On April 9, New York Governor Kathy Hochul signed tax legislation as part of the state’s Fiscal Year 2023 budget. Of significant note for NY City (NYC) resident individuals, this new legislation creates tax law which provides for an elective NYC Pass-Through Entity Tax (NYC PTET) that is very similar to the New York State Pass-Through Entity Tax (NYS PTET). The NYC PTET will be effective for tax years beginning on or after January 1, 2023.


On September 15, 2021, the House Ways and Means Committee approved legislation to be included in President Biden’s $3.5 trillion infrastructure bill.


Tax provisions of President Biden's proposed fiscal year 2022 budget

The Treasury Department has recently released its explanations of the tax proposals (known as the “Green Book”), as part of President Biden’s proposed budget for the upcoming fiscal year.


On April 28, President Biden addressed a joint session of Congress and announced the American Families Plan (“the Plan”), portrayed as an investment in the nation’s children, families and economic future.


On April 19, 2021, the Governor signed into law the New York State (“NYS”) Budget which has many new tax provisions. Several of the more pertinent provisions follow:


Section 163(j), Limitation On Business Interest, was amended by the 2017 TCJA and by the CARES Act. For tax years beginning after December 31, 2017, business interest expense deductions are generally limited to the sum of:


The Taxpayer Certainty and Disaster Tax Relief Act of 2020 (“TCDTR”), enacted in December 2020, made several taxpayer friendly revisions to the Employee Retention Credit (“ERC”) enacted as part of the Coronavirus Aid, Relief and Economic Security Act (“CARES Act”).


Further to our January 7th email alert, New York State has announced that it has changed its position and WILL follow the Federal treatment relating to PPP Loan forgiveness. Accordingly, PPP loans that are forgiven will not be taxable by New York State.


Over the past year, numerous laws have been enacted, each containing many tax changes intended to mitigate the economic hardship wrought by Covid-19.


Late Monday night, December 21, 2020, Congress passed the Covid-related Tax Relief Act of 2020 ("COVIDTRA") and the Taxpayer Certainty and Disaster Tax Relief Act of 2020 ("TCDTR") both part of the Consolidated Appropriations Act, 2021("CAA"). Although the CAA was passed with a veto proof margin, President Trump has threatened not to sign it and is requesting that Congress revise the COVIDTRA to provide a larger amount of direct payment to individual taxpayers than the $600 that is currently contained in the COVIDTRA.


A potentially large deduction is about to expire on December 31, 2020. That deduction is the energy efficient building deduction under Internal Revenue Code Section 179D which was extended by Congress in December 2019 by the Taxpayer Certainty and Disaster Relief Act of 2019. The section 179D tax deduction was originally passed by Congress as part of the Energy Policy Act of 2005 in an effort to encourage broader energy efficiency. Section 179D allows qualifying building owners and businesses to receive an up to $1.80 per square foot tax deduction for their energy-efficient qualifying property placed in service after 2005 and before 2021.


The Paycheck Protection Program (”PPP”) Flexibility Act of 2020, passed last week by the House and Senate was signed by the President this past Friday. As we noted last week in our Client Alert, the bill brings favorable changes and greater flexibility (in comparison to the PPP Program as enacted in the CARES Act in March) in calculating how a loan under the PPP is forgiven.


Since the inception of the funding of the PPP loans by the SBA, much discussion has focused on the SBA’s good faith certification where they required the borrower to certify in good faith that “current economic uncertainty makes this loan request necessary to support the ongoing operations of the Applicant”.


The Act authorizes SBA loans to qualifying small businesses. Generally, a qualifying small business is defined as a business having no more than 500 employees. Qualifying businesses can be sole proprietorships and businesses with multiple locations, so long as the business has no more than 500 employees.


On April 13, 2016, Governor Andrew Cuomo signed New York State's 2016-2017 budget which includes a variety of corporate franchise and personal income changes.


The IRS has increased from $500 to $2,500 the maximum threshold for expensing certain capital items


Contribute up to $2,550; $500 Carryover Option Available to Many


The IRS has made major changes in the way they will audit partnership returns.


In June, New York City extended the 421-a exemption program for housing development projects with over 15 units until January 15, 2016.


Just before midnight on Thursday, June 25th, the New York State Legislature passed a bill that extended the rent  laws for four years through 2019. Here is a brief summary of the important changes to the rent laws that you must know.


When there is a transfer of interest where a partner buys out another partner’s interest or a part of the partner’s interest, the new partner can receive additional depreciation expense under Internal Revenue Code section 754.


IRS has issued final regulations that make significant changes to the rules regarding when you must capitalize an expenditure  as opposed to deducting it as a repair.


The IRS and Treasury have issued long-awaited, comprehensive regulations on the capitalization of amounts paid to acquire, produce or improve tangible property.


New Reporting Rules for Foreign Financial Assets


The Internal Revenue Service has made it easier for real estate professionals to make late elections to treat all interests in rental real estate as a single rental activity.