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Assembly Actions -
Lowercase Senate Actions - UPPERCASE |
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| Mar 31, 2014 |
signed chap.59 delivered to governor returned to senate passed assembly ordered to third reading rules cal.34 substituted for a8559d referred to ways and means delivered to assembly passed senate ordered to third reading cal.376 |
| Mar 28, 2014 |
print number 6359d |
| Mar 28, 2014 |
amend (t) and recommit to finance |
| Mar 14, 2014 |
print number 6359c |
| Mar 14, 2014 |
amend and recommit to finance |
| Feb 21, 2014 |
print number 6359b |
| Feb 21, 2014 |
amend and recommit to finance |
| Feb 12, 2014 |
print number 6359a |
| Feb 12, 2014 |
amend (t) and recommit to finance |
| Jan 21, 2014 |
referred to finance |
Senate Bill S6359D
Signed By Governor2013-2014 Legislative Session
Enacts into law major components of legislation necessary to implement the state fiscal plan for the 2014-2015 fiscal year
download bill text pdfSponsored By
There are no sponsors of this bill.
Archive: Last Bill Status - Signed by Governor
- Introduced
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- In Committee Assembly
- In Committee Senate
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- On Floor Calendar Assembly
- On Floor Calendar Senate
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- Passed Assembly
- Passed Senate
- Delivered to Governor
- Signed By Governor
Actions
Votes
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Floor Vote: Mar 31, 2014
aye (51)- Addabbo Jr.
- Avella
- Ball
- Bonacic
- Boyle
- Breslin
- Carlucci
- DeFrancisco
- Diaz
- Dilan
- Farley
- Felder
- Flanagan
- Gallivan
- Gianaris
- Gipson
- Golden
- Griffo
- Grisanti
- Hannon
- Hassell-Thompson
- Kennedy
- Klein
- LaValle
- Lanza
- Larkin
- Latimer
- Libous
- Little
- Marcellino
- Marchione
- Martins
- Maziarz
- Nozzolio
- O'Brien
- O'Mara
- Peralta
- Ranzenhofer
- Ritchie
- Robach
- Sampson
- Savino
- Seward
- Skelos
- Smith
- Stavisky
- Stewart-Cousins
- Tkaczyk
- Valesky
- Young
- Zeldin
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Mar 31, 2014 - Finance Committee Vote
S6359D28Aye0Nay9Aye with Reservations0Absent0Excused0Abstained -
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Bill Amendments
2013-S6359 - Details
2013-S6359 - Summary
Enacts into law major components of legislation necessary to implement the state fiscal plan for the 2014-2015 state fiscal year; relates to the reformation of the taxation on business corporations; allows direct payment of STAR savings; extends fees for the establishment of oil and gas unit of production value
2013-S6359 - Sponsor Memo
BILL NUMBER:S6359
TITLE OF BILL: An act to amend the tax law, the general municipal
law, the urban development corporation act, the business corporation
law, the general associations law, and the administrative code of the
city of New York, in relation to reforming taxation of business
corporations; and to repeal various provisions of the tax law relating
thereto (Part A); to amend the real property tax law, in relation to
the STAR registration program (Part B); to amend chapter 540 of the
laws of 1992, amending the real property tax law relating to oil and
gas charges, in relation to the effective date of such chapter (Part
C); to amend the racing, pari-mutuel wagering and breeding law, in
relation to increasing racing regulatory fees (Part D); to amend the
tax law, in relation to modifying the signature requirement on e-filed
returns prepared by tax professionals (Part E); to amend the real
property tax law, in relation to cost of living adjustments for
Enhanced STAR (Part F); to amend part I of chapter 58 of the laws of
2006, relating to providing an enhanced earned income tax credit, in
relation to the effectiveness thereof (Part G); to amend the general
obligations law and the tax law, in relation to authorizing electronic
tax clearances for professional and business licenses (Part H); to
amend the tax law and the administrative code of the city of New York,
in relation to taxing residents who are grantors of exempt resident
trusts that qualify as non-grantor incomplete gift trusts on the
income from such trusts and taxing residents who are beneficiaries of
all other exempt resident trusts or nonresident trusts on the
distributions of accumulated income that they receive from such trusts
(Part I); to amend the tax law and the administrative code of the city
of New York, in relation to eliminating the personal income tax add-on
minimum tax; and to repeal certain provisions of such laws relating
thereto (Part J); to amend the tax law, in relation to adding an
enhanced real property tax circuit breaker; and to repeal paragraph 14
of subsection (e) of section 606 of the tax law, relating to certain
reports (Part K); to amend the tax law, in relation to providing a
credit for renters against the personal income tax (Part L); to amend
the tax law, in relation to the prepayment element of the family tax
relief credit (Part M); to amend the tax law, in relation to
eliminating the personal income tax filing requirement for residents
having no liability because income does not exceed the New York
standard deduction if they do not file a federal income tax return
(Part N); to amend the tax law, in relation to extending the empire
state commercial production tax credit (Part O); to amend the public
housing law, in relation to extending the credit against income tax
for persons or entities investing in low-income housing (Part P); to
amend the environmental conservation law, the tax law and the general
municipal law, in relation to eligibility for participation in the
brownfield cleanup program, and assignment of the brownfield
redevelopment tax credits; to amend part H of chapter 1 of the laws of
2003, amending the tax law relating to brownfield redevelopment tax
credits, remediated brownfield credit for real property taxes for
qualified sites and environmental remediation insurance credits, in
relation to tax credits for certain sites; to amend the environmental
conservation law, in relation to hazardous waste generator fees and
taxes; to amend the environmental conservation law, the public
authorities law and the state finance law, in relation to the
environmental restoration program; and to repeal certain provisions of
the environmental conservation law and the tax law relating thereto
(Part Q); to amend the tax law, in relation to reforming the
investment tax credit, reducing the tax rate for upstate manufacturers
and providing a tax credit for real property taxes to New York
manufacturers; to amend the economic development law, in relation to
the excelsior investment tax credit; and to repeal certain provisions
of the tax law relating to the financial services investment tax
credit (Part R); to amend the economic development law, the tax law,
the transportation law, the administrative code of the city of New
York and the New York state urban development corporation act, in
relation to repealing the franchise tax on farmers', fruit growers',
and other like agricultural corporations organized and operated on a
co-operative basis; and to repeal section 185 of the tax law relating
to franchise tax on farmers', fruit growers', and other like
agricultural corporations organized and operated on a co-operative
basis; to repeal sections 187-j, 187-k, 187-l, 187-m, 187-q, 187-r and
187-s of the tax law relating to certain tax credits; to repeal
paragraph 1 of subdivision (h) of section 15, paragraph 1 of
subdivision (g) of section 31, and certain other provisions of the tax
law, in relation to making conforming changes (Part S); to amend the
tax law, in relation to providing a credit for excise tax on
telecommunication services for businesses located in tax-free NY areas
(Part T); to amend the tax law, in relation to reducing the number of
hours of part-time work needed by employees for employer qualification
for the New York youth works tax credit; and to amend the labor law,
in relation to the New York youth works tax credit (Part U); to amend
chapter 109 of the laws of 2006 amending the tax law and other laws
relating to providing exemptions, reimbursements and credits from
various taxes for certain alternative fuels, in relation to extending
the alternative fuels tax exemptions for two years (Part V); to amend
chapter 63 of the laws of 2000, amending the tax law and other laws
relating to modifying the distribution of funds from the motor vehicle
fuel excise tax and the vehicle and traffic law, in relation to
simplifying the methodology for distribution of motor vehicle receipts
(Part W); to amend the tax law, in relation to the estate tax; to
repeal section 2 of chapter 1013 of the laws of 1962, amending the tax
law relating to imposing a tax on the transfer of estates of decedents
dying on or after April first, nineteen hundred sixty-three, relating
to an appendix of applicable internal revenue code provisions, and to
repeal article 26-B of the tax law, relating to the generation
skipping transfer tax (Part X); to amend the tax law and chapter 912
of the laws of 1920 relating to the regulation of boxing, sparring and
wrestling matches, in relation to making technical corrections
thereto; to repeal article 19 of the tax law relating to boxing and
wrestling exhibitions tax; and to repeal section 1820 of the tax law
relating to establishing misdemeanors for certain violations of
article 19 of such law (Part Y); to amend the tax law, in relation to
vendor fees paid to vendor tracks (Part Z); to amend the racing,
pari-mutuel wagering and breeding law, in relation to licenses for
simulcast facilities, sums relating to track simulcast, simulcast of
out-of-state thoroughbred races, simulcasting of races run by
out-of-state harness tracks and distributions of wagers; to amend
chapter 281 of the laws of 1994 amending the racing, pari-mutuel
wagering and breeding law and other laws relating to simulcasting and
chapter 346 of the laws of 1990 amending the racing, pari-mutuel
wagering and breeding law and other laws relating to simulcasting and
the imposition of certain taxes, in relation to extending certain
provisions thereof; and to amend the racing, pari-mutuel wagering and
breeding law, in relation to extending certain provisions thereof
(Part AA); to amend the tax law, in relation to capital awards to
vendor tracks (Part BB); to amend the tax law, the banking law, the
public authorities law, and the administrative code of the city of New
York, in relation to the stock transfer tax, and to repeal certain
provisions of the tax law, the state finance law and the
administrative code of the city of New York relating thereto (Part
CC); to amend the tax law, in relation to conforming the due dates for
the metropolitan commuter transportation mobility tax for taxpayers
with income from self-employment with the due dates for the personal
income tax (Part DD); to amend the state finance law, the upstate New
York gaming economic development act of 2013 and the tax law, in
relation to moneys appropriated or transferred from the commercial
gaming revenue fund (Part EE); and to amend the tax law, the education
law, the general municipal law, and the real property tax law, in
relation to a real property tax freeze (Part FF)
PURPOSE:
This bill contains provisions needed to implement the Revenue portion
of the 2014-15 Executive Budget.
This memorandum describes Parts A through FF of the 2014-15 Article
VII Revenue bill which are described wholly within the parts listed
below.
Part A - Corporate tax reform
Purpose:
This bill would establish a single modern system of taxation for
general business corporations and banking corporations by repealing
the separate provisions of the Tax Law for banking corporations (Tax
Law Article 32) and amending the business corporation tax under
Article 9-A to accommodate changes in the financial services industry
and make other modernization changes.
Statement in Support, Summary of Provisions, Existing Law, and Prior
Legislative History:
The State's current corporate franchise tax structure, which dates
back to the 1940's, is outdated, unduly complex and vulnerable to
aggressive tax avoidance techniques. It violates basic tax policy
principles by taxing similarly-situated taxpayers differently, and in
some instances it creates disincentives to increasing a corporation's
activities in New York. One significant example of the shortcoming of
the current tax structure is that it has not been revised to account
for dramatic changes in the financial services sector. New York
continues to tax banks and other financial corporations under
different articles of the Tax Law. Thus, a bank and a non-bank
financial institution would be taxed differently, even though they are
conducting the same activities. Further, many large financial services
firms provide bank and non-bank financial services within the same
company. This can result in confusion and complexity due to different
rules of taxation under Article 9-A and Article 32. Approximately 25
percent of the combined Article 9-A and Article 32 revenue is
collected on audit.
New York's current sourcing rules fail to acknowledge the shift to a
service-based economy. Companies that generate significant receipts
from services can incur greater tax liability if they increase their
activity in New York. This reform proposal would source a business's
receipts to the location of its customers. This assigns income to
various states based on where the customers are located and eliminates
factors that would increase tax if a company increased its activity in
New York. This removes a previous disincentive to locating in New
York.
Complexities within the tax system also complicate tax compliance.
This creates disruptions and uncertainty for businesses while
increasing administration costs for New York State and results in
extremely volatile tax collections that are difficult to forecast and
can have dramatic effects on the State's financial plan.
This reform proposal addresses the above issues by modernizing the tax
code to make it more reflective of the current business environment,
and creates clarity and certainty for the most commonly disputed
areas. This certainty, combined with the elimination of impediments to
businesses wishing to expand their New York activity, will make New
York's corporate tax system more competitive with other states.
Highlights of the reforms and structural changes made by the bill
include (1) the repeal of both Article 32 and the organization and
license taxes and maintenance fees in Tax Law sections 180 and 181 and
(2) the replacement of the entire net income base with a similar
business income base subject to a fully effective tax rate of 6.5
percent (effective January 1, 2016) as compared to the existing 7.1
percent rate.
Both the New York State Tax Relief Commission and the New York State
Tax Reform and Fairness Commission highlighted the need for New York
corporate tax reform and specifically identified the different rules
under which banks and other corporations are taxed.
This is a new bill.
Budget Implications:
Enactment of this bill is necessary to implement the 2014-2015
Executive Budget because it would reduce revenues by $205 million in
SFY 2015-16 and $346 million annually thereafter.
Effective Date:
This bill takes effect January 1, 2015 and applies to taxable years
beginning on or after January 1, 2015.
Part B - Allow direct payment of STAR tax savings in certain cases.
Purpose:
This bill would allow the Department of Taxation and Finance to pay
the STAR tax savings directly to eligible property owners who register
for STAR after receiving their 2014-15 school tax bills.
Statement in Support, Summary of Provisions, Existing Law, and Prior
Legislative History:
The STAR Registration Program was enacted as part of the 2013-14 State
Budget to eliminate inappropriate "Basic STAR" exemptions while
enabling qualified owners to receive their rightful tax relief. The
law permits late registrations under certain conditions, so it is
possible that a limited number of property owners may seek to register
after receiving their 2014-15 school tax bills. While there is a
mechanism in current law to restore a STAR exemption after a school
tax bill has been issued, it is a process that forces the property
owner to wait for a refund while local government and school district
personnel process the necessary paperwork. This proposal would allow
the Tax Department to directly reimburse these property owners without
delay, while sparing local officials the need to bear administrative
burdens in support of this State program.
Budget Implications:
Enactment of this bill is necessary to implement the 2014-15 Executive
Budget and to allow late registrants to be reimbursed promptly for the
value of their lost STAR exemptions.
Effective Date:
This bill takes effect immediately.
Part C - Extend fees for the establishment of oil and gas unit of
production values
Purpose:
This bill would extend fees for the establishment of oil and gas unit
of production values by the Department of Taxation and Finance (the
Department).
Statement in Support, Summary of Provisions, Existing Law, and Prior
Legislative History:
The Department establishes "unit of production values" which local
assessors must use when assessing oil and gas wells and related
facilities, pursuant to Article 5, Title 5 of the Real Property Tax
Law. This program, which has been in place since 1981, relieves local
assessors of the burden of attaining the necessary expertise to value
these properties, while assuring producers that their assessments will
be determined on a uniform, rational basis throughout the State.
In recognition of the benefit this program provides for the industry,
producers have been obliged since 1992 to pay fees to the State to
offset the administrative costs involved in developing these values.
The statute imposing those fees - § 593 of Real Property Tax Law - has
always been subject to a sunset clause, and has been repeatedly
renewed since enactment. This bill would extend the program until
2018.
Budget Implications:
Enactment of this bill is necessary to implement the 2014-15 Executive
Budget and allow the Department to offset related costs.
Effective Date:
This bill takes effect immediately.
Part D - Increase racing regulatory fee from 0.5 percent to 0.6
percent
Purpose:
This bill would increase the racing regulatory fee on thoroughbred,
harness, off-track pari-mutuel betting and simulcast racing from 0.5
percent to 0.6 percent.
Statement in Support, Summary of Provisions, Existing Law, and Prior
Legislative History:
Regulation of the horse racing industry is intended to be
self-financing-paid for entirely by the industry. However, the cost of
regulating the industry has consistently exceeded the revenues
collected by the industry. This bill ensures that assessments on the
industry are sufficient to meet the cost of regulation.
Budget Implications:
Enactment of this bill is necessary to implement the 2014-15 Executive
Budget and will generate an additional $1.6 million annually.
Effective Date:
This bill takes effect immediately.
Part E - Modify signature requirements on e-filed returns prepared by
tax professionals
Purpose:
This bill would modify the signature requirements on e-filed returns
prepared by tax professionals.
Statement in Support, Summary of Provisions, Existing Law, and Prior
Legislative History:
This bill reflects the recommendation of the New York State Tax Reform
and Fairness Commission that the signature requirement for e-filed
returns be modified It would allow taxpayers to use electronic
signatures when authorizing their tax preparers to e-file their tax
returns and related documents. This would make the process less
burdensome for tax professionals and serve to further reduce barriers
to electronic filing.
Budget Implications:
Enactment of this bill is necessary to implement the 2014-2015
Executive Budget. It would implement a tax simplification
recommendation of the Tax Reform and Fairness Commission and has no
impact on the State's Financial Plan.
Effective Date:
This bill takes effect immediately.
Part F - Eliminate the Income Threshold Inflation Adjustment For
Enhanced STAR Benefits
Purpose:
This bill eliminates the annual cost of living adjustment for the
income standard applicable to the Enhanced STAR exemption under the
STAR program.
Statement in Support, Summary of Provisions, Existing Law, and Prior
Legislative History:
This bill amends RPTL § 425(4) by eliminating the annual cost of
living adjustment made to the income standard for Enhanced STAR
eligibility beginning with the 2015-16 school year, effectively
freezing the income threshold at $81,900. Existing law requires that
the income threshold applicable for Enhanced STAR eligibility be
adjusted annually to account for a cost-of-living adjustment
percentage.
STAR was enacted in 1997 to offset rising property taxes for
homeowners and to provide additional targeted property tax relief to
senior citizens. Since that time, a number of program enhancements
have been made that contributed to increases in the current and
projected cost of the STAR program. The costs of the STAR program
increased approximately 32% between 2001-02 and 2012-13. The direct
costs of the STAR program, including reimbursements made under RPTL
1306-a and State Finance Law § 54-f, in 2012-13 were over $3.3
billion. Capping the growth of the direct costs to the State of the
program at current levels will limit spending at the State level and
is critical for a balanced State budget.
Budget Implications:
Eliminating the annual cost of living adjustment will reduce General
Fund spending by $3.1 million in SFY 2015-16.
Effective Date:
This bill takes effect immediately and applies to assessment rolls
completed in 2015 and thereafter.
Part G - Extend the Noncustodial Parent Earned Income Tax Credit for
Two Years
Purpose:
This bill would extend the noncustodial parent earned income tax
credit for two years, through tax year 2016.
Statement in Support, Summary of Provisions, Existing Law, and Prior
Legislative History:
The credit is available to noncustodial parents who pay child support
for a qualifying child with whom they do not reside. This credit
rewards noncustodial parents who are working, and it provides a
substantial work incentive for those not working or working
intermittently. The credit is intended to encourage low-income
noncustodial parents to comply with child support orders. It is also
intended to encourage low-income noncustodial parents to become more
involved in the economic and social well-being of their children.
The credit currently applies to taxable years beginning before January
1, 2015. This bill would extend the credit for two years through tax
year 2016.
Budget Implications:
Enactment of this bill is necessary to implement the 2014-2015
Executive Budget because it would decrease All Funds tax receipts by
$4 million in each of SFYs 2016-17 and 2017-18.
Effective Date:
This bill takes effect immediately.
Part H - Mandate for professional and business licenses electronic tax
clearance upon application or renewal
Purpose:
This bill would create a new program to aid in enforcing and
collecting past-due tax liabilities by preventing applicants from
receiving or renewing professional or business licenses if they owe
certain past-due tax liabilities.
Statement in Support, Summary of Provisions, Existing Law, and Prior
Legislative History:
Under the Governor's direction, the State has initiated one of the
most comprehensive one-stop electronic licensing initiatives in the
country. This bill would further the Governor's initiative by
requiring an electronic tax clearance when a professional or business
license is sought or renewed. In return for the privilege of receiving
such license, an applicant with fixed and final tax liabilities would
be required either to pay the past-due tax liabilities or to enter
into a payment agreement with the Department of Taxation and Finance.
The bill would also permit electronic sales tax registration
clearances for licenses related to business activities that require
such registrations.
The bill would build on the successful driver's license tax clearance
program enacted as part of the 2013-14 Budget and on the General
Obligations Law § 3-503 license clearance requirements related to
delinquent child support obligations. By using modern electronic
processing systems, there would be no inconvenience to applicants
without tax liabilities, because these liability checks would run
seamlessly in the background as the license application is processed.
If the applicant's tax clearance is refused, the government agency
processing the application would provide notice to the applicant to
contact the Tax Department.
Budget Implications:
Enactment of this bill is necessary to implement the 2014-2015
Executive Budget, because it would increase All Funds receipts by $3
million in SFY 2015-16 and annually thereafter.
Effective Date:
The bill would take effect on June 1, 2014, provided, however, that
the Department of Taxation and Finance and any government entity
electing to receive an electronic tax clearance from the Department of
Taxation and Finance may work to execute the necessary procedures and
technical changes to support the electronic tax clearance process as
described in sections one and two of this act before that date;
provided, further, that this effective date would not impact the
administration of any electronic tax clearance program authorized by
any other provision of law.
Part I - Close the resident trust loophole
Purpose:
This bill would amend the Tax Law to ensure that certain income earned
by trusts is properly subject to New York income tax.
Statement in Support, Summary of Provisions, Existing Law, and Prior
Legislative History:
This bill would amend the Tax Law to make two improvements to the
taxation of trusts. First, the bill would tax distributions of
accumulated trust income to New York beneficiaries of non-resident
trusts and exempt resident trusts. Second, the bill would eliminate a
loophole that allows incomplete gift, non-grantor trusts set up by New
York residents to completely avoid New York income tax. These two
amendments reflect the proposals included in the November 18, 2013
report made by the Trusts and Estates section of the New York State
Bar Association to the Tax Reform and Fairness Commission.
In general, from an income tax perspective, income that is earned by a
trust may be included in the income of the grantor, the trust, or the
beneficiaries of the trust. Under the Tax Law, however, the
accumulated income (i.e the income of a trust that is not distributed
to a beneficiary) of several types of trusts is not subject to any New
York tax at the grantor level, the trust level, or the beneficiary
level. The categories of trusts for which all or a portion of their
accumulated income is not currently subject to New York income tax
include:
(1) non-resident trusts (i .e. a trust whose grantor is not domiciled
in New York at the time the trust became irrevocable);
(2) exempt resident trusts (i.e. trusts that are exempt from New York
income taxation because three conditions in Tax Law § 605(b)(3) are
satisfied); and
(3) incomplete gift, non-grantor or "ING" trusts (i.e certain trusts
that are specifically structured (i) so that the settlor's transfer of
property to the trust is an incomplete gift and (ii) to avoid grantor
trust status under Sections 671 through 678 of the Internal Revenue
Code, Title 26, United States Code.
This bill would remedy this problem by (1) taxing New York
beneficiaries of non-resident trusts and exempt resident trusts on the
accumulated income of the trusts when the income is distributed to the
beneficiary and (2) including the income of an ING trust established
by a New York resident in the current income of its grantor. The bill
would also provide a credit for non-resident trust and exempt resident
trust beneficiaries for taxes paid to other jurisdictions, require
non-resident trusts and exempt resident trusts to file information
returns, and make conforming changes to the New York City
Administrative Code.
This bill would be effective immediately and be applicable to tax
years beginning on or after January 1, 2014 To mitigate transition
issues, however, the section excludes from tax. (1) distributions of
accumulated income by exempt resident trusts (except ING trusts) made
before June 1, 2014, and (2) income earned by ING trusts that are
liquidated on or before June 1, 2014.
Budget Implications:
Enactment of this bill is necessary to implement the 2014-15 Executive
Budget because it would increase tax revenues by $75 million in SFY
2014-15, $225 million in SFY 2015-16, and $150 million annually
thereafter.
Effective Date:
This bill takes effect immediately and applies to taxable years
beginning on or after January 1, 2014, provided that sections 1 and 6
do not apply to distributions occurring before June 1, 2014, while
sections 2 and 7 do not apply to income earned by trusts covered by
those section that are liquidated prior to June 1, 2014.
Part J - Repeal the additional minimum personal income tax Purpose
This bill would repeal the personal income tax "add-on" minimum tax.
Statement in Support, Summary of Provisions, Existing Law, and Prior
Legislative History:
This bill would implement the recommendation of the New York State Tax
Reform and Fairness Commission that the additional minimum personal
income tax be repealed. The Commission found that this tax pre-dates
the 1986 tax reforms and pertains to only 200 taxpayers with minimal
revenue generated.
New York has been penalized in tax rankings because, among other
things, provisions like the add-on minimum tax make the State's tax
code unnecessarily complex and burdensome This bill would repeal the
additional tax, thereby helping to streamline the tax code to further
the Commission's goal of making it less complex and burdensome.
This bill would also make conforming changes to New York City's add-on
minimum tax.
Budget Implications:
Enactment of this bill is necessary to implement the 2014-2015
Executive Budget. It would implement a tax simplification
recommendation of the Tax Reform and Fairness Commission and has
minimal impact on the State's Financial Plan.
Effective Date:
This bill takes effect immediately and applies to taxable years
beginning on or after January 1, 2014.
Part K - Establish the Residential Real Property Personal Income Tax
Credit
Purpose:
This bill would create a new enhanced property tax circuit break
credit for low- and middle-income homeowners.
Statement in Support, Summary of Provisions, Existing Law, and Prior
Legislative History:
New York homeowners pay some of the highest property tax bills in the
nation, whether measured in absolute terms or as a percentage of
income or home value. Property taxes have seriously burdened New
York's working families and senior citizens. While progress has been
made and should continue under the existing property tax cap, there is
also a need to help New York's overburdened homeowners based on
ability to pay.
This bill, a recommendation of the Tax Reduction Commission, would
create a new real property tax circuit breaker that offers larger
credit amounts for all taxing jurisdictions that stay within the
property tax cap. The credit is targeted to help low-income and middle
class New York homeowners with qualifying incomes up to $200,000. The
credit value rises with the size of the homeowner's property tax
burden. The bill would also keep the existing circuit breaker in place
so that New York homeowners currently benefiting from the circuit
breaker are not denied a benefit if their taxing jurisdictions do not
comply with the property tax cap.
Budget Implications:
Enactment of this bill is necessary to implement the 2014-2015
Executive Budget. It would implement a reform recommendation of the
Tax Reduction Commission and reduce All Funds receipts by a total of
$200 million in SFY 2015-16, by $525 million in SFY 2016-17, and by $1
billion annually thereafter.
Effective Date:
This bill takes effect immediately and applies to taxable years
beginning on or after January 1, 2014.
Part L - Establish a renter's personal income tax credit Purpose:
This bill would provide a credit against the personal income tax for
eligible renters.
Statement in Support, Summary of Provisions, Existing Law, and Prior
Legislative History:
This bill would provide a personal income tax credit for eligible low
and middle income taxpayers who rent their primary residences. This
credit may be taken in lieu of the current real property tax circuit
breaker credit for renters if the amount of this credit is higher and
the taxpayer qualifies for both credits.
The amount of credit would be based on the taxpayer's income level and
filing status A qualified taxpayer who is 65 years or older and has a
"single" filing status would be eligible for a base credit, and a
qualified taxpayer who files a joint return with a spouse who is
sixty-five years of age or older, or files as a head of household,
married individual filing a separate return or surviving spouse and
has at least one dependent, would be eligible for a base credit and an
additional amount based on the number of federal exemptions claimed by
such taxpayer The credit will be phased in for taxable years beginning
in 2014, with the initial credit set at one-half of the credit that
would be applicable for taxable years beginning in or after 2015.
Budget Implications:
Enactment of this bill is necessary to implement the 2014-2015
Executive Budget and financial plan. It would reduce All Funds
receipts by a total of $200 million in State Fiscal Year 2015-16 and
$400 million annually thereafter.
Effective Date:
This bill takes effect immediately.
Part M - Modify delivery of the family tax relief credit after Tax
Year 2014
Purpose:
This bill would eliminate the prepayment element of the family tax
relief credit in section 606 (vv) of the tax law for taxable years
beginning on or after January 1, 2015.
Summary of Provisions, Existing Law, Prior Legislative History, and
Statement in Support:
This bill would amend § 606(vv) of the Tax Law to eliminate the
prepayment of the family tax relief credit in taxable years beginning
on or after January 1, 2015 and provide that eligibility for the
credit will be based on the taxpayer's tax return for the current year
Existing law provides that the prepayment would be available in each
year that the credit is allowed (i.e., tax years 2014, 2015 and 2016).
Because of the prepayment, it was necessary to determine eligibility
from a taxpayer's return filed two years prior.
Budget Implications:
Enactment of this bill is necessary to implement the 2014-2015
Executive Budget because it would increase All Funds tax receipts by
$410 million in SFY 2015-16 and reduce All Funds tax receipts by $410
million in SFY 2017-18.
Effective Date:
This bill would take effect immediately and apply to taxable years
beginning on or after January 1, 2015.
Part N - Increase the personal income tax filing threshold to reduce
the number of taxpayers who need to file personal income tax returns
Purpose:
This bill would raise the threshold for filers by eliminating the
personal income tax filing requirement for residents having no tax
liability because the resident's income does not exceed the New York
standard deduction.
Statement in Support, Summary of Provisions, Existing Law, and Prior
Legislative History:
This bill would eliminate the requirement that a resident who has a
modified federal adjusted gross income in excess of $4,000 but less
than the New York standard deduction ($15,650 for married couples)
file a personal income tax return if he or she does not file a federal
personal income tax return. This bill would require only residents who
have modified federal adjusted gross income in excess of the New York
standard deduction to file a personal income tax return.
Raising the filing threshold to the current standard deduction levels
would eliminate filing for approximately 270,000 taxpayers who owe no
New York personal income tax and are not eligible for any refunds
(one-half of whom are senior citizens). The Internal Revenue Service
uses a similar standard.
Budget Implications:
Enactment of this bill would implement a tax simplification
recommendation of the Tax Reform and Fairness Commission and have no
impact on the State's Financial Plan.
Effective Date:
This bill takes effect immediately.
Part O - Extend the Empire State Commercial Production Tax Credit for
Two Years
Purpose:
This bill would extend the Empire State Commercial Production Tax
Credit for two years, until December 31, 2016.
