law, in relation to making certain taxpayers exempt from the city personal income tax of the city of New York
The People of the State of New York, represented in Senate and Assembly, do enact as follows:
Section 1. Paragraphs 1, 2 and 3 of subsection (b) of section 1304 of the tax law, as amended by chapter 338 of the laws of 2014, is amended to read as follows:
(1) Resident married individuals filing joint returns and resident surviving spouses. The tax under this section for each taxable year on the city taxable income of every city resident married individual who makes a single return jointly with his or her spouse under subsection (b) of section thirteen hundred six of this article and on the city taxable income of every city resident surviving spouse shall be determined in accordance with the following table:
For taxable years beginning after two thousand seventeen:
If the city taxable income is: The tax is: Not over [$21,600] [1.18% of the city taxable income] [Over $21,600 but not] [$255 plus 1.435% of excess] [over] $45,000 [over $21,600] 0% of the city
taxable income Over $45,000 but not $591 plus 1.455% of excess over $90,000 over $45,000 Over $90,000 $1,245 plus 1.48% of excess
over $90,000
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD06777-01-7
S. 615 2
(2) Resident heads of households. The tax under this section for each taxable year on the city taxable income of every city resident head of a household shall be determined in accordance with the following table:
For taxable years beginning after two thousand seventeen:
If the city taxable income is: The tax is: Not over [$14,400] [1.18% of the city taxable income] [Over $14,400 but not] [$170 plus 1.435% of excess] [over $30,000] $32,500 [over $14,400] 0% of the
city taxable income Over [$30,000] $32,500 but not $394 plus 1.455% of excess over $60,000 over [$30,000] $32,500 Over $60,000 $830 plus 1.48% of excess
over $60,000
(3) Resident unmarried individuals, resident married individuals filing separate returns and resident estates and trusts. The tax under this section for each taxable year on the city taxable income of every city resident individual who is not a city resident married individual who makes a single return jointly with his or her spouse under subsection (b) of section thirteen hundred six of this article or a city resident head of household or a city resident surviving spouse, and on the city taxable income of every city resident estate and trust shall be determined in accordance with the following table:
For taxable years beginning after two thousand seventeen:
If the city taxable income is: The tax is: Not over [$12,000] [1.18% of the city taxable income] [Over $12,000 but not] [$142 plus 1.435% of excess] [over $25,000] $32,500 [over $12,000] 0% of the
city taxable income Over [$25,000] $32,500 but not $328 plus 1.455% of excess over $50,000 over [$25,000] $32,500 Over $50,000 $692 plus 1.48% of excess
over $50,000
§ 2. Paragraph 1 of subsection (a) of section 1304-B of the tax law, as amended by chapter 338 of the laws of 2014, is amended to read as follows:
(1) In addition to any other taxes authorized by this article, any city imposing such taxes is hereby authorized and empowered to adopt and amend local laws imposing in any such city for each taxable year beginning after nineteen hundred ninety but before two thousand eighteen, an additional tax on the city taxable income of every city resident individual, estate and trust, to be calculated for each taxable year as follows: (i) for each taxable year beginning after nineteen hundred ninety but before nineteen hundred ninety-nine, at the rate of fourteen percent of the sum of the taxes for each such taxable year determined pursuant to section thirteen hundred four and section thirteen hundred four-A of this article; and (ii) for each taxable year beginning after nineteen hundred ninety-eight, at the rate of fourteen percent of the tax for such taxable year determined pursuant to such section thirteen hundred four; provided, however, that any taxable income with a tax rate of zero percent shall not be subject to any additional tax pursuant to this section.
