Bill Text: NY A01818 | 2025-2026 | General Assembly | Introduced
Bill Title: Imposes an excise tax on the failure of certain hedge funds owning excess single-family residences to dispose of such residences; establishes the housing down payment trust fund to provide funds to state housing finance agencies to establish new or supplement existing programs that provide down payment assistance to families purchasing homes within the state.
Spectrum: Partisan Bill (Democrat 2-0)
Status: (Introduced) 2025-01-14 - referred to ways and means [A01818 Detail]
Download: New_York-2025-A01818-Introduced.html
STATE OF NEW YORK ________________________________________________________________________ 1818 2025-2026 Regular Sessions IN ASSEMBLY January 14, 2025 ___________ Introduced by M. of A. SOLAGES, RAGA -- read once and referred to the Committee on Ways and Means AN ACT to amend the tax law, in relation to impose an excise tax on the failure of certain hedge funds owning excess single-family residences to dispose of such residences; and to amend the state finance law, in relation to establishing the housing down payment trust fund and directing the commissioner of the state division of housing and commu- nity renewal to establish a grant program The People of the State of New York, represented in Senate and Assem- bly, do enact as follows: 1 Section 1. Short title. This act shall be known and may be cited as 2 the "End Hedge Fund Control of New York Homes Act". 3 § 2. The tax law is amended by adding a new article 20-E to read as 4 follows: 5 ARTICLE 20-E 6 EXCISE TAX ON CERTAIN TAXPAYERS FAILING 7 TO SELL EXCESS SINGLE-FAMILY RESIDENCES 8 Section 500. Definitions. 9 500-a. Imposition of tax. 10 500-b. Maximum permissible units. 11 500-c. Construction. 12 500-d. Reporting. 13 500-e. Tax form. 14 500-f. Certification. 15 500-g. Use of tax revenues. 16 § 500. Definitions. For purposes of this article, the following defi- 17 nitions shall apply: 18 1. "Applicable date" means: 19 (a) the last day of the first full taxable year ending on or after the 20 effective date of this article; or EXPLANATION--Matter in italics (underscored) is new; matter in brackets [] is old law to be omitted. LBD03737-01-5A. 1818 2 1 (b) in the case of any taxpayer that changes its status during a taxa- 2 ble year, the last day of the taxable year immediately preceding the 3 taxable year in which the taxpayer changed its status. 4 2."Applicable single-family residence" means any single-family resi- 5 dence which was acquired on or before the applicable date. 6 3. (a) "Applicable taxpayer" means a taxpayer, including a partner- 7 ship, corporation, trust or other legal entity, that: 8 (i) manages funds pooled from investors and is a fiduciary with 9 respect to such investors; and 10 (ii) is an asset manager in any of the following asset classes: 11 (A) public equity or fixed income securities; 12 (B) a hedge fund; 13 (C) a fund of hedge funds; 14 (D) private equity (including venture capital); 15 (E) a fund of private equity funds; 16 (F) a real estate investment fund; 17 (G) a fund of real estate funds; or 18 (H) any other asset class for which an applicable fiduciary-controlled 19 entity engages external asset managers; and 20 (iii) that has fifty million dollars or more in net value or assets 21 under management on any day during the taxable year. 22 (b) "Applicable taxpayer" shall not include: 23 (i) an organization which is described in section 501(c)(3) and exempt 24 from tax under section 501(a) of the Internal Revenue Code; or 25 (ii) an organization primarily engaged in the construction or rehabil- 26 itation of single-family residences. 27 4. "Disqualified sale" means any sale or transfer of a single-family 28 residence to: 29 (a) a corporation or other entity engaged in a trade or business; or 30 (b) an individual who owns any other single-family residence at the 31 time of such sale or transfer. 32 5. "Newly acquired single-family residence" means any single-family 33 residence which was acquired by the taxpayer in any taxable year which 34 begins after the effective date of this article. 35 6. "Single-family residence" means a residential property consisting 36 of one to four dwelling units; provided that such term shall not 37 include: 38 (a) any unoccupied single-family residence acquired through foreclo- 39 sure; 40 (b) any single-family residence that is: 41 (i) not rented or leased, and 42 (ii) used as the principal residence of any person who has an owner- 43 ship interest in the applicable taxpayer; or 44 (c) any single-family residence constructed, acquired, or operated 45 with Federal appropriated funding sources. 46 7. "Trade or business" shall include any activity treated as a trade 47 or business under paragraph (5) or (6) of section 469(c) of the Internal 48 Revenue Code (determined without regard to the phrase 'To the extent 49 provided in regulations' in such paragraph (6)). 