Investment

Investment Tax Credit (ITC)

• Credit equals 5% of investment (up to $350 million; 4% rate on amount over $350 million and for personal income taxpayers) in buildings and tangible personal property, acquired by purchase, with a useful life of four years or more and used in production (manufacturing, processing, assembling, agriculture, refining, mining, extracting, farming, horticulture, viticulture, and commercial fishing), qualified film production facilities, waste treatment & pollution control property, or research and development property.
• Optional R&D rate of 9% (the credit is 7% for personal income taxpayers) of qualified investment (see R & D credit below).
• Credit can reduce tax to the higher of the alternative minimum tax or fixed dollar minimum tax (personal income taxpayers may reduce the tax to zero.)
• Credit taken in the year investment made or property placed in service.
• New businesses take a refund of unused credit.
• Unused credits may be carried forward 15 years (10 years for personal income taxpayers).

 

Employment Incentive Credit (EIC)

• Based on the same qualifying investment for the ITC.
• Credit equals from 1.5% to 2.5% of investment, based on increased employment over year prior to investment (1.5% rate if less than 2% increase in employment; 2% rate if 3% increase in employment; 2.5% rate if 3% or greater increase in employment).
• Credit can reduce tax to the higher of the alternative minimum tax or fixed dollar minimum tax.
• Unused credits can be carried forward for 15 years (10 years for personal income taxpayers).
• Credit allowed for each of the two years immediately following the year the ITC was allowed.

 

Investment Tax Credit for the Financial Services Industry

• Taxpayers that are brokers or dealers in securities can receive an ITC for equipment of buildings used in broker/dealer activity.
• The credit is available to qualified general business corporations, banks and insurance companies.
• To be eligible for the credit, taxpayers must meet one of three employment tests and the property must be principally used in qualifying activities.
• Property must be placed in service prior to October 1, 2015.

Research/Emerging Technology

R&D Credit

• An investment tax credit equal to 9% of qualified investment in R&D buildings and tangible personal property (the credit is 7% for personal income taxpayers).
• This credit is taken in place of the regular ITC, and has no employment incentive credit complement.
• Credit can reduce tax to the higher of the alternative minimum tax or fixed dollar minimum tax.
• New businesses take a refund of unused credit.
• Unused credits can be carried forward for 15 years (10 years for personal income taxpayers).

 

Qualified Emerging Technology Company Employment Credit

• Credit of $1,000 per new full-time employee (employees in excess of base year employment level), available for one 3-year period.
• Credit is refundable.

 

Qualified Emerging Technology Company Capital Credit

• Credit equal to a percentage of each qualified investment in a qualified emerging technology company.
• Credit equals 10% for qualified investments that are certified to be held for at least four years (maximum credit per taxpayer of $150,000); 20% for qualified investments certified to be held for at least 9 years (maximum credit per taxpayer of $300,000).
• Credit is not refundable, however, it can be carried forward to future years until it is used up.

 

Qualified Emerging Technology Company Facilities, Operations and Training Credit

• The credit for qualified emerging technology companies equal to the sum of:
  18% of  the cost or other basis for federal income tax purposes of “research and development property” acquired by the taxpayer by purchase and placed in service during the taxable year; 9% for “qualified research expenses” paid or incurred by the taxpayer in the taxable year; and, 100% of “qualified high technology training expenditures” paid or incurred by the taxpayer, up to $4,000 per employee per taxable year.
• An “eligible taxpayer” must:
  have no more than 100 full-time employees, of which at least 75% are employed in New York State; have a ratio of research and development funds to net sales which equals or exceeds 6% during its authorized taxable year; and have gross revenues, along with the gross revenues of its affiliates and related members, not exceeding $20 million for the taxable year immediately preceding the year the taxpayer claims this credit
• An eligible taxpayer may claim these credits 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 (1) may make a revocable election to defer the credit to the first taxable year beginning after such relocation, and (2) shall be eligible for the credit for 5 consecutive taxable years.
• Caps the credit at $250,000 per eligible entity per year.
• Credit is refundable.
• Sunsets on December 31, 2011 (e.g., credit is not applicable for taxable years beginning on/or after January 1, 2012).

 

Alternative Fuel/Energy

Biofuel Production Credit 

• Credit of 15-cents-per-gallon of biofuel produced at a biofuel plant located in New York State after the production of the first 40,000 gallons per year presented to market.
• Credit is capped at $2.5 million per entity, per taxable year, for up to 4 consecutive taxable years per biofuel plant.
• Credit is refundable.

Training

Security Training Tax Credit

• Administered by the State Office of Homeland Security in conjunction with the Tax Department, for qualified building owners, effective for taxable years beginning on/after January 1, 2005. Taxpayers must apply to the State Office of Homeland Security for an allocation of credit and credit certification in order to claim this credit.
• The credit is equal to the sum of the number of qualified security officers providing protection to a building(s) owned by the taxpayer multiplied by $3,000 (where a qualified security officer is employed for less than a full year, such credit amount must be prorated.)
• Credit is refundable.

Other

Automatic External Defibrillator Credit

• Credit equals the cost to the taxpayer of an automated external defibrillator purchased during the taxable year. The credit cannot exceed $500 for each unit purchased; however, there is no limit on the number of units for which the credit may be taken.
• Credit is neither refundable nor able to be carried forward.

 

Long Term Care Insurance Credit 

• Credit equals 20% of premiums paid during the tax year for the purchase of qualifying long-term care insurance.
• Not refundable; unlimited carryforward.

 

Credit for Employment of Persons with Disabilities

• Credit equals 35% of the first $6,000 of first year wages or qualified second year wages paid to a disabled employee (maximum of $2,100 per employee).
• To be eligible, an employee must work for an employer on a full-time basis for at least 180 days or 400 hours, and must be certified by the NYS Department of Labor's Economic Development Service Unit.
• The credit is not refundable, however, it can be carried forward until it is fully used up.

 

Brownfield Tax Credits

• Credits are available for clean-up and development of New York State Brownfields.
• For more information on the Brownfield Real Property Tax Credit, the Brownfield Redevelopment Tax Credit for Rehabiliitated Property, and the Environment Remediation Insurance Tax Credit, click here.

 

Other Tax Credits

• Green Building Credit
• Conservation Easement Tax Credit
• Credit for the Rehabilitation of Historic Properties
• Film Production Credit
• Film Post-Production Credit
• Commercial Production Credit

 

More resources

Publication 112, General Information on New York State State Tax Credits for Article 9-A Businesses.

 

Contacts

NYS Department of Taxation and Finance
Tax and Finance Contact Numbers
Corporate Tax Information:                    (518) 485-6027
Sales Tax Information:                            (518) 485-2889
Miscellaneous Business Tax information:  (518) 457-5735