New York Basic Business Taxes 2011
New York's economic development, finance, and tax organizations provide a range of incentive programs to initiate new business and commercial investment. Specific programs include corporate income tax, investment tax credits, and the Excelsior Jobs Program.
Area Development Research Desk (March 2011)
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A QETC 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 five consecutive taxable years. Cap on the credit is $250,000 per eligible taxpayer per year. Credit can reduce tax to the higher of the AMT or fixed dollar minimum (for corporate taxpayers). Unused credits are refundable. This credit sunsets on December 31, 2011 (e.g., credit is not applicable for taxable years beginning on/after January 1, 2012).
Biofuel Production Credit
A credit is available for biofuel produced at a biofuel plant in New York State on or after January 1, 2006. The credit is equal to 15-cents-per gallon after the production of the first 40,000 gallons per year presented to market. The credit is capped at $2.5 million per entity, per taxable year, for up to no more than four consecutive taxable years per biofuel plant.
Empire State Film Production Credit - A refundable credit against corporate franchise (income) tax and personal income tax for qualified film production companies, or sole proprietors of qualified film production companies.
oThe credit is the product of 30 percent and the qualified production costs paid or incurred in the production of a qualified film, provided that at least 75% of the production costs ("stagework") are spent in New York State.
oThe credit is allowed for the taxable year in which the production of such qualified film is completed.
o"Qualified Film" excludes documentary films, news or current events programs, interview or talk programs, game shows, award ceremonies, sports programming, soap operas, commercials, music videos, or "reality" programs.
o$420 million ("Additional pool 2") has been allocated for this credit for each of years 2010-2014.
oCredits are paid as follows:
•Credits for less than $1 million will be paid in full in State fiscal year 2009-10;
•Credits between $1-$5 million will be paid out 50 percent in each of State fiscal years 2009-10 and 2010-11;
•Credits greater than $5 million will be paid out in 33 percent increments in each of State fiscal years 2009-10, 2010-11, and 2011-12.
•Credit is available for tax years ending on/before December 31, 2014.
• New York City is authorized to allow this credit against NYC tax; NYC credit is 5 percent of qualified production costs; NYC program capped at $12.5 million per year.
Empire State Film Post Production Credit - Up to $7 million of the Empire State Film Production Credit must be made available annually for this new credit, which will be allocated by the Governor's Office of Motion Picture and Television Development in the same manner as the Empire State Film Production Credit.
•Credit is equal to 10 percent of qualified post-production costs, available to a qualified film production company, (unless such company is eligible for the Empire State Film Production Credit).
•To be eligible, qualified post-production costs at a qualified post production facility must meet or exceed 75 percent of the total post production costs at any post production facility.
•Note: Any qualified post production costs used by a taxpayer as the basis for this credit cannot be used by the taxpayer to claim any other credit.
•Credit is 50 percent refundable in year 1, with the remainder carried forward to the immediately succeeding taxable year, where any remaining unused credit is refundable in that year.
Empire State Commercial Production Tax Credit - This credit is provided to a taxpayer that is a qualified commercial production company, or a partner of a partnership (including a member of a limited liability company that is treated as a partnership for federal income tax purposes) that is a qualified commercial production company. (A New York S-corporation may not use this credit against its own tax; instead, the credit is provided to its shareholders who are subject to tax under Article 22 of the Tax Law.)
To be eligible for this credit, at least 75 percent of the production costs (excluding post production costs) paid or incurred directly and predominately in the actual filming or recording of a qualified commercial must be incurred in New York State.
New York will provide $7 million of credit annually to be disbursed to all eligible
commercial production companies as follows:
•Growth Credit ($3 million) - a refundable credit equal to 20 percent of the qualified production costs attributable to the use of tangible property or the performance of services in New York in the production of a qualified commercial. Total qualified production costs must be greater in the current year than the average of the three previous years for which the credit was applied. However, until a qualified production company has established a three-year history for the credit, the benchmark for the credit will be the greater of the previous year's or the average of the two previous years' qualified production costs. If the qualified production company has never applied for the credit, the previous year's data will be used to create a benchmark. The credit is applied only to the excess of the current calendar year's costs over the previous calendar year's cost. The annual $3 million cap will be disbursed on a pro rata basis to all eligible commercial production companies. No qualified production company will be allocated more than $300,000 of credit annually. The credit is allowed for the tax year in which the production of the qualified commercial is completed.
•Downstate Credit ($3 million) -a refundable credit equal to 5 percent of the qualified production costs attributable to the use of tangible property or the performance of services in New York in the production of the qualified commercial within the Metropolitan Commuter Transportation District (MCTD, which includes New York City and the counties of Dutchess, Nassau, Orange, Putnam, Rockland, Suffolk, and Westchester). Total qualified production costs in the current calendar year must be greater than $500,000 and the credit applies only to such costs exceeding $500,000. The annual $3 million cap will be disbursed on a pro rata basis.
•Upstate Credit ($1 million) - a refundable credit equal to 5 percent of the qualified production costs attributable to the use of tangible property or the performance of services in New York in the production of the qualified commercial outside the MCTD. Total qualified production costs in the current calendar year must be greater than $200,000, and the credit applies only to such costs exceeding $200,000. The annual $1 million cap will be disbursed on a pro rata basis.
The credit may not reduce the tax due to less than the fixed dollar minimum tax.
The amount of credit not applied to the tax in the current tax year (the excess credit) may be refunded or credited as an overpayment to next year's tax. The refund is limited to 50 percent of the excess credit in the current year; the balance may be carried forward to the following year and may be deducted from the tax in that year. The amount of the excess credit not applied to the tax in the next succeeding tax year will be credited or refunded (without interest). Production costs used as the basis for allowance of this credit or used in the calculation of this credit cannot be used to claim any other credit.
This program expires December 31, 2011. (The Empire State commercial production tax credit is administered by the Governor's Office for Motion Picture and Television Development, email@example.com).