Statement in Support, Summary of Provisions, Existing Law, and Prior
Legislative History:
The Empire State Commercial Production tax credit is available for
taxable years beginning on or after January 1, 2007 and expires on
December 31, 2014. In general, the credit is available to qualifying
taxpayers under Articles 9-A and 22 in an amount equal to 20 percent
of the qualifying production costs incurred in the actual filming or
recording of a qualified commercial in New York that exceed the
average of the previous years' costs for which the credit was applied,
plus 5 percent of costs if costs exceed $500,000 in the calendar year
in the Metropolitan Commuter Transportation District (MCTD) and above
$200,000 in the calendar year outside the MCTD. This bill would
extend the expiration of the tax credit by two years, until December
31, 2016.
Budget Implications:
Enactment of this bill is necessary to implement the 2014-2015
Executive Budget. It would decrease All Funds tax receipts by $7
million in each of SFYs 2016-17 and 2017-18.
Effective Date: This bill takes effect immediately.
Part P - Authorize additional credits of $8 million for the low-income
housing credit for each of the next two fiscal years
Purpose:
This bill would increase the aggregate amount of low income housing
tax credit the Commissioner of Housing and Community Renewal may
allocate from $48 million to $56 million for state fiscal year (SFY)
2014-15 and from $56 million to $64 million for SFY 2015-16.
Summary of Provisions, Existing Law, Prior Legislative History, and
Statement in Support:
Section one of the bill would amend § 22 of the Public Housing Law to
increase the aggregate amount of low income housing tax credit the
Commissioner may allocate from $48 million to $56 million in SFY
2014-15.
Section two of the bill would amend § 22 of the Public Housing Law to
increase the aggregate amount of low income housing tax credit the
Commissioner may allocate from $56 million to $64 million in SFY
2015-16.
Budget Implications:
Enactment of this bill is necessary to implement the 2014-2015
Executive Budget because it would decrease All Funds tax receipts by
$8 million in SFY 2015-16, $16 million annually through SFY 2024-25
and $8 million in SFY 2025-26.
Effective Date: This bill takes effect immediately, however, section
two would take effect on April 1, 2015
Part Q - Extend and Reform the Brownfield Cleanup Program
Purpose:
This bill would extend the brownfield cleanup program and tax credits
for 10 years and further reform the program.
Statement in Support, Summary of Provisions, Existing Law, and Prior
Legislative History:
The bill would:
* Continue the brownfield cleanup program (BCP) and tax credits for 10
years (through December 31, 2025) with needed reforms;
* Separate BCP eligibility from tangible property credit eligibility,
limiting eligibility for tangible property credits to:
a. properties vacant for at least 15 years or vacant and tax
delinquent for 10 years or more;
b. "upside down" properties (where the property value is less than
cleanup costs); and
c. priority economic development projects;
* Provide "bonus" credits for affordable housing, location in an
Environmental Zone, and conforming with a Brownfield Opportunity Area
(BOA) plan;
* Limit eligible site preparation costs to only those needed for
effective cleanup;
* Establish BCP EZ, a fast-track voluntary cleanup option that
provides liability relief without tax credits;
* Terminate sites that have been in the program since before June 2008
that do not complete cleanup by December 31, 2015, and sites in the
program from June 2008 through July 1, 2014 that do not complete
cleanup by December 31, 2017;
* Limit the tangible property tax credit to five consecutive tax years
either after the date of the issuance of the certificate of completion
or the start of the redevelopment of the site; and
* Repeal the insurance remediation tax credit and the real property
tax credit for new sites accepted into the program after July 1, 2014.
The bill would also exempt hazardous waste generated at certain sites
from fees and special assessments, and would authorize DEC to
undertake environmental restoration projects on behalf of a
municipality upon its request.
The BCP tax credits are scheduled to sunset on December 31, 2015. In
the ten years since it was established, the BCP has catalyzed the
cleanup of over 150 contaminated sites statewide, incentivizing
redevelopment. However, it has also resulted in the awarding of over
$800 million in tax credits without regard to the need for financial
assistance Amendments to the BCP program made in 2008 established a
cap on tangible (redevelopment) property tax credits; this bill would
eliminate the tangible tax credits for sites that do not need them to
encourage redevelopment.
The NYS Tax Reform and Fairness Commission recommended that the BCP be
amended to prevent developments that would have gone forward without
tax credits from taking advantage of the program. This bill would
implement the Commission's recommendation. The bill would focus tax
credits on sites and areas of the State, especially upstate, that need
them the most to foster redevelopment. It would also establish a
fast-track option without tax credits that would provide streamlined
state oversight of site cleanup. BCP-EZ, in addition to providing
developers with a fast-track option, would reduce State spending,
while allowing developers to obtain the post-clean-up liability
releases necessary to obtain financing for future site redevelopment.
Budget Implications:
Enactment of this bill is necessary to implement the 2014-2015
Executive Budget because it would maintain program continuity and
provide certainty to program participants Enactment of this bill would
have no impact on tax receipts during the Financial Plan period, but
would provide long term savings.
Effective Date:
This bill takes effect July 1, 2014.
Part R - Establish a 20 percent real property tax credit for
manufacturers; eliminate the net income tax on upstate manufacturers;
reform the investment tax credit; and repeal the financial services
investment tax credit
Purpose: This bill would create a new real property tax credit for
"qualified New York manufacturers", reduce the entire net income tax
rate for qualified upstate New York manufacturers, reform the
investment tax credit (ITC) and repeal the financial services ITC.
Statement in Support, Summary of Provisions, Existing Law, and Prior
Legislative History:
Providing tax relief to manufacturers in this State is necessary to
help existing New York manufacturers survive and attract new
manufacturers to the State. This bill incorporates the recommendations
of the New York State Tax Relief Commission by providing a real
property tax credit to qualified New York manufacturers and reducing
the entire net income tax rate for qualified upstate manufacturers.
The New York State Tax Reform and Fairness Commission recommended ITC
reform in order to more effectively target the State's investment.
The ITC would no longer be available for property used by companies
that do not qualify as manufacturers. In addition, the New York State
Tax Reform and Fairness Commission recommended that the financial
services ITC authorized under Articles 9-A, 22, 32 and 33 of the Tax
Law be eliminated because the credit is complex, frequently subject to
complicated recapture provisions, and provides benefits to an
extremely limited segment of the financial services industry.
Section 1 would add the definition of a "qualified New York
manufacturer" to the Tax Law. It is derived from the definition
currently in place for the reduced Article 9-A tax rates for
manufacturers, which defines a "qualified New York manufacturer" as a
taxpayer that is principally engaged in manufacturing (i.e., more than
50% of its gross receipts derived from the sale of manufactured goods)
and has a minimum amount of property used for manufacturing within the
state or employees engaged in manufacturing within the state.
Section 2 would create a new refundable real property tax credit for
qualified New York manufacturers under Article 9-A (corporate
franchise tax) equal to 20 percent of the real property tax qualified
New York manufacturers paid on property used for manufacturing during
the taxable year.
Sections 3 and 4 would make conforming changes to Article 22 (personal
income tax) for the new refundable real property tax credit for
qualified manufacturers.
Section 5 would reform the ITC under Article 9-A by restricting the
credit to qualified New York manufacturers and qualified New York
agricultural and mining businesses for property used to produce goods
for sale or research and development property. This section also
repeals the financial services ITC.
Section 6 would amend the ITC for taxpayers that lease tangible
personal property to reflect the repeal of the financial services ITC
and the disallowance of the ITC for a qualified film production
facility.
Sections 7 and 8 would exclude air pollution control facilities and
air or water pollution control facilities from receiving the ITC and
would repeal the rehabilitation for historic barns and retail
enterprise credits that are part of the investment tax credit.
Sections 9 through 13 would make conforming changes to Article 22
(personal income tax) for the reform of the ITC and repeal of the
financial services ITC.
Section 14 would repeal the ITC for Article 32 (bank tax) taxpayers.
Section 15 would repeal the ITC for Article 33 (insurance tax)
taxpayers.
Section 16 would reduce the entire net income tax rate from 5.9
percent to zero percent for qualified upstate New York manufacturers
defined as taxpayers that have a zero allocation percentage in the
Metropolitan Commuter Transportation District for purposes of the MTA
business tax surcharge.
Section 17 would amend the capital base definition under Article 9-A
to include the definition of a qualified New York manufacturer as
defined in Section 1 of the bill.
Section 18 would amend the alternative minimum tax definition under
Article 9-A to include the definition of a qualified New York
manufacturer as defined in Section 1 of the bill.
Section 19 would amend the fixed dollar minimum tax definition under
Article 9-A to include the definition of a qualified New York
manufacturer as defined in Section 1 of the bill.
Section 20 states that for the purposes of determining whether a
taxpayer is an eligible qualified New York manufacturer and able to
receive the associated tax benefits available for tax years 2012
through 2014, the taxpayer shall use the guidelines and criteria that
were in effect for December 31, 2013.
Section 21 would remove the Excelsior ITC component for taxpayers who
file under Article 32 or Article 33.
Section 22 contains a severability clause.
Section 23 provides for an effective date of January 1, 2014.
Budget Implications: Enactment of this bill is necessary to implement
the 2014-2015 Executive Budget. In particular:
* The real property tax credit for manufacturers would decrease All
Funds tax receipts by $136 million in each of SFYs 2015-16 through
2018-19.
* The reform of the ITC would increase All Funds tax receipts by $65
million in each of SFYs 2014-15 through 2018-19.
* The repeal of the financial services ITC would increase All Funds
tax receipts by $30 million in each of SFYs 2014-15 through 2018-19
* The reduction of the entire net income rate for qualified upstate
New York manufacturers would decrease All Funds tax receipts by $24
million in SFYs 201415 through 2015-16 and $25 million in SFYs 2016-17
through 2018-19.
Effective Date:
This bill takes effect immediately and would apply to taxable years
beginning on or after January 1, 2014.
Part S - Repeal the franchise tax on agriculture cooperatives
Purpose: This bill would repeal the State's Tax Law § 185 franchise
tax on farmers', fruit growers', and other like agricultural
corporations organized and operated on a co-operative basis.
Statement in Support, Summary of Provisions, Existing Law, and Prior
Legislative History:
The bill would repeal the franchise tax on agriculture cooperatives
and exempt those corporations from tax The bill would also make
conforming changes to the Tax Law and various other laws. Only 45
taxpayers pay this tax, and the median tax is $160 with one-third of
taxpayers only paying $10. Since SFY 2006-07, in only one year (SFY
2011-12) were receipts greater than the amount of refunds paid out.
Budget Implications:
Enactment of this bill is necessary to implement the 2014-2015
Executive Budget, because it would implement a tax simplification
recommendation of the Tax Reform and Fairness Commission and has no
impact on the State's Financial Plan.
Effective Date: The bill would take effect immediately and apply to
taxable years beginning on or after January 1, 2015.
Part T - Provide a refundable credit for the excise tax on
telecommunication services paid by START-UP NY companies.
Purpose:
This bill would provide a refundable credit for the excise tax on
telecommunication services paid by START-UP NY companies.
Statement in Support, Summary of Provisions, Existing Law, and Prior
Legislative History:
Section 186-e of the Tax Law imposes an excise tax on
telecommunication services that is customarily passed through by the
telecommunications provider to its customers. The bill would provide
that START-UP NY companies would be allowed a refundable credit equal
to the section 186-e tax that is passed through to such businesses.
Budget Implications:
Enactment of this bill is necessary to implement the 2014-2015
Executive Budget, because it would eliminate an inconsistency in the
current START-UP NY statute The cost of this bill is included in the
Financial Plan as part of the cost of the START-UP NY program.
Effective Date: This bill takes effect immediately and applies to
taxable years beginning on or after January 1, 2014.
Part U - Enhance the Youth Works Tax Credit
Purpose:
This bill would amend the Tax Law to allow employers to claim the New
York State Youth Works credit for certain employees who work ten hours
per week if the employees are enrolled in high school full time, and
to provide an additional tax credit to employers that employ such
youth for one additional year
Statement in Support, Summary of Provisions, Existing Law, and Prior
Legislative History:
Currently, employers can claim the New York State Youth Works credit
only for employees employed either full time or part-time (who worked
at least twenty hours per week) This bill amends the Tax Law to
conform to amendments to the Labor Law that were added by Chapter 536
of the Laws of 2013 which expanded coverage of the credit to include
employees who work at least ten hours per week while enrolled full
time in high school, for purposes of calculating the credit.
Additionally this bill would provide an additional $1,000 tax credit
for employers that retain youth in full-time status for one additional
year and an additional $500 for employers that retain youth in a
part-time status for one additional year.
Finally, this bill increases the allocation amounts under programs two
through five from $6 million to $10 million.
Budget Implications:
Enactment of this bill is necessary to implement the 2013-14 Executive
Budget because it would decrease All Funds tax receipts by $4 million
in each of SFYs 2015-16 through 2018-19.
Effective Date: This bill takes effect immediately and applies to
taxable years beginning on or after January 1, 2014.
Part V - Extend the alternative fuels tax exemptions for two years
Purpose:
This bill would extend the sunset from September 1, 2014 to September
1, 2016 for the tax exemptions for alternative fuels, including E85,
CNG, hydrogen, and B20.
Statement in Support, Summary of Provisions, Existing Law and Prior
Legislative History:
Extending the exemptions for alternative fuels would continue to
provide an incentive for the use of renewable fuels and is part of a
comprehensive strategy to reduce dependence on foreign oil and to
increase the use of clean energy fuels.
This bill would extend the sunset for the exemptions in the Tax Law
for alternative fuels from September 1, 2014 to September 1, 2016.
Unless this sunset is extended, the Tax Law will no longer allow full
exemptions for E85, CNG, and hydrogen, and partial exemption for B20
from the motor fuel taxes (Article 12-A), the petroleum business taxes
(Article 13-A), fuel use taxes (Article 21-A) and State and local
sales and compensating use taxes (Articles 28 and 29).
Budget Implications:
Enactment of this bill is necessary to implement the 2014-2015
Executive Budget because it would reduce All Funds sales and use,
petroleum business, and motor fuel taxes by a total of $8 million in
SFY 2014-15, $16 million in SFY 2015-16 and $8 million in SFY 2016-17.
Effective Date:
This bill takes effect immediately.
Part W - Simplify the distribution of motor vehicle fee receipts
Purpose: This bill would replace all current Department of Motor
Vehicles General Fund (MVGF) transfers with a simplified structure.
Summary of Provisions, Existing Law, Prior Legislative History, and
Statement in Support:
Section one of the bill would amend § 15 of Part V of chapter 61 of
the laws of 2005 by ending the current MVGF structure. A GF transfer
is also created that in each quarter accomplishes the following:
* The Dedicated Highway Bridge Trust Fund (DHBTF) will receive
$16,498,255 (annual amount is $65,993,020);
* The Mass Transportation Trust Fund (MTTF) will receive $15,665,245
(annual amount is $62,660,980).
Section two of the bill would amend § 503 of the Vehicle and Traffic
Law to end the current transfer of the first $40.7 million of the
Driver Responsibility Act (DRA) receipts to the General Fund.
Instead, all revenues from the DRA will be directed to the DHBTF. The
DHBTF transfer in section one was reduced to reflect this additional
amount.
Current law requires an annual transfer of $169,354,000 from the MVGF
to the Dedicated Funds ($106,693,020 to the DHBTF and $62,660,980 to
the MTTF). This transfer occurs on a monthly basis from non-dedicated
motor vehicle receipts until the transfer amount has been met.
Current law also requires that the first $40.7 million of the Driver
Responsibility Act receipts collected each year be directed to the
MVGF
This bill would replace the identification of specific motor vehicle
fee revenue streams as they flow into the GF with DRA revenue going
directly onto a dedicated fund and a simple GF transfer to the correct
dedicated funds.
Budget Implications:
This bill is revenue neutral and there is no impact on overall revenue
for the DHBTF, MTTF or General Fund.
Effective Date: This bill takes effect immediately.
Part X - Comprehensive estate tax reform
Purpose:
This bill would amend the estate tax to: (1) increase the exclusion
threshold to the amount of the current federal unified credit over 5
years; (2) decrease the top estate tax rate, and (3) require the
add-back of certain gifts and incorporate applicable Internal Revenue
Code (IRC) provisions. The bill would also repeal the generation
skipping transfer (GST) tax in Tax Law Article 26-B.
Statement in Support, Summary of Provisions, Existing Law and Prior
Legislative History:
New York's estate tax currently conforms to the IRC with all
amendments through July 1, 1998, except that the exclusion amount is
fixed at $1 million The estate tax is commonly known as a "pick-up"
tax, because the tax is equal to the federal credit for state estate
taxes, as it existed on July 22, 1998.
This tax is woefully out of date. It is tied to a federal law that no
longer exists in practical effect, because the IRC has undergone
significant amendments over the last 15 years that have not been
adopted by New York For example, the credit for state estate taxes -
the base of New York's estate tax - no longer exists in federal law.
Moreover, when the current State exclusion amount of $1 million was
set, it was not indexed to inflation or tied to the periodic increases
in the federal estate tax exclusion amount The federal estate tax
exclusion amount has been raised to $5.25 million and indexed to
inflation, leaving New York significantly out of sync. New York is one
of only 15 states with an estate tax and only two states currently
have a lower exemption.
Consistent with Governor Cuomo's Tax Relief Commission Report, this
bill would increase the New York exclusion amount to the federal
amount of $5.25 million over four years, with the exclusion indexed to
inflation thereafter. Many estates of middle class individuals
(including small business owners and family farmers) will no longer be
subject to the tax as a result of increasing the exclusion amount. The
bill would also phase down the top tax rate from 16 percent to 10
percent by State Fiscal Year 201718. This will address an incentive
for wealthy New Yorkers to leave the State. It would also require
certain gifts made after April 1, 2014 to be included in a decedent's
New York gross estate, closing a loophole by preventing deathbed gifts
from escaping the estate tax.
The bill would also repeal the GST tax in Article 26-B of the Tax Law,
as recommended by Governor Cuomo's Tax Reform and Fairness Commission
Currently, federal law imposes estate, gift and GST taxes as part of a
comprehensive scheme for the taxation of wealth transfers. Federal law
also provides for a unified credit that is applied to each of these
taxes so that all such wealth transfers receive equivalent tax
treatment. New York's gift tax was repealed, effective January 1,
2000. The current GST is based on a federal credit for state GST taxes
that expired in 2004 Moreover, that federal credit, and therefore, New
York's GST tax, applied only to certain specific types of
generation-skipping transfers (i.e., distributions and terminations of
trusts that occurred at the same time and as the result of the death
of an individual) Because the federal GST tax already provides an
effective disincentive to wealth transfers to grandchildren and later
generations, New York's tax is largely unnecessary to prevent estate
tax avoidance.
The current GST tax affects a few dozen taxpayers each year, yields
minimal annual revenue, and frequently causes taxpayer confusion.
Repealing this tax would result in minimal revenue loss and provide
taxpayer relief.
A significant portion of the bill creates an appendix to the Tax Law
of all of the IRC provisions, as amended through January 1, 2014,
which are relevant to the estate tax. The current appendix, which was
enacted by § 2 of Chapter 1013 of the laws of 1962, and periodically
amended, is based on the 1998 version of the IRC. This bill would
repeal the outdated appendix in Chapter 1013, and replace it with a
new appendix of current IRC provisions located in the consolidated
law.
Budget Implications:
Enactment of this bill is necessary to implement the 2014-2015
Executive Budget. It would reduce revenues by $33 million in SFY
2014-15, $175 million in SFY 2015-16, $371 million in SFY 2016-17,
$612 million in SFY 2017-18 and $757 million in SFY 2018-19.
Effective Date:
This bill would take effect on April 1, 2014 and would apply to
estates of decedents dying on or after that date.
Part Y - Repeal the Boxing and Wrestling Exhibitions Tax
Purpose:
This bill would repeal Article 19 of the Tax Law, which imposes the
State's Boxing and Wrestling Exhibitions Tax
Statement in Support, Summary of Provisions, Existing Law, and Prior
Legislative History:
This bill would repeal Article 19 of the Tax Law, which imposes the
State's Boxing and Wrestling Exhibitions Tax on a promoter's gross
receipts from ticket sales to attend the event and on the promoter's
sale of broadcast rights to the event, at the rate of three percent.
The bill would also repeal section 1820 of the Tax Law, which imposes
misdemeanor penalties for willful failure to comply with provisions of
Article 19.
The effect of repealing the Article 19 tax is that State and local
sales taxes on admission charges would arise on the charge for tickets
sold to boxing and wrestling events held in this State, regardless of
where the ticket is sold. Tax Law § 1105(f)(1) imposes sales tax on
admission charges including admissions to sporting events, but
excludes from sales tax admission charges to boxing, sparring, or
wrestling matches or exhibitions which are taxed by another law of the
State. By repealing the Article 19 tax, the State and local sales tax
on admission charges to such events will automatically apply, because
the exclusion condition is no longer met.
The replacement of the boxing and wrestling tax with the sales tax on
admissions to boxing and wrestling bouts was recommended by the New
York State Tax Reform and Fairness Commission to create more
consistent tax treatment between boxing and wrestling events and other
sporting events.
The bill would also make conforming amendments to Chapter 912 of the
Laws of 1920, which authorized the State Athletic Commission to
administer boxing and wrestling events.
Budget Implications:
Enactment of this bill is necessary to implement the 2014-2015
Executive Budget because it would implement a tax simplification
recommendation of the Tax Reform and Fairness Commission and has no
impact on the State's Financial Plan.
Effective Date:
The bill would take effect September 1, 2014. The bill would apply to
sales of tickets to events occurring on or after the effective date,
whether or not the admission was paid prior to that date, unless the
tickets were actually sold and delivered to the purchaser prior to
that date.
Part Z - Extend Monticello Raceway Video Lottery Terminal rates for
one year
Purpose:
This bill would extend for one year the current distribution of video
lottery gaming revenue at Monticello Raceway (Monticello).
Statement in Support, Summary of Provisions, Existing Law, and Prior
Legislative History:
This bill would extend for one year the current commission rate paid
to Monticello as a video lottery agent. In 2008, Monticello was given
a higher commission rate for a five-year period in exchange for opting
out of participation in a capital award program. Thus, the five-year
rate sunset was applied to coincide with the five-year period other
facilities were provided for approval of capital expenditures eligible
for reimbursement through the program. The capital award program was
extended for a sixth year (to 2014) by chapter 454 of the Laws of 2012
and is proposed to be extended to 2015 by the 2014-2015 Executive
Budget. Since the expiration of Monticello's rate would result in loss
of the enhanced commission, but would not provide for participation in
the capital award program, this bill would extend Monticello's rate
for an additional year to maintain the original framework of
Monticello's rate structure and keep its duration consistent with the
capital award program.
Section 1 of the bill amends Section 1612(b)(1)(ii)(F) of the Tax Law
to extend from six to seven years the forty-one percent vendor fee
paid to a vendor track located in Sullivan County and within sixty
miles from any gaming facility in a contiguous state.
Section 2 of the bill provides for an immediate effective date that
shall be deemed in effect on and after April 1, 2014.
Budget Implications: Enactment of this bill is necessary to implement
the 2013-14 Executive Budget. It would decrease All Funds revenue by
$3 million in SFY 2014-15.
Effective Date: This bill takes effect after April 1, 2014.
Part AA - Extend certain tax rates and certain simulcasting provisions
for one year
Purpose:
This bill would extend for one additional year various provisions of
the Racing, PariMutuel Wagering and Breeding (Racing) Law which expire
during the 2014-15 fiscal year.
Summary of Provisions, Existing Law, Prior Legislative History, and
Statement in Support:
Section 1 would amend Racing Law § 1003(a) to extend the June 30, 2014
expiration date for in-home simulcasting.
Section 2 would amend Racing Law § 1007(3)(d) to extend the current
percentage of total pools allocated to purses that a track located in
Westchester County receives from a franchised corporation, which
currently are scheduled to expire on June 30, 2014.
Section 3 would amend the opening paragraph of Racing Law § 1014, to
continue the provisions allowing simulcasting of out-of-state
thoroughbred races on any day the Saratoga thoroughbred track is
operating, which currently are scheduled to expire on June 30, 2014.
Section 4 would amend Racing Law § 1015(1) to extend the provisions
governing the simulcasting of races conducted at out-of-state harness
tracks, which currently are scheduled to expire on June 30, 2014.
Section 5 would amend the opening paragraph of Racing Law § 1016(1) to
continue the provisions governing the simulcasting of out-of-state
thoroughbred races on any day the Saratoga thoroughbred track is
closed, which currently are scheduled to expire on June 30, 2014.
Section 6 would amend the opening paragraph of section 1018 of the
racing, pari-mutuel wagering and breeding law to extend the current
distribution of revenue from out-of-state simulcasting during the
Saratoga meet, which expired on September 8, 2013.
Section 7 would amend § 32 of chapter 281 of the Laws of 1994 to
extend the current amount of off-track betting wagers on New York
Racing Association, Inc. (NYRA) pools dedicated to purse enhancement,
which currently expire on June 30, 2014.
Section 8 would amend § 54 of chapter 346 of the Laws of 1990 to
continue binding arbitration for disagreements. These provisions
currently expire on July 1, 2014.
Section 9 would amend Racing Law § 238(1)(a) to continue the current
distribution of revenue from on-track wagering on NYRA races, which
currently is scheduled to expire on December 31, 2014.
Extending these provisions would maintain the pari-mutuel betting and
simulcasting structure that is currently in place in New York State.
The provisions extended by sections one through six of this bill were
first enacted in 1994 and section seven was enacted in 1990. These
provisions were extended numerous times since their original
enactment, and most recently in 2013.
Budget Implications:
Enactment of this bill is necessary to implement the 2014-2015
Executive Budget because it maintains the current pari-mutuel betting
structure in New York State.
Effective Date:
This bill takes effect immediately.
Part BB - Extend the Video Lottery Gaming (VLG) vendor's capital
awards program for one year
Purpose:
This bill would extend for one year the deadline to receive approval
and to complete capital projects that are reimbursed through the Video
Lottery Gaming (VLG) vendor's capital award program.
Summary of Provisions, Existing Law, Prior Legislative History, and
Statement in Support:
This bill would extend by one year, until April 1, 2015, the deadline
to receive approval for capital projects to be reimbursed through the
VLG vendor's capital award program. The bill also extends by one year,
until April 1, 2017, the deadline to complete these projects. For
certain vendor tracks located west of State Route 14, these deadlines
are extended to April 1, 2019 for approvals and to April 1, 2021 for
completion.
Budget Implications:
Enactment of this bill is necessary to implement the 2014-2015
Executive Budget because it maintains the current VLG revenue stream.
Effective Date: This bill takes effect immediately.
Part CC - Repeal Article 12 of the Tax Law
Purpose: This bill would repeal Article 12 of the Tax Law and make
conforming changes to other provisions of law that reference it.
Statement in Support, Summary of Provisions, Existing Law, and Prior
Legislative History:
Article 12 of the Tax Law imposes a tax on all sales and deliveries or
transfers of shares or certificates of stock With the creation of the
Municipal Assistance Corporation (MAC) to provide financial assistance
to New York City, these revenues were used as additional security for
MAC bonds In 1981, a 100% rebate of the tax was instituted, but the
tax itself was kept in place to continue backing the MAC bonds. The
MAC bonds were retired in 2008, which means the backing of these
revenues is no longer needed for this purpose.
This bill would repeal Article 12 and also would repeal related funds
(State Finance Law sections 92-B and 92-I, which is the Incentive
Fund). The remaining sections of the bill make conforming changes to
the Tax Law, Banking Law, Public Authorities Law, State Finance Law,
and the Administrative Code of the City of New York.
This act would take effect June 1, 2014, however, the repeal of
Incentive Fund would not take effect until two years after the
effective date of this act, and a taxpayer's right to claim a rebate
would be preserved for those two years. This would allow taxpayers,
who may have paid the tax before its repeal, the full statutory two
years currently. allowed to file for a rebate of the tax paid.
Budget Implications:
Enactment of this bill is necessary to implement the 2014-2015
Executive Budget because it would implement a tax simplification
recommendation of the Tax Reform and Fairness Commission and has no
impact on the State's Financial Plan.
Effective Date:
The bill would take effect on June 1, 2014. However, the repeal of the
Incentive Fund in section 10 of the bill would not take effect until
two years from the date this act takes effect.
Part DD - Align mobility and personal income tax filings for the
self-employed
Purpose:
This bill would allow self-employed individuals who are subject to the
Metropolitan Commuter Transportation Mobility Tax ("MCTMT") to file
their MCTMT returns at the same time as their personal income tax
returns.
Statement in Support, Summary of Provisions, Existing Law, and Prior
Legislative History:
This is a new bill recommended by the New York State Tax Reform and
Fairness Commission. It would change the due dates for filing returns
and making estimated tax payments for self-employed individuals
subject to the MCTMT. The bill would uncouple the due date for
estimated MCTMT payments for self-employed individuals from the date
for estimated MCTMT payments for employers (i e., April 30, July 31,
October 31, January 31). Instead, such payments would be due on the
same date as quarterly estimated personal income tax payments (i.e.,
April 15, June 15, September 15, January 15). Taxpayers would be
allowed to file combined returns for their personal income tax and
MCTMT, and the Tax Department would be authorized to pursue joint
assessments and actions for the two taxes. The bill also would change
the MCTMT return due date from April 30 to April 15, to conform to the
personal income tax due date.
Allowing self-employed individuals to file their MCTMT returns in
conjunction with their personal income tax returns, and to make their
quarterly estimated MCTMT payments with their quarterly estimated
personal income tax payments, would simplify tax compliance for these
taxpayers.
Budget Implications:
Enactment of this bill is necessary to implement the 2014-2015
Executive Budget. It would implement a tax simplification
recommendation of the Tax Reform and Fairness Commission and has no
impact on the State's Financial Plan.
Effective Date:
This bill takes effect immediately and applies to taxable years
beginning January 1, 2015.
Part EE - Make technical amendments to the commercial gaming law
Purpose: This bill would allow for the distribution of moneys in the
Commercial Gaming Revenue Fund for support of education to be made in
the year received. It also makes technical changes to the Upstate New
York Gaming and Economic Development Act of 2013.
Statement in Support, Summary of Provisions, Existing Law, and Prior
Legislative History:
This bill would allow revenue from commercial gaming dedicated to
support education to be distributed following monthly transfers to
cover a shortfall, if any, in the Video Lottery Education Fund. Under
current law, commercial gaming revenue dedicated to support education
may not be distributed until the fiscal year following receipt of the
revenue.