50 § 500-a. Imposition of tax. 1. In the case of an applicable taxpayer, 51 there is hereby imposed a tax on the acquisition of any newly acquired 52 single-family residence equal to fifty percent of the fair market value 53 of such residence. 54 2. (a) In the case of an applicable taxpayer who fails to meet the 55 requirements of subdivision (b) of this section there is hereby imposed 56 a tax equal to the product of:A. 1818 3 1 (i) fifty thousand dollars, and 2 (ii) the excess of: 3 (A) the number of applicable single-family residences owned by the 4 taxpayer as of the last day of the taxable year, over 5 (B) the maximum permissible units for the taxable year. 6 (b) An applicable taxpayer meets the requirement of this subdivision 7 for any taxable year if the number of applicable single-family resi- 8 dences owned by the taxpayer as of the last day of the taxable year is 9 equal to or less than the maximum permissible units determined with 10 respect to such taxpayer for such taxable year. For purposes of this 11 paragraph, a single-family residence which is sold or transferred in a 12 disqualified sale during the taxable year shall be treated as a single- 13 family residence which is owned by the applicable taxpayer as of the 14 last day of such taxable year. 15 § 500-b. Maximum permissible units. The maximum permissible units with 16 respect to any applicable taxpayer for any taxable year shall be deter- 17 mined as follows: 18 In the case of: The maximum permissible units 19 for an applicable taxpayer is: 20 the first full taxable ninety percent of the number of applicable 21 year beginning after the single-family residences owned by 22 applicable date the taxpayer on the applicable date 23 the second taxable year eighty percent of the number of applicable 24 beginning after the single-family residences owned by 25 applicable date the taxpayer on the applicable date 26 the third taxable year seventy percent of the number of applicable 27 beginning after the single-family residences owned by 28 applicable date the taxpayer on the applicable date 29 the fourth taxable year sixty percent of the number of applicable 30 beginning after the single-family residences owned by 31 applicable date the taxpayer on the applicable date 32 the fifth taxable year fifty percent of the number of applicable 33 beginning after the single-family residences owned by 34 applicable date the taxpayer on the applicable date 35 the sixth taxable year forty percent of the number of applicable 36 beginning after the single-family residences owned by 37 applicable date the taxpayer on the applicable date 38 the seventh taxable year thirty percent of the number of applicable 39 beginning after the single-family residences owned by 40 applicable date the taxpayer on the applicable date 41 the eighth taxable year twenty percent of the number of applicable 42 beginning after the single-family residences owned by 43 applicable date the taxpayer on the applicable date 44 the ninth taxable year ten percent of the number of applicable 45 beginning after the single-family residences owned by 46 applicable date the taxpayer on the applicable dateA. 1818 4 1 any taxable year beginning 0 2 more than nine years after 3 the applicable date 4 § 500-c. Construction. 1. For purposes of this article, an applicable 5 taxpayer shall be treated: 6 (a) as acquiring a single-family residence if the applicable taxpayer 7 acquires a majority ownership interest in the single-family residence, 8 regardless of the percentage of that ownership interest; and 9 (b) as owning a single-family residence if the applicable taxpayer 10 owns a majority ownership interest in the single-family residence, 11 regardless of the percentage of that ownership interest. 12 2. For purposes of this article, all persons or entities that are 13 treated as a single employer under subsections (a) and (b) of section 52 14 of the Internal Revenue Code shall be treated as a single person or 15 entity. 16 § 500-d. Reporting. 1. The commissioner shall require such reporting 17 as the commissioner determines necessary or appropriate to carry out the 18 purposes of this section, including reporting with respect to: 19 (a) the dates on which single-family residences owned by an applicable 20 taxpayer were acquired by such taxpayer; and 21 (b) whether any person acquiring a single-family residence from an 22 applicable taxpayer owns any other single-family residences at the time 23 of the acquisition. 