KeshaH
Expert Alumni

State tax filing

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Due to your income level, you're subject to the state's "taxable benefit recapture" law. This law is New York's way to recoup some of the tax benefits from higher-income taxpayers. 

 

As you have seen, New York has tax brackets with progressively higher rates as your income rises. Normally, everyone benefits from the lower rates on the lower bands of income. This recapture provision essentially removes that benefit for higher-income taxpayers by adding an extra amount to their tax bill. 

 

This effectively creates a flat tax rate for high-income taxpayers.