There is a newer version of the New York Consolidated Laws
2006 New York Code - Computation Of Tax.
§ 210. Computation of tax. 1. The tax imposed by subdivision one of
section two hundred nine of this chapter shall be: (A) in the case of
each taxpayer other than a New York S corporation or a qualified
homeowners association, the sum of (1) the highest of the amounts
prescribed in paragraphs (a), (b), (c) and (d) of this subdivision and
(2) the amount prescribed in paragraph (e) of this subdivision, (B) in
the case of each New York S corporation, the amount prescribed in
paragraph (g) of this subdivision, and (C) in the case of a qualified
homeowners association, the sum of (1) the highest of the amounts
prescribed in paragraphs (a), (b) and (c) of this subdivision and (2)
the amount prescribed in paragraph (e) of this subdivision. For purposes
of this paragraph, the term "qualified homeowners association" means a
homeowners association, as such term is defined in subsection (c) of
section five hundred twenty-eight of the internal revenue code without
regard to subparagraph (E) of paragraph one of such subsection (relating
to elections to be taxed pursuant to such section), which has no
homeowners association taxable income, as such term is defined in
subsection (d) of such section. Provided, however, that in the case of a
small business taxpayer (other than a New York S corporation) as defined
in paragraph (f) of this subdivision, if the amount prescribed in such
paragraph (b) is higher than the amount prescribed in such paragraph (a)
solely by reason of the application of the rate applicable to small
business taxpayers, then with respect to such taxpayer the tax referred
to in the previous sentence shall be the sum of (1) the highest of the
amounts prescribed in paragraphs (a), (c) and (d) of this subdivision
and (2) the amount prescribed in paragraph (e) of this subdivision.
(a) Entire net income base. For taxable years beginning before July
first, nineteen hundred ninety-nine, the amount prescribed by this
paragraph shall be computed at the rate of nine percent of the
taxpayer's entire net income base. For taxable years beginning after
June thirtieth, nineteen hundred ninety-nine and before July first, two
thousand, the amount prescribed by this paragraph shall be computed at
the rate of eight and one-half percent of the taxpayer's entire net
income base. For taxable years beginning after June thirtieth, two
thousand and before July first, two thousand one, the amount prescribed
by this paragraph shall be computed at the rate of eight percent of the
taxpayer's entire net income base. For taxable years beginning after
June thirtieth, two thousand one, the amount prescribed by this
paragraph shall be computed at the rate of seven and one-half percent of
the taxpayer's entire net income base. The taxpayer's entire net income
base shall mean the portion of the taxpayer's entire net income
allocated within the state as hereinafter provided, subject to any
modification required by paragraphs (d) and (e) of subdivision three of
this section. However, in the case of a small business taxpayer, as
defined in paragraph (f) of this subdivision, the amount prescribed by
this paragraph shall be computed as follows:
(i) if the entire net income base is not more than two hundred
thousand dollars, (1) for taxable years beginning before July first,
nineteen hundred ninety-nine, the amount shall be eight percent of the
entire net income base; (2) for taxable years beginning after June
thirtieth, nineteen hundred ninety-nine and before July first, two
thousand three, the amount shall be seven and one-half percent of the
entire net income base; and (3) for taxable years beginning after June
thirtieth, two thousand three and before January first, two thousand
five, the amount shall be 6.85 percent of the entire net income base;
(ii) if the entire net income base is more than two hundred thousand
dollars but not over two hundred ninety thousand dollars, (1) for
taxable years beginning before July first, nineteen hundred ninety-nine,
the amount shall be the sum of (a) sixteen thousand dollars, (b) nine
percent of the excess of the entire net income base over two hundred
thousand dollars and (c) five percent of the excess of the entire net
income base over two hundred fifty thousand dollars; (2) for taxable
years beginning after June thirtieth, nineteen hundred ninety-nine and
before July first, two thousand, the amount shall be the sum of (a)
fifteen thousand dollars, (b) eight and one-half percent of the excess
of the entire net income base over two hundred thousand dollars and (c)
five percent of the excess of the entire net income base over two
hundred fifty thousand dollars; (3) for taxable years beginning after
June thirtieth, two thousand and before July first, two thousand one,
the amount shall be the sum of (a) fifteen thousand dollars, (b) eight
percent of the excess of the entire net income base over two hundred
thousand dollars and (c) two and one-half percent of the excess of the
entire net income base over two hundred fifty thousand dollars; (4) for
taxable years beginning after June thirtieth, two thousand one and
before July first, two thousand three, the amount shall be seven and
one-half percent of the entire net income base; and (5) for taxable
years beginning after June thirtieth, two thousand three and before
January first, two thousand five, the amount shall be the sum of (a)
thirteen thousand seven hundred dollars, (b) 7.5 percent of the excess
of the entire net income base over two hundred thousand dollars and (c)
3.25 percent of the excess of the entire net income base over two
hundred fifty thousand dollars;
(iii) for taxable years beginning on or after January first, two
thousand five, if the entire net income base is not more than two
hundred ninety thousand dollars the amount shall be six and one-half
percent of the entire net income base; if the entire net income base is
more than two hundred ninety thousand dollars but not over three hundred
ninety thousand dollars the amount shall be the sum of (1) eighteen
thousand eight hundred fifty dollars, (2) seven and one-half percent of
the excess of the entire net income base over two hundred ninety
thousand dollars but not over three hundred ninety thousand dollars and
(3) seven and one-quarter percent of the excess of the entire net income
base over three hundred fifty thousand dollars but not over three
hundred ninety thousand dollars;
(iv) if the taxable period to which subparagraphs (i), (ii) and (iii)
of this paragraph apply is less than twelve months, the amount
prescribed by this paragraph shall be computed as follows:
(A) Multiply the entire net income base for such taxpayer by twelve;
(B) Divide the result obtained in (A) by the number of months in the
taxable year;
(C) Compute an amount pursuant to subparagraphs (i) and (ii) as if the
result obtained in (B) were the taxpayer's entire net income base;
(D) Multiply the result obtained in (C) by the number of months in the
taxpayer's taxable year;
(E) Divide the result obtained in (D) by twelve.
(b) Capital base. (1) The amount prescribed by this paragraph shall be
computed at one and seventy-eight hundredths mills for each dollar of
the taxpayer's total business and investment capital, or the portion
thereof allocated within the state as hereinafter provided, except that
in the case of a cooperative housing corporation as defined in the
internal revenue code, the applicable rate shall be four-tenths of a
mill. In no event shall the amount prescribed by this paragraph exceed
three hundred fifty thousand dollars for manufacturers and one million
dollars for all other taxpayers.
(2) For purposes of subparagraph one of this paragraph, the term
"manufacturer" shall mean a taxpayer which during the taxable year is
principally engaged in the production of goods by manufacturing,
processing, assembling, refining, mining, extracting, farming,
agriculture, horticulture, floriculture, viticulture or commercial
fishing. Moreover, for purposes of computing the capital base in a
combined report, the combined group shall be considered a "manufacturer"
for purposes of this subparagraph only if the combined group during the
taxable year is principally engaged in the activities set forth above,
or any combination thereof. A taxpayer or a combined group shall be
"principally engaged" in activities described above if, during the
taxable year, more than fifty percent of the gross receipts of the
taxpayer or combined group, respectively, are derived from receipts from
the sale of goods produced by such activities. In computing a combined
group's gross receipts, intercorporate receipts shall be eliminated.
(c) Minimum taxable income bases. (i) For taxable years beginning
after nineteen hundred eighty-six and before nineteen hundred
eighty-nine, the amount prescribed by this paragraph shall be computed
at the rate of three and one-half percent of the taxpayer's pre-nineteen
hundred ninety minimum taxable income base. For taxable years beginning
in nineteen hundred eighty-nine, the amount prescribed by this paragraph
shall be computed at the rate of five percent of the taxpayer's
pre-nineteen hundred ninety minimum taxable income base. A "taxpayer's
pre-nineteen hundred ninety minimum taxable income base" shall mean the
portion of the taxpayer's entire net income allocated within the state
as hereinafter provided, subject to any modification required by
paragraphs (d) and (e) of subdivision three of this section;
(ii) For taxable years beginning in nineteen hundred ninety, nineteen
hundred ninety-one, nineteen hundred ninety-two, nineteen hundred
ninety-three and nineteen hundred ninety-four the amount prescribed by
this paragraph shall be computed at the rate of five percent of the
taxpayer's minimum taxable income base. For taxable years beginning
after nineteen hundred ninety-four and before July first, nineteen
hundred ninety-eight, the amount prescribed by this paragraph shall be
computed at the rate of three and one-half percent of the taxpayer's
minimum taxable income base. For taxable years beginning after June
thirtieth, nineteen hundred ninety-eight and before July first, nineteen
hundred ninety-nine, the amount prescribed by this paragraph shall be
computed at the rate of three and one-quarter percent of the taxpayer's
minimum taxable income base. For taxable years beginning after June
thirtieth, nineteen hundred ninety-nine and before July first, two
thousand, the amount prescribed by this paragraph shall be computed at
the rate of three percent of the taxpayer's minimum taxable income base.
For taxable years beginning after June thirtieth, two thousand, the
amount prescribed by this paragraph shall be computed at the rate of two
and one-half percent of the taxpayer's minimum taxable income base. The
"taxpayer's minimum taxable income base" shall mean the portion of the
taxpayer's minimum taxable income allocated within the state as
hereinafter provided, subject to any modifications required by
paragraphs (d) and (e) of subdivision three of this section.
(d) Fixed dollar minimum. (1) The amount prescribed by this paragraph
shall be for a taxpayer which during the taxable year has:
(A) a gross payroll of six million two hundred fifty thousand dollars
or more, one thousand five hundred dollars;
(B) a gross payroll of less than six million two hundred fifty
thousand dollars but more than one million dollars, four hundred
twenty-five dollars;
(C) a gross payroll of no more than one million dollars but more than
five hundred thousand dollars, three hundred twenty-five dollars;
(D) a gross payroll of no more than five hundred thousand dollars but
more than two hundred fifty thousand dollars, two hundred twenty-five
dollars;
(E) a gross payroll of two hundred fifty thousand dollars or less
(except as prescribed in clause (F) of this subparagraph), one hundred
dollars;
(F) a gross payroll of one thousand dollars or less, with total
receipts within and without this state of one thousand dollars or less,
and the average value of the assets of which are one thousand dollars or
less, eight hundred dollars.
(2) For purposes of this paragraph:
(A) gross payroll shall be the same as the total wages, salaries and
other personal service compensation of all the taxpayer's employees,
within and without this state, as defined in subparagraph three of
paragraph (a) of subdivision three of this section, except that general
executive officers shall not be excluded.
(B) total receipts shall be the same as receipts within and without
this state as defined in subparagraph two of paragraph (a) of
subdivision three of this section.
(C) average value of the assets shall be the same as prescribed by
subdivision two of this section without reduction for liabilities.
(3) If the taxable year is less than twelve months, the amount
prescribed by this paragraph shall be reduced by twenty-five percent if
the period for which the taxpayer is subject to tax is more than six
months but not more than nine months and by fifty per centum if the
period for which the taxpayer is subject to tax is not more than six
months. Provided, however, that in determining the amount of gross
payroll and total receipts for purposes of subparagraph one of this
paragraph, where the taxable year is less than twelve months, the amount
of each shall be determined by dividing the amount of each with respect
to the taxable year by the number of months in such taxable year and
multiplying the result by twelve.
(e) Subsidiary capital base. (1) The amount prescribed by this
paragraph shall be computed at the rate of nine-tenths of a mill for
each dollar of the portion of the taxpayer's subsidiary capital
allocated within the state as hereinafter provided.
(2) For purposes of this paragraph, the amount of such subsidiary
capital, prior to allocation, shall be reduced by the applicable
percentage of the taxpayer's (i) investments in the stock of, and any
indebtedness from, subsidiaries subject to tax under section one hundred
eighty-six of this chapter (but only to the extent such indebtedness is
included in subsidiary capital), and (ii) investments in the stock of,
and any indebtedness from, subsidiaries subject to tax under article
thirty-two or thirty-three of this chapter (but only to the extent such
indebtedness is included in subsidiary capital). For purposes of clause
(i) of this subparagraph, the applicable percentage shall be thirty
percent for taxable years beginning in two thousand, and one hundred
percent for taxable years beginning after two thousand. For purposes of
clause (ii) of this subparagraph, the applicable percentage shall be one
hundred percent for taxable years beginning after nineteen hundred
ninety-nine.
(f) For purposes of this section, the term "small business taxpayer"
shall mean a taxpayer (i) which has an entire net income of not more
than three hundred ninety thousand dollars for the taxable year; (ii)
which constitutes a small business as defined in section 1244(c)(3) of
internal revenue code (without regard to the second sentence of
subparagraph (A) thereof) as of the last day of the taxable year; and
(iii) which is not part of an affiliated group, as defined in section
1504 of the internal revenue code, unless such group, if it had filed a
report under this article on a combined basis, would have itself
qualified as a "small business taxpayer" pursuant to this subdivision.
If the taxable period to which subparagraph (i) of this paragraph
applies is less than twelve months, entire net income under such
subparagraph shall be placed on an annual basis by multiplying the
entire net income by twelve and dividing the result by the number of
months in the period.
(g) New York S corporations. (1) General. The amount prescribed by
this paragraph shall be, in the case of each New York S corporation, (i)
the higher of the amounts prescribed in paragraphs (a) and (d) of this
subdivision (other than the amount prescribed in the final clause of
subparagraph one of such paragraph (d)) (ii) reduced by the article
twenty-two tax equivalent; provided, however, that the amount thus
determined shall not be less than the lowest of the amounts prescribed
in subparagraph one of such paragraph (d) (with regard to the provisions
of subparagraph three of such paragraph). Provided, however,
notwithstanding any provision of this paragraph, in taxable years
beginning in two thousand three and thereafter, the amount prescribed by
this paragraph shall be the amount prescribed in subparagraph one of
such paragraph (d) (with regard to the provisions of subparagraph three
of such paragraph) and with regard to calculation of such amount in the
case of a termination year as set forth in subparagraph four of this
paragraph.
(2) Article twenty-two tax equivalent. For taxable years beginning
before July first, nineteen hundred ninety-nine, the article twenty-two
tax equivalent is the amount computed under paragraph (a) of this
subdivision by substituting for the rate therein the rate of 7.875
percent. For taxable years beginning after June thirtieth, nineteen
hundred ninety-nine and before July first, two thousand, the article
twenty-two tax equivalent is the amount computed under paragraph (a) of
this subdivision by substituting for the rate therein the rate of 7.525
percent. For taxable years beginning after June thirtieth, two thousand
and before July first, two thousand one, the article twenty-two tax
equivalent is the amount computed under paragraph (a) of this
subdivision by substituting for the rate therein the rate of 7.175
percent. For taxable years beginning after June thirtieth, two thousand
one and before July first, two thousand three, the article twenty-two
tax equivalent is the amount computed under paragraph (a) of this
subdivision by substituting for the rate therein the rate of 6.85
percent. For taxable years beginning after June thirtieth, two thousand
three, the article twenty-two tax equivalent is the amount computed
under paragraph (a) of this subdivision by substituting for the rate
therein the rate of 7.1425 percent.
(3) Small business taxpayers. Notwithstanding the provisions of
subparagraphs one and two of this paragraph, in the case of a New York S
corporation which is a small business taxpayer, as defined in paragraph
(f) of this subdivision, the following provisions shall apply:
(A) For taxable years beginning before July first, nineteen hundred
ninety-nine, the article twenty-two tax equivalent is the amount
computed under paragraph (a) of this subdivision by substituting for the
rate therein the rate of 7.875 percent.
(B) For taxable years beginning after June thirtieth, nineteen hundred
ninety-nine and before July first, two thousand three, the amount
computed under paragraph (a) of this subdivision, as referred to in
subparagraph one of this paragraph, shall be computed by substituting
for the rate therein the rate of 7.5 percent, and the article twenty-two
tax equivalent under paragraph (a) of this subdivision shall be computed
as follows:
(i) if the entire net income base is not more than two hundred
thousand dollars, the article twenty-two tax equivalent is the amount
computed under paragraph (a) of this subdivision by substituting for the
rate therein the rate of 7.45 percent;
(ii) if the entire net income base is more than two hundred thousand
dollars but not over two hundred ninety thousand dollars, the article
twenty-two tax equivalent shall be computed as the sum of
(I) fourteen thousand nine hundred dollars,
(II) six and eighty-five hundredths percent of the first fifty
thousand dollars in excess of the entire net income base over two
hundred thousand dollars, and
(III) three and eighty-five hundredths percent of the excess, if any,
of the entire net income base over two hundred fifty thousand dollars.
(C) For taxable years beginning after June thirtieth, two thousand
three, the amount computed under paragraph (a) of this subdivision, as
referred to in subparagraph one of this paragraph, shall be computed by
substituting for the rate therein the rate of 7.5 percent, and the
article twenty-two tax equivalent under paragraph (a) of this
subdivision shall be computed as follows:
(i) if the entire net income base is not more than two hundred
thousand dollars, the article twenty-two tax equivalent is the amount
computed under paragraph (a) of this subdivision by substituting for the
rate therein the rate of 7.4725 percent;
(ii) if the entire net income base is more than two hundred thousand
dollars but not over two hundred ninety thousand dollars, the article
twenty-two tax equivalent shall be computed as the sum of (I) fourteen
thousand nine hundred forty-five dollars, (II) 7.1425 percent of the
first fifty thousand dollars in excess of the entire net income base
over two hundred thousand dollars, and (III) 5.4925 percent of the
excess, if any, of the entire net income base over two hundred fifty
thousand dollars.
(4) Termination year. In the case of a termination year, the tax for
the S short year shall be computed under this paragraph without regard
to the fixed dollar minimum tax prescribed in paragraph (d) of this
subdivision, and the tax for the C short year shall be computed under
the opening paragraph of this subdivision without regard to the fixed
dollar minimum tax prescribed under such paragraph (d), but in no event
shall the sum of the tax for the S short year and the tax for the C
short year be less than the fixed dollar minimum tax under paragraph (d)
of this subdivision computed as if the corporation were a New York C
corporation for the entire taxable year.
* 1-a. Notwithstanding any other provision of this chapter, for
taxable years beginning before January first, nineteen hundred
seventy-eight, an additional tax computed at the rate of five and
three-quarters per centum on business income, or the portion thereof
allocated within the state as hereinafter provided, is hereby imposed on
every corporation subject to the tax imposed by this article which has
gross receipts of five hundred thousand dollars or more for the taxable
year from transportation, within this state, by omnibuses having a
seating capacity of more than seven persons, other than receipts for the
operation of school buses which are excluded from entire net income.
* NB Repealed for taxable years beginning after December 31, 1986
* 1-b. The computation specified in clause three of paragraph (a) of
subdivision one shall not apply to a corporation organized under article
fifteen or authorized to do business in this state under article
fifteen-a of the business corporation law.
* NB Repealed for taxable years beginning after December 31, 1986
1-c. * The computations specified in clause two of paragraph (a) of
subdivision one of this section shall not apply to the first two taxable
years of a taxpayer which, for one or both such years, is a small
business concern. A small business concern:
* NB Applies to taxable years prior to December 31, 1986
* The computations specified in paragraph (b) of subdivision one of
this section shall not apply to the first two taxable years of a
taxpayer which, for one or both such years, is a small business concern.
A small business concern:
* NB Applies to taxable years beginning after December 31, 1986
* (a) is a taxpayer which is a small business corporation as defined
in paragraph three of subsection (c) of section twelve hundred
forty-four of the internal revenue code,
* NB Applies to taxable years prior to December 31, 1986
* (a) is a taxpayer which is a small business corporation as defined
in paragraph three of subsection (c) of section twelve hundred
forty-four of the internal revenue code (without regard to the second
sentence of subparagraph (A) thereof) as of the last day of the taxable
year,
* NB Applies to taxable years beginning after December 31, 1986
(b) is not a corporation over fifty percent of the number of shares of
stock of which entitling the holders thereof to vote for the election of
directors or trustees is owned by a taxpayer which (1) is subject to tax
under this article; section one hundred eighty-three, one hundred
eighty-four or one hundred eighty-five of article nine; article
thirty-two or thirty-three of this chapter, and (2) does not qualify as
a small business corporation as defined in paragraph three of subsection
(c) of section twelve hundred forty-four of the internal revenue code
(without regard to the second sentence of subparagraph (A) thereof) as
of the last day of its taxable year ending within or with the taxable
year of the taxpayer,
(c) is not a corporation which is substantially similar in operation
and in ownership to a business entity (or entities) taxable, or
previously taxable, under this article; section one hundred
eighty-three, one hundred eighty-four, one hundred eighty-five or one
hundred eighty-six of article nine; article thirty-two or thirty-three
of this chapter; article twenty-three of this chapter or which would
have been subject to tax under such article twenty-three (as such
article was in effect on January first, nineteen hundred eighty) or the
income (or losses) of which is (or was) includable under article
twenty-two of this chapter, and
(d) at least ninety percent of the assets of such corporation (valued
at original cost) were located and employed in this state during the
taxable year and eighty percent of the employees of such corporation (as
ascertained within the meaning and intent of subparagraph three of
paragraph (a) of subdivision three of this section) were principally
employed in this state during the taxable year.
* 2. The amount of subsidiary capital, investment capital and business
capital shall each be determined by taking the average fair market value
of the gross assets included therein (less, in the case of business
capital, average liabilities deductible therefrom which are payable by
their terms on demand or within one year from the date incurred, other
than loans or advances outstanding for more than a year as of any date
during the year covered by the report, and, if the period covered by the
report is other than a period of twelve calendar months, by multiplying
such value by the number of calendar months or major parts thereof
included in such period, and dividing the product thus obtained by
twelve.
* NB Applies to taxable years prior to December 31, 1986
* 2. The amount of subsidiary capital, investment capital and business
capital shall each be determined by taking the average value of the
assets included therein (less liabilities deductible therefrom pursuant
to the provisions of subdivisions four, five and seven of section two
hundred eight), and, if the period covered by the report is other than a
period of twelve calendar months, by multiplying such value by the
number of calendar months or major parts thereof included in such
period, and dividing the product thus obtained by twelve. For purposes
of this subdivision, real property and marketable securities shall be
valued at fair market value and the value of personal property other
than marketable securities shall be the value thereof shown on the books
and records of the taxpayer in accordance with generally accepted
accounting principles.
* NB Applies to taxable years beginning after December 31, 1986
3. The portion of the entire net income of a taxpayer to be allocated
within the state shall be determined as follows:
(a) multiply its business income by a business allocation percentage
to be determined by
* (1) ascertaining the percentage which the average value of the
taxpayer's real and tangible personal property within the state during
the period covered by its report bears to the average value of all the
taxpayer's real and tangible personal property wherever situated during
such period;
* NB Applies to taxable years prior to December 31, 1986
* (1) ascertaining the percentage which the average value of the
taxpayer's real and tangible personal property, whether owned or rented
to it, within the state during the period covered by its report bears to
the average value of all the taxpayer's real and tangible personal
property, whether owned or rented to it, wherever situated during such
period. For the purpose of this subparagraph the term "value of the
taxpayer's real and tangible personal property" shall mean the adjusted
bases of such properties for federal income tax purposes (except that in
the case of rented property such value shall mean the product of (i)
eight and (ii) the gross rents payable for the rental of such property
during the taxable year); provided, however, that the taxpayer may make
a one-time, revocable election, pursuant to regulations promulgated by
the commissioner to use fair market value as the value of all of its
real and tangible personal property, provided that such election is made
on or before the due date for filing a report under section two hundred
eleven for the taxpayer's first taxable year commencing on or after
January first, nineteen hundred eighty-seven and provided that such
election shall not apply to any taxable year with respect to which the
taxpayer is included on a combined report unless each of the taxpayers
included on such report has made such an election which remains in
effect for such year;
* NB Applies to taxable years beginning after December 31, 1986
(2) ascertaining the percentage which the receipts of the taxpayer,
computed on the cash or accrual basis according to the method of
accounting used in the computation of its entire net income, arising
during such period from
(A) sales of its tangible personal property where shipments are made
to points within this state,
(B) services performed within the state, provided, however, that (i)
in the case of a taxpayer engaged in the business of publishing
newspapers or periodicals, receipts arising from sales of advertising
contained in such newspapers and periodicals shall be deemed to arise
from services performed within the state to the extent that such
newspapers and periodicals are delivered to points within the state,
(ii) receipts from an investment company arising from the sale of
management, administration or distribution services to such investment
company shall be deemed to arise from services performed within the
state to the extent set forth in subparagraph six of this paragraph,
(iii) in the case of taxpayers principally engaged in the activity of
air freight forwarding acting as principal and like indirect air
carriage receipts arising from such activity shall arise from services
performed within the state as follows: one hundred percent of such
receipts if both the pickup and delivery associated with such receipts
are made in this state and fifty percent of such receipts if either the
pickup or delivery associated with such receipts is made in this state
and (iv) in the case of a taxpayer which is a registered securities or
commodities broker or dealer, the receipts specified in subparagraph
nine of this paragraph shall be deemed to arise from services performed
within the state to the extent set forth in such subparagraph nine, and
(iv) in the case of receipts arising from the transportation or
transmission of gas through pipes, the portion of such receipts which
constitute receipts from services performed within the state shall be
the product of (I) the total of such receipts and (II) a fraction, the
numerator of which is the taxpayer's transportation units within the
state and the denominator of which is the taxpayer's transportation
units within and without the state. A transportation unit is the
transportation of one cubic foot of gas over a distance of one mile,
(C) rentals from property situated, and royalties from the use of
patents or copyrights, within the state, and receipts from the sales of
rights for closed-circuit and cable television transmissions of an event
(other than events occurring on a regularly scheduled basis) taking
place within the state as a result of the rendition of services by
employees of the corporation, as athletes, entertainers or performing
artists, but only to the extent that such receipts are attributable to
such transmissions received or exhibited within the state and
(D) all other business receipts earned within the state, bear to the
total amount of the taxpayer's receipts, similarly computed, arising
during such period from all sales of its tangible personal property,
services, rentals, royalties, receipts from the sales of rights for
closed-circuit and cable television transmissions and all other business
transactions, whether within or without the state;
(3) ascertaining the percentage of the total wages, salaries and other
personal service compensation, similarly computed, during such period of
employees within the state, except general executive officers, to the
total wages, salaries and other personal service compensation, similarly
computed, during such period of all the taxpayer's employees within and
without the state, except general executive officers; and
* (4) adding together the percentages so determined and dividing the
result by the number of percentages; provided, however, for taxable
years beginning on or after the first day of January, nineteen hundred
seventy-six, the business allocation percentage shall be determined by
adding the percentages so determined and an additional percentage equal
to the percentage determined under subparagraph two of this paragraph
together, and dividing the result by the number of percentages so added
together; provided, however, that for taxable years beginning before
January first, nineteen hundred seventy-eight, if the taxpayer does not
have a regular place of business outside the state other than a
statutory office, the business allocation percentage shall be one
hundred percent;
* NB Applies to taxable years prior to December 31, 1986
(4) adding together the percentages so determined and dividing the
result by the number of percentages; provided, however, except (i) in
the case of a New York S corporation, (ii) for purposes of computing
minimum taxable income for taxable years beginning before nineteen
hundred ninety-four, and (iii) for purposes of computing pre-nineteen
hundred ninety minimum taxable income, for taxable years beginning on or
after the first day of January, nineteen hundred seventy-six, the
business allocation percentage shall be determined by adding the
percentages so determined and an additional percentage equal to the
percentage determined under subparagraph two of this paragraph together,
and dividing the result by the number of percentages so added together;
provided, however, that for taxable years beginning before January
first, nineteen hundred seventy-eight, if the taxpayer does not have a
regular place of business outside the state other than a statutory
office, the business allocation percentage shall be one hundred percent;
(5) Provided, however, that any taxpayer required to adjust its
receipts, expenses, assets and liabilities by adding an attributable
portion of the receipts, expenses, assets and liabilities of any DISC,
as provided by paragraph (i) of subdivision nine of section two hundred
eight of this article, shall substitute such adjusted figures in
computing the percentages required in subparagraphs one, two and three
of this paragraph.
(6) Rules for receipts from certain services to investment companies.
(A) For purposes of subclause (ii) of clause (B) of subparagraph two of
this paragraph, the portion of receipts received from an investment
company arising from the sale of management, administration or
distribution services to such investment company determined in
accordance with clause (B) of this subparagraph shall be deemed to arise
from services performed within the state (such portion referred to
herein as the New York portion).
(B) The New York portion shall be the product of (a) the total of such
receipts from the sale of such services and (b) a fraction. The
numerator of that fraction is the sum of the monthly percentages (as
defined hereinafter) determined for each month of the investment
company's taxable year for federal income tax purposes which taxable
year ends within the taxable year of the taxpayer (but excluding any
month during which the investment company had no outstanding shares).
The monthly percentage for each such month is determined by dividing (a)
the number of shares in the investment company which are owned on the
last day of the month by shareholders which are domiciled in the state
by (b) the total number of shares in the investment company outstanding
on that date. The denominator of the fraction is the number of such
monthly percentages.
(C) (i) For purposes of this subparagraph, the term "domicile", in the
case of an individual, shall have the meaning ascribed to it under
article twenty-two of this chapter; an estate or trust is domiciled in
the state if it is a resident estate or trust as defined in paragraph
three of subsection (b) of section six hundred five of this chapter; a
business entity is domiciled in the state if the location of the actual
seat of management or control is in the state. It shall be presumed that
the domicile of a shareholder, with respect to any month, is his, her or
its mailing address on the records of the investment company as of the
last day of such month.
