Senate Bill S8631

2025-2026 Legislative Session

Relates to the treatment of certain deductions allowable under the internal revenue code in calculating federal adjusted gross income

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Current Bill Status - In Senate Committee Budget And Revenue Committee

Introduced
- In Committee Assembly
- In Committee Senate
- On Floor Calendar Assembly
- On Floor Calendar Senate
- Passed Assembly
- Passed Senate
Delivered to Governor
Signed By Governor

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Date of Action	Assembly Actions - Lowercase Senate Actions - UPPERCASE
Feb 10, 2026	print number 8631a
Feb 10, 2026	amend and recommit to budget and revenue
Jan 07, 2026	referred to budget and revenue
Dec 22, 2025	referred to rules

Bill Amendments

Original

A (Active)

2025-S8631 - Details

Current Committee:: Senate Budget And Revenue
Law Section:: Tax Law
Laws Affected:: Amd §612, Tax L

2025-S8631 - Summary

Provides that certain deductions allowable under the internal revenue code related to certain types of property and domestic research or experimental expenditures shall be added to federal adjusted gross income.

2025-S8631 - Sponsor Memo

                                 
BILL NUMBER: S8631

SPONSOR: GOUNARDES
 
TITLE OF BILL:

An act to amend the tax law, in relation to the treatment of certain
deductions allowable under the internal revenue code in calculating
federal adjusted gross income

 
PURPOSE OR GENERAL IDEA OF BILL:

This bill would pause conformity in the Tax Law to changes made to the
Internal Revenue Code of the United States by Public Law 119-21.

 
SUMMARY OF PROVISIONS:

Section one amends subsection (b) of section 612 of the Tax Law to add a
new paragraph 44 to decouple the New York State tax code from section
168(n) of the Internal Revenue Code (IRC), which creates a new first-
year expensing business deduction for certain types of property placed
in service before the end of 2030.

Section two amends subsection (b) of section 612 of the Tax Law to add a
new paragraph 45 to decouple the New York State tax code from section
174A(b) of the IRC, which allows first-year expensing for certain
research and experimentation (R&E) expenditures.

Section three amends subsection (b) of section 612 of the Tax Law to
create a new paragraph 46 to decouple the New York State tax code from
section 179 of the IRC, which increases the cap of covered business
expenses which may be expensed in a single year from $1 million to $2.5
million.

Section four sets the effective date.

 
JUSTIFICATION:

The 2025 One Big Beautiful Bill Act (OBBBA) One Big Beautiful Bill Act
caused three major changes to corporate expensing under the federal
Internal Revenue Code which will cost New York a staggering amount of
revenue without returning any notable benefits. By letting businesses
write off expenses for long-lasting products in their first year of use,
these provisions are essentially a corporate giveaway.

Because corporate income taxes are intended to be a levy on only net
income, or profits, the IRC generally lets businesses deduct expenses
like compensation, the cost of purchasing goods, and other ordinary
business expenses. The IRC distinguishes between short vs. long-term
expenses, however, by requiring businesses to deduct them over two
different types of timelines: a taxpayer can deduct an expense in the
year in which it was incurred for items used within the year like
employee compensation, travel expenses, food, or other supplies; or they
can deduct it over the expected life of the product for long-term
investments like buildings and machinery. This latter method of
deduction is called depreciation or amortization, and reflects the basic
maxim that a tax deduction should reflect the actual deterioration of
the item being expensed.


Despite this tax maxim, certain provisions of the IRC allow for immedi-
ate, year one expensing for items with a long shelf life as an alleged
means of spurring investment and increasing a business's cash flow.
While NYS has already decoupled from certain parts of the IRC that allow
expensing, there are three specific provisions to which the state remain
coupled which were recently dramatically expanded under OBBBA.

Firstly, OBBBA created a new business expensing deduction under IRC §
168(n) for "qualified production property" which includes manufacturing,
agricultural production, chemical production, and refining facilities
placed in service by the end of 2030. New York has historically not
allowed expensing for real property, as buildings are a classic example
of a long-lived asset that should be deducted over time, which is why
the legislature decoupled years ago from generalized "bonus depreci-
ation" under IRC § 168(k) after studies found that this tax break led to
little new investment and returned only 27 cents on the dollar. Since we
have already decoupled from IRC § 168(k), there is little reason to
remain coupled to only IRC § 168(n), which is an even more targeted
corporate handout. As described by ITEP, "(§ 168(n)) means...that a
highly profitable corporation can make it appear that it does not have
any taxable profits at all, so long as it is buying up equipment and
building factories."' Furthermore, remaining coupled to IRC § 168(n)
will cost the state $370 million in the 2026 tax year.2

Secondly, OBBBA restores a previous provision in IRC § 174a that had
allowed businesses to immediately write off research and experimentation
(R&E) expenses despite the fact that the vast majority of R&E invest-
ments, like software and machinery, have more than a one-year shelf
life. OBBBA also allows businesses with less than $31 million of
receipts in 2025 to retroactively deduct R&E expenses that were made
between 2022 and 2025. As ITEP notes, not only does this type of immedi-
ate expensing for R&E investments not match economic reality, but allow-
ing expensing for R&E purchases that were already made is pure windfall,
as the legislature cannot incentivize investments that have already
happened.' Failing to decouple from IRC § 174a could cost the state up
to a staggering $2.422 billion in tax year 2026.2

