Bill > S00914

This bill creates two new separate taxes in New York State: a tax on inheritance income and a tax on gift income, while also modifying existing estate tax provisions. The inheritance income tax would apply to income received from an estate, with graduated tax rates ranging from 0% to 50% depending on the amount of inheritance. Different rates apply for residents and non-residents, and various exclusions are provided, such as educational expenses, spousal transfers, retirement accounts, and transfers of primary residences or family farms. Similarly, a gift income tax is established with comparable graduated rates, applying to taxable gifts made by New York residents or involving New York property. The bill allows for credits against these taxes for estate or inheritance taxes paid to other jurisdictions and provides liquidity deferrals for certain transfers of primary residences or family-owned businesses. Starting in 2025, the estate tax calculation will be modified to incorporate lifetime gift taxes and adjust the basic exclusion amount, with a new credit allowed for gift taxes paid during the decedent's lifetime. The gift tax provisions will take effect in 2026, with specific rules for calculating taxable gifts and corresponding tax rates.

Budget and Finance

https://www.nysenate.gov/legislation/bills/2025/S914