(ii) For purposes of this subparagraph, the term "investment company"
means a regulated investment company, as defined in section 851 of the
internal revenue code, and a partnership to which section 7704(a) of the
internal revenue code applies (by virtue of section 7704(c)(3) of such
code) and that meets the requirements of section 851(b) of such code.
The preceding sentence shall be applied to the taxable year for federal
income tax purposes of the business entity that is asserted to
constitute an investment company that ends within the taxable year of
the taxpayer.
(iii) For purposes of this subparagraph, the term "receipts from an
investment company" includes amounts received directly from an
investment company as well as amounts received from the shareholders in
such investment company, in their capacity as such.
(iv) For purposes of this subparagraph, the term "management services"
means the rendering of investment advice to an investment company,
making determinations as to when sales and purchases of securities are
to be made on behalf of an investment company, or the selling or
purchasing of securities constituting assets of an investment company,
and related activities, but only where such activity or activities are
performed pursuant to a contract with the investment company entered
into pursuant to section 15(a) of the federal investment company act of
nineteen hundred forty, as amended.
(v) For purposes of this subparagraph, the term "distribution
services" means the services of advertising, servicing investor accounts
(including redemptions), marketing shares or selling shares of an
investment company, but, in the case of advertising, servicing investor
accounts (including redemptions) or marketing shares, only where such
service is performed by a person who is (or was, in the case of a closed
end company) also engaged in the service of selling such shares. In the
case of an open end company, such service of selling shares must be
performed pursuant to a contract entered into pursuant to section 15(b)
of the federal investment company act of nineteen hundred forty, as
amended.
(vi) For purposes of this subparagraph, the term "administration
services" includes (1) clerical, accounting, bookkeeping, data
processing, internal auditing, legal and tax services performed for an
investment company but only (2) if the provider of such service or
services during the taxable year in which such service or services are
sold also sells management or distribution services, as defined
hereinabove, to such investment company.
(7) * (A) Provided, further, however, that a taxpayer principally
engaged in the conduct of aviation (other than air freight forwarders
acting as principal and like indirect air carriers and other than as
provided in clause (D) of this subparagraph) shall, notwithstanding the
foregoing provisions of this paragraph, determine the portion of entire
net income to be allocated within the state by multiplying its business
income by a business allocation percentage which is equal to the
arithmetic average of the following three percentages:
(i) the percentage determined by dividing sixty percent of the
aircraft arrivals and departures within this state by the taxpayer
during the period covered by its report by the total aircraft arrivals
and departures within and without this state during such period;
provided, however, arrivals and departures solely for maintenance or
repair, refueling (where no debarkation or embarkation of traffic
occurs), arrivals and departures of ferry and personnel training flights
or arrivals and departures in the event of emergency situations shall
not be included in computing such arrival and departure percentage;
provided, further, the commissioner may also exempt from such percentage
aircraft arrivals and departures of all non-revenue flights including
flights involving the transportation of officers or employees receiving
air transportation to perform maintenance or repair services or where
such officers or employees are transported in conjunction with an
emergency situation or the investigation of an air disaster (other than
on a scheduled flight); provided, however, that arrivals and departures
of flights transporting officers and employees receiving air
transportation for purposes other than specified above (without regard
to remuneration) shall be included in computing such arrival and
departure percentage;
(ii) the percentage determined by dividing sixty percent of the
revenue tons handled by the taxpayer at airports within this state
during such period by the total revenue tons handled by it at airports
within and without this state during such period; and
(iii) the percentage determined by dividing sixty percent of the
taxpayer's originating revenue within this state for such period by its
total originating revenue within and without this state for such period.
* NB Applies to taxable years beginning on or after January 1, 2001
(B) As used herein the term "aircraft arrivals and departures" means
the number of landings and takeoffs of the aircraft of the taxpayer and
the number of air pickups and deliveries by the aircraft of such
taxpayer; the term "originating revenue" means revenue to the taxpayer
from the transportation of revenue passengers and revenue property first
received by the taxpayer either as originating or connecting traffic at
airports; and the term "revenue tons handled" by the taxpayer at
airports means the weight in tons of revenue passengers (at two hundred
pounds per passenger) and revenue cargo first received either as
originating or connecting traffic or finally discharged by the taxpayer
at airports;
(C) Taxpayers principally engaged as air freight forwarders acting as
principal and like indirect air carriers shall allocate business income
in accordance with subparagraphs (1) through (4) of this paragraph,
including the special provision relating to the allocation of receipts
from the activity of air freight forwarding acting as principal
contained in clause (B) of subparagraph (2) of this paragraph.
(D) A foreign air carrier described in the first sentence of
subparagraph one of paragraph (c-1) of subdivision nine of section two
hundred eight of this article shall determine its business allocation
percentage pursuant to the provisions of subparagraphs one through four
of this paragraph, except that the numerators and denominators involved
in such computation shall exclude property to the extent employed in
generating income excluded from entire net income pursuant to the
provisions of paragraph (c-1) of subdivision nine of section two hundred
eight of this article, exclude such receipts as are excluded from entire
net income for the taxable year pursuant to the provisions of paragraph
(c-1) of subdivision nine of section two hundred eight of this article,
and exclude wages, salaries or other personal service compensation which
are directly attributable to the generation of income excluded from
entire net income for the taxable year pursuant to the provisions of
paragraph (c-1) of subdivision nine of section two hundred eight of this
article.
* (8) Provided, further, however that the business allocation
percentage of a taxpayer principally engaged in the conduct of a
railroad business (including surface railroad, whether or not operated
by steam, subway railroad, elevated railroad, palace car or sleeping car
business) or a trucking business, shall, notwithstanding the foregoing
provisions of this paragraph, be computed by dividing the taxpayer's
mileage within this state during the period covered by its report by the
taxpayer's mileage within and without this state during such period.
* NB Applies to tax years commencing on or after January 1, 1998
(9)(A) In the case of a taxpayer which is a registered securities or
commodities broker or dealer, the receipts specified in subclauses (i)
through (vii) of this clause shall be deemed to arise from services
performed within the state to the extent set forth in each of such
subclauses.
(i) Receipts constituting brokerage commissions derived from the
execution of securities or commodities purchase or sales orders for the
accounts of customers shall be deemed to arise from services performed
at the mailing address in the records of the taxpayer of the customer
who is responsible for paying such commissions.
(ii) Receipts constituting margin interest earned on behalf of
brokerage accounts shall be deemed to arise from services performed at
the mailing address in the records of the taxpayer of the customer who
is responsible for paying such margin interest.
(iii) Gross income, including any accrued interest or dividends, from
principal transactions for the purchase or sale of stocks, bonds,
foreign exchange and other securities or commodities (including futures
and forward contracts, options and other types of securities or
commodities derivatives contracts) shall be deemed to arise from
services performed within the state either (I) to the extent that
production credits are awarded to branches, offices or employees of the
taxpayer within the state as a result of such principal transactions or
(II) if the taxpayer so elects, to the extent that the gross proceeds
from such principal transactions (determined without deduction for any
cost incurred by the taxpayer to acquire the securities or commodities)
are generated from sales of securities or commodities to customers
within the state based upon the mailing addresses of such customers in
the records of the taxpayer. For purposes of item (II) of the preceding
sentence, the taxpayer shall separately calculate such gross income from
principal transactions by type of security or commodity. For purposes of
this subclause, gross income from principal transactions shall be
determined after the deduction of any cost incurred by the taxpayer to
acquire the securities or commodities. For purposes of this
subparagraph, the term "production credits" means credits granted
pursuant to the internal accounting system used by the taxpayer to
measure the amount of revenue that should be awarded to a particular
branch or office or employee of the taxpayer which is based, at least in
part, on the branch's, the office's or the employee's particular
activities. Upon request, the taxpayer shall be required to furnish a
detailed explanation of such internal accounting system to the
department.
(iv) (I) Receipts constituting fees earned by the taxpayer for
advisory services to a customer in connection with the underwriting of
securities for such customer (such customer being the entity which is
contemplating issuing or is issuing securities) or fees earned by the
taxpayer for managing an underwriting shall be deemed to arise from
services performed at the mailing address in the records of the taxpayer
of such customer who is responsible for paying such fees. (II) Receipts
constituting the primary spread or selling concession from underwritten
securities shall be deemed to arise from services performed within the
state to the extent that production credits are awarded to branches,
offices or employees of the taxpayer within the state as a result of the
sale of the underwritten securities. (III) The term "primary spread"
means the difference between the price paid by the taxpayer to the
issuer of the securities being marketed and the price received from the
subsequent sale of the underwritten securities at the initial public
offering price, less any selling concession and any fees paid to the
taxpayer for advisory services or any manager's fees, if such fees are
not paid by the customer to the taxpayer separately. The term "public
offering price" means the price agreed upon by the taxpayer and the
issuer at which the securities are to be offered to the public. The term
"selling concession" means the amount paid to the taxpayer for
participating in the underwriting of a security where the taxpayer is
not the lead underwriter. The term "production credits" shall have the
same meaning as in subclause (iii) of this clause.
(v) Receipts constituting interest earned by the taxpayer on loans and
advances made by the taxpayer to a corporation affiliated with the
taxpayer but with which the taxpayer is not permitted or required to
file a combined report pursuant to section two hundred eleven of this
article shall be deemed to arise from services performed at the
principal place of business of such affiliated corporation.
(vi) Receipts constituting account maintenance fees shall be deemed to
arise from services performed at the mailing address in the records of
the taxpayer of the customer who is responsible for paying such account
maintenance fees.
(vii) Receipts constituting fees for management or advisory services,
including fees for advisory services in relation to merger or
acquisition activities but excluding fees paid for services described in
subclause (ii) of clause (B) of subparagraph two of this paragraph,
shall be deemed to arise from services performed at the mailing address
in the records of the taxpayer of the customer who is responsible for
paying such fees.
(B) For purposes of this subparagraph, the term "securities" shall
have the same meaning as in section 475(c)(2) of the internal revenue
code and the term "commodities" shall have the same meaning as in
section 475(e)(2) of the internal revenue code. The term "registered
securities or commodities broker or dealer" means a broker or dealer
registered as such by the securities and exchange commission or the
commodities futures trading commission, and shall include an OTC
derivatives dealer as defined under regulations of the securities and
exchange commission at title 17, part 240, section 3b-12 of the code of
federal regulations (17 CFR 240.3b-12).
(C) If the taxpayer receives any of the receipts enumerated in clause
(A) of this subparagraph as a result of a securities correspondent
relationship such taxpayer has with another registered securities or
commodities broker or dealer with the taxpayer acting in this
relationship as the clearing firm, such receipts shall be deemed to
arise from services performed within the state to the extent set forth
in each of such subclauses. The amount of such receipts shall exclude
the amount the taxpayer is required to pay to the correspondent firm for
such correspondent relationship. If the taxpayer receives any of the
receipts enumerated in clause (A) of this subparagraph as a result of a
securities correspondent relationship such taxpayer has with another
registered securities or commodities broker or dealer with the taxpayer
acting in this relationship as the introducing firm, such receipts shall
be deemed to arise from services performed within the state to the
extent set forth in each of such subclauses.
(D) If, for purposes of subclause (i), (ii), (iv)(I), (vi), or (vii)
of clause (A) of this subparagraph, the taxpayer is unable from its
records to determine the mailing address of the customer, the receipts
enumerated in any of such subclauses shall be deemed to arise from
services performed at the branch or office of the taxpayer that
generates the transaction for the customer that generated such receipts.
(10) (A) Notwithstanding the foregoing provisions of this paragraph,
other than subparagraphs seven and eight of this paragraph, the business
allocation percentage shall be computed in the manner set forth in this
subparagraph.
(i) For taxable years beginning on or after January first, two
thousand six and before January first, two thousand seven, the business
allocation percentage shall be determined by adding together the
following percentages:
(I) the product of twenty percent and the percentage determined under
subparagraph one of this paragraph,
(II) the product of sixty percent and the percentage determined under
subparagraph two of this paragraph, and
(III) the product of twenty percent and the percentage determined
under subparagraph three of this paragraph.
(ii) For taxable years beginning on or after January first, two
thousand seven and before January first, two thousand eight, the
allocation percentage shall be determined by adding together the
following percentages:
(I) the product of ten percent and the percentage determined under
subparagraph one of this paragraph,
(II) the product of eighty percent and the percentage determined under
subparagraph two of this paragraph, and
(III) the product of ten percent and the percentage determined under
subparagraph three of this paragraph.
(iii) For taxable years beginning on or after January first, two
thousand eight the business allocation percentage shall be the
percentage provided for in subparagraph two of this paragraph.
(b) multiplying its investment income by an investment allocation
percentage to be determined by
* (1) multiplying the amount of its investment capital invested in
each stock, bond or other security (other than governmental securities)
during the period covered by its report by the percentage, if any, of
the entire capital or the issued capital stock, or the gross direct
premiums, or the net income, as the case may be, of the issuer or
obligor thereof required to be allocated within the state on the report
or reports, if any, required of any such issuer or obligor under this
chapter or the insurance law for the preceding year, but without regard
to any minimum,
* NB Applies to taxable years prior to December 31, 1986
* (1) multiplying the amount of its investment capital invested in
each stock, bond or other security (other than governmental securities)
during the period covered by its report by the issuer's allocation
percentage of the issuer or obligor thereof.
(i) In the case of an issuer or obligor subject to tax under section
one hundred eighty-three, one hundred eighty-five or one hundred
eighty-six of this chapter or under this article or article thirty-three
of this chapter (except for savings and insurance banks described in
subdivision (b) of section fifteen hundred of this chapter), the
issuer's allocation percentage shall be the percentage of the
appropriate measure (as defined hereinafter) which is required to be
allocated within the state on the report, if any, required of the issuer
or obligor under this chapter for the preceding year. The appropriate
measure referred to in the preceding sentence shall be: in the case of
an issuer or obligor subject to section one hundred eighty-three of this
chapter, issued capital stock; in the case of an issuer or obligor
subject to section one hundred eighty-five of this chapter, issued
capital stock; in the case of an issuer or obligor subject to section
one hundred eighty-six of this chapter, gross earnings; in the case of
an issuer or obligor subject to this article, entire capital; and in the
case of an issuer or obligor subject to article thirty-three of this
chapter, gross direct premiums.
(ii) In the case of an issuer or obligor subject to tax under article
thirty-two of this chapter, the issuer's allocation percentage shall be
determined as follows:
(A) In the case of a banking corporation described in paragraphs one
through eight of subsection (a) of section fourteen hundred fifty-two of
this chapter which is organized under the laws of the United States,
this state or any other state of the United States, the issuer's
allocation percentage shall be its alternative entire net income
allocation percentage, as defined in subsection (c) of section fourteen
hundred fifty-four of this chapter, for the preceding year. In the case
of such a banking corporation whose alternative entire net income for
the preceding year is derived exclusively from business carried on
within the state, its issuer's allocation percentage shall be one
hundred percent.
(B) In the case of a banking corporation described in paragraph two of
subsection (a) of section fourteen hundred fifty-two of this chapter
which is organized under the laws of a country other than the United
States, the issuer's allocation percentage shall be determined by
dividing (I) the amount described in clause (i) of subparagraph (A) of
paragraph two of subsection (a) of section fourteen hundred fifty-four
of this chapter with respect to such issuer or obligor for the preceding
year, by (II) the gross income of such issuer or obligor from all
sources within and without the United States, for such preceding year,
whether or not included in alternative entire net income for such year.
(C) In the case of an issuer or obligor described in paragraph nine of
subsection (a) or in paragraph two of subsection (d) of section fourteen
hundred fifty-two of this chapter, the issuer's allocation percentage
shall be determined by dividing the portion of the entire capital of the
issuer or obligor allocable to this state for the preceding year by the
entire capital, wherever located, of the issuer or obligor for the
preceding year.
(iii) Provided, however, that if a report for the preceding year is
not filed, or if filed does not contain information which would permit
the determination of such issuer's allocation percentage, then the
issuer's allocation percentage to be used shall, at the discretion of
the commissioner, be either (A) the issuer's allocation percentage
derived from the most recently filed report of the issuer or obligor or
(B) a percentage calculated, by the commissioner, reasonably to indicate
the degree of economic presence in this state of the issuer or obligor
during the preceding year.
* NB Applies to taxable years beginning after December 31, 1986
(2) adding together the sums so obtained, and
* (3) dividing the result so obtained by the total of its investment
capital invested during such period in stocks, bonds and other
securities (other than obligations of the United States and its
instrumentalities and obligations of the state of New York, its
political subdivisions and its instrumentalities); provided, however,
that in case any investment capital is invested in any stock, bond or
other security during only a portion of the period covered by the
report, only such portion of such capital shall be taken into account;
and provided further, that if a taxpayer's investment allocation
percentage is zero, interest received on bank accounts, on obligations
of the United States and its instrumentalities and on obligations of the
state of New York, its political subdivisions and its instrumentalities
shall be multiplied by its business allocation percentage; provided,
however, that with respect to corporations organized under article
fifteen or authorized to do business in this state under article
fifteen-a of the business corporation law, the investment allocation
percentage shall be one hundred percent; and
* NB Applies to taxable years prior to December 31, 1986
* (3) dividing the result so obtained by the total of its investment
capital invested during such period in stocks, bonds and other
securities; provided, however, that in case any investment capital is
invested in any stock, bond or other security during only a portion of
the period covered by the report, only such portion of such capital
shall be taken into account; and provided further, that if a taxpayer's
investment allocation percentage is zero, interest received on bank
accounts shall be multiplied by its business allocation percentage;
provided, however, that with respect to corporations organized under
article fifteen or authorized to do business in this state under article
fifteen-a of the business corporation law, the investment allocation
percentage shall be one hundred percent; and
* NB Applies to taxable years beginning after December 31, 1986
(c) add the products so obtained.
(d) Except as provided in subparagraph three of this paragraph or in
paragraph (e) of this subdivision, at the election of the taxpayer there
shall be deducted from the portion of its entire net income allocated
within the state either or both of the items set forth in subparagraphs
one and two of this paragraph, except that only one of such deductions
shall be allowed with respect to any one item of property.
(1) Depreciation with respect to any property such as described in
subparagraph three of this paragraph, not exceeding twice the
depreciation allowed with respect to the same property for federal
income tax purposes. Such deduction shall be allowed only upon condition
that entire net income be computed without any deduction for the
depreciation or amortization of the same property, and the total of all
deductions allowed in any taxable year or years with respect to the
depreciation of any such property shall not exceed its cost or other
basis.
(2) Expenditures paid or incurred during the taxable year for the
construction, reconstruction, erection or acquisition of any property
such as described in subparagraph three of this paragraph which is used
or to be used for purposes of research and development in the
experimental or laboratory sense. Such purposes shall not be deemed to
include the ordinary testing or inspection of materials or products for
quality control, efficiency surveys, management studies, consumer
surveys, advertising, promotions or research in connection with
literary, historical or similar projects. Such deduction shall be
allowed only on condition that entire net income for the taxable year
and all succeeding taxable years be computed without the deduction of
any such expenditures and without any deduction for depreciation of the
same property, except to the extent that its basis may be attributable
to factors other than such expenditures, or in case a deduction is
allowable pursuant to this subparagraph for only a part of such
expenditures, on condition that any deduction allowed for federal income
tax purposes on account of such expenditures or on account of
depreciation of the same property be proportionately reduced in
computing entire net income for the taxable year and all succeeding
taxable years. With respect to property which is used or to be used for
research and development only in part, or during only part of its useful
life, a proportionate part of such expenditures shall be deductible. If
all or part of such expenditures with respect to any property shall have
been deducted as provided herein, and such property is used for purposes
other than research and development to a greater extent than originally
reported, the taxpayer shall report such use in its report for the first
taxable year during which it occurs, and the tax commission may
recompute the tax for the year or years for which such deduction was
allowed, and may assess any additional tax resulting from such
recomputation regardless of the time limitations set forth in section
ten hundred eighty-three of this chapter.
(3) Such deductions shall be allowed only with respect to tangible
property which is depreciable pursuant to section one hundred
sixty-seven of the internal revenue code, having a situs in this state
and used in the taxpayer's trade or business, (A) constructed,
reconstructed or erected after December thirty-first, nineteen hundred
sixty-three, pursuant to a contract which was, on or before December
thirty-first, nineteen hundred sixty-seven, and at all times thereafter,
binding on the taxpayer or, property, the physical construction,
reconstruction or erection of which began on or before December
thirty-first, nineteen hundred sixty-seven or which began after such
date pursuant to an order placed on or before December thirty-first,
nineteen hundred sixty-seven, and then only with respect to that portion
of the basis thereof or the expenditures relating thereto which is
properly attributable to such construction, reconstruction or erection
after December thirty-first, nineteen hundred sixty-three, or (B)
acquired after December thirty-first, nineteen hundred sixty-three,
pursuant to a contract which was, on or before December thirty-first,
nineteen hundred sixty-seven, and at all times thereafter, binding on
the taxpayer or pursuant to an order placed on or before December
thirty-first, nineteen hundred sixty-seven, by purchase as defined in
section one hundred seventy-nine (d) of the internal revenue code, if
the original use of such property commenced with the taxpayer, commenced
in this state and commenced after December thirty-first nineteen hundred
sixty-three, or (C) acquired, constructed, reconstructed, or erected
subsequent to December thirty-first, nineteen hundred sixty-seven, if
such acquisition, construction, reconstruction or erection is pursuant
to a plan of the taxpayer which was in existence December thirty-first,
nineteen hundred sixty-seven and not thereafter substantially modified,
and such acquisition, construction, reconstruction or erection would
qualify under the rules in paragraphs four, five or six of subsection
(h) of section forty-eight of the internal revenue code provided all
references in such paragraphs four, five and six to the dates October
nine, nineteen hundred sixty-six, and October ten, nineteen hundred
sixty-six, shall be read as December thirty-first, nineteen hundred
sixty-seven. A taxpayer shall be allowed a deduction under clauses (A),
(B) or (C) of this subparagraph only if the tangible property shall be
delivered or the construction, reconstruction or erection shall be
completed on or before December thirty-first, nineteen hundred
sixty-nine, except in the case of tangible property which is acquired,
constructed, reconstructed or erected pursuant to a contract which was,
on or before December thirty-first, nineteen hundred sixty-seven, and at
all times thereafter, binding on the taxpayer. Provided, however, for
any taxable year beginning on or after January first, nineteen hundred
sixty-eight, a taxpayer shall not be allowed a deduction under paragraph
(d) hereof with respect to tangible personal property leased by it to
any other person or corporation. For purposes of the preceding sentence,
any contract or agreement to lease or rent or for a license to use such
property shall be considered a lease. With respect to property which the
taxpayer uses itself for purposes other than leasing for part of a
taxable year and leases for a part of a taxable year, the taxpayer shall
be allowed a deduction under paragraph (d) in proportion to the part of
the year it uses such property.
(4) If the deductions allowable for any taxable year, pursuant to this
subdivision, exceed the portion of the taxpayer's entire net income
allocated to this state for such year, the excess may be carried over to
the following taxable year or years and may be deducted from the portion
of the taxpayer's entire net income allocated to this state for such
year or years; provided, however, that in no event shall such excess,
insofar as it reflects deductions taken with respect to items set forth
in subparagraph two of this paragraph, be carried over to taxable years
commencing on or after January first, nineteen hundred ninety-four.
(5) In any taxable year when property is sold or otherwise disposed
of, with respect to which a deduction has been allowed pursuant to
subparagraph one or two of this paragraph, the gain or loss thereon
entering into the computation of federal taxable income shall be
disregarded in computing entire net income, and there shall be added to
or subtracted from the portion of entire net income allocated within the
state the gain or loss upon such sale or other disposition. In computing
such gain or loss the basis of the property sold or disposed of shall be
adjusted to reflect the deduction allowed with respect to such property
pursuant to subparagraph one or two of this paragraph. Provided,
however, that no loss shall be recognized for the purposes of this
subparagraph with respect to a sale or other disposition of property to
a person whose acquisition thereof is not a purchase as defined in
section one hundred seventy-nine (d) of the internal revenue code.
(e) At the election of the taxpayer there shall be deducted from the
portion of its entire net income allocated within the state either or
both of the items set forth in subparagraphs one and two of this
paragraph, except that only one of such deductions shall be allowed with
respect to any one item of property, and except that a deduction of the
item set forth in such subparagraph two may not be taken with respect to
taxable years commencing on or after January first, nineteen hundred
eighty-seven.
(1) Depreciation with respect to any property such as described in
subparagraphs three and four of this paragraph, not exceeding twice the
depreciation allowed with respect to the same property for federal
income tax purposes. Such deduction shall be allowed only upon condition
that entire net income be computed without any deduction for the
depreciation or amortization of the same property, and the total of all
deductions allowed in any taxable year or years with respect to the
depreciation of any such property shall not exceed its cost or other
basis multiplied by the taxpayer's business allocation percentage
determined under this subdivision for the first year it deducts such
depreciation under this paragraph.
(2) Expenditures paid or incurred during the taxable year for the
construction, reconstruction, erection or acquisition of any property
such as described in subparagraph three of this paragraph which is used
or to be used for purposes of research and development in the
experimental or laboratory sense. Such purposes shall not be deemed to
include the ordinary testing or inspection of materials or products for
quality control, efficiency surveys, management studies, consumer
surveys, advertising, promotions or research in connection with
literary, historical or similar projects. Such deduction shall be
allowed only on condition that it does not exceed the amount of the
expenditures multiplied by the taxpayer's business allocation percentage
determined under this subdivision for the year the expenditures are paid
or incurred and that entire net income for the taxable year and all
succeeding taxable years be computed without the deduction of any such
expenditures and without any deduction for depreciation of the same
property, except to the extent that its basis may be attributable to
factors other than such expenditures, or in case a deduction is
allowable pursuant to this subparagraph for only a part of such
expenditures, on condition that any deduction allowed for federal income
tax purposes on account of such expenditures or on account of
depreciation of the same property be proportionately reduced in
computing entire net income for the taxable year and all succeeding
taxable years. With respect to property which is used or to be used for
research and development only in part, or during only part of its useful
life, a proportionate part of such expenditures shall be deductible. If
all or part of such expenditures with respect to any property shall have
been deducted as provided herein, and such property is used for purposes
other than research and development to a greater extent than originally
reported, the taxpayer shall report such use in its report for the first
taxable year during which it occurs, and the tax commission may
recompute the tax for the year or years for which such deduction was
allowed, and may assess any additional tax resulting from such
recomputation regardless of the time limitations set forth in section
ten hundred eighty-three of this chapter.
(3) Such deductions shall be allowed only with respect to tangible
property which is depreciable pursuant to section one hundred
sixty-seven of the internal revenue code, having a situs in this state
and used in the taxpayer's trade or business. The deductions provided
for in subparagraph one of this paragraph shall be allowed only with
respect to tangible property which is (A) constructed, reconstructed or
erected after December thirty-first, nineteen hundred sixty-seven,
pursuant to a contract which was, on or before December thirty-first,
nineteen hundred sixty-eight, and at all times thereafter, binding on
the taxpayer or, property, the physical construction, reconstruction or
erection of which began on or before December thirty-first, nineteen
hundred sixty-eight or which began after such date pursuant to an order
placed on or before December thirty-first, nineteen hundred sixty-eight,
and then only with respect to that portion of the basis thereof or the
expenditures relating thereto which is properly attributable to such
construction, reconstruction or erection after December thirty-first,
ninteen hundred sixty-three or (B) acquired after December thirty-first,
nineteen hundred sixty-seven, pursuant to a contract which was, on or
before December thirty-first, nineteen hundred sixty-eight, and at all
times thereafter, binding on the taxpayer or pursuant to an order placed
on or before December thirty-first, nineteen hundred sixty-eight, by
purchase as defined in section one hundred seventy-nine (d) of the
internal revenue code, if the original use of such property commenced
with the taxpayer, commenced in this state and commenced after December
thirty-first, nineteen hundred sixty-seven, or (C) acquired,
constructed, reconstructed, or erected subsequent to December
thirty-first, nineteen hundred sixty-eight, if such acquisition,
construction, reconstruction or erection is pursuant to a plan of the
taxpayer which was in existence December thirty-first, nineteen hundred
sixty-eight, and not thereafter substantially modified, and such
acquisition, construction, reconstruction or erection would qualify
under the rules in paragraphs four, five or six of subsection (h) of
section forty-eight of the internal revenue code provided all references
in such paragraphs four, five and six to the dates October nine,
nineteen hundred sixty-six, and October ten, nineteen hundred sixty-six,
shall be read as December thirty-first, nineteen hundred sixty-eight. A
taxpayer shall be allowed a deduction under clauses (A), (B) or (C) of
the preceding sentence of this subparagraph only if the tangible
property shall be delivered or the construction, reconstruction or
erection shall be completed on or before December thirty-first, nineteen
hundred seventy, except in the case of tangible property which is
acquired, constructed, reconstructed or erected pursuant to a contract
which was, on or before December thirty-first, nineteen hundred
sixty-eight, and at all times thereafter binding on the taxpayer. The
deduction provided for in subparagraph two of this paragraph shall be
allowed only with respect to tangible property (A) the construction,
reconstruction or erection of which is completed after December
thirty-first, nineteen hundred sixty-seven, and then only with respect
to that portion of the basis thereof or the expenditures relating
thereto which is properly attributable to such construction,
reconstruction or erection after December thirty-first, ninteen hundred
sixty-three, or (B) acquired after December thirty-first, nineteen
hundred sixty-seven by purchase as defined in section one hundred
seventy-nine (d) of the internal revenue code, if the original use of
such property commenced with the taxpayer, commenced in this state and
commenced after December thirty-first, nineteen hundred sixty-three.
