Bill Text: NY S05113 | 2025-2026 | General Assembly | Introduced

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Bill Title: Includes retirement plans in the exemption for pensions and annuities for certain persons; increases such exemption to one hundred thousand dollars as adjusted by the consumer price index annually.

Spectrum: Partisan Bill (Republican 1-0)

Status: (Introduced) 2025-02-19 - REFERRED TO BUDGET AND REVENUE [S05113 Detail]

Download: New_York-2025-S05113-Introduced.html

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                STATE OF NEW YORK
        ________________________________________________________________________

                                          5113

                               2025-2026 Regular Sessions

                    IN SENATE

                                    February 19, 2025
                                       ___________

        Introduced  by Sen. BORRELLO -- read twice and ordered printed, and when
          printed to be committed to the Committee on Budget and Revenue

        AN ACT to amend the tax law, in relation to including  retirement  plans
          in the exemption for pensions and annuities for certain persons and to
          increasing such exemption

          The  People of the State of New York, represented in Senate and Assem-
        bly, do enact as follows:

     1    Section 1. Paragraph 3-a of subsection (c) of section 612 of  the  tax
     2  law,  as  amended  by  section  3 of part I of chapter 59 of the laws of
     3  2015, is amended to read as follows:
     4    (3-a) Pensions [and], annuities and other retirement plans received by
     5  an individual who has attained the age of fifty-nine and  one-half,  not
     6  otherwise  excluded  pursuant  to paragraph three of this subsection, to
     7  the extent includible in gross income for federal income  tax  purposes,
     8  but  not  in  excess  of [twenty] forty thousand dollars for any taxable
     9  year beginning on or after January  first,  two  thousand  twenty-seven,
    10  sixty thousand dollars  for  any   taxable year beginning  on  or  after
    11  January  first,  two  thousand twenty-eight, eighty thousand dollars for
    12  any taxable  year  beginning  on  or  after  January   first, two  thou-
    13  sand  twenty-nine,  one  hundred  thousand  dollars for any taxable year
    14  beginning on or after January first, two thousand thirty, multiplied  by
    15  one  plus  the  percentage  by  which  the  consumer price index for the
    16  preceding calendar year exceeds the consumer price index for the taxable
    17  year beginning on or after January first, two thousand thirty, which are
    18  periodic payments attributable to personal services  performed  by  such
    19  individual  prior to [his] their retirement from employment, which arise
    20  (i) from an employer-employee relationship or (ii) from contributions to
    21  a retirement plan which are deductible for federal income tax  purposes.
    22  However,  the  term "pensions and annuities" shall also include distrib-
    23  utions received by an individual who has attained the age of  fifty-nine
    24  and  one-half  from  an  individual  retirement account or an individual

         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD05032-01-5
        S. 5113                             2

     1  retirement annuity, as defined in section  four  hundred  eight  of  the
     2  internal  revenue  code, and distributions received by an individual who
     3  has attained the age of fifty-nine and one-half from self-employed indi-
     4  vidual  and  owner-employee retirement plans which qualify under section
     5  four hundred one of the  internal  revenue  code,  whether  or  not  the
     6  payments  are  periodic  in nature. Nevertheless, the term "pensions and
     7  annuities" shall not include any lump sum distribution,  as  defined  in
     8  subparagraph  (D)  of  paragraph  four of subsection (e) of section four
     9  hundred two of the internal revenue code and  taxed  under  section  six
    10  hundred three of this article. Where [a husband and wife] spouses file a
    11  joint state personal income tax return, the modification provided for in
    12  this  paragraph  shall be computed as if they were filing separate state
    13  personal income tax returns. Where a payment would otherwise come within
    14  the meaning of the term "pensions and annuities" as set  forth  in  this
    15  paragraph,  except that such individual is deceased, such payment shall,
    16  nevertheless, be treated as a pension or annuity for  purposes  of  this
    17  paragraph  if such payment is received by such individual's beneficiary.
    18  For purposes of this paragraph, "consumer price index" means the average
    19  of the consumer price index as of the close of the  twelve-month  period
    20  ending on August thirty-first of such taxable year for all-urban consum-
    21  ers published by the United States department of labor.
    22    § 2. This act shall take effect immediately.