New YorkS 90092025-2026 Regular SessionSenateWALLET

Enacts into law major components of legislation which are necessary to implement the state fiscal plan for the 2026-2027 state fiscal year

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Bill Overview

Analyzed Economic Effects

74 provisions identified: 43 benefits, 19 costs, 12 mixed.

Full local tax relief for disabled veterans

Counties, cities, towns, villages, and school districts can fully exempt a qualifying disabled veteran's primary home from specified property taxes and charges. Covered charges include special district charges, assessments, and special ad valorem levies. The VA must document permanent and total disability caused by military service. The veteran must also meet the law's service, discharge, or qualifying veteran-status requirements and its remaining eligibility requirements. Relief applies only where the taxing government adopts it.

Investor tax break for qualifying distributions

Beginning with tax years starting January 1, 2026, investors can subtract qualifying section 962(d) distributions from New York adjusted gross income. The subtraction covers the amount included in federal adjusted gross income under that section. Actual tax savings depend on the investor's tax situation.

Lower state taxes for tipped workers

Beginning with tax years starting January 1, 2026, workers can subtract eligible tips from New York taxable income. The subtraction cannot exceed $25,000 or the federal tip deduction allowed to that taxpayer, whichever is lower. This is an income deduction, not a $25,000 payment.

New care tax credit for families

Beginning with tax years starting January 1, 2026, eligible New York residents get a refundable child and dependent care credit. Qualifying people generally must be under 13 or unable to care for themselves and live with you over half the year. Eligible expense caps are $3,000 for one person, $6,000 for two, $7,500 for three, $8,500 for four, and $9,000 for five or more. The rate is 55% at New York adjusted gross income of $15,000 or less. It falls by 0.0025 percentage points per additional dollar, to a 4% floor. Above $750,000, the credit drops by $20 per $1,000 of income. Expenses are also limited by earned income; joint filers use the lower spouse's earned income. Taxpayers cannot be someone else's dependent, and married separate filers must meet special federal eligibility rules. Required care-provider, expense, and qualifying-person information must be supplied; credit above tax owed is refunded without interest.

Retailers keep security credits through 2028

Businesses accepted into New York's commercial security tax credit program can claim $3,000 per eligible retail location. The credit covers tax years beginning January 1, 2024, through before January 1, 2029. Eligible businesses filing under the covered corporate or personal income tax laws can claim the program-determined amount. Expenses used for this credit cannot also support another state Tax Law credit.

Bigger food donation credit for farmers

Beginning with tax years starting January 1, 2026, eligible farmers get a larger credit for qualified food pantry donations. The rate rises from 25% to 50% of fair market value. The yearly cap rises from $5,000 to $20,000. For partnerships and New York S corporations, the cap applies to all owners' credits from the entity combined.

New surcharge on expensive second homes

Beginning July 1, 2026, New York City charges an annual surcharge on covered homes that are not primary residences. For fiscal years starting before July 1, 2028, class one properties use the law's phase-one values. Rates are 0.8% for $5 million–$15 million, 1.05% above $15 million–$25 million, and 1.3% above $25 million. Condominium and cooperative units use rates of 4% for $1 million–$3 million, 5.25% above $3 million–$5 million, and 6.5% above $5 million. Beginning July 1, 2028, covered properties with phase-two values of at least $5 million use the 0.8%, 1.05%, and 1.3% bands. The applicable rate applies to the applicable property value, and property-tax breaks do not reduce the surcharge. It is billed with property taxes and remains a tax lien; the first year's payment is due with the second semiannual installment. Cooperatives collect unit surcharges from tenant-stockholders and must promptly provide affected owners with notices.

Second-home surcharge collection and evasion penalties

Unpaid New York City home surcharges or interest can trigger collection lawsuits, warrant liens, and sales of debtors' property. These collection provisions run from July 1, 2026, through June 30, 2031. The state can release a warrant lien or vacate a warrant only without jeopardizing the city's interests. After notice and a hearing, the city can impose penalties up to 50% of the surcharge for materially misleading filings submitted negligently or in bad faith. The same maximum applies to bad-faith condominium divisions into more than three units to avoid the surcharge.