Provided, however, for any taxable year beginning on or after January
first, nineteen hundred sixty-eight, a taxpayer shall not be allowed a
deduction under paragraph (e) hereof with respect to tangible personal
property leased by it to any other person or corporation. For purposes
of the preceding sentence, any contract or agreement to lease or rent or
for a license to use such property shall be considered a lease. With
respect to property which the taxpayer uses itself for purposes other
than leasing for part of a taxable year and leases for a part of a
taxable year, the taxpayer shall be allowed a deduction under paragraph
(e) in proportion to the part of the year it uses such property.
(4) A deduction under subparagraph one of this paragraph shall be
allowed with respect to tangible property described in subparagraph
three only if such property is principally used by the taxpayer in the
production of goods by manufacturing; processing; assembling; refining;
mining; extracting; farming; agriculture; horticulture; floriculture;
viticulture; or commercial fishing. For purposes of this subparagraph,
manufacturing shall mean the process of working raw materials into wares
suitable for use or which gives new shapes, new qualities or new
combinations to matter which already has gone through some artificial
process by the use of machinery, tools, appliances and other similar
equipment. Property used in the production of goods shall include
machinery, equipment or other tangible property which is principally
used in the repair and service of other machinery, equipment or other
tangible property used principally in the production of goods and shall
include all facilities used in the manufacturing operation, including
storage of material to be used in manufacturing and of the products that
are manufactured. At the option of the taxpayer, air and water pollution
control facilities which qualify for elective deductions under paragraph
(g) of subdivision nine of section two hundred eight may be treated, for
purposes of this paragraph, as tangible property principally used in the
production of goods by manufacturing; processing; assembling; refining;
mining; extracting; farming; agriculture; horticulture; floriculture;
viticulture; or commercial fishing, in which event, a deduction shall
not be allowed under such paragraph (g).
(5) Subject to the limitation imposed by subparagraphs one and two
hereof, if the deductions allowable for any taxable year, pursuant to
this subdivision, exceed the portion of the taxpayer's entire net income
allocated to this state for such year, the excess may be carried over to
the following taxable year or years and may be deducted from the portion
of the taxpayer's entire net income allocated to this state for such
year or years; provided, however, that in no event shall such excess,
insofar as it reflects deductions taken with respect to items set forth
in subparagraph two of this paragraph, be carried over to taxable years
commencing on or after January first, nineteen hundred ninety-four.
(6) In any taxable year when property is sold or otherwise disposed
of, with respect to which a deduction has been allowed pursuant to
subparagraph one or two of this paragraph, the gain or loss thereon
entering into the computation of federal taxable income shall be
disregarded in computing entire net income, and there shall be added to
or subtracted from the portion of entire net income allocated within the
state the gain or loss upon such sale or other disposition. In computing
such gain or loss the basis of the property sold or disposed of shall be
adjusted to reflect the deduction allowed with respect to such property
pursuant to subparagraph one or two of this paragraph. Provided,
however, that no loss shall be recognized for the purposes of this
subparagraph with respect to a sale or other disposition of property to
a person whose acquisition thereof is not a purchase as defined in
section one hundred seventy-nine (d) of the internal revenue code.
* 3-a. The portion of the minimum taxable income of a taxpayer to be
allocated within the state shall be determined as follows.
(a) Multiply its alternative business income by an alternative
business allocation percentage determined pursuant to the method
prescribed in subdivision three of this section except that for taxable
years beginning before nineteen hundred ninety-four the additional
percentage (referred to in subparagraph four of paragraph (a) of such
subdivision) equal to the percentage determined under subparagraph two
of paragraph (a) of such subdivision shall be disregarded and not added
together with the other percentages, and except that the percentages
employed in such subdivision three shall be modified to reflect the
factors utilized in computing minimum taxable income, provided, however,
that a taxpayer principally engaged in the conduct of aviation (other
than air freight forwarders acting as principal and like indirect air
carriers) shall determine its alternative business allocation percentage
pursuant to the method prescribed in subparagraph seven of paragraph (a)
of subdivision three of this section.
(b) Multiply its alternative investment income by the investment
allocation percentage determined pursuant to the method prescribed in
subdivision three of this section.
(c) Add the products so obtained.
(d) For purposes of this subdivision, subdivision six of this section
shall not apply.
(e) For purposes of this subdivision the following definitions shall
apply:
(i) Alternative business income shall mean minimum taxable income
minus alternative investment income.
(ii) Alternative investment income shall mean the sum of investment
income as defined in subdivision six of section two hundred eight and
that portion of minimum taxable income which consists of income from
investment capital and which is not included in entire net income.
* NB Applies to taxable years beginning after December 31, 1994
4. The portion of the business capital of a taxpayer to be allocated
within the state shall be determined by multiplying the amount thereof
by the business allocation percentage determined as hereinabove
provided. Provided, however, such business allocation percentage, for
purposes of allocating business capital, shall (a) for taxable years
beginning before nineteen hundred ninety-four, be determined without
regard to clause (D) of subparagraph seven of paragraph (a) of
subdivision three of this section and (b) for taxable years beginning
after nineteen hundred ninety-three shall be determined with regard to
such clause (D) but only in the case of a taxpayer subject to the
provisions of paragraph (b) of subdivision seven of section two hundred
eight.
5. The portion of the investment capital of a taxpayer to be allocated
within the state shall be determined by multiplying the amount thereof
by the investment allocation percentage determined as hereinabove
provided.
* 7. The portion of the subsidiary capital of a taxpayer to be
allocated within the state shall be determined by (a) multiplying the
amount of its subsidiary capital invested in each subsidiary during the
period covered by its report (or, in the case of any such capital so
invested during only a portion of such period, such portion of such
capital) by the percentage, if any, of the entire capital or the issued
capital stock, or the gross direct premiums, or the net income, as the
case may be, of such subsidiary required to be allocated within the
state on the report or reports, if any, required of such subsidiary
under this chapter or the insurance law for the preceding year and (b)
adding together the sums so obtained.
* NB Applies to taxable years prior to December 31, 1986
* 7. The portion of the subsidiary capital of a taxpayer to be
allocated within the state shall be determined by (a) multiplying the
amount of its subsidiary capital invested in each subsidiary during the
period covered by its report (or, in the case of any such capital so
invested during only a portion of such period, such portion of such
capital) by the issuer's allocation percentage, as defined in
subparagraph one of paragraph (b) of subdivision three of this section,
of each such subsidiary and (b) adding together the sums so obtained.
* NB Applies to taxable years beginning after December 31, 1986
* 8. If it shall appear to the tax commission that any business or
investment allocation percentage determined as hereinabove provided does
not properly reflect the activity, business, income or capital of a
taxpayer within the state, the tax commission shall be authorized in its
discretion, in the case of a business allocation percentage, to adjust
it by (a) excluding one or more of the factors therein, (b) including
one or more other factors, such as expenses, purchases, contract values
(minus subcontract values), (c) excluding one or more assets in
computing such allocation percentage, provided the income therefrom is
also excluded in determining entire net income, or (d) any other similar
or different method calculated to effect a fair and proper allocation of
the income and capital reasonably attributable to the state, and in the
case of an investment allocation percentage, to adjust it by excluding
one or more assets in computing such percentage provided the income
therefrom is also excluded in determining entire net income.
* NB Applies to taxable years prior to December 31, 1986
* 8. If it shall appear to the tax commission that any business or
investment allocation percentage or alternative business allocation
percentage determined as hereinabove provided does not properly reflect
the activity, business, income or capital of a taxpayer within the
state, the tax commission shall be authorized in its discretion, in the
case of a business allocation percentage or alternative business
allocation percentage, to adjust it by (a) excluding one or more of the
factors therein, (b) including one or more other factors, such as
expenses, purchases, contract values (minus subcontract values), (c)
excluding one or more assets in computing such allocation percentage,
provided the income therefrom is also excluded in determining entire net
income or minimum taxable income, or (d) any other similar or different
method calculated to effect a fair and proper allocation of the income
and capital reasonably attributable to the state, and in the case of an
investment allocation percentage, to adjust it by excluding one or more
assets in computing such percentage provided the income therefrom is
also excluded in determining entire net income or minimum taxable
income.
* NB Applies to taxable years beginning after December 31, 1986
9. The tax commission from time to time shall publish all rulings of
general public interest with respect to any application of the
provisions of subdivision eight of this section.
* 10. For purposes of this section the taxpayer's real property shall
include not only such property owned by the taxpayer but also such
property rented to it.
* NB Repealed for taxable years beginning after December 31, 1986
11. Eligible business facility credit. (a) On or after April first,
nineteen hundred eighty-three, for taxable years beginning before
January first, two thousand, a credit against the tax imposed by this
article shall be allowed only to a taxpayer owning or operating an
eligible business facility where such taxpayer has received a
certificate of eligibility for tax credits, or a renewal or extension
thereof, for such facility from the New York state job incentive board
prior to April first, nineteen hundred eighty-three, or has received a
certificate of eligibility for tax credits, or a renewal or extension
thereof, for such facility from the state tax commission subsequent to
such date pursuant to paragraph (h) of this subdivision, and only with
respect to such facility, to be computed as hereinafter provided.
(b) The amount of the credit allowable in any taxable year shall be
the sum determined by multiplying the tax otherwise due by a percentage
to be determined by:
(1) ascertaining the percentage which the total of eligible property
values during the period covered by its report, as defined in paragraph
(d) of this subdivision, bears to the average value of all the
taxpayer's real and tangible personal property except for inventory
within the state during such period. For the purposes of this
subparagraph only, the taxpayer's real and tangible personal property
shall include not only such property owned by the taxpayer but also
property rented to it, and the value of rented property shall be deemed
to be eight times the net annual rental rate, that is, the annual rental
rate paid by the taxpayer less any annual rental rate received by the
taxpayer from subrentals.
(2) ascertaining the percentage which the total wages, salaries and
other personal service compensation during such period, of employees,
except general executive officers, serving in jobs created or retained
in an eligible area (as the term "eligible area" was defined by section
one hundred fifteen of the commerce law as it existed on March
thirty-first, nineteen hundred eighty-three) by such business facility,
bears to the total wages, salaries and other personal service
compensation, during such period, of all the taxpayer's employees within
the state, except general executive officers.
(3) adding together the percentages so determined and dividing the
result by two; provided, however, that if no wages, salaries or other
personal service compensation were paid or incurred by the taxpayer
during such period to employees within the state other than general
executive officers, subparagraph two shall be disregarded and the amount
of credit allowable shall be determined by multiplying the tax otherwise
due by the percentage specified in subparagraph one.
* (c) In no event shall the credit herein provided for be allowed in
an amount which will reduce the tax payable to less than the minimum
fixed by clause four of paragraph (a) of subdivision one of this
section.
* NB Applies to taxable years prior to December 31, 1986
* (c) In no event shall the credit herein provided for be allowed in
an amount which will reduce the tax payable to less than the higher of
the amounts prescribed by paragraphs (c) and (d) of subdivision one of
this section.
* NB Applies to taxable years beginning after December 31, 1986
(d) i. Eligible property values, for the purposes of this subdivision,
shall include such part of the value of depreciable real and tangible
personal property included in an eligible business facility as
represents:
(1) expenditures paid or incurred by the taxpayer for capital
improvements consisting of the construction, reconstruction, erection or
improvement of real property included in an eligible business facility,
which construction, reconstruction, erection or improvements were
commenced on or after July first, nineteen hundred sixty-eight;
(2) in the case of real property leased by the taxpayer from another
party, eight times the portion of the net annual rental rate
attributable to such expenditures paid or incurred by the lessor for
such construction, reconstruction, erection or improvement commenced on
or after July first, nineteen hundred sixty-eight;
(3) expenditures paid or incurred by the taxpayer for the purchase of
tangible personal property, other than vehicles, included in an eligible
business facility, provided such property was purchased on or after July
first, nineteen hundred sixty-eight; and
(4) in the case of tangible personal property, other than vehicles,
leased by the taxpayer from another party and included in an eligible
business facility, eight times the net annual rental rate, provided the
period for which such property was leased by the taxpayer began on or
after July first, nineteen hundred sixty-eight.
ii. Provided, however, eligible property values for purposes of this
subdivision shall not include expenditures paid or incurred more than
one year prior to the filing of an application for a certificate of
eligibility pursuant to section one hundred nineteen of the commerce
law, as such section existed on March thirty-first, nineteen hundred
eighty-three.
(e) The total of all credits allowed pursuant to this subdivision in
any taxable year or years with reference to any eligible business
facility shall not exceed the total eligible property values included in
such facility.
(f) If a credit is allowed for any taxable year as herein provided on
the basis of a certificate of eligibility, and if such certificate is
revoked or modified, the taxpayer shall report such revocation or
modification in its report for the taxable year during which it occurs,
and the tax commission shall recompute such credit and may assess any
additional tax resulting from such recomputation within the time fixed
by paragraph eight of subsection (c) of section ten hundred eighty-three
of this chapter.
(g) If a business facility owned or operated by a taxpayer shall be an
eligible business facility for only part of a taxable year, the credit
otherwise allowed by this subdivision shall be prorated according to the
period such facility was an eligible business facility, and if the total
of the eligible property values shall have changed during any taxable
year, a pro-rata adjustment shall be made in computing such credit.
(h) The state tax commission shall be empowered, on or after April
first, nineteen hundred eighty-three, to issue a certificate of
eligibility for tax credits to a taxpayer for an eligible business
facility with regard to which such taxpayer has, prior to July first,
nineteen hundred eighty-three, received from the New York state job
incentive board initial approval of an application for such certificate
by such board as evidenced by the minutes of the meeting of the board at
which such application was approved, or a letter of intent authorized by
section 102.4 of part one hundred two of title five of the codes, rules
and regulations of the state of New York regarding such certificate of
eligibility and to renew, extend, revoke or modify a certificate of
eligibility for tax credits, pursuant to section one hundred twenty of
the commerce law as such section existed on March thirty-first, nineteen
hundred eighty-three.
(i) For purposes of the requirement for eligibility for the credit
allowed under this subdivision that a business facility create or retain
not less than five jobs as provided in subdivision (c) of section one
hundred eighteen of the commerce law as such section existed on March
thirty-first, nineteen hundred eighty-three, a business facility shall
have (1) created not less than five jobs only if the number of jobs for
the taxable year exceeds the number of jobs at the time of the
commencement of the project as stated on its application for initial
approval by five or more; or (2) retained not less than five jobs only
if initial approval was based on the retention of five or more jobs and
(A) the number of jobs for the taxable year is at least equal to the
number of jobs at the time of the commencement of the project as stated
on its application for initial approval or (B) where initial approval
was based on the retention of fewer jobs than the number of jobs at the
time of the commencement of the project as stated on its application for
initial approval, the number of jobs for the taxable year is at least
equal to the number approved for retention. For purposes of this
paragraph, the phrase "initial approval was based on the retention of
five or more jobs" shall mean that such initial approval was given by
the job incentive board to an applicant that had not stated in its
application for initial approval that it would increase the number of
jobs at its facility by at least five.
12. Investment tax credit (ITC). * (a) A taxpayer shall be allowed a
credit, to be computed as hereinafter provided, against the tax imposed
by this article. The amount of the credit shall be the per cent provided
for hereinbelow of the cost or other basis for federal income tax
purposes of tangible personal property and other tangible property,
including buildings and structural components of buildings, described in
paragraph (b) of this subdivision. The percentage to be used to compute
the credit allowed pursuant to this section shall be that percentage
appearing in column two which is opposite the appropriate period in
column one in which the tangible personal property was acquired,
constructed, reconstructed or erected, as the case may be:
Column 1 Column 2
After December 31, 1968 and
prior to January 1, 1974 one per cent
After December 31, 1973 and
prior to January 1, 1978 two per cent
After December 31, 1977 and
prior to January 1, 1979 three per cent
After December 31, 1978
and prior to June 1, 1981 four per cent
After May 31, 1981
and prior to July 1, 1982 five per cent
After June 30, 1982 six per cent
Provided, however, that in the case of an acquisition, construction,
reconstruction or erection which was commenced in any one period and
continued or completed in any subsequent period that a credit for each
such period shall be allowed which shall be the sum of the portion of
the cost or other basis for federal income tax purposes attributable to
such period which portion shall be ascertained by multiplying such cost
or basis by a fraction the numerator of which shall be the expenditures
paid or incurred during such period for such purposes and the
denominator of which shall be the total of all expenditures paid or
incurred for such acquisition, construction, reconstruction or erection,
multiplied by the allowable percentage for such period.
* NB Applies to taxable years prior to December 31, 1986
* (a) A taxpayer shall be allowed a credit, to be computed as
hereinafter provided, against the tax imposed by this article. The
amount of the credit shall be the per cent provided for hereinbelow of
the investment credit base. The investment credit base is the cost or
other basis for federal income tax purposes of tangible personal
property and other tangible property, including buildings and structural
components of buildings, described in paragraph (b) of this subdivision,
less the amount of the nonqualified nonrecourse financing with respect
to such property to the extent such financing would be excludible from
the credit base pursuant to section 46(c)(8) of the internal revenue
code (treating such property as section thirty-eight property
irrespective of whether or not it in fact constitutes section
thirty-eight property). If, at the close of a taxable year following the
taxable year in which such property was placed in service, there is a
net decrease in the amount of nonqualified nonrecourse financing with
respect to such property, such net decrease shall be treated as if it
were the cost or other basis of property described in paragraph (b) of
this subdivision acquired, constructed, reconstructed or erected during
the year of the decrease in the amount of nonqualified nonrecourse
financing. In the case of a combined report the term investment credit
base shall mean the sum of the investment credit base of each
corporation included on such report. The percentage to be used to
compute the credit allowed pursuant to this subdivision shall be that
percentage appearing in column two which is opposite the appropriate
period in column one in which the tangible personal property was
acquired, constructed, reconstructed or erected, as the case may be:
Column 1 Column 2
After December 31, 1968 and
prior to January 1, 1974 one per cent
After December 31, 1973 and
prior to January 1, 1978 two per cent
After December 31, 1977 and
prior to January 1, 1979 three per cent
After December 31, 1978 and
prior to June 1, 1981 four per cent
After May 31, 1981 and
prior to July 1, 1982 five per cent
After June 30, 1982 and
prior to January 1, 1987 six per cent
For taxable years five per cent with respect
beginning in 1987, to the first five hundred
1988 and 1989 million dollars of the
investment credit base, and
four percent with respect to
the investment credit base in
excess of five hundred million
dollars, except that in the case
of research and development
property at the option of the
taxpayer the applicable per-
centage shall be nine
For taxable years beginning
in 1990 five percent with respect to the
first four hundred twenty-five
million dollars of the investment
credit base, and four percent
with respect to the investment
credit base in excess of four
hundred twenty-five million
dollars, except that in the
case of research and
development property at the
option of the taxpayer the
applicable percentage shall
be nine
For taxable years beginning
after 1990 five percent with respect to
the first three hundred fifty
million dollars of the invest-
ment credit base, and four percent
with respect to the investment
credit base in excess of three
hundred fifty million dollars,
except that in the case of
research and development
property at the option of the
taxpayer the applicable
percentage shall be nine
Provided, however, that in the case of an acquisition, construction,
reconstruction or erection which was commenced in any one period and
continued or completed in any subsequent period the credit shall be the
sum of the portions of the investment credit base attributable to each
such period, which portion with respect to each such period shall be
ascertained by multiplying such investment credit base by a fraction the
numerator of which shall be the expenditures paid or incurred during
such period for such purposes and the denominator of which shall be the
total of all expenditures paid or incurred for such acquisition,
construction, reconstruction or erection, multiplied by the allowable
percentage for each such period.
* NB Applies to taxable years beginning after December 31, 1986
(b) (i) A credit shall be allowed under this subdivision with respect
to tangible personal property and other tangible property, including
buildings and structural components of buildings, which are: depreciable
pursuant to section one hundred sixty-seven of the internal revenue
code, have a useful life of four years or more, are acquired by purchase
as defined in section one hundred seventy-nine (d) of the internal
revenue code, have a situs in this state and are (A) principally used by
the taxpayer in the production of goods by manufacturing, processing,
assembling, refining, mining, extracting, farming, agriculture,
horticulture, floriculture, viticulture or commercial fishing, (B)
industrial waste treatment facilities or air pollution control
facilities, used in the taxpayer's trade or business, (C) research and
development property, (D) principally used in the ordinary course of the
taxpayer's trade or business as a broker or dealer in connection with
the purchase or sale (which shall include but not be limited to the
issuance, entering into, assumption, offset, assignment, termination, or
transfer) of stocks, bonds or other securities as defined in section
four hundred seventy-five (c)(2) of the Internal Revenue Code, or of
commodities as defined in section four hundred seventy-five (e) of the
Internal Revenue Code, (E) principally used in the ordinary course of
the taxpayer's trade or business of providing investment advisory
services for a regulated investment company as defined in section eight
hundred fifty-one of the Internal Revenue Code, or lending, loan
arrangement or loan origination services to customers in connection with
the purchase or sale (which shall include but not be limited to the
issuance, entering into, assumption, offset, assignment, termination, or
transfer) of securities as defined in section four hundred seventy-five
(c)(2) of the Internal Revenue Code, (F) principally used in the
ordinary course of the taxpayer's business as an exchange registered as
a national securities exchange within the meaning of sections 3(a)(1)
and 6(a) of the Securities Exchange Act of 1934 or a board of trade as
defined in section 1410(a)(1) of the New York Not-for-Profit Corporation
Law or as an entity that is wholly owned by one or more such national
securities exchanges or boards of trade and that provides automation or
technical services thereto, or (G) principally used as a qualified film
production facility including qualified film production facilities
having a situs in an empire zone designated as such pursuant to article
eighteen-B of the general municipal law, where the taxpayer is providing
three or more services to any qualified film production company using
the facility, including such services as a studio lighting grid,
lighting and grip equipment, multi-line phone service, broadband
information technology access, industrial scale electrical capacity,
food services, security services, and heating, ventilation and air
conditioning. For purposes of clauses (D), (E) and (F) of this
subparagraph, property purchased by a taxpayer affiliated with a
regulated broker, dealer, national securities exchange or board of
trade, is allowed a credit under this subdivision if the property is
used by its affiliated regulated broker, dealer, national securities
exchange or board of trade in accordance with this subdivision.
Provided, however, a taxpayer shall not be allowed the credit provided
by clauses (D), (E) and (F) of this subparagraph unless all or a
substantial portion of the employees performing the administrative and
support functions resulting from or related to the qualifying uses of
such equipment are located in this state. For purposes of this
subdivision, the term "goods" shall not include electricity.
(ii) For purposes of this paragraph, the following definitions shall
apply---
(A) Manufacturing shall mean the process of working raw materials into
wares suitable for use or which gives new shapes, new quality or new
combinations to matter which already has gone through some artificial
process by the use of machinery, tools, appliances and other similar
equipment. Property used in the production of goods shall include
machinery, equipment or other tangible property which is principally
used in the repair and service of other machinery, equipment or other
tangible property used principally in the production of goods and shall
include all facilities used in the production operation, including
storage of material to be used in production and of the products that
are produced.
(B) Research and development property shall mean property which is
used for purposes of research and development in the experimental or
laboratory sense. Such purposes shall not be deemed to include the
ordinary testing or inspection of materials or products for quality
control, efficiency surveys, management studies, consumer surveys,
advertising, promotions, or research in connection with literary,
historical or similar projects.
(C) Industrial waste treatment facilities shall mean property
constituting facilities for the treatment, neutralization or
stabilization of industrial waste and other wastes (as the terms
"industrial waste" and "other wastes" are defined in section 17-0105 of
the environmental conservation law) from a point immediately preceding
the point of such treatment, neutralization or stabilization to the
point of disposal, including the necessary pumping and transmitting
facilities, but excluding such facilities installed for the primary
purpose of salvaging materials which are usable in the manufacturing
process or are marketable.
(D) Air pollution control facilities shall mean property constituting
facilities which remove, reduce, or render less noxious air contaminants
emitted from an air contamination source (as the terms "air contaminant"
and "air contamination source" are defined in section 19-0107 of the
environmental conservation law) from a point immediately preceding the
point of such removal, reduction or rendering to the point of discharge
of air, meeting emission standards as established by the department of
environmental conservation, but excluding such facilities installed for
the primary purpose of salvaging materials which are usable in the
manufacturing process or are marketable and excluding those facilities
which rely for their efficacy on dilution, dispersion or assimilation of
air contaminants in the ambient air after emission. Such term shall
further include flue gas desulfurization equipment and attendant sludge
disposal facilities, fluidized bed boilers, precombustion coal cleaning
facilities or other facilities that conform with this subdivision and
which comply with the provisions of the state acid deposition control
act set forth in title nine of article nineteen of the environmental
conservation law.
(E) The terms "qualified film production facility" and "qualified film
production company" shall have the same meaning as in section
twenty-four of this chapter.
(iii) However, such credit shall be allowed with respect to industrial
waste treatment facilities and air pollution control facilities only on
condition that such facilities have been certified by the state
commissioner of environmental conservation or his designated
representative, pursuant to subdivision one of section 17-0707 or
subdivision one of section 19-0309 of the environmental conservation
law, as complying with applicable provisions of the environmental
conservation law, the public health law, the state sanitary code and
codes, rules, regulations, permits or orders issued pursuant thereto.
* (c) A taxpayer shall not be allowed a credit under this subdivision
with respect to any property described in paragraph (b) hereof if such
property qualifies for the deduction allowed under either subparagraph
three of paragraph (d) or paragraph (e) of subdivision three of this
section whether or not such amount shall have been deducted. Provided,
however, with respect to property which qualifies for a deduction under
either clause (A), (B) or (C) of subparagraph three of paragraph (e)
because such property was ordered on or before December thirty-first,
nineteen hundred sixty-eight, but with respect to which no expenditure
has been paid or incurred at such date, the taxpayer may elect to deduct
the amount allowable under clauses (A), (B) or (C) or may take the
credit provided by this subdivision, but not both.
* NB Applies to taxable years prior to December 31, 1986
* (c) A taxpayer shall not be allowed a credit under this subdivision
with respect to any property described in clause (A) of subparagraph (i)
of paragraph (b) hereof if such property qualifies for the deduction
allowed under either subparagraph three of paragraph (d) or paragraph
(e) of subdivision three of this section whether or not such amount
shall have been deducted. Provided, however, with respect to property
which qualifies for a deduction under either clause (A), (B) or (C) of
subparagraph three of paragraph (e) because such property was ordered on
or before December thirty-first, nineteen hundred sixty-eight, but with
respect to which no expenditure has been paid or incurred at such date,
the taxpayer may elect to deduct the amount allowable under clauses (A),
(B) or (C) or may take the credit provided by this subdivision, but not
both.
* NB Applies to taxable years beginning after December 31, 1986
(d) A taxpayer shall not be allowed a credit under this subdivision
with respect to tangible personal property and other tangible property,
including buildings and structural components of buildings, which it
leases to any other person or corporation except where a taxpayer leases
property to an affiliated regulated broker, dealer, national securities
exchange or board of trade (or other entity described in clause (F) of
subparagraph (i) of paragraph (b) of this subdivision) that uses such
property in accordance with clause (D), (E) or (F) of subparagraph (i)
of paragraph (b) of this subdivision. For purposes of the preceding
sentence, any contract or agreement to lease or rent or for a license to
use such property shall be considered a lease. Provided, however, in
determining whether a taxpayer shall be allowed a credit under this
subdivision with respect to such property, any election made with
respect to such property pursuant to the provisions of paragraph eight
of subsection (f) of section one hundred sixty-eight of the internal
revenue code, as such paragraph was in effect for agreements entered
into prior to January first, nineteen hundred eighty-four, shall be
disregarded. For purposes of this paragraph, the use of a qualified film
production facility by a qualified film production company shall not be
considered a lease of such facility to such company.
* (e) Except as otherwise provided in this paragraph, the credit
allowed under this subdivision for any taxable year shall not reduce the
tax due for such year to less than the minimum fixed by clause four of
paragraph (a) of subdivision one of this section. However, if the amount
of credit allowable under this subdivision for any taxable year reduces
the tax to the mimimum fixed by clause four of paragraph (a) of
subdivision one of this section, any amount of credit not deductible in
such taxable year may be carried over to the following year or years and
may be deducted from the taxpayer's tax for such year or years. In lieu
of such carryover, any such taxpayer which qualifies as a new business
under paragraph (j) of this subdivision may elect to treat the amount of
such carryover as an overpayment of tax to be credited or refunded in
accordance with the provisions of section ten hundred eighty-six of this
chapter, provided, however, the provisions of subsection (c) of section
ten hundred eighty-eight of this chapter notwithstanding, no interest
shall be paid thereon.
* NB Applies to taxable years prior to December 31, 1986
* (e) (1) Except as otherwise provided in this paragraph, the credit
allowed under this subdivision for any taxable year shall not reduce the
tax due for such year to less than the higher of the amounts prescribed
in paragraphs (c) and (d) of subdivision one of this section. However,
if the amount of credit allowable under this subdivision for any taxable
year reduces the tax to such amount, any amount of credit allowed for a
taxable year commencing prior to January first, nineteen hundred
eighty-seven and not deductible in such taxable year may be carried over
to the following year or years and may be deducted from the taxpayer's
tax for such year or years but in no event shall such credit be carried
over to taxable years commencing on or after January first, two thousand
two, and any amount of credit allowed for a taxable year commencing on
or after January first, nineteen hundred eighty-seven and not deductible
in such year may be carried over to the fifteen taxable years next
following such taxable year and may be deducted from the taxpayer's tax
for such year or years. In lieu of such carryover, any such taxpayer
which qualifies as a new business under paragraph (j) of this
subdivision may elect to treat the amount of such carryover as an
overpayment of tax to be credited or refunded in accordance with the
provisions of section ten hundred eighty-six of this chapter, provided,
however, the provisions of subsection (c) of section ten hundred
eighty-eight of this chapter notwithstanding, no interest shall be paid
thereon.