Section one of the bill would amend State Finance Law § 97-nnnn(4) to
require transfers to the Video Lottery Education Fund to be made on a
monthly basis, and allows revenue to be distributed to support
education in the year revenue is received.
Section two of the bill would amend State Finance Law § 97-nnnn(5) to
make technical corrections to law references.
Section three of the bill would amend section 52 of Chapter 174 of the
Laws of 2013 to make technical corrections to clarify the effective
dates of certain provisions of Upstate New York Gaming and Economic
Development Act of 2013.
Section four of the bill would amend State Finance Law § 99-h(3-a) to
clarify that payments of regional county aid equal 10 percent of
exclusivity payments received by the State.
Section five of the bill would amend Tax Law § 1617-a(g) to extend the
term of video lottery gaming licenses issued before July 30, 2013
until the applicant's next birthday following June 30, 2014.
Section six of the bill provides the effective dates.
Budget Implications:
Enactment of this bill is necessary to implement the 2014-2015
Executive Budget, because it would allow revenue from commercial
gaming dedicated to support education to be used in the year received.
Effective Date:
This bill would take effect immediately, provided, however, that
section one would take effect on April 1, 2015 and section three would
be deemed to have taken effect on the same date as Chapter 174 of the
Laws of 2014.
Part FF - Provide a two-year property tax freeze through a refundable
personal income tax credit
Purpose:
This bill would create a refundable personal income tax credit for
homeowners which would effectively hold property taxes on their
primary residences constant for two years.
Statement in Support, Summary of Provisions, Existing Law, and Prior
Legislative History:
New York homeowners are subject to some of the highest property tax
bills in the nation, whether measured in absolute terms or as a
percentage of income or home value. Property taxes have seriously
burdened New York's working families and senior citizens and hindered
job growth. While progress has been made and should continue under the
property tax cap legislation, there is a need to further reduce the
property tax burden.
This bill effectively freezes property taxes on the primary residences
of homeowners with annual incomes at or less than $500,000 in local
governments and school districts that stay within the cap for the next
two years. This will be effective for school districts starting with
the 2014-15 school year and for local governments in fiscal years
beginning in 2015.
In order for homeowners in their jurisdiction to receive the tax
credit in the second year, school districts and local governments must
continue to stay within the tax cap and must work together to develop
and implement plans for sharing or consolidating services that, when
implemented, will achieve real savings for taxpayers.
Budget Implications:
Enactment of this bill is necessary to implement the 2014-2015
Executive Budget because it would reduce All Funds receipts by a total
of $400 million in SFY 2014-15, $976 million in SFY 2015-16, and $475
million in SFY 2016-17.
Effective Date: This bill takes effect immediately and applies to
taxable years beginning on or after January 1, 2014.
2013-S6359 - Bill Text download pdf
S T A T E O F N E W Y O R K
________________________________________________________________________
S. 6359 A. 8559
S E N A T E - A S S E M B L Y
January 21, 2014
___________
IN SENATE -- A BUDGET BILL, submitted by the Governor pursuant to arti-
cle seven of the Constitution -- read twice and ordered printed, and
when printed to be committed to the Committee on Finance
IN ASSEMBLY -- A BUDGET BILL, submitted by the Governor pursuant to
article seven of the Constitution -- read once and referred to the
Committee on Ways and Means
AN ACT to amend the tax law, the general municipal law, the urban devel-
opment corporation act, the business corporation law, the general
associations law, and the administrative code of the city of New York,
in relation to reforming taxation of business corporations; and to
repeal various provisions of the tax law relating thereto (Part A); to
amend the real property tax law, in relation to the STAR registration
program (Part B); to amend chapter 540 of the laws of 1992, amending
the real property tax law relating to oil and gas charges, in relation
to the effective date of such chapter (Part C); to amend the racing,
pari-mutuel wagering and breeding law, in relation to increasing
racing regulatory fees (Part D); to amend the tax law, in relation to
modifying the signature requirement on e-filed returns prepared by tax
professionals (Part E); to amend the real property tax law, in
relation to cost of living adjustments for Enhanced STAR (Part F); to
amend part I of chapter 58 of the laws of 2006, relating to providing
an enhanced earned income tax credit, in relation to the effectiveness
thereof (Part G); to amend the general obligations law and the tax
law, in relation to authorizing electronic tax clearances for profes-
sional and business licenses (Part H); to amend the tax law and the
administrative code of the city of New York, in relation to taxing
residents who are grantors of exempt resident trusts that qualify as
non-grantor incomplete gift trusts on the income from such trusts and
taxing residents who are beneficiaries of all other exempt resident
trusts or nonresident trusts on the distributions of accumulated
income that they receive from such trusts (Part I); to amend the tax
law and the administrative code of the city of New York, in relation
to eliminating the personal income tax add-on minimum tax; and to
repeal certain provisions of such laws relating thereto (Part J); to
amend the tax law, in relation to adding an enhanced real property tax
circuit breaker; and to repeal paragraph 14 of subsection (e) of
EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD12674-01-4
S. 6359 2 A. 8559
section 606 of the tax law, relating to certain reports (Part K); to
amend the tax law, in relation to providing a credit for renters
against the personal income tax (Part L); to amend the tax law, in
relation to the prepayment element of the family tax relief credit
(Part M); to amend the tax law, in relation to eliminating the
personal income tax filing requirement for residents having no liabil-
ity because income does not exceed the New York standard deduction if
they do not file a federal income tax return (Part N); to amend the
tax law, in relation to extending the empire state commercial
production tax credit (Part O); to amend the public housing law, in
relation to extending the credit against income tax for persons or
entities investing in low-income housing (Part P); to amend the envi-
ronmental conservation law, the tax law and the general municipal law,
in relation to eligibility for participation in the brownfield cleanup
program, and assignment of the brownfield redevelopment tax credits;
to amend part H of chapter 1 of the laws of 2003, amending the tax law
relating to brownfield redevelopment tax credits, remediated brown-
field credit for real property taxes for qualified sites and environ-
mental remediation insurance credits, in relation to tax credits for
certain sites; to amend the environmental conservation law, in
relation to hazardous waste generator fees and taxes; to amend the
environmental conservation law, the public authorities law and the
state finance law, in relation to the environmental restoration
program; and to repeal certain provisions of the environmental conser-
vation law and the tax law relating thereto (Part Q); to amend the tax
law, in relation to reforming the investment tax credit, reducing the
tax rate for upstate manufacturers and providing a tax credit for real
property taxes to New York manufacturers; to amend the economic devel-
opment law, in relation to the excelsior investment tax credit; and to
repeal certain provisions of the tax law relating to the financial
services investment tax credit (Part R); to amend the economic devel-
opment law, the tax law, the transportation law, the administrative
code of the city of New York and the New York state urban development
corporation act, in relation to repealing the franchise tax on farm-
ers', fruit growers', and other like agricultural corporations organ-
ized and operated on a co-operative basis; and to repeal section 185
of the tax law relating to franchise tax on farmers', fruit growers',
and other like agricultural corporations organized and operated on a
co-operative basis; to repeal sections 187-j, 187-k, 187-l, 187-m,
187-q, 187-r and 187-s of the tax law relating to certain tax credits;
to repeal paragraph 1 of subdivision (h) of section 15, paragraph 1 of
subdivision (g) of section 31, and certain other provisions of the tax
law, in relation to making conforming changes (Part S); to amend the
tax law, in relation to providing a credit for excise tax on telecom-
munication services for businesses located in tax-free NY areas (Part
T); to amend the tax law, in relation to reducing the number of hours
of part-time work needed by employees for employer qualification for
the New York youth works tax credit; and to amend the labor law, in
relation to the New York youth works tax credit (Part U); to amend
chapter 109 of the laws of 2006 amending the tax law and other laws
relating to providing exemptions, reimbursements and credits from
various taxes for certain alternative fuels, in relation to extending
the alternative fuels tax exemptions for two years (Part V); to amend
chapter 63 of the laws of 2000, amending the tax law and other laws
relating to modifying the distribution of funds from the motor vehicle
fuel excise tax and the vehicle and traffic law, in relation to
S. 6359 3 A. 8559
simplifying the methodology for distribution of motor vehicle receipts
(Part W); to amend the tax law, in relation to the estate tax; to
repeal section 2 of chapter 1013 of the laws of 1962, amending the tax
law relating to imposing a tax on the transfer of estates of decedents
dying on or after April first, nineteen hundred sixty-three, relating
to an appendix of applicable internal revenue code provisions, and to
repeal article 26-B of the tax law, relating to the generation skip-
ping transfer tax (Part X); to amend the tax law and chapter 912 of
the laws of 1920 relating to the regulation of boxing, sparring and
wrestling matches, in relation to making technical corrections there-
to; to repeal article 19 of the tax law relating to boxing and wrestl-
ing exhibitions tax; and to repeal section 1820 of the tax law relat-
ing to establishing misdemeanors for certain violations of article 19
of such law (Part Y); to amend the tax law, in relation to vendor fees
paid to vendor tracks (Part Z); to amend the racing, pari-mutuel
wagering and breeding law, in relation to licenses for simulcast
facilities, sums relating to track simulcast, simulcast of out-of-
state thoroughbred races, simulcasting of races run by out-of-state
harness tracks and distributions of wagers; to amend chapter 281 of
the laws of 1994 amending the racing, pari-mutuel wagering and breed-
ing law and other laws relating to simulcasting and chapter 346 of the
laws of 1990 amending the racing, pari-mutuel wagering and breeding
law and other laws relating to simulcasting and the imposition of
certain taxes, in relation to extending certain provisions thereof;
and to amend the racing, pari-mutuel wagering and breeding law, in
relation to extending certain provisions thereof (Part AA); to amend
the tax law, in relation to capital awards to vendor tracks (Part BB);
to amend the tax law, the banking law, the public authorities law, and
the administrative code of the city of New York, in relation to the
stock transfer tax, and to repeal certain provisions of the tax law,
the state finance law and the administrative code of the city of New
York relating thereto (Part CC); to amend the tax law, in relation to
conforming the due dates for the metropolitan commuter transportation
mobility tax for taxpayers with income from self-employment with the
due dates for the personal income tax (Part DD); to amend the state
finance law, the upstate New York gaming economic development act of
2013 and the tax law, in relation to moneys appropriated or trans-
ferred from the commercial gaming revenue fund (Part EE); and to amend
the tax law, the education law, the general municipal law, and the
real property tax law, in relation to a real property tax freeze (Part
FF)
THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:
Section 1. This act enacts into law major components of legislation
which are necessary to implement the state fiscal plan for the 2014-2015
state fiscal year. Each component is wholly contained within a Part
identified as Parts A through FF. The effective date for each particular
provision contained within such Part is set forth in the last section of
such Part. Any provision in any section contained within a Part, includ-
ing the effective date of the Part, which makes a reference to a section
"of this act", when used in connection with that particular component,
shall be deemed to mean and refer to the corresponding section of the
S. 6359 4 A. 8559
Part in which it is found. Section three of this act sets forth the
general effective date of this act.
PART A
Section 1. Article 32 of the tax law is REPEALED.
S 2. Section 180 of the tax law is REPEALED.
S 3. Section 181 of the tax law is REPEALED.
S 4. Section 208 of the tax law, as added by chapter 415 of the laws
of 1944, subdivision 1 as amended by chapter 576 of the laws of 1994,
subdivision 1-A as amended by chapter 166 of the laws of 1991, subdivi-
sion 1-B as added by section 45 of part A and paragraph (k) of subdivi-
sion 9 as added by section 46 of part A of chapter 389 of the laws of
1997, subdivision 3, the opening paragraph, subparagraphs 6 and 11 of
paragraph (b), and the opening paragraph of paragraph (g) of subdivision
9 as amended and subdivision 8-B and subparagraph 3-a of paragraph (b)
of subdivision 9 as added by chapter 817 of the laws of 1987, subdivi-
sion 4 as amended by section 1, subdivision 6 as amended by section 2
and subparagraph 2 of paragraph (a) of subdivision 9 as amended by
section 7 of part M of chapter 407 of the laws of 1999, subdivisions 5
and 7, paragraph (a) of subdivision 8-B, subparagraph 10 of paragraph
(b) and paragraph (j) of subdivision 9 as amended, paragraph (d) of
subdivision 8-B and paragraph (c-1) of subdivision 9 as added and para-
graphs (e) and (f) of subdivision 8-B as relettered by chapter 170 of
the laws of 1994, subdivisions 8 and 10 as amended by chapter 133 of the
laws of 1945, subdivision 8-A as added and subparagraph 1 of paragraph
(a) of subdivision 9 as amended by chapter 778 of the laws of 1972,
paragraph (b) of subdivision 8-A and paragraph (i) of subdivision 9 as
amended by chapter 779 of the laws of 1972, subdivision 9 as amended by
chapter 713 of the laws of 1961, paragraph (a) of subdivision 9 as
amended by chapter 203 of the laws of 1962, subparagraphs 5, 9 and 10 of
paragraph (a) and subparagraphs 8 and 9 of paragraph (b) of subdivision
9 as amended by chapter 61 of the laws of 1989 and paragraph (f) of
subdivision 9 as separately amended by sections 278 and 347 of chapter
61 of the laws of 1989, clause (i) of subparagraph 5 of paragraph (a) of
subdivision 9 as amended by section 2 and subparagraph 20 of paragraph
(b) of subdivision 9 as added by section 3 of part C of chapter 25 of
the laws of 2009, subparagraph 6 of paragraph (a) of subdivision 9 as
added by chapter 895 of the laws of 1975 and as renumbered by chapter
613 of the laws of 1976, subparagraph 7 of paragraph (a) of subdivision
9 as added by chapter 33 of the laws of 1978, subparagraph 8 of para-
graph (a) and subparagraph 7 of paragraph (b) of subdivision 9 as
amended by chapter 639 of the laws of 1986, subparagraph 11 of paragraph
(a) of subdivision 9 as added by chapter 15 of the laws of 1983, subpar-
agraph 12 of paragraph (a), subparagraph 4-a of paragraph (b) and
subparagraph 2 of paragraph (h) of subdivision 9 as amended and subpara-
graph 13 of paragraph (a) of subdivision 9 as added by chapter 760 of
the laws of 1992, subparagraph 14 of paragraph (a) of subdivision 9 as
added by section 101 and paragraphs (l) and (m) of subdivision 9 as
added by section 102 of part A of chapter 56 of the laws of 1998,
subparagraph 15 of paragraph (a) of subdivision 9 as amended by section
1 of part ZZ of chapter 63 of the laws of 2003, subparagraph 16 of para-
graph (a) of subdivision 9 as added by section 1 of part K3, subpara-
graph 16 of paragraph (b) of subdivision 9 as added by section 2 of part
K3, subparagraph 17 of paragraph (b) of subdivision 9 as added by
section 2 of part O3, and paragraphs (o), (p) and (q) of subdivision 9
S. 6359 5 A. 8559
as added by section 3 of part O3 of chapter 62 of the laws of 2003,
subparagraph 18 of paragraph (a) of subdivision 9 as added by section 3
of part C and paragraph (o) of subdivision 9 as amended by section 2 of
part E of chapter 59 of the laws of 2013, subparagraph 3 of paragraph
(b) of subdivision 9 as amended by chapter 895 of the laws of 1975,
subparagraph 4 of paragraph (b) and subparagraph 4 of paragraph (f) of
subdivision 9 as amended by chapter 190 of the laws of 1990, subpara-
graph 15 of paragraph (b) of subdivision 9 as added by chapter 309 of
the laws of 1996, subparagraph 18 of paragraph (b) of subdivision 9 as
added by section 21 of part H of chapter 1 of the laws of 2003, subpara-
graph 19 of paragraph (b) of subdivision 9 as added by section 1 of part
HH1 of chapter 57 of the laws of 2008, paragraphs (c-2) and (c-3) of
subdivision 9 as added by section 10 of part Y of chapter 63 of the laws
of 2000, paragraph (g) of subdivision 9 as added by chapter 178 of the
laws of 1965, subparagraph 1 and clauses (B) and (C) of subparagraph 3
of paragraph (g) of subdivision 9 as amended by chapter 613 of the laws
of 1976, clause (A) of subparagraph 1 of paragraph (g) of subdivision 9
as separately amended by chapters 675 and 836 of the laws of 1977,
clause (B) of subparagraph 1, clause (A) of subparagraph 2 and clause
(A) of subparagraph 3 of paragraph (g) of subdivision 9 as amended by
chapter 675 of the laws of 1977, item 1 of clause (B) of subparagraph 1
of paragraph (g) of subdivision 9 as amended by chapter 972 of the laws
of 1984, clause (B) of subparagraph 2 of paragraph (g) of subdivision 9
as amended by chapter 365 of the laws of 1979, clause (C) of subpara-
graph 2 of paragraph (g) of subdivision 9 as amended by chapter 1005 of
the laws of 1970, paragraph (h) of subdivision 9 as amended by chapter
606 of the laws of 1984, paragraph (n) of subdivision 9 as added by
section 1 of part O of chapter 85 of the laws of 2002, subdivision 12 as
added by chapter 828 of the laws of 1977, subdivisions 13, 14, and 15 as
added by section 1 of LBD number 74021-03-4 and subdivision 19 as added
by chapter 681 of the laws of 1997, is amended to read as follows:
S 208. Definitions. As used in this article:
1. The term "corporation" includes (a) an association within the mean-
ing of paragraph three of subsection (a) of section seventy-seven
hundred one of the internal revenue code (including a limited liability
company), (b) a joint-stock company or association, (c) a publicly trad-
ed partnership treated as a corporation for purposes of the internal
revenue code pursuant to section seventy-seven hundred four thereof and
(d) any business conducted by a trustee or trustees wherein interest or
ownership is evidenced by certificate or other written instrument.
"DISC" and "former DISC" mean any corporation which meets the require-
ments of subsection (a) of section nine hundred ninety-two of the inter-
nal revenue code[;].
1-A. The term "New York S corporation" means, with respect to any
taxable year, a corporation subject to tax under this article for which
an election is in effect pursuant to subsection (a) of section six
hundred sixty of this chapter for such year, any such year shall be
denominated a "New York S year", and such election shall be denominated
a "New York S election". The term "New York C corporation" means, with
respect to any taxable year, a corporation subject to tax under this
article which is not a New York S corporation, and any such year shall
be denominated a "New York C year". The term "termination year" means
any taxable year of a corporation during which the New York S election
terminates on a day other than the first day of such year. The portion
of the taxable year ending before the first day for which such termi-
nation is effective shall be denominated the "S short year", and the
S. 6359 6 A. 8559
portion of such year beginning on such first day shall be denominated
the "C short year". The term "New York S termination year" means any
termination year which is not also an S termination year for federal
purposes.
1-B. The term "QSSS" means a corporation which is a qualified subchap-
ter S subsidiary as defined in subparagraph (B) of paragraph three of
subsection (b) of section thirteen hundred sixty-one of the internal
revenue code. The term "exempt QSSS" means a QSSS exempt from tax under
this article as provided in paragraph (k) of subdivision nine of this
section, or a QSSS described in subclause (i) of clause (B) of subpara-
graph two of paragraph (k) of subdivision nine of this section, wherein
the parent corporation of the QSSS is subject to tax under this article,
and the assets, liabilities, income and deductions of the QSSS are
treated as the assets, liabilities, income and deductions of the parent
corporation. Where a QSSS is an exempt QSSS, then for all purposes under
this article:
(a) the assets, liabilities, income, deductions, property, payroll,
receipts, capital, credits, and all other tax attributes and elements of
economic activity of the QSSS shall be deemed to be those of the parent
corporation,
(b) the stocks, bonds and other securities issued by, and any indebt-
edness from, the QSSS shall not be [subsidiary,] investment or business
capital of the parent corporation,
(c) transactions between the parent corporation and the QSSS, includ-
ing the payment of interest and dividends, shall not be taken into
account, and
(d) general executive officers of the QSSS shall be deemed to be
general executive officers of the parent corporation.
2. The term "taxpayer" means any corporation subject to tax under this
article[;].
3. The term "subsidiary" means a corporation of which 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 by the
taxpayer[;].
4. The term ["subsidiary capital" means investments in the stock of
subsidiaries and any indebtedness from subsidiaries, exclusive of
accounts receivable acquired in the ordinary course of trade or business
for services rendered or for sales of property held primarily for sale
to customers, whether or not evidenced by written instrument, on which
interest is not claimed and deducted by the subsidiary for purposes of
taxation under article nine-A, thirty-two or thirty-three of this chap-
ter, provided, however, that, in the discretion of the commissioner,
there shall be deducted from subsidiary capital any liabilities which
are directly or indirectly attributable to subsidiary capital] "STOCK"
MEANS A DIRECT INTEREST IN A CORPORATION THAT IS TREATED AS EQUITY FOR
FEDERAL INCOME TAX PURPOSES.
5. (A) The term "investment capital" means investments in stocks[,
bonds and other securities, corporate and governmental,] THAT ARE HELD
BY THE TAXPAYER FOR MORE THAN SIX CONSECUTIVE MONTHS BUT ARE not held
for sale to customers in the regular course of business, [exclusive of
subsidiary capital] OR, IF THE TAXPAYER MAKES THE ELECTION PROVIDED FOR
IN SUBPARAGRAPH ONE OF PARAGRAPH (A) OF SUBDIVISION FIVE OF SECTION TWO
HUNDRED TEN-A OF THIS ARTICLE, ARE NOT QUALIFIED FINANCIAL INSTRUMENTS
AS DESCRIBED IN SUBDIVISION FIVE OF SECTION TWO HUNDRED TEN-A OF THIS
ARTICLE. STOCK IN A CORPORATION THAT IS CONDUCTING A UNITARY BUSINESS
WITH THE TAXPAYER, STOCK IN A CORPORATION THAT IS INCLUDED IN A COMBINED
S. 6359 7 A. 8559
REPORT WITH THE TAXPAYER PURSUANT TO THE COMMONLY OWNED GROUP ELECTION
IN SUBDIVISION FIVE OF SECTION TWO HUNDRED TEN-C OF THIS ARTICLE, and
stock issued by the taxpayer[, provided, however, that, in the
discretion of the commissioner, there] SHALL NOT CONSTITUTE INVESTMENT
CAPITAL. FOR PURPOSES OF THIS SUBDIVISION, IF THE TAXPAYER OWNS OR
CONTROLS, DIRECTLY OR INDIRECTLY, LESS THAN TWENTY PERCENT OF THE STOCK
OF A CORPORATION THAT ENTITLES THE HOLDERS THEREOF TO VOTE FOR THE
ELECTION OF TRUSTEES OR DIRECTORS, THAT CORPORATION WILL BE PRESUMED TO
BE CONDUCTING A BUSINESS THAT IS NOT UNITARY WITH THE BUSINESS OF THE
TAXPAYER.
(B) THERE shall be deducted from investment capital any liabilities
which are directly or indirectly attributable to investment capital[;
and provided, further, that investment]. IF THE AMOUNT OF THOSE LIABIL-
ITIES EXCEEDS THE AMOUNT OF INVESTMENT CAPITAL, THE AMOUNT OF INVESTMENT
CAPITAL WILL BE ZERO.
(C) INVESTMENT capital shall not include any such investments the
income from which is excluded from entire net income pursuant to the
provisions of paragraph (c-1) of subdivision nine of this section, and
that investment capital shall be computed without regard to liabilities
directly or indirectly attributable to such investments, but only if air
carriers organized in the United States and operating in the foreign
country or countries in which the taxpayer has its major base of oper-
ations and in which it is organized, resident or headquartered (if not
in the same country as its major base of operations) are not subject to
any tax based on or measured by capital imposed by such foreign country
or countries or any political subdivision thereof, or if taxed, are
provided an exemption, equivalent to that provided for herein, from any
tax based on or measured by capital imposed by such foreign country or
countries and from any such tax imposed by any political subdivision
thereof[;].
(D) IF A TAXPAYER ACQUIRES STOCK DURING THE SECOND HALF OF ITS TAXABLE
YEAR AND OWNS THAT STOCK ON THE LAST DAY OF THE TAXABLE YEAR, IT WILL BE
PRESUMED THAT THE TAXPAYER HELD THAT STOCK FOR MORE THAN SIX CONSECUTIVE
MONTHS DURING THE TAXABLE YEAR. HOWEVER, IF THE TAXPAYER DOES NOT IN
FACT HOLD THAT STOCK FOR MORE THAN SIX CONSECUTIVE MONTHS, THE TAXPAYER
MUST INCREASE ITS TOTAL BUSINESS CAPITAL IN THE IMMEDIATELY SUCCEEDING
TAXABLE YEAR BY THE AMOUNT INCLUDED IN INVESTMENT CAPITAL FOR THAT
STOCK, NET OF ANY LIABILITIES ATTRIBUTABLE TO THAT STOCK COMPUTED AS
PROVIDED IN PARAGRAPH (B) OF THIS SUBDIVISION.
(E) WHEN INCOME OR GAIN FROM A DEBT OBLIGATION OR OTHER SECURITY
CANNOT BE APPORTIONED TO THE STATE USING THE BUSINESS ALLOCATION
PERCENTAGE AS A RESULT OF UNITED STATES CONSTITUTIONAL PRINCIPLES, THE
DEBT OBLIGATION OR OTHER SECURITY WILL BE INCLUDED IN INVESTMENT CAPI-
TAL.
6. (A) The term "investment income" means income, including capital
gains in excess of capital losses, from investment capital, to the
extent included in computing entire net income, less, [(a)] in the
discretion of the commissioner, any INTEREST deductions allowable in
computing entire net income which are directly or indirectly attribut-
able to investment capital or investment income[, and (b) such portion
of any net operating loss deduction allowable in computing entire net
income, as the investment income, before such deduction, bears to entire
net income, before such deduction,] provided, however, that in no case
shall investment income exceed entire net income[;]. IF THE TAXPAYER
ATTRIBUTES INTEREST DEDUCTIONS TO INVESTMENT INCOME AND THE AMOUNT
SUBTRACTED EXCEEDS INVESTMENT INCOME, THE EXCESS OF THE INTEREST
S. 6359 8 A. 8559
DEDUCTIONS OVER INVESTMENT INCOME MUST BE ADDED BACK TO ENTIRE NET
INCOME.
(B) IN LIEU OF SUBTRACTING FROM INVESTMENT INCOME THE AMOUNT OF THOSE
INTEREST DEDUCTIONS, THE TAXPAYER MAY ELECT TO REDUCE ITS TOTAL INVEST-
MENT INCOME BY FORTY PERCENT. IF THE TAXPAYER MAKES THIS ELECTION, THE
TAXPAYER MUST ALSO MAKE THE ELECTIONS PROVIDED FOR IN PARAGRAPHS (B) AND
(C) OF SUBDIVISION SIX-A OF THIS SECTION. A TAXPAYER WHICH DOES NOT MAKE
THIS ELECTION BECAUSE IT HAS NO INVESTMENT CAPITAL WILL NOT BE PRECLUDED
FROM MAKING THOSE OTHER ELECTIONS.
6-A. (A) THE TERM "OTHER EXEMPT INCOME" MEANS THE SUM OF EXEMPT
SUBPART F INCOME AND EXEMPT UNITARY CORPORATION DIVIDENDS.
(B) "EXEMPT SUBPART F INCOME" MEANS THE INCOME, AS DEFINED IN SECTION
952 OF THE INTERNAL REVENUE CODE, RECEIVED FROM A CORPORATION THAT IS
CONDUCTING A UNITARY BUSINESS WITH THE TAXPAYER BUT IS NOT INCLUDED IN A
COMBINED REPORT WITH THE TAXPAYER, LESS, IN THE DISCRETION OF THE
COMMISSIONER, ANY INTEREST DEDUCTIONS DIRECTLY OR INDIRECTLY ATTRIBUT-
ABLE TO THAT INCOME. IN LIEU OF SUBTRACTING FROM ITS EXEMPT SUBPART F
INCOME THE AMOUNT OF THOSE INTEREST DEDUCTIONS, THE TAXPAYER MAY ELECT
TO REDUCE ITS TOTAL EXEMPT SUBPART F INCOME BY FORTY PERCENT. IF THE
TAXPAYER MAKES THIS ELECTION, THE TAXPAYER MUST ALSO MAKE THE ELECTIONS
PROVIDED FOR IN PARAGRAPH (B) OF SUBDIVISION SIX OF THIS SECTION AND
PARAGRAPH (C) OF THIS SUBDIVISION. A TAXPAYER WHICH DOES NOT MAKE THIS
ELECTION BECAUSE IT HAS NO EXEMPT SUBPART F INCOME WILL NOT BE PRECLUDED
FROM MAKING THOSE OTHER ELECTIONS.
(C) "EXEMPT UNITARY CORPORATION DIVIDENDS" MEANS THOSE DIVIDENDS FROM
A CORPORATION THAT IS CONDUCTING A UNITARY BUSINESS WITH THE TAXPAYER
BUT IS NOT INCLUDED IN A COMBINED REPORT WITH THE TAXPAYER, LESS, IN THE
DISCRETION OF THE COMMISSIONER, ANY INTEREST DEDUCTIONS DIRECTLY OR
INDIRECTLY ATTRIBUTABLE TO SUCH INCOME. IN LIEU OF SUBTRACTING FROM
THIS DIVIDEND INCOME THOSE INTEREST DEDUCTIONS, THE TAXPAYER MAY ELECT
TO REDUCE THE TOTAL AMOUNT OF THIS DIVIDEND INCOME BY FORTY PERCENT. IF
THE TAXPAYER MAKES THIS ELECTION, THE TAXPAYER MUST ALSO MAKE THE
ELECTIONS PROVIDED FOR IN PARAGRAPH (B) OF SUBDIVISION SIX OF THIS
SECTION AND PARAGRAPH (B) OF THIS SUBDIVISION. A TAXPAYER WHICH DOES NOT
MAKE THIS ELECTION BECAUSE IT HAS NOT RECEIVED ANY EXEMPT UNITARY CORPO-
RATION DIVIDENDS WILL NOT BE PRECLUDED FROM MAKING THOSE OTHER
ELECTIONS.
(D) IF THE TAXPAYER ATTRIBUTES INTEREST DEDUCTIONS TO OTHER EXEMPT
INCOME AND THE AMOUNT SUBTRACTED EXCEEDS OTHER EXEMPT INCOME, THE EXCESS
OF THE INTEREST DEDUCTIONS OVER OTHER EXEMPT INCOME MUST BE ADDED BACK
TO ENTIRE NET INCOME. IN NO CASE SHALL OTHER EXEMPT INCOME EXCEED ENTIRE
NET INCOME.