New care credit replaces families' old credit

For tax years beginning January 1, 2026 or later, the old state child and dependent care credit ends. A new refundable credit serves eligible New York residents, with special rules for married people filing separately. Expense caps are $3,000 for one qualifying person, $6,000 for two, $7,500 for three, $8,500 for four, and $9,000 for five or more. The credit rate is 55% at New York adjusted gross income of $15,000 or less. It falls by 0.0025 percentage points per additional dollar, to a 4% floor. The credit cannot exceed earned income and falls by $20 per $1,000 of income above $750,000. Amounts above tax owed are refunded without interest; the tax department may require identification for care providers and qualifying people.

Higher income limits for disability tax relief

From July 1, 2026 through June 30, 2028, the specified disability exemption definition uses a $75,000 household-income ceiling, subject to local law. The person must meet the disability-benefit or disability-based medical-assistance criteria, and all household members' income counts. Separately, beginning July 1, 2027, municipalities can raise the disability property-tax exemption income limit from $50,000 to as much as $75,000. The adopted local limit must stay between $3,000 and $75,000; a higher limit is not automatic.

Higher rent relief limits for qualifying households

Beginning July 1, 2026, localities can set the specified rent tax-abatement income ceiling as high as $75,000. The household head must be age 62 or older or meet the program's disability definition. The higher ceiling applies only where a local law, ordinance, or resolution adopts it.

Higher senior homeowner income limits

Beginning July 1, 2027, municipalities can raise the senior property-tax exemption income limit from $50,000 to at most $75,000. The local limit cannot be below $3,000. Higher-income homeowners gain access only where the municipality adopts a higher limit and they meet the exemption's eligibility requirements. Starting that date, local senior and disability exemption measures must be passed or changed separately from unrelated measures. Required public hearings still apply.

Homeowners get extra time for enhanced relief

Owners whose basic STAR exemption was not changed to enhanced STAR get another chance to request the enhanced benefit. The deadline is the last day school taxes can be paid without interest or penalty. After consulting the assessor, the tax commissioner may approve owners who qualify. If the assessment roll cannot be corrected in time, the commissioner may send the tax savings directly.

Homeowners get refundable school tax relief

Qualified homeowners can receive the full STAR credit even when they owe less income tax than the credit. Those without an income-tax filing requirement can also receive it. Excess credit is treated as an overpayment and credited or refunded without interest. When the state finds a property ineligible for a STAR exemption, owners must receive notice and a chance to seek review.

More rent relief access and notices

Beginning July 1, 2026, local law can raise the specified senior rent-exemption income limit from $50,000 to at most $75,000. The person or spouse must be at least 62 and meet possession, use, or occupancy requirements. Certain federally insured cooperative mortgages also require occupancy rights when the mortgage ended. The higher limit applies only where adopted locally. Tax relief for qualifying rent-regulated or rent-controlled properties occupied by seniors or people with disabilities lasts through June 30, 2028, instead of June 30, 2026. Landlords must give covered tenants rent-exemption eligibility and contact notices with initial leases, renewals, and annual housing registration. Housing officials give notices for specified major-capital-improvement applications and maximum-base-rent adjustments; covered housing companies give notices at rent increases and at least annually. These notices do not grant an exemption, and the tax-relief extensions do not promise a specific rent reduction.

Owners can challenge second-home surcharge decisions

For fiscal years starting July 1, 2026, covered owners can challenge excessive or unlawful surcharge values and non-primary-residence determinations. Applications go to the New York City Tax Commission while annual value records are open for public inspection. An initial residence-status challenge must accompany a value challenge; final residence-status decisions can also be challenged. Applications require verified information and, for another signer, a power of attorney and required documents. Owners can seek court review after a final commission decision within the city charter's deadline. Cooperative-unit decisions must be considered in same-year proceedings for other units in that property. These review provisions expire June 30, 2031.

City care credit includes new state benefit

New York City's dependent care credit calculation now includes the new state care credit alongside the old one. The qualifying dependent must be under age four at the end of the tax year. Eligible taxpayers can use the calculation even if they did not claim the federal credit.