(2) Notwithstanding the provisions of subparagraph one of this
paragraph, a taxpayer may not carry over any amount of credit or credits
allowed under this subdivision to a taxable year during which a
corporate acquisition with respect to which it was a target corporation
occurred ("acquisition year"), or to any subsequent taxable year, where
such credit was allowed for a taxable year prior to the acquisition
year.
(3) Notwithstanding the provisions of subparagraph one of this
paragraph, in the case of a corporate merger or corporate consolidation,
the surviving or consolidated corporation, as the case may be, may not
carry over any amount of credit or credits allowed under this
subdivision which is attributable to any constituent corporation to the
taxable year during which such corporate merger or corporate
consolidation occurred ("merger or consolidation year"), or to any
subsequent taxable year, where such credit was allowed for a taxable
year prior to the merger or consolidation year. Provided, however, where
the taxpayer can demonstrate, through the submission of a copy of the
plan of merger or consolidation and such other evidence as may be
required by the commissioner, the identity of the constituent
corporation which was the acquiring person, then the preceding sentence
shall not apply to such credit or credits allowed to such acquiring
person.
* NB Applies to taxable years beginning after December 31, 1986 and
beginning prior to January 1, 1997
* (e) Except as otherwise provided in this paragraph, the credit
allowed under this subdivision for any taxable year shall not reduce the
tax due for such year to less than the higher of the amounts prescribed
in paragraphs (c) and (d) of subdivision one of this section. However,
if the amount of credit allowable under this subdivision for any taxable
year reduces the tax to such amount, any amount of credit allowed for a
taxable year commencing prior to January first, nineteen hundred
eighty-seven and not deductible in such taxable year may be carried over
to the following year or years and may be deducted from the taxpayer's
tax for such year or years but in no event shall such credit be carried
over to taxable years commencing on or after January first, two thousand
two, and any amount of credit allowed for a taxable year commencing on
or after January first, nineteen hundred eighty-seven and not deductible
in such year may be carried over to the fifteen taxable years next
following such taxable year and may be deducted from the taxpayer's tax
for such year or years. In lieu of such carryover, any such taxpayer
which qualifies as a new business under paragraph (j) of this
subdivision may elect to treat the amount of such carryover as an
overpayment of tax to be credited or refunded in accordance with the
provisions of section ten hundred eighty-six of this chapter, provided,
however, the provisions of subsection (c) of section ten hundred
eighty-eight of this chapter notwithstanding, no interest shall be paid
thereon.
* NB Applicable to taxable years beginning on or after January 1, 1997
* (f) At the option of the taxpayer, air or water pollution control or
control process facilities which qualify for elective deductions under
paragraph (g) of subdivision nine of section two hundred eight, or an
eligible business facility for which a credit is allowed under
subdivision eleven of this section, or research and development
facilities which qualify for elective deduction under subparagraphs two
and three of paragraph (e) of subdivision three of this section may be
treated as property principally used by the taxpayer in the production
of goods by manufacturing, processing, assembling, refining, mining,
extracting, farming, agriculture, horticulture, floriculture,
viticulture or commercial fishing, provided the property otherwise
qualifies under paragraph (b) of this subdivision, in which event, a
deduction shall not be allowed under such paragraph (g), a credit shall
not be allowed under such subdivision eleven and a deduction shall not
be allowed under such subparagraph three of paragraph (e).
* NB Applies to taxable years prior to December 31, 1986
* (f) At the option of the taxpayer an eligible business facility for
which a credit is allowed under subdivision eleven of this section, or,
for taxable years commencing prior to January first, nineteen hundred
eighty-seven, air or water pollution control or controlled process
facilities which qualify for elective deductions under paragraph (g) of
subdivision nine of section two hundred eight, or research and
development facilities which qualify for elective deduction under
subparagraphs two and three of paragraph (e) of subdivision three of
this section may be treated as property principally used by the taxpayer
in the production of goods by manufacturing, processing, assembling,
refining, mining, extracting, farming, agriculture, horticulture,
floriculture, viticulture or commercial fishing, provided the property
otherwise qualifies under paragraph (b) of this subdivision, in which
event, a deduction shall not be allowed under such paragraph (g), a
credit shall not be allowed under such subdivision eleven and a
deduction shall not be allowed under such subparagraph three of
paragraph (e).
* NB Applies to taxable years beginning after December 31, 1986
(g) * (1) With respect to property which is depreciable pursuant to
section one hundred sixty-seven of the internal revenue code and which
is disposed of or ceases to be in qualified use prior to the end of the
taxable year in which the credit is to be taken, the amount of the
credit shall be that portion of the credit provided for in this
subdivision which represents the ratio which the months of qualified use
bear to the months of useful life. If property on which credit has been
taken is disposed of or ceases to be in qualified use prior to the end
of its useful life, the difference between the credit taken and the
credit allowed for actual use must be added back in the year of
disposition. Provided, however, if such property is disposed of or
ceases to be in qualified use after it has been in qualified use for
more than twelve consecutive years, it shall not be necessary to add
back the credit as provided in this subparagraph. The amount of credit
allowed for actual use shall be determined by multiplying the original
credit by the ratio which the months of qualified use bear to the months
of useful life. For purposes of this subparagraph, useful life of
property shall be the same as the taxpayer uses for depreciation
purposes when computing his federal income tax liability.
* NB Does not apply to property to which the amendments made by
section two hundred one of Public Law 99-514 apply
* (1) With respect to property which is depreciable pursuant to
section one hundred sixty-seven of the internal revenue code but is not
subject to the provisions of section one hundred sixty-eight of such
code and which is disposed of or ceases to be in qualified use prior to
the end of the taxable year in which the credit is to be taken, the
amount of the credit shall be that portion of the credit provided for in
this subdivision which represents the ratio which the months of
qualified use bear to the months of useful life. If property on which
credit has been taken is disposed of or ceases to be in qualified use
prior to the end of its useful life, the difference between the credit
taken and the credit allowed for actual use must be added back in the
year of disposition. Provided, however, if such property is disposed of
or ceases to be in qualified use after it has been in qualified use for
more than twelve consecutive years, it shall not be necessary to add
back the credit as provided in this subparagraph. The amount of credit
allowed for actual use shall be determined by multiplying the original
credit by the ratio which the months of qualified use bear to the months
of useful life. For purposes of this subparagraph, useful life of
property shall be the same as the taxpayer uses for depreciation
purposes when computing his federal income tax liability.
* NB Applies to property to which the amendments made by section two
hundred one of Public Law 99-514 apply.
* (2) Except with respect to that property to which subparagraph four
of this paragraph applies, with respect to three-year property, as
defined in paragraph two of subdivision (c) of section one hundred
sixty-eight of the internal revenue code, which is disposed of or ceases
to be in qualified use prior to the end of the taxable year in which the
credit is to be taken, the amount of the credit shall be that portion of
the credit provided for in this subdivision which represents the ratio
which the months of qualified use bear to thirty-six. If property on
which credit has been taken is disposed of or ceases to be in qualified
use prior to the end of thirty-six months, the difference between the
credit taken and the credit allowed for actual use must be added back in
the year of disposition. The amount of credit allowed for actual use
shall be determined by multiplying the original credit by the ratio
which the months of qualified use bear to thirty-six.
* NB Does not apply to property to which the amendments made by
section two hundred one of Public Law 99-514 apply
* (2) Except with respect to that property to which subparagraph four
of this paragraph applies, with respect to three-year property, as
defined in subsection (e) of section one hundred sixty-eight of the
internal revenue code, which is disposed of or ceases to be in qualified
use prior to the end of the taxable year in which the credit is to be
taken, the amount of the credit shall be that portion of the credit
provided for in this subdivision which represents the ratio which the
months of qualified use bear to thirty-six. If property on which credit
has been taken is disposed of or ceases to be in qualified use prior to
the end of thirty-six months, the difference between the credit taken
and the credit allowed for actual use must be added back in the year of
disposition. The amount of credit allowed for actual use shall be
determined by multiplying the original credit by the ratio which the
months of qualified use bear to thirty-six.
* NB Applies to property to which the amendments made by section two
hundred one of Public Law 99-514 apply
* (3) Except with respect to that property to which subparagraph four
of this paragraph applies, with respect to five-year property and
ten-year property, as defined in paragraph two of subdivision (c) of
section one hundred sixty-eight of the internal revenue code,
fifteen-year real property, as defined in such paragraph as it was in
effect for property placed in service after December thirty-first,
nineteen hundred eighty in taxable years ending after such date,
eighteen-year real property, as defined in such paragraph as it was in
effect for property placed in service after March fifteenth, nineteen
hundred eighty-four, and nineteen-year real property, as defined in such
paragraph, which is disposed of or ceases to be in qualified use prior
to the end of the taxable year in which the credit is to be taken, the
amount of the credit shall be that portion of the credit provided for in
this subdivision which represents the ratio which the months of
qualified use bear to sixty. If property on which credit has been taken
is disposed of or ceases to be in qualified use prior to the end of
sixty months, the difference between the credit taken and the credit
allowed for actual use must be added back in the year of disposition.
The amount of credit allowed for actual use shall be determined by
multiplying the original credit by the ratio which the months of
qualified use bear to sixty.
* NB Does not apply to property to which the amendments made by
section two hundred one of Public Law 99-514 apply
* (3) Except with respect to that property to which subparagraph four
of this paragraph applies, with respect to property subject to the
provisions of section one hundred sixty-eight of the internal revenue
code, other than three-year property as defined in subsection (e) of
such section one hundred sixty-eight which is disposed of or ceases to
be in qualified use prior to the end of the taxable year in which the
credit is to be taken, the amount of the credit shall be that portion of
the credit provided for in this subdivision which represents the ratio
which the months of qualified use bear to sixty. If property on which
credit has been taken is disposed of or ceases to be in qualified use
prior to the end of sixty months, the difference between the credit
taken and the credit allowed for actual use must be added back in the
year of disposition. The amount of credit allowed for actual use shall
be determined by multiplying the original credit by the ratio which the
months of qualified use bear to sixty.
* NB Applies to property to which the amendments made by section two
hundred one of Public Law 99-514 apply
* (4) With respect to any recovery property to which section one
hundred sixty-eight of the internal revenue code applies, which is a
building or a structural component of a building and which is disposed
of or ceases to be in qualified use prior to the end of the taxable year
in which the credit is to be taken, the amount of the credit shall be
that portion of the credit provided for in this subdivision which
represents the ratio which the months of qualified use bear to the total
number of months over which the taxpayer chooses to deduct the property
under section one hundred sixty-eight of the internal revenue code. If
property on which credit has been taken is disposed of or ceases to be
in qualified use prior to the end of the period over which the taxpayer
chooses to deduct the property under section one hundred sixty-eight of
the internal revenue code, the difference between the credit taken and
the credit allowed for actual use must be added back in the year of
disposition. Provided, however, if such property is disposed of or
ceases to be in qualified use after it has been in qualified use for
more than twelve consecutive years, it shall not be necessary to add
back the credit as provided in this subparagraph. The amount of credit
allowed for actual use shall be determined by multiplying the original
credit by the ratio which the months of qualified use bear to the total
number of months over which the taxpayer chooses to deduct the property
under section one hundred sixty-eight of the internal revenue code.
* NB Does not apply to property to which the amendments made by
section two hundred one of Public Law 99-514 apply
* (4) With respect to any property to which section one hundred
sixty-eight of the internal revenue code applies, which is a building or
a structural component of a building and which is disposed of or ceases
to be in qualified use prior to the end of the taxable year in which the
credit is to be taken, the amount of the credit shall be that portion of
the credit provided for in this subdivision which represents the ratio
which the months of qualified use bear to the total number of months
over which the taxpayer chooses to deduct the property under the
internal revenue code. If property on which credit has been taken is
disposed of or ceases to be in qualified use prior to the end of the
period over which the taxpayer chooses to deduct the property under the
internal revenue code, the difference between the credit taken and the
credit allowed for actual use must be added back in the year of
disposition. Provided, however, if such property is disposed of or
ceases to be in qualified use after it has been in qualified use for
more than twelve consecutive years, it shall not be necessary to add
back the credit as provided in this subparagraph. The amount of credit
allowed for actual use shall be determined by multiplying the original
credit by the ratio which the months of qualified use bear to the total
number of months over which the taxpayer chooses to deduct the property
under the internal revenue code.
* NB Applies to property to which the amendments made by section two
hundred one of Public Law 99-514 apply
* (5) For purposes of this paragraph, property (i) which is described
in subparagraph two, three or four of this paragraph, and (ii) which is
subject to subparagraph eleven of paragraph (a) of subdivision nine and
subparagraph ten of paragraph (b) of subdivision nine of section two
hundred eight of this chapter, shall be treated as property which is
depreciable pursuant to section one hundred sixty-seven of the internal
revenue code but is not subject to section one hundred sixty-eight of
such code.
* NB Applies to taxable years beginning after December 31, 1986
* (6) For purposes of this paragraph, where a credit is allowed with
respect to an air pollution control facility on the basis of a
certificate of compliance issued pursuant to the environmental
conservation law and the certificate is revoked pursuant to subdivision
three of section 19-0309 of the environmental conservation law, such
revocation shall constitute a disposal or cessation of qualified use,
unless such facility is described in clause (A) or (C) of subparagraph
(ii) of paragraph (b) of this subdivision. Also for purposes of this
subparagraph, the use of an air pollution control facility or an
industrial waste treatment facility for the primary purpose of salvaging
materials which are usable in the manufacturing process or are
marketable shall constitute a cessation of qualified use, unless such
facility is described in clause (A) or (C) of subparagraph (ii) of
paragraph (b) of this subdivision.
* NB Applies to taxable years beginning after December 31, 1986
(7) For taxable years commencing on or after January first, nineteen
hundred eighty-seven, the amount required to be added back pursuant to
this paragraph shall be augmented by an amount equal to the product of
such amount and the underpayment rate of interest (without regard to
compounding), set by the commissioner of taxation and finance pursuant
to subsection (e) of section one thousand ninety-six, in effect on the
last day of the taxable year.
* (8) If, as of the close of the taxable year, there is a net increase
with respect to the taxpayer in the amount of nonqualified nonrecourse
financing (within the meaning of section 46(c) (8) of the internal
revenue code) with respect to any property with respect to which the
credit under this subdivision was limited based on attributable
nonqualified nonrecourse financing, then an amount equal to the decrease
in such credit which would have resulted from reducing, by the amount of
such net increase, the cost or other basis taken into account with
respect to such property must be added back in such taxable year. The
amount of nonqualified nonrecourse financing shall not be treated as
increased by reason of a transfer of (or agreement to transfer) any
evidence of an indebtedness if such transfer occurs (or such agreement
is entered into) more than one year after the date such indebtedness was
incurred.
* NB Applies to taxable years beginning after December 31, 1986
* (9) Where the taxpayer is a target corporation in a subdivision
seventeen corporate acquisition, property which was the basis for the
allowance of the credit provided for under this subdivision shall be
deemed to be disposed of in the taxable year in which such acquisition
occurred.
* NB Repealed for taxable years beginning on or after January 1, 1997
* (10) Where the taxpayer is a consolidated corporation in a
subdivision eighteen corporate consolidation, property of a target
corporation which was the basis for the allowance of the credit provided
for under this subdivision, shall be deemed to be disposed of on the day
immediately preceding such subdivision eighteen corporate consolidation.
* NB Repealed for taxable years beginning on or after January 1, 1997
* (11) Where the taxpayer is a surviving corporation in a subdivision
eighteen corporate merger, property of a target corporation which was
the basis for the allowance of the credit provided for under this
subdivision, shall be deemed to be disposed of on the day immediately
preceding such subdivision eighteen corporate merger.
* NB Repealed for taxable years beginning on or after January 1, 1997
(11) (A) Where property with respect to which credit has been allowed
under this subdivision is disposed of by transfer to the taxpayer in a
qualified transaction, and such disposition requires, pursuant to this
paragraph (without regard to this subparagraph) that such credit be
decreased (where the disposition occurs in the taxable year in which the
property is placed in service by the transferor) or that a portion of
such credit be added back by the transferor, then clause (B) or clause
(C) of this subparagraph shall apply.
(B) If the taxpayer and the transferor jointly elect, at such time and
in such manner as the commissioner may prescribe, the following shall
apply:
(i) such portion shall not be required to be added back by the
transferor,
(ii) the amount of unused credit shall not be deducted from tax
otherwise due by the transferor on any return (including an amended
return), and shall not be so deducted as part of any audit adjustment or
any other determination, and
(iii) the amount of unused credit shall be treated as an amount of
credit of the taxpayer under this subdivision carried forward by the
taxpayer to its taxable year in which such transfer occurred, as if the
credit allowed to the transferor with respect to such property had
originally been allowed to the taxpayer both as to amount and first date
of qualified use, and as if the period of qualified use by the
transferor prior to the transfer had been a period of such use by the
taxpayer. Any amount of credit treated as carried forward to the taxable
year pursuant to this subparagraph shall be applied as provided in
clause (H) of this subparagraph.
(C) If the taxpayer and the transferor do not make the election
described in clause (B) of this subparagraph, then the amount of credit
required pursuant to this paragraph to be added back by the transferor
shall be treated as an amount of credit of the taxpayer under this
subdivision to be carried forward by the taxpayer to its taxable year in
which such transfer occurred, as if the credit allowed to the transferor
with respect to such property had originally been allowed to the
taxpayer both as to amount and first date of qualified use, and as if
the period of qualified use by the transferor prior to the transfer had
been a period of such use by the taxpayer. Any amount of credit treated
as carried forward to the taxable year pursuant to this subparagraph
shall be applied as provided in clause (H) of this subparagraph.
(D) The term "qualified transaction" shall mean a transaction which is
a reorganization described in section 368(a)(1)(D) of the internal
revenue code, wherein (i) substantially all of the assets of the
transferor necessary to continue the operation of a division or
divisions of the transferor are transferred to the taxpayer in a
transaction to which section 351 of such code applies, and (ii) stock or
securities of the taxpayer held by the transferor are distributed
pursuant to section 355 of such code.
(E) The term "unused credit" shall mean the amount of credit shown as
carried forward to the transaction year on the transferor's tax return
for its taxable year immediately preceding the transaction year with
respect to the property described in clause (A) of this subparagraph.
(F) The term "transaction year" means the taxable year in which the
qualified transaction occurs.
(G) Notwithstanding any other provision of law to the contrary, in the
case of allowance of credit pursuant to this subparagraph to a taxpayer
the commissioner shall have the authority to reveal to the taxpayer any
information, with respect to the credit of the transferor, which is the
basis for the denial in whole or in part of the credit claimed by such
taxpayer.
(H) Where a credit is allowed to a taxpayer pursuant to this
subparagraph, the taxpayer may treat the amount of such credit as an
overpayment of tax to be credited or refunded in accordance with the
provisions of section ten hundred eighty-six of this chapter, provided,
however, the provisions of subsection (c) of section ten hundred
eighty-eight of this chapter notwithstanding, no interest shall be paid
thereon. Such credit shall be allowed against the tax imposed by this
article with respect to the second succeeding taxable year next
following the transaction year, provided that not more than one-fourth
of the amount of such credit may be applied by the taxpayer, whether to
reduce tax otherwise due or to be treated as an overpayment to be
credited or refunded, with respect to such second succeeding taxable
year and each of the next three taxable years following such second
succeeding taxable year.
(j) For purposes of paragraph (e) of this subdivision, a new business
shall include any corporation, except a corporation which:
(1) over fifty percent of the number of shares of stock entitling the
holders thereof to vote for the election of directors or trustees is
owned or controlled, either directly or indirectly, by a taxpayer
subject to tax under this article; section one hundred eighty-three, one
hundred eighty-four or one hundred eighty-five of article nine; article
thirty-two or thirty-three of this chapter; or
(2) is substantially similar in operation and in ownership to a
business entity (or entities) taxable, or previously taxable, under this
article; section one hundred eighty-three, one hundred eighty-four, one
hundred eighty-five or one hundred eighty-six of article nine; article
thirty-two or thirty-three of this chapter; article twenty-three of this
chapter or which would have been subject to tax under such article
twenty-three (as such article was in effect on January first, nineteen
hundred eighty) or the income (or losses) of which is (or was)
includable under article twenty-two of this chapter whereby the intent
and purpose of this paragraph and paragraph (e) of this subdivision with
respect to refunding of credit to new business would be evaded; or
(3) has been subject to tax under this article for more than five
taxable years (excluding short taxable years).
(k) Retail enterprise tax credit. A retail enterprise not eligible for
the credit under paragraph (a) of this subdivision, but eligible for the
credit provided for under section thirty-eight of the internal revenue
code pursuant solely to the provisions of subparagraph (E) of paragraph
one of subsection (a) of section forty-eight of such code, shall be
allowed a credit as hereinafter computed. The amount of the credit shall
be the percentage appearing in paragraph (a) of this subdivision for the
periods described therein for the amount of qualified rehabilitation
expenditures, as defined in subsection (g) of section forty-eight of
such code, paid or incurred with respect to a qualified rehabilitated
building, as defined in such subsection (g), located in this state and
such expenditures shall further be limited to only the portion thereof
paid or incurred with respect to that part of a qualified rehabilitated
building employed by such taxpayer in the retail sales activity of such
retail enterprise. For the purposes of this subdivision, the term
"retail enterprise" means a taxpayer which is: (i) a registered vendor
under article twenty-eight of this chapter, (ii) primarily engaged in
the retail sale, as the term "retail sale" is defined in subparagraph
(i) of paragraph four of subdivision (b) of section eleven hundred one
of this chapter, of tangible personal property, and (iii) otherwise
eligible for the credit allowed pursuant to section thirty-eight of the
internal revenue code.
(l) Rehabilitation credit for historic barns. A taxpayer shall be
allowed a credit, to be computed as hereinafter provided, against the
tax imposed by this article. The amount of the credit shall be
twenty-five percent of the taxpayer's qualified rehabilitation
expenditures, as defined in paragraph two of subsection (c) of section
forty-seven of the internal revenue code, which qualify as the basis for
the credit provided for under paragraph one of subsection (b) of section
thirty-eight of such code by reason of subsection one of section
forty-six of such code, paid or incurred with respect to any barn
located in this state which is a qualified rehabilitated building, as
such term is defined in paragraph one of subsection (c) of such section
forty-seven. For purposes of this paragraph, the term "barn" means a
building originally designed and used for storing farm equipment or
agricultural products, or for housing livestock. Provided, however, such
qualified rehabilitation expenditures shall not include any such
expenditures which are included, directly or indirectly, in the
computation of a credit claimed by the taxpayer pursuant to paragraph
(a) of this subdivision. Provided further that no rehabilitation credit
shall be allowed for any rehabilitation that converts such barn to a
residential purpose, nor shall a rehabilitation credit be allowed for
any rehabilitation that materially alters the historic appearance of the
barn.
(m)(1)(i) If a taxpayer is required by paragraph (g) of this
subdivision to add back a portion of the credit taken because property
was destroyed or ceased to be in qualified use as a direct result of the
September eleventh, two thousand one terrorist attacks, such taxpayer
may elect to defer the amount to be recaptured for all such property to
the taxable year next succeeding the taxable year in which the
destruction or cessation of qualified use occurred. The taxable year in
which the destruction or cessation of qualified use occurred shall be
hereinafter referred to as the "recapture event taxable year". If the
taxpayer's total employment number in the state on the last day of the
taxable year next succeeding the recapture event taxable year is a
significant percentage of the taxpayer's average total employment number
in the state for the taxpayer's recapture event taxable year and the two
taxable years immediately preceding the recapture event taxable year,
then the taxpayer shall not be required to recapture any credit with
respect to such property. If the taxpayer's total employment number in
the state on the last day of the taxable year next succeeding the
recapture event taxable year is not a significant percentage of the
taxpayer's average total employment number in the state for the
recapture event taxable year and the two taxable years immediately
preceding the recapture event taxable year, the taxpayer shall be
required to recapture the portion of the credit taken under this
subdivision, as required by paragraph (g) of this subdivision, for all
of its property destroyed or which ceased to be in qualified use as a
direct result of the September eleventh, two thousand one terrorist
attacks. The amount required to be recaptured shall be augmented as
required pursuant to subparagraph seven of paragraph (g) of this
subdivision by using an interest rate equal to two times the rate of
interest specified in such subparagraph seven applicable for the taxable
year in which the recapture occurs.
(ii) The taxpayer's total employment number shall include all
employees of the taxpayer employed full-time by the taxpayer in the
state. The average total employment number for the recapture event
taxable year and the two taxable years immediately preceding the
recapture event taxable year shall be computed by determining the
taxpayer's total employment number on the thirty-first day of March, the
thirtieth day of June, the thirtieth day of September and the
thirty-first day of December during the applicable taxable years, adding
together the number of such individuals determined to be so employed on
each of such dates and dividing the sum so obtained by the number of
such dates occurring within such applicable taxable years. However, in
the case of the taxable year which included September eleventh, two
thousand one, the average total employment number for such taxable year
shall be determined by using the total employment number on September
first, two thousand one in lieu of September thirtieth, two thousand one
and, if such taxable year included December thirty-first, two thousand
one, by excluding the total employment number on December thirty-first,
two thousand one.
(2) In lieu of subparagraph one of this paragraph, a taxpayer may
elect to recapture the portion of the credit taken under this
subdivision, as required by paragraph (g) of this subdivision, for all
of its property which was destroyed or ceased to be in qualified use as
a direct result of the September eleventh, two thousand one terrorist
attacks, in the taxable year in which the destruction or cessation of
use occurred. If the taxpayer makes such election and acquires property
(hereinafter referred to as "replacement property") to replace any
property destroyed as a direct result of the September eleventh, two
thousand one terrorist attacks (regardless of when such property was
placed in service and whether a credit was claimed on that property
pursuant to this subdivision), and such replacement property is similar
or related in service or use to such destroyed property, the investment
credit base of the replacement property shall be determined without
regard to any basis reduction required pursuant to section 1033 of the
internal revenue code.
(3) The election made by the taxpayer under subparagraph one or two of
this paragraph shall be made in the manner and form prescribed by the
commissioner.
(4) A taxpayer, over fifty percent of whose employees died as a direct
result of the September eleventh, two thousand one terrorist attacks,
may make the election provided for in subparagraph one of this
paragraph, and shall not be required to recapture any credit with
respect to property which was destroyed or which ceased to be in
qualified use as a direct result of such attacks, whether or not it
meets the employment test specified in clause (i) of subparagraph one of
this paragraph.
12-A. Additional investment tax credit. (a) Where a taxpayer is
allowed a credit under subdivision twelve, with respect to property, the
acquisition, construction, reconstruction or erection of which commenced
on or after the first day of January, nineteen hundred seventy-six and
prior to January first, nineteen hundred eighty-seven, the taxpayer
shall be allowed a credit for each of the three years next succeeding
the taxable year for which the credit under subdivision twelve is
allowed with respect to such property, whether or not deductible in such
taxable year or in subsequent taxable years pursuant to paragraph (e) of
such subdivision twelve, of fifty per cent of the credit allowable under
subdivision twelve; provided, however, that the credit allowable under
this subdivision for any taxable year shall only be allowed if the
average number of employees during such taxable year is at least one
hundred one per cent of the average number of employees during the
taxable year immediately preceding the taxable year for which the credit
under subdivision twelve is allowed and provided, further, that, for
taxable years beginning on or after January first, nineteen hundred
eighty-one, if the taxpayer was not subject to tax and did not have a
taxable year immediately preceding the taxable year for which the credit
under subdivision twelve of this section is allowed, the credit
allowable under this subdivision for any taxable year shall be allowed
if the average number of employees in such taxable year is at least one
hundred one per cent of the average number of employees during the
taxable year in which the credit under such subdivision twelve is
allowed.
(b) The average number of employees in a taxable year shall be
computed by ascertaining the number of employees within the state,
except general executive officers, employed by the taxpayer on the
thirty-first day of March, the thirtieth day of June, the thirtieth day
of September and the thirty-first day of December in the taxable year,
by adding together the number of employees ascertained on each of such
dates and dividing the sum so obtained by the number of such
abovementioned dates occuring within the taxable year. For the purposes
of this subdivision, the term "employees within the state, except
general executive officers" shall mean the same as in subparagraph three
of paragraph (a) of subdivision three of this section.
* (c) In no event shall the credit herein provided for be allowed in
an amount which will reduce the tax payable to less than the minimum
fixed by clause four of paragraph (a) of subdivision one of this
section. However, if the amount of credit allowable under this
subdivision for any taxable year reduces the tax to such amount, any
amount of credit not deductible in such taxable year may be carried over
to the following year or years and may be deducted from the taxpayer's
tax for such year or years.
* NB Applies to taxable years prior to December 31, 1986
* (c) (1) In no event shall the credit herein provided for be allowed
in an amount which will reduce the tax payable to less than the higher
of the amounts prescribed in paragraphs (c) and (d) of subdivision one
of this section. However, if the amount of credit allowable under this
subdivision for any taxable year reduces the tax to such amount, any
amount of credit not deductible in such taxable year may be carried over
to the following year or years and may be deducted from the taxpayer's
tax for such year or years but in no event shall such credit be carried
over to taxable years commencing on or after January first, two thousand
two.
(2) Notwithstanding the provisions of subparagraph one of this
paragraph, a taxpayer may not carry over any amount of credit allowed
under this subdivision to a taxable year during which a corporate
acquisition with respect to which it was a target corporation occurred
("acquisition year"), or to any subsequent taxable year, where such
credit was allowed for a taxable year prior to the acquisition year.