Finally, New York remains coupled to IRC § 179, which allows year one
expensing for qualifying assets like machinery, equipment, software, and
property improvements (i.e. roofing, HVAC, security systems) that are
below a certain dollar amount. Businesses have historically been allowed
to write off up to $1 million of long-term assets in a single tax year
so long as total purchase price of such assets remained below $2.5
million. Businesses could purchase assets of more than $2.5 million and
take the § 179 deduction, but the $1 million deduction would then start
to phase out dollar by dollar, with each dollar above the $2.5 million
threshold reducing a dollar of the $1 million deduction.3 OBBBA more
than doubles the writeoff cap in IRC § 179 from $1 million to $2.5
million, while pushing the phaseout threshold from $2.5 million to $4
million. These caps are also indexed to inflation.

While IRC § 179 is frequently represented by proponents as a tax boon
for small businesses, its expansion is illogical for three reasons:  1)
it violates the economic principle outlined above that long-term assets
should be deducted over time; 2) analysis generally suggests that the
increased investment spurred by IRC § 179 does not offset lost tax
revenue; and 3) it's extremely unclear how much raising the expense cap
actually increases investment in small businesses as opposed to just
including larger businesses. Remaining coupled to IRC § 179 will cost
the state $68 million in tax year 2026.

Evidence suggests that even at the national level, these tax breaks lose
far more revenue than any economic activity they might bring in, and
each provision favors certain industries over others. But business
expensing makes even less sense at a state level, since, as ITEP
explains, state taxes on corporations who do business in multiple states
are calculated by: "1. Taking the company's nationwide gross receipts,
2. Subtracting nationwide deductions, and 3. Taxing the state's share of
that nationwide profit" Accordingly, New York taxpayers may be taking
deductions on investments that did not even occur in-state, causing
massive revenue losses with no investment gain.1

Taken together, these three business expensing expansions in OBBBA will
cost the state up to a staggering $2.86 billion in 2026.2 Decoupling
from this regressive federal tax bill, which as a whole will send one-
third of its net tax reductions to those making over $500,000 by 2027,
will save the state billions of dollars in lost revenue while avoiding
the pitfalls of wasteful and ineffective corporate handouts.4

 
PRIOR LEGISLATIVE HISTORY:

None

 
FISCAL IMPLICATIONS:

This bill will save the state $2.86 billion in 2026.

 
EFFECTIVE DATE:
Immediate
1 Mazerov, Michael, and Nick Johnson. "Why States Shouldn't Go along
with OBBBA's Corporate Tax Breaks: A Practical Guide." ITEP, Institute
on Taxation and Economic Policy (ITEP), 27 Oct. 2025, itep.org/states-
obbba-corporate-tax-breaks-a-practical-guide/.  Accessed 5 Dec. 2025.
2 Higgs, Milly. "The One Big Beautiful Bill Act Gets Expensing Right.
States Should Follow Suit." Tax Foundation, 22 July 2025,
taxfoundation.org/blogione-big-beautiful-bill-expensing-state-tax-confor
mity/. Accessed 5 Dec. 2025.
3 Lautz, Andrew. The 2025 Tax Debate: Section 179 Expensing for Small
Businesses I Bipartisan Policy Center." Bipartisanpolicy.org, Bipartisan
Policy Center, 19 July 2025,
bipartisanpolicy.org/explainer/the-2025-tax-debate-section-179-expensing
-for-small-businesses/.
4 New York State Comptroller Thomas DiNapoli. Tax Provisions under the
Federal Reconciliation Bill. Sept. 2025.

2025-S8631 - Bill Text download pdf

                             
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   8631
 
                        2025-2026 Regular Sessions
 
                             I N  S E N A T E
 
                             December 22, 2025
                                ___________
 
 Introduced by Sen. GOUNARDES -- read twice and ordered printed, and when
   printed to be committed to the Committee on Rules
 
 AN  ACT  to  amend  the tax law, in relation to the treatment of certain
   deductions allowable under the internal revenue  code  in  calculating
   federal adjusted gross income

   THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section 1. Subsection (b) of section 612 of the tax law is amended  by
 adding three new paragraphs 44, 45 and 46 to read as follows:
   (44)  FOR  TAXABLE  YEARS  BEGINNING  AFTER DECEMBER THIRTY-FIRST, TWO
 THOUSAND TWENTY-FOUR, IN  THE  CASE  OF  QUALIFIED  PRODUCTION  PROPERTY
 DESCRIBED  IN  PARAGRAPH  TWO  OF  SUBSECTION (N) OF SECTION ONE HUNDRED
 SIXTY-EIGHT OF THE INTERNAL REVENUE CODE, WITH RESPECT TO SUCH  PROPERTY
 THE  AMOUNT  OF  THE  DEPRECIATION DEDUCTION ALLOWABLE UNDER SECTION ONE
 HUNDRED SIXTY-SEVEN OF THE INTERNAL REVENUE CODE AS SUCH SECTION WAS  IN
 EFFECT  FOR  TAXABLE  YEARS BEGINNING BEFORE JANUARY FIRST, TWO THOUSAND
 TWENTY-FIVE.
   (45) FOR TAXABLE YEARS  BEGINNING  AFTER  DECEMBER  THIRTY-FIRST,  TWO
 THOUSAND  TWENTY-FOUR,  IN THE CASE OF DOMESTIC RESEARCH OR EXPERIMENTAL
 EXPENDITURES DESCRIBED IN SUBSECTION (B) OF SECTION ONE  HUNDRED  SEVEN-
 TY-FOUR-A OF THE INTERNAL REVENUE CODE, WITH RESPECT TO SUCH EXPENDITURE
 THE  AMOUNT  OF  THE  DEDUCTION ALLOWABLE FOR FOREIGN RESEARCH OR EXPER-
 IMENTAL EXPENDITURES UNDER  SECTION  ONE  HUNDRED  SEVENTY-FOUR  OF  THE
 INTERNAL REVENUE CODE.
   (46)  FOR  TAXABLE  YEARS  BEGINNING  AFTER DECEMBER THIRTY-FIRST, TWO
 THOUSAND TWENTY-FOUR, IN THE CASE OF SECTION 179 PROPERTY  DESCRIBED  IN
 SUBSECTION  (D)  OF  SECTION  ONE  HUNDRED  SEVENTY-NINE OF THE INTERNAL
 REVENUE CODE, WITH RESPECT TO SUCH PROPERTY THE AMOUNT OF THE  DEDUCTION
 ALLOWABLE UNDER SECTION ONE HUNDRED SEVENTY-NINE OF THE INTERNAL REVENUE
 CODE  AS  SUCH  SECTION WAS IN EFFECT FOR TAXABLE YEARS BEGINNING BEFORE
 JANUARY FIRST, TWO THOUSAND TWENTY-FIVE.
   § 2. This act shall take effect immediately.
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.

                                                            LBD14215-01-5

2025-S8631A (ACTIVE) - Details

Current Committee:: Senate Budget And Revenue
Law Section:: Tax Law
Laws Affected:: Amd §612, Tax L

2025-S8631A (ACTIVE) - Summary

2025-S8631A (ACTIVE) - Sponsor Memo

                                 
BILL NUMBER: S8631A

SPONSOR: GOUNARDES
 
TITLE OF BILL:

An act to amend the tax law, in relation to the treatment of certain
deductions allowable under the internal revenue code in calculating
federal adjusted gross income

 
PURPOSE OR GENERAL IDEA OF BILL:

This bill would pause conformity in the Tax Law to changes made to the
Internal Revenue Code of the United States by Public Law 119-21.

 
SUMMARY OF PROVISIONS:

Section One amends paragraph (a) of subdivision 9 of section 208 of the
tax law Section Two amends paragraph (b) of subdivision 9 of section 208
of the tax law Section Three amends subsection (b) of section 612 of the
tax law

Section Four amends subsection (c) of section 612 of the tax law

Section Five amends paragraph 1 of subdivision (b) of section 1503 of
the tax law

Section Six amends paragraph 2 of subdivision (b) of section 1503 of the
tax law

Section Seven sets the effective date

 
DIFFERENCE BETWEEN ORIGINAL AND AMENDED VERSION:

The A print makes technical corrections to the bill by the addition of
the deduction calculation provisions to Section 208 of the Tax Law and
to Section 1503 of the Tax Law.

 
JUSTIFICATION:

The 2025 One Big Beautiful Bill Act (OBBBA) One Big Beautiful Bill Act
caused three major changes to corporate expensing under the federal
Internal Revenue Code which will cost New York a staggering amount of
revenue without returning any notable benefits. By letting businesses
write off expenses for long-lasting products in their first year of use,
these provisions are essentially a corporate giveaway.

Because corporate income taxes are intended to be a levy on only net
income, or profits, the IRC generally lets businesses deduct expenses
like compensation, the cost of purchasing goods, and other ordinary
business expenses. The IRC distinguishes between short vs. long-term
expenses, however, by requiring businesses to deduct them over two
different types of timelines: a taxpayer can deduct an expense in the
year in which it was incurred for items used within the year like
employee compensation, travel expenses, food, or other supplies; or they
can deduct it over the expected life of the product for long-term
investments like buildings and machinery. This latter method of
deduction is called depreciation or amortization, and reflects the basic
maxim that a tax deduction should reflect the actual deterioration of
the item being expensed.
Despite this tax maxim, certain provisions of the IRC allow for immedi-
ate, year one expensing for items with a long shelf life as an alleged
means of spurring investment and increasing a business's cash flow.
While NYS has already decoupled from certain parts of the IRC that allow
expensing, there are three specific provisions to which the state remain
coupled which were recently dramatically expanded under OBBBA.

Firstly, OBBBA created a new business expensing deduction under IRC §
168(n) for "qualified production property" which includes manufacturing,
agricultural production, chemical production, and refining facilities
placed in service by the end of 2030. New York has historically not
allowed expensing for real property, as buildings are a classic example
of a long-lived asset that should be deducted over time, which is why
the legislature decoupled years ago from generalized "bonus depreci-
ation" under IRC § 168(k) after studies found that this tax break led to
little new investment and returned only 27 cents on the dollar. Since we
have already decoupled from IRC § 168(k), there is little reason to
remain coupled to only IRC § 168(n), which is an even more targeted
corporate handout. As described by ITEP, "(§ 168(n)) means...that a
highly profitable corporation can make it appear that it does not have
any taxable profits at all, so long as it is buying up equipment and
building factories."' Furthermore, remaining coupled to IRC § 168(n)
will cost the state $370 million in the 2026 tax year.

