Update - July 15, 2026
After a formal request from County Executive Metzger and members of the County Legislature, the enabling State legislation for the Ulster County for Fair Taxes Act has been amended by State Senator Michelle Hinchey and Assemblymember Sarahana Shrestha.
You can read more about the amendments in our recent press release.
The County Legislature approved an amended Home Rule Request at its July 14 session.
The content of this page has been updated to reflect the amended proposal.
The Ulster County for Fair Taxes Act is intended to reduce the County's reliance on property taxes – it will help us continue funding essential services while lowering the tax burden on low- and middle-income residents, and on our farms and small businesses.
If the proposed state legislation is passed in 2027, the County could choose to apply an income tax surcharge to taxable income earned above $500,000 for couples and $250,000 for individuals.
Why now?
Over the next two and a half years, the federal government is cutting its share of funding to programs like SNAP and Medicaid, which tens of thousands of Ulster County residents rely on, by shifting costs to states and counties.
We need to plan today for how we will respond to these cost shifts.
Ulster County currently funds services through property and sales taxes, which are regressive, meaning that these taxes take a larger share of income from low-income earners than from high-income earners.
At the same time, federal income tax cuts have disproportionately benefited the highest income levels. The federal government has effectively shifted the tax burden from wealthy income taxpayers to our residents, farms, and small businesses in the form of either higher property or sales taxes. Those who are struggling the most are being asked to bear the greatest brunt of the shift.
What would the Act do?
The Ulster County for Fair Taxes Act would create a local surcharge on the State Income Tax paid by higher-income residents. The surcharge would apply only to the tax paid on income above $250,000 for single filers and $500,000 for joint filers – not to total income.
This surcharge would have
no effect on the vast majority of households in Ulster County. Only about 1% of households countywide make enough taxable income to pay the surcharge.
Only about 1 in 100 households in Ulster County make enough taxable income for this surcharge to apply.
Even for those high-income households, the surcharge would typically represent less than one percent of their total income.
How does the surcharge work?
Up to and including a certain threshold of taxable income — $500,000 for joint filers or $250,000 for single filers — there would be no surcharge at all.
Above the threshold, the surcharge would be 18.75% of the state tax paid, but only on additional income over the threshold.
For example, joint filers with $600,000 of taxable income might pay a total surcharge of $1,200-1,300; single filers with $300,000 of taxable income might pay $600-700. Tax situations vary widely, so this is only an example.
What is the process for enacting the Ulster County for Fair Taxes Act?
Several State and County legislative actions would need to be taken before enacting the Ulster County for Fair Taxes Act.
Step 1: State legislation must be introduced at the request of the local jurisdiction to provide the necessary state authorization. At the request of the County Executive’s Office, State Senator Michelle Hinchey and Assembly Member Sarahana Shrestha have introduced A11460A/S10532A in order to initiate a “Home Rule Request” by the County Legislature.
Step 2: The County Legislature must consider and pass a “Home Rule Request” for the bill.
Step 3: The bill must be passed by the State Legislature and signed into law by the Governor. The 2026 State Legislative session ended on June 4, so the earliest the state legislation could be passed is in the 2027 Legislative Session.
Step 4: After the necessary state legislation is passed, the County Legislature must draft and pass a Local Law enacting the Ulster County for Fair Taxes Act. Passing a local law requires one or more public hearings, which would occur in 2027 at the earliest.
In short, the County is at the beginning of the process, with ample time for public input.
Frequently Asked Questions
How does this affect farmers or farm owners?
Most farmers report farm income on Schedule F, which subtracts farm expenses from taxable income. Because these farmers are not paying New York State personal income tax on farm revenues before expenses, the Ulster County surcharge also does not apply to business revenues, only to the profits that are taken home by the farmer.
Farmers also benefit from a revenue stream that offsets property and sales taxes, which increase their operating costs.
How does this affect a small business owner?
Every business is unique, and the impact will depend on how the business is legally structured and the business owner’s income in relation to the business.
Generally speaking, the Ulster County for Fair Taxes Act can benefit small businesses in two ways: 1) by helping to make it more affordable for their workers to remain here; and 2) by moderating the impact of property and sales taxes on operating costs.
How does this affect a resident selling their home?
A person selling their primary residence currently pays income tax only on the profit after subtracting the original purchase price and any capital improvements, and only on the profit that exceeds $250,000 for single filers or $500,000 for joint filers. Because a person selling their home does not pay New York State income tax on profit below those thresholds, the Ulster County surcharge also does not apply to that profit.
Does this surcharge apply to inheritance?
No, inheritance is not considered taxable income in New York State, so this surcharge would have no effect on inheritance.
Is this an estate tax?
No. The Ulster County for Fair Taxes Act is not an estate tax or an inheritance tax. An estate tax taxes the value of an estate left behind when someone dies. This surcharge does not do this in any way and would not be triggered by a death.
Why does the State bill mention estates and trusts?
The bill mentions estates and trusts so that the surcharge aligns with the existing New York State income tax system. As an example of how this works in practice, when a person dies, their assets are often transferred into an estate before being inherited by beneficiaries. Occasionally, like in the case of a legal dispute over inheritance, those assets may sit for a prolonged time, sometimes conducting considerable business and generating taxable income before anyone has inherited them. In those cases, the estate or trust itself owes State income tax, and the fiduciary who manages it must file a State income tax return on its behalf. The surcharge would apply to New York State income tax paid only on that newly generated income while the estate was in between owners.
*Please note: The answers above are provided for general informational purposes only, and are not intended as advice for tax purposes.