(3) Notwithstanding the provisions of subparagraph one of this
paragraph, in the case of a corporate merger or corporate consolidation,
the surviving or consolidated corporation, as the case may be, may not
carry over any amount of credit or credits allowed under this
subdivision which is attributable to a target corporation to the taxable
year during which such corporate merger or corporate consolidation
occurred ("merger or consolidation year"), or to any subsequent taxable
year, where such credit was allowed for a taxable year prior to the
merger or consolidation year. Provided, however, where the taxpayer can
demonstrate, through the submission of a copy of the plan of merger or
consolidation and such other evidence as may be required by the
commissioner, the identity of the constituent corporation which was the
acquiring person, then the preceding sentence shall not apply to such
credit or credits allowed to such acquiring person.
* NB Applies to taxable years beginning after December 31, 1986 and
prior to January 1, 1997
* (c) In no event shall the credit herein provided for be allowed in
an amount which will reduce the tax payable to less than the higher of
the amounts prescribed in paragraphs (c) and (d) of subdivision one of
this section. However, if the amount of credit allowable under this
subdivision for any taxable year reduces the tax to such amount, any
amount of credit not deductible in such taxable year may be carried over
to the following year or years and may be deducted from the taxpayer's
tax for such year or years but in no event shall such credit be carried
over to taxable years commencing on or after January first, two thousand
two.
* NB Applicable to taxable years beginning on or after January 1, 1997
12-B. Empire zone investment tax credit (EZ-ITC). (a) A taxpayer shall
be allowed a credit, to be computed as herein provided, against the tax
imposed by this article if the taxpayer has been certified pursuant to
article eighteen-B of the general municipal law. The amount of the
credit shall be ten percent of the cost or other basis for federal
income tax purposes of tangible personal property and other tangible
property, including buildings and structural components of buildings,
described in paragraph (b) of this subdivision, which is located within
an empire zone designated as such pursuant to article eighteen-B of such
law, but only if the acquisition, construction, reconstruction or
erection of such property occurred or was commenced on or after the date
of such designation and prior to the expiration thereof. Provided,
however, that in the case of an acquisition, construction,
reconstruction or erection which was commenced during such period and
continued or completed subsequently, such credit shall be ten percent of
the portion of the cost or other basis for federal income tax purposes
attributable to such period, which portion shall be ascertained by
multiplying such cost or basis by a fraction the numerator of which
shall be the expenditures paid or incurred during such period for such
purposes and the denominator of which shall be the total of all
expenditures paid or incurred for such acquisition, construction,
reconstruction or erection.
* (b) A credit shall be allowed under this section with respect to
tangible personal property and other tangible property, including
buildings and structural components of buildings, which (i) are
depreciable pursuant to section one hundred sixty-seven of the internal
revenue code or recovery property with respect to which a deduction is
allowable under section one hundred sixty-eight of the internal revenue
code, (ii) have a useful life of four years or more, (iii) are acquired
by purchase as defined in section one hundred seventy-nine (d) of the
internal revenue code, (iv) have a situs in an empire zone designated as
such pursuant to article eighteen-B of the general municipal law, and
(v) are principally used by the taxpayer in the production of goods by
manufacturing, processing, assembling, refining, mining, extracting,
farming, agriculture, horticulture, floriculture, viticulture or
commercial fishing. For purposes of this paragraph, manufacturing shall
mean the process of working raw materials into wares suitable for use or
which gives new shapes, new quality or new combinations to matter which
already has gone through some artificial process by the use of
machinery, tools, appliances and other similar equipment. Property used
in the production of goods shall include machinery, equipment or other
tangible property used principally in the production of goods and shall
include all facilities used in the production operation, including
storage of material to be used in production and of the products that
are produced.
* NB Applies to taxable years prior to December 31, 1986
* (b) A credit shall be allowed under this subdivision with respect to
tangible personal property and other tangible property, including
buildings and structural components of buildings, which (i) are
depreciable pursuant to section one hundred sixty-seven of the internal
revenue code, (ii) have a useful life of four years or more, (iii) are
acquired by purchase as defined in section one hundred seventy-nine (d)
of the internal revenue code, (iv) have a situs in an empire zone
designated as such pursuant to article eighteen-B of the general
municipal law, and (v) are (A) principally used by the taxpayer in the
production of goods by manufacturing, processing, assembling, refining,
mining, extracting, farming, agriculture, horticulture, floriculture,
viticulture or commercial fishing, (B) industrial waste treatment
facilities or air pollution control facilities used in the taxpayer's
trade or business, (C) research and development property, (D)
principally used in the ordinary course of the taxpayer's trade or
business as a broker or dealer in connection with the purchase or sale
(which shall include but not be limited to the issuance, entering into,
assumption, offset, assignment, termination, or transfer) of stocks,
bonds or other securities as defined in section four hundred
seventy-five (c)(2) of the Internal Revenue Code, or of commodities as
defined in section four hundred seventy-five (e) of the Internal Revenue
Code, (E) principally used in the ordinary course of the taxpayer's
trade or business of providing investment advisory services for a
regulated investment company as defined in section eight hundred
fifty-one of the Internal Revenue Code, or lending, loan arrangement, or
loan origination services to customers in connection with the purchase
or sale (which shall include but not be limited to the issuance,
entering into, assumption, offset, assignment, termination or transfer)
of securities as defined in section four hundred seventy-five (c)(2) of
the Internal Revenue Code, or (F) principally used in the ordinary
course of the taxpayer's business as an exchange registered as a
national securities exchange within the meaning of sections 3(a)(1) and
6(a) of the Securities Exchange Act of 1934 or a board of trade as
defined in subdivision one of paragraph (a) of section fourteen hundred
ten of the not-for-profit corporation law or as an entity that is wholly
owned by one or more such national securities exchanges or boards of
trade and that provides automation or technical services thereto. For
purposes of clauses (D), (E) and (F) of subparagraph (v) of this
paragraph, property purchased by a taxpayer affiliated with a regulated
broker, dealer, national securities exchange or board of trade is
allowed a credit under this subdivision if the property is used by its
affiliated regulated broker, dealer or national securities exchange or
board of trade in accordance with this subdivision. Provided, however, a
taxpayer shall not be allowed the credit provided by clauses (D), (E)
and (F) of this subparagraph unless all or a substantial portion of the
employees performing the administrative and support functions resulting
from or related to the qualifying uses of such equipment are located in
this state. For the purpose of this subdivision, the term "goods" shall
not include electricity. For purposes of this paragraph, manufacturing
shall mean the process of working raw materials into wares suitable for
use or which gives new shapes, new quality or new combinations to matter
which already has gone through some artificial process by the use of
machinery, tools, appliances and other similar equipment. Property used
in the production of goods shall include machinery, equipment or other
tangible property which is principally used in the repair and service of
other machinery, equipment or other tangible property used principally
in the production of goods and shall include all facilities used in the
production operation, including storage of material to be used in
production and of the products that are produced. For purposes of this
paragraph, the terms "research and development property", "industrial
waste treatment facilities", and "air pollution control facilities"
shall have the meanings ascribed thereto by clauses (B), (C) and (D),
respectively, of subparagraph (ii) of paragraph (b) of subdivision
twelve of this section, and the provisions of subparagraph (iii) of such
paragraph (b) shall apply.
* NB Applies to taxable years beginning after December 31, 1986
(c) A taxpayer shall not be allowed a credit under this subdivision
with respect to any tangible personal property and other tangible
property, including buildings and structural components of buildings,
which it leases to any other person or corporation except where a
taxpayer leases property to an affiliated regulated broker, dealer,
national securities exchange or board of trade (or other entity
described in clause (F) of subparagraph (v) of paragraph (b) of this
subdivision that uses such property in accordance with clause (D), (E)
or (F) of subparagraph (v) of paragraph (b) of this subdivision. For
purposes of the preceding sentence, any contract or agreement to lease
or rent or for a license to use such property shall be considered a
lease. Provided, however, in determining whether a taxpayer shall be
allowed a credit under this subdivision with respect to such property,
any election made with respect to such property pursuant to the
provisions of paragraph eight of subsection (f) of section one hundred
sixty-eight of the internal revenue code, as such paragraph was in
effect for agreements entered into prior to January first, nineteen
hundred eighty-four, shall be disregarded.
* (d) The credit allowed under this subdivision for any taxable year
shall not reduce the tax due for such year to less than the minimum
fixed by subparagraph four of paragraph (a) of subdivision one of this
section. Provided, however, that if the amount of credit allowable under
this subdivision for any taxable year reduces the tax to the minimum
fixed by subparagraph four of paragraph (a) of subdivision one of this
section, any amount of credit not deductible in such taxable year may be
carried over to the following year or years and may be deducted from the
taxpayer's tax for such year or years.
* NB Applies to taxable years prior to December 31, 1986
* (d) The credit allowed under this subdivision for any taxable year
shall not reduce the tax due for such year to less than the higher of
the amounts prescribed in paragraphs (c) and (d) of subdivision one of
this section. Provided, however, that if the amount of credit allowed
under this subdivision for any taxable year reduces the tax to such
amount, any amount of credit not deductible in such taxable year may be
carried over to the following year or years and may be deducted from the
taxpayer's tax for such year or years. In lieu of such carryover, any
such taxpayer which qualifies as a new business under paragraph (j) of
subdivision twelve of this section may elect, on its report for its
taxable year with respect to which such credit is allowed, to treat
fifty percent of the amount of such carryover as an overpayment of tax
to be credited or refunded in accordance with the provisions of section
ten hundred eighty-six of this chapter. Provided, however, the
provisions of subsection (c) of section ten hundred eighty-eight of this
chapter notwithstanding, no interest shall be paid thereon.
* NB Applies to taxable years beginning after December 31, 1986
(e) At the option of the taxpayer air or water pollution control
facilities which qualify for elective deductions under paragraph (g) of
subdivision nine of section two hundred eight of this article or an
eligible business facility for which a credit is allowed under
subdivision eleven of this section, or research and development
facilities which qualify for elective deduction under subparagraphs two
and three of paragraph (e) of subdivision three of this section, or
property which qualifies for the credit provided under subdivision
twelve or eighteen of this section may be treated as property
principally used by the taxpayer in the production of goods by
manufacturing, processing, assembling, refining, mining, extracting,
farming, agriculture, horticulture, viticulture or commercial fishing,
provided the property otherwise qualifies under paragraph (b) of this
subdivision, in which event a deduction shall not be allowed under such
paragraph (g), a credit shall not be allowed under such subdivision
eleven and a deduction shall not be allowed under such subparagraph
three of paragraph (e) and a credit shall not be allowed under such
subdivision twelve or eighteen.
* (f) (1) With respect to property which is depreciable pursuant to
section one hundred sixty-seven of the internal revenue code and which
is disposed of or ceases to be in qualified use prior to the end of the
taxable year in which the credit is to be taken, the amount of the
credit shall be that portion of the credit provided for in this
subdivision which represents the ratio which the months of qualified use
bear to the months of useful life. If property on which credit has been
taken is disposed of or ceases to be in qualified use prior to the end
of its useful life, the difference between the credit taken and the
credit allowed for actual use must be added back in the year of
disposition. Provided, however, if such property is disposed of or
ceases to be in qualified use after it has been in qualified use for
more than twelve consecutive years, it shall not be necessary to add
back the credit as provided in this subparagraph. The amount of credit
allowed for actual use shall be determined by multiplying the original
credit by the ratio which the months of qualified use bear to the months
of useful life. For purposes of this subparagraph, useful life of
property shall be the same as the taxpayer uses for depreciation
purposes when computing his federal income tax liability.
(2) Except with respect to that property to which subparagraph four of
this paragraph applies, with respect to three-year property, as defined
in paragraph two of subsection (c) of section one hundred sixty-eight of
the internal revenue code, which is disposed of or ceases to be in
qualified use prior to the end of the taxable year in which the credit
is to be taken, the amount of the credit shall be that portion of the
credit provided for in this subdivision which represents the ratio which
the months of qualified use bear to thirty-six. If property on which
credit has been taken is disposed of or ceases to be in qualified use
prior to the end of thirty-six months, the difference between the credit
taken and the credit allowed for actual use must be added back in the
year of disposition. The amount of credit allowed for actual use shall
be determined by multiplying the original credit by the ratio which the
months of qualified use bear to thirty-six.
(3) Except with respect to that property to which subparagraph four of
this paragraph applies, with respect to five-year property and ten-year
property, as defined in paragraph two of subsection (c) of section one
hundred sixty-eight of the internal revenue code, fifteen-year real
property, as defined in such paragraph as it was in effect for property
placed in service after December thirty-first, nineteen hundred eighty
in taxable years ending after such date, eighteen-year real property, as
defined in such paragraph as it was in effect for property placed in
service after March fifteenth, nineteen hundred eighty-four, and
nineteen-year real property, as defined in such paragraph, which is
disposed of or ceases to be in qualified use prior to the end of the
taxable year in which the credit is to be taken, the amount of the
credit shall be that portion of the credit provided for in this
subdivision which represents the ratio which the months of qualified use
bear to sixty. If property on which credit has been taken is disposed of
or ceases to be in qualified use prior to the end of sixty months, the
difference between the credit taken and the credit allowed for actual
use must be added back in the year of disposition. The amount of credit
allowed for actual use shall be determined by multiplying the original
credit by the ratio which the months of qualified use bear to sixty.
(4) With respect to any recovery property to which section one hundred
sixty-eight of the internal revenue code applies, which is a building or
a structural component of a building and which is disposed of or ceases
to be in qualified use prior to the end of the taxable year in which the
credit is to be taken, the amount of the credit shall be that portion of
the credit provided for in this subdivision which represents the ratio
which the months of qualified use bear to the total number of months
over which the taxpayer chooses to deduct the property under section one
hundred sixty-eight of the internal revenue code. If property on which
credit has been taken is disposed of or ceases to be in qualified use
prior to the end of the period over which the taxpayer chooses to deduct
the property under section one hundred sixty-eight of the internal
revenue code, the difference between the credit taken and the credit
allowed for actual use must be added back in the year of disposition.
Provided, however, if such property is disposed of or ceases to be in
qualified use after it has been in qualified use for more than twelve
consecutive years, it shall not be necessary to add back the credit as
provided in this subparagraph. The amount of credit allowed for actual
use shall be determined by multiplying the original credit by the ratio
which the months of qualified use bear to the total number of months
over which the taxpayer chooses to deduct the property under section one
hundred sixty-eight of the internal revenue code.
(5) For purposes of this paragraph, disposal or cessation of qualified
use shall not be deemed to have occurred solely by reason of the
termination or expiration of an empire zone's designation as such.
(6)(A) For purposes of this paragraph, the decertification of a
business enterprise with respect to an empire zone shall constitute a
disposal or cessation of qualified use of the property on which the
credit was taken which is located in the zone to which the
decertification applies, on the effective date of such decertification.
(B) Where a business enterprise has been decertified based on a
finding pursuant to clause one, two, or five of subdivision (a) of
section nine hundred fifty-nine of the general municipal law, the amount
required to be added back by reason of this paragraph shall be augmented
by an amount equal to the product of the amount of credit, with respect
to property which is disposed of or ceases to be in qualified use, which
was deducted from the taxpayer's tax otherwise due under this article
for all prior taxable years (subject to the limit set forth in this
subparagraph) and the underpayment rate of interest (without regard to
compounding) set by the commissioner of taxation and finance pursuant to
subdivision (e) of section one thousand ninety-six of this chapter, in
effect on the last day of the taxable year. The limit shall be (i) the
amount of credit, with respect to the property which is disposed of or
ceases to be in qualified use, which was deducted from the taxpayer's
tax otherwise due under this article for all prior taxable years,
reduced (but not below zero) by (ii) the credit allowed for actual use.
For purposes of this subparagraph, the attribution to specific property
of credit amounts deducted from tax shall be established in accordance
with the date of placement in service of such property in the empire
zone.
(C) In no event shall the amount of the credit allowed pursuant to
this subdivision be rendered, solely by reason of clause (A) of this
subparagraph, less than the amount of the credit to which the taxpayer
would otherwise be entitled under subdivision twelve of this section.
(D) Notwithstanding any other provision of this subdivision, in the
case of a business enterprise which has been decertified, any amount of
credit allowed with respect to the property of such business enterprise
located in the zone to which the decertification applies which is
carried over pursuant to paragraph (d) of this subdivision shall not be
carried over beyond the seventh taxable year next following the taxable
year with respect to which the credit provided for in this subdivision
was allowed.
* NB Does not apply to property to which the amendments made by
section two hundred one of Public Law 99-514 apply
* (f) (1) With respect to property which is depreciable pursuant to
section one hundred sixty-seven of the internal revenue code but is not
subject to the provisions of section one hundred sixty-eight of such
code and which is disposed of or ceases to be in qualified use prior to
the end of the taxable year in which the credit is to be taken, the
amount of the credit shall be that portion of the credit provided for in
this subdivision which represents the ratio which the months of
qualified use bear to the months of useful life. If property on which
credit has been taken is disposed of or ceases to be in qualified use
prior to the end of its useful life, the difference between the credit
taken and the credit allowed for actual use must be added back in the
year of disposition. Provided, however, if such property is disposed of
or ceases to be in qualified use after it has been in qualified use for
more than twelve consecutive years, it shall not be necessary to add
back the credit as provided in this subparagraph. The amount of credit
allowed for actual use shall be determined by multiplying the original
credit by the ratio which the months of qualified use bear to the months
of useful life. For purposes of this subparagraph, useful life of
property shall be the same as the taxpayer uses for depreciation
purposes when computing his federal income tax liability.
(2) Except with respect to that property to which subparagraph four of
this paragraph applies, with respect to three-year property, as defined
in subsection (e) of section one hundred sixty-eight of the internal
revenue code, which is disposed of or ceases to be in qualified use
prior to the end of the taxable year in which the credit is to be taken,
the amount of the credit shall be that portion of the credit provided
for in this subdivision which represents the ratio which the months of
qualified use bear to thirty-six. If property on which credit has been
taken is disposed of or ceases to be in qualified use prior to the end
of thirty-six months, the difference between the credit taken and the
credit allowed for actual use must be added back in the year of
disposition. The amount of credit allowed for actual use shall be
determined by multiplying the original credit by the ratio which the
months of qualified use bear to thirty-six.
(3) Except with respect to that property to which subparagraph four of
this paragraph applies, with respect to property subject to the
provisions of section one hundred sixty-eight of the internal revenue
code other than three-year property as defined in subsection (e) of such
section one hundred sixty-eight which is disposed of or ceases to be in
qualified use prior to the end of the taxable year in which the credit
is to be taken, the amount of the credit shall be that portion of the
credit provided for in this subdivision which represents the ratio which
the months of qualified use bear to sixty. If property on which credit
has been taken is disposed of or ceases to be in qualified use prior to
the end of sixty months, the difference between the credit taken and the
credit allowed for actual use must be added back in the year of
disposition. The amount of credit allowed for actual use shall be
determined by multiplying the original credit by the ratio which the
months of qualified use bear to sixty.
(4) With respect to any property to which section one hundred
sixty-eight of the internal revenue code applies, which is a building or
a structural component of a building and which is disposed of or ceases
to be in qualified use prior to the end of the taxable year in which the
credit is to be taken, the amount of the credit shall be that portion of
the credit provided for in this subdivision which represents the ratio
which the months of qualified use bear to the total number of months
over which the taxpayer chooses to deduct the property under the
internal revenue code. If property on which credit has been taken is
disposed of or ceases to be in qualified use prior to the end of the
period over which the taxpayer chooses to deduct the property under the
internal revenue code, the difference between the credit taken and the
credit allowed for actual use must be added back in the year of
disposition. Provided, however, if such property is disposed of or
ceases to be in qualified use after it has been in qualified use for
more than twelve consecutive years, it shall not be necessary to add
back the credit as provided in this subparagraph. The amount of credit
allowed for actual use shall be determined by multiplying the original
credit by the ratio which the months of qualified use bear to the total
number of months over which the taxpayer chooses to deduct the property
under the internal revenue code.
(5) For purposes of this paragraph, disposal or cessation of qualified
use shall not be deemed to have occurred solely by reason of the
termination or expiration of an empire zone's designation as such.
(6)(A) For purposes of this paragraph, the decertification of a
business enterprise with respect to an empire zone shall constitute a
disposal or cessation of qualified use of the property on which the
credit was taken which is located in the zone to which the
decertification applies, on the effective date of such decertification.
(B) Where a business enterprise has been decertified based on a
finding pursuant to clause one, two, or five of subdivision (a) of
section nine hundred fifty-nine of the general municipal law, the amount
required to be added back by reason of this paragraph shall be (i) the
amount of credit, with respect to the property which is disposed of or
ceases to be in qualified use, which was deducted from the taxpayer's
tax otherwise due under this article for all prior taxable years,
reduced (but not below zero) by (ii) the credit allowed for actual use.
For purposes of this subparagraph, the attribution to specific property
of credit amounts deducted from tax shall be established in accordance
with the date of placement in service of such property in the empire
zone.
(C) In no event shall the amount of the credit allowed pursuant to
this subdivision be rendered, solely by reason of clause (A) of this
subparagraph, less than the amount of the credit to which the taxpayer
would otherwise be entitled under subdivision twelve of this section.
(D) Notwithstanding any other provision of this subdivision, in the
case of a business enterprise which has been decertified, any amount of
credit allowed with respect to the property of such business enterprise
located in the zone to which the decertification applies which is
carried over pursuant to paragraph (d) of this subdivision shall not be
carried over beyond the seventh taxable year next following the taxable
year with respect to which the credit provided for in this subdivision
was allowed.
(7) For purposes of this paragraph, where a credit is allowed with
respect to an air pollution control facility on the basis of a
certificate of compliance issued pursuant to the environmental
conservation law and the certificate is revoked pursuant to subdivision
three of section 19-0309 of the environmental conservation law, such
revocation shall constitute a disposal or cessation of qualified use,
except with respect to property contained in or comprising such facility
which is described in clause (A), (B) or (C) of subparagraph (v) of
paragraph (b) of this subdivision other than as part of or comprising an
air pollution control facility. Also for purposes of this paragraph, the
use of an air pollution control facility or an industrial waste
treatment facility for the primary purpose of salvaging materials which
are usable in the manufacturing process or are marketable shall
constitute a cessation of qualified use, except with respect to property
contained in or comprising such facility which is described in clause
(A) or (C) of subparagraph (v) of paragraph (b) of this subdivision.
(8) Except as provided in this subparagraph, this paragraph shall not
apply to a credit allowed by this subdivision to a taxpayer that is a
partner in a partnership in the case of manufacturing property;
provided, at the time such property was placed in service by such
partnership in an empire zone the basis for federal income tax purposes
of such property (or a project that includes such property) equaled or
exceeded three hundred million dollars and such partner owned its
partnership interest for at least three years from the date such
property was placed in service. If such property ceases to be in
qualified use after it is placed in service, this paragraph shall apply
to such partner in the year such property ceases to be in qualifying
use.
* NB Applies to property to which the amendments made by section two
hundred one of Public Law 99-514 apply
12-C. Empire zone employment incentive credit (EDZ-EIC). (a) Where a
taxpayer is allowed a credit under subdivision twelve-B of this section,
the taxpayer shall be allowed a credit for each of the three years next
succeeding the taxable year for which the credit under such subdivision
twelve-B is allowed, with respect to such property, whether or not
deductible in such taxable year or in subsequent taxable years pursuant
to paragraph (d) of such subdivision twelve-B, of thirty percent of the
credit allowable under such subdivision twelve-B; provided, however,
that the credit allowable under this subdivision for any taxable year
shall only be allowed if the average number of employees employed by the
taxpayer in the empire zone, designated pursuant to article eighteen-B
of the general municipal law, in which such property is located during
such taxable year is at least one hundred one percent of the average
number of employees employed by the taxpayer in such empire zone or,
where applicable, in the geographic area subsequently constituting such
zone, during the taxable year immediately preceding the taxable year for
which the credit under such subdivision twelve-B is allowed and
provided, further, that if the taxpayer was not subject to tax and did
not have a taxable year immediately preceding the taxable year for which
the credit under subdivision twelve-B of this section is allowed, the
credit allowable under this subdivision for any taxable year shall be
allowed if the average number of employees employed in such empire zone
in such taxable year is at least one hundred one percent of the average
number of such employees during the taxable year in which the credit
under such subdivision twelve-B is allowed.
(b) The average number of employees employed in an empire zone, or,
where applicable, in the geographic area subsequently constituting such
zone, in a taxable year shall be computed by ascertaining the number of
such employees within such zone, or, where applicable, in the geographic
area subsequently constituting such zone, except general executive
officers, employed by the taxpayer on the thirty-first day of March, the
thirtieth day of June, the thirtieth day of September and the
thirty-first day of December in the taxable year, by adding together the
number of employees ascertained on each of such dates and dividing the
sum so obtained by the number of such above-mentioned dates occurring
within the taxable year. For the purposes of this subdivision, the term
"employees" and the term "general executive officers" shall mean the
same as in subparagraph three of paragraph (a) of subdivision three of
this section.
(c) In no event shall the credit herein provided for be allowed in an
amount which will reduce the tax payable to less than the amount
prescribed in paragraph (d) of subdivision one of this section.
Provided, however, that if the amount of credit allowable under this
subdivision for any taxable year reduces the tax to such amount, any
amount of credit not deductible in such taxable year may be carried over
to the following year or years and may be deducted from the taxpayer's
tax for such year or years. In lieu of such carryover, any such
taxpayer, which is deemed to be a new business under paragraph five of
subdivision (j) of section fourteen of this chapter, may elect, on its
report for its taxable year with respect to which such credit is
allowed, to treat fifty percent of the amount of such carryover as an
overpayment of tax to be credited or refunded in accordance with the
provisions of section ten hundred eighty-six of this chapter. Provided,
however, the provisions of subsection (c) of section ten hundred
eighty-eight of this chapter notwithstanding, no interest shall be paid
thereon.
12-D. Employment Incentive Credit (EIC). (a) (i) Where a taxpayer is
allowed a credit under subdivision twelve of this section, other than at
the optional rate applicable to research and development property, with
respect to property the acquisition, construction, reconstruction or
erection of which commenced on or after the first day of January,
nineteen hundred eighty-seven, the taxpayer shall be allowed a credit
for each of the two years next succeeding the taxable year for which the
credit under such subdivision twelve is allowed with respect to such
property, whether or not deductible in such taxable year or in
subsequent taxable years pursuant to paragraph (e) of such subdivision
twelve. Provided, however, that the credit allowable under this
subdivision for any taxable year shall be allowed only if the average
number of employees during such taxable year is at least one hundred one
percent of the average number of employees during the employment base
year. The employment base year shall be the taxable year immediately
preceding the taxable year for which the credit under such subdivision
twelve is allowed except that if the taxpayer was not subject to tax and
did not have a taxable year immediately preceding the taxable year for
which the credit under such subdivision twelve of this section is
allowed, the employment base year shall be the taxable year in which the
credit under such subdivision twelve is allowed.
(ii) the amount of the credit provided for in this subdivision shall
be computed as follows:
(A) Where the credit allowed under subdivision twelve of this section
was allowed for a taxable year beginning in nineteen hundred
eighty-seven, nineteen hundred eighty-eight or nineteen hundred
eighty-nine, the amount of the credit allowed under this subdivision
shall equal the sum of two percent of the first five hundred million
dollars of the investment credit base and two and one-half percent of
the investment credit base in excess of five hundred million dollars.
(B) Where the credit allowed under subdivision twelve of this section
was allowed for a taxable year beginning in nineteen hundred ninety, the
amount of the credit allowed under this subdivision shall be as set
forth in the following table:
Average number of employees Credit allowed under
during the taxable year this subdivision
expressed as a percentage of expressed as a
average number of employees percentage of the applicable
in employment base year: investment credit base:
Less than 101.5% 2%
at least 101.5% 2.5%
(C) Where the credit allowed under subdivision twelve of this section
was allowed for a taxable year beginning after nineteen hundred ninety,
the amount of the credit allowed under this subdivision shall be as set
forth in the following table:
Average number of employees Credit allowed under
during the taxable year this subdivision
expressed as a percentage of expressed as a
average number of employees percentage of the applicable
in employment base year: investment credit base:
Less than 102% 1.5%
at least 102% and less
than 103% 2%
at least 103% 2.5%
(b) The average number of employees in a taxable year shall be
computed by ascertaining the number of employees within the state,
except general executive officers, employed by the taxpayer on the
thirty-first day of March, the thirtieth day of June, the thirtieth day
of September and the thirty-first day of December in the taxable year,
by adding together the number of employees ascertained on each of such
dates and dividing the sum so obtained by the number of such above
mentioned dates occurring within the taxable year. For the purposes of
this subdivision, the term "employees within the state, except general
executive officers" shall mean the same as in subparagraph three of
paragraph (a) of subdivision three of this section; provided, however,
except with respect to the employment base year, there shall be excluded
therefrom any employee with respect to whom a credit provided for under
subdivision nineteen of this section is claimed, for the taxable year,
based on employment within a zone equivalent area designated as such
pursuant to article eighteen-B of the general municipal law.
* (c) In no event shall the credit herein provided for be allowed in
an amount which will reduce the tax payable to less than the higher of
the amounts prescribed in paragraphs (c) and (d) of subdivision one of
this section. However, if the amount of credit allowable under this
subdivision for any taxable year reduces the tax to such amount, any
amount of credit not deductible in such taxable year may be carried over
to the fifteen taxable years immediately following such taxable year and
may be deducted from the taxpayer's tax for such year or years.