Home battery tax break lasts longer

The law extends the sales-tax exemption for qualifying residential energy storage purchases. Its expiration moves from June 1, 2026, to June 1, 2028. Existing purchase eligibility rules still apply.

One-time energy credit for eligible residents

The refundable POWER credit provides a one-time payment for tax year 2026, based on 2024 New York return information. Joint filers and qualifying surviving spouses get $200 with 2024 New York adjusted gross income up to $150,000. They get $150 with income over $150,000 and up to $300,000. Single filers, separate married filers, and heads of household get $100 with income up to $150,000. Eligibility requires full-year New York residency in 2024, timely filing including extensions, and not being claimed as a dependent. The state advances the payment, and taxpayers can request a claimed shortfall. The credit is exempt from state and local income tax to the extent included in federal gross income.

Businesses can settle sales-tax interest cheaply

Eligible taxpayers with current sales-tax certificates can settle qualifying sales or use tax debts by paying tax plus half the interest. The debt must be fixed and final by September 1, 2026, with no remaining appeal rights. Full payment, including 50% of interest accrued through December 31, 2026, is due that day. Specified penalties, previously reduced or compromised debts, and specified tax-related convictions are excluded. Program payments cannot be refunded or used as credits.

Yearly funding for tobacco control programs

Beginning April 1, 2027, New York directs $50 million annually from section 471-b receipts to tobacco control and insurance initiatives. The health commissioner distributes the money through the designated state pool. This funding does not create a direct household payment.

More tax credits for theater productions

The aggregate cap for specified New York City musical and theatrical production tax credits rises from $400 million to $550 million. The change covers qualifying productions whose first performance was on or after December 1, 2025. The state allocates credits based on each production's first performance date.

Homeowners face later enhanced STAR relief

Enhanced STAR credit availability starts with tax years after 2025, one year later than previously stated. Taxpayers must satisfy the enhanced credit's existing eligibility requirements. The next STAR advance payment corrects any earlier overpayment or underpayment. Taxpayers can no longer choose to make that correction on their timely, originally filed income tax return.

Nicotine sellers owe an inventory tax

Alternative nicotine products held for sale in New York at 11:59 p.m. Eastern time on August 31, 2026, face an inventory tax. The responsible person must pay by September 21, 2026, using the tax commissioner's required filing method. This provision does not state the tax rate.

Businesses lose faster production property deductions

For tax years beginning January 1, 2025, or later, New York rejects deductions tied solely to the federal qualified-production-property election. State taxpayers calculate depreciation as though they had not made that election. New York City generally adds back the federal deduction across its four covered business taxes. Businesses making the specified federal election instead use regular depreciation, without the election's basis reduction or specified recapture treatment.

Businesses must spread research tax deductions

For tax years beginning January 1, 2025, or later, New York spreads new domestic and foreign research costs over 60 months. Corresponding federal deductions are added back for state corporate franchise, personal income, and insurance corporation taxes. Earlier costs use the remaining-amount rule from federal law in effect January 1, 2022. Across its four covered business taxes, New York City spreads domestic research costs over five years instead of following the federal deduction. The city's five-year period starts at the midpoint of the year the costs are paid or incurred.

City businesses face federal deduction addbacks

For tax years beginning January 1, 2025, or later, New York City adds back certain increases in federal interest deductions. These are increases tied to depreciation, amortization, or depletion in the federal adjusted-income calculation. The rule covers unincorporated businesses, general corporations, banking corporations, and business corporations. Business corporation tax calculations also add back specified production-property, equipment-expensing, and domestic research deductions for tax years beginning after December 31, 2024.

City checks homes for second-home surcharge

New York City annually checks primary-residence status for property and cooperative units meeting the surcharge's value thresholds. Owners receive notice and can submit proof within a city-set response period. Missing that period makes the decision final and generally blocks the specified challenge process; submitted proof can be audited within six years. For the fiscal year starting July 1, 2026, notice is due by August 30, 2026. Surcharge revenue is kept separate from regular property-tax levy, class-share, and rate calculations.

