Exemptions from New York's estate taxes would rise from $1 million to $2.06 million immediately and up to $5.25 million in 2017. The tax rate would remain 16 percent.
Sen. Liz Krueger, a Manhattan Democrat, criticized the new tax proposals saying that it was disproportionately advantageous for wealthy New Yorkers.
"The only thing I know for sure is that the wealthiest homeowners in the wealthiest communities are the winners," Krueger said on the floor of the Senate.
Funding also includes a 2 percent inflation adjustment to for caretakers of the disabled and others at state-funded nonprofits in their pay starting next year, with another planned four months later.
Another provision in the budget package protects insured patients from surprise out-of-network medical bills starting in one year. It would require better disclosures from doctors and hospitals about facilities in a patient's network and subject related billing disputes to arbitration between the medical provider and insurance company.
The budget contains almost $138 billion for the coming year. Officials also estimate getting another $5 billion in one-time federal aid for further rebuilding after Superstorm Sandy and the rollout of the Affordable Care Act to extend health coverage to uninsured New Yorkers.
Following the vote, applause and cheers were heard through the Capitol hallways as the Senate stands adjourned until April 23.
Associated Press writer Jonathan Lemire in New York City contributed to this report.