* NB Applicable to taxable years beginning on or after January 1, 1997
12-E. Qualified emerging technology company employment credit. (a) A
taxpayer shall be allowed a credit, to be computed as hereinafter
provided, against the tax imposed by this article, provided:
(1) the taxpayer is a qualified emerging technology company pursuant
to the provisions of section thirty-one hundred two-e of the public
authorities law; and
(2) the average number of individuals employed full time by the
taxpayer in New York state during the taxable year is at least one
hundred one percent of the taxpayer's base year employment. For the
purposes of this subdivision, "base year employment" means the average
number of individuals employed full-time by the taxpayer in the state
during the three taxable years immediately preceding the first taxable
year in which the credit is claimed. Where the taxpayer provided
full-time employment within the state during only a portion of such
three-year period, then the first effective date for the company to take
advantage of this credit shall be the next year following the first full
taxable year that the company had full-time employment in New York
state. For the purposes of this paragraph the term "three years" shall
be deemed to refer instead to the prior year's full-time employment
after the first year and the average of the first eight quarters of
employment after the first two taxable years in New York state.
(b) The credit shall be allowed only in the first taxable year in
which the credit is claimed and in each of the next two taxable years,
provided that the conditions of paragraph (a) of this subdivision are
satisfied in each taxable year.
(c) For the purposes of this subdivision, average number of
individuals employed full-time shall be computed by adding the number of
such individuals employed by the taxpayer at the end of each quarter
during each taxable year or other applicable period and dividing the sum
so obtained by the number of such quarters occurring within such taxable
year or other applicable period; provided however, except that in
computing base year employment, there shall be excluded therefrom any
employee with respect to whom a credit provided for under subdivision
nineteen of this section is claimed for the taxable year.
(d) The amount of the credit shall equal the product of one thousand
dollars times the number of individuals employed full-time by the
taxpayer in the taxable year that are in excess of one hundred percent
of the taxpayer's base year employment.
(e) The credit allowed under this subdivision for any taxable year
shall not reduce the tax due for such year to less than the higher of
the amounts prescribed in paragraphs (c) and (d) of subdivision one of
this section. However, if the amount of credit allowed under this
subdivision for any taxable year reduces the tax to such amount, any
amount of credit thus not deductible in such taxable year shall be
treated as an overpayment of tax to be credited or refunded in
accordance with the provisions of section ten hundred eight-six of this
chapter. Provided, however, the provisions of subsection (c) of section
ten hundred eighty-eight of this chapter notwithstanding, no interest
shall be paid thereon.
12-F. Qualified emerging technology company capital tax credit. (a) A
taxpayer shall be allowed a credit against the tax imposed by this
article. The amount of the credit shall be equal to one of the following
percentages, per each qualified investment in a qualified emerging
technology company as defined in section thirty-one hundred two-e of the
public authorities law, made during the taxable year, and certified by
the commissioner, either:
(1) ten percent of qualified investments in qualified emerging
technology companies, except for investments made by or on behalf of an
owner of the business, including, but not limited to, a stockholder,
partner or sole proprietor, or any related person, as defined in
subparagraph (C) of paragraph three of subsection (b) of section four
hundred sixty-five of the internal revenue code, and provided, however,
that the taxpayer certifies to the commissioner that the qualified
investment will not be sold, transferred, traded, or disposed of during
the four years following the year in which the credit is first claimed;
or
(2) twenty percent of qualified investments in qualified emerging
technology companies, except for investments made by or on behalf of an
owner of the business, including, but not limited to, a stockholder,
partner or sole proprietor, or any related person, as defined in
subparagraph (C) of paragraph three of subsection (b) of section four
hundred sixty-five of the internal revenue code, and provided, however,
that the taxpayer certifies to the commissioner that the qualified
investment will not be sold, transferred, traded, or disposed of during
the nine years following the year in which the credit is first claimed.
"Qualified investment" means the contribution of property to a
corporation in exchange for original issue capital stock or other
ownership interest, the contribution of property to a partnership in
exchange for an interest in the partnership, and similar contributions
in the case of a business entity not in corporate or partnership form in
exchange for an ownership interest in such entity.
The total amount of credit allowable to a taxpayer under this provision
for all years, taken in the aggregate, shall not exceed one hundred
fifty thousand dollars in the case of investments made pursuant to
subparagraph one of this paragraph and shall not exceed three hundred
thousand dollars in the case of investments made pursuant to
subparagraph two of this paragraph.
(b) In no event shall the credit and carryover of such credit allowed
under this subdivision for any taxable year, in the aggregate, reduce
the tax due for such year to less than the higher of the amounts
prescribed in paragraphs (c) and (d) of subdivision one of this section.
However, if the amount of credit or carryovers of such credit, or both,
allowed under this subdivision for any taxable year reduces the tax to
such amount, or if any part of the credit or carryovers of such credit
may not be deducted from the tax otherwise due by reason of the final
sentence of this paragraph, any amount of credit or carryovers of such
credit thus not deductible in such taxable year may be carried over to
the following year or years and may be deducted from the tax for such
year or years. In addition, the amount of such credit, and carryovers of
such credit to the taxable year, deducted from the tax otherwise due may
not, in the aggregate, exceed fifty percent of the tax imposed under
section two hundred nine of this article computed without regard to any
credit provided for by this section.
(c) (1) Where a taxpayer sells, transfers or otherwise disposes of
corporate stock, a partnership interest or other ownership interest
arising from the making of a qualified investment which was the basis,
in whole or in part, for the allowance of the credit provided for under
subparagraph one of paragraph (a) of this subdivision, or where an
investment which was the basis for such allowance is, in whole or in
part, recovered by such taxpayer, and such disposition or recovery
occurs during the taxable year or within forty-eight months from the
close of the taxable year with respect to which such credit is allowed,
the taxpayer shall add back, with respect to the taxable year in which
the disposition or recovery described above occurred, the required
portion of the credit originally allowed.
(2) Where a taxpayer sells, transfers or otherwise disposes of
corporate stock, a partnership interest or other ownership interest
arising from the making of a qualified investment which was the basis,
in whole or in part, for the allowance of the credit provided for under
subparagraph two of paragraph (a) of this subdivision, or where an
investment which was the basis for such allowance is in any manner, in
whole or in part, recovered by such taxpayer, and such disposition or
recovery occurs during the taxable year or within one hundred eight
months from the close of the taxable year with respect to which such
credit is allowed, the taxpayer shall add back, with respect to the
taxable year in which the disposition or recovery described in
subparagraph one of this paragraph occurred the required portion of the
credit originally allowed.
(3) The required portion of the credit originally allowed shall be the
product of (A) the portion of such credit attributable to the property
disposed of and (B) the applicable percentage.
(4) The applicable percentage shall be:
(A) for credits allowed pursuant to subparagraph one of paragraph (a)
of this subdivision:
(i) one hundred percent, if the disposition or recovery occurs within
the taxable year with respect to which the credit is allowed or within
twelve months of the end of such taxable year,
(ii) seventy-five percent, if the disposition or recovery occurs more
than twelve but not more than twenty-four months after the end of the
taxable year with respect to which the credit is allowed,
(iii) fifty percent, if the disposition or recovery occurs more than
twenty-four months but not more than thirty-six months after the end of
the taxable year with respect to which the credit is allowed, or
(iv) twenty-five percent, if the disposition or recovery occurs more
than thirty-six months but not more than forty-eight months after the
end of the taxable year with respect to which the credit is allowed; or
(B) for credits allowed pursuant to subparagraph two of paragraph (a)
of this subdivision:
(i) one hundred percent, if the disposition or recovery occurs within
the taxable year with respect to which the credit is allowed or within
twelve months of the end of such taxable year,
(ii) eighty percent, if the disposition or recovery occurs more than
twelve but not more than forty-eight months after the end of the taxable
year with respect to which the credit is allowed,
(iii) sixty percent, if the disposition or recovery occurs more than
forty-eight months but not more than seventy-two months after the end of
the taxable year with respect to which the credit is allowed,
(iv) forty percent, if the disposition or recovery occurs more than
seventy-two months but not more than ninety-six months after the end of
the taxable year with respect to which the credit is allowed, or
(v) twenty percent, if the disposition or recovery occurs more than
ninety-six months but not more than one hundred eight months after the
end of the taxable year with respect to which the credit is allowed.
12-G. Qualified emerging technology company facilities, operations and
training credit. (a) A taxpayer that is a qualified emerging technology
company pursuant to the provisions of section thirty-one hundred two-e
(and specifically for the activities referenced in paragraph (b) of
subdivision one of such section thirty-one hundred two-e) of the public
authorities law, and that meets the eligibility requirements in
paragraph (b) of this subdivision, shall be allowed a credit against the
tax imposed by this article. The amount of credit shall be equal to the
sum of the amounts specified in paragraphs (c), (d), and (e) of this
subdivision subject to the limitations in paragraph (f) of this
subdivision.
(b) An eligible taxpayer shall (i) have no more than one hundred
full-time employees, of which at least seventy-five percent are employed
in New York state, (ii) have a ratio of research and development funds
to net sales, as referred to in section thirty-one hundred two-e of the
public authorities law, which equals or exceeds six percent during its
taxable year, and (iii) have gross revenues, along with the gross
revenues of its affiliates and related members, not exceeding twenty
million dollars for the taxable year immediately preceding the year the
taxpayer is allowed a credit under this subdivision. For purposes of
this paragraph, the term "related member" shall have the same meaning as
set forth in clauses (A) and (B) of subparagraph one of paragraph (o) of
subdivision nine of section two hundred eight of this article, and the
term "affiliates" shall mean those corporations that are members of the
same affiliated group (as defined in section fifteen hundred four of the
internal revenue code) as the taxpayer.
(c) An eligible taxpayer shall be allowed a credit for eighteen per
centum of the cost or other basis for federal income tax purposes of
research and development property as defined in paragraph (b) of
subdivision twelve of this section that is acquired by the taxpayer by
purchase as defined in section 179(d) of the internal revenue code and
placed in service during the taxable year. Provided, however, for the
purposes of this paragraph only, an eligible taxpayer shall be allowed a
credit for such percentage of the (i) cost or other basis for federal
income tax purposes for property used in the testing or inspection of
materials and products,
(ii) the costs or expenses associated with quality control of the
research and development,
(iii) fees for use of sophisticated technology facilities and
processes,
(iv) fees for the production or eventual commercial distribution of
materials and products resulting from the activities of an eligible
taxpayer as long as such activities fall under the activities listed in
paragraph (b) of subdivision one of section thirty-one hundred two-e of
the public authorities law. The costs, expenses and other amounts for
which a credit is allowed and claimed under this paragraph shall not be
used in the calculation of any other credit allowed under this article.
(d) An eligible taxpayer shall be allowed a credit for nine per centum
of "qualified research expenses" paid or incurred by the taxpayer in the
taxable year. "Qualified research expenses" shall mean expenses
associated with in-house research and processes, and costs associated
with the dissemination of the results of the products that directly
result from such research and development activities; provided, however,
that such costs shall not include advertising or promotion through
media. In addition, costs associated with the preparation of patent
applications, patent application filing fees, patent research fees,
patent examinations fees, patent post allowance fees, patent maintenance
fees, and grant application expenses and fees shall be eligible for such
credit. In no case shall the credit allowed under this paragraph apply
to expenses for litigation or the challenge of another entity's
intellectual property rights, or for contract expenses involving outside
paid consultants.
(e) An eligible taxpayer shall be allowed a credit for qualified
high-technology training expenditures as described in this paragraph
paid or incurred by the taxpayer. (i) The amount of credit shall be one
hundred percent of the training expenses described in subparagraph (iii)
of this paragraph, subject to a limitation of no more than four thousand
dollars per employee per year for such training expenses.
(ii) Qualified high-technology training shall include a course or
courses taken and satisfactorily completed by an employee of the
taxpayer at an accredited, degree granting post-secondary college or
university in New York state that (A) directly relates to the activities
referred to in paragraph (b) of subdivision one of section thirty-one
hundred two-e of the public authorities law, and
(B) is intended to upgrade, retrain or improve the productivity or
theoretical awareness of the employee. Such course or courses may
include, but are not limited to, instruction or research relating to
techniques, meta, macro, or micro-theoretical or practical knowledge
bases or frontiers, or ethical concerns related to such activities. Such
course or courses shall not include classes in the disciplines of
management, accounting or the law or any class designed to fulfill the
discipline specific requirements of a degree program at the associate,
baccalaureate, graduate or professional level of these disciplines.
Satisfactory completion of a course or courses shall mean the earning
and granting of credit or equivalent unit, with the attainment of a
grade of "B" or higher in a graduate level course or courses, a grade of
"C" or higher in an undergraduate level course or courses, or a similar
measure of competency for a course that is not measured according to a
standard grade formula.
(iii) Qualified high-technology training expenditures shall include
expenses for tuition and mandatory fees, software required by the
institution, fees for textbooks or other literature required by the
institution offering the course or courses, minus applicable
scholarships and tuition or fee waivers not granted by the taxpayer or
any affiliates of the taxpayer, that are paid or reimbursed by the
taxpayer. Qualified high-technology expenditures do not include room and
board, computer hardware or software not specifically assigned for such
course or courses, late-charges, fines or membership dues and similar
expenses. Such qualified expenditures shall not be eligible for the
credit provided by this section unless the employee for whom the
expenditures are disbursed is continuously employed by the taxpayer in a
full-time, full-year position primarily located at a qualified site
during the period of such coursework and lasting through at least one
hundred eighty days after the satisfactory completion of the qualifying
course-work. Qualified high-technology training expenditures shall not
include expenses for in-house or shared training outside of a New York
state higher education institution or the use of consultants outside of
credit granting courses, whether such consultants function inside of
such higher education institution or not.
(iv) If a taxpayer relocates from an academic business incubator
facility partnered with an accredited post-secondary education
institution located within New York state, which provides space and
business support services to taxpayers, to another site, the credit
provided in this section shall be allowed for all expenditures
referenced in subparagraph (iii) of this paragraph paid or incurred in
the two preceding taxable years that the taxpayer was located in such an
incubator facility for employees of the taxpayer who also relocate from
said incubator facility to such New York site and are employed and
primarily located by the taxpayer in New York. Such expenditures in the
two preceding years shall be added to the amounts otherwise qualifying
for the credit provided by this subdivision that were paid or incurred
in the taxable year that the taxpayer relocates from such a facility.
Such expenditures shall include expenses paid for an eligible employee
who is a full-time, full-year employee of said taxpayer during the
taxable year that the taxpayer relocated from an incubator facility
notwithstanding (i) that such employee was employed full or part-time as
an officer, staff-person or paid intern of the taxpayer when such
taxpayer was located at such incubator facility or (ii) that such
employee was not continuously employed when such taxpayer was located at
the incubator facility during the one hundred eighty day period referred
to in subparagraph (iii) of this paragraph, provided such employee
received wages or equivalent income for at least seven hundred fifty
hours during any twenty-four month period when the taxpayer was located
at the incubator facility. Such expenditures shall include payments made
to such employee after the taxpayer has relocated from the incubator
facility for qualified expenditures if such payments are made to
reimburse an employee for expenditures paid by the employee during such
two preceding years. The credit provided under this subparagraph shall
be allowed in any taxable year that the taxpayer qualifies as an
eligible taxpayer.
(v) For purposes of this subdivision the term "academic year" shall
mean the annual period of sessions of a post-secondary college or
university.
(vi) For the purposes of this subdivision the term "academic incubator
facility" shall mean a facility providing low-cost space, technical
assistance, support services and educational opportunities, including
but not limited to central services provided by the manager of the
facility to the tenants of the facility, to an entity located in New
York state. Such entity's primary activity must be an activity described
in paragraph (b) of subdivision one of section thirty-one hundred two-e
of the public authorities law, and such entity must be in the formative
stage of development. The academic incubator facility and the entity
must act in partnership with an accredited post-secondary college or
university located in New York state. An academic incubator facility's
mission shall be to promote job creation, entrepreneurship, technology
transfer, and provide support services to incubator tenants, including,
but not limited to, business planning, management assistance,
financial-packaging, linkages to financing services, and coordinating
with other sources of assistance.
(f) An eligible taxpayer may claim credits under this subdivision for
four consecutive taxable years, except, if a taxpayer is located in an
academic incubator facility and relocates within New York state to a
nonacademic incubator site, then the taxpayer (i) may make a revocable
election to defer the credit provided under this subdivision to the
first taxable year beginning after the taxpayer relocates from an
academic incubator facility, and (ii) shall be eligible for such credit
for five consecutive taxable years. In no case shall the credit allowed
by this subdivision to a taxpayer exceed two hundred and fifty thousand
dollars per year.
(g) The credit allowed under this subdivision for any taxable year
shall not reduce the tax due for such year to less than the higher of
the amounts prescribed in paragraphs (c) and (d) of subdivision one of
this section. However, if the amount of credit allowed under this
subdivision for any taxable year reduces the tax to such amount, any
amount of credit not deductible in such taxable year shall be treated as
an overpayment of tax to be credited or refunded in accordance with the
provisions of section ten hundred eighty-six of this chapter. Provided,
however, the provisions of subsection (c) of section ten hundred
eighty-eight of this chapter notwithstanding, no interest shall be paid
thereon.
(h) The credit allowed under this subdivision shall not be applicable
for taxable years beginning on or after January first, two thousand
twelve.
* 13. (a) So long as the taxation procedures relating to a DISC
provided in subparagraph (B) of paragraph (i) of subdivision nine of
section two hundred eight of this article are in effect and not rendered
invalid any taxpayer which during the taxable year being reported was a
stockholder in any such DISC shall be allowed a DISC export credit, to
be computed as hereinafter provided, against the tax imposed by this
article. The amount of the credit shall be computed separately for each
such DISC, based upon its operations during its annual reporting period
ending during the current taxable year of such stockholder, as follows:
(1) ascertaining the amount, if any, of such taxpayer's attributable
share of the total current earnings and profits earned by such DISC for
the reporting year which were included in its accumulated DISC income
account pursuant to subsection (a) of section nine hundred ninety-six of
the internal revenue code of nineteen hundred fifty-four,
(2) ascertaining a percentage by (i) totaling the gross receipts from
the sale, lease, rental or other disposition of export property (as
defined under subsection (c) of section nine hundred ninety-three of the
internal revenue code of nineteen hundred fifty-four) of the taxpayer by
or to such DISC, and (ii) totaling such gross receipts from such export
property of the taxpayer shipped from a regular place of business of the
taxpayer within this state by or to such DISC and then (iii) dividing
the total developed in (ii) above by that developed in (i) above
(provided, however, for the purposes of this subparagraph, the tax
commission may require such gross receipts to be computed on a similar
basis for all such export property to properly reflect the percentage of
such gross receipts attributable to export property shipped from a
regular place of business of the taxpayer within this state),
(3) multiplying the amount ascertained in subparagraph one of this
paragraph by the percentage ascertained in subparagraph two of this
paragraph,
(4) ascertaining the amount of the taxpayer's taxable income as
determined in subparagraphs one, two and three of this paragraph that is
eligible for credit by multiplying the product ascertained in the
preceding subparagraph by the taxpayer's business allocation percentage
determined as provided in paragraph (a) of subdivision three of this
section,
(5) the amount of DISC export credit attributable to the operations of
each such DISC is then found by multiplying seventy percent of the
taxpayer's taxable income that is eligible for credit, as computed in
the preceding subparagraph, by the rate of tax applying to the taxpayer,
as provided in subdivision one of this section,
(6) the taxpayer's total DISC export credit is the sum of the DISC
export credits attributable to each DISC that qualifies for tax
exemption under paragraph (i) of subdivision nine of section two hundred
eight of this article, in which it was a stockholder during the taxable
year being reported.
(b) The credit allowed under this subdivision for any taxable year
shall not reduce the tax due for such year to less than the minimum
fixed by clause four of paragraph (a) of subdivision one of this
section; nor may any unused credit be carried over to any following
year.
* NB Applies to taxable years prior to December 31, 1986
* 13. Allowance of minimum tax credit. (a) There shall be allowed as a
credit against the tax imposed by this article for any taxable year an
amount equal to the minimum tax credit for such year as provided in
paragraph (b) of this subdivision. Provided, however, such credit shall
not be allowed against a tax which includes a component computed under
paragraph (b) or (c) of subdivision one of this section.
(b) For purposes of paragraph (a) of this subdivision, the minimum tax
credit for any taxable year is the excess (if any) of--
(1) the adjusted minimum tax imposed for all prior taxable years
beginning after December thirty-first, nineteen hundred eighty-nine,
over
(2) the amount allowable as a credit under this paragraph for such
prior taxable years which was deducted from the taxpayer's tax otherwise
due under this article for such years.
(c) For purposes of this subdivision:
(1) The term "minimum tax" means the amount prescribed by subparagraph
(ii) of paragraph (c) of subdivision one of this section.
(2) The "adjusted minimum tax" for any taxable year is
(A) the excess (if any) of the amount of the minimum tax for such
taxable year over the highest of the amounts prescribed in paragraphs
(a), (b) and (d) of subdivision one of this section for such year,
reduced by
(B) the amount which would be the excess (if any) of (i) the minimum
tax for such taxable year if the only adjustments and items of tax
preference taken into account were the item of tax preference provided
for in paragraph one of subsection (a) of section fifty-seven of the
internal revenue code, relating to depletion, and if such minimum tax
were computed without regard to subparagraph three of paragraph (a) of
subdivision eight-B of section two hundred eight of this article in the
case of any such taxable year beginning after nineteen hundred
eighty-nine, and without regard to subparagraph four of such paragraph
in the case of any such taxable year beginning after nineteen hundred
ninety-three, over (ii) the highest of the amounts prescribed in
paragraphs (a), (b) and (d) of subdivision one of this section for such
year.
(d) In no event shall the credit allowed under this subdivision for
any taxable year reduce the tax due for such year to less than the sum
of (1) the highest of the amounts prescribed in paragraphs (b), (c) and
(d) of subdivision one of this section and (2) the amount prescribed in
paragraph (e) of subdivision one of this section.
(e) Transition rule for allowance of net operating loss deduction. (1)
In determining the credit under this subdivision for any taxable year
beginning after nineteen hundred ninety-three and before nineteen
hundred ninety-nine, the adjusted minimum tax imposed for prior taxable
years under subparagraph one of paragraph (b) of this subdivision shall
be increased by an amount not to exceed twenty percent of the
pre-nineteen hundred ninety-four net operating loss component.
(2) In determining the credit under this subdivision for any taxable
year beginning after nineteen hundred ninety-eight, the adjusted minimum
tax imposed for prior taxable years under subparagraph one of paragraph
(b) of this subdivision shall be increased by any amount of the
pre-nineteen hundred ninety-four net operating loss component which was
not deducted from the taxpayer's tax otherwise due under this article
for any prior taxable year.
(3) The pre-nineteen hundred ninety-four net operating loss component
is the sum of the part of the adjusted minimum tax for each taxable year
beginning after nineteen hundred eighty-nine and before nineteen hundred
ninety-four which is attributable to the net operating loss deduction
disallowed by reason of the modification under subparagraph three of
paragraph (a) of subdivision eight-B of section two hundred eight of
this article, determined as if paragraph (c) of this subdivision, as
amended by the chapter of the laws of nineteen hundred ninety-four which
added this paragraph, were in effect for such years.
* NB Applies to taxable years beginning after December 31, 1986
17. Credit for the special additional mortgage recording tax. (a) A
taxpayer shall be allowed a credit, to be credited against the tax
imposed by this article, equal to the amount of the special additional
mortgage recording tax paid by the taxpayer pursuant to the provisions
of subdivision one-a of section two hundred fifty-three of this chapter
on mortgages recorded on and after January first, nineteen hundred
seventy-nine. Provided, however, no credit shall be allowed with respect
to a mortgage of real property principally improved or to be improved by
one or more structures containing in the aggregate not more than six
residential dwelling units, each dwelling unit having its own separate
cooking facilities, where the real property is located in one or more of
the counties comprising the metropolitan commuter transportation
district and where the mortgage is recorded on or after May first,
nineteen hundred eighty-seven. Provided further, however, no credit
shall be allowed with respect to a mortgage of real property principally
improved or to be improved by one or more structures containing in the
aggregate not more than six residential dwelling units, each dwelling
unit having its own separate cooking facilities, where the real property
is located in the county of Erie and where the mortgage is recorded on
or after May first, nineteen hundred eighty-seven.
* (b) In no event shall the credit herein provided for be allowed in
an amount which will reduce the tax payable to less than the minimum
fixed by clause four of paragraph (a) of subdivision one of this
section. If, however, the amount of credit allowable under this
subdivision for any taxable year reduces the tax to such amount, any
amount of credit not deductible in such taxable year may be carried over
to the following year or years and may be deducted from the taxpayer's
tax for such year or years. Provided, however, in the case of any such
credit attributable to special additional mortgage recording tax which
is due and paid in any taxable year beginning before January first,
nineteen hundred eighty-six, pursuant to the provisions of subdivision
one-a of section two hundred fifty-three of this chapter, with respect
to a mortgage of real property principally improved or to be improved by
one or more structures containing in the aggregate not more than six
residential dwelling units, each dwelling unit having its own separate
cooking facilities, such credit shall not be carried over to taxable
years beginning on or after January first, nineteen hundred eighty-six.
For taxable years beginning on or after such date, and before January
first, nineteen hundred ninety, in lieu of carrying over, to the
following year or years, the unused portion of credits attributable to
special additional mortgage recording tax with respect to such
mortgages, the taxpayer may elect to treat such unused portion as an
overpayment of tax to be credited or refunded in accordance with the
provisions of section ten hundred eighty-six of this chapter except that
no interest shall be paid on such overpayment.
* NB Applies to taxable years prior to December 31, 1986
* (b) In no event shall the credit herein provided for be allowed in
an amount which will reduce the tax payable to less than the higher of
the amounts prescribed in paragraphs (c) and (d) of subdivision one of
this section. If, however, the amount of credit allowable under this
subdivision for any taxable year reduces the tax to such amount, any
amount of credit not deductible in such taxable year may be carried over
to the following year or years and may be deducted from the taxpayer's
tax for such year or years. Provided, however, in the case of any such
credit attributable to special additional mortgage recording tax which
is due and paid in any taxable year beginning before January first,
nineteen hundred eighty-six, pursuant to the provisions of subdivision
one-a of section two hundred fifty-three of this chapter, with respect
to a mortgage of real property principally improved or to be improved by
one or more structures containing in the aggregate not more than six
residential dwelling units, each dwelling unit having its own separate
cooking facilities, such credit shall not be carried over to taxable
years beginning on or after January first, nineteen hundred eighty-six.
For taxable years beginning on or after January first, nineteen hundred
eighty-six and before January first, nineteen hundred ninety, and for
taxable years beginning on or after January first, nineteen hundred
ninety-four, in lieu of carrying over, to the following year or years,
the unused portion of credits attributable to special additional
mortgage recording tax with respect to such mortgages, which is due and
paid in any of such taxable years, the taxpayer may elect to treat such
unused portion as an overpayment of tax to be credited or refunded in
accordance with the provisions of section ten hundred eighty-six of this
chapter except that no interest shall be paid on such overpayment.
* NB Applies to taxable years beginning after December 31, 1986
18. Research and development tax credit.
* (a) A taxpayer shall be allowed a credit against the tax imposed by
this article. The amount of the credit shall be ten per cent of the cost
or other basis for federal income tax purposes of tangible personal
property, and other tangible property, including buildings and
structural components of buildings, described in paragraph (b) of this
subdivision; acquired, constructed or reconstructed, or erected after
June thirtieth, nineteen hundred eighty-two.
* NB Applies to taxable years prior to December 31, 1986
* (a) For taxable years commencing prior to January first, nineteen
hundred eighty-seven, a taxpayer shall be allowed a credit against the
tax imposed by this article. The amount of the credit shall be ten per
cent of the cost or other basis for federal income tax purposes of
tangible personal property, and other tangible property, including
buildings and structural components of buildings, described in paragraph
(b) of this subdivision; acquired, constructed or reconstructed, or
erected after June thirtieth, nineteen hundred eighty-two.
* NB Applies to taxable years beginning after December 31, 1986
* (b) A credit shall be allowed under this section with respect to
tangible personal property and other tangible property, including
buildings and structural components of buildings which are: depreciable
pursuant to section one hundred sixty-seven of the internal revenue code
or recovery property with respect to which a deduction is allowable
under section one hundred sixty-eight of the internal revenue code, have
a useful life of four years or more, are acquired by purchase as defined
in section one hundred seventy-nine (d) of the internal revenue code,
have a situs in this state and are used or are to be used for purposes
of research and development in the experimental or laboratory sense.
Such purposes shall not be deemed to include the ordinary testing or
inspection of materials or products for quality control, efficiency
surveys, management studies, consumer surveys, advertising, promotions,
or research in connection with literary, historical or similar projects.
* NB Does not apply to property to which the amendments made by
section two hundred one of Public Law 99-514 apply
* (b) A credit shall be allowed under this section with respect to
tangible personal property and other tangible property, including
buildings and structural components of buildings which are: depreciable
pursuant to section one hundred sixty-seven of the internal revenue
code, have a useful life of four years or more, are acquired by purchase
as defined in section one hundred seventy-nine (d) of the internal
revenue code, have a situs in this state and are used or are to be used
for purposes of research and development in the experimental or
laboratory sense. Such purposes shall not be deemed to include the
ordinary testing or inspection of materials or products for quality
control, efficiency surveys, management studies, consumer surveys,
advertising, promotions, or research in connection with literary,
historical or similar projects.
* NB Applies to property to which the amendments made by section two
hundred one of public Law 99-514 apply
(c) A taxpayer shall not be allowed a credit under this subdivision
with respect to any property described in paragraphs (a) and (b) of this
subdivision, if a deduction is taken for such property under
subparagraph three of paragraph (e) of subdivision three of this
section, or if a credit is taken pursuant to either subdivision eleven
or twelve of this section.