Secondly, OBBBA restores a previous provision in IRC § 174a that had
allowed businesses to immediately write off research and experimentation
(R&E) expenses despite the fact that the vast majority of R&E invest-
ments, like software and machinery, have more than a one-year shelf
life. OBBBA also allows businesses with less than $31 million of
receipts in 2025 to retroactively deduct R&E expenses that were made
between 2022 and 2025. As ITEP notes, not only does this type of immedi-
ate expensing for R&E investments not match economic reality, but allow-
ing expensing for R&E purchases that were already made is pure windfall,
as the legislature cannot incentivize investments that have already
happened.' Failing to decouple from IRC § 174a could cost the state up
to a staggering $2.422 billion in tax year 2026.(2)

Finally, New York remains coupled to IRC § 179, which allows year one
expensing for qualifying assets like machinery, equipment, software, and
property improvements (i.e. roofing, HVAC, security systems) that are
below a certain dollar amount. Businesses have historically been allowed
to write off up to $1 million of long-term assets in a single tax year
so long as total purchase price of such assets remained below $2.5
million. Businesses could purchase assets of more than $2.5 million and
take the § 179 deduction, but the $1 million deduction would then start
to phase out dollar by dollar, with each dollar above the $2.5 million
threshold reducing a dollar of the $1 million deduction.3 OBBBA more
than doubles the writeoff cap in IRC § 179 from $1 million to $2.5
million, while pushing the phaseout threshold from $2.5 million to $4
million. These caps are also indexed to inflation.

While IRC § 179 is frequently represented by proponents as a tax boon
for small businesses, its expansion is illogical for three reasons:  1)
it violates the economic principle outlined above that long-term assets
should be deducted over time; 2) analysis generally suggests that the
increased investment spurred by IRC § 179 does not offset lost tax
revenue; and 3) it's extremely unclear how much raising the expense cap
actually increases investment in small businesses as opposed to just
including larger businesses. Remaining coupled to IRC § 179 will cost
the state $68 million in tax year 2026.

Evidence suggests that even at the national level, these tax breaks lose
far more revenue than any economic activity they might bring in, and
each provision favors certain industries over others. But business
expensing makes even less sense at a state level, since, as ITEP
explains, state taxes on corporations who do business in multiple states
are calculated by: "1. Taking the company's nationwide gross receipts,
2. Subtracting nationwide deductions, and (3). Taxing the state's share
of that nationwide profit" Accordingly, New York taxpayers may be taking
deductions on investments that did not even occur in-state, causing
massive revenue losses with no investment gain.(1)

Taken together, these three business expensing expansions in OBBBA will
cost the state up to a staggering $2.86 billion in 2026.2 Decoupling
from this regressive federal tax bill, which as a whole will send one-
third of its net tax reductions to those making over $500,000 by 2027,
will save the state billions of dollars in lost revenue while avoiding
the pitfalls of wasteful and ineffective corporate handouts.(4)

 
PRIOR LEGISLATIVE HISTORY:

None

 
FISCAL IMPLICATIONS:

This bill will save the state $2.86 billion in 2026.

 
EFFECTIVE DATE:
This Act Shall Take Effect Immediately
1 Mazerov, Michael, and Nick Johnson. "Why States Shouldn't Go along
with OBBBA's Corporate Tax Breaks: A Practical Guide." ITEP, Institute
on Taxation and Economic Policy (ITEP), 27 Oct. 2025, itep.org/states-
obbba-corporate-tax-breaks-a-practical-guide/.  Accessed 5 Dec. 2025.
2 Higgs, Milly. "The One Big Beautiful Bill Act Gets Expensing Right.
States Should Follow Suit." Tax Foundation, 22 July 2025,
taxfoundation.org/blogione-big-beautiful-bill-expensing-state-tax-
conformity/. Accessed
3 Lautz, Andrew. The 2025 Tax Debate: Section 179 Expensing for Small
Businesses I Bipartisan Policy Center." Bipartisanpolicy.org, Bipartisan
Policy Center, 19 July 2025,
bipartisanpolicy.org/explainer/the-2025-tax-debate-section-179-expensing
-for-small-busi nesses/.
4 New York State Comptroller Thomas DiNapoli. Tax Provisions under the
Federal Reconciliation Bill. Sept. 2025.
5 Dec. 2025.

