A 8583: Allows an organization included on the federal list of tax-exempt organizations under section 501(c)(3) of title 26 of the United States code on March first, two thousand twenty-five to automatically maintain their tax-exempt status for New York state purposes; provides for the repeal of such provisions upon the expiration thereof.

  
  STATE OF NEW YORK ________________________________________________________________________ 8583 2025-2026 Regular Sessions  IN ASSEMBLY May 21, 2025 ___________ Introduced by M. of A. GLICK -- read once and referred to the Committee on Ways and Means AN ACT to amend the tax law, in relation to enacting the "New York Preventing Revocation of Organizations' Tax-Exempt Classifications by Trump Act" or the "NY-PROTECT ACT"; and providing for the repeal of such provisions upon expiration thereof The People of the State of New York, represented in Senate and Assem- bly, do enact as follows: 1 Section 1. This act shall be known and may be cited as the "New York 2 Preventing Revocation of Organizations' Tax-Exempt Classifications by 3 Trump Act" or the "NY-PROTECT ACT". 4 § 2. The tax law is amended by adding a new section 27-a to read as 5 follows: 6 § 27-a. Improper suspension of tax-exempt status by the United States 7 Internal Revenue Service. 1. Notwithstanding any state or local law, 8 every organization designated by the Internal Revenue Service of the 9 United States under section 501(c)(3) of the Internal Revenue Code as a 10 tax-exempt organization as of January nineteenth, two thousand twenty- 11 five shall automatically maintain their tax-exempt status for New York 12 state purposes until the earlier of: (a) a determination by the commis- 13 sioner pursuant to an application as provided by this section; or (b) 14 January first, two thousand twenty-six. 15 2. (a) Within ninety days of the effective date of this section, the 16 commissioner shall establish a procedure or application allowing an 17 organization that believes that the United States Internal Revenue 18 Service illegally or improperly revoked its designation as a tax-exempt 19 organization under section 501(c)(3) of the Internal Revenue Code to 20 establish to the satisfaction of the commissioner that the organization 21 meets the requirements of that section without regard to such revocation 22 or federal status. The commissioner shall designate such organization as 23 a "state protected not-for-profit organization" upon such satisfaction. EXPLANATION--Matter in italics (underscored) is new; matter in brackets [ ] is old law to be omitted. LBD11734-02-5 
 A. 8583 2 1 (b) The commissioner shall automatically designate an organization as 2 a "state protected not-for-profit organization" if the organization 3 provides to the commissioner a copy of a federal or state court ruling 4 in effect holding that the United States Internal Revenue Service acted 5 or likely acted illegally when it revoked the tax-exempt status of the 6 organization, regardless of whether the United States Internal Revenue 7 Service has complied with or is appealing such ruling. 8 3. An organization whose request to be designated as a "state 9 protected not-for-profit organization" is denied by the commissioner 10 shall have the right to appeal the determination using the procedure 11 prescribed by article forty of this chapter or otherwise prescribed 12 pursuant to this chapter, and must, in such proceeding, challenge the 13 merits of the determination made by the United States Internal Revenue 14 Service. 15 4. A "state protected not-for-profit organization" shall maintain its 16 tax-exempt status under New York state and local law without regard to 17 the change in its federal status. It shall, notwithstanding any other 18 state or local law or rule, be treated as if it were an organization 19 designated as a 501(c)(3) organization by the United States Internal 20 Revenue Service in respect to any tax, fee or other imposition adminis- 21 tered by the commissioner; and in respect to any sale, transfer or 22 assignment; and in respect to any tax, fee or other imposition adminis- 23 tered by a local government; and in respect to any contract, grant, 24 benefit, license, obligation, qualification, procedure or program estab- 25 lished or operated by or with the state or a local government, inclusive 26 of any agency, authority or subdivision thereof. 27 5. (a) The commissioner shall provide a determination to an organiza- 28 tion satisfying the requirements imposed by subdivision two of this 29 section with respect to a certification of its designation as a "state 30 protected not-for-profit organization" within thirty days of receipt of 31 a completed application. 32 (b) Notwithstanding any state or local law, rule or regulation or 33 procedure, this certification shall be accepted in lieu of any require- 34 ment that an organization provide documentation, or otherwise certify or 35 affirm, that it is an organization exempt from taxation under section 36 501(c)(3) of the Internal Revenue Code. 37 (c) The certification shall remain in effect until the earlier of 38 either April fifteenth of the year following the issuance of such 39 certificate, or one year after the date that the United States Internal 40 Revenue Service restores the designation of the organization as tax-ex- 41 empt; provided that the commissioner may revoke the certificate and 42 designation at any time if the commissioner determines that the organ- 43 ization: (i) no longer satisfies the requirements set forth in subdivi- 44 sion two of this section; or (ii) provided false information material to 45 the determination of the commissioner that the organization satisfied 46 such requirements. 47 (d) The commissioner may establish a truncated application or proce- 48 dure to allow for the renewal or re-issuance of such certification. 49 § 3. This act shall take effect immediately and shall be deemed to 50 have been in full force and effect on and after January 19, 2025, and 51 shall expire and be deemed repealed January 20, 2029.