(d) A taxpayer shall not be allowed a credit under this subdivision
with respect to tangible personal property and other tangible property,
including buildings and structural components of buildings, which it
leases to any other person or corporation. For purposes of the preceding
sentence, any contract or agreement to lease or rent or for a license to
use such property shall be considered a lease. Provided, however, in
determining whether a taxpayer shall be allowed a credit under this
subdivision with respect to such property, any election made with
respect to such property pursuant to the provisions of paragraph eight
of subsection (f) of section one hundred sixty-eight of the internal
revenue code, as such paragraph was in effect for agreements entered
into prior to January first, nineteen hundred eighty-four, shall be
disregarded.
* (e) The credit allowed under this subdivision for any taxable year
shall not reduce the tax due for such year to less than the minimum
fixed by clause four of paragraph (a) of subdivision one of this
section. However, if the amount of credit allowable under this
subdivision for any taxable year reduces the tax to the minimum fixed by
clause four of paragraph (a) of subdivision one of this section, any
amount of credit not deductible in such taxable year may be carried over
to the following year or years, and may be deducted from the taxpayer's
tax for such year or years.
* NB Applies to taxable years prior to December 31, 1986
* (e) (1) The credit allowed under this subdivision for any taxable
year shall not reduce the tax due for such year to less than the higher
of the amounts prescribed in paragraphs (c) and (d) of subdivision one
of this section. However, if the amount of credit allowable under this
subdivision for any taxable year reduces the tax to such amount, any
amount of credit not deductible in such taxable year may be carried over
to the following year or years, and may be deducted from the taxpayer's
tax for such year or years, but in no event shall such credit be carried
over to taxable years commencing on or after January first, nineteen
hundred ninety-four.
(2) Notwithstanding the provisions of subparagraph one of this
paragraph, a taxpayer may not carry over any amount of credit or credits
allowed under this subdivision to a taxable year during which a
corporate acquisition with respect to which it was a target corporation
occurred ("acquisition year"), or to any subsequent taxable year, where
such credit was allowed for a taxable year prior to the acquisition
year.
(3) Notwithstanding the provisions of subparagraph one of this
paragraph, in the case of a corporate merger or corporate consolidation,
the surviving or consolidated corporation, as the case may be, may not
carry over any amount of credit or credits allowed under this
subdivision which is attributable to a target corporation to the taxable
year during which such corporate merger or corporate consolidation
occurred ("merger or consolidation year"), or to any subsequent taxable
year, where such credit was allowed for a taxable year prior to the
merger or consolidation year. Provided, however, where the taxpayer can
demonstrate, through the submission of a copy of the plan of merger or
consolidation and such other evidence as may be required by the
commissioner, the identity of the constituent corporation which was the
acquiring person, then the preceding sentence shall not apply to such
credit or credits allowed to such acquiring person.
* NB Applies to taxable years beginning after December 31, 1986 and
prior to January 1, 1997
* (e) The credit allowed under this subdivision for any taxable year
shall not reduce the tax due for such year to less than the higher of
the amounts prescribed in paragraphs (c) and (d) of subdivision one of
this section. However, if the amount of credit allowable under this
subdivision for any taxable year reduces the tax to such amount, any
amount of credit not deductible in such taxable year may be carried over
to the following year or years, and may be deducted from the taxpayer's
tax for such year or years, but in no event shall such credit be carried
over to taxable years commencing on or after January first, nineteen
hundred ninety-four.
* NB Applicable to taxable years beginning on or after January 1, 1997
* (f) (1) With respect to property which is depreciable pursuant to
section one hundred sixty-seven of the internal revenue code and which
is disposed of or ceases to be in qualified use prior to the end of the
taxable year in which the credit is to be taken, the amount of the
credit shall be that portion of the credit provided for in this
subdivision which represents the ratio which the months of qualified use
bear to the months of useful life. If property on which credit has been
taken is disposed of or ceases to be in qualified use prior to the end
of its useful life, the difference between the credit taken and the
credit allowed for actual use must be added back in the year of
disposition. Provided, however, if such property is disposed of or
ceases to be in qualified use after it has been in qualified use for
more than twelve consecutive years, it shall not be necessary to add
back the credit as provided in this subparagraph. The amount of credit
allowed for actual use shall be determined by multiplying the original
credit by the ratio which the months of qualified use bear to the months
of useful life. For purposes of this subparagraph, useful life of
property shall be the same as the taxpayer uses for depreciation
purposes when computing his federal income tax liability.
(2) Except with respect to that property to which subparagraph three
of this paragraph applies, with respect to three-year property, as
defined in paragraph two of subdivision (c) of section one hundred
sixty-eight of the internal revenue code, which is disposed of or ceases
to be in qualified use prior to the end of the taxable year in which the
credit is to be taken, the amount of the credit shall be that portion of
the credit provided for in this subdivision which represents the ratio
which the months of qualified use bear to thirty-six. If property on
which credit has been taken is disposed of or ceases to be in qualified
use prior to the end of thirty-six months, the difference between the
credit taken and the credit allowed for actual use must be added back in
the year of disposition. The amount of credit allowed for actual use
shall be determined by multiplying the original credit by the ratio
which the months of qualified use bear to thirty-six.
(3) With respect to any recovery property to which section one hundred
sixty-eight of the internal revenue code applies, which is a building or
a structural component of a building and which is disposed of or ceases
to be in qualified use prior to the end of the taxable year in which the
credit is to be taken, the amount of the credit shall be that portion of
the credit provided for in this subdivision which represents the ratio
which the months of qualified use bear to the total number of months
over which the taxpayer chooses to deduct the property under section one
hundred sixty-eight of the internal revenue code. If property on which
credit has been taken is disposed of or ceases to be in qualified use
prior to the end of the period over which the taxpayer chooses to deduct
the property under section one hundred sixty-eight of the internal
revenue code, the difference between the credit taken and the credit
allowed for actual use must be added back in the year of disposition.
Provided, however, if such property is disposed of or ceases to be in
qualified use after it has been in qualified use for more than twelve
consecutive years, it shall not be necessary to add back the credit as
provided in this subparagraph. The amount of credit allowed for actual
use shall be determined by multiplying the original credit by the ratio
which the months of qualified use bear to the total number of months
over which the taxpayer chooses to deduct the property under section one
hundred sixty-eight of the internal revenue code.
* NB Does not applies to property to which the amendments made by
section two hundred one of public Law 99-514 apply
* (f) (1) With respect to property which is depreciable pursuant to
section one hundred sixty-seven of the internal revenue code but is not
subject to the provisions of section one hundred sixty-eight of such
code and which is disposed of or ceases to be in qualified use prior to
the end of the taxable year in which the credit is to be taken, the
amount of the credit shall be that portion of the credit provided for in
this subdivision which represents the ratio which the months of
qualified use bear to the months of useful life. If property on which
credit has been taken is disposed of or ceases to be in qualified use
prior to the end of its useful life, the difference between the credit
taken and the credit allowed for actual use must be added back in the
year of disposition. Provided, however, if such property is disposed of
or ceases to be in qualified use after it has been in qualified use for
more than twelve consecutive years, it shall not be necessary to add
back the credit as provided in this subparagraph. The amount of credit
allowed for actual use shall be determined by multiplying the original
credit by the ratio which the months of qualified use bear to the months
of useful life. For purposes of this subparagraph, useful life of
property shall be the same as the taxpayer uses for depreciation
purposes when computing his federal income tax liability.
* (2) Except with respect to that property to which subparagraph four
of this paragraph applies, with respect to three-year property, as
defined in subdivision (e) of section one hundred sixty-eight of the
internal revenue code, which is disposed of or ceases to be in qualified
use prior to the end of the taxable year in which the credit is to be
taken, the amount of the credit shall be that portion of the credit
provided for in this subdivision which represents the ratio which the
months of qualified use bear to thirty-six. If property on which credit
has been taken is disposed of or ceases to be in qualified use prior to
the end of thirty-six months, the difference between the credit taken
and the credit allowed for actual use must be added back in the year of
disposition. The amount of credit allowed for actual use shall be
determined by multiplying the original credit by the ratio which the
months of qualified use bear to thirty-six.
** (3) Except with respect to that property to which subparagraph four
of this paragraph applies, with respect to property subject to the
provisions of section one hundred sixty-eight of the internal revenue
code, other than three-year property as defined in subsection (e) of
such section one hundred sixty-eight, which is disposed of or ceases to
be in qualified use prior to the end of the taxable year in which the
credit is to be taken, the amount of the credit shall be that portion of
the credit provided for in this subdivision which represents the ratio
which the months of qualified use bear to sixty. If property on which
credit has been taken is disposed of or ceases to be in qualified use
prior to the end of sixty months, the difference between the credit
taken and the credit allowed for actual use must be added back in the
year of disposition. The amount of credit allowed for actual use shall
be determined by multiplying the original credit by the ratio which the
months of qualified use bear to sixty.
* (4) With respect to any property to which section one hundred
sixty-eight of the internal revenue code applies, which is a building or
a structural component of a building and which is disposed of or ceases
to be in qualified use prior to the end of the taxable year in which the
credit is to be taken, the amount of the credit shall be that portion of
the credit provided for in this subdivision which represents the ratio
which the months of qualified use bear to the total number of months
over which the taxpayer chooses to deduct the property under the
internal revenue code. If property on which credit has been taken is
disposed of or ceases to be in qualified use prior to the end of the
period over which the taxpayer chooses to deduct the property under the
internal revenue code, the difference between the credit taken and the
credit allowed for actual use must be added back in the year of
disposition. Provided, however, if such property is disposed of or
ceases to be in qualified use after it has been in qualified use for
more than twelve consecutive years, it shall not be necessary to add
back the credit as provided in this subparagraph. The amount of credit
allowed for actual use shall be determined by multiplying the original
credit by the ratio which the months of qualified use bear to the total
number of months over which the taxpayer chooses to deduct the property
under the internal revenue code.
* NB Applies to property to which the amendments made by section two
hundred one of public Law 99-514 apply
** NB Applies to property to which the amendments made by section two
hundred one of public Law 99-514 apply for taxable years beginning after
December 31, 1986
* (5) Where the taxpayer is a target corporation in a subdivision
seventeen corporate acquisition, property which was the basis for the
allowance of the credit provided for under this subdivision shall be
deemed to be disposed of in the taxable year in which such acquisition
occurred.
* NB Repealed for taxable years beginning on or after January 1, 1997
* (6) Where the taxpayer is a consolidated corporation in a
subdivision eighteen corporate consolidation, property of a target
corporation which was the basis for the allowance of the credit provided
for under this subdivision, shall be deemed to be disposed of on the day
immediately preceding such subdivision eighteen corporate consolidation.
* NB Repealed for taxable years beginning on or after January 1, 1997
* (7) Where the taxpayer is a surviving corporation in a subdivision
eighteen corporate merger, property of a target corporation which was
the basis for the allowance of the credit provided for under this
subdivision, shall be deemed to be disposed of on the day immediately
preceding such subdivision eighteen corporate merger.
* NB Repealed for taxable years beginning on or after January 1, 1997
19. Empire zone wage tax credit. (a) A taxpayer shall be allowed a
credit, to be computed as hereinafter provided, against the tax imposed
by this article where the taxpayer has been certified pursuant to
article eighteen-B of the general municipal law. The amount of such
credit shall be as prescribed by paragraph (d) hereof.
(b) For the purposes of this subdivision, the following terms shall
have the following meanings:
(1) "Empire zone wages" means wages paid by the taxpayer for full-time
employment, other than to general executive officers, during the taxable
year in an area designated or previously designated as an empire zone or
zone equivalent area pursuant to article eighteen-B of the general
municipal law, where such employment is in a job created in the area (i)
during the period of its designation as an empire zone, (ii) within four
years of the expiration of such designation, or (iii) during the ten
year period immediately following the date of designation as a zone
equivalent area, provided, however, that if the taxpayer's certification
under article eighteen-B of the general municipal law is revoked with
respect to an empire zone or zone equivalent area, any wages paid by the
taxpayer, on or after the effective date of such decertification, for
employment in such zone shall not constitute empire zone wages.
(2) "Targeted employee" means a New York resident who receives empire
zone wages and who is (A) an eligible individual under the provisions of
the targeted jobs tax credit (section fifty-one of the internal revenue
code), (B) eligible for benefits under the provisions of the workforce
investment act as a dislocated worker or low-income individual (P.L.
105-220, as amended), (C) a recipient of public assistance benefits, (D)
an individual whose income is below the most recently established
poverty rate promulgated by the United States department of commerce, or
a member of a family whose family income is below the most recently
established poverty rate promulgated by the appropriate federal agency
or (E) an honorably discharged member of any branch of the armed forces
of the United States.
An individual who satisfies the criteria set forth in clause (A), (B)
or (D) at the time of initial employment in the job with respect to
which the credit is claimed, or who satisfies the criterion set forth in
clause (C) at such time or at any time within the previous two years,
shall be a targeted employee so long as such individual continues to
receive empire zone wages.
(3) "Average number of individuals, excluding general executive
officers, employed full-time" shall be computed by ascertaining the
number of such individuals employed by the taxpayer on the thirty-first
day of March, the thirtieth day of June, the thirtieth day of September
and the thirty-first day of December during each taxable year or other
applicable period, by adding together the number of such individuals
ascertained on each of such dates and dividing the sum so obtained by
the number of such dates occurring within such taxable year or other
applicable period.
(c) The credit provided for herein shall be allowed only where the
average number of individuals, excluding general executive officers,
employed full-time by the taxpayer in (A) the state and (B) the empire
zone or area previously constituting such zone or zone equivalent area,
during the taxable year exceeds the average number of such individuals
employed full-time by the taxpayer in (A) the state and (B) such zone or
area subsequently or previously constituting such zone or such zone
equivalent area, respectively, during the four years immediately
preceding the first taxable year in which the credit is claimed with
respect to such zone or area. Where the taxpayer provided full-time
employment within (A) the state or (B) such zone or area during only a
portion of such four-year period, then for purposes of this paragraph
the term "four years" shall be deemed to refer instead to such portion,
if any.
The credit shall be allowed only with respect to the first taxable
year during which payments of empire zone wages are made and the
conditions set forth in this paragraph are satisfied, and with respect
to each of the four taxable years next following (but only, with respect
to each of such years, if such conditions are satisfied), in accordance
with paragraph (d) of this subdivision. Subsequent certifications of the
taxpayer pursuant to article eighteen-B of the general municipal law, at
the same or a different location in the same empire zone or zone
equivalent area or at a location in a different empire zone or zone
equivalent area, shall not extend the five taxable year time limitation
on the allowance of the credit set forth in the preceding sentence.
Provided, further, however, that no credit shall be allowed with respect
to any taxable year beginning more than four years following the taxable
year in which designation as an empire zone expired or more than ten
years after the designation as a zone equivalent area.
(d) The amount of the credit shall equal the sum of (1) the product of
three thousand dollars and the average number of individuals (excluding
general executive officers) employed full-time by the taxpayer, computed
pursuant to the provisions of subparagraph three of paragraph (b) of
this subdivision, who
(A) received empire zone wages for more than half of the taxable year,
(B) received, with respect to more than half of the period of
employment by the taxpayer during the taxable year, an hourly wage which
was at least one hundred thirty-five percent of the minimum wage
specified in section six hundred fifty-two of the labor law, and
(C) are targeted employees; and
(2) the product of fifteen hundred dollars and the average number of
individuals (excluding general executive officers and individuals
described in subparagraph one of this paragraph) employed full-time by
the taxpayer, computed pursuant to the provisions of subparagraph three
of paragraph (b) of this subdivision, who received empire zone wages for
more than half of the taxable year.
Provided, further, however, that the credit provided for herein with
respect to the taxable year, and carryovers of such credit to the
taxable year, deducted from the tax otherwise due, may not, in the
aggregate, exceed fifty percent of the tax imposed under section two
hundred nine computed without regard to any credit provided for by this
article.
(3) For purposes of calculating the amount of the credit, individuals
employed within an empire zone or zone equivalent area within the
immediately preceding sixty months by a related person, as such term is
defined in subparagraph (c) of paragraph three of subsection (b) of
section four hundred sixty-five of the internal revenue code, shall not
be included in the average number of individuals described in
subparagraph one or subparagraph two of this paragraph, unless such
related person was never allowed a credit under this subdivision with
respect to such employees. For the purposes of this subparagraph, a
"related person" shall include an entity which would have qualified as a
"related person" to the taxpayer if it had not been dissolved,
liquidated, merged with another entity or otherwise ceased to exist or
operate.
(4) If a taxpayer is certified in an empire zone designated under
subdivision (a) or (d) of section nine hundred fifty-eight of the
general municipal law, the dollar amounts specified under subparagraph
one or two of this paragraph shall be increased by five hundred dollars
for each qualifying individual under such subparagraph who received,
during the taxable year, wages in excess of forty thousand dollars.
* (e) The credit and carryovers of such credit allowed under this
subdivision for any taxable year shall not, in the aggregate, reduce the
tax due for such year to less than the minimum fixed by subparagraph
four of paragraph (a) of subdivision one of this section. However, if
the amount of credit or carryovers of such credit, or both, allowable
under this subdivision for any taxable year reduces the tax to the
minimum fixed by subparagraph four of paragraph (a) of subdivision one
of this section, or if any part of the credit or carryovers of such
credit is disallowed by reason of the final sentence of paragraph (d)
hereof, any amount of credit or carryovers of such credit thus not
deductible in such taxable year may be carried over to the following
year or years and may be deducted from the tax for such year or years.
* NB Applies to taxable years prior to December 31, 1986
* (e) The credit and carryovers of such credit allowed under this
subdivision for any taxable year shall not, in the aggregate, reduce the
tax due for such year to less than the higher of the amounts prescribed
in paragraphs (c) and (d) of subdivision one of this section. However,
if the amount of credit or carryovers of such credit, or both, allowed
under this subdivision for any taxable year reduces the tax to such
amount, or if any part of the credit or carryovers of such credit may
not be deducted from the tax otherwise due by reason of the final
sentence of paragraph (d) hereof, any amount of credit or carryovers of
such credit thus not deductible in such taxable year may be carried over
to the following year or years and may be deducted from the tax for such
year or years. In lieu of such carryover, any such taxpayer which
qualifies as a new business under paragraph (j) of subdivision twelve of
this section may elect, on its report for its taxable year with respect
to which such credit is allowed, to treat fifty percent of the amount of
such carryover as an overpayment of tax to be credited or refunded in
accordance with the provisions of section ten hundred eighty-six of this
chapter. Provided, however, the provisions of subsection (c) of section
ten hundred eighty-eight of this chapter notwithstanding, no interest
shall be paid thereon.
* NB Applies to taxable years beginning after December 31, 1986
(f) For the interaction of this subdivision and subdivision twelve-D
of this section (employment incentive credit), see paragraph (b) of such
subdivision twelve-D.
20. Empire zone capital tax credit. (a) A taxpayer shall be allowed a
credit against the tax imposed by this article. The amount of the credit
shall be equal to twenty-five percent of the sum of the following
investments and contributions made during the taxable year and certified
by the commissioner of economic development: (1) for taxable years
beginning before January first, two thousand five, qualified investments
made in, or contributions in the form of donations made to, one or more
empire zone capital corporations established pursuant to section nine
hundred sixty-four of the general municipal law prior to January first,
two-thousand five, (2) qualified investments in certified zone
businesses which during the twelve month period immediately preceding
the month in which such investment is made employed full-time within the
state an average number of individuals, excluding general executive
officers, of two hundred fifty or fewer, computed pursuant to the
provisions of subparagraph three of paragraph (b) of subdivision
nineteen of this section, except for investments made by or on behalf of
an owner of the business, including, but not limited to, a stockholder,
partner or sole proprietor, or any related person, as defined in
subparagraph (C) of paragraph three of subsection (b) of section four
hundred sixty-five of the internal revenue code, and (3) contributions
of money to community development projects as defined in regulations
promulgated by the commissioner of economic development. "Qualified
investments" means the contribution of property to a corporation in
exchange for original issue capital stock or other ownership interest,
the contribution of property to a partnership in exchange for an
interest in the partnership, and similar contributions in the case of a
business entity not in corporate or partnership form in exchange for an
ownership interest in such entity. The total amount of credit allowable
to a taxpayer under this provision for all years, taken in the
aggregate, shall not exceed three hundred thousand dollars, and shall
not exceed one hundred thousand dollars with respect to the investments
and contributions described in each of subparagraphs one, two and three
of this paragraph.
* (b) The credit allowed under this subdivision for any taxable year
shall not reduce the tax due for such year to less than the minimum
fixed by subparagraph four of paragraph (a) of subdivision one of this
section. In addition, no taxpayer shall be allowed a credit, or credits
with respect to more than one year, taken in the aggregate, of more than
one hundred thousand dollars. In addition, such credit may not exceed
fifty percent of the tax imposed under section two hundred nine computed
without regard to any credit provided for by this section.
* NB Applies to taxable years prior to December 31, 1986
* (b) In no event shall the credit and carryover of such credit
allowed under this subdivision for any taxable year, in the aggregate,
reduce the tax due for such year to less than the higher of the amounts
prescribed in paragraphs (c) and (d) of subdivision one of this section.
However, if the amount of credit or carryovers of such credit, or both,
allowed under this subdivision for any taxable year reduces the tax to
such amount, or if any part of the credit or carryovers of such credit
may not be deducted from the tax otherwise due by reason of the final
sentence of this paragraph, any amount of credit or carryovers of such
credit thus not deductible in such taxable year may be carried over to
the following year or years and may be deducted from the tax for such
year or years. In addition, the amount of such credit, and carryovers of
such credit to the taxable year, deducted from the tax otherwise due may
not, in the aggregate, exceed fifty percent of the tax imposed under
section two hundred nine computed without regard to any credit provided
for by this section.
* NB Applies to taxable years beginning after December 31, 1986
(c) Where the stock, partnership interest or other ownership interest
arising from a qualified investment as described in subparagraphs one
and two of paragraph (a) of this subdivision is disposed of, the
taxpayer's entire net income shall be computed, pursuant to regulations
promulgated by the commissioner, so as to properly reflect the reduced
cost thereof arising from the application of the credit provided for
herein.
(d) (1) Where a taxpayer sells, transfers or otherwise disposes of
corporate stock, a partnership interest or other ownership interest
arising from the making of a qualified investment which was the basis,
in whole or in part, for the allowance of the credit provided for under
this subdivision, or where a contribution or investment which was the
basis for such allowance is in any manner, in whole or in part,
recovered by such taxpayer, and such disposition or recovery occurs
during the taxable year or within thirty-six months from the close of
the taxable year with respect to which such credit is allowed,
subparagraph two of this paragraph shall apply.
(2) The taxpayer shall add back with respect to the taxable year in
which the disposition or recovery described in subparagraph one occurred
the required portion of the credit originally allowed.
(3) The required portion of the credit originally allowed shall be the
product of (A) the portion of such credit attributable to the property
disposed of or the payment or contribution recovered and (B) the
applicable percentage.
(4) The applicable percentage shall be:
(A) one hundred percent, if the disposition or recovery occurs within
the taxable year with respect to which the credit is allowed or within
twelve months of the end of such taxable year,
(B) sixty-seven percent, if the disposition or recovery occurs more
than twelve but not more than twenty-four months after the end of the
taxable year with respect to which the credit is allowed, or
(C) thirty-three percent, if the disposition or recovery occurs more
than twenty-four but not more than thirty-six months after the end of
the taxable year with respect to which the credit is allowed.
21. Credits of New York S corporations. Notwithstanding the provisions
of this section, no carryover of credit allowable in a New York C year
shall be deducted from the tax otherwise due under this article in a New
York S year, and no credit allowable in a New York S year, or carryover
of such credit, shall be deducted from the tax imposed by this article.
However, a New York S year shall be treated as a taxable year for
purposes of determining the number of taxable years to which a credit
may be carried over under this section. Notwithstanding the first
sentence of this subdivision, however, the credit for the special
additional mortgage recording tax shall be allowed as provided in
subdivision seventeen of this section for any such tax which is due and
paid in taxable years beginning on or after January first, nineteen
hundred ninety-four, and the carryover of any such credit shall be
determined without regard to whether the credit is carried from a New
York C year to a New York S year or vice-versa.
21-a. Credit for servicing certain mortgages. Every mortgage banker
meeting the requirements of the state of New York mortgage agency
applicable to the servicing of mortgages acquired by such agency
pursuant to the state of New York mortgage agency act and licensed under
article twelve-D of the banking law, which shall have entered into a
contract with the state of New York mortgage agency to service mortgages
acquired by such agency pursuant to the state of New York mortgage
agency act, shall have credited to it annually to apply upon or in lieu
of the payment of any tax to which it may be subject under this article
an amount equal to two and ninety-three one hundredths per centum of the
total principal and interest collected by the mortgage banker during its
taxable year on each such mortgage secured by a lien on real estate
improved by a one-family to four-family residential structure and an
amount equal to the interest collected by the mortgage banker during its
taxable year on each such mortgage secured by a lien on real property
improved by a structure occupied as the residence of five or more
families living independently of each other, multiplied by a fraction of
the denominator of which shall be the interest rate payable on the
mortgage (computed to five decimal places) and the numerator of which
shall be .00125 in the case of such a mortgage acquired by such agency
for less than one million dollars, and .00100 in the case of such a
mortgage acquired by such agency for one million dollars or more;
provided, however, that there shall in no case be credited to any such
bank an amount in excess of the amount due from such bank for taxes
payable to the state under this article for the taxable year for which
such credit is given. In computing such tax credit for the servicing of
mortgages on one-family to four-family residential structures, the
mortgage banker shall be entitled to no credit for the collection of
curtailments or payments in discharge of any such mortgage. For the
purposes of this section, (a) a "curtailment" shall mean amounts paid by
mortgagors (1) in excess of the monthly constant due during the month of
collection and (2) in reduction of the unpaid principal balance of the
mortgage; in the absence of clear evidence to the contrary, amounts paid
in excess of the monthly constant due during the month of collection
shall be deemed to be in reduction of the unpaid principal balance of
the mortgage; and (b) "monthly constant" shall mean the amount of
principal and interest which is due and payable according to the
mortgage documents on each periodic payment date.
22. Agricultural property tax credit. (a) General. In the case of a
taxpayer which is an eligible farmer or an eligible farmer who has paid
taxes pursuant to a land contract, there shall be allowed a credit for
the allowable school district property taxes. The term "allowable school
district property taxes" means the school district property taxes paid
during the taxable year on qualified agricultural property, subject to
the acreage limitation provided in paragraph (e) of this subdivision and
the income limitation provided in paragraph (f) of this subdivision.
(b) Eligible farmer. For purposes of this subdivision, the term
"eligible farmer" means a taxpayer whose federal gross income from
farming for the taxable year is at least two-thirds of excess federal
gross income. The term "eligible farmer" also includes a corporation
other than the taxpayer of record for qualified agricultural land which
has paid the school district property taxes on such land pursuant to a
contract for the future purchase of such land; provided that such
corporation has a federal gross income from farming for the taxable year
which is at least two-thirds of excess federal gross income; and
provided further that, in determining such income eligibility, a
taxpayer may, for any taxable year, use the average of such federal
gross income from farming for that taxable year and such income for the
two consecutive taxable years immediately preceding such taxable year.
Excess federal gross income means the amount of federal gross income
from all sources for the taxable year in excess of thirty thousand
dollars.
(c) School district property taxes. For purposes of this subdivision,
the term "school district property taxes" means all property taxes,
special ad valorem levies and special assessments, exclusive of
penalties and interest, levied for school district purposes on the
qualified agricultural property owned by the taxpayer.
(d) Qualified agricultural property. For purposes of this subdivision,
the term "qualified agricultural property" means land located in this
state which is used in agricultural production, and land improvements,
structures and buildings (excluding buildings used for the taxpayer's
residential purpose) located on such land which are used or occupied to
carry out such production. Qualified agricultural property also includes
land set aside or retired under a federal supply management or soil
conservation program or land that at the time it becomes subject to a
conservation easement, as defined under subdivision thirty-eight of this
section, met the requirements under this paragraph.
(e) Acreage limitation. (1) Eligible taxes. In the event that the
qualified agricultural property owned by the taxpayer includes land in
excess of the base acreage as provided in this paragraph, the amount of
school district property taxes eligible for credit under this
subdivision shall be that portion of the school district property taxes
which bears the same ratio to the total school district property taxes
paid during the taxable year, as the acreage allowable under this
paragraph bears to the entire acreage of such land.
(2) Allowable acreage. The allowable acreage is the sum of the base
acreage set forth below and fifty percent of the incremental acreage.
The incremental acreage is the excess of the entire acreage of qualified
agricultural land owned by the taxpayer over the base acreage. Except as
provided in subparagraph three of this paragraph:
For taxable years beginning: The base acreage is:
in 1997 100
after 1997 but before 2006 250
2006 and thereafter 350
For taxable years beginning after two thousand, the total base acreage
may be increased by any acreage enrolled or participating during the
taxable year in a federal environmental conservation acreage reserve
program pursuant to title three of the federal agriculture improvement
and reform act of nineteen hundred ninety-six.
(3) Base acreage of related persons. Where the taxpayer and one or
more related persons each own qualified agricultural property on the
first day of March of any year, the base acreage under subparagraph two
of this paragraph shall be divided equally and allotted among the
taxpayer and such related persons, and the taxpayer's base acreage for
the taxable year which includes such March first shall be limited to its
allotted share. Provided, however, if the taxpayer and all such related
persons consent (at such time and in such manner as the commissioner may
prescribe) to an unequal division, the taxpayer's base acreage for such
taxable year shall be limited to its allotted share under such unequal
division.