2025-S8631A (ACTIVE) - Bill Text download pdf

                             
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                  8631--A
 
                        2025-2026 Regular Sessions
 
                             I N  S E N A T E
 
                             December 22, 2025
                                ___________
 
 Introduced by Sen. GOUNARDES -- read twice and ordered printed, and when
   printed  to  be  committed to the Committee on Rules -- recommitted to
   the Committee on Budget and Revenue in accordance with Senate Rule  6,
   sec.  8  --  committee  discharged, bill amended, ordered reprinted as
   amended and recommitted to said committee

 AN ACT to amend the tax law, in relation to  the  treatment  of  certain
   deductions  allowable  under  the internal revenue code in calculating
   federal adjusted gross income
 
   THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section  1.   Paragraph (a) of subdivision 9 of section 208 of the tax
 law is amended by adding four new subparagraphs 24, 25, 26,  and  27  to
 read as follows:
   (24)  FOR TAXABLE YEARS BEGINNING ON OR AFTER JANUARY FIRST, TWO THOU-
 SAND TWENTY-FIVE, IN THE CASE OF QUALIFIED PRODUCTION PROPERTY DESCRIBED
 IN PARAGRAPH TWO OF SUBSECTION (N) OF SECTION ONE HUNDRED SIXTY-EIGHT OF
 THE INTERNAL REVENUE CODE, THE AMOUNT OF ANY DEDUCTION ALLOWED  PURSUANT
 TO  SUBSECTION  (A)  OF  SECTION ONE HUNDRED SIXTY-SEVEN OF THE INTERNAL
 REVENUE CODE AS IF THE TAXPAYER HAS NOT MADE  AN  ELECTION  PURSUANT  TO
 SUBSECTION (N) OF SECTION ONE HUNDRED SIXTY-EIGHT OF THE INTERNAL REVEN-
 UE CODE.
   (25)  FOR TAXABLE YEARS BEGINNING ON OR AFTER JANUARY FIRST, TWO THOU-
 SAND TWENTY-FIVE, THE AMOUNT OF ANY FOREIGN  AND  DOMESTIC  RESEARCH  OR
 EXPERIMENTAL  EXPENDITURES,  AS DEFINED IN SECTIONS ONE HUNDRED SEVENTY-
 FOUR AND 174A OF THE INTERNAL REVENUE CODE, PAID  OR  INCURRED  IN  EACH
 TAXABLE YEAR ON AND AFTER JANUARY FIRST, TWO THOUSAND TWENTY-FIVE, AMOR-
 TIZED  OVER A SIXTY-MONTH PERIOD AS IF THE ELECTION IN SUBSECTION (C) OF
 SECTION 174A OF THE INTERNAL REVENUE CODE APPLIED TO  SUCH  FOREIGN  AND
 DOMESTIC RESEARCH OR EXPERIMENTAL EXPENDITURES.
   (26)  FOR TAXABLE YEARS BEGINNING ON OR AFTER JANUARY FIRST, TWO THOU-
 SAND TWENTY-FIVE, THE REMAINING  AMOUNT  OF  ANY  FOREIGN  AND  DOMESTIC
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
                                                            LBD14215-03-6

