Personal Income Tax Brackets*
- Taxpayers earning $40,000 to $150,000 will be taxed at 6.45% (currently 6.85%);
- Taxpayers earning $150,000 to $300,000 will be taxed at 6.65% (currently 6.85%);
- Taxpayers earning $300,000 to $2 million will be taxed at 6.85% (currently 7.85% to 8.97%); and
- Taxpayers earning over $2 million will be taxed at 8.82% (currently 8.97%).
For taxpayers with other filing statuses, the top 8.82% rate will apply to head of household filers with New York taxable income over $1.5 million and to single filers with New York taxable income over $1 million. The legislation also provides for a cost of living adjustment to the brackets and the standard deduction.
*The legislation also provides a 50% rate reduction (from 6.5% to 3.25%) under the corporate franchise tax for eligible qualified New York manufacturers for the 2012 to 2014 tax years. The Commissioner of Taxation and Finance is also required to establish guidelines and criteria specifying the requirements for a manufacturer to be classified as an "eligible qualified New York manufacturer." The criteria may include factors such as regional unemployment, the economic impact that manufacturing has on the surrounding community, population decline within the region, and median income within the region.
In addition, beginning with the 2012 tax year, the legislation creates the Empire State Jobs Retention Program, which provides credits to targeted businesses harmed by a natural disaster. The credit will be available to firms with at least 100 employees that have retained or expanded their workers' roles following a natural disaster. The credit is equal 6.85% of the wages of retained jobs and is targeted towards employers in financial services, manufacturing, software development, new media, scientific development, agriculture, and other sectors.
- 0.11% for employers with payroll expense no greater than $375,000 in any calendar quarter;
- 0.23% for employers with payroll expense no greater than $437,500 in any calendar quarter; and
- 0.34% for employers with payroll expense exceeding $437,500 in any calendar quarter.
For self-employed individuals, tax at the rate of 0.34% will apply if earnings attributable to the MCTD exceed $50,000 (rather than $10,000) for the tax year.
Eligible municipalities have the option to allow a reduction in the assessment of a property that has lost at least 50% of its value due to hurricane or storm damage. The assessment reductions range from 55% for property that has lost between 50% and less than 60% of its taxable assessed value to 95% for property that has lost between 90% and less than 100% of its value. If a property has lost all of its value due to storm-related damage, the taxable assessed value is reduced to zero.
Furthermore, a school district that is located in a declared federal disaster county may adopt, by resolution and within the six months preceding the due date for school taxes, an installment payment schedule, with amounts and dates specified in the resolution. A school district is authorized to refund any portion of taxes previously paid if the school board adopts an installment payment resolution.