Homeowners face July ownership test for relief

The STAR credit now tests ownership and New York primary residence on July 1, rather than December 31. This changes which buyers and sellers qualify during a sale year. The law removes special rules for sellers and buyers when a prior owner received an advance payment. A taxpayer can qualify for only one primary home, and that home cannot receive a STAR exemption for the associated fiscal year.

Farmers face revised school tax credit tests

For tax years beginning January 1, 2026 or later, farmers face a revised school tax credit income test. They can use current-year farm income or its average over the current and two prior years. The threshold is two-thirds of federal gross income from all sources less $30,000. Farm income includes farmland-protection payments, commercial horse boarding, maple syrup, Christmas trees, and products from licensed New York farm cideries or wineries. Future farmland buyers must meet the same test and have paid school district taxes under their purchase contract.

Farm businesses face revised credit eligibility

Specified farm business credits use a revised definition of eligible farmer. The corporate income test allows current-year farm income or its average over the current and two prior years. The threshold is two-thirds of federal gross income from all sources less $30,000. Counted income includes farmland-protection payments, horse boarding, maple syrup, Christmas trees, and products from licensed New York farm cideries or wineries. Farm employers must also have an overtime expense certificate to qualify as eligible employers.

Companies face longer taxes before relief

The law extends the 7.25% corporate income-base rate for companies with a base above $5 million through tax years beginning before January 1, 2030. The general rate remains 6.5%, with special rules for small businesses, manufacturers, and qualified emerging technology companies. The 0.1875% business-capital rate also continues through tax years beginning before January 1, 2030, then becomes zero. Existing zero-rate rules remain for small businesses and qualified New York manufacturers. Capital-tax caps remain $5 million for other taxpayers and $350,000 for qualified New York manufacturers.

Winning racing bettors keep more pool money

Racing operators can no longer add the specified breakage amounts to their retained share of covered betting pools. Winning-ticket distributions are no longer reduced by those extra amounts; the stated retention percentages remain. The change includes covered on-track pools at franchised race meetings. For wagers combined with another state or country's pools under the specified pooling rule, that jurisdiction's retention and breakage rules still apply.

Winning racing bets use penny payouts

Winning pari-mutuel payouts must be calculated to the nearest penny, rather than withholding rounding leftovers called breakage. Another jurisdiction's rules can require an exception. Bets placed at a racetrack can use nearest-nickel rounding only when leftovers go to the designated horse aftercare fund. Thoroughbred and harness bets use their respective aftercare funds.

Saratoga seasonal workers skip racing licenses

Qualifying seasonal employees do not need racing licenses for specified Belmont-assigned race dates held at Saratoga in 2026. Workers must be hired solely for no more than six weeks during the summer meet. The Gaming Commission must approve the dates in writing.

Students can share unused meal funds

Qualifying school meal contracts can let enrolled students donate unused meal funds, meals, or points to enrolled students facing food insecurity. Programs must be run by the school or a qualifying tax-exempt nonprofit. Donations preserve the qualifying meal arrangement's sales-tax treatment. The underlying arrangement must serve enrolled students without cash payment when served. Donated value cannot benefit the school or nonprofit.

Cheap vending purchases stay tax free

Covered vending-machine food, drinks, and bottled water remain exempt from sales tax through May 31, 2029. The price limit is $1.50 in machines accepting only coins or cash. It is $2 in machines accepting another payment method.

Donors keep some disputed charity deductions

For tax years beginning January 1, 2026, or later, New York preserves itemized deductions for gifts to some charities. This includes charities approved for federal tax-exempt status before January 1, 2025, whose status the IRS later revokes. The charity must show the revocation was unrelated to its charitable mission and continue meeting the specified federal charity requirements. The gift must otherwise qualify for a charitable deduction.

Limited penalty relief for tax changes

Interest and penalties do not accrue on qualifying New York returns for tax years beginning in 2025. The return must be filed within a valid extension period or be an amended return. It must solely report tax modifications required by this law. The relief does not cover unrelated filing problems.

