Amends the alternative tax table benefit recapture; increases the rate of supplemental tax for high income taxpayers.
Summary
S04437 amends New York’s personal income tax rates for the highest earners. The bill changes the tax tables for several filing statuses and raises the top marginal rate on income over $5 million and over $25 million for taxable years beginning after 2025, while also extending the higher-rate structure by removing language that would have limited it to a shorter period. It also updates the alternative tax table benefit recapture provisions so that the supplemental tax for taxpayers with New York adjusted gross income above $25 million is calculated using a 11.4% rate instead of 10.9%.
In practical terms, the bill increases the tax burden on very high-income individuals and households in New York, especially those with taxable income above $5 million and $25 million. It affects the personal income tax law in section 601 of the tax law, including the graduated rate schedules for different filing categories and the supplemental tax mechanism used to recapture tax table benefits for high-income taxpayers. The bill takes effect immediately, but the rate changes are structured to apply to taxable years beginning after 2025.
Impact
The bill amends multiple clauses of section 601 of the Tax Law, altering the top brackets in the personal income tax tables for single filers, married joint filers, and other filing statuses, and revises the supplemental tax rate under the alternative tax table benefit recapture provisions. It effectively raises the top marginal rate from 10.9% to 11.4% for income above $25 million and increases the rate on income above $5 million from 10.3% to 10.8% for the applicable post-2025 tax years. The measure directly affects high-income taxpayers and the state Department of Taxation and Finance’s administration of the personal income tax.
Sentiment
The available context suggests the bill is a revenue-raising measure aimed at very high-income taxpayers, with no recorded committee transcript or vote history indicating organized opposition or support in the provided materials. The bill’s sponsor list and amendment history suggest it was advanced through the Senate budget and revenue process, which is consistent with a policy approach focused on progressive taxation and state revenue generation. Because no votes or hearing remarks are included, the overall sentiment can only be characterized as procedurally neutral in the record provided, with the substance likely appealing to supporters of higher taxes on the wealthy and disfavored by taxpayers affected by the increase.
Contention
The main point of contention is the increase in top personal income tax rates for the highest earners, particularly the jump to 11.4% on income above $25 million and the higher supplemental tax rate. Supporters would likely view the bill as a fairness and revenue measure targeting only ultra-high-income taxpayers, while opponents would likely argue it could discourage investment, encourage tax migration, or make New York less competitive. No specific stakeholder testimony is provided, so the record does not identify named groups or legislators taking opposing positions.
Expands eligibility for pension and retirement income exclusion to taxpayers with incomes exceeding $150,000, and increases amount of exclusion that qualifying taxpayers may claim.