 S. 8631--A                          2
 
 RESEARCH  OR  EXPERIMENTAL  EXPENDITURES,  AS  DEFINED  IN  SECTIONS ONE
 HUNDRED SEVENTY-FOUR AND 174A OF THE  INTERNAL  REVENUE  CODE,  PAID  OR
 INCURRED PRIOR TO JANUARY FIRST, TWO THOUSAND TWENTY-FIVE, DETERMINED AS
 IF  SECTION  ONE  HUNDRED  SEVENTY-FOUR  OF THE INTERNAL REVENUE CODE IN
 EFFECT AS OF JANUARY FIRST, TWO THOUSAND  TWENTY-TWO,  APPLIED  TO  SUCH
 EXPENDITURES.
   (27)  FOR TAXABLE YEARS BEGINNING ON OR AFTER JANUARY FIRST, TWO THOU-
 SAND TWENTY-FIVE, IN THE CASE OF SECTION 179 PROPERTY  AS  DESCRIBED  IN
 SUBSECTION  (D)  OF  SECTION  ONE  HUNDRED  SEVENTY-NINE OF THE INTERNAL
 REVENUE CODE WITH RESPECT TO SUCH PROPERTY THE AMOUNT OF  ANY  DEDUCTION
 MADE  PURSUANT  TO  SECTION 179 OF THE INTERNAL REVENUE CODE AS IT SHALL
 HAVE BEEN IN EFFECT AS OF JANUARY FIRST, TWO THOUSAND TWENTY-TWO.
   § 2. Paragraph (b) of subdivision 9 of section 208 of the tax  law  is
 amended  by  adding  three  new  subparagraphs 28, 29, and 30 to read as
 follows:
   (28) FOR TAXABLE YEARS BEGINNING ON OR AFTER JANUARY FIRST, TWO  THOU-
 SAND TWENTY-FIVE, IN THE CASE OF QUALIFIED PRODUCTION PROPERTY DESCRIBED
 IN PARAGRAPH TWO OF SUBSECTION (N) OF SECTION ONE HUNDRED SIXTY-EIGHT OF
 THE  INTERNAL  REVENUE  CODE, ANY AMOUNT WHICH THE TAXPAYER CLAIMED AS A
 DEDUCTION UNDER SUBSECTION (A) OF SECTION ONE HUNDRED SIXTY-SEVEN OF THE
 INTERNAL REVENUE CODE THAT INCLUDED AN ALLOWANCE SOLELY AS A  RESULT  OF
 AN  ELECTION  MADE  PURSUANT  TO  SUBSECTION  (N) OF SECTION ONE HUNDRED
 SIXTY-EIGHT OF THE INTERNAL REVENUE CODE.
   (29) FOR TAXABLE YEARS BEGINNING ON OR AFTER JANUARY FIRST, TWO  THOU-
 SAND  TWENTY-FIVE,  ANY AMOUNT CLAIMED AS A DEDUCTION UNDER SECTIONS ONE
 HUNDRED SEVENTY-FOUR AND 174A OF THE INTERNAL REVENUE CODE IN EFFECT  AS
 OF  JANUARY FIRST, TWO THOUSAND TWENTY-FIVE, AND ANY AMOUNT CLAIMED AS A
 DEDUCTION PURSUANT TO FEDERAL PUBLIC  LAW  119-21,  TITLE  VII,  SECTION
 70302(F)(2)(A),  FOR  FOREIGN  AND  DOMESTIC  RESEARCH  OR  EXPERIMENTAL
 EXPENDITURES, AS DEFINED IN SECTIONS ONE HUNDRED SEVENTY-FOUR  AND  174A
 OF THE INTERNAL REVENUE CODE.
   (30)  FOR TAXABLE YEARS BEGINNING ON OR AFTER JANUARY FIRST, TWO THOU-
 SAND TWENTY-FIVE, IN THE CASE  OF  SECTION  179  PROPERTY  DESCRIBED  IN
 SUBSECTION  (D)  OF  SECTION  ONE  HUNDRED  SEVENTY-NINE OF THE INTERNAL
 REVENUE CODE WITH RESPECT TO SUCH PROPERTY THE AMOUNT OF  THE  DEDUCTION
 ALLOWABLE UNDER SECTION ONE HUNDRED SEVENTY-NINE OF THE INTERNAL REVENUE
 CODE.
   § 3. Subsection (b) of section 612 of the tax law is amended by adding
 three new paragraphs 44, 45 and 46 to read as follows:
   (44)  FOR TAXABLE YEARS BEGINNING ON OR AFTER JANUARY FIRST, TWO THOU-
 SAND TWENTY-FIVE, IN THE CASE OF QUALIFIED PRODUCTION PROPERTY DESCRIBED
 IN PARAGRAPH TWO OF SUBSECTION (N) OF SECTION ONE HUNDRED SIXTY-EIGHT OF
 THE INTERNAL REVENUE CODE, ANY AMOUNT WHICH THE TAXPAYER  CLAIMED  AS  A
 DEDUCTION UNDER SUBSECTION (A) OF SECTION ONE HUNDRED SIXTY-SEVEN OF THE
 INTERNAL  REVENUE  CODE THAT INCLUDED AN ALLOWANCE SOLELY AS A RESULT OF
 AN ELECTION MADE PURSUANT TO  SUBSECTION  (N)  OF  SECTION  ONE  HUNDRED
 SIXTY-EIGHT OF THE INTERNAL REVENUE CODE.
   (45)  FOR TAXABLE YEARS BEGINNING ON OR AFTER JANUARY FIRST, TWO THOU-
 SAND TWENTY-FIVE, ANY AMOUNT CLAIMED AS A DEDUCTION UNDER  SECTIONS  ONE
 HUNDRED  SEVENTY-FOUR AND 174A OF THE INTERNAL REVENUE CODE IN EFFECT AS
 OF JANUARY FIRST, TWO THOUSAND TWENTY-FIVE, AND ANY AMOUNT CLAIMED AS  A
 DEDUCTION  PURSUANT  TO  FEDERAL  PUBLIC  LAW 119-21, TITLE VII, SECTION
 70302(F)(2)(A),  FOR  FOREIGN  AND  DOMESTIC  RESEARCH  OR  EXPERIMENTAL
 EXPENDITURES,  AS  DEFINED IN SECTIONS ONE HUNDRED SEVENTY-FOUR AND 174A
 OF THE INTERNAL REVENUE CODE.
 S. 8631--A                          3
 