Capital betting corporation can use reserve money

From April 1, 2026 through March 31, 2027, Capital off-track betting can use $1 million from its capital acquisition fund. Uses include authorized wagering expenses and specified overdue racing, simulcast, fund, and state obligations. Local surcharge money must remain separate and continue going to localities. The Gaming Commission must approve a plan listing liabilities, projected revenue, and uses, with a year-end accounting. Audit findings of unauthorized use require repayment to the fund.

Home race broadcasts continue through June 2027

Qualifying in-home race simulcasting experiments and replacement agreements continue through June 30, 2027. The experiment must have begun before May 15, 1995. For the specified arrangement, each off-track betting corporation with technically capable homes or areas in its region must join the agreement. A party ending an agreement must give all other parties at least 45 days' written notice.

Race broadcast and wagering rules last longer

Out-of-state harness and specified thoroughbred simulcasting rules continue through June 30, 2027; a related racing section expires July 1, 2027 instead of July 1, 2026. The law continues full-card thoroughbred viewing and wagering when the franchised corporation is not holding a Saratoga meeting. Separate thoroughbred rules apply during Saratoga County meetings through June 30, 2027, then regardless of whether a meeting is underway. Another authorization covers days when the franchised corporation has no scheduled program but an in-state thoroughbred track is racing. Facilities need commission-approved horsemen's agreements where required; the no-Saratoga-meeting rule exempts franchised corporations licensed under section 1007.

Saratoga betting facilities keep outside race access

Through September 8, 2026, covered facilities can show and take bets on out-of-state thoroughbred races during Saratoga Race Course meetings. They must also accept bets on all in-state thoroughbred tracks conducting racing programs. Simulcasting facilities generally need a commission-approved horsemen's agreement. A franchised corporation licensed under section 1007 is exempt from that agreement requirement.

Westchester track keeps dedicated race prize funding

Through June 30, 2027, a Westchester receiving track continues setting aside money from races received from a franchised corporation. The allocation is 2.5% of total pools, adjusted by 50% of the specified difference in total commissions. The money must be used only for race purses at that receiving track.

Gaming facilities get job-linked extra payments

Specified Nassau and Suffolk video lottery facilities and qualifying tracks get a new 5% vendor payment after applying. Eligible tracks include those in region one and Orange County, within 15 miles of Native American class III gaming, or over 15 but under 50 miles from a destination resort gaming facility. Applicants report 2025 gaming employment and certify the previous year's employment each July 1 starting in 2027. Beginning July 1, 2027, the state can cut the payment by 1, 2, 3, or 4 percentage points when employment falls below 100%, 95%, 90%, or 85% of the 2025 level, respectively. Employment below 80% permits removal of the full 5% payment. The payment begins on the application date.

Regional gaming tracks get revised payments

The law revises extra vendor payments for qualifying tracks in specified Orange County and Ontario County gaming regions. The percentage starts with 90%, subtracts the track's vendor percentage and specified extra vendor percentage, then subtracts the gaming facility's effective tax rate. The extra percentage cannot exceed 10%. Payments apply only to wagering revenue while a gaming facility in the same region is open under an operation certificate.

Zone-one gaming payments require job retention

Qualifying development-zone-one tracks get an extra payment of 6.5% of wagering revenue after prizes. When the applicable New York City gaming facility's effective tax rate is below 44%, another payment uses that rate difference. Tracks must apply, report 2025 full-time-equivalent gaming employment, and retain at least 90% of that employment. Payments begin on application and cover revenue only while the applicable facility operates under an operation certificate. The additional rate-difference payment is due within 90 days after the fiscal year closes.

Alternative fuel tax breaks last longer

The law moves the repeal date for specified alternative-fuel tax benefits to September 1, 2031. These benefits include tax exemptions, reimbursements, and credits under the referenced 2006 law. Existing eligibility requirements remain unchanged; benefit amounts are not stated in this chunk.

City companies exclude certain foreign receipts

New York City changes how covered companies count federal section 951A income in their tax receipts fraction. After the specified section 250 deduction, this income is excluded from the numerator and included in the denominator. This reduces the share of receipts assigned to the city by that calculation. The updated rule for tax years beginning after December 31, 2024, uses federal law in effect for each tax year.