7. (a) The term "business capital" means all assets, other than
[subsidiary capital,] investment capital and stock issued by the taxpay-
er, less liabilities not deducted from [subsidiary or] investment capi-
tal [except that cash on hand and on deposit shall be treated as invest-
ment capital or as business capital as the taxpayer may elect].
BUSINESS CAPITAL SHALL INCLUDE ONLY THOSE ASSETS THE INCOME OR EXPENSE
OF WHICH ARE PROPERLY REFLECTED (OR WOULD HAVE BEEN PROPERLY REFLECTED
IF NOT FULLY DEPRECIATED OR EXPENSED OR DEPRECIATED OR EXPENSED TO A
NOMINAL AMOUNT) IN THE COMPUTATION OF ENTIRE NET INCOME FOR THE TAXABLE
YEAR.
(b) Provided, however, "business capital" shall not include assets to
the extent employed for the purpose of generating income which is
excluded from entire net income pursuant to the provisions of paragraph
(c-1) of subdivision nine of this section and shall be computed without
S. 6359 9 A. 8559
regard to liabilities directly or indirectly attributable to such
assets, but only if air carriers organized in the United States and
operating in the foreign country or countries in which the taxpayer has
its major base of operations and in which it is organized, resident or
headquartered (if not in the same country as its major base of oper-
ations) are not subject to any tax based on or measured by capital
imposed by such foreign country or countries or any political subdivi-
sion thereof, or if taxed, are provided an exemption, equivalent to that
provided for herein, from any tax based on or measured by capital
imposed by such foreign country or countries and from any such tax
imposed by any political subdivision thereof[;].
8. The term "business income" means entire net income minus investment
income[;] AND OTHER EXEMPT INCOME. IN NO EVENT SHALL THE SUM OF INVEST-
MENT INCOME AND OTHER EXEMPT INCOME EXCEED ENTIRE NET INCOME. IF THE
TAXPAYER MAKES THE ELECTION PROVIDED FOR IN SUBPARAGRAPH ONE OF PARA-
GRAPH (A) OF SUBDIVISION FIVE OF SECTION TWO HUNDRED TEN-A OF THIS ARTI-
CLE, THEN ALL INCOME FROM QUALIFIED FINANCIAL INSTRUMENTS SHALL CONSTI-
TUTE BUSINESS INCOME.
8-A. Provided, however, that with respect to a DISC or a former DISC,
the following provisions shall apply:
(a) investments in the stocks, bonds or other securities of a DISC or
any indebtedness from a DISC shall not be treated as [either subsidiary
capital or] investment capital under [subdivisions four or] SUBDIVISION
five of this section,
(b) any amounts deemed distributed from a DISC or a former DISC which
are taxable as dividends pursuant to subsection (b) of section nine
hundred ninety-five of the internal revenue code of nineteen hundred
fifty-four shall be treated as business income, except any such amounts
from a former DISC attributable to amounts includible in a taxpayer's
entire net income for a prior taxable year under subparagraph (B) of
paragraph (i) of subdivision nine of this section shall be excluded from
entire net income,
(c) any gain recognized for federal income tax purposes on the dispo-
sition of stock in a DISC, and any gain recognized on the disposition of
stock in a former DISC, includible in gross income as a dividend pursu-
ant to subsection (c) of section nine hundred ninety-five of the inter-
nal revenue code of nineteen hundred fifty-four, shall be treated as
business income, and
(d) except as provided in paragraph (i) of subdivision nine of this
section, any actual distribution from a DISC or a former DISC shall be
treated as business income except an actual distribution which for
federal income tax purposes is treated as made out of "other earnings
and profits" under section nine hundred ninety-six of the internal
revenue code of nineteen hundred fifty-four, in which case such actual
distribution shall be treated as [either subsidiary income or] invest-
ment income under this article.
[8-B. (a) The term "minimum taxable income" shall mean the entire net
income of the taxpayer for the taxable year:
(1) increased by the amount of the federal items of tax preference set
forth in section fifty-seven of the internal revenue code (with the
modifications set forth in paragraph (b) of this subdivision), which
items of tax preference shall have the same meaning and be computed in
the same manner as under section fifty-seven of the internal revenue
code,
(2) determined with the federal adjustments described in paragraph (c)
of this subdivision, which adjustments shall have the same meaning and
S. 6359 10 A. 8559
be computed in the same manner as under sections fifty-six and fifty-
eight of the internal revenue code,
(3) increased by the net operating loss deduction otherwise allowed
under paragraph (f) of subdivision nine of this section, and
(4) reduced, for taxable years beginning after nineteen hundred nine-
ty-three, by the alternative net operating loss deduction, as defined in
paragraph (d) of this subdivision.
(b) The federal items of tax preference referred to hereinabove shall
be modified by deducting "tax-exempt interest" and "accelerated depreci-
ation or amortization on certain property placed in service before Janu-
ary 1, 1987", as determined under paragraphs five and seven of
subsection (a) of section fifty-seven of the internal revenue code.
(c) The adjustments referred to hereinabove shall be:
(1) "Depreciation" as determined under paragraph one of subsection (a)
of section fifty-six of the internal revenue code. For purposes of this
subparagraph, the depreciation item of adjustment provided for here
shall not include any amount attributable to property for which the tax
benefits of the accelerated cost recovery system are not available under
this article by reason of subparagraph ten of paragraph (b) of subdivi-
sion nine of this section;
(2) "Mining exploration and development costs" as determined under
paragraph two of subsection (a) of section fifty-six of the internal
revenue code;
(3) "Treatment of certain long-term contracts" as determined under
paragraph three of subsection (a) of section fifty-six of the internal
revenue code;
(4) "Installment sales of certain property" as determined under para-
graph six of subsection (a) of section fifty-six of the internal revenue
code;
(5) "Circulation expenditures of personal holding companies" as deter-
mined under subparagraph (C) of paragraph two of subsection (b) of
section fifty-six of the internal revenue code;
(6) "Merchant marine capital construction funds" as determined under
paragraph two of subsection (c) of section fifty-six of the internal
revenue code;
(7) "Disallowance of passive activity loss" as determined under
subsection (b) of section fifty-eight of the internal revenue code; and
(8) "Adjusted basis", as it appears in paragraph seven of subsection
(a) of section fifty-six of the internal revenue code, but without
taking into account the references therein to paragraph five of
subsection (a) of section fifty-six of the internal revenue code.
(d) The term "alternative net operating loss deduction" means the net
operating loss deduction allowed for the taxable year under paragraph
(f) of subdivision nine of this section, except as provided herein.
(1)(A) The net operating loss for any year beginning after nineteen
hundred eighty-nine which is included in determining such deduction
shall be determined with the adjustments provided in subparagraph two of
paragraph (a) of this subdivision, and shall be reduced by the items of
tax preference determined under subparagraph one of paragraph (a) of
this subdivision, attributable to such year. An item of tax preference
shall be taken into account only to the extent such item increased the
amount of the net operating loss for the taxable year under paragraph
(f) of subdivision nine of this section.
(B) In the case of loss years beginning before nineteen hundred nine-
ty, the amount of the net operating loss which may be carried over to
taxable years beginning after nineteen hundred eighty-nine shall be
S. 6359 11 A. 8559
equal to an amount which may be carried from the loss year to the first
taxable year of the taxpayer beginning after nineteen hundred eighty-
nine.
(2) In determining the amount of such deduction, loss carryforwards
and carrybacks shall, subject to the provisions of subparagraph five of
paragraph (f) of subdivision nine of this section, be computed in the
manner set forth in paragraph two of subsection (b) of section one
hundred seventy-two of the internal revenue code, except that, for the
reference therein to taxable income, there shall be substituted the
phrase "ninety percent of minimum taxable income determined without
regard to the alternative net operating loss deduction".
(3) The amount of such deduction shall not exceed ninety percent of
minimum taxable income determined without regard to such deduction,
provided, however, the term "ninety percent" shall be read as "forty-
five percent" with respect to taxable years beginning in nineteen
hundred ninety-four.
(e) The tax commission may, whenever necessary in order to properly
reflect the minimum taxable income of any taxpayer, determine the year
or period in which any item of income or deduction shall be included,
without regard to the method of accounting employed by the taxpayer.
(f) If the period covered by a report under this article is other than
the period covered by the report to the United States treasury depart-
ment, the minimum taxable income shall be appropriately modified pursu-
ant to regulations promulgated by the tax commission.]
9. The term "entire net income" means total net income from all sourc-
es, which shall be presumably the same as the entire taxable income
[(but not alternative minimum taxable income)], WHICH, EXCEPT AS HEREIN-
AFTER PROVIDED IN THIS SUBDIVISION,
(i) [which] the taxpayer is required to report to the United States
treasury department, or
(ii) [which] the taxpayer would have been required to report to the
United States treasury department if it had not made an election under
subchapter s of chapter one of the internal revenue code, or
(iii) [which] the taxpayer, in the case of a corporation which is
exempt from federal income tax (other than the tax on unrelated business
taxable income imposed under section 511 of the internal revenue code)
but which is subject to tax under this article, would have been required
to report to the United States treasury department but for such
exemption, [except as hereinafter provided, and subject to any modifica-
tion required by paragraphs (d) and (e) of subdivision three of section
two hundred ten of this article] OR
(IV) IN THE CASE OF A CORPORATION ORGANIZED UNDER THE LAWS OF A COUN-
TRY OTHER THAN THE UNITED STATES, IS EFFECTIVELY CONNECTED WITH THE
CONDUCT OF A TRADE OR BUSINESS WITHIN THE UNITED STATES AS DETERMINED
UNDER SECTION 882 OF THE INTERNAL REVENUE CODE,
(a) Entire net income shall not include:
[(1) income, gains and losses from subsidiary capital which do not
include the amount of a recovery in respect of any war loss except for
such amounts from a former DISC which are treated as business income
under subdivision eight-A of this section,
(2) fifty percent of dividends (A) other than from subsidiaries, and
(B) other than amounts treated as business income under subdivision
eight-A of this section, on shares of stock which conform to the
requirements of subsection (c) of section two hundred forty-six of the
internal revenue code.]
(3) bona fide gifts,
S. 6359 12 A. 8559
(4) income and deductions with respect to amounts received from school
districts and from corporations and associations, organized and operated
exclusively for religious, charitable or educational purposes, no part
of the net earnings of which inures to the benefit of any private share-
holder or individual, for the operation of school buses,
(5) (i) any refund or credit of a tax imposed under this article,
article twenty-three, or FORMER article thirty-two of this chapter, for
which tax no exclusion or deduction was allowed in determining the
taxpayer's entire net income under this article, article twenty-three,
or FORMER article thirty-two of this chapter for any prior year, (ii) a
refund or credit of general corporation tax allowed by subdivision elev-
en of section 11-604 of the administrative code of the city of New York,
or (iii) any refund or credit of a tax imposed under sections one
hundred eighty-three, one hundred eighty-three-a, one hundred eighty-
four or one hundred eighty-four-a of this chapter, and
(6) any amount treated as dividends pursuant to section seventy-eight
of the internal revenue code and not [otherwise deductible under subpar-
agraphs one and two of this paragraph] TREATED AS OTHER EXEMPT INCOME
UNDER SUBDIVISION SIX-A OF THIS SECTION;
(7) that portion of wages and salaries paid or incurred for the taxa-
ble year for which a deduction is not allowed pursuant to the provisions
of section two hundred eighty-C of the internal revenue code.
[(8) in the case of a taxpayer who is separately or as a partner of a
partnership doing an insurance business as a member of the New York
insurance exchange described in section six thousand two hundred one of
the insurance law, any item of income, gain, loss or deduction of such
business which is the taxpayer's distributive or pro rata share for
federal income tax purposes or which the taxpayer is required to take
into account separately for federal income tax purposes.]
(9) for taxable years beginning after December thirty-first, nineteen
hundred eighty-one, except with respect to property which is a qualified
mass commuting vehicle described in subparagraph (D) of paragraph eight
of subsection (f) of section one hundred sixty-eight of the internal
revenue code (relating to qualified mass commuting vehicles) and proper-
ty of a taxpayer principally engaged in the conduct of aviation (other
than air freight forwarders acting as principal and like indirect air
carriers) which is placed in service before taxable years beginning in
nineteen hundred eighty-nine, any amount which is included in the
taxpayer's federal taxable income solely as a result of an election made
pursuant to the provisions of such paragraph eight as it was in effect
for agreements entered into prior to January first, nineteen hundred
eighty-four;
(10) for taxable years beginning after December thirty-first, nineteen
hundred eighty-one, except with respect to property which is a qualified
mass commuting vehicle described in subparagraph (D) of paragraph eight
of subsection (f) of section one hundred sixty-eight of the internal
revenue code (relating to qualified mass commuting vehicles) and proper-
ty of a taxpayer principally engaged in the conduct of aviation (other
than air freight forwarders acting as principal and like indirect air
carriers) which is placed in service before taxable years beginning in
nineteen hundred eighty-nine, any amount which the taxpayer could have
excluded from federal taxable income had it not made the election
provided for in such paragraph eight as it was in effect for agreements
entered into prior to January first, nineteen hundred eighty-four;
(11) the amount deductible pursuant to paragraph (j) of this subdivi-
sion; and
S. 6359 13 A. 8559
(12) upon the disposition of property to which paragraph (j) of this
subdivision applies, the amount, if any, by which the aggregate of the
amounts described in subparagraph ten of paragraph (b) of this subdivi-
sion attributable to such property exceeds the aggregate of the amounts
described in paragraph (j) of this subdivision attributable to such
property; and
[(13) if the added tax provided for in either (i) former subdivision
two of section one hundred eighty-two of this chapter (relating to real
estate corporations) or (ii) former subdivision one-a of section two
hundred nine of this chapter (relating to real estate corporations) has
been imposed upon the taxpayer, any income which has been used in
computing such tax.]
(14) The amount deductible pursuant to paragraph [(l)] (I) of this
subsection.
[(15) In the case of an attorney-in-fact, with respect to which a
mutual insurance company, which is an interinsurer or a reciprocal
insurer and is subject to tax under subdivision (a) of section fifteen
hundred ten of this chapter, has made the election provided for under
section eight hundred thirty-five of the Internal Revenue Code, an
amount equal to the excess, if any, of the amounts paid or incurred by
such interinsurer or reciprocal insurer in the taxable year to the
attorney-in-fact over the deduction allowed to such interinsurer or
reciprocal insurer with respect to amounts paid or incurred in the taxa-
ble year to the attorney-in-fact under subsection (b) of such section
eight hundred thirty-five of the Internal Revenue Code.]
(16) In the case of a taxpayer subject to the modification provided by
subparagraph sixteen of paragraph (b) of this subdivision, the amount
required to be recaptured pursuant to subsection (d) of section 179 of
the internal revenue code with respect to property upon which such
modification was based.
(17) FOR TAXABLE YEARS BEGINNING AFTER DECEMBER THIRTY-FIRST, TWO
THOUSAND TWO, THE AMOUNT DEDUCTIBLE PURSUANT TO PARAGRAPH (N-1) OF THIS
SUBDIVISION.
(18) the amount of income or gain included in federal taxable income
of a taxpayer that is a partner in a qualified entity or is a qualified
entity that is located both within and without a New York state inno-
vation hot spot, to the extent that the income or gain is attributable
to the operations of a qualified entity at or as part of the New York
state innovation hot spot as provided in section thirty-eight of this
chapter.
(19) THE AMOUNT COMPUTED PURSUANT TO PARAGRAPH (R) OR (S) OF THIS
SUBDIVISION, BUT NOT BOTH SUCH AMOUNTS.
(b) Entire net income shall be determined without the exclusion,
deduction or credit of:
(1) [the amount of any specific exemption or credit allowed in any law
of the United States imposing any tax on or measured by the income of
corporations,] IN THE CASE OF A CORPORATION ORGANIZED UNDER THE LAW OF A
COUNTRY OTHER THAN THE UNITED STATES, EXCEPT AS TREATED AS OTHER EXEMPT
INCOME UNDER SUBDIVISION SIX-A OF THIS SECTION, (I) ANY PART OF ANY
INCOME FROM DIVIDENDS OR INTEREST ON ANY KIND OF STOCK, SECURITIES OR
INDEBTEDNESS, BUT ONLY IF SUCH INCOME IS TREATED AS EFFECTIVELY
CONNECTED WITH THE CONDUCT OF A TRADE OR BUSINESS IN THE UNITED STATES
PURSUANT TO SECTION 864 OF THE INTERNAL REVENUE CODE, (II) ANY INCOME
EXEMPT FROM FEDERAL TAXABLE INCOME UNDER ANY TREATY OBLIGATION OF THE
UNITED STATES, BUT ONLY IF SUCH INCOME WOULD BE TREATED AS EFFECTIVELY
CONNECTED IN ABSENCE OF SUCH EXEMPTION PROVIDED THAT SUCH TREATY OBLI-
S. 6359 14 A. 8559
GATION DOES NOT PRECLUDE THE TAXATION OF SUCH INCOME BY A STATE, OR
(III) ANY INCOME WHICH WOULD BE TREATED AS EFFECTIVELY CONNECTED IF SUCH
INCOME WERE NOT EXCLUDED FROM GROSS INCOME PURSUANT TO SUBSECTION (A) OF
SECTION 103 OF THE INTERNAL REVENUE CODE;
(2) any part of any income from dividends or interest on any kind of
stock, securities or indebtedness, [except as provided in clauses (1)
and (2) of paragraph (a) hereof] TREATED AS OTHER EXEMPT INCOME UNDER
SUBDIVISION SIX-A OF THIS SECTION,
(3) taxes on or measured by profits or income paid or accrued to the
United States, any of its possessions or to any foreign country, includ-
ing taxes in lieu of any of the foregoing taxes otherwise generally
imposed by any foreign country or by any possession of the United
States,
(3-a) taxes on or measured by profits or income, or which include
profits or income as a measure, paid or accrued to any other state of
the United States, or any political subdivision thereof, or to the
District of Columbia, including taxes expressly in lieu of any of the
foregoing taxes otherwise generally imposed by any other state of the
United States, or any political subdivision thereof, or the District of
Columbia;
(4) taxes imposed under this article and article thirty-two AS IN
EFFECT ON DECEMBER THIRTY-FIRST, TWO THOUSAND FOURTEEN and sections one
hundred eighty-three, one hundred eighty-three-a, one hundred eighty-
four and one hundred eighty-four-a of this chapter,
(4-a)(A) [the entire amount allowable as an exclusion or deduction for
stock transfer taxes imposed by article twelve of this chapter in deter-
mining the entire taxable income which the taxpayer is required to
report to the United States treasury department but only to the extent
that such taxes are incurred and paid in market making transactions,
(B)] in those instances where a credit for the special additional mort-
gage recording tax credit is allowed under [paragraph (a) of] subdivi-
sion [seventeen] NINE of section two hundred [ten] TEN-B of this arti-
cle, the amount allowed as an exclusion or deduction for the special
additional mortgage recording tax imposed by subdivision one-a of
section two hundred fifty-three of this chapter in determining the
entire taxable income which the taxpayer is required to report to the
United States treasury department, and [(C)] (B) unless the credit
allowed pursuant to subdivision [seventeen] NINE of section two hundred
[ten] TEN-B of this article is reflected in the computation of the gain
or loss so as to result in an increase in such gain or decrease of such
loss, for federal income tax purposes, from the sale or other disposi-
tion of the property with respect to which the special additional mort-
gage recording tax imposed pursuant to subdivision one-a of section two
hundred fifty-three of this chapter was paid, the amount of the special
additional mortgage recording tax imposed by subdivision one-a of
section two hundred fifty-three of this chapter which was paid and which
is reflected in the computation of the basis of the property so as to
result in a decrease in such gain or increase in such loss for federal
income tax purposes from the sale or other disposition of the property
with respect to which such tax was paid.
(6) [in the discretion of the tax commission, any amount of interest
directly or indirectly and any other amount directly or indirectly
attributable as a carrying charge or otherwise to subsidiary capital or
to income, gains or losses from subsidiary capital] ANY AMOUNT ALLOWED
AS A DEDUCTION FOR THE TAXABLE YEAR UNDER SECTION 172 OF THE INTERNAL
S. 6359 15 A. 8559
REVENUE CODE, INCLUDING CARRYOVERS OF DEDUCTIONS FROM PRIOR TAXABLE
YEARS.
[(7) in the case of a taxpayer who is separately or as a partner of a
partnership doing an insurance business as a member of the New York
insurance exchange described in section six thousand two hundred one of
the insurance law, such taxpayer's distributive or pro rata share of the
allocated entire net income of such business as determined under
sections fifteen hundred three and fifteen hundred four of this chapter,
provided however, in the event such allocated entire net income is a
loss, such taxpayer's distributive or pro rata share of such loss shall
not be subtracted from federal taxable income in computing entire net
income under this subdivision.]
(8) for taxable years beginning after December thirty-first, nineteen
hundred eighty-one, except with respect to property which is a qualified
mass commuting vehicle described in subparagraph (D) of paragraph eight
of subsection (f) of section one hundred sixty-eight of the internal
revenue code (relating to qualified mass commuting vehicles) and proper-
ty of a taxpayer principally engaged in the conduct of aviation (other
than air freight forwarders acting as principal and like indirect air
carriers) which is placed in service before taxable years beginning in
nineteen hundred eighty-nine, any amount which the taxpayer claimed as a
deduction in computing its federal taxable income solely as a result of
an election made pursuant to the provisions of such paragraph eight as
it was in effect for agreements entered into prior to January first,
nineteen hundred eighty-four;
(9) for taxable years beginning after December thirty-first, nineteen
hundred eighty-one, except with respect to property which is a qualified
mass commuting vehicle described in subparagraph (D) of paragraph eight
of subsection (f) of section one hundred sixty-eight of the internal
revenue code (relating to qualified mass commuting vehicles) and proper-
ty of a taxpayer principally engaged in the conduct of aviation (other
than air freight forwarders acting as principal and like indirect air
carriers) which is placed in service before taxable years beginning in
nineteen hundred eighty-nine, any amount which the taxpayer would have
been required to include in the computation of its federal taxable
income had it not made the election permitted pursuant to such paragraph
eight as it was in effect for agreements entered into prior to January
first, nineteen hundred eighty-four;
(10) in the case of property placed in service in taxable years begin-
ning before nineteen hundred ninety-four, for taxable years beginning
after December thirty-first, nineteen hundred eighty-one, except with
respect to property subject to the provisions of section two hundred
eighty-F of the internal revenue code, property subject to the
provisions of section one hundred sixty-eight of the internal revenue
code which is placed in service in this state in taxable years beginning
after December thirty-first, nineteen hundred eighty-four and property
of a taxpayer principally engaged in the conduct of aviation (other than
air freight forwarders acting as principal and like indirect air carri-
ers) which is placed in service before taxable years beginning in nine-
teen hundred [eight-nine] EIGHTY-NINE, the amount allowable as a
deduction determined under section one hundred sixty-eight of the inter-
nal revenue code;
(11) upon the disposition of property to which paragraph (j) of this
subdivision applies, the amount, if any, by which the aggregate of the
amounts described in such paragraph (j) attributable to such property
S. 6359 16 A. 8559
exceeds the aggregate of the amounts described in subparagraph ten of
this paragraph attributable to such property.
(15) Real property taxes paid on qualified agricultural property and
deducted in determining federal taxable income, to the extent of the
amount of the agricultural property tax credit allowed under subdivision
[twenty-two] ELEVEN of section two hundred [ten] TEN-B of this article.
(16) In the case of a taxpayer which is not an eligible farmer as
defined in paragraph (b) of subdivision [twenty-two] ELEVEN of section
two hundred [ten] TEN-B of this article, the amount of any deduction
claimed pursuant to section 179 of the internal revenue code with
respect to a sport utility vehicle which is not a passenger automobile
as defined in paragraph 5 of subsection (d) of section 280F of the
internal revenue code.
(17) for taxable years beginning after December thirty-first, two
thousand two, in the case of qualified property described in paragraph
two of subsection k of section 168 of the internal revenue code, other
than qualified resurgence zone property described in paragraph (q) of
this subdivision, and other than qualified New York Liberty Zone proper-
ty described in paragraph two of subsection b of section 1400L of the
internal revenue code (without regard to clause (i) of subparagraph (C)
of such paragraph), which was placed in service on or after June first,
two thousand three, the amount allowable as a deduction under section
167 of the internal revenue code.
(18) Premiums paid for environmental remediation insurance, as defined
in section twenty-three of this chapter, and deducted in determining
federal taxable income, to the extent of the amount of the environmental
remediation insurance credit allowed under such section twenty-three and
subdivision [thirty-five] NINETEEN of section two hundred [ten] TEN-B of
this article.
(19) The amount of any deduction allowed pursuant to section one
hundred ninety-nine of the internal revenue code.
(20) The amount of any federal deduction for taxes imposed under arti-
cle twenty-three of this chapter.
[(c) Entire net income shall include income within and without the
United States;]
(c-1)(1) Notwithstanding any other provision of this article, in the
case of a taxpayer which is a foreign air carrier holding a foreign air
carrier permit issued by the United States department of transportation
pursuant to section four hundred two of the federal aviation act of
nineteen hundred fifty-eight, as amended, and which is qualified under
subparagraph two of this paragraph, entire net income shall not include,
and shall be computed without the deduction of, amounts directly or
indirectly attributable to, (i) any income derived from the interna-
tional operation of aircraft as described in and subject to the
provisions of section eight hundred eighty-three of the internal revenue
code, (ii) income without the United States which is derived from the
operation of aircraft, and (iii) income without the United States which
is of a type described in subdivision (a) of section eight hundred
eighty-one of the internal revenue code except that it is derived from
sources without the United States. Entire net income shall include
income described in clauses (i), (ii) and (iii) of this subparagraph in
the case of taxpayers not described in the previous sentence.
(2) A taxpayer is qualified under this subparagraph if air carriers
organized in the United States and operating in the foreign country or
countries in which the taxpayer has its major base of operations and in
which it is organized, resident or headquartered (if not in the same
S. 6359 17 A. 8559
country as its major base of operations) are not subject to any income
tax or other tax based on or measured by income or receipts imposed by
such foreign country or countries or any political subdivision thereof,
or if so subject to such tax, are provided an exemption from such tax
equivalent to that provided for herein.
(c-2) Adjustments by qualified public utilities. (1) In the case of a
taxpayer which is a qualified public utility, entire net income shall be
computed with the adjustments set forth in this paragraph.
(2) Definitions. (A) Qualified public utility. The term "qualified
public utility" means a taxpayer which: (i) on December thirty-first,
nineteen hundred ninety-nine, was subject to the ratemaking supervision
of the state department of public service, and (ii) for the year ending
on December thirty-first, nineteen hundred ninety-nine, was subject to
tax under former section one hundred eighty-six of this chapter.
(B) Transition property. The term "transition property" means property
placed in service by the taxpayer before January first, two thousand,
for which a depreciation deduction is allowed under section one hundred
sixty-seven of the internal revenue code.
(3) Federal depreciation disallowed. With respect to transition prop-
erty, the deduction for federal income tax purposes for depreciation
shall not be allowed.
(4) New York depreciation. With respect to transition property, a
deduction shall be allowed for the depreciation expense shown on the
books and records of the taxpayer for the taxable year and determined in
accordance with generally accepted accounting principles.
(5) Regulatory assets. A deduction shall be allowed for amounts recog-
nized as expense on the books and records of the taxpayer for the taxa-
ble year, which amounts were recognized as expense for federal income
tax purposes in a taxable year ending on or before December thirty-
first, nineteen hundred ninety-nine, where: (A) such amounts represent
expenditures which, when made, were charged to a deferred debit account
or similar asset account on the books and records of the taxpayer, and
where (B) the recognition of expense on the books and records of the
taxpayer is matched by revenue stemming from a procedure or adjustment
allowing the recovery of such expenditures, and where (C) such revenue
is recognized for federal income tax purposes in the taxable year.
(6) Basis for gain or loss. (A) Recognition transactions. (i) General
rule - book basis. Except as provided in subclause (ii) of this clause,
where transition property is sold or otherwise disposed of in the taxa-
ble year in a transaction of the type requiring recognition of gain or
loss for federal income tax purposes, the basis for determining the
amount of such gain or loss under this article shall be the cost of the
property less the accumulated depreciation on the property determined on
the books and records of the taxpayer in accordance with generally
accepted accounting principles.
(ii) Qualified gain - New York basis. Where a sale or disposition
described in subclause (i) of this clause results in recognition of gain
for federal income tax purposes, and where either (I) such recognition
occurs in a taxable year ending after nineteen hundred ninety-nine and
before two thousand ten, or (II) such recognition is with respect to a
nuclear electric generating facility, the basis for determining the
amount of such gain under this article shall be the cost of the property
less the aggregate of the New York depreciation deductions on the prop-
erty determined under subparagraph four of this paragraph.
(iii) No conversion of gain to loss. In the event that the basis
determined under subclause (ii) of this clause results in determination
S. 6359 18 A. 8559
of a loss on the sale or disposition of the property, no gain or loss
shall be recognized under this article with respect to such sale or
disposition.
(B) Nonrecognition transactions. (i) Carryover basis. (I) where tran-
sition property is disposed of ("original disposition") in a transaction
of a type requiring deferral of recognition of gain or loss for federal
income tax purposes, and where (II) there is a subsequent recognition of
gain or loss for federal income tax purposes ("clause B gain or loss"),
the amount of which is determined by reference, in whole or in part, to
the basis of such transition property ("underlying transition proper-
ty"), then (III) the amount of such clause B gain or loss under this
article shall be adjusted as provided in subclause (ii) or (iii) of this
clause.
(ii) General rule - book basis adjustment. Except as provided in
subclause (iii) of this clause, the amount of clause B gain shall be
reduced, or the amount of clause B loss increased, by the amount by
which the book basis of the underlying transition property on the date
of original disposition (determined using the provisions of subclause
(i) of clause (A) of this subparagraph) exceeds the federal income tax
basis of such property on such date.
