Establishes a first permanent payroll employee tax credit which allows a business to receive a tax credit for the three years following the employment of such business' first permanent payroll employee where such credit equals a portion of the amount it costs to employ such permanent payroll employee.
Summary
This bill establishes a new New York tax credit for businesses that hire their first full-time, permanent employee. The credit would apply for three consecutive years after that first hire, and the amount would be based on a percentage of the employer’s total cost to employ the worker, including salary, state payroll taxes, and benefits. The credit is structured at 25 percent in the first year, 20 percent in the second year, and 10 percent in the third year.
The bill applies the credit to both the corporate franchise tax and the personal income tax, and it limits the total statewide amount of credits to $15 million per year. If applications exceed that cap, the excess would roll over to the next year. The bill also prevents taxpayers from using the same wage and employment costs to claim more than one tax credit under the Tax Law, and it allows unused credit amounts to be carried forward for up to two additional taxable years.
Impact
The bill would amend sections 210-B and 606 of the Tax Law to add a new first permanent payroll employee credit for eligible taxpayers. It would create a new incentive aimed at very small businesses or newly hiring employers by reducing state tax liability tied to the cost of a first permanent employee. The measure would take effect immediately and apply to taxable years beginning on or after January 1, 2025, affecting both business taxpayers and the Department of Taxation and Finance’s administration of credit allocation.
Sentiment
Based on the bill text and the absence of recorded committee debate or votes, the measure appears to be framed as a pro-business, job-creation incentive with a generally supportive policy rationale. The sponsor list suggests interest from senators aligned with reducing costs for employers and encouraging hiring. No formal opposition is reflected in the provided materials, but the bill’s capped annual credit pool indicates an effort to limit fiscal exposure.
Contention
The main potential point of contention is fiscal cost versus economic benefit: supporters are likely to view the credit as a way to help businesses make their first hire, while critics may question whether the $15 million annual cap is sufficient or whether the credit would meaningfully increase employment. Another possible issue is eligibility and administration, since the credit is limited to a taxpayer’s first full-time, permanent employee and depends on payroll-record verification, which may raise questions about complexity, compliance, and whether the benefit is targeted narrowly enough. No specific objections or amendments are shown in the available legislative history.
Same As
Establishes a first permanent payroll employee tax credit which allows a business to receive a tax credit for the three years following the employment of such business' first permanent payroll employee where such credit equals a portion of the amount it costs to employ such permanent payroll employee.
Establishes a first permanent payroll employee tax credit which allows a business to receive a tax credit for the three years following the employment of such business' first permanent payroll employee where such credit equals a portion of the amount it costs to employ such permanent payroll employee.
Establishes a first permanent payroll employee tax credit which allows a business to receive a tax credit for the three years following the employment of such business' first permanent payroll employee where such credit equals a portion of the amount it costs to employ such permanent payroll employee.
Establishes a first permanent payroll employee tax credit which allows a business to receive a tax credit for the three years following the employment of such business' first permanent payroll employee where such credit equals a portion of the amount it costs to employ such permanent payroll employee.