Five redevelopment sites gain tax credits

The law makes five sites eligible for New York brownfield redevelopment credits, with site-specific cleanup and completion dates. Broadway and Spencer Street in Albany requires a cleanup agreement before December 20, 2013, and completion certification by December 31, 2017. Manhattan's 555 West 34th Street, also called 400 Eleventh Avenue, requires an agreement before December 22, 2007, and certification by December 19, 2012. At 125 Bath Street in Milton/Ballston Spa, the dates are before February 1, 2013, and by December 31, 2019. At 4630 River Road in Tonawanda, they are before July 31, 2014, and by December 16, 2016. Rochester's 18 Ambrose Street and rear 214 Lake Avenue parcel, including Haidt Place, requires an agreement before June 16, 2005, and certification by December 31, 2017. Qualified property must enter service before tax year 2031, or before tax year 2033 for the Manhattan site. Site-preparation and groundwater-cleanup costs have a five-year window after the service year; tangible-property costs have a ten-year window. The separate section 22 credit runs for ten consecutive tax years starting in the service year, no later than 2031, or 2033 in Manhattan. Developers acquiring a site from a completion-certificate holder can also claim that credit when the acquisition occurs no later than the same site-specific deadline.

Harness tracks gain annual tax caps

Beginning in state fiscal year 2026, each harness track's annual aggregate wagering tax has a cap. The cap equals the tax attributable to its live racing handle paid in state fiscal year 2024. This limits track taxes, not household payments directly.

Property investment transfers keep tax treatment

Qualifying real estate investment trust transfers retain their specified New York State and New York City tax treatment through August 31, 2029. Transactions must meet the existing statutory requirements for these transfers. The provision does not state tax rates or savings.

Racing businesses shed specified payment obligations

Specified off-track betting corporations and simulcast theaters no longer must pay 50% of breaks to the breeding and development fund. Their retained-sum tax rates follow the referenced racing law. Franchised thoroughbred corporations no longer owe the specified additional state tax on unused purse money. They still must use a purse allocation in the year set aside or the following year.

Racing operators pay fewer state charges

The law removes specified extra taxes on racing purse money left unused after the following year. Harness operators must still use unused overnight-race purse allocations during the following year. Harness groups no longer face the former 0.25-percentage-point tax increase for missing specified improvement-spending and event requirements. They also no longer pay the state 50% of rounding leftovers from specified on-track regular, multiple, exotic, and super exotic bets. These changes do not establish a direct payment to bettors.

Utility property assessment ceilings last longer

Assessment ceilings for covered local public utility property last 16 years after their effective date, instead of 12 years. This extends the limits used when assessing that property for local taxes. The provision does not state a change to household tax bills or utility rates.

Vessel petroleum businesses file taxes less often

Petroleum businesses operating qualifying commercial vessels file annual returns instead of monthly returns. Annual returns are due March 20 and cover the four immediately preceding sales-tax quarters. The return for March 1, 2026 through February 28, 2027 is due March 20, 2027. Monthly returns remain required for periods ending on or before the law's effective date.

Nicotine products face expanded tax rules

New York extends tobacco-product tax rules to noncombustible products containing nicotine but no tobacco, intended for human use. Vapor products and FDA-regulated drugs or devices are excluded. The rules include distributor requirements, penalties, and a personal-use exemption for 75 or fewer units. Transport invoices are required above 15 units for dealers or distributors, and above 75 units for others. A unit means the container or, without a container, the consumer-sale wrapping.

Betting officials face licensing and job limits

Off-track betting board appointees cannot attend or participate in meetings, including executive sessions, before commission license approval. For five years after leaving, former board members and officers cannot be appointed or reappointed to the corporation. They also face limits on specified paid representation or advocacy before it, regardless of why they left. Former officials cannot provide services on matters they personally handled or actively considered during their service.

Large nicotine tax evasion becomes felony

Beginning September 1, 2026, willfully evading New York tobacco taxes involving 6,600 or more alternative nicotine product units is a class E felony. The rule covers attempts to evade the tax or its payment. It does not create a general consumer reporting duty.