S. 615 3
§ 3. Subparagraph (A) of paragraph 1, subparagraph (A) of paragraph 2 and subparagraph (A) of paragraph 3 of subsection (a) of section 1304-D of the tax law, as added by section 1 of part B of chapter 63 of the laws of 2003, are amended to read as follows:
(A) For taxable years beginning in two thousand five:
If the city taxable income is: The tax is: Not over [$21,600] [2.907% of the city taxable income] [Over $21,600 but not] [$628 plus 3.534% of excess] [over] $45,000 [over $21,600] 0% of the city
taxable income Over $45,000 but not $1,455 plus 3.591% of excess over $90,000 over $45,000 Over $90,000 but not $3,071 plus 3.648% of excess over $150,000 over $90,000 Over $150,000 but not $5,260 plus 4.05% of excess over $500,000 over $150,000 Over $500,000 $19,435 plus 4.45% of excess
over $500,000
(A) For taxable years beginning in two thousand five:
If the city taxable income is: The tax is: Not over [$14,400] [2.907% of the city taxable income] [Over $14,400 but not] [$419 plus 3.534% of excess] [over $30,000] $32,500 [over $14,400] 0% of the
city taxable income Over [$30,000] $32,500 but not $970 plus 3.591% of excess over $60,000 over [$30,000] $32,500 Over $60,000 but not $2,047 plus 3.648% of excess over $125,000 over $60,000 Over $125,000 but not $4,418 plus 4.05% of excess over $500,000 over $125,000 Over $500,000 $19,606 plus 4.45% of excess
over $500,000
(A) For taxable years beginning in two thousand five:
If the city taxable income is: The tax is: Not over [$12,000] [2.907% of the city taxable income] [Over $12,000 but not] [$349 plus 3.534% of excess] [over $25,000] $32,500 [over $12,000] 0% of the
city taxable income Over [$25,000] $32,500 but not $808 plus 3.591% of excess over $50,000 over [$25,000] $32,500 Over $50,000 but not $1,706 plus 3.648% of excess over $100,000 over $50,000 Over $100,000 but not $3,530 plus 4.05% of excess over $500,000 over $100,000 Over $500,000 $19,730 plus 4.45% of excess
over $500,000
§ 4. This act shall take effect immediately.
Reflowed for reading: line numbers and page breaks removed. Cite the official text.
Sponsor's memo
Title of bill
An act to amend the tax law, in relation to making certain taxpayers exempt from the city personal income tax of the city of New York
Purpose
Provides that taxpayers in the city of New York with annual incomes not more than $45,000 shall not be subject to city personal income taxation
Summary of provisions
Section one amends paragraphs 1, 2 and 3 of subsection (b) of section 1304 of the tax law, as amended by chapter 338 of the laws of 2014 to provide a tax rate of 0% on city taxable income levels of $45,000 or less beginning in tax year 2017.
Section two amends paragraph 1 of subsection (a) of section 1304-B of the tax law, as amended by chapter 338 of the laws of 2014 to provide, further, that taxable income with a tax rate of zero percent shall not be subject to any additional rate of taxation imposed by the city of New York.
Section three amends subparagraph (A) of paragraph 1, subparagraph (A) of paragraph 2 and subparagraph (A) of paragraph 3 of subsection (a) of section 1304-D of the tax law, as added by section 1 of part B of chapter 63 of the laws of 2003 to provide a tax rate of 0% on city taxable income levels of $45,000 or less.
Section four is the effective date.
Justification
New York is one of the most expensive places to live in the world. However approximately 48.5% of New Yorkers earn less than $50,000 per year. When combined with the high cost of living, many working class New Yorkers have a hard time making ends meet and affording basic necessities.
While New York State took an important step toward improving workers' economic security through raising the hourly minimum wage to $15.00 by 2018, New York City minimum wage workers still face difficult economic burdens. In 1966, New York City began collecting a Personal Income Tax (PIT), which hits city residents on top of New York State and federal income taxes.
So while the fight for $15 and property tax measures provided some relief to middle- and working-class families, the PIT continues to undermine these economic gains.
In order to truly allow low- and middle-income workers to benefit from the minimum wage increase passed via the state budget, and to continue addressing the growing income inequality gap, this legislation to create a 0% New York City Personal Income Tax bracket for working class families and individuals. With the elimination of the PIT for these income bands, we can help nearly two million households build a better life and pursue the American dream.
Legislative history
New legislation
Fiscal impact
None to the State.
Effective date
This act shall take effect immediately.
Summaries, headlines and scores are AI-generated from the official bill text. How we score bills. Source: NYS Open Legislation.