(iii) Qualified gain - New York basis adjustment. Where clause B gain
either (I) occurs in a taxable year ending after nineteen hundred nine-
ty-nine and before two thousand ten, or (II) is with respect to a nucle-
ar electric generating facility, the amount of such gain under this
article shall be reduced, but not below zero, by the amount by which the
New York basis of the underlying transition property on the date of
original disposition (determined using the provisions of subclause (ii)
of clause (A) of this subparagraph) exceeds the federal income tax basis
of such property on such date.
(iv) Application to replacement property and transferee taxpayers.
This clause shall apply whether the clause B gain or loss: (I) is with
respect to either transition property or depreciable property the basis
of which is determined by reference to transition property, or (II) is
recognized by either a qualified public utility or by a taxpayer which
is a transferee of transition property (whether or not such transferee
is a qualified public utility, notwithstanding subparagraph one of this
paragraph).
(c-3) Depreciation adjustments by qualified power producers and pipe-
line companies. (1) In the case of a qualified taxpayer, entire net
income shall be computed with the depreciation adjustments set forth in
this paragraph.
(2) Definitions. (A) Qualified taxpayer. The term "qualified taxpayer"
means a qualified power producer or a qualified pipeline.
(B) Qualified power producer. The term "qualified power producer"
means a taxpayer which: (i) on December thirty-first, nineteen hundred
ninety-nine, was not subject to the ratemaking supervision of the state
department of public service, and (ii) for the year ending on December
thirty-first, nineteen hundred ninety-nine, was subject to tax under
former section one hundred eighty-six of this chapter on account of its
being principally engaged in the business of supplying electricity.
(C) Qualified pipeline. The term "qualified pipeline" means a taxpayer
which: (i) on December thirty-first, nineteen hundred ninety-nine, was
subject to the ratemaking supervision of either the federal energy regu-
latory commission or the state department of public service, and (ii)
for the year ending on December thirty-first, nineteen hundred ninety-
nine, was subject to tax under sections one hundred eighty-three and one
S. 6359 19 A. 8559
hundred eighty-four of this chapter on account of its being principally
engaged in the business of pipeline transmission.
(D) Transition property. The term "transition property" means property
placed in service by a qualified taxpayer before January first, two
thousand, for which a depreciation deduction is allowed under section
one hundred sixty-seven of the internal revenue code.
(3) Federal depreciation disallowed. With respect to transition prop-
erty, the deduction for federal income tax purposes for depreciation
shall not be allowed.
(4) New York depreciation. With respect to transition property, a
deduction shall be allowed for the depreciation expense computed as
provided in this subparagraph. (A) All transition property shown on the
books and records of the taxpayer on January first, two thousand shall
be treated as a single asset placed in service on such date. The New
York basis for purposes of computing the depreciation deduction on such
single asset shall be the net book value of such transition property
determined on the first day of the federal taxable year ending in two
thousand (or on the date any such property is placed in service, if
later) adjusted as provided in clause (B) of this subparagraph.
(B) If transition property is sold or otherwise disposed of, the New
York basis of the single asset shall be reduced on the date of such sale
or disposition by the amount of the adjusted federal tax basis of such
property on such date.
(C) The New York depreciation deduction allowed for any taxable year
with respect to such single asset shall be computed using the straight-
line method, a twenty-year life, and a salvage value of zero.
(D) For purposes of this subparagraph, the term "net book value" means
cost reduced by accumulated depreciation shown on the books and records
of the taxpayer and determined, in the case of a qualified power produc-
er, in accordance with generally accepted accounting principles; and in
the case of a qualified pipeline, in accordance with the taxpayer's
regulatory reports filed with the federal energy regulatory commission
or state department of public service.
(d) The [tax commission] COMMISSIONER may, whenever necessary in order
properly to reflect the entire net income of any taxpayer, determine the
year or period in which any item of income or deduction shall be
included, without regard to the method of accounting employed by the
taxpayer[;].
(e) The entire net income of any bridge commission created by act of
congress to construct a bridge across an international boundary means
its gross income less the expense of maintaining and operating its prop-
erties, the annual interest upon its bonds and other obligations, and
the annual charge for the retirement of such bonds or obligations at
maturity[;].
[(f) A net operating loss deduction shall be allowed which shall be
presumably the same as the net operating loss deduction allowed under
section one hundred seventy-two of the internal revenue code, or which
would have been allowed if the taxpayer had not made an election under
subchapter s of chapter one of the internal revenue code, except that in
every instance where such deduction is allowed under this article:
(1) any net operating loss included in determining such deduction
shall be adjusted to reflect the inclusions and exclusions from entire
net income required by paragraphs (a), (b) and (g) hereof,
(2) such deduction shall not include any net operating loss sustained
during any taxable year beginning prior to January first, nineteen
S. 6359 20 A. 8559
hundred sixty-one, or during any taxable year in which the taxpayer was
not subject to the tax imposed by this article,
(3) such deduction shall not exceed the deduction for the taxable year
allowed under section one hundred seventy-two of the internal revenue
code, or the deduction for the taxable year which would have been
allowed if the taxpayer had not made an election under subchapter s of
chapter one of the internal revenue code,
(4) in the case of a New York S corporation, such deduction shall not
include any net operating loss sustained during a New York C year or
during a New York S year beginning prior to nineteen hundred ninety, and
in the case of a New York C corporation, such deduction shall not
include any net operating loss sustained during a New York S year,
provided, 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 net
operating loss may be carried back or carried forward, and
(5) the net operating loss deduction allowed under section one hundred
seventy-two of the internal revenue code shall for purposes of this
paragraph be determined as if the taxpayer had elected under such
section to relinquish the entire carryback period with respect to net
operating losses, except with respect to the first ten thousand dollars
of each of such losses, sustained during taxable years ending after June
thirtieth, nineteen hundred eighty-nine.
(g) For taxable years commencing prior to January first, nineteen
hundred eighty-seven, at the election of the taxpayer, a deduction shall
be allowed for expenditures paid or incurred during the taxable year for
the construction, reconstruction, erection or improvement of either
industrial waste treatment facilities or air pollution control facili-
ties, or, with respect to taxable years beginning on or after January
first, nineteen hundred seventy-seven and before January first, nineteen
hundred eighty-one, industrial waste treatment controlled process facil-
ities or air pollution controlled process facilities.
(1) (A) (1) The term "industrial waste treatment facilities" shall
mean 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.
(2) The term "industrial waste treatment controlled process facility"
shall mean such portion of the cost of an industrial production facility
designed for the purpose of obviating the need for industrial waste
treatment facilities as defined in item one of this clause as shall
exceed the cost of an industrial production facility of equal production
capacity which if constructed would require industrial waste treatment
facilities to meet emission standards in compliance with the provisions
of the environmental conservation law and the codes, rules, regulations,
permits or orders issued pursuant thereto but only to the extent of the
cost of such industrial waste treatment facilities.
(B) (1) The term "air pollution control facilities" shall mean facili-
ties which remove, reduce, or render less noxious air contaminants emit-
ted from an air contamination source (as the terms "air contaminant" and
"air contamination source" are defined in section 19-0107 of the envi-
ronmental 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
S. 6359 21 A. 8559
the primary purpose of salvaging materials which are usable in the manu-
facturing 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 facili-
ties 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 conserva-
tion law.
(2) The term "air pollution controlled process facility" shall mean
such portion of the cost of an industrial production facility designed
for the purpose of obviating the need for air pollution control facili-
ties as defined in item one of this clause as shall exceed the cost of
an industrial production facility of equal productive capacity which if
constructed would require air pollution control facilities to inert
emission standards as established pursuant to title three of article
nineteen of the environmental conservation law but only to the extent of
the cost of such air pollution control facilities.
(2) However, such deduction shall be allowed only
(A) 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
construction, reconstruction, erection or improvement of which, in the
case of industrial waste treatment facilities, is initiated on or after
January first, nineteen hundred sixty-five or which, in the case of air
pollution control facilities, is initiated on or after January first,
nineteen hundred sixty-six, or which in the case of industrial waste
treatment controlled process facilities or air pollution controlled
process facilities is initiated on and after January first, nineteen
hundred seventy-seven, and
(B) on condition that such facilities have been certified by the state
commissioner of environmental conservation or his designated represen-
tative, pursuant to 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,
and
(C) on condition that entire net income for the taxable year and all
succeeding taxable years be computed without any deductions for such
expenditures or for depreciation or amortization of the same property
other than the deductions allowed by this paragraph (g), except to the
extent that the basis of the property may be attributable to factors
other than such expenditures, or in case a deduction is allowable pursu-
ant to this paragraph for only a part of such expenditures, on condition
that any deduction allowed for federal income tax purposes for such
expenditures or for depreciation or amortization of the same property be
proportionately reduced in computing entire net income for the taxable
year and all succeeding taxable years, and
(D) where the election provided for in paragraph (d) of subdivision
three of section two hundred ten of this chapter has not been exercised
in respect to the same property.
(3) (A) If expenditures in respect to an industrial waste treatment
facility, an air pollution control facility, an industrial waste treat-
ment controlled process facility or an air pollution controlled process
facility have been deducted as provided herein and if within ten years
S. 6359 22 A. 8559
from the end of the taxable year in which such deduction was allowed
such property or any part thereof is used for the primary purpose of
salvaging materials which are usable in the manufacturing process or are
marketable, the taxpayer shall report such change of use in its report
for the first taxable year during which it occurs, and the tax commis-
sion may recompute the tax for the year or years for which such
deduction was allowed and any carryback or carryover year, and may
assess any additional tax resulting from such recomputation within the
time fixed by paragraph nine of subsection (c) of section ten hundred
eighty-three of this chapter.
(B) If a deduction is allowed as herein provided for expenditures paid
or incurred during any taxable year on the basis of a temporary certif-
icate of compliance issued pursuant to the environmental conservation
law and if the taxpayer fails to obtain a permanent certificate of
compliance upon completion of the facilities with respect to which such
temporary certificate was issued, the taxpayer shall report such failure
in its report for the taxable year during which such facilities are
completed, and the tax commission may recompute the tax for the year or
years for which such deduction was allowed and any carryback or carry-
over year, and may assess any additional tax resulting from in such
recomputation within the time fixed by paragraph nine of subsection (c)
of section ten hundred eighty-three.
(C) If a deduction is allowed as herein provided for expenditures paid
or incurred during any taxable year in 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 environ-
mental conservation law, the tax commission may recompute the tax for
the year or years for which the facility is not or was not in compliance
with the applicable provisions of the environmental conservation law,
the state sanitary code or codes, rules, regulations, permits or orders
promulgated pursuant thereto, and for which a deduction was allowed, as
well as for any carryback or carryover year to which such deduction was
carried, and may assess any additional tax resulting from such recompu-
tation within the time fixed by paragraph nine of subsection (c) of
section ten hundred eighty-three.
(4) In any taxable year when property is sold or otherwise disposed
of, with respect to which a deduction has been allowed pursuant to this
paragraph, such deduction shall be disregarded in computing gain or
loss, and the gain or loss on the sale or other disposition of such
property shall be the gain or loss entering into the computation of
entire taxable income which the taxpayer is required to report to the
United States treasury department for such taxable year.]
(h) If the period covered by a report under this article is other than
the period covered by the report to the United States treasury depart-
ment,
(1) except as provided in subparagraph two hereof, entire net income
shall be determined by multiplying the taxable income reported to such
department (as adjusted pursuant to the provisions of this article) by
the number of calendar months or major parts thereof covered by the
report under this article and dividing by the number of calendar months
or major parts thereof covered by the report to such department. If it
shall appear that such method of determining entire net income does not
properly reflect the taxpayer's income during the period covered by the
report under this article, the [tax commission] COMMISSIONER shall be
authorized in its discretion to determine such entire net income solely
S. 6359 23 A. 8559
on the basis of the taxpayer's income during the period covered by its
report under this article[;].
(2) [in] IN the case of a New York S termination year, an equal
portion of entire net income shall be assigned to each day of such year.
The portion of such entire net income thereby assigned to the S short
year and the C short year shall be included in the respective reports
for the S short year and the C short year under this article. However,
where paragraph three of subsection (s) of section six hundred twelve of
this chapter applies, the portion of such entire net income assigned to
the S short year and the C short year shall be determined under normal
tax accounting rules.
(i) With respect to a DISC which during any taxable year or reporting
year (1) received more than five percent of its gross sales from the
sale of inventory or other property which it purchased from its stock-
holders, (2) received more than five percent of its gross rentals from
the rental of property which it purchased or rented from its stockhold-
ers or (3) received more than five percent of its total receipts other
than sales and rentals from its stockholders, the following provisions
shall apply.
(A) For any taxable year in which sub-paragraph (B) of this paragraph
is in effect and not rendered invalid, a DISC meeting the above test
shall be exempt from all taxes imposed by this article.
(B) Supplemental to the provisions of subdivision five of section two
hundred eleven of this article, any taxpayer required to compute a tax
under this article, which during the taxable year being reported was a
stockholder in any DISC meeting the test prescribed in this paragraph,
shall for any taxable year ending after December thirty-first, nineteen
hundred seventy-one adjust each item of its receipts, expenses, assets
and liabilities, as otherwise computed under this article, by adding
thereto its attributable share of each such DISC's receipts, expenses,
assets and liabilities as reportable by each such DISC to the United
States Treasury Department for its annual reporting period ending during
the current taxable year of such taxpayer; provided, however, (1) that
all transactions between the taxpayer and each such DISC shall be elimi-
nated from the taxpayer's adjusted receipts, expenses, assets and
liabilities; (2) that the taxpayer's entire net income as otherwise
computed under this section, shall be reduced by subtracting the amount
of the deemed distribution of current income, if any, from each such
DISC already included in the entire net income of such taxpayer by
virtue of having been included in its entire taxable income for that
taxable year as reported to the United States Treasury Department; and
(3) that in the event this paragraph should be rendered invalid, all
DISC's and their stockholders taxable hereunder shall be taxed instead
under the remaining portions of this article.
(j) in the case of property placed in service in taxable years begin-
ning before nineteen hundred ninety-four, for taxable years beginning
after December thirty-first, nineteen hundred eighty-one, except with
respect to property subject to the provisions of section two hundred
eighty-F of the internal revenue code and property subject to the
provisions of section one hundred sixty-eight of the internal revenue
code which is placed in service in this state in taxable years beginning
after December thirty-first, nineteen hundred eighty-four, and provided
a deduction has not been excluded from entire net income pursuant to
subparagraph eight of paragraph (b) of this subdivision, a taxpayer
shall be allowed with respect to property which is subject to the
provisions of section one hundred sixty-eight of the internal revenue
S. 6359 24 A. 8559
code the depreciation deduction allowable under section one hundred
sixty-seven of the internal revenue code as such section would have
applied to property placed in service on December thirty-first, nineteen
hundred eighty. This paragraph shall not apply to property of a taxpayer
principally engaged in the conduct of aviation (other than air freight
forwarders acting as principal and like indirect air carriers) which is
placed in service before taxable years beginning in nineteen hundred
eighty-nine.
(k) QSSS. (1) New York S corporation. In the case of a New York S
corporation which is the parent of a qualified subchapter S subsidiary
(QSSS) with respect to a taxable year:
(A) where the QSSS is not an excluded corporation,
(i) in determining the entire net income of such parent corporation,
all assets, liabilities, income and deductions of the QSSS shall be
treated as assets, liabilities, income and deductions of the parent
corporation, and
(ii) the QSSS shall be exempt from all taxes imposed by this article,
and
(B) where the QSSS is an excluded corporation, the entire net income
of the parent corporation shall be determined as if the federal QSSS
election had not been made.
(2) New York C corporation. In the case of a New York C corporation
which is the parent of a QSSS with respect to a taxable year:
(A) where the QSSS is a taxpayer,
(i) in determining the entire net income of such parent corporation,
all assets, liabilities, income and deductions of the QSSS shall be
treated as assets, liabilities, income and deductions of the parent
corporation, and
(ii) the QSSS shall be exempt from all taxes imposed by this article,
and
(B) where the QSSS is not a taxpayer,
(i) if the QSSS is not an excluded corporation, the parent corporation
may make a QSSS inclusion election to include all assets, liabilities,
income and deductions of the QSSS as assets, liabilities, income and
deductions of the parent corporation, and
(ii) in the absence of such election, or where the QSSS is an excluded
corporation, the entire net income of the parent corporation shall be
determined as if the federal QSSS election had not been made.
(3) Non-New York S corporation not excluded. In the case of an S
corporation which is not a taxpayer and not an excluded corporation, and
which is the parent of a QSSS which is a taxpayer, the shareholders of
the parent corporation shall be entitled to make the New York S election
under subsection (a) of section six hundred sixty of this chapter.
(A) For any taxable year for which such election is in effect, the
parent corporation shall be subject to tax under this article as a New
York S corporation, and the provisions of clause (A) of subparagraph one
of this paragraph shall apply.
(B) For any taxable year for which such election is not in effect, the
QSSS shall be a New York C corporation, and the entire net income of the
QSSS shall be determined as if the federal QSSS election had not been
made. For purposes of such determination, the taxable year of the parent
corporation shall constitute the taxable year of the QSSS, excluding,
however, any portion of such year during which the QSSS is not a taxpay-
er.
(4) S corporation excluded. In the case of an S corporation which is
an excluded corporation and which is the parent of a QSSS which is a
S. 6359 25 A. 8559
taxpayer, the QSSS shall be a New York C corporation and the provisions
of clause (B) of subparagraph three of this paragraph shall apply.
(5) Excluded corporation. The term "excluded corporation" means a
corporation subject to tax under sections one hundred eighty-three
through one hundred eighty-six, inclusive, or article [thirty-two or]
thirty-three of this chapter, or a foreign corporation not taxable by
this state which, if it were taxable, would be subject to tax under any
of such sections or [articles] ARTICLE.
(6) Taxpayer. For purposes of this paragraph, the term "taxpayer"
means a parent corporation or QSSS subject to tax under this article,
determined without regard to the provisions of this paragraph.
(7) QSSS inclusion election. The election under subclause (i) of
clause (B) of subparagraph two of this paragraph shall be effective for
the taxable year for which made and for all succeeding taxable years of
the corporation until such election is terminated. An election or termi-
nation shall be made on such form and in such manner as the commissioner
may prescribe by regulation or instruction.
(l) Emerging technology investment deferral. In the case of any sale
of a qualified emerging technologies investment held for more than thir-
ty-six months and with respect to which the taxpayer elects the applica-
tion of this paragraph, gain from such sale shall be recognized only to
the extent that the amount realized on such sale exceeds the cost of any
qualified emerging technologies investment purchased by the taxpayer
during the three hundred sixty-five-day period beginning on the date of
such sale, reduced by any portion of such cost previously taken into
account under this paragraph. For purposes of this paragraph the follow-
ing shall apply:
(1) A qualified investment is stock of a corporation or an interest,
other than as a creditor, in a partnership or limited liability company
that was acquired by the taxpayer as provided in Internal Revenue Code S
1202(c)(1)(B), except that the reference to the term "stock" in such
section shall be read as "investment," or by the taxpayer from a person
who had acquired such stock or interest in such a manner.
(2) A qualified emerging technology investment is a qualified invest-
ment, that was held by the taxpayer for at least thirty-six months, in a
company defined in paragraph (c) of subdivision one of section thirty-
one hundred two-e of the public authorities law or an investment in a
partnership or limited liability company that is taxed as a partnership
to the extent that such partnership or limited liability company invests
in qualified emerging technology companies.
(3) For purposes of determining whether the nonrecognition of gain
under this subsection applies to a qualified emerging technologies
investment that is sold, the taxpayer's holding period for such invest-
ment and the qualified emerging technologies investment that is
purchased shall be determined without regard to Internal Revenue Code S
1223.
(m) Amounts deferred. The amount deferred under paragraph (l) of this
subdivision shall be added to entire net income when the reinvestment in
the New York qualified emerging technology company which qualified a
taxpayer for such deferral is sold.
[(n) Qualified gas transportation contracts.
(1) Any tax paid under this article allocable to receipts attributable
to a "qualified gas transportation contract" shall be deemed to have
been paid under article nine of this chapter for all purposes of law for
taxable years commencing on or after January first, two thousand,
S. 6359 26 A. 8559
computed as hereinafter provided, if all of the following conditions are
met:
(i) For periods ending prior to January first, two thousand, the
taxpayer paid the franchise tax due under section one hundred eighty-
four of this chapter.
(ii) For the taxable year, all of the receipts from the pipeline
transportation of natural gas attributable to the taxpayer and included
in the taxpayer's entire net income (without regard to this paragraph)
are solely from the transportation of natural gas for wholesale custom-
ers and commercial retail customers.
(iii) The taxpayer's franchise tax liability under this article for
the taxable year (computed without regard to this paragraph) is deter-
mined under paragraph (a) of subdivision one of section two hundred ten
of this article, and such tax liability (without regard to this para-
graph) is greater than the liability the taxpayer would have incurred
under sections one hundred eighty-three and one hundred eighty-four of
this chapter (as such sections existed on December thirty-first, nine-
teen hundred ninety-nine) based on the same taxable period.
(iv) The taxpayer is a party to a "qualified gas transportation
contract," as defined herein.
(2) The provisions of this paragraph shall apply only for the taxable
years during which such qualified gas transportation contract is in full
force and effect, and shall apply only to the receipts of the taxpayer
less any expenses of the taxpayer (but not less than zero), during the
taxable year, to the extent included in entire net income, which are
attributable to any such qualified gas transportation contracts.
Provided, further, in any event, the characterization hereunder shall
expire and be of no further force and effect for taxable years commenc-
ing on or after January first, two thousand fifteen.
(3) The term "qualified gas transportation contract" shall mean a
service agreement for the transportation of natural gas for an end-user
which is a qualified cogeneration facility with a rated capacity of one
thousand megawatts or more, which (i) was entered into before January
first, two thousand, and was in full force and effect and binding on the
parties thereto as of such date, (ii) as originally executed, was for a
term of at least twenty years, and (iii) the terms of which prohibit the
pass-through to such customer of the franchise tax imposed under this
article, while allowing the recovery of the gross earnings tax imposed
under section one hundred eighty-four of this chapter. A contract shall
not qualify as a qualified gas transportation contract if there is: (i)
any renewal or extension of an otherwise qualified gas transportation
contract occurring on or after January first, two thousand, or (ii) any
material amendment to, or supplementation of, an otherwise qualified gas
transportation contract on or after such date. Such renewal, extension,
or material amendment or supplementation shall have the same force and
effect of terminating the characterization hereunder as if the qualify-
ing contract had expired by its own terms.
(o)] (N-1) For taxable years beginning after December thirty-first,
two thousand two, in the case of qualified property described in para-
graph two of subsection k of section 168 of the internal revenue code,
other than qualified resurgence zone property described in paragraph (q)
of this subdivision, and other than qualified New York Liberty Zone
property described in paragraph two of subsection b of section 1400L of
the internal revenue code (without regard to clause (i) of subparagraph
(C) of such paragraph), which was placed in service on or after June
first, two thousand three, a taxpayer shall be allowed with respect to
S. 6359 27 A. 8559
such property the depreciation deduction allowable under section 167 of
the internal revenue code as such section would have applied to such
property had it been acquired by the taxpayer on September tenth, two
thousand one.
(o) Related members expense add back. (1) Definitions. (A) Related
member. "Related member" means a related person as defined in subpara-
graph (c) of paragraph three of subsection (b) of section four hundred
sixty-five of the internal revenue code, except that "fifty percent"
shall be substituted for "ten percent".
(B) Effective rate of tax. "Effective rate of tax" means, as to any
state or U.S. possession, the maximum statutory rate of tax imposed by
the state or possession on or measured by a related member's net income
multiplied by the apportionment percentage, if any, applicable to the
related member under the laws of said jurisdiction. For purposes of this
definition, the effective rate of tax as to any state or U.S. possession
is zero where the related member's net income tax liability in said
jurisdiction is reported on a combined or consolidated return including
both the taxpayer and the related member where the reported transactions
between the taxpayer and the related member are eliminated or offset.
Also, for purposes of this definition, when computing the effective rate
of tax for a jurisdiction in which a related member's net income is
eliminated or offset by a credit or similar adjustment that is dependent
upon the related member either maintaining or managing intangible prop-
erty or collecting interest income in that jurisdiction, the maximum
statutory rate of tax imposed by said jurisdiction shall be decreased to
reflect the statutory rate of tax that applies to the related member as
effectively reduced by such credit or similar adjustment.
(C) Royalty payments. Royalty payments are payments directly connected
to the acquisition, use, maintenance or management, ownership, sale,
exchange, or any other disposition of licenses, trademarks, copyrights,
trade names, trade dress, service marks, mask works, trade secrets,
patents and any other similar types of intangible assets as determined
by the commissioner, and include amounts allowable as interest
deductions under section one hundred sixty-three of the internal revenue
code to the extent such amounts are directly or indirectly for, related
to or in connection with the acquisition, use, maintenance or manage-
ment, ownership, sale, exchange or disposition of such intangible
assets.
(D) Valid Business Purpose. A valid business purpose is one or more
business purposes, other than the avoidance or reduction of taxation,
which alone or in combination constitute the primary motivation for some
business activity or transaction, which activity or transaction changes
in a meaningful way, apart from tax effects, the economic position of
the taxpayer. The economic position of the taxpayer includes an increase
in the market share of the taxpayer, or the entry by the taxpayer into
new business markets.
(2) Royalty expense add backs. (A) Except where a taxpayer is included
in a combined report with a related member pursuant to subdivision four
of section two hundred eleven of this article, for the purpose of
computing entire net income or other applicable taxable basis, a taxpay-
er must add back royalty payments directly or indirectly paid, accrued,
or incurred in connection with one or more direct or indirect trans-
actions with one or more related members during the taxable year to the
extent deductible in calculating federal taxable income.
(B) Exceptions. (i) The adjustment required in this paragraph shall
not apply to the portion of the royalty payment that the taxpayer estab-
S. 6359 28 A. 8559
lishes, by clear and convincing evidence of the type and in the form
specified by the commissioner, meets all of the following requirements:
(I) the related member was subject to tax in this state or another state
or possession of the United States or a foreign nation or some combina-
tion thereof on a tax base that included the royalty payment paid,
accrued or incurred by the taxpayer; (II) the related member during the
same taxable year directly or indirectly paid, accrued or incurred such
portion to a person that is not a related member; and (III) the trans-
action giving rise to the royalty payment between the taxpayer and the
related member was undertaken for a valid business purpose.
(ii) The adjustment required in this paragraph shall not apply if the
taxpayer establishes, by clear and convincing evidence of the type and
in the form specified by the commissioner, that: (I) the related member
was subject to tax on or measured by its net income in this state or
another state or possession of the United States or some combination
thereof; (II) the tax base for said tax included the royalty payment
paid, accrued or incurred by the taxpayer; and (III) the aggregate
effective rate of tax applied to the related member in those jurisdic-
tions is no less than eighty percent of the statutory rate of tax that
applied to the taxpayer under section two hundred ten of this article
for the taxable year.
(iii) [The adjustment required in this paragraph shall not apply if
the taxpayer establishes, by clear and convincing evidence of the type
and in the form specified by the commissioner, that: (I) the royalty
payment was paid, accrued or incurred to a related member organized
under the laws of a country other than the United States; (II) the
related member's income from the transaction was subject to a comprehen-
sive income tax treaty between such country and the United States; (III)
the related member was subject to tax in a foreign nation on a tax base
that included the royalty payment paid, accrued or incurred by the
taxpayer; (IV) the related member's income from the transaction was
taxed in such country at an effective rate of tax at least equal to that
imposed by this state; and (V) the royalty payment was paid, accrued or
incurred pursuant to a transaction that was undertaken for a valid busi-
ness purpose and using terms that reflect an arm's length relationship.
(iv)] The adjustment required in this paragraph shall not apply if the
taxpayer and the commissioner agree in writing to the application or use
of alternative adjustments or computations. The commissioner may, in his
or her discretion, agree to the application or use of alternative
adjustments or computations when he or she concludes that in the absence
of such agreement the income of the taxpayer would not be properly
reflected.
(p) For taxable years beginning after December thirty-first, two thou-
sand two, upon the disposition of property to which paragraph [(o)]
(N-1) of this subdivision applies, the amount of any gain or loss inclu-
dible in entire net income shall be adjusted to reflect the inclusions
and exclusions from entire net income pursuant to subparagraph seventeen
of paragraph (a) and subparagraph seventeen of paragraph (b) of this
subdivision attributable to such property.
(q) For purposes of paragraphs [(o)] (N-1) and (p) of this subdivi-
sion, qualified resurgence zone property shall mean qualified property
described in paragraph two of subsection k of section 168 of the inter-
nal revenue code substantially all of the use of which is in the resur-
gence zone, as defined below, and is in the active conduct of a trade or
business by the taxpayer in such zone, and the original use of which in
the resurgence zone commences with the taxpayer after December thirty-
S. 6359 29 A. 8559
first, two thousand two. The resurgence zone shall mean the area of New
York county bounded on the south by a line running from the intersection
of the Hudson River with the Holland Tunnel, and running thence east to
Canal Street, then running along the centerline of Canal Street to the
intersection of the Bowery and Canal Street, running thence in a south-
easterly direction diagonally across Manhattan Bridge Plaza, to the
Manhattan Bridge and thence along the centerline of the Manhattan Bridge
to the point where the centerline of the Manhattan Bridge would inter-
sect with the easterly bank of the East River, and bounded on the north
by a line running from the intersection of the Hudson River with the
Holland Tunnel and running thence north along West Avenue to the inter-
section of Clarkson Street then running east along the centerline of
Clarkson Street to the intersection of Washington Avenue, then running
south along the centerline of Washington Avenue to the intersection of
West Houston Street, then east along the centerline of West Houston
Street, then at the intersection of the Avenue of the Americas continu-
ing east along the centerline of East Houston Street to the easterly
bank of the East River.