(4) Related persons. (A) For purposes of subparagraph three of this
paragraph, the term "related person" means:
(i) a corporation subject to tax under this article, where the
taxpayer and the corporation are members of the same controlled group,
as defined in section 267(f) of the internal revenue code;
(ii) an individual, partnership, estate or trust, where more than
fifty percent in value of the outstanding stock of the taxpayer is
owned, directly or indirectly, by or for such individual, partnership,
estate or trust or by or for the grantor of such trust;
(iii) a corporation subject to tax under this article, or a
partnership, estate or trust, if the same person owns more than fifty
percent in value of the outstanding stock of the taxpayer and more than
fifty percent in value of the outstanding stock of the corporation, or
more than fifty percent of the capital or profits interest in the
partnership, or more than fifty percent of the beneficial interest in
the estate or trust;
(iv) a partnership, estate or trust of which the taxpayer owns,
directly or indirectly, more than fifty percent of the capital, profits
or beneficial interest.
(B) In determining whether a person is a related person within the
meaning of this subparagraph:
(i) stock owned, directly or indirectly, by or for a corporation,
partnership, estate or trust shall be considered as being owned
proportionately by or for its shareholders, partners or beneficiaries;
(ii) an individual shall be considered as owning the stock owned,
directly or indirectly, by or for his spouse;
(iii) stock constructively owned by a person by reason of the
application of item (i) of this clause shall, for the purpose of
applying item (i) or (ii) of this clause, be treated as actually owned
by such person.
(f) Income limitation. (1) In the event that the modified entire net
income of the taxpayer exceeds one hundred thousand dollars for taxable
years beginning before two thousand six or two hundred thousand dollars
for taxable year two thousand six and thereafter, the allowable school
district property taxes under paragraph (a) of this subdivision shall be
the eligible taxes under subparagraph one of paragraph (e) of this
subdivision reduced by the product of the amount of such eligible taxes
and a percentage, such percentage to be determined by multiplying one
hundred percent by a fraction, the numerator of which is the lesser of
fifty thousand dollars for taxable years before two thousand six or one
hundred thousand dollars for taxable year two thousand six and
thereafter or the excess of the taxpayer's modified entire net income
over one hundred thousand dollars for taxable years beginning before two
thousand six or two hundred thousand dollars for taxable year two
thousand six and thereafter and the denominator of which is fifty
thousand dollars for taxable years beginning before two thousand six or
one hundred thousand dollars for taxable year two thousand six and
thereafter. For purposes of the preceding sentence, the term "eligible
taxes", where the acreage limitation of paragraph (e) of this
subdivision does not apply, shall mean the total school district
property taxes paid during the taxable year.
(2) The term "modified entire net income" means the entire net income
for the taxable year reduced by the amount of principal paid on farm
indebtedness during the taxable year. The term "farm indebtedness" means
debt incurred or refinanced which is secured by farm property, where the
proceeds of the debt are disbursed for expenditures incurred in the
business of farming.
(g) In no event shall the credit provided herein be allowed in an
amount which will reduce the tax payable to less than the higher of the
amounts prescribed in paragraphs (c) and (d) of subdivision one of this
section. If, however, the amount of credit allowable under this
subdivision for any taxable year reduces the tax to such amount, any
amount of credit not deductible in such taxable year may be carried over
to the following year or years and may be deducted from the taxpayer's
tax for such year or years. Provided, however, in lieu of carrying over
the unused portion of such credit, the taxpayer may elect to treat such
unused portion as an overpayment of tax to be credited or refunded in
accordance with the provisions of section ten hundred eighty-six of this
chapter except that no interest shall be paid on such overpayment.
(h) Nonqualified use. (1) No credit in conversion year. In the event
that qualified agricultural property is converted by the taxpayer to
nonqualified use, credit under this subdivision shall not be allowed
with respect to such property for the taxable year of conversion (the
conversion year).
(2) Credit recapture. If the conversion by the taxpayer of qualified
agricultural property to nonqualified use occurs during the period of
the two taxable years following the taxable year for which the credit
under this subdivision was first claimed with respect to such property,
the credit allowed with respect to such property for the taxable years
prior to the conversion year must be added back in the conversion year.
Where the property converted includes land, and where the conversion is
of only a portion of such land, the credit allowed with respect to the
property converted shall be determined by multiplying the entire credit
under this subdivision for the taxable years prior to the conversion
year by a fraction, the numerator of which is the acreage converted and
the denominator of which is the entire acreage of such land owned by the
taxpayer immediately prior to the conversion.
(3) Exception to recapture. Subparagraph two of this paragraph shall
not apply to the conversion of property where the conversion is by
reason of involuntary conversion, within the meaning of section one
thousand thirty-three of the internal revenue code.
(4) Conversion to nonqualified use. For purposes of this paragraph, a
sale or other disposition of qualified agricultural property alone shall
not constitute a conversion to a nonqualified use.
(i) Special rules. For purposes of this subdivision, the term "federal
gross income from farming" shall include gross income from the
production of maple syrup, cider, Christmas trees derived from a managed
Christmas tree operation whether dug for transplanting or cut from the
stump, or from a commercial horse boarding operation as defined in
subdivision thirteen of section three hundred one of the agriculture and
markets law, or from the sale of wine from a licensed farm winery as
provided for in article six of the alcoholic beverage control law.
(j) Election to deem gross income of New York C corporation to
shareholders. For purposes of this subdivision, federal gross income
from farming shall be zero for any taxable year of a New York C
corporation for which the election under paragraph nine of subsection
(n) of section six hundred six of this chapter is in effect.
23. Credit for employment of persons with disabilities. (a) Allowance
of credit. A taxpayer shall be allowed a credit, to be computed as
hereinafter provided, against the tax imposed by this article, for
employing within the state a qualified employee.
(b) Qualified employee. A qualified employee is an individual:
(1) who is certified by the education department, or in the case of an
individual who is blind or visually handicapped, by the state agency
responsible for provision of vocational rehabilitation services to the
blind and visually handicapped: (i) as a person with a disability which
constitutes or results in a substantial handicap to employment and (ii)
as having completed or as receiving services under an individualized
written rehabilitation plan approved by the education department or
other state agency responsible for providing vocational rehabilitation
services to such individual; and
(2) who has worked on a full-time basis for the employer who is
claiming the credit for at least one hundred eighty days or four hundred
hours.
(c) Amount of credit. Except as provided in paragraph (d) of this
subdivision, the amount of credit shall be thirty-five percent of the
first six thousand dollars in qualified first-year wages earned by each
qualified employee. "Qualified first-year wages" means wages paid or
incurred by the taxpayer during the taxable year to qualified employees
which are attributable, with respect to any such employee, to services
rendered during the one-year period beginning with the day the employee
begins work for the taxpayer.
(d) Credit where federal work opportunity tax credit applies. With
respect to any qualified employee whose qualified first-year wages under
paragraph (c) of this subdivision also constitute qualified first-year
wages for purposes of the work opportunity tax credit for vocational
rehabilitation referrals under section fifty-one of the internal revenue
code, the amount of credit under this subdivision shall be thirty-five
percent of the first six thousand dollars in qualified second-year wages
earned by each such employee. "Qualified second-year wages" means wages
paid or incurred by the taxpayer during the taxable year to qualified
employees which are attributable, with respect to any such employee, to
services rendered during the one-year period beginning one year after
the employee begins work for the taxpayer.
(e) Carryover. The credit allowed under this subdivision for any
taxable year shall not reduce the tax due for such year to less than the
amount prescribed in paragraph (d) of subdivision one of this section.
However, if the amount of credit allowable under this subdivision for
any taxable year reduces the tax to such amount, any amount of credit
not deductible in such taxable year may be carried over to the following
year or years, and may be deducted from the taxpayer's tax for such year
or years.
(f) Coordination with federal work opportunity tax credit. The
provisions of sections fifty-one and fifty-two of the internal revenue
code, as such sections applied on October first, nineteen hundred
ninety-six, that apply to the federal work opportunity tax credit for
vocational rehabilitation referrals shall apply to the credit under this
subdivision to the extent that such sections are consistent with the
specific provisions of this subdivision, provided that in the event of a
conflict the provisions of this subdivision shall control.
24. Alternative fuels credit. (a) General. A taxpayer shall be allowed
a credit, to be computed as hereinafter provided, against the tax
imposed by this article for clean-fuel vehicle refueling property placed
in service during the taxable year.
(b) Clean-fuel vehicle refueling property. The credit under this
subdivision for clean-fuel vehicle refueling property shall equal fifty
percent of the cost of any such property:
(i) which is located in this state; and
(ii) for which a deduction is allowed under section one hundred
seventy-nine-A of the internal revenue code (determined without regard
to the limitations prescribed in paragraph two of subsection (b) of such
section or the election referred to in subsection (e) of such section
with respect to section one hundred seventy-nine of such code).
(c) Definitions. (i) The term "clean-fuel vehicle refueling property"
means any such property which is qualified within the meaning of
subsection (d) of section one hundred seventy-nine-A of the internal
revenue code.
(ii) The term "clean-fuel" means natural gas, liquified petroleum gas,
hydrogen, electricity, and any other fuel which is at least eighty-five
percent, singly or in combination, methanol, ethanol, any other alcohol,
or ether.
(d) Carryovers. In no event shall the credit under this subdivision be
allowed in an amount which will reduce the tax payable to less than the
higher of the amounts prescribed in paragraphs (c) and (d) of
subdivision one of this section. Provided, however, that if the amount
of credit allowable under this subdivision for any taxable year reduces
the tax to such amount, any amount of credit not deductible in such
taxable year may be carried over to the following year or years and may
be deducted from the taxpayer's tax for such year or years.
(e) Credit recapture. (i) If, at any time before the end of its
recovery period, clean-fuel vehicle refueling property ceases to be
qualified, a recapture amount must be added back in the year in which
such cessation occurs.
(ii) Clean-fuel vehicle refueling property ceases to be qualified if:
(A) the property no longer qualifies as property described in
subsection (d) of section one hundred seventy-nine-A of the internal
revenue code; or
(B) fifty percent or more of the use of the property in a taxable year
is other than in a trade or business in this state; or
(C) the taxpayer receiving the credit under this subdivision sells or
disposes of the property and knows or has reason to know that the
property will be used in a manner described in clauses (A) and (B) of
this subparagraph.
(iii) Recapture amount. The recapture amount is equal to the credit
allowable under this subdivision multiplied by a fraction, the numerator
of which is the total recovery period for the property minus the number
of recovery years prior to, but not including, the recapture year, and
the denominator of which is the total recovery period.
(f) Affiliates. (i) If a credit under this subdivision is allowed to a
taxpayer with respect to a taxable year, the action taken by such
taxpayer which resulted in such credit being allowed thereto may, at the
election of the taxpayer and an affiliate thereof, be ascribed to such
affiliate. Where such affiliate, based on such ascription, is allowed
such credit and deducts from the tax otherwise due the amount of such
credit, such credit shall be deemed in all respects to have been allowed
to such affiliate, provided that any action or inaction by the taxpayer
which constitutes an event of recapture described in paragraph (e) of
this subdivision shall be ascribed to the affiliate and shall constitute
an event of recapture with respect to the credit allowed to the
affiliate pursuant to this subdivision.
(ii) Notwithstanding any other provision of law to the contrary, in
the case of the credit provided for under this subdivision being allowed
to, or asserted to be allowed to, an affiliate, pursuant to subparagraph
(i) of this paragraph, the commissioner shall have the same powers with
respect to examining the books and records of the taxpayer, and have
such other powers of investigation with respect to the taxpayer, as are
afforded under this chapter with respect to a taxpayer which has
deducted the credit allowed under this section from tax otherwise due,
as if it were the taxpayer which had deducted such credit from tax
otherwise due.
(iii) The term "affiliate" shall mean a corporation substantially all
the capital stock of which is owned or controlled either directly or
indirectly by the taxpayer, or which owns or controls either directly or
indirectly substantially all the capital stock of the taxpayer, or
substantially all the capital stock of which is owned or controlled
either directly or indirectly by interests which own or control either
directly or indirectly substantially all the capital stock of the
taxpayer.
* 25. Credit for purchase of an automated external defibrillator. A
taxpayer shall be allowed a credit, to be computed as hereinafter
provided, against the tax imposed by this article, for the purchase,
other than for resale, of an automated external defibrillator, as such
term is defined in section three thousand-b of the public health law.
The amount of credit shall be the cost to the taxpayer of automated
external defibrillators purchased during the taxable year, such credit
not to exceed five hundred dollars with respect to each unit purchased.
The credit allowed under this subdivision for any taxable year shall not
reduce the tax due for such year to less than the higher of the amounts
prescribed in paragraphs (c) and (d) of subdivision one of this section.
* NB Applies to taxable years beginning on or after January 1, 2001
25-a. (a) A taxpayer shall be allowed a credit against the tax
imposed by this article equal to twenty percent of the premium paid
during the taxable year for long-term care insurance. In order to
qualify for such credit, the taxpayer's premium payment must be for the
purchase of or for continuing coverage under a long-term care insurance
policy that qualifies for such credit pursuant to section one thousand
one hundred seventeen of the insurance law.
(b) The credit allowed under this subdivision for any year shall not
reduce the tax due for such year to less than the higher of the amounts
prescribed in paragraphs (c) and (d) of subdivision one of this section.
If, however, the amount of credit allowable under this subdivision for
any taxable year reduces the tax to such amount, any amount of credit
not deductible in such taxable year may be carried over to the following
year or years and may be deducted from the taxpayer's tax for such year
or years.
26. Order of credits. Credits allowable under this article which
cannot be carried over and which are not refundable shall be deducted
first. The credit allowable under subdivision nineteen of this section
shall be deducted immediately after the deduction of all credits
allowable under this article which cannot be carried over and which are
not refundable, whether or not a portion of such credit is refundable.
Credits allowable under this article which can be carried over, and
carryovers of such credits, shall be deducted next after the deduction
of the credit allowable under subdivision nineteen of this section, and
among such credits, those whose carryover is of limited duration shall
be deducted before those whose carryover is of unlimited duration.
Credits allowable under this article which are refundable (other than
the credit allowable under subdivision nineteen of this section) shall
be deducted last.
* 26-a. IMB credit for energy taxes. (a) Allowance of credit. A
taxpayer which is an industrial or manufacturing business (IMB) shall be
allowed a credit for energy taxes, to be computed as provided in section
fourteen-a of this chapter, against the tax imposed by this article.
(b) Application of credit. The credit allowed under this subdivision
for any taxable year shall not reduce the tax due for such year to less
than the higher of the amounts prescribed in paragraphs (c) and (d) of
subdivision one of this section. However, if the amount of credit
allowed under this subdivision for any taxable year reduces the tax to
such amount, any amount of credit thus not deductible in such taxable
year shall be treated as an overpayment of tax to be credited or
refunded in accordance with the provisions of section ten hundred
eighty-six of this chapter. Provided, however, the provisions of
subsection (c) of section ten hundred eighty-eight of this chapter
notwithstanding, no interest shall be paid thereon.
* NB Repealed for taxable years ending on and after January 1, 2007
27. QEZE credit for real property taxes. (a) Allowance of credit. A
taxpayer which is a qualified empire zone enterprise shall be allowed a
credit for eligible real property taxes, to be computed as provided in
section fifteen of this chapter, against the tax imposed by this
article.
(b) Application of credit. The credit allowed under this subdivision
for any taxable year shall not reduce the tax due for such year to less
than the higher of the amounts prescribed in paragraphs (c) and (d) of
subdivision one of this section. However, if the amount of credit
allowed under this subdivision for any taxable year reduces the tax to
such amount, any amount of credit thus not deductible in such taxable
year shall be treated as an overpayment of tax to be credited or
refunded in accordance with the provisions of section ten hundred
eighty-six of this chapter. Provided, however, the provisions of
subsection (c) of section ten hundred eighty-eight of this chapter
notwithstanding, no interest shall be paid thereon.
28. QEZE tax reduction credit. (a) Allowance of credit. A taxpayer
which is a qualified empire zone enterprise shall be allowed a QEZE tax
reduction credit, to be computed as provided in section sixteen of this
chapter, against the tax imposed by this article.
(b) Application of credit. The credit allowed under this subdivision
for any taxable year shall not reduce the tax due for such year to less
than the amount prescribed in paragraph (d) of subdivision one of this
section. Provided, however, this paragraph shall not apply to a taxpayer
with a zone allocation factor of one hundred percent.
30. Low-income housing credit. (a) Allowance of credit. A taxpayer
shall be allowed a credit against the tax imposed by this article with
respect to the ownership of eligible low-income buildings, computed as
provided in section eighteen of this chapter.
(b) Application of credit. The credit and carryovers of such credit
allowed under this subdivision for any taxable year shall not, in the
aggregate, reduce the tax due for such year to less than the higher of
the amounts prescribed in paragraphs (c) and (d) of subdivision one of
this section. However, if the amount of credit or carryovers or such
credit, or both, allowed under this subdivision for any taxable year
reduces the tax to such amount, any amount of credit or carryovers of
such credit thus not deductible in such taxable year may be carried over
to the following year or years and may be deducted from the tax for such
year or years.
(c) Credit recapture. For provisions requiring recapture of credit,
see subdivision (b) of section eighteen of this chapter.
31. Green building credit. (a) Allowance of credit. A taxpayer shall
be allowed a credit, to be computed as provided in section nineteen of
this chapter, against the tax imposed by this article.
(b) Carryovers. The credit and carryovers of such credit allowed under
this subdivision for any taxable year shall not, in the aggregate,
reduce the tax due for such year to less than the higher of the amounts
prescribed in paragraphs (c) and (d) of subdivision one of this section.
However, if the amount of credit or carryovers of such credit, or both,
allowed under this subdivision for any taxable year reduces the tax to
such amount, any amount of credit or carryovers of such credit thus not
deductible in such taxable year may be carried over to the following
year or years and may be deducted from the tax for such year or years.
32. Credit for transportation improvement contributions. (a) Allowance
of credit. A taxpayer shall be allowed a credit, to be computed as
provided in section twenty of this chapter, against the tax imposed by
this article.
(b) Application of credit. The credit allowed under this subdivision
for any taxable year shall not reduce the tax due for such year to less
than the higher of the amounts prescribed in paragraphs (c) and (d) of
subdivision one of this section. However, if the amount of credit
allowed under this subdivision for any taxable year reduces the tax to
such amount, any amount of credit thus not deductible in such taxable
year shall be treated as an overpayment of tax to be credited or
refunded in accordance with the provisions of section ten hundred
eighty-six of this chapter. Provided, however, the provisions of
subsection (c) of section ten hundred eighty-eight of this chapter
notwithstanding, no interest shall be paid thereon.
(c) Credit recapture. For provisions requiring recapture of credit,
see subdivision (c) of section twenty of this chapter.
33. Brownfield redevelopment tax credit. (a) Allowance of credit. A
taxpayer shall be allowed a credit, to be computed as provided in
section twenty-one of this chapter, against the tax imposed by this
article.
(b) Application of credit. The credit allowed under this subdivision
for any taxable year shall not reduce the tax due for such year to less
than the higher amount prescribed in paragraphs (c) and (d) of
subdivision one of this section. However, if the amount of credits
allowed under this subdivision for any taxable year reduces the tax to
such amount, any amount of credit thus not deductible in such taxable
year shall be treated as an overpayment of tax to be credited or
refunded in accordance with the provisions of section ten hundred
eighty-six of this chapter. Provided, however, the provisions of
subsection (c) of section ten hundred eighty-eight of this chapter
notwithstanding, no interest shall be paid thereon.
34. Remediated brownfield credit for real property taxes for qualified
sites. (a) Allowance of credit. A taxpayer which is a developer of a
qualified site shall be allowed a credit for eligible real property
taxes, to be computed as provided in subdivision (b) of section
twenty-two of this chapter, against the tax imposed by this article. For
purposes of this subdivision, the terms "qualified site" and "developer"
shall have the same meaning as set forth in paragraphs two and three,
respectively, of subdivision (a) of section twenty-two of this chapter.
(b) Application of credit. The credit allowed under this subdivision
for any taxable year shall not reduce the tax due for such year to less
than the higher of the amounts prescribed in paragraphs (c) and (d) of
subdivision one of this section. However, if the amount of credit
allowed under this subdivision for any taxable year reduces the tax to
such amount, any amount of credit thus not deductible in such taxable
year shall be treated as an overpayment of tax to be credited or
refunded in accordance with the provisions of section ten hundred
eighty-six of this chapter. Provided, however, the provisions of
subsection (c) of section ten hundred eighty-eight of this chapter
notwithstanding, no interest shall be paid thereon.
35. Environmental remediation insurance credit. (a) Allowance of
credit. A taxpayer shall be allowed a credit, to be computed as provided
in section twenty-three of this chapter, against the tax imposed by this
article.
(b) Application of credit. The credit allowed under this subdivision
for any taxable year shall not reduce the tax due for such year to less
than the higher amount prescribed in paragraphs (c) and (d) of
subdivision one of this section. However, if the amount of credits
allowed under this subdivision for any taxable year reduces the tax to
such amount, any amount of credit thus not deductible in such taxable
year shall be treated as an overpayment of tax to be credited or
refunded in accordance with the provisions of section one thousand
eighty-six of this chapter. Provided, however, the provisions of
subsection (c) of section one thousand eighty-eight of this chapter
notwithstanding, no interest shall be paid thereon.
* 36. Empire state film production credit. (a) Allowance of credit. A
taxpayer who is eligible pursuant to section twenty-four of this chapter
shall be allowed a credit to be computed as provided in such section
twenty-four against the tax imposed by this article.
(b) Application of credit. The credit allowed under this subdivision
for any taxable year shall not reduce the tax due for such year to less
than the amount prescribed in paragraph (d) of subdivision one of this
section. Provided, however, that if the amount of the credit allowable
under this subdivision for any taxable year reduces the tax to such
amount, fifty percent of the excess shall be treated as an overpayment
of tax to be credited or refunded in accordance with the provisions of
section ten hundred eighty-six of this chapter. Provided, however, the
provisions of subsection (c) of section ten hundred eighty-eight of this
chapter notwithstanding, no interest shall be paid thereon. The balance
of such credit not credited or refunded in such taxable year may be
carried over to the immediately succeeding taxable year and may be
deducted from the taxpayer's tax for such year. The excess, if any, of
the amount of the credit over the tax for such succeeding year shall be
treated as an overpayment of tax to be credited or refunded in
accordance with the provisions of section ten hundred eighty-six of this
chapter. Provided, however, the provisions of subsection (c) of section
ten hundred eighty-eight of this chapter notwithstanding, no interest
shall be paid thereon.
* NB Repealed August 20, 2008
* 37. Security training tax credit. (a) Allowance of credit. A
taxpayer shall be allowed a credit, to be computed as provided in
section twenty-six of this chapter, against the tax imposed by this
article.
(b) Application of credit. The credit allowed under this subdivision
for any taxable year shall not reduce the tax due for such year to less
than the higher amount prescribed in paragraphs (c) and (d) of
subdivision one of this section. However, if the amount of credits
allowed under this subdivision for any taxable year reduces the tax to
such amount, any amount of credit thus not deductible in such taxable
year shall be treated as an overpayment of tax to be credited or
refunded in accordance with the provisions of section one thousand
eighty-six of this chapter. Provided, however, the provisions of
subsection (c) of section one thousand eighty-eight of this chapter
notwithstanding, no interest shall be paid thereon.
* NB There are 2 sb 37's
* 37. Credit for fuel cell electric generating equipment expenditures.
(a) Allowance of credit. A taxpayer shall be allowed a credit against
the tax imposed by this article, equal to its qualified fuel cell
electric generating equipment expenditures. This credit shall not exceed
one thousand five hundred dollars per generating unit with respect to
any taxable year. The credit provided for herein shall be allowed with
respect to the taxable year in which the fuel cell electric generating
equipment is placed in service.
(b) Qualified fuel cell electric generating equipment expenditures.
(i) Qualified fuel cell electric generating equipment expenditures are
the costs, incurred on or after July first, two thousand five,
associated with the purchase of on-site electricity generation units
utilizing proton exchange membrane fuel cells, providing a rated
baseload capacity of no less than one kilowatt and no more than one
hundred kilowatts of electricity, which are located in this state at the
time the qualified fuel cell electric generating equipment is placed in
service.
(ii) Qualified fuel cell electric generating equipment expenditures
shall also include costs, incurred on or after July first, two thousand
five, for materials, labor for on-site preparation, assembly and
original installation, engineering services, designs and plans directly
related to construction or installation and utility compliance costs.
(iii) Such qualified expenditures shall not include interest or other
finance charges.
(iv) The amount of any federal, state or local grant received by the
taxpayer, which was used for the purchase and/or installation of such
equipment and which was not included in the federal gross income of the
taxpayer, shall not be included in the amount of such qualified
expenditures.
(c) Application of credit. The credit allowed under this subdivision
for any taxable year shall not reduce the tax due for such year to less
than the higher amount prescribed in paragraphs (c) and (d) of
subdivision one of this section. However, if the amount of credit
allowed under this subdivision for any taxable year reduces the tax to
such amount, any amount of credit thus not deductible in such taxable
year may be carried over to the following year or years and may be
deducted from the taxpayer's tax for such year or years.
* NB There are 2 sb 37's
* 38. Conservation easement tax credit. (1) Credit allowed. In the
case of a taxpayer who owns land that is subject to a conservation
easement held by a public or private conservation agency, there shall be
allowed a credit for twenty-five percent of the allowable school
district, county and town real property taxes on such land. In no such
case shall the credit allowed under this subdivision in combination with
any other credit for such school district, county and town real property
taxes under this section exceed such taxes.
(2) Conservation easement. For purposes of this subdivision, the term
"conservation easement" means a perpetual and permanent conservation
easement as defined in article forty-nine of the environmental
conservation law that serves to protect open space, scenic, natural
resources, biodiversity, agricultural, watershed and/or historic
preservation resources. Any conservation easement for which a tax credit
is claimed under this subdivision shall be filed with the department of
environmental conservation, as provided for in article forty-nine of the
environmental conservation law and such conservation easement shall
comply with the provisions of title three of such article, and the
provisions of subdivision (h) of section 170 of the internal revenue
code. Dedications of land for open space through the execution of
conservation easements for the purpose of fulfilling density
requirements to obtain subdivision or building permits shall not be
considered a conservation easement under this subdivision.
(3) Land. For purposes of this subdivision, the term "land" means a
fee simple title to real property located in this state, with or without
improvements thereon; rights of way; water and riparian rights;
easements; privileges and all other rights or interests of any land or
description in, relating to or connected with real property, excluding
buildings, structures, or improvements.
(4) Public or private conservation agency. For purposes of this
subdivision, the term "public or private conservation agency" means any
state, local, or federal governmental body; or any private
not-for-profit charitable corporation or trust which is authorized to do
business in the state of New York, is organized and operated to protect
land for natural resources, conservation or historic preservation
purposes, is exempt from federal income taxation under section 501(c)(3)
of the internal revenue code, and has the power to acquire, hold and
maintain land and/or interests in land for such purposes.
(5) Credit limitation. The amount of the credit that may be claimed by
a taxpayer pursuant to this subsection shall not exceed five thousand
dollars in any given year.
(6) Application of the credit. The credit allowed under this
subdivision for any taxable year shall not reduce the tax due for such
year to less than the higher of the amounts prescribed in paragraphs (c)
and (d) of subdivision one of this section. However, if the amount of
the credit allowed under this subdivision for any taxable year reduces
the tax to such amount, any amount of the credit thus not deductible in
such taxable year shall be treated as an overpayment of tax to be
credited or refunded in accordance with the provisions of subsection (c)
of section ten hundred eighty-eight of this chapter, except that, no
interest shall be paid thereon.
* NB There are 3 sb 38's
* 38. Empire state commercial production credit. (a) Allowance of
credit. A taxpayer that is eligible pursuant to provisions of section
twenty-eight of this chapter shall be allowed a credit to be computed as
provided in such section against the tax imposed by this article.
(b) Application of credit. The credit allowed under this subdivision
for any taxable year shall not reduce the tax due for such year to less
than the amount prescribed in paragraph (d) of subdivision one of this
section. Provided, however, that if the amount of the credit allowable
under this subdivision for any taxable year reduces the tax to such
amount, fifty percent of the excess shall be treated as an overpayment
of tax to be credited or refunded in accordance with the provisions of
section one thousand eighty-six of this chapter. Provided, however, the
provisions of subsection (c) of section one thousand eighty-eight of
this chapter notwithstanding, no interest shall be paid thereon. The
balance of such credit not credited or refunded in such taxable year may
be carried over to the immediately succeeding taxable year and may be
deducted from the taxpayer's tax for such year. The excess, if any, of
the amount of credit over the tax for such succeeding year shall be
treated as an overpayment of tax to be credited or refunded in
accordance with the provisions of section one thousand eighty-six of
this chapter. Provided, however, the provisions of subsection (c) of
section one thousand eighty-eight of this chapter notwithstanding, no
interest shall be paid thereon.
* NB Repealed December 31, 2011
* NB There are 3 sb 38's
* 38. Biofuel production credit. A taxpayer shall be allowed a credit,
to be computed as provided in section twenty-eight of this chapter,
against the tax imposed by this article. The credit allowed under this
subdivision for any taxable year shall not reduce the tax due for such
year to less than the higher of the amounts prescribed in paragraphs (c)
and (d) of subdivision one of this section. However, if the amount of
credit allowed under this subdivision for any taxable year reduces the
tax to such amount, any amount of credit thus not deductible in such
taxable year shall be treated as an overpayment of tax to be credited or
refunded in accordance with the provisions of section one thousand
eighty-six of this chapter. Provided, however, the provisions of
subsection (c) of section one thousand eighty-eight of this chapter
notwithstanding, no interest shall be paid thereon.
* NB There are 3 sb 38's
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