What's happening
This bill allows the low income housing tax credit to be refunded as an overpayment of tax, without interest.
Why it matters
Makes the low income housing tax credit usable even for those with little or no tax liability. , enabling non-profit developers, affordable housing sponsors, or individuals without sufficient tax owed to still benefit—potentially increasing participation in affordable housing projects.
Refunds the credit as if it were a tax overpayment, but without paying interest. , meaning eligible recipients get cash back from the government promptly, but they cannot claim extra money if the refund is delayed.
Requires an official eligibility statement from the Commissioner of Housing and Community Renewal. , adding an administrative check that could ensure only qualified projects or individuals receive the benefit, but also introducing a possible bottleneck or paperwork burden.
Applies retroactively to tax years beginning January 1, 2019. , allowing for claims on past projects and potentially providing an immediate financial boost to entities involved in low income housing created or financed since that date.
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Who cares
Headline styles
Refund Low-Income Housing Credits
Plain English, a few words. Used as the page title.
Sponsors
No co-sponsors yet.
History
- Referred to finance
Full text
2 pagesUnderlined is new[Struck] is removedOfficial text on nysenate.gov ↗
STATE OF NEW YORK
1061
2019-2020 Regular Sessions
IN SENATE
January 10, 2019
Introduced by Sen. YOUNG -- read twice and ordered printed, and when printed to be committed to the Committee on Finance
AN ACT to amend the tax law, in relation to providing that the low income housing credit shall be treated as an overpayment of taxes
The People of the State of New York, represented in Senate and Assembly, do enact as follows:
Section 1. Paragraph (c) of subdivision 15 of section 210-B of the tax law is relettered paragraph (d) and a new paragraph (c) is added to read as follows:
(c) Treatment of credit. The amount of the credit allowed under this subdivision shall be treated as an overpayment of tax to be credited or refunded, provided that the credits: (1) have an eligibility statement issued by the commissioner of housing and community renewal pursuant to article two-A of the public housing law, and (2) are available pursuant to law enacted after January first, two thousand nineteen. Provided, however, that notwithstanding the provisions of subsection (c) of section one thousand eighty-eight of this chapter, no interest shall be paid thereon.
§ 2. Paragraph 3 of subsection (x) of section 606 of the tax law is renumbered paragraph 4 and a new paragraph 3 is added to read as follows:
(3) Treatment of credit. The amount of the credit allowed under this subsection shall be treated as an overpayment of tax to be credited or refunded as provided in section six hundred eighty-six of this article, provided that the credits: (i) have an eligibility statement issued by the commissioner of housing and community renewal pursuant to article two-A of the public housing law, and (ii) are available pursuant to law enacted after January first, two thousand nineteen. Provided, however, that no interest shall be paid thereon.
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD03738-01-9
S. 1061 2
§ 3. Paragraph 3 of subdivision (n) of section 1511 of the tax law is renumbered paragraph 4 and a new paragraph 3 is added to read as follows:
(3) Treatment of credit. The amount of the credit allowed under this subdivision shall be treated as an overpayment of tax to be credited or refunded, provided that the credits: (A) have an eligibility statement issued by the commissioner of housing and community renewal pursuant to article two-A of the public housing law, and (B) are available pursuant to law enacted after January first, two thousand nineteen. Provided, however, that notwithstanding the provisions of subsection (c) of section one thousand eighty-eight of this chapter, no interest shall be paid thereon.
§ 4. This act shall take effect immediately and shall apply to tax years commencing on or after January 1, 2019.
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 providing that the low income housing credit shall be treated as an overpayment of taxes
Purpose
This bill would convert the state low income housing tax credit to a refundable tax credit to help stimulate low income housing investment in the state.
Summary of provisions
This bill would amend subdivision 30 of section 210 of the tax law to provide that for allocations of housing tax credit made pursuant to law after January 1, 2019, the corporate franchise low income housing tax credit shall be treated as a refundable tax credit. Paragraph 3 of subsection (x) of section 606 of the tax law is amended to convert the existing low income housing tax credit to a refundable low income hous- ing tax credit for allocations of housing tax credit made after taxable years beginning after January 1, 2019. Paragraph 3 of subsection (1) of section 1456 of the tax law is amended to convert the existing low income housing tax credit to a refundable low income housing tax credit for allocations of credit made subsequent to January 1, 2019. Paragraph 3 of subdivision (n) of section 1511 of the tax law is amended to convert the low income housing tax credit to a refundable tax credit for purposes of the Insurance Franchise Tax for allocations of tax credit made after January 1, 2019. Furthermore, in order to obtain treatment as a refundable credit for these taxes, a project must have received an eligibility statement from the commissioner of housing and community renewal pursuant to article two-A of the public housing law.
Justification
Tax credit programs are widely seen as the primary mechanism for successfully producing and preserving affordable rental housing. As a result of the recent financial crisis, state and federal tax credit programs have been disrupted, as is the case in New York. The problem has been further exacerbated in New York where the state tax credit is less marketable, unlike the case in many other states.
New York's low income housing credit tax program was established in 2000 pursuant to Article 2-A of the Public Housing Law and was designed to encourage the development of low income housing. Refundable housing tax credits are more desirable than non-refundable credits and would work to create a greater demand in the marketplace. This bill would permit investors to obtain a broader class of investors including banks, corpo- rations, and insurance companies and would create additional demand on the market for state tax credits. This demand would drive up pricing among investors as pricing as competition is increased. This would translate into greater private investment in affordable housing which will help drive housing development within the state.
Legislative history
2018: S.566-A Reported and Committed to Rules 2017: S.566 Passed Senate 2016: S.2277-A Passed Senate 2015: S.2277 Passed Senate 2014: S.3848-A Passed Senate 2013: S.3848 Passed Senate 2012: S.4758-C Passed Senate 2011: S.4768 Advanced to Third Reading
Fiscal implications
None.
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.