(R) SUBTRACTION MODIFICATION FOR QUALIFIED RESIDENTIAL LOAN PORTFO-
LIOS. (1)(A) A TAXPAYER THAT IS EITHER A THRIFT INSTITUTION AS DEFINED
IN SUBPARAGRAPH THREE OF THIS PARAGRAPH OR A QUALIFIED COMMUNITY BANK AS
DEFINED IN SUBPARAGRAPH TWO OF PARAGRAPH (S) OF THIS SUBDIVISION AND
MAINTAINS A QUALIFIED RESIDENTIAL LOAN PORTFOLIO AS DEFINED IN SUBPARA-
GRAPH TWO OF THIS PARAGRAPH SHALL BE ALLOWED AS A DEDUCTION IN COMPUTING
ENTIRE NET INCOME THE AMOUNT, IF ANY, BY WHICH (I) THIRTY-TWO PERCENT OF
ITS ENTIRE NET INCOME DETERMINED WITHOUT REGARD TO THIS PARAGRAPH
EXCEEDS (II) THE AMOUNTS DEDUCTED BY THE TAXPAYER PURSUANT TO SECTIONS
166 AND 585 OF THE INTERNAL REVENUE CODE LESS ANY AMOUNTS INCLUDED IN
FEDERAL TAXABLE INCOME AS A RESULT OF A RECOVERY OF A LOAN.
(B)(I) IF THE TAXPAYER IS IN A COMBINED REPORT, THIS DEDUCTION WILL BE
COMPUTED ON A COMBINED BASIS. IN THAT INSTANCE, THE ENTIRE NET INCOME OF
THE COMBINED GROUP FOR PURPOSES OF THIS PARAGRAPH SHALL BE MULTIPLIED BY
A FRACTION, THE NUMERATOR OF WHICH IS THE AVERAGE TOTAL ASSETS OF ALL
THE THRIFT INSTITUTIONS OR QUALIFIED COMMUNITY BANKS INCLUDED IN THE
COMBINED REPORT AND THE DENOMINATOR OF WHICH IS THE AVERAGE TOTAL ASSETS
OF ALL THE CORPORATIONS INCLUDED IN THE COMBINED REPORT.
(II) MEASUREMENT OF ASSETS FOR PURPOSES OF THIS CLAUSE. (I) TOTAL
ASSETS ARE THOSE ASSETS THAT ARE PROPERLY REFLECTED ON A BALANCE SHEET,
COMPUTED IN THE SAME MANNER AS IS REQUIRED BY THE BANKING REGULATOR OF
THE TAXPAYERS INCLUDED IN THE COMBINED RETURN.
(II) ASSETS WILL ONLY BE INCLUDED IF THE INCOME OR EXPENSES OF WHICH
ARE PROPERLY REFLECTED (OR WOULD HAVE BEEN PROPERLY REFLECTED IF NOT
FULLY DEPRECIATED OR EXPENSED, OR DEPRECIATED OR EXPENSED TO A NOMINAL
AMOUNT) IN THE COMPUTATION OF THE COMBINED GROUP'S ENTIRE NET INCOME FOR
THE TAXABLE YEAR. ASSETS WILL NOT INCLUDE DEFERRED TAX ASSETS AND INTAN-
GIBLE ASSETS IDENTIFIED AS "GOODWILL".
(III) TANGIBLE REAL AND PERSONAL PROPERTY, SUCH AS BUILDINGS, LAND,
MACHINERY, AND EQUIPMENT SHALL BE VALUED AT COST. INTANGIBLE PROPERTY,
SUCH AS LOANS AND INVESTMENTS, SHALL BE VALUED AT BOOK VALUE.
(IV) INTERCORPORATE STOCKHOLDINGS AND BILLS, NOTES AND ACCOUNTS
RECEIVABLE, AND OTHER INTERCORPORATE INDEBTEDNESS BETWEEN THE CORPO-
RATIONS INCLUDED IN THE COMBINED REPORT SHALL BE ELIMINATED.
(V) AVERAGE ASSETS ARE COMPUTED USING THE ASSETS MEASURED ON THE FIRST
DAY OF THE TAXABLE YEAR, AND ON THE LAST DAY OF EACH SUBSEQUENT QUARTER
OF THE TAXABLE YEAR.
S. 6359 30 A. 8559
(2) QUALIFIED RESIDENTIAL LOAN PORTFOLIO. (A) A TAXPAYER MAINTAINS A
QUALIFIED RESIDENTIAL LOAN PORTFOLIO IF AT LEAST SIXTY PERCENT OF THE
AMOUNT OF THE TOTAL ASSETS AT THE CLOSE OF THE TAXABLE YEAR OF THE
THRIFT INSTITUTION OR QUALIFIED COMMUNITY BANK CONSISTS OF THE ASSETS
DESCRIBED IN ITEMS (I) THROUGH (XII) OF THIS CLAUSE, WITH THE APPLICA-
TION OF THE RULE IN ITEM (XIII). IF THE TAXPAYER IS A MEMBER OF A
COMBINED GROUP, THE DETERMINATION OF WHETHER THERE IS A QUALIFIED RESI-
DENTIAL LOAN PORTFOLIO WILL BE MADE BY AGGREGATING THE ASSETS OF THE
THRIFT INSTITUTIONS OR QUALIFIED COMMUNITY BANKS THAT ARE MEMBERS OF THE
COMBINED GROUP.
ASSETS:
(I) CASH;
(II) OBLIGATIONS OF THE UNITED STATES OR OF A STATE OR POLITICAL
SUBDIVISION THEREOF, AND STOCK OR OBLIGATIONS OF A CORPORATION WHICH IS
AN INSTRUMENTALITY OR A GOVERNMENT SPONSORED ENTERPRISE OF THE UNITED
STATES OR OF A STATE OR POLITICAL SUBDIVISION THEREOF;
(III) LOANS SECURED BY A DEPOSIT OR SHARE OF A MEMBER;
(IV) LOANS SECURED BY AN INTEREST IN REAL PROPERTY WHICH IS (OR FROM
THE PROCEEDS OF THE LOAN, WILL BECOME) RESIDENTIAL REAL PROPERTY OR REAL
PROPERTY USED PRIMARILY FOR CHURCH PURPOSES, LOANS MADE FOR THE IMPROVE-
MENT OF RESIDENTIAL REAL PROPERTY OR REAL PROPERTY USED PRIMARILY FOR
CHURCH PURPOSES, PROVIDED THAT FOR PURPOSES OF THIS ITEM, RESIDENTIAL
REAL PROPERTY SHALL INCLUDE SINGLE OR MULTI-FAMILY DWELLINGS, FACILITIES
IN RESIDENTIAL DEVELOPMENTS DEDICATED TO PUBLIC USE OR PROPERTY USED ON
A NONPROFIT BASIS FOR RESIDENTS, AND MOBILE HOMES NOT USED ON A TRAN-
SIENT BASIS;
(V) PROPERTY ACQUIRED THROUGH THE LIQUIDATION OF DEFAULTED LOANS
DESCRIBED IN ITEM (IV) OF THIS CLAUSE;
(VI) ANY REGULAR OR RESIDUAL INTEREST IN A REMIC, AS SUCH TERM IS
DEFINED IN SECTION 860D OF THE INTERNAL REVENUE CODE, BUT ONLY IN THE
PROPORTION WHICH THE ASSETS OF SUCH REMIC CONSIST OF PROPERTY DESCRIBED
IN ANY OF THE PRECEDING ITEMS OF THIS CLAUSE, EXCEPT THAT IF NINETY-FIVE
PERCENT OR MORE OF THE ASSETS OF SUCH REMIC ARE ASSETS DESCRIBED IN
ITEMS (I) THROUGH (V) OF THIS CLAUSE, THE ENTIRE INTEREST IN THE REMIC
SHALL QUALIFY;
(VII) ANY MORTGAGE-BACKED SECURITY WHICH REPRESENTS OWNERSHIP OF A
FRACTIONAL UNDIVIDED INTEREST IN A TRUST, THE ASSETS OF WHICH CONSIST
PRIMARILY OF MORTGAGE LOANS, PROVIDED THAT THE REAL PROPERTY WHICH
SERVES AS SECURITY FOR THE LOANS IS (OR FROM THE PROCEEDS OF THE LOAN,
WILL BECOME) THE TYPE OF PROPERTY DESCRIBED IN ITEM (IV) OF THIS CLAUSE
AND ANY COLLATERALIZED MORTGAGE OBLIGATION, THE SECURITY FOR WHICH
CONSISTS PRIMARILY OF MORTGAGE LOANS THAT MAINTAIN AS SECURITY THE TYPE
OF PROPERTY DESCRIBED IN ITEM (IV) OF THIS CLAUSE;
(VIII) CERTIFICATES OF DEPOSIT IN, OR OBLIGATIONS OF, A CORPORATION
ORGANIZED UNDER A STATE LAW WHICH SPECIFICALLY AUTHORIZES SUCH CORPO-
RATION TO INSURE THE DEPOSITS OR SHARE ACCOUNTS OF MEMBER ASSOCIATIONS;
(IX) LOANS SECURED BY AN INTEREST IN EDUCATIONAL, HEALTH, OR WELFARE
INSTITUTIONS OR FACILITIES, INCLUDING STRUCTURES DESIGNED OR USED PRIMA-
RILY FOR RESIDENTIAL PURPOSES FOR STUDENTS, RESIDENTS, AND PERSONS UNDER
CARE, EMPLOYEES, OR MEMBERS OF THE STAFF OF SUCH INSTITUTIONS OR FACILI-
TIES;
(X) LOANS MADE FOR THE PAYMENT OF EXPENSES OF COLLEGE OR UNIVERSITY
EDUCATION OR VOCATIONAL TRAINING;
(XI) PROPERTY USED BY THE TAXPAYER IN SUPPORT OF BUSINESS WHICH
CONSISTS PRINCIPALLY OF ACQUIRING THE SAVINGS OF THE PUBLIC AND INVEST-
ING IN LOANS; AND
S. 6359 31 A. 8559
(XII) LOANS FOR WHICH THE TAXPAYER IS THE CREDITOR AND WHICH ARE WHOL-
LY SECURED BY LOANS DESCRIBED IN ITEM (IV) OF THIS CLAUSE.
(XIII) THE VALUE OF ACCRUED INTEREST RECEIVABLE AND ANY LOSS-SHARING
COMMITMENT OR OTHER LOAN GUARANTY BY A GOVERNMENTAL AGENCY WILL BE
CONSIDERED PART OF THE BASIS IN THE LOANS TO WHICH THE ACCRUED INTEREST
OR LOSS PROTECTION APPLIES.
(B) AT THE ELECTION OF THE TAXPAYER, THE PERCENTAGE SPECIFIED IN
CLAUSE (A) OF THIS SUBPARAGRAPH SHALL BE APPLIED ON THE BASIS OF THE
AVERAGE ASSETS OUTSTANDING DURING THE TAXABLE YEAR, IN LIEU OF THE CLOSE
OF THE TAXABLE YEAR. THE TAXPAYER CAN ELECT TO COMPUTE AN AVERAGE USING
THE ASSETS MEASURED ON THE FIRST DAY OF THE TAXABLE YEAR AND ON THE LAST
DAY OF EACH SUBSEQUENT QUARTER, OR MONTH OR DAY DURING THE TAXABLE YEAR.
THIS ELECTION MAY BE MADE ANNUALLY.
(C) FOR PURPOSES OF THIS COMPUTATION, THE DEFINITION OF ASSETS IN
CLAUSE (B) OF SUBPARAGRAPH ONE OF THIS PARAGRAPH APPLIES.
(D) FOR PURPOSES OF ITEM (IV) OF CLAUSE (A) OF THIS SUBPARAGRAPH, IF A
MULTIFAMILY STRUCTURE SECURING A LOAN IS USED IN PART FOR NONRESIDENTIAL
USE PURPOSES, THE ENTIRE LOAN IS DEEMED A RESIDENTIAL REAL PROPERTY LOAN
IF THE PLANNED RESIDENTIAL USE EXCEEDS EIGHTY PERCENT OF THE PROPERTY'S
PLANNED USE (MEASURED, AT THE TAXPAYER'S ELECTION, BY USING SQUARE
FOOTAGE OR GROSS RENTAL REVENUE, AND DETERMINED AS OF THE TIME THE LOAN
IS MADE).
(E) FOR PURPOSES OF ITEM (IV) OF CLAUSE (A) OF THIS SUBPARAGRAPH,
LOANS MADE TO FINANCE THE ACQUISITION OR DEVELOPMENT OF LAND SHALL BE
DEEMED TO BE LOANS SECURED BY AN INTEREST IN RESIDENTIAL REAL PROPERTY
IF THERE IS A REASONABLE ASSURANCE THAT THE PROPERTY WILL BECOME RESI-
DENTIAL REAL PROPERTY WITHIN A PERIOD OF THREE YEARS FROM THE DATE OF
ACQUISITION OF SUCH LAND; BUT THIS SENTENCE SHALL NOT APPLY FOR ANY
TAXABLE YEAR UNLESS, WITHIN SUCH THREE YEAR PERIOD, SUCH LAND BECOMES
RESIDENTIAL REAL PROPERTY. FOR PURPOSES OF DETERMINING WHETHER ANY
INTEREST IN A REMIC QUALIFIES UNDER ITEM (VI) OF CLAUSE (A) OF THIS
SUBPARAGRAPH, ANY REGULAR INTEREST IN ANOTHER REMIC HELD BY SUCH REMIC
SHALL BE TREATED AS A LOAN DESCRIBED IN A PRECEDING ITEM UNDER PRINCI-
PLES SIMILAR TO THE PRINCIPLE OF SUCH ITEM (VI), EXCEPT THAT IS SUCH
REMICS ARE PART OF A TIERED STRUCTURE, THEY SHALL BE TREATED AS ONE
REMIC FOR PURPOSES OF SUCH ITEM (VI).
(3) FOR PURPOSES OF THIS PARAGRAPH, A "THRIFT INSTITUTION" IS A
SAVINGS BANK, A SAVINGS AND LOAN ASSOCIATION, OR OTHER SAVINGS INSTITU-
TION CHARTERED AND SUPERVISED AS SUCH UNDER FEDERAL OR STATE LAW.
(S) SUBTRACTION MODIFICATION FOR COMMUNITY BANKS. (1) A TAXPAYER THAT
IS A QUALIFIED COMMUNITY BANK AS DEFINED IN SUBPARAGRAPH TWO OF THIS
PARAGRAPH OR A THRIFT INSTITUTION AS DEFINED IN SUBPARAGRAPH THREE OF
PARAGRAPH (R) OF THIS SUBDIVISION SHALL BE ALLOWED A DEDUCTION IN
COMPUTING ENTIRE NET INCOME EQUAL TO THE AMOUNT COMPUTED UNDER SUBPARA-
GRAPH THREE OF THIS PARAGRAPH.
(2) TO BE A QUALIFIED COMMUNITY BANK, A TAXPAYER MUST SATISFY THE
FOLLOWING CONDITIONS.
(A) IT IS A BANK OR TRUST COMPANY ORGANIZED UNDER OR SUBJECT TO THE
PROVISIONS OF ARTICLE THREE OF THE BANKING LAW OR A COMPARABLE PROVISION
OF THE LAWS OF ANOTHER STATE, OR A NATIONAL BANKING ASSOCIATION.
(B) THE AVERAGE VALUE DURING THE TAXABLE YEAR OF THE ASSETS OF THE
TAXPAYER, OR THE ASSETS OF THE AFFILIATED GROUP OF THE TAXPAYER, MUST
NOT EXCEED EIGHT BILLION DOLLARS. FOR PURPOSES OF THIS CLAUSE, THE
AFFILIATED GROUP OF THE TAXPAYER INCLUDES ANY CORPORATION THAT MEETS THE
OWNERSHIP REQUIREMENTS TO BE INCLUDED IN A COMBINED REPORT SPECIFIED IN
S. 6359 32 A. 8559
PARAGRAPH (A) OF SUBDIVISION TWO OF SECTION TWO HUNDRED TEN-C OF THIS
ARTICLE.
(3)(A) THE SUBTRACTION MODIFICATION SHALL BE COMPUTED AS FOLLOWS:
(I) MULTIPLY THE TAXPAYER'S NET INTEREST INCOME FROM LOANS DURING THE
TAXABLE YEAR BY A FRACTION, THE NUMERATOR OF WHICH IS THE GROSS INTEREST
INCOME DURING THE TAXABLE YEAR FROM QUALIFYING LOANS AND THE DENOMINATOR
OF WHICH IS THE GROSS INTEREST INCOME DURING THE TAXABLE YEAR FROM ALL
LOANS.
(II) MULTIPLY THE AMOUNT DETERMINED IN CLAUSE (I) BY FORTY PERCENT.
THIS PRODUCT IS THE AMOUNT OF THE DEDUCTION ALLOWED UNDER THIS PARA-
GRAPH.
(B)(I) NET INTEREST INCOME FROM LOANS SHALL MEAN GROSS INTEREST INCOME
FROM LOANS LESS GROSS INTEREST EXPENSE FROM LOANS. GROSS INTEREST
EXPENSE FROM LOANS IS DETERMINED BY MULTIPLYING GROSS INTEREST EXPENSE
BY A FRACTION, THE NUMERATOR OF WHICH IS THE AVERAGE TOTAL VALUE OF
LOANS OWNED BY THE THRIFT INSTITUTION OR COMMUNITY BANK DURING THE TAXA-
BLE YEAR AND THE DENOMINATOR OF WHICH IS THE AVERAGE TOTAL ASSETS OF THE
THRIFT INSTITUTION OR COMMUNITY BANK DURING THE TAXABLE YEAR.
(II) MEASUREMENT OF ASSETS FOR PURPOSES OF THIS CLAUSE. (I) TOTAL
ASSETS ARE THOSE ASSETS THAT ARE PROPERLY REFLECTED ON A BALANCE SHEET,
COMPUTED IN THE SAME MANNER AS IS REQUIRED BY THE BANKING REGULATOR OF
THE TAXPAYERS INCLUDED IN THE COMBINED RETURN.
(II) ASSETS WILL ONLY BE INCLUDED IF THE INCOME OR EXPENSES OF WHICH
ARE PROPERLY REFLECTED (OR WOULD HAVE BEEN PROPERLY REFLECTED IF NOT
FULLY DEPRECIATED OR EXPENSED, OR DEPRECIATED OR EXPENSED TO A NOMINAL
AMOUNT) IN THE COMPUTATION OF THE TAXPAYER'S ENTIRE NET INCOME FOR THE
TAXABLE YEAR. ASSETS WILL NOT INCLUDE DEFERRED TAX ASSETS AND INTANGIBLE
ASSETS IDENTIFIED AS "GOODWILL".
(III) TANGIBLE REAL AND PERSONAL PROPERTY, SUCH AS BUILDINGS, LAND,
MACHINERY, AND EQUIPMENT SHALL BE VALUED AT COST. INTANGIBLE PROPERTY,
SUCH AS LOANS AND INVESTMENTS, SHALL BE VALUED AT BOOK VALUE.
(IV) AVERAGE ASSETS ARE COMPUTED USING THE ASSETS MEASURED ON THE
FIRST DAY OF THE TAXABLE YEAR, AND ON THE LAST DAY OF EACH SUBSEQUENT
QUARTER OF THE TAXABLE YEAR.
(C) A QUALIFYING LOAN IS A LOAN THAT MEETS THE CONDITIONS SPECIFIED IN
SUBCLAUSE (I) OF THIS CLAUSE AND SUBCLAUSE (II) OF THIS CLAUSE.
(I) THE LOAN IS ORIGINATED OR PURCHASED BY THE QUALIFIED COMMUNITY
BANK OR THRIFT INSTITUTION IMMEDIATELY AFTER ITS ORIGINATION IN
CONNECTION WITH A COMMITMENT TO PURCHASE MADE BY THE BANK PRIOR TO THE
LOAN'S ORIGINATION.
(II) THE LOAN IS A SMALL BUSINESS LOAN, THE PRINCIPAL AMOUNT OF THE
LOAN IS ONE MILLION DOLLARS OR LESS, WHERE EITHER THE BORROWER IS
LOCATED IN THIS STATE AS DETERMINED UNDER SECTION TWO HUNDRED TEN-A OF
THIS ARTICLE AND THE LOAN IS NOT SECURED BY REAL PROPERTY LOCATED IN NEW
YORK, OR THE LOAN IS SECURED BY REAL PROPERTY LOCATED IN NEW YORK.
10. The term "calendar year" means a period of twelve calendar months
(or any shorter period beginning on the date the taxpayer becomes
subject to the tax imposed by this article) ending on the thirty-first
day of December, provided the taxpayer keeps its books on the basis of
such period or on the basis of any period ending on any day other than
the last day of a calendar month, or provided the taxpayer does not keep
books, and includes, in case the taxpayer changes the period on the
basis of which it keeps its books from a fiscal year to a calendar year,
the period from the close of its last old fiscal year up to and includ-
ing the following December thirty-first. The term "fiscal year" means a
period of twelve calendar months (or any shorter period beginning on the
S. 6359 33 A. 8559
date the taxpayer becomes subject to the tax imposed by this article)
ending on the last day of any month other than December, provided the
taxpayer keeps its books on the basis of such period, and includes, in
case the taxpayer changes the period on the basis of which it keeps it
books from a calendar year to a fiscal year or from one fiscal year to
another fiscal year, the period from the close of its last old calendar
or fiscal year up to the date designated as the close of its new fiscal
year.
11. The term "tangible personal property" means corporeal personal
property, such as machinery, tools, implements, goods, wares and
merchandise, and does not mean money, deposits in banks, shares of
stock, bonds, notes, credits or evidences of an interest in property and
evidences of debt.
12. The term elected or appointed officer shall include the chairman,
president, vice-president, secretary, assistant secretary, treasurer,
assistant treasurer, comptroller, and also any other officer, irrespec-
tive of his title, who is charged with and performs any of the regular
functions of any such officer, unless the total compensation of such
officer is derived exclusively from the receipt of commissions. A direc-
tor shall be considered an elected or appointed officer only if he
performs duties ordinarily performed by an officer.
13. The term "manufacturer" means a taxpayer or, in the case of a
combined report, a combined group, that, during the taxable year, is
principally engaged in manufacturing. A taxpayer or a combined group is
principally engaged in manufacturing if more than fifty percent of the
gross receipts of the taxpayer or the combined group, respectively,
during the taxable year are derived from the sale of goods produced by
manufacturing. In computing a combined group's gross receipts, intercor-
porate receipts shall be eliminated. In computing gross receipts for a
taxpayer that is a partner in partnership, inter-entity receipts between
the taxpayer and such partnership shall be eliminated.
14. (a) The term "manufacturing" means 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.
(b) Notwithstanding the definition of manufacturing in paragraph (a)
of this subdivision:
(i) The generation and distribution of electricity, the extraction and
distribution of natural gas, and the production of steam associated with
the generation of electricity does not constitute manufacturing.
(ii) The creation, production or reproduction of a film, television
show or commercial does not constitute manufacturing.
(iii) The blending of two or more fuels does not constitute manufac-
turing.
(iv) The mass production of food products for wholesale commercial
distribution and sale constitutes manufacturing.
15. The term "qualified New York manufacturer" means a manufacturer
that has property in the state that is used in manufacturing and either
the fair market value of that property at the close of the taxable year
is at least ten million dollars or all of its real and personal property
is located in New York. A taxpayer or, in the case of a combined report,
a combined group, that does not satisfy the criteria in subdivision
thirteen of this section may be a qualified New York manufacturer if the
taxpayer or the combined group employs during the taxable year at least
two thousand five hundred employees in manufacturing in New York and the
S. 6359 34 A. 8559
taxpayer or the combined group has property in the state used in manu-
facturing, the adjusted basis of which for federal income tax purposes
at the close of the taxable year is at least one hundred million
dollars.
[19. The term "fulfillment services" shall mean any of the following
services performed by an entity on its premises on behalf of a purchas-
er:
(a) the acceptance of orders electronically or by mail, telephone,
telefax or internet;
(b) responses to consumer correspondence or inquiries electronically
or by mail, telephone, telefax or internet;
(c) billing and collection activities; or
(d) the shipment of orders from an inventory of products offered for
sale by the purchaser.]
S 5. Subdivisions 1, 2, 4, 5, 6, 7 and 8 of section 209 of the tax
law, subdivisions 1 and 6 as amended by chapter 817 of the laws of 1987,
subdivision 2 as amended by chapter 75 of the laws of 1998, subdivision
4 as amended by section 27 of LBD number 74024-03-4, subdivisions 5 and
7 as amended by section 2 of part FF-1 of chapter 57 of the laws of
2008, and subdivision 8 as added by section 1 of part O of chapter 61 of
the laws of 2006, are amended to read as follows:
1. (A) For the privilege of exercising its corporate franchise, or of
doing business, or of employing capital, or of owning or leasing proper-
ty in this state in a corporate or organized capacity, or of maintaining
an office in this state, OR OF DERIVING RECEIPTS FROM ACTIVITY IN THIS
STATE, for all or any part of each of its fiscal or calendar years,
every domestic or foreign corporation, except corporations specified in
subdivision four of this section, shall annually pay a franchise tax,
upon the basis of its [entire net] BUSINESS income base, or upon such
other basis as may be applicable as hereinafter provided, for such
fiscal or calendar year or part thereof, on a report which shall be
filed, except as hereinafter provided, on or before the fifteenth day of
March next succeeding the close of each such year, or, in the case of a
corporation which reports on the basis of a fiscal year, within two and
one-half months after the close of such fiscal year, and shall be paid
as hereinafter provided.
(B) A CORPORATION IS DERIVING RECEIPTS FROM ACTIVITY IN THIS STATE IF
IT HAS RECEIPTS WITHIN THIS STATE OF ONE MILLION DOLLARS OR MORE IN THE
TAXABLE YEAR. FOR PURPOSES OF THIS SECTION, THE TERM "RECEIPTS" MEANS
THE RECEIPTS THAT ARE SUBJECT TO THE APPORTIONMENT RULES SET FORTH IN
SECTION TWO HUNDRED TEN-A OF THIS ARTICLE, AND THE TERM "RECEIPTS WITHIN
THIS STATE" MEANS THE RECEIPTS INCLUDED IN THE NUMERATOR OF THE APPOR-
TIONMENT FACTOR DETERMINED UNDER SECTION TWO HUNDRED TEN-A OF THIS ARTI-
CLE.
(C) A CORPORATION IS DOING BUSINESS IN THIS STATE IF (I) IT HAS ISSUED
CREDIT CARDS TO ONE THOUSAND OR MORE CUSTOMERS WHO HAVE A MAILING
ADDRESS WITHIN THIS STATE AS OF THE LAST DAY OF ITS TAXABLE YEAR, (II)
IT HAS MERCHANT CUSTOMER CONTRACTS WITH MERCHANTS AND THE TOTAL NUMBER
OF LOCATIONS COVERED BY THOSE CONTRACTS EQUALS ONE THOUSAND OR MORE
LOCATIONS IN THIS STATE TO WHOM THE CORPORATION REMITTED PAYMENTS FOR
CREDIT CARD TRANSACTIONS DURING THE TAXABLE YEAR, OR (III) THE SUM OF
THE NUMBER OF CUSTOMERS DESCRIBED IN SUBPARAGRAPH (I) OF THIS PARAGRAPH
PLUS THE NUMBER OF LOCATIONS COVERED BY ITS CONTRACTS DESCRIBED IN
SUBPARAGRAPH (II) OF THIS PARAGRAPH EQUALS ONE THOUSAND OR MORE. FOR
PURPOSES OF THIS PARAGRAPH, RECEIPTS FROM PROCESSING CREDIT CARD TRANS-
ACTIONS FOR MERCHANTS INCLUDE MERCHANT DISCOUNT FEES RECEIVED BY THE
S. 6359 35 A. 8559
CORPORATION. AS USED IN THIS PARAGRAPH, THE TERM "CREDIT CARD" INCLUDES
BANK, CREDIT, TRAVEL AND ENTERTAINMENT CARDS.
(D)(I) A CORPORATION WITH LESS THAN ONE MILLION DOLLARS BUT AT LEAST
TEN THOUSAND DOLLARS OF RECEIPTS WITHIN THIS STATE IN A TAXABLE YEAR
THAT IS PART OF A COMBINED REPORTING GROUP IS DERIVING RECEIPTS FROM
ACTIVITY IN THIS STATE IF THE RECEIPTS WITHIN THIS STATE OF THE MEMBERS
OF THE COMBINED REPORTING GROUP THAT HAVE AT LEAST TEN THOUSAND DOLLARS
OF RECEIPTS WITHIN THIS STATE IN THE AGGREGATE MEET THE THRESHOLD SET
FORTH IN PARAGRAPH (B) OF THIS SUBDIVISION.
(II) A CORPORATION THAT DOES NOT MEET ANY OF THE THRESHOLDS SET FORTH
IN PARAGRAPH (C) OF THIS SUBDIVISION BUT HAS AT LEAST TEN CUSTOMERS, OR
LOCATIONS, OR CUSTOMERS AND LOCATIONS, AS DESCRIBED IN PARAGRAPH (C) OF
THIS SUBDIVISION, AND IS PART OF A COMBINED REPORTING GROUP IS DOING
BUSINESS IN THIS STATE IF THE NUMBER OF CUSTOMERS, LOCATIONS, OR CUSTOM-
ERS AND LOCATIONS, WITHIN THIS STATE OF THE MEMBERS OF THE COMBINED
REPORTING GROUP THAT HAVE AT LEAST TEN CUSTOMERS, LOCATIONS, OR CUSTOM-
ERS AND LOCATIONS, WITHIN THIS STATE IN THE AGGREGATE MEETS ANY OF THE
THRESHOLDS SET FORTH IN PARAGRAPH (C) OF THIS SUBDIVISION.
(E) AT THE END OF EACH YEAR, THE COMMISSIONER SHALL REVIEW THE CUMULA-
TIVE PERCENTAGE CHANGE IN THE CONSUMER PRICE INDEX. THE COMMISSIONER
SHALL ADJUST THE RECEIPT THRESHOLDS SET FORTH IN THIS SUBDIVISION IF THE
CONSUMER PRICE INDEX HAS CHANGED BY TEN PERCENT OR MORE SINCE JANUARY
FIRST, TWO THOUSAND FIFTEEN, OR SINCE THE DATE THAT THE THRESHOLDS WERE
LAST ADJUSTED UNDER THIS SUBDIVISION. THE THRESHOLDS SHALL BE ADJUSTED
TO REFLECT THAT CUMULATIVE PERCENTAGE CHANGE IN THE CONSUMER PRICE
INDEX. THE ADJUSTED THRESHOLDS SHALL BE ROUNDED TO THE NEAREST ONE THOU-
SAND DOLLARS. AS USED IN THIS PARAGRAPH, "CONSUMER PRICE INDEX" MEANS
THE CONSUMER PRICE INDEX FOR ALL URBAN CONSUMERS (CPI-U) AVAILABLE FORM
THE BUREAU OF LABOR STATISTICS OF THE UNITED STATES DEPARTMENT OF LABOR.