24 2. Any person who fails to report information required under subdivi- 25 sion one of this section or who fails to include correct information in 26 such report shall pay a penalty of twenty thousand dollars; provided, 27 however, that no such penalty shall be imposed with respect to any fail- 28 ure if it is shown that such failure is due to reasonable cause and not 29 to willful neglect. The penalty under this subdivision shall be paid 30 upon notice and demand by the commissioner. 31 § 500-e. Tax form. Not later than one hundred eighty days after the 32 effective date of this article, the commissioner, or the commissioner's 33 delegate, shall publish a form to be used for calculating the amount of 34 tax owed under this article. 35 § 500-f. Certification. 1. The reporting required under subparagraph 36 (b) of subdivision one of section five hundred-d of this article, shall 37 include a certification from each individual to whom a single-family 38 residence is sold or transferred from an applicable taxpayer. 39 2. The certification required under this section shall be signed by 40 the purchaser or transferee and state the following: 41 (a) the name and address of the purchaser or transferee; 42 (b) that the sale is not a disqualified sale; and 43 (c) that the purchaser or transferee will be subject to the penalty 44 imposed under subdivision two of section five hundred-d of this article 45 for any false certification. 46 § 500-g. Use of tax revenues. All revenues from taxes collected under 47 this article shall be deposited into the housing down payment trust fund 48 established by section eighty-b of the state finance law and shall be 49 used only for the purposes specified in such section. 50 § 3. The state finance law is amended by adding a new section 80-b to 51 read as follows: 52 § 80-b. Housing down payment trust fund. 1. There is established in 53 custody of the state comptroller a special fund to be known as "the 54 housing down payment trust fund" (hereinafter in this section referred 55 to as the 'trust fund').A. 1818 5 1 2. The trust fund shall consist of moneys appropriated thereto, moneys 2 transferred from any other fund or sources, and all excise tax, penal- 3 ties and forfeitures collected pursuant to article twenty-E of the tax 4 law. Nothing contained in this section shall prevent the state from 5 receiving grants, gifts or bequests for the purposes of the trust fund 6 as defined in this section and depositing them into the trust fund 7 according to law. 8 3. The moneys in the trust fund shall be kept separate from and shall 9 not be commingled with any other moneys in the custody of the state 10 comptroller. Such moneys shall be made available to the commissioner of 11 the state division of housing and community renewal for the grants 12 program for down payment assistance programs as provided in subdivision 13 four of this section. 14 4. The commissioner of the state division of housing and community 15 renewal shall establish a program under which said commissioner makes 16 grants to state housing finance agencies to establish new or supplement 17 existing programs that provide down payment assistance to families 18 purchasing homes within the state. A state housing finance agency that 19 receives a grant under this section shall give priority to families 20 seeking assistance to purchase any single-family residence that is sold 21 or transferred by an applicable taxpayer as defined in article twenty-E 22 of the tax law. The commissioner of the state division of housing and 23 community renewal shall establish the application criteria and quali- 24 fications for the state housing finance agencies for the purposes of the 25 trust fund as defined in this section. The commissioner of the state 26 division of housing and community renewal may enter into contracts with 27 such qualified state housing finance agencies which may thereafter be 28 renewed, extended or succeeded by new contracts from year to year in the 29 discretion of the commissioner of the state division of housing and 30 community renewal. 31 5. The monies shall be payable from the trust fund on the audit and 32 warrant of the comptroller on vouchers approved and certified by the 33 commissioner of the state division of housing and community renewal. 34 6. No later than the fifteenth day of January of each year the commis- 35 sioner of the state division of housing and community renewal shall 36 report to the governor, the temporary president of the senate and the 37 speaker of the assembly on activities undertaken by the commissioner of 38 the state division of housing and community renewal and any grantee 39 pursuant to this section in the preceding year. The report shall 40 include, but not be limited to, the current amount of funds available as 41 well as the amount of money granted to any state housing finance agen- 42 cies for the purposes identified in this section. 43 § 4. This act shall take effect immediately and shall apply to taxable 44 years beginning on and after the effective date of this act.