Officers can seize nicotine and import vehicles

Beginning September 1, 2026, officers may seize more than 150 alternative nicotine units held for sale without tax paid or assumed by an appointed distributor. The products are forfeited for destruction or law-enforcement use, subject to legal restrictions. Officers may also seize transportation used by a non-appointed importer to bring in more than 150 units for sale. Transportation used by common carriers in their business is excluded.

Tougher penalties for handling untaxed nicotine

Beginning September 1, 2026, knowing possession or transport of untaxed alternative nicotine products triggers new misdemeanor thresholds. Dealers who are not appointed distributors face the rule above 150 units; non-dealers who are not appointed distributors face it above 225. Those offenses carry up to a $5,000 fine or 30 days in jail. A separate rule covers non-appointed distributors handling 750 or more untaxed units; after two convictions under that rule, later violations are class E felonies regardless of quantity. Possessing or transporting 225 or more units at once is evidence they are held for taxable sale, except for appointed distributors.

Unauthorized nicotine imports face criminal penalties

Beginning September 1, 2026, non-appointed distributors commit a misdemeanor by importing more than 15 alternative nicotine units for New York sale. The rule also covers producing, manufacturing, or compounding tobacco products in the state without appointment. Importing or producing 7,500 or more alternative nicotine units within any 90 days is also a misdemeanor. After two convictions under this section, a later violation is a class E felony regardless of quantity.

Harness tracks must maintain minimum racing activity

Harness-racing associations and corporations must hold at least 90% of their 1985 or 1986 programs and races, whichever baseline is lower. A shortfall is excused for demonstrated good cause beyond their control. The Gaming Commission can also excuse activity it finds uneconomical or impractical. The law replaces earlier special tax-rate schedules and tax-computation rules tied to falling short.

Higher testing fees for racehorse owners

Beginning January 1, 2027, added start fees for standardbred horses cover 50% of yearly on-track TCO2 testing costs. Authorized racing corporations or associations pay the other 50% into the racing regulation account. If a horse does not start, its owner gets the added fee refunded or credited to their account. The New York State Gaming Commission sets fee amounts and how and when payments are made. Each year, it must notify the affected owners’ and trainers’ organization and racing corporations or associations of amounts by January 31.

Racing operators face event and spending requirements

Zone-two racing corporations must run at least 90% of their 1985 or 1986 programs and races, using the lower count. The rule applies to calendar years starting January 1, 1989; the commission can excuse uncontrollable, uneconomical, or impractical shortfalls. The franchised corporation must hold at least 95 Aqueduct racing days during December through April. Fewer days require written agreement from specified horsemen's and breeders' groups and commission approval; approved uncontrollable cancellations do not count as failures. Covered Westchester and Nassau harness operators must spend at least 0.5% of prior-year on-track bets during each 12-month period starting April 1 on facility improvements and special events. Each track must hold five commission-approved events annually outside ordinary business to promote attendance. The commission considers the average of the two prior 12-month calendar periods when assessing improvement spending.

City businesses use older equipment limits

For tax years beginning after December 31, 2024, New York City adds back the federal equipment-expensing deduction. It then allows a deduction using the dollar limits from the last tax year beginning before January 1, 2025. One adjustment uses calendar year 2017 instead of 2016. The rule covers unincorporated business, general corporation, banking corporation, and business corporation taxes; dollar limits are not supplied.

Localities gain power to tax breaks

The law removes the racing-law ban on local taxes on pari-mutuel breaks. Counties, cities, towns, villages, and other local governments are no longer barred by that section from taxing breaks. Other applicable laws still govern their authority. This law does not itself impose a local tax, set a rate, or specify who pays.

Racing corporations lose two tax credits

Racing corporations lose the state wagering-tax credit for qualifying payments to the thoroughbred breeding and development fund. Their required fund payments remain. Zone-two racing corporations also lose the simulcast credit worth 0.4% of daily pools. The related requirement to devote 60% of that credit to overnight-race purses ends because the credit is removed.

Businesses must renew sales-tax certificates

The state must complete sales-tax certificate reregistration by December 31, 2030. Current holders receive at least 180 days' notice and must submit complete applications at least 90 days before expiration. The state must issue a replacement lasting at least three years or propose refusal. A holder challenging refusal can receive an expedited hearing within 30 days after the state receives the petition.