ANY ADJUSTMENT SHALL APPLY TO TAX PERIODS THAT BEGIN AFTER THE ADJUST-
MENT IS MADE.
2. A foreign corporation shall not be deemed to be doing business,
employing capital, owning or leasing property, or maintaining an office
in this state, OR DERIVING RECEIPTS FROM ACTIVITY IN THIS STATE, for the
purposes of this article, by reason of (a) the maintenance of cash
balances with banks or trust companies in this state, or (b) the owner-
ship of shares of stock or securities kept in this state, if kept in a
safe deposit box, safe, vault or other receptacle rented for the
purpose, or if pledged as collateral security, or if deposited with one
or more banks or trust companies, or brokers who are members of a recog-
nized security exchange, in safekeeping or custody accounts, or (c) the
taking of any action by any such bank or trust company or broker, which
is incidental to the rendering of safekeeping or custodian service to
such corporation, or (d) the maintenance of an office in this state by
one or more officers or directors of the corporation who are not employ-
ees of the corporation if the corporation otherwise is not doing busi-
ness in this state, and does not employ capital or own or lease property
in this state, or (e) the keeping of books or records of a corporation
in this state if such books or records are not kept by employees of such
corporation and such corporation does not otherwise do business, employ
capital, own or lease property or maintain an office in this state, or
(f) [the use of fulfillment services of a person other than an affil-
iated person and the ownership of property stored on the premises of
such person in conjunction with such services, or (g)] any combination
of the foregoing activities. [For purposes of this subdivision, persons
are affiliated persons with respect to each other where one of such
S. 6359 36 A. 8559
persons has an ownership interest of more than five percent, whether
direct or indirect, in the other, or where an ownership interest of more
than five percent, whether direct or indirect, is held in each of such
persons by another person or by a group of other persons which are
affiliated persons with respect to each other. The term "person" in the
preceding sentence and in paragraph (f) of this subdivision shall have
the meaning ascribed thereto by subdivision (a) of section eleven
hundred one of this chapter.]
4. Corporations liable to tax under sections one hundred eighty-three
to one hundred eighty-four-a, inclusive, corporations taxable under
[articles thirty-two and] ARTICLE thirty-three of this chapter, any
trust company organized under a law of this state all of the stock of
which is owned by not less than twenty savings banks organized under a
law of this state, [bank holding companies filing a combined return in
accordance with subsection (f) of section fourteen hundred sixty-two of
this chapter,] a captive REIT or a captive RIC filing a combined return
under [either subsection (f) of section fourteen hundred sixty-two or]
subdivision (f) of section fifteen hundred fifteen of this chapter, and
housing companies organized and operating pursuant to the provisions of
article two or article five of the private housing finance law and hous-
ing development fund companies organized pursuant to the provisions of
article eleven of the private housing finance law shall not be subject
to tax under this article.
5. For any taxable year of a real estate investment trust as defined
in section eight hundred fifty-six of the internal revenue code in which
such trust is subject to federal income taxation under section eight
hundred fifty-seven of such code, such trust shall be subject to a tax
computed under either paragraph (a) [, (c)] or (d) of subdivision one of
section two hundred ten of this chapter, whichever is [greatest]
GREATER, and shall not be subject to any tax under article [thirty-two
or article] thirty-three of this chapter except for a captive REIT
required to file a combined return under [subdivision (f) of section
fourteen hundred sixty-two or] subdivision (f) of section fifteen
hundred fifteen of this chapter. In the case of such a real estate
investment trust, including a captive REIT as defined in section two of
this chapter, the term "entire net income" means "real estate investment
trust taxable income" as defined in paragraph two of subdivision (b) of
section eight hundred fifty-seven (as modified by section eight hundred
fifty-eight) of the internal revenue code plus the amount taxable under
paragraph three of subdivision (b) of section eight hundred fifty-seven
of such code, subject to the [modification] MODIFICATIONS required by
subdivision nine of section two hundred eight of this article [(other
than the modification required by subparagraph two of paragraph (a)
thereof) including the modifications required by paragraphs (d) and (e)
of subdivision three of section two hundred ten of this article].
6. For any taxable year of a DISC, not exempt from tax under paragraph
(i) of subdivision nine of section two hundred eight of this article,
the taxes imposed by subdivision one of this section shall be computed
only under either paragraph (b) or (d) of subdivision one of section two
hundred ten of this chapter, whichever is greater[, and paragraph (e) of
such subdivision].
7. For any taxable year, beginning on or after January first, nineteen
hundred eighty of a regulated investment company, as defined in section
eight hundred fifty-one of the internal revenue code, in which such
company is subject to federal income taxation under section eight
hundred fifty-two of such code, such company shall be subject to a tax
S. 6359 37 A. 8559
computed under either paragraph (a)[, (c)] or (d) of subdivision one of
section two hundred ten of this chapter, whichever is [greatest]
GREATER, and shall not be subject to any tax under article [thirty-two
or article] thirty-three of this chapter except for a captive RIC
required to file a combined return under [subdivision (f) of section
fourteen hundred sixty-two or] subdivision (f) of section fifteen
hundred fifteen of this chapter. In the case of such a regulated invest-
ment company, including a captive RIC as defined in section two of this
chapter, the term "entire net income" means "investment company taxable
income" as defined in paragraph two of subdivision (b) of section eight
hundred fifty-two, as modified by section eight hundred fifty-five, of
the internal revenue code plus the amount taxable under paragraph three
of subdivision (b) of section eight hundred fifty-two of such code
subject to the [modification] MODIFICATIONS required by subdivision nine
of section two hundred eight of this chapter[, other than the modifica-
tion required by subparagraph two of paragraph (a) and by paragraph (f)
thereof, including the modification required by paragraphs (d) and (e)
of subdivision three of section two hundred ten of this chapter].
8. For any taxable year beginning on or after January first, two thou-
sand six, a corporation that is no longer doing business, employing
capital, or owning or leasing property, OR DERIVING RECEIPTS FROM ACTIV-
ITY in this state in a corporate or organized capacity that has filed a
final tax return with the department for the last tax year it was doing
business and has no outstanding tax liability for such final tax return
or any tax return for prior tax years shall be exempt from all taxes
imposed by paragraph (d) of subdivision one of section two hundred ten
of this article for tax years following the last year such corporation
was doing business.
S 6. Section 209-A of the tax law is REPEALED.
S 7. The section heading and subdivision 1 of section 209-B of the tax
law, the section heading as amended by chapter 11 of the laws of 1983
and subdivision 1 as amended by section 4 of part A of chapter 59 of the
laws of 2013, are amended to read as follows:
[Temporary metropolitan] METROPOLITAN transportation business tax
surcharge. 1. (A) For the privilege of exercising its corporate fran-
chise, or of doing business, or of employing capital, or of owning or
leasing property in a corporate or organized capacity, or of maintaining
an office, OR OF DERIVING RECEIPTS FROM ACTIVITY in the metropolitan
commuter transportation district, for all or any part of its taxable
year, there is hereby imposed on every corporation, other than a New
York S corporation, subject to tax under section two hundred nine of
this article, or any receiver, referee, trustee, assignee or other fidu-
ciary, or any officer or agent appointed by any court, who conducts the
business of any such corporation, [for the taxable years commencing on
or after January first, nineteen hundred eighty-two but ending before
December thirty-first, two thousand eighteen,] a tax surcharge, in addi-
tion to the tax imposed under section two hundred nine of this article[,
to be computed at the rate of eighteen]. SUCH SURCHARGE SHALL BE THE
PRODUCT OF TWENTY-FOUR AND ONE-HALF percent of the tax imposed under
such section two hundred nine for such taxable years or any part of such
taxable years [ending before December thirty-first, nineteen hundred
eighty-three after the deduction of any credits otherwise allowable
under this article, and at the rate of seventeen percent of the tax
imposed under such section for such taxable years or any part of such
taxable years ending on or after December thirty-first, nineteen hundred
eighty-three after] BEFORE the deduction of any credits otherwise allow-
S. 6359 38 A. 8559
able under this article; provided, however, that such [rates] RATE of
tax surcharge shall be applied only to that portion of the tax imposed
under section two hundred nine of this article [after] BEFORE the
deduction of any credits otherwise allowable under this article which is
attributable to the taxpayer's business activity carried on within the
metropolitan commuter transportation district; and provided, further,
[that the tax surcharge imposed by this section shall not be imposed
upon any taxpayer for more than four hundred thirty-two months. Provided
however, that for taxable years commencing on or after July first, nine-
teen hundred ninety-eight, such surcharge shall be calculated as if the
tax imposed under section two hundred ten of this article were imposed
under the law in effect for taxable years commencing on or after July
first, nineteen hundred ninety-seven and before July first, nineteen
hundred ninety-eight. Provided however, that for taxable years commenc-
ing on or after January first, two thousand seven, such surcharge shall
be calculated using the highest of the tax bases imposed pursuant to
paragraphs (a), (b), (c) or (d) of subdivision one of section two
hundred ten of this article and the amount imposed under paragraph (e)
of subdivision one of such section two hundred ten, for the taxable
year; and, provided further that, if such highest amount is the tax base
imposed under paragraph (a), (b) or (c) of such subdivision, then the
surcharge shall be computed as if the tax rates and limitations under
such paragraph were the tax rates and limitations under such paragraph
in effect for taxable years commencing on or after July first, nineteen
hundred ninety-seven and before July first, nineteen hundred ninety-
eight] THE SURCHARGE COMPUTED ON A COMBINED REPORT SHALL INCLUDE A
SURCHARGE ON THE FIXED DOLLAR MINIMUM TAX FOR EACH MEMBER OF THE
COMBINED GROUP SUBJECT TO THE SURCHARGE UNDER THIS SUBDIVISION.
(B) A CORPORATION IS DERIVING RECEIPTS FROM ACTIVITY IN THE METROPOL-
ITAN COMMUTER TRANSPORTATION DISTRICT IF IT HAS RECEIPTS WITHIN THE
METROPOLITAN COMMUTER TRANSPORTATION DISTRICT OF ONE MILLION DOLLARS OR
MORE IN A TAXABLE YEAR. FOR PURPOSES OF THIS SECTION, THE TERM
"RECEIPTS" MEANS THE RECEIPTS THAT ARE SUBJECT TO THE APPORTIONMENT
RULES SET FORTH IN SECTION TWO HUNDRED TEN-A OF THIS ARTICLE, AND THE
TERM "RECEIPTS WITHIN THE METROPOLITAN COMMUTER TRANSPORTATION DISTRICT"
MEANS THE RECEIPTS INCLUDED IN THE NUMERATOR OF THE APPORTIONMENT FACTOR
DETERMINED UNDER SUBDIVISION TWO OF THIS SECTION.
(C) A CORPORATION IS DOING BUSINESS IN THE METROPOLITAN COMMUTER
TRANSPORTATION DISTRICT IF (I) IT HAS ISSUED CREDIT CARDS TO ONE THOU-
SAND OR MORE CUSTOMERS WHO HAVE A MAILING ADDRESS WITHIN THE METROPOL-
ITAN COMMUTER TRANSPORTATION DISTRICT AS OF THE LAST DAY OF ITS TAXABLE
YEAR, (II) IT HAS MERCHANT CUSTOMER CONTRACTS WITH MERCHANTS AND THE
TOTAL NUMBER OF LOCATIONS COVERED BY THOSE CONTRACTS EQUALS ONE THOUSAND
OR MORE LOCATIONS IN THE METROPOLITAN COMMUTER TRANSPORTATION DISTRICT
TO WHOM THE CORPORATION REMITTED PAYMENTS FOR CREDIT CARD TRANSACTIONS
DURING THE TAXABLE YEAR, OR (III) THE SUM OF THE NUMBER OF CUSTOMERS
DESCRIBED IN SUBPARAGRAPH (I) OF THIS PARAGRAPH PLUS THE NUMBER OF
LOCATIONS COVERED BY ITS CONTRACTS DESCRIBED IN SUBPARAGRAPH (II) OF
THIS PARAGRAPH EQUALS ONE THOUSAND OR MORE. FOR PURPOSES OF THIS PARA-
GRAPH, RECEIPTS FROM PROCESSING CREDIT CARD TRANSACTIONS FOR MERCHANTS
INCLUDE MERCHANT DISCOUNT FEES RECEIVED BY THE CORPORATION. AS USED IN
THIS PARAGRAPH, THE TERM "CREDIT CARD" INCLUDES BANK, CREDIT, TRAVEL AND
ENTERTAINMENT CARDS.
(D)(I) A CORPORATION WITH LESS THAN ONE MILLION DOLLARS BUT AT LEAST
TEN THOUSAND DOLLARS OF RECEIPTS WITHIN THE METROPOLITAN COMMUTER TRANS-
PORTATION DISTRICT IN A TAXABLE YEAR THAT IS PART OF A COMBINED REPORT-
S. 6359 39 A. 8559
ING GROUP IS DERIVING RECEIPTS FROM ACTIVITY IN THE METROPOLITAN COMMU-
TER TRANSPORTATION DISTRICT IF THE RECEIPTS WITHIN THE METROPOLITAN
COMMUTER TRANSPORTATION DISTRICT OF THE MEMBERS OF THE UNITARY BUSINESS
GROUP THAT HAVE AT LEAST TEN THOUSAND DOLLARS OF RECEIPTS WITHIN THE
METROPOLITAN COMMUTER TRANSPORTATION DISTRICT IN THE AGGREGATE MEET THE
THRESHOLD SET FORTH IN PARAGRAPH (B) OF THIS SUBDIVISION.
(II) A CORPORATION THAT DOES NOT MEET ANY OF THE THRESHOLDS SET FORTH
IN PARAGRAPH (C) OF THIS SUBDIVISION BUT HAS AT LEAST TEN CUSTOMERS, OR
LOCATIONS, OR CUSTOMERS AND LOCATIONS, AS DESCRIBED IN PARAGRAPH (C),
AND IS PART OF A COMBINED REPORTING GROUP IS DOING BUSINESS IN THE
METROPOLITAN COMMUTER TRANSPORTATION DISTRICT IF THE NUMBER OF CUSTOM-
ERS, LOCATIONS, OR CUSTOMERS AND LOCATIONS, WITHIN THE METROPOLITAN
COMMUTER TRANSPORTATION DISTRICT OF THE MEMBERS OF THE UNITARY BUSINESS
GROUP THAT HAVE AT LEAST TEN CUSTOMERS, LOCATIONS, OR CUSTOMERS AND
LOCATIONS, WITHIN THE METROPOLITAN COMMUTER TRANSPORTATION DISTRICT IN
THE AGGREGATE MEETS ANY OF THE THRESHOLDS SET FORTH IN PARAGRAPH (C) OF
THIS SUBDIVISION.
(E) AT THE END OF EACH YEAR, THE COMMISSIONER SHALL REVIEW THE CUMULA-
TIVE PERCENTAGE CHANGE IN THE CONSUMER PRICE INDEX. THE COMMISSIONER
SHALL ADJUST THE RECEIPT THRESHOLDS SET FORTH IN THIS SUBDIVISION IF THE
CONSUMER PRICE INDEX HAS CHANGED BY TEN PERCENT OR MORE SINCE JANUARY
FIRST, TWO THOUSAND FIFTEEN, OR SINCE THE DATE THAT THE THRESHOLDS WERE
LAST ADJUSTED UNDER THIS SUBDIVISION. THE THRESHOLDS SHALL BE ADJUSTED
TO REFLECT THAT CUMULATIVE PERCENTAGE CHANGE IN THE CONSUMER PRICE
INDEX. THE ADJUSTED THRESHOLDS SHALL BE ROUNDED TO THE NEAREST ONE THOU-
SAND DOLLARS. AS USED IN THIS PARAGRAPH, "CONSUMER PRICE INDEX" MEANS
THE CONSUMER PRICE INDEX FOR ALL URBAN CONSUMERS (CPI-U) AVAILABLE FROM
THE BUREAU OF LABOR STATISTICS OF THE UNITED STATES DEPARTMENT OF LABOR.
ANY ADJUSTMENT SHALL APPLY TO TAX PERIODS THAT BEGIN AFTER THE ADJUST-
MENT IS MADE.
S 8. The opening paragraph of subdivision 2 of section 209-B of the
tax law, as amended by chapter 11 of the laws of 1983, is amended to
read as follows:
The portion of the taxpayer's business activity carried on within the
metropolitan commuter transportation district shall be determined [by
multiplying the tax imposed under section two hundred nine of this arti-
cle by a percentage to be determined as follows:] PURSUANT TO THE METHOD
PRESCRIBED IN SECTION TWO HUNDRED TEN-A OF THIS ARTICLE EXCEPT THAT THE
REFERENCES TO "WITHIN THE STATE" SHALL REFER TO WITHIN THE METROPOLITAN
COMMUTER TRANSPORTATION DISTRICT AND REFERENCES TO "WITHIN AND WITHOUT
THE STATE" SHALL REFER TO WITHIN THE STATE.
S 9. Paragraphs (a), (b), (c) and (d) of subdivision 2 of section
209-B of the tax law are REPEALED.
S 10. Subdivisions 2-a and 2-b of section 209-B of the tax law are
REPEALED.
S 11. Subdivisions 3 and 5 of section 209-B of the tax law, subdivi-
sion 3 as amended by chapter 11 of the laws of 1983 and subdivision 5 as
amended by chapter 166 of the laws of 1991, are amended to read as
follows:
3. A corporation shall not be deemed to be doing business, employing
capital, owning or leasing property, or maintaining an office, OR DERIV-
ING RECEIPTS FROM ACTIVITY in the metropolitan commuter transportation
district, for the purposes of this section, by reason of (a) the mainte-
nance of cash balances with banks or trust companies in the metropolitan
commuter transportation district, or (b) the ownership of shares of
stock or securities kept in the metropolitan commuter transportation
S. 6359 40 A. 8559
district, if kept in a safe deposit box, safe, vault or other receptacle
rented for the purpose, or if pledged as collateral security, or if
deposited with one or more banks or trust companies, or brokers who are
members of a recognized security exchange, in safekeeping or custody
accounts, or (c) the taking of any action by any such bank or trust
company or broker, which is incidental to the rendering of safekeeping
or custodian service to such corporation, or (d) the maintenance of an
office in the metropolitan commuter transportation district by one or
more officers or directors of the corporation who are not employees of
the corporation if the corporation otherwise is not doing business in
the metropolitan commuter transportation district, and does not employ
capital or own or lease property in the metropolitan commuter transpor-
tation district, or (e) the keeping of books or records of a corporation
in the metropolitan commuter transportation district if such books or
records are not kept by employees of such corporation and such corpo-
ration does not otherwise do business, employ capital, own or lease
property or maintain an office in the metropolitan commuter transporta-
tion district, or (f) any combination of the foregoing activities.
5. The provisions concerning reports under [section] SECTIONS TWO
HUNDRED TEN-C AND two hundred eleven shall be applicable to this
section, except that for purposes of an automatic extension for six
months for filing a report covering the tax surcharge imposed by this
section, such automatic extension shall be allowed only if a taxpayer
files with the commissioner an application for extension in such form as
said commissioner may prescribe by regulation and pays on or before the
date of such filing in addition to any other amounts required under this
article, either ninety percent of the entire tax surcharge required to
be paid under this section for the applicable period, or not less than
the tax surcharge shown on the taxpayer's return for the preceding taxa-
ble year, if such preceding taxable year was a taxable year of twelve
months; provided, however, that in no event shall such amount be less
than the product of the following three amounts: (1) the tax surcharge
rate in effect for the taxable year pursuant to subdivision one of this
section, (2) the fixed dollar minimum applicable to such taxpayer as
determined under paragraph (d) of subdivision one of section two hundred
ten of this chapter for the taxable year, and (3) the percentage deter-
mined under subdivision two of this section for the preceding taxable
year, unless the taxpayer was not subject to the tax surcharge imposed
pursuant to this section with respect to such year, in which case such
percentage shall be deemed to be one hundred percent. The tax surcharge
imposed by this section shall be payable to the commissioner in full at
the time the report is required to be filed, and such tax surcharge or
the balance thereof, imposed on any taxpayer which ceases to exercise
its franchise or be subject to the tax surcharge imposed by this section
shall be payable to the commissioner at the time the report is required
to be filed, provided such tax surcharge of a domestic corporation which
continues to possess its franchise shall be subject to adjustment as the
circumstances may require; all other tax surcharges of any such taxpay-
er, which pursuant to the foregoing provisions of this section would
otherwise be payable subsequent to the time such report is required to
be filed, shall nevertheless be payable at such time. All of the
provisions of this article presently applicable are applicable to the
tax surcharge imposed by this section.
S 12. Subdivision 1 of section 210 of the tax law, as added by chapter
817 of the laws of 1987, the opening paragraph as amended by section 1
of part D and paragraph (g) as amended by section 2 of part A of chapter
S. 6359 41 A. 8559
63 of the laws of 2000, paragraph (a) as amended by section 2 of part N
of chapter 60 of the laws of 2007, subparagraphs 2 and 3 of paragraph
(b) as amended by section 17 of LBD number 74021-03-4, subparagraph (ii)
of paragraph (c) as amended by section 2 of part C and subparagraph 5 of
paragraph (d) as added by section 3 of part C of chapter 56 of the laws
of 2011, subparagraphs (vi) and (vii) of paragraph (a) as amended by
section 16 of LBD number 74021-03-4, subparagraph (iii) of paragraph (c)
as added by section 3 of part Z, and subparagraph 6 of paragraph (d) as
added by section 4 of part Z of chapter 59 of the laws of 2013, para-
graph (b) as amended by section 1 of part GG1, subparagraph 3 of para-
graph (d) as amended by section 3 of part AA1, subparagraph 4 of para-
graph (d) as added by section 2 of part AA1 and subparagraph 1 of
paragraph (g) as amended by section 4 of part AA1 of chapter 57 of the
laws of 2008, paragraph (c) as amended by section 10 of part A and
subparagraph 1 of paragraph (d) as amended by section 12 of part A of
chapter 56 of the laws of 1998, paragraph (d) as amended by chapter 760
of the laws of 1992, paragraph (e) as amended by section 1 of part P of
chapter 407 of the laws of 1999, paragraph (f) as amended by section 2
of part E of chapter 61 of the laws of 2005 and paragraph (h) as added
by section 20 of LBD number 74021-03-4, is amended to read as follows:
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 corpo-
ration, the amount prescribed in paragraph [(g)] (D) of this subdivi-
sion, and (C) in the case of a qualified homeowners association, the
[sum of (1) the] highest of the amounts prescribed in paragraphs (a)[,]
AND (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 twen-
ty-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, FOR TAXABLE YEARS BEGINNING BEFORE JANUARY FIRST, TWO THOU-
SAND SIXTEEN, 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] HIGHER 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] BUSINESS 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 thou-
sand and before July first, two thousand one, the amount prescribed by
S. 6359 42 A. 8559
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 and before January first, two thousand
seven, 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.] For taxable years beginning [on or after] BEFORE January first,
two thousand [seven] SIXTEEN, the amount prescribed by this paragraph
shall be computed at the rate of seven and one-tenth percent of the
taxpayer's [entire net] BUSINESS income base. FOR TAXABLE YEARS BEGIN-
NING ON OR AFTER JANUARY FIRST, TWO THOUSAND SIXTEEN, THE AMOUNT
PRESCRIBED BY THIS PARAGRAPH SHALL BE SIX AND ONE-HALF PERCENT OF THE
TAXPAYER'S BUSINESS INCOME BASE. The taxpayer's [entire net] BUSINESS
income base shall mean the portion of the taxpayer's [entire net] BUSI-
NESS 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 taxpay-
er, as defined in paragraph (f) of this subdivision, the amount
prescribed by this paragraph shall be computed pursuant to subparagraph
(iv) of this paragraph and in the case of a manufacturer, as defined in
subparagraph (vi) of this paragraph, the amount prescribed by this para-
graph shall be computed pursuant to subparagraph (vi) of this paragraph.
[(i) if the entire net income base is not more than two hundred thou-
sand dollars, (1) for taxable years beginning before July first, nine-
teen hundred ninety-nine, the amount shall be eight percent of the
entire net income base; (2) for taxable years beginning after June thir-
tieth, 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 taxa-
ble 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)
S. 6359 43 A. 8559
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 thou-
sand five and ending before January first, two thousand seven, 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 thou-
sand dollars;]
(iv) for taxable years beginning [on or after] BEFORE January first,
two thousand [seven] SIXTEEN, if the [entire net] BUSINESS income base
is not more than two hundred ninety thousand dollars the amount shall be
six and one-half percent of the [entire net] BUSINESS income base; if
the [entire net] BUSINESS 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-tenth percent of the excess of the [entire
net] BUSINESS income base over two hundred ninety thousand dollars but
not over three hundred ninety thousand dollars and (3) four and thirty-
five hundredths percent of the excess of the [entire net] BUSINESS
income base over three hundred fifty thousand dollars but not over three
hundred ninety thousand dollars;
(v) if the taxable period to which [subparagraphs (i), (ii), (iii),
and] SUBPARAGRAPH (iv) of this paragraph [apply] APPLIES is less than
twelve months, the amount prescribed by this paragraph shall be computed
as follows:
(A) Multiply the [entire net] BUSINESS 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)] SUBPAR-
AGRAPH (IV) as if the result obtained in (B) were the taxpayer's [entire
net] BUSINESS 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.
(vi) except as otherwise provided in this subparagraph or subparagraph
(vii) of this paragraph, for taxable years beginning on or after January
thirty-first, two thousand seven, the amount prescribed by this para-
graph for a taxpayer which is a qualified New York manufacturer, as
defined in subdivision fifteen of section two hundred eight of this
article, shall be computed at the rate of six and one-half (6.5) percent
of the taxpayer's [entire net] BUSINESS income base. [For taxable years
beginning on or after January first, two thousand twelve and before
January first, two thousand fifteen, the amount prescribed by this para-
graph for a taxpayer which is an eligible qualified New York manufactur-
er shall be computed at the rate of three and one-quarter (3.25) percent
of the taxpayer's entire net income base. The commissioner shall estab-
lish guidelines and criteria that specify requirements by which a
manufacturer may be classified as an eligible qualified New York
S. 6359 44 A. 8559
manufacturer. Criteria may include but not be limited to factors such as
regional unemployment, the economic impact that manufacturing has on the
surrounding community, population decline within the region and median
income within the region in which the manufacturer is located. In estab-
lishing these guidelines and criteria, the commissioner shall endeavor
that the total annual cost of the lower rates shall not exceed twenty-
five million dollars.]
For a qualified New York manufacturer, as defined in subdivision
fifteen of section two hundred eight of this article, the rate at which
the tax is computed in effect for taxable years beginning on or after
January first, two thousand thirteen and before January first, two thou-
sand fourteen for qualified New York manufacturers shall be reduced by
nine and two-tenths percent for taxable years commencing on or after
January first, two thousand fourteen and before January first, two thou-
sand fifteen, twelve and three-tenths percent for taxable years commenc-
ing on or after January first, two thousand fifteen and before January
first, two thousand sixteen, fifteen and four-tenths percent for taxable
years commencing on or after January first, two thousand sixteen and
before January first, two thousand eighteen, and twenty-five percent for
taxable years beginning on or after January first, two thousand eigh-
teen.
(vii) For a qualified New York manufacturer that has an apportionment
factor for purposes of the metropolitan transportation business tax
surcharge computed pursuant to subdivision two of section two hundred
nine-B of this article equal to zero for the taxable year, the amount
prescribed by this paragraph for taxable years beginning on or after
January first, two thousand fourteen shall be computed at the rate of
zero percent of the taxpayer's entire net income base.
(VIII) IN COMPUTING THE BUSINESS INCOME BASE, A NET OPERATING LOSS
DEDUCTION SHALL BE ALLOWED. A NET OPERATING LOSS DEDUCTION IS THE AMOUNT
OF NET OPERATING LOSS OR LOSSES FROM ONE OR MORE TAXABLE YEARS THAT ARE
CARRIED FORWARD TO A PARTICULAR INCOME YEAR. A NET OPERATING LOSS IS THE
AMOUNT OF A BUSINESS LOSS INCURRED IN A PARTICULAR TAX YEAR MULTIPLIED
BY THE APPORTIONMENT FACTOR FOR THAT YEAR AS DETERMINED UNDER SECTION
TWO HUNDRED TEN-A OF THIS ARTICLE. THE MAXIMUM NET OPERATING DEDUCTION
THAT IS ALLOWED IN A TAXABLE YEAR IS THE AMOUNT THAT REDUCES THE TAXPAY-
ER'S TAX ON ALLOCATED BUSINESS INCOME TO THE HIGHER OF THE TAX ON THE
CAPITAL BASE OR THE FIXED DOLLAR MINIMUM. SUCH DEDUCTION AND LOSS ARE
DETERMINED IN ACCORDANCE WITH THE FOLLOWING:
(1) SUCH NET OPERATING LOSS DEDUCTION IS NOT LIMITED TO THE AMOUNT
ALLOWED UNDER SECTION ONE HUNDRED SEVENTY-TWO OF THE INTERNAL REVENUE
CODE OR THE AMOUNT THAT WOULD HAVE BEEN ALLOWED IF THE TAXPAYER HAD NOT
MADE AN ELECTION UNDER SUBCHAPTER S OF CHAPTER ONE OF THE INTERNAL
REVENUE CODE.
(2) SUCH NET OPERATING LOSS DEDUCTION SHALL NOT INCLUDE ANY NET OPER-
ATING LOSS INCURRED DURING ANY TAXABLE YEAR BEGINNING PRIOR TO JANUARY
FIRST, TWO THOUSAND FIFTEEN, OR DURING ANY TAXABLE YEAR IN WHICH THE
TAXPAYER WAS NOT SUBJECT TO THE TAX IMPOSED BY THIS ARTICLE.
(3) A TAXPAYER THAT FILES AS PART OF A FEDERAL CONSOLIDATED RETURN BUT
ON A SEPARATE BASIS FOR PURPOSES OF THIS ARTICLE MUST COMPUTE ITS
DEDUCTION AND LOSS AS IF IT WERE FILING ON A SEPARATE BASIS FOR FEDERAL
INCOME TAX PURPOSES.
