New York Advisory Opinion TSB-A-82(8)I: Is a death benefit received by a public safety officer's widow under the federal Public Safety Officers' Benefits Act subject to New York personal income tax?

Plain-English summary

Doris Palmore, a widow, received proceeds under the federal Public Safety Officers' Benefits Act of 1976 (Public Law 94-430) following a determination by the Law Enforcement Assistance Administration that her husband, a public safety officer, died as the direct and proximate result of a personal injury sustained in the line of duty. She asked how those proceeds should be treated for New York State personal income tax purposes.

The Department's analysis started from Tax Law § 612(a), which makes federal adjusted gross income the starting point for a resident's New York adjusted gross income, subject to certain modifications. Under Internal Revenue Code § 104(a) - confirmed by Rev. Rul. 77-235 - death benefits paid under the Public Safety Officers' Benefits Act are excluded from federal gross income entirely, meaning they never enter federal adjusted gross income in the first place.

Because the payments are already excluded before they ever reach federal adjusted gross income, and because Tax Law § 612 contains no provision requiring such payments to be added back into New York adjusted gross income, the Department concluded the benefit isn't taxed by New York either. There's no separate New York add-back rule that would pull this federally tax-exempt death benefit into the state tax base.

What this means for you

Surviving family members of public safety officers receiving federal line-of-duty death benefits

This benefit is fully excluded from both federal and New York income tax. You don't need to report it as income on your New York return, since it never enters your federal adjusted gross income (the starting point for the New York computation) and New York has no rule adding it back.

Accountants preparing returns for beneficiaries of federal public safety officer death benefits

Confirm the payment qualifies under the Public Safety Officers' Benefits Act's line-of-duty death standard (a Law Enforcement Assistance Administration determination), then simply exclude it consistent with its federal IRC § 104(a) treatment - no New York-specific modification or add-back applies.

Anyone assuming any income excluded federally must be checked against a New York add-back list

This opinion illustrates the general principle that New York's income tax largely follows the federal exclusion unless a specific New York statute requires otherwise - here, no such statute exists for this benefit, so the federal exclusion simply carries through.

Common questions

Q: I received a death benefit under the federal Public Safety Officers' Benefits Act - do I owe New York income tax on it?
A: No. It's excluded from federal gross income under IRC § 104(a), and Tax Law § 612 has no provision adding such payments back into New York adjusted gross income, so it remains untaxed in New York too.

Q: Do I need to do anything special on my New York return to exclude this benefit?
A: Since the payment never enters federal adjusted gross income (New York's starting point) and there's no New York add-back for it, no special New York modification is needed - the federal exclusion carries through automatically.

Q: Does this exclusion depend on how the officer died?
A: Yes - the underlying federal exclusion applies specifically to death benefits paid after a determination that the officer died as the direct and proximate result of a personal injury sustained in the line of duty, per the Public Safety Officers' Benefits Act's own eligibility standard.

Source

• Landing page: https://www.tax.ny.gov/pubs_and_bulls/advisory_opinions/income_ao_1982.htm
• Opinion: https://www.tax.ny.gov/pdf/advisory_opinions/income/a82_8i.pdf

Original ruling text

New York State Department of Taxation and Finance
TSB-A-82 (8) I
Income Tax
October 15, 1982

Taxpayer Services Division
Technical Services Bureau
STATE OF NEW YORK
STATE TAX COMMISSION
ADVISORY OPINION

PETITION NO. I820902A

On September 2, 1982, a Petition for Advisory Opinion was received from Doris Palmore,
2040 Tennessee Avenue, Niagara Falls, New York 14305.
The issue raised by Petitioner is the proper treatment, for purposes of the State Personal
Income Tax imposed under Article 22 of the Tax Law, of the proceeds received by a widow under
Public Law 94-430, the Public Safety Officers' Benefits Act of 1976.
Section 612(a) of the Tax Law provides that the New York adjusted gross income of a
resident individual, the starting point in determining New York taxable income, means Federal
adjusted gross income, with certain modifications. Death benefits received pursuant to the above­
cited Federal statute are made by the Law Enforcement Assistance Administration, upon a
determination that "a public safety officer has died as the direct and proximate result of a personal
injury sustained in the line of duty." Such payments are excluded from Federal gross income, and
therefore Federal adjusted gross income, pursuant to section 104(a) of the Internal Revenue Code.
Rev. Rul. 77-235, 1977 CB 45. Inasmuch as section 612 of the Tax Law does not provide for a
modification based on the receipt of such payments, such amounts are not required to be added to
Federal adjusted gross income in determining New York adjusted gross income.

DATED: October 12, 1982

s/LOUIS ETLINGER
Deputy Director
Technical Services Bureau

ROBERT W. BOUCHARD, ACTING COMMISSIONER
LOUIS M. JACOBSON, DEPUTY COMMISSIONER
FRANK J. PUCCIA, DIRECTOR
TP-8 (8/82)