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Bill

A 11253

Relates to the personal income tax rates; repealer

2025 Regular Session Introduced by Michael Durso and 1 co-sponsor

New York adopts a multi-year, tiered personal income tax schedule (2026–2035) across all filing statuses, replacing current rates with gradually escalating brackets and a top 10.90

REFERRED TO WAYS AND MEANS
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WeVote Research Nonpartisan
Bill Summary · A 11253

Overview

  • Bill: A 11253 (2025-2026 Session, New York)
  • Introduced: May 4, 2026
  • Prime sponsor: Assembly member Smullen (co-sponsors: Durso, Smullen)
  • Purpose: Amend the New York Tax Law to modify personal income tax rates and repealing certain existing provisions related to those rates. The act introduces a multi-year schedule of tiered tax rates for all filing statuses (joint, head of household, single/unmarried, and estates/trusts), with rates and brackets that evolve from 2026 through 2035. It also repeals and replaces specific subsections of section 601 of the tax law.

Main Purpose and Intent

  • Establish a new, gradually evolving personal income tax structure for residents and certain related filers.
  • Repeal certain existing rate provisions and replace them with a structured, stepwise schedule that changes by taxable year (beginning 2026–2035).
  • Create unified tax tables for:
    • Resident married individuals filing joint returns and surviving spouses
    • Resident heads of households
    • Resident unmarried individuals, estates, and trusts
    • Married individuals filing separately
  • Trigger an effectively staged transition of tax burdens over a 10-year period (2026–2035), with rate bands and brackets expanding over time.

Key Provisions and Changes

  • Section 601(a) (repealed and replaced):

    • Introduces a tiered tax table for joint filers and surviving spouses beginning in 2026, with progressive rates starting at 4% on income over $10,000 and escalating to 10.90% on very high incomes (over $25,000,000), including several brackets and fixed base amounts for higher tiers.
    • 2026 bracket example: 0% on up to $10,000; 4% on excess over $10,000; 5% on excess over $500,000 up to certain thresholds; higher brackets include 9.65%, 10.30%, and 10.90% as income rises beyond specified levels.
    • Beginning in 2027–2035, progressively adjusted brackets and base amounts continue with similar structure but different thresholds and base amounts (e.g., 4% on excess over $20,000 in 2027, etc., with higher brackets for top incomes).
    • The schedule includes explicit formulas for brackets up to and beyond $25,000,000 of New York taxable income, with corresponding fixed components to be added to the tax (the “plus” components shown in the tables).

  • Section 601(b) (repealed and replaced):

    • Adds a parallel tiered tax table for resident heads of households, with similar multi-year progression (2026–2035) and escalating rates (4%, 5%, 9.65%, 10.30%, 10.90% on very high incomes).
    • Each year’s bracket structure mirrors the joint filers’ approach but with different base thresholds (e.g., starting points at $7,500 in 2026, $15,000 in 2027, etc.).

  • Section 601(c) (repealed and replaced):

    • Adds a parallel tiered tax table for resident unmarried individuals, estates, and trusts, following the same year-by-year progression and top-end rate structure as above.
    • Provides year-specific brackets (starting at $5,000 in 2026 for the 0% bracket, then 4% on excess over $5,000, etc.).

  • Section 601(d) (repealed and replaced):

    • Adds a parallel tiered tax table for resident married individuals filing separately, with a similar multi-year progression and top-end rate structure.

  • Section 601(d-4) (opening paragraph repealed) and related subsections (d-5, d-6, d-7) repealed:

    • Repeal of certain existing subparts related to alternative or prior definitions of filing status and taxation within section 601, consolidating into the new structure.

  • Effective date:

    • The act is stated to take effect immediately.

Who Would Be Affected

  • Residents of New York State who file:
    • Joint returns (married couples) or as surviving spouses
    • Heads of households
    • Unmarried individuals, estates, and trusts
    • Married individuals filing separately
  • High-income taxpayers (notably those with New York taxable income well above $25,000,000) due to the explicit top-end brackets and higher tax components.
  • Tax planning and withholding systems would need to align with the year-by-year bracket changes from 2026 through 2035.

Procedural and Timeline Considerations

  • Year-by-year rate schedule:
    • 2026: New brackets introduced for joint/surviving spouse, heads of households, and others
    • 2027–2035: Brackets adjust with each taxable year, maintaining a similar structure but with updated thresholds and base amounts
  • Repeals:
    • Subsections of section 601 related to existing tax rate structures are repealed and replaced with the new tables
  • Immediate effect:
    • The act provision indicates immediate effectiveness, meaning the new framework would begin applying in the 2026 tax year
  • Administrative aspects:
    • Tax computations would rely on the new tables for each filing status
    • Withholding and estimated tax schedules would need updating to reflect the new rates and thresholds

Potential Impacts and Considerations

  • Tax Burden Shifts:
    • The top marginal rate (10.90%) applies to very high income levels, with significant progressive growth across brackets.
    • Some middle- to upper-middle-income taxpayers may experience changes in effective tax rate due to the shifting brackets and base amounts over time.
  • Simplicity vs. Complexity:
    • The multi-year phase-in creates a predictable, but complex, series of brackets for planning. Tax software and professional tax preparation would need to implement the yearly bracket updates.
  • Equity and Revenue:
    • The structure notably emphasizes higher rates on top earners, potentially increasing state revenue while preserving broader brackets for lower-income residents.

If you’d like, I can provide a side-by-side comparison of the 2026 brackets by filing status, or an example calculation illustrating how a hypothetical taxpayer’s tax would be determined under the 2026 and 2035 schedules.

Compiled from official sources — confirm details with the bill’s official record.

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