(4) A NET OPERATING LOSS MUST BE CARRIED FORWARD TO EACH OF THE TWENTY
TAXABLE YEARS FOLLOWING THE TAXABLE YEAR OF THE LOSS. NO CARRYBACK OF
THE NET OPERATING LOSS IS ALLOWED. A TAXPAYER MUST APPLY BOTH OF THESE
LIMITATIONS IN COMPUTING SUCH NET OPERATING LOSS DEDUCTION.
S. 6359 45 A. 8559
(5) SUCH NET OPERATING LOSS DEDUCTION SHALL NOT INCLUDE ANY NET OPER-
ATING LOSS INCURRED DURING A NEW YORK S YEAR; PROVIDED, HOWEVER, A NEW
YORK S YEAR MUST BE TREATED AS A TAXABLE YEAR FOR PURPOSES OF DETERMIN-
ING THE NUMBER OF TAXABLE YEARS TO WHICH A NET OPERATING LOSS MAY BE
CARRIED FORWARD.
(6) WHERE THERE ARE TWO OR MORE ALLOCATED NET OPERATING LOSSES, OR
PORTIONS THEREOF, CARRIED FORWARD TO BE DEDUCTED IN ONE PARTICULAR TAX
YEAR FROM ALLOCATED BUSINESS INCOME, THE EARLIEST ALLOCATED LOSS
INCURRED MUST BE APPLIED FIRST.
(b) Capital base. (1) The [amount prescribed by this paragraph for
taxable years beginning before January first, two thousand eight shall
be computed at .178 percent for each dollar of the taxpayer's total
business and investment capital, or the portion thereof allocated within
the state as hereinafter provided. For taxable years beginning on or
after January first, two thousand eight, the] amount prescribed by this
paragraph shall be computed at .15 percent for each dollar of the
taxpayer's total business [and investment] capital, or the portion ther-
eof allocated within the state as hereinafter provided. However, in the
case of a cooperative housing corporation as defined in the internal
revenue code, the applicable rate shall be .04 percent. In no event
shall the amount prescribed by this paragraph exceed three hundred fifty
thousand dollars for qualified New York manufacturers and for all other
taxpayers [ten] FIVE million dollars [for taxable years beginning on or
after January first, two thousand eight but before January first, two
thousand eleven and one million dollars for taxable years beginning on
or after January first, two thousand eleven].
(2) For a qualified New York manufacturer, as defined in subdivision
fifteen of section two hundred eight of this article, the rate at which
the tax is computed in effect for taxable years beginning on or after
January first, two thousand thirteen and before January first, two thou-
sand fourteen shall be reduced by nine and two-tenths percent for taxa-
ble years commencing on or after January first, two thousand fourteen
and before January first, two thousand fifteen, twelve and three-tenths
percent for taxable years commencing on or after January first, two
thousand fifteen and before January first, two thousand sixteen, fifteen
and four-tenths percent for taxable years commencing on or after January
first, two thousand sixteen and before January first, two thousand eigh-
teen, and twenty-five percent for taxable years beginning on or after
January first, two thousand eighteen.
[(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 para-
graphs (d) and (e) of subdivision three of this section;
(ii) (A) For taxable years beginning on or after January first, two
thousand seven, the amount prescribed by this paragraph shall be
computed at the rate of one and one-half percent of the taxpayer's mini-
mum taxable income base. The "taxpayer's minimum taxable income base"
shall mean the portion of the taxpayer's minimum taxable income allo-
S. 6359 46 A. 8559
cated within the state as hereinafter provided, subject to any modifica-
tions required by paragraphs (d) and (e) of subdivision three of this
section.
(B) For taxable years beginning on or after January first, two thou-
sand twelve and before January first, two thousand fifteen, the amount
prescribed by this paragraph for an eligible qualified New York manufac-
turer shall be computed at the rate of seventy-five hundredths (.75)
percent of the taxpayer's minimum taxable income base. For purposes of
this clause, the term "eligible qualified New York manufacturer" shall
have the same meaning as in subparagraph (vi) of paragraph (a) of this
subdivision.
(iii) For a qualified New York manufacturer, as defined in subpara-
graph (vi) of paragraph (a) of this subdivision, the rate at which the
tax is computed in effect for taxable years beginning on or after Janu-
ary first, two thousand thirteen and before January first, two thousand
fourteen for qualified New York manufacturers shall be reduced by nine
and two-tenths percent for taxable years commencing on or after January
first, two thousand fourteen and before January first, two thousand
fifteen, twelve and three-tenths percent for taxable years commencing on
or after January first, two thousand fifteen and before January first,
two thousand sixteen, fifteen and four-tenths percent for taxable years
commencing on or after January first, two thousand sixteen and before
January first, two thousand eighteen, and twenty-five percent for taxa-
ble years beginning on or after January first, two thousand eighteen.]
(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 thou-
sand 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 para-
graph (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 subdivi-
sion 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
S. 6359 47 A. 8559
the period for which the taxpayer is subject to tax is more than six
months but not more than nine months and by fifty percent 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. If the taxable year is less than twelve months, the
amount of New York receipts for purposes of subparagraph four of this
paragraph is determined by dividing the amount of the receipts for the
taxable year by the number of months in the taxable year and multiplying
the result by twelve.
(4) Notwithstanding subparagraphs one and two of this paragraph, for
taxable years beginning on or after January first, two thousand eight,
the] amount prescribed by this paragraph for New York S corporations
will be determined in accordance with the following table:
If New York receipts are: The fixed dollar minimum tax is:
not more than $100,000 $ 25
more than $100,000 but not over $250,000 $ 50
more than $250,000 but not over $500,000 $ 175
more than $500,000 but not over $1,000,000 $ 300
more than $1,000,000 but not over $5,000,000 $1,000
more than $5,000,000 but not over $25,000,000 $3,000
Over $25,000,000 $4,500
Otherwise the amount prescribed by this paragraph will be determined in
accordance with the following table:
PROVIDED FURTHER, THE AMOUNT PRESCRIBED BY THIS PARAGRAPH FOR A QUALI-
FIED NEW YORK MANUFACTURER, AS DEFINED IN SUBDIVISION FIFTEEN OF SECTION
TWO HUNDRED EIGHT OF THIS ARTICLE, WILL BE DETERMINED IN ACCORDANCE WITH
THE FOLLOWING TABLES:
FOR TAX YEARS BEGINNING ON OR AFTER JANUARY 1, 2014 AND BEFORE JANUARY
1, 2015:
IF NEW YORK RECEIPTS ARE: THE FIXED DOLLAR MINIMUM TAX IS:
NOT MORE THAN $100,000 $ 23
MORE THAN $100,000 BUT NOT OVER $250,000 $ 68
MORE THAN $250,000 BUT NOT OVER $500,000 $ 159
MORE THAN $500,000 BUT NOT OVER $1,000,000 $ 454
MORE THAN $1,000,000 BUT NOT OVER $5,000,000 $1,362
MORE THAN $5,000,000 BUT NOT OVER $25,000,000 $3,178
OVER $25,000,000 $4,500
FOR TAX YEARS BEGINNING ON OR AFTER JANUARY 1, 2015 AND BEFORE JANUARY
1, 2016:
IF NEW YORK RECEIPTS ARE: THE FIXED DOLLAR MINIMUM TAX IS:
NOT MORE THAN $100,000 $ 22
MORE THAN $100,000 BUT NOT OVER $250,000 $ 66
MORE THAN $250,000 BUT NOT OVER $500,000 $ 153
MORE THAN $500,000 BUT NOT OVER $1,000,000 $ 439
MORE THAN $1,000,000 BUT NOT OVER $5,000,000 $1,316
MORE THAN $5,000,000 BUT NOT OVER $25,000,000 $3,070
OVER $25,000,000 $4,385
S. 6359 48 A. 8559
FOR TAX YEARS BEGINNING ON OR AFTER JANUARY 1, 2016 AND BEFORE JANUARY
1, 2018:
IF NEW YORK RECEIPTS ARE: THE FIXED DOLLAR MINIMUM TAX IS:
NOT MORE THAN $100,000 $ 21
MORE THAN $100,000 BUT NOT OVER $250,000 $ 63
MORE THAN $250,000 BUT NOT OVER $500,000 $ 148
MORE THAN $500,000 BUT NOT OVER $1,000,000 $ 423
MORE THAN $1,000,000 BUT NOT OVER $5,000,000 $1,269
MORE THAN $5,000,000 BUT NOT OVER $25,000,000 $2,961
OVER $25,000,000 $4,230
FOR TAX YEARS BEGINNING ON OR AFTER JANUARY 1, 2018:
IF NEW YORK RECEIPTS ARE: THE FIXED DOLLAR MINIMUM TAX IS:
NOT MORE THAN $100,000 $ 19
MORE THAN $100,000 BUT NOT OVER $250,000 $ 56
MORE THAN $250,000 BUT NOT OVER $500,000 $ 131
MORE THAN $500,000 BUT NOT OVER $1,000,000 $ 375
MORE THAN $1,000,000 BUT NOT OVER $5,000,000 $1,125
MORE THAN $5,000,000 BUT NOT OVER $25,000,000 $2,625
OVER $25,000,000 $3,750
OTHERWISE THE AMOUNT PRESCRIBED BY THIS PARAGRAPH WILL BE DETERMINED IN
ACCORDANCE WITH THE FOLLOWING TABLE:
If New York receipts are: The fixed dollar minimum tax is:
not more than $100,000 $ 25
more than $100,000 but not over $250,000 $ 75
more than $250,000 but not over $500,000 $ 175
more than $500,000 but not over $1,000,000 $ 500
more than $1,000,000 but not over $5,000,000 $1,500
more than $5,000,000 but not over $25,000,000 $3,500
[Over] $25,000,000 BUT NOT OVER $50,000,000 $5,000
MORE THAN $50,000,000 BUT NOT OVER $100,000,000 $10,000
MORE THAN $100,000,000 BUT NOT OVER $250,000,000 $20,000
MORE THAN $250,000,000 BUT NOT OVER $500,000,000 50,000
MORE THAN $500,000,000 BUT NOT OVER $1,000,000,000 $100,000
OVER $1,000,000,000 $200,000
For purposes of this paragraph, New York receipts are the receipts
[computed in accordance with subparagraph two of paragraph (a) of subdi-
vision three of this] INCLUDED IN THE NUMERATOR OF THE APPORTIONMENT
FACTOR DETERMINED UNDER section TWO HUNDRED TEN-A for the taxable year.
(2) IF THE TAXABLE YEAR IS LESS THAN TWELVE MONTHS, THE AMOUNT OF NEW
YORK RECEIPTS IS DETERMINED BY DIVIDING THE AMOUNT OF THE RECEIPTS FOR
THE TAXABLE YEAR BY THE NUMBER OF MONTHS IN THE TAXABLE YEAR AND MULTI-
PLYING THE RESULT BY TWELVE. IN THE CASE OF A TERMINATION YEAR OF A NEW
YORK S CORPORATION, THE SUM OF THE TAX COMPUTED UNDER THIS PARAGRAPH FOR
THE S SHORT YEAR AND FOR THE C SHORT YEAR SHALL NOT BE LESS THAN THE
AMOUNT COMPUTED UNDER THIS PARAGRAPH AS IF THE CORPORATION WERE A NEW
YORK C CORPORATION FOR THE ENTIRE TAXABLE YEAR.
[(5) For taxable years beginning on or after January first, two thou-
sand twelve and before January first, two thousand fifteen, the amounts
prescribed in subparagraphs one and four of this paragraph as the fixed
dollar minimum tax for an eligible qualified New York manufacturer shall
S. 6359 49 A. 8559
be one-half of the amounts stated in those subparagraphs. For purposes
of this subparagraph, the term "eligible qualified New York manufactur-
er" shall have the same meaning as in subparagraph (vi) of paragraph (a)
of this subdivision.
(6) For a qualified New York manufacturer, as defined in subparagraph
(vi) of paragraph (a) of this subdivision, the amounts prescribed in
subparagraphs one and four of this paragraph in effect for taxable years
beginning on or after January first, two thousand thirteen and before
January first, two thousand fourteen for qualified New York manufactur-
ers shall be reduced by nine and two-tenths percent for taxable years
commencing on or after January first, two thousand fourteen and before
January first, two thousand fifteen, twelve and three-tenths percent for
taxable years commencing on or after January first, two thousand fifteen
and before January first, two thousand sixteen, fifteen and four-tenths
percent for taxable years commencing on or after January first, two
thousand sixteen and before January first, two thousand eighteen, and
twenty-five percent for taxable years beginning on or after January
first, two thousand eighteen.
(e) Subsidiary capital base. (1) The amount prescribed by this para-
graph 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 nine-
ty-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 subpara-
graph (A) thereof) as of the last day of the taxable year] THE AGGREGATE
AMOUNT OF MONEY AND OTHER PROPERTY RECEIVED BY THE CORPORATION FOR
STOCK, AS A CONTRIBUTION TO CAPITAL, AND AS PAID-IN SURPLUS, DOES NOT
EXCEED ONE MILLION DOLLARS; [and] (iii) which is not part of an affil-
iated 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 taxpay-
er" pursuant to this subdivision; AND (IV) WHICH HAS AN AVERAGE NUMBER
OF INDIVIDUALS, EXCLUDING GENERAL EXECUTIVE OFFICERS, EMPLOYED FULL-TIME
IN THE STATE DURING THE TAXABLE YEAR OF ONE HUNDRED OR FEWER. 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.
S. 6359 50 A. 8559
FOR PURPOSES OF SUBPARAGRAPH (II) OF THIS PARAGRAPH, THE AMOUNT TAKEN
INTO ACCOUNT WITH RESPECT TO ANY PROPERTY OTHER THAN MONEY SHALL BE THE
AMOUNT EQUAL TO THE ADJUSTED BASIS TO THE CORPORATION OF SUCH PROPERTY
FOR DETERMINING GAIN, REDUCED BY ANY LIABILITY TO WHICH THE PROPERTY WAS
SUBJECT OR WHICH WAS ASSUMED BY THE CORPORATION. THE DETERMINATION UNDER
THE PRECEDING SENTENCE SHALL BE MADE AS OF THE TIME THE PROPERTY WAS
RECEIVED BY THE CORPORATION. FOR PURPOSES OF SUBPARAGRAPH (III) OF THIS
SECTION, "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. AN INDIVIDUAL EMPLOYED FULL-TIME MEANS AN EMPLOYEE IN
A JOB CONSISTING OF AT LEAST THIRTY-FIVE HOURS PER WEEK, OR TWO OR MORE
EMPLOYEES WHO ARE IN JOBS THAT TOGETHER CONSTITUTE THE EQUIVALENT OF A
JOB AT LEAST THIRTY-FIVE HOURS PER WEEK (FULL-TIME EQUIVALENT).
FULL-TIME EQUIVALENT EMPLOYEES IN THE STATE INCLUDES ALL EMPLOYEES REGU-
LARLY CONNECTED WITH OR WORKING OUT OF AN OFFICE OR PLACE OF BUSINESS OF
THE TAXPAYER WITHIN THE STATE.
(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 that 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 that paragraph (d) (applying the provisions of
subparagraph three of that paragraph as necessary). Provided, however,
notwithstanding any provision of this paragraph, in taxable years begin-
ning in two thousand three and before two thousand eight, the amount
prescribed by this paragraph shall be the amount prescribed in subpara-
graph one of that paragraph (d) (applying the provisions of subparagraph
three of that paragraph as necessary) and applying the calculation of
that amount in the case of a termination year as set forth in subpara-
graph four of this paragraph as necessary. In taxable years beginning in
two thousand eight and thereafter, the amount prescribed by this para-
graph is] the amount prescribed in subparagraph four of that paragraph
(d) [(applying the provisions of subparagraph three of that paragraph as
necessary)] and applying the calculation of that amount in the case of a
termination year as set forth in subparagraph four of this paragraph as
necessary.
(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 subdi-
vision by substituting for the rate therein the rate of 7.875 percent.
For taxable years beginning after June thirtieth, nineteen hundred nine-
ty-nine and before July first, two thousand, the article twenty-two tax
equivalent is the amount computed under paragraph (a) of this subdivi-
sion 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 substi-
tuting for the rate therein the rate of 7.175 percent. For taxable years
S. 6359 51 A. 8559
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 equiv-
alent 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 thou-
sand 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 arti-
cle 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 thou-
sand 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
S. 6359 52 A. 8559
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 SHALL NOT 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.
[(h) For purposes of determining whether a taxpayer is an eligible
qualified New York manufacturer for purposes of the tax benefits
provided in subparagraph (vi) of paragraph (a) of this subdivision,
subparagraph (ii) of paragraph (c) of this subdivision, and subparagraph
five of paragraph (d) of this subdivision, a taxpayer shall utilize the
law, guidelines and criteria in effect on December thirty-first, two
thousand thirteen.]
S 13. Subdivision 1-c of section 210 of the tax law, as amended by
chapter 1043 of the laws of 1981, the opening paragraph and paragraph
(a) as amended by chapter 817 of the laws of 1987, and paragraph (b) as
amended by section 12 of part Y of chapter 63 of the laws of 2000, is
amended to read as follows:
1-c. The computations specified in paragraph (b) of subdivision one of
this section shall not apply to the first two taxable years of a taxpay-
er which, for one or both such years, is a small business [concern. A
small business concern:
(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,
(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 eight-
y-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 busi-
ness 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 previ-
ously 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 para-
graph (a) of subdivision three of this section) were principally
employed in this state during the taxable year] TAXPAYER AS DEFINED IN
PARAGRAPH (F) OF SUBDIVISION ONE OF THIS SECTION.
S 14. Subdivision 2 of section 210 of the tax law, as amended by chap-
ter 760 of the laws of 1992, is amended to read as follows:
S. 6359 53 A. 8559
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 peri-
od, 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.
S 15. Subdivisions 3, 3-a, 4, 5, 6, 7, 8, 9, 10, 11, 12, 12-A, 12-B,
12-C, 12-D, 12-E, 12-F, 12-G, 13, 14, 15, 16, 17, 18, 19, 20, 21, 21-a,
22, 23, 23-a, 24, 25, 25-a, 26, 26-a, 27, 28, 30, 31, 32, 33, 34, 35,
36, 37, 38, 39, 40, 41, 42, 43, 44, 45, 46, 47, subdivision 48 as added
by section 3 of LBD number 74039-02-4 and subdivision 48 as added by
section 2 of LBD number 74021-03-4 of section 210 of the tax law are
REPEALED.
S 16. The tax law is amended by adding a new section 210-A to read as
follows:
S 210-A. APPORTIONMENT. 1. GENERAL. BUSINESS INCOME AND CAPITAL SHALL
BE APPORTIONED TO THE STATE BY THE APPORTIONMENT FACTOR DETERMINED
PURSUANT TO THIS SECTION. THE APPORTIONMENT FACTOR IS A FRACTION, DETER-
MINED BY INCLUDING ONLY THOSE RECEIPTS, NET INCOME, NET GAINS, AND OTHER
ITEMS DESCRIBED IN THIS SECTION THAT ARE INCLUDED IN THE COMPUTATION OF
THE TAXPAYER'S BUSINESS INCOME FOR THE TAXABLE YEAR. THE NUMERATOR OF
THE APPORTIONMENT FRACTION SHALL BE EQUAL TO THE SUM OF ALL THE AMOUNTS
REQUIRED TO BE INCLUDED IN THE NUMERATOR PURSUANT TO THE PROVISIONS OF
THIS SECTION AND THE DENOMINATOR OF THE APPORTIONMENT FRACTION SHALL BE
EQUAL TO THE SUM OF ALL THE AMOUNTS REQUIRED TO BE INCLUDED IN THE
DENOMINATOR PURSUANT TO THE PROVISIONS OF THIS SECTION.
2. SALES OF TANGIBLE PERSONAL PROPERTY AND ELECTRICITY. (A) RECEIPTS
FROM SALES OF TANGIBLE PERSONAL PROPERTY WHERE SHIPMENTS ARE MADE TO
POINTS WITHIN THE STATE OR THE DESTINATION OF THE PROPERTY IS A POINT IN
THE STATE SHALL BE INCLUDED IN THE NUMERATOR OF THE APPORTIONMENT FRAC-
TION. RECEIPTS FROM SALES OF TANGIBLE PERSONAL PROPERTY WHERE SHIPMENTS
ARE MADE TO POINTS WITHIN AND WITHOUT THE STATE OR THE DESTINATION IS
WITHIN AND WITHOUT THE STATE SHALL BE INCLUDED IN THE DENOMINATOR OF THE
APPORTIONMENT FRACTION.
(B) RECEIPTS FROM SALES OF ELECTRICITY DELIVERED TO POINTS WITHIN THE
STATE SHALL BE INCLUDED IN THE NUMERATOR OF THE APPORTIONMENT FRACTION.
RECEIPTS FROM SALES OF ELECTRICITY DELIVERED TO POINTS WITHIN AND WITH-
OUT THE STATE SHALL BE INCLUDED IN THE DENOMINATOR OF THE APPORTIONMENT
FRACTION.
(C) RECEIPTS FROM SALES OF TANGIBLE PERSONAL PROPERTY AND ELECTRICITY
THAT ARE TRADED AS COMMODITIES AS DESCRIBED IN SECTION 475 OF THE INTER-
NAL REVENUE CODE ARE INCLUDED IN THE APPORTIONMENT FRACTION IN ACCORD-
ANCE WITH CLAUSE (I) OF SUBPARAGRAPH TWO OF PARAGRAPH (A) OF SUBDIVISION
FIVE OF THIS SECTION.
3. RENTALS AND ROYALTIES. (A) RECEIPTS FROM RENTALS OF REAL AND TANGI-
BLE PERSONAL PROPERTY LOCATED WITHIN THE STATE ARE INCLUDED IN THE
NUMERATOR OF THE APPORTIONMENT FRACTION. RECEIPTS FROM RENTALS OF REAL
AND TANGIBLE PERSONAL PROPERTY LOCATED WITHIN AND WITHOUT THE STATE
SHALL BE INCLUDED IN THE DENOMINATOR OF THE APPORTIONMENT FRACTION.
S. 6359 54 A. 8559
(B) RECEIPTS OF ROYALTIES FROM THE USE OF PATENTS, COPYRIGHTS, AND
SIMILAR INTANGIBLE PERSONAL PROPERTY WITHIN THE STATE ARE INCLUDED IN
THE NUMERATOR OF THE APPORTIONMENT FRACTION. RECEIPTS OF ROYALTIES FROM
THE USE OF PATENTS, COPYRIGHTS, TRADEMARKS AND SIMILAR INTANGIBLES WITH-
IN AND WITHOUT THE STATE ARE INCLUDED IN THE DENOMINATOR OF THE APPOR-
TIONMENT FRACTION.
(C) 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 ARE INCLUDED IN THE NUMERATOR OF THE
APPORTIONMENT FRACTION TO THE EXTENT THAT SUCH RECEIPTS ARE ATTRIBUTABLE
TO SUCH TRANSMISSIONS RECEIVED OR EXHIBITED WITHIN THE STATE. RECEIPTS
FROM ALL SALES OF RIGHTS FOR CLOSED-CIRCUIT AND CABLE TELEVISION TRANS-
MISSIONS OF AN EVENT ARE INCLUDED IN THE DENOMINATOR OF THE APPORTION-
MENT FRACTION.
4. DIGITAL PRODUCTS. (A) FOR PURPOSES OF DETERMINING THE APPORTIONMENT
FRACTION UNDER THIS SECTION, THE TERM "DIGITAL PRODUCT" MEANS ANY PROP-
ERTY OR SERVICE, OR COMBINATION THEREOF, OF WHATEVER NATURE DELIVERED TO
THE PURCHASER THROUGH THE USE OF WIRE, CABLE, FIBER-OPTIC, LASER, MICRO-
WAVE, RADIO WAVE, SATELLITE OR SIMILAR SUCCESSOR MEDIA, OR ANY COMBINA-
TION THEREOF. DIGITAL PRODUCT INCLUDES, BUT IS NOT LIMITED TO, AN AUDIO
WORK, AUDIOVISUAL WORK, VISUAL WORK, BOOK OR LITERARY WORK, GRAPHIC
WORK, GAME, INFORMATION OR ENTERTAINMENT SERVICE, STORAGE OF DIGITAL
PRODUCTS AND COMPUTER SOFTWARE BY WHATEVER MEANS DELIVERED. THE TERM
"DELIVERED TO" INCLUDES FURNISHED OR PROVIDED TO OR ACCESSED BY. A
DIGITAL PRODUCT DOES NOT INCLUDE LEGAL, MEDICAL, ACCOUNTING, ARCHITEC-
TURAL, RESEARCH, ANALYTICAL, ENGINEERING OR CONSULTING SERVICES PROVIDED
BY THE TAXPAYER.
(B) RECEIPTS FROM THE SALE OF, LICENCE TO USE, OR GRANTING OF REMOTE
ACCESS TO DIGITAL PRODUCTS WITHIN THE STATE, DETERMINED ACCORDING TO THE
HIERARCHY OF METHODS SET FORTH IN SUBPARAGRAPHS ONE THROUGH FOUR OF
PARAGRAPH (C) OF THIS SUBDIVISION, SHALL BE INCLUDED IN THE NUMERATOR OF
THE APPORTIONMENT FRACTION. RECEIPTS FROM THE SALE OF, LICENSE TO USE,
OR GRANTING OF REMOTE ACCESS TO DIGITAL PRODUCTS WITHIN AND WITHOUT THE
STATE SHALL BE INCLUDED IN THE DENOMINATOR OF THE APPORTIONMENT FRAC-
TION. THE TAXPAYER MUST EXERCISE DUE DILIGENCE UNDER EACH METHOD
DESCRIBED IN PARAGRAPH (C) OF THIS SUBDIVISION BEFORE REJECTING IT AND
PROCEEDING TO THE NEXT METHOD IN THE HIERARCHY. IF THE RECEIPT FOR A
DIGITAL PRODUCT IS COMPRISED OF A COMBINATION OF PROPERTY AND SERVICES,
IT CANNOT BE DIVIDED INTO SEPARATE COMPONENTS AND IS CONSIDERED TO BE
ONE RECEIPT REGARDLESS OF WHETHER IT IS SEPARATELY STATED FOR BILLING
PURPOSES. THE ENTIRE RECEIPT MUST BE ALLOCATED BY THIS HIERARCHY.
(C) HIERARCHY OF SOURCING METHODS. (1) DELIVERY DESTINATION OF THE
DIGITAL PRODUCT. A DIGITAL PRODUCT IS DEEMED DELIVERED WITHIN THE STATE
IF THE LOCATION FROM WHICH THE PURCHASER OR ITS AUTHORIZED USER ACCESSES
OR USES THE DIGITAL PRODUCT IS IN THE STATE. DESTINATION MAY BE DEMON-
STRATED BY INTERNET PROTOCOL ADDRESS OR OTHER SIMILAR OR SUCCESSOR INDI-
CATOR, THE GEOGRAPHIC LOCATION OF THE EQUIPMENT TO WHICH THE DIGITAL
PRODUCT IS DELIVERED OR FROM WHICH THE DIGITAL PRODUCT IS ACCESSED, OR
THE DELIVERY DESTINATION INDICATED ON A BILL OF LADING OR PURCHASE
INVOICE. A DIGITAL PRODUCT ACCESSED OR USED BY THE PURCHASER OR ITS
AUTHORIZED USER DURING THE TAXPAYER'S TAXABLE YEAR IN MULTIPLE LOCATIONS
IS DELIVERED WITHIN THE STATE TO THE EXTENT THAT THE DIGITAL PRODUCT IS
ACCESSED OR USED IN THE STATE;
(2) BILLING ADDRESS OF THE PURCHASER;
S. 6359 55 A. 8559
(3) ZIP CODE OR OTHER GEOGRAPHIC INDICATOR OF THE PURCHASER'S
LOCATION; OR
(4) THE APPORTIONMENT FRACTION DETERMINED PURSUANT TO THIS SUBDIVISION
FOR THE PRECEDING TAXABLE YEAR, OR, IF THE TAXPAYER WAS NOT SUBJECT TO
TAX IN THE PRECEDING TAXABLE YEAR, THEN THE APPORTIONMENT FRACTION IN
THE CURRENT TAXABLE YEAR FOR THOSE DIGITAL PRODUCTS THAT CAN BE SOURCED
USING THE HIERARCHY OF SOURCING METHODS IN SUBPARAGRAPHS ONE THROUGH
THREE OF THIS SUBDIVISION.
5. FINANCIAL TRANSACTIONS. (A) FINANCIAL INSTRUMENTS. A FINANCIAL
INSTRUMENT IS A "QUALIFIED FINANCIAL INSTRUMENT" IF IT IS MARKED TO
MARKET UNDER SECTION 475 OR SECTION 1256 OF THE INTERNAL REVENUE CODE,
PROVIDED THAT LOANS SECURED BY REAL PROPERTY SHALL NOT BE QUALIFIED
FINANCIAL INSTRUMENTS. A FINANCIAL INSTRUMENT IS A "NONQUALIFIED FINAN-
CIAL INSTRUMENT" IF IT IS NOT A QUALIFIED FINANCIAL INSTRUMENT.
(1) FIXED PERCENTAGE METHOD FOR QUALIFIED FINANCIAL INSTRUMENTS. IN
DETERMINING THE INCLUSION OF RECEIPTS AND NET GAINS FROM QUALIFIED
FINANCIAL INSTRUMENTS IN THE APPORTIONMENT FRACTION, TAXPAYERS MAY ELECT
TO USE THE FIXED PERCENTAGE METHOD DESCRIBED IN THIS SUBPARAGRAPH FOR
QUALIFIED FINANCIAL INSTRUMENTS. THE ELECTION IS IRREVOCABLE, APPLIES TO
ALL QUALIFIED FINANCIAL INSTRUMENTS, AND MUST BE MADE ON AN ANNUAL BASIS
ON THE TAXPAYER'S ORIGINAL, TIMELY FILED RETURN. IF THE TAXPAYER ELECTS
THE FIXED PERCENTAGE METHOD, THEN ALL INCOME, GAIN OR LOSS, FROM QUALI-
FIED FINANCIAL INSTRUMENTS CONSTITUTES BUSINESS INCOME, GAIN OR LOSS. IF
THE TAXPAYER DOES NOT ELECT TO USE THE FIXED PERCENTAGE METHOