Bill > S08632

This bill modifies the existing tax law related to the New York State tax credit for household and dependent care services necessary for gainful employment. The bill updates the calculation of the credit by adjusting income thresholds and introducing new provisions for taxpayers with varying income levels. Specifically, for taxable years beginning after 2017, the bill establishes a graduated factor system for taxpayers with adjusted gross incomes between $50,000 and $150,000, which will increase the credit percentage based on income brackets. Starting in 2026, the bill also introduces a reduction mechanism where the credit will decrease by $20 for every $1,000 of income above $500,000 for individual filers (or $1 million for joint returns), though the credit cannot be reduced below zero. Additionally, the bill references changes to the federal Internal Revenue Code (specifically Public Law 119-21) and ensures that the credit calculation references the tax code as it existed before that law's enactment. The bill also clarifies credit application for different taxpayer scenarios, including residents, non-residents, and part-year residents, and makes language updates such as replacing "husband and wife" with "spouses". The changes will take effect immediately and apply to taxable years beginning on or after January 1, 2026.

Budget and Finance

https://www.nysenate.gov/legislation/bills/2025/S8632