Harness horses face pre-race testing

The Gaming Commission tests standardbred horses for excess total carbon dioxide before races at licensed harness tracks. Random samples cover at least three horses or 50% of horses programmed to race, whichever is higher. Authorized personnel collect samples at commission-set times and places; trainers or representatives must accompany selected horses and follow directions. Horses testing above the limit must be scratched. Willful failure to appear, refusal, or interference can lead to discipline.

Betting revenue shifts to horse breeding funds

Regional off-track betting corporations send 20% of out-of-state harness breakage and 50% of other out-of-state race breakage to breeding funds. Those payments are split equally between the agriculture and horse-breeding fund and the thoroughbred breeding fund. They also send 10% of retained out-of-state quarter-horse breakage to the quarter-horse breeding fund. Breakage is excluded from monthly distributions of the 5% betting surcharge, including Catskill-region mixed meetings. Franchised tracks continue paying 0.7% of regular, multiple, and exotic pools to the thoroughbred breeding fund through December 31, 2027.

Health funding receives designated tobacco revenues

The comptroller deposits designated tobacco control and insurance initiatives revenues into the HCRA resources fund. This applies to specified tax amounts required to be credited to the tobacco control and insurance initiatives pool. The provision changes state fund allocations, not individual benefit eligibility, and does not state an amount.

City separates residential surcharge tax calculations

New York City treats the residential surcharge separately from ordinary property taxes. Its revenue is excluded when calculating property-class levy shares, allocating the levy, and setting class tax rates. For the specified City Charter calculation, it counts as revenue other than real-property taxes. This accounting rule does not itself state a change to an owner's tax bill.

Racing operators use revised tax formulas

Covered thoroughbred and harness operators use the applicable tax percentages in the referenced racing law instead of prior rate formulas. Harness operators in Westchester or Nassau County also face the referenced statutory rate limit. Quarter-horse tax language states 8% of retained sums plus 65% of specified on-track breaks, with payment governed by that law. Regional off-track betting corporations' live-race tax is stated as a percentage of total money wagered. Related simulcast and out-of-state wagering taxes also use the referenced rates, which this chunk does not fully supply.

Sponsors & Cosponsors

Sponsor

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Cosponsors

There are no cosponsors for this bill.

Roll Call Votes

All Roll Calls

Yes: 148 • No: 79

committee vote • 5/27/2026

Finance Committee Vote

Yes: 19 • No: 3

Senate vote • 5/27/2026

FLOOR Vote

Yes: 38 • No: 24

House vote • 5/27/2026

Assembly floor vote

Yes: 91 • No: 52

Actions Timeline

SIGNED CHAP.59
5/28/2026Senate
DELIVERED TO GOVERNOR
5/28/2026Senate
RETURNED TO SENATE
5/27/2026House
PASSED ASSEMBLY
5/27/2026House
MESSAGE OF NECESSITY - 3 DAY MESSAGE
5/27/2026House
ORDERED TO THIRD READING RULES CAL.217
5/27/2026House
SUBSTITUTED FOR A10009C
5/27/2026House
REFERRED TO WAYS AND MEANS
5/27/2026House
DELIVERED TO ASSEMBLY
5/27/2026Senate
PASSED SENATE
5/27/2026Senate
MESSAGE OF NECESSITY - 3 DAY MESSAGE
5/27/2026Senate
ORDERED TO THIRD READING CAL.1334
5/27/2026Senate
PRINT NUMBER 9009C
5/26/2026Senate
AMEND (T) AND RECOMMIT TO FINANCE
5/26/2026Senate
PRINT NUMBER 9009B
3/9/2026Senate
AMEND (T) AND RECOMMIT TO FINANCE
3/9/2026Senate
PRINT NUMBER 9009A
2/20/2026Senate
AMEND (T) AND RECOMMIT TO FINANCE
2/20/2026Senate
REFERRED TO FINANCE
1/21/2026Senate

Bill Text

Amendment C
5/26/2026
PDF
Amendment B
3/9/2026
PDF
Amendment A
2/20/2026
PDF
Original
1/21/2026
PDF

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