Senate Bill S5955

                            
                    S T A T E   O F   N E W   Y O R K
________________________________________________________________________

                                  5955

                       2009-2010 Regular Sessions

                            I N  S E N A T E

                              June 19, 2009
                               ___________

Introduced  by  Sen.  KRUGER -- read twice and ordered printed, and when
  printed to be committed to the Committee on Rules

AN ACT to amend the tax law, in relation to an investment tax credit

  THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
BLY, DO ENACT AS FOLLOWS:

  Section  1.  Subparagraph  (i)  of  paragraph (b) of subdivision 12 of
section 210 of the tax law, as amended by chapter 637  of  the  laws  of
2008, is amended to read as follows:
  (i)  A  credit shall be allowed under this subdivision with respect to
tangible personal property and other tangible property, including build-
ings and structural components  of  buildings,  which  are:  depreciable
pursuant  to  section  one  hundred sixty-seven of the [internal revenue
code] 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] 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 facil-
ities 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  securi-
ties  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 compa-
ny as defined in section eight hundred fifty-one of the Internal Revenue

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD10639-03-9
              

S. 5955                             2

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,
(E-1) PRINCIPALLY USED IN THE ORDINARY COURSE OF THE TAXPAYER'S TRADE OR
BUSINESS  OF  PROVIDING  INVESTMENT ADVISORY SERVICES, OR THE SERVICE OF
MANAGING INVESTMENT PORTFOLIOS TO ACHIEVE SPECIFIC INVESTMENT OBJECTIVES
FOR ACCOUNTS OVER ONE MILLION DOLLARS OF ACCREDITED INVESTORS  (AS  THAT
TERM  IS  DEFINED  IN  RULE 501 OF REGULATION D OF THE SECURITIES ACT OF
1933), IF THE TAXPAYER SATISFIES THE FOLLOWING CRITERIA: (I) THE TAXPAY-
ER IS A REGULATED BROKER OR DEALER OR AN AFFILIATE OF A REGULATED BROKER
OR DEALER, (II) THE TAXPAYER IS  REGISTERED  AS  AN  INVESTMENT  ADVISER
UNDER  SECTION  TWO HUNDRED THREE OF THE INVESTMENT ADVISER ACT OF 1940,
AS AMENDED, AND (III) AT LEAST ONE CLIENT OF THE TAXPAYER IS A REGULATED
INVESTMENT COMPANY AS DEFINED IN SECTION EIGHT HUNDRED FIFTY-ONE OF  THE
INTERNAL  REVENUE  CODE THAT HAS ASSETS IN EXCESS OF ONE HUNDRED MILLION
DOLLARS, (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 enti-
ty 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), (E-1) and (F) of this subparagraph, property purchased
by a taxpayer affiliated with a  regulated  broker,  dealer,  registered
investment  adviser,  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,  registered  investment adviser,
national securities exchange or board of trade in accordance  with  this
subdivision.  For purposes of determining if the property is principally
used in qualifying uses, the uses by the taxpayer described  in  clauses
(D)  [and],  (E),  AND  (E-1) of this subparagraph may be aggregated. In
addition, the uses by the taxpayer,  its  affiliated  regulated  broker,
dealer,  and registered investment adviser under [either or both] ANY of
those clauses may be aggregated.   Provided, however, a  taxpayer  shall
not be allowed the credit provided by clauses (D), (E), (E-1) and (F) of
this  subparagraph  unless  (I)  eighty percent or more 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 or (II) the average number of employees that perform the  adminis-
trative  and support functions resulting from or related to the qualify-
ing uses of such equipment and are located  in  this  state  during  the
taxable year for which the credit is claimed is equal to or greater than
ninety-five  percent  of  the  average  number of employees that perform
these functions and are located in  this  state  during  the  thirty-six
months  immediately  preceding the year for which the credit is claimed,

S. 5955                             3

or (III) the number of employees located in this state during the  taxa-
ble  year  for  which  the credit is claimed is equal to or greater than
ninety percent of the number of  employees  located  in  this  state  on
December thirty-first, nineteen hundred ninety-eight or, if the taxpayer
was  not  a calendar year taxpayer in nineteen hundred ninety-eight, the
last day of its first taxable year ending after  December  thirty-first,
nineteen hundred ninety-eight. If the taxpayer becomes subject to tax in
this  state after the taxable year beginning in nineteen hundred ninety-
eight, then the taxpayer is not required to satisfy the employment  test
provided  in  the  preceding sentence of this subparagraph for its first
taxable year. For purposes of clause  (III)  of  this  subparagraph  the
employment test will be based on the number of employees located in this
state  on the last day of the first taxable year the taxpayer is subject
to tax in this state. If the uses of the property must be aggregated  to
determine  whether  the property is principally used in qualifying uses,
then either each affiliate using the property must satisfy this  employ-
ment  test  or this employment test must be satisfied through the aggre-
gation of the  employees  of  the  taxpayer,  its  affiliated  regulated
broker,  dealer,  and  registered investment adviser using the property.
For purposes of this subdivision, the term  "goods"  shall  not  include
electricity.
  S 2. This act shall take effect immediately.