   (46) FOR TAXABLE YEARS  BEGINNING  AFTER  DECEMBER  THIRTY-FIRST,  TWO
 THOUSAND  TWENTY-FIVE,  IN THE CASE OF SECTION 179 PROPERTY DESCRIBED IN
 SUBSECTION (D) OF SECTION  ONE  HUNDRED  SEVENTY-NINE  OF  THE  INTERNAL
 REVENUE  CODE, WITH RESPECT TO SUCH PROPERTY THE AMOUNT OF THE DEDUCTION
 ALLOWABLE UNDER SECTION ONE HUNDRED SEVENTY-NINE OF THE INTERNAL REVENUE
 CODE.
   § 4. Subsection (c) of section 612 of the tax law is amended by adding
 four new paragraphs 48, 49, 50, and 51 to read as follows:
   (48)  FOR TAXABLE YEARS BEGINNING ON OR AFTER JANUARY FIRST, TWO THOU-
 SAND TWENTY-FIVE, IN THE CASE OF QUALIFIED PRODUCTION PROPERTY DESCRIBED
 IN PARAGRAPH TWO OF SUBSECTION (N) OF SECTION ONE HUNDRED SIXTY-EIGHT OF
 THE INTERNAL REVENUE CODE, THE AMOUNT OF ANY DEDUCTION ALLOWED  PURSUANT
 TO  SUBSECTION  (A)  OF  SECTION ONE HUNDRED SIXTY-SEVEN OF THE INTERNAL
 REVENUE CODE AS IF THE TAXPAYER HAS NOT MADE  AN  ELECTION  PURSUANT  TO
 SUBSECTION (N) OF SECTION ONE HUNDRED SIXTY-EIGHT OF THE INTERNAL REVEN-
 UE CODE.
   (49)  FOR TAXABLE YEARS BEGINNING ON OR AFTER JANUARY FIRST, TWO THOU-
 SAND TWENTY-FIVE, THE AMOUNT OF ANY FOREIGN  AND  DOMESTIC  RESEARCH  OR
 EXPERIMENTAL  EXPENDITURES,  AS DEFINED IN SECTIONS ONE HUNDRED SEVENTY-
 FOUR AND 174A OF THE INTERNAL REVENUE CODE, PAID  OR  INCURRED  IN  EACH
 TAXABLE YEAR ON AND AFTER JANUARY FIRST, TWO THOUSAND TWENTY-FIVE, AMOR-
 TIZED  OVER A SIXTY-MONTH PERIOD AS IF THE ELECTION IN SUBSECTION (C) OF
 SECTION 174A OF THE INTERNAL REVENUE CODE APPLIED TO  SUCH  FOREIGN  AND
 DOMESTIC RESEARCH OR EXPERIMENTAL EXPENDITURES.
   (50)  FOR TAXABLE YEARS BEGINNING ON OR AFTER JANUARY FIRST, TWO THOU-
 SAND TWENTY-FIVE, THE REMAINING  AMOUNT  OF  ANY  FOREIGN  AND  DOMESTIC
 RESEARCH  OR  EXPERIMENTAL  EXPENDITURES,  AS  DEFINED  IN  SECTIONS ONE
 HUNDRED SEVENTY-FOUR AND 174A OF THE  INTERNAL  REVENUE  CODE,  PAID  OR
 INCURRED PRIOR TO JANUARY FIRST, TWO THOUSAND TWENTY-FIVE, DETERMINED AS
 IF  SECTION  ONE  HUNDRED  SEVENTY-FOUR  OF THE INTERNAL REVENUE CODE IN
 EFFECT AS OF JANUARY FIRST, TWO THOUSAND  TWENTY-TWO,  APPLIED  TO  SUCH
 EXPENDITURES.
   (51)  FOR TAXABLE YEARS BEGINNING ON OR AFTER JANUARY FIRST, TWO THOU-
 SAND TWENTY-FIVE, IN THE CASE OF SECTION 179 PROPERTY  AS  DESCRIBED  IN
 SUBSECTION  (D)  OF  SECTION  ONE  HUNDRED  SEVENTY-NINE OF THE INTERNAL
 REVENUE CODE WITH RESPECT TO SUCH PROPERTY THE AMOUNT OF  ANY  DEDUCTION
 MADE  PURSUANT  TO  SECTION 179 OF THE INTERNAL REVENUE CODE AS IT SHALL
 HAVE BEEN IN EFFECT AS OF JANUARY FIRST, TWO THOUSAND TWENTY-TWO.
   § 5. Paragraph 1 of subdivision (b) of section 1503 of the tax law  is
 amended by adding four new subparagraphs (X), (Y), (Z), and (AA) to read
 as follows:
   (X)  FOR  TAXABLE YEARS BEGINNING ON OR AFTER JANUARY FIRST, TWO THOU-
 SAND TWENTY-FIVE, IN THE CASE OF QUALIFIED PRODUCTION PROPERTY DESCRIBED
 IN PARAGRAPH TWO OF SUBSECTION (N) OF SECTION ONE HUNDRED SIXTY-EIGHT OF
 THE INTERNAL REVENUE CODE, THE AMOUNT OF ANY DEDUCTION ALLOWED  PURSUANT
 TO  SUBSECTION  (A)  OF  SECTION ONE HUNDRED SIXTY-SEVEN OF THE INTERNAL
 REVENUE CODE AS IF THE TAXPAYER HAS NOT MADE  AN  ELECTION  PURSUANT  TO
 SUBSECTION (N) OF SECTION ONE HUNDRED SIXTY-EIGHT OF THE INTERNAL REVEN-
 UE CODE.
   (Y)  FOR  TAXABLE YEARS BEGINNING ON OR AFTER JANUARY FIRST, TWO THOU-
 SAND TWENTY-FIVE, THE AMOUNT OF ANY FOREIGN  AND  DOMESTIC  RESEARCH  OR
 EXPERIMENTAL  EXPENDITURES,  AS DEFINED IN SECTIONS ONE HUNDRED SEVENTY-
 FOUR AND 174A OF THE INTERNAL REVENUE CODE, PAID  OR  INCURRED  IN  EACH
 TAXABLE YEAR ON AND AFTER JANUARY FIRST, TWO THOUSAND TWENTY-FIVE, AMOR-
 TIZED  OVER A SIXTY-MONTH PERIOD AS IF THE ELECTION IN SUBSECTION (C) OF
 S. 8631--A                          4
 
 SECTION 174A OF THE INTERNAL REVENUE CODE APPLIED TO  SUCH  FOREIGN  AND
 DOMESTIC RESEARCH OR EXPERIMENTAL EXPENDITURES.
   (Z)  FOR  TAXABLE YEARS BEGINNING ON OR AFTER JANUARY FIRST, TWO THOU-
 SAND TWENTY-FIVE, THE REMAINING  AMOUNT  OF  ANY  FOREIGN  AND  DOMESTIC
 RESEARCH  OR  EXPERIMENTAL  EXPENDITURES,  AS  DEFINED  IN  SECTIONS ONE
 HUNDRED SEVENTY-FOUR AND 174A OF THE  INTERNAL  REVENUE  CODE,  PAID  OR
 INCURRED PRIOR TO JANUARY FIRST, TWO THOUSAND TWENTY-FIVE, DETERMINED AS
 IF  SECTION  ONE  HUNDRED  SEVENTY-FOUR  OF THE INTERNAL REVENUE CODE IN
 EFFECT AS OF JANUARY FIRST, TWO THOUSAND  TWENTY-TWO,  APPLIED  TO  SUCH
 EXPENDITURES.
   (AA)  FOR TAXABLE YEARS BEGINNING ON OR AFTER JANUARY FIRST, TWO THOU-
 SAND TWENTY-FIVE, IN THE CASE OF SECTION 179 PROPERTY  AS  DESCRIBED  IN
 SUBSECTION  (D)  OF  SECTION  ONE  HUNDRED  SEVENTY-NINE OF THE INTERNAL
 REVENUE CODE WITH RESPECT TO SUCH PROPERTY THE AMOUNT OF  ANY  DEDUCTION
 MADE  PURSUANT  TO  SECTION 179 OF THE INTERNAL REVENUE CODE AS IT SHALL
 HAVE BEEN IN EFFECT AS OF JANUARY FIRST, TWO THOUSAND TWENTY-TWO.
   § 6. Paragraph 2 of subdivision (b) of section 1503 of the tax law  is
 amended  by  adding three new subparagraphs (AA), (BB), and (CC) to read
 as follows:
   (AA) FOR TAXABLE YEARS BEGINNING ON OR AFTER JANUARY FIRST, TWO  THOU-
 SAND TWENTY-FIVE, IN THE CASE OF QUALIFIED PRODUCTION PROPERTY DESCRIBED
 IN PARAGRAPH TWO OF SUBSECTION (N) OF SECTION ONE HUNDRED SIXTY-EIGHT OF
 THE  INTERNAL  REVENUE  CODE, ANY AMOUNT WHICH THE TAXPAYER CLAIMED AS A
 DEDUCTION UNDER SUBSECTION (A) OF SECTION ONE HUNDRED SIXTY-SEVEN OF THE
 INTERNAL REVENUE CODE THAT INCLUDED AN ALLOWANCE SOLELY AS A  RESULT  OF
 AN  ELECTION  MADE  PURSUANT  TO  SUBSECTION  (N) OF SECTION ONE HUNDRED
 SIXTY-EIGHT OF THE INTERNAL REVENUE CODE.
   (BB) FOR TAXABLE YEARS BEGINNING ON OR AFTER JANUARY FIRST, TWO  THOU-
 SAND  TWENTY-FIVE,  ANY AMOUNT CLAIMED AS A DEDUCTION UNDER SECTIONS ONE
 HUNDRED SEVENTY-FOUR AND 174A OF THE INTERNAL REVENUE CODE IN EFFECT  AS
 OF  JANUARY FIRST, TWO THOUSAND TWENTY-FIVE, AND ANY AMOUNT CLAIMED AS A
 DEDUCTION PURSUANT TO FEDERAL PUBLIC  LAW  119-21,  TITLE  VII,  SECTION
 70302(F)(2)(A),  FOR  FOREIGN  AND  DOMESTIC  RESEARCH  OR  EXPERIMENTAL
 EXPENDITURES, AS DEFINED IN SECTIONS ONE HUNDRED SEVENTY-FOUR  AND  174A
 OF THE INTERNAL REVENUE CODE.
   (CC)  FOR TAXABLE YEARS BEGINNING ON OR AFTER JANUARY FIRST, TWO THOU-
 SAND TWENTY-FIVE, IN THE CASE  OF  SECTION  179  PROPERTY  DESCRIBED  IN
 SUBSECTION  (D)  OF  SECTION  ONE  HUNDRED  SEVENTY-NINE OF THE INTERNAL
 REVENUE CODE WITH RESPECT TO SUCH PROPERTY THE AMOUNT OF  THE  DEDUCTION
 ALLOWABLE UNDER SECTION ONE HUNDRED SEVENTY-NINE OF THE INTERNAL REVENUE
 CODE.
   § 7. This act shall take effect immediately and shall apply to taxable
 years beginning on or after January 1, 2025.

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Senate Bill S8631

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Sponsored By

Andrew Gounardes

Current Bill Status - In Senate Committee Budget And Revenue Committee

Actions

Bill Amendments

2025-S8631 - Details

2025-S8631 - Summary

2025-S8631 - Sponsor Memo

2025-S8631 - Bill Text download pdf

2025-S8631A (ACTIVE) - Details

2025-S8631A (ACTIVE) - Summary

2025-S8631A (ACTIVE) - Sponsor Memo

2025-S8631A (ACTIVE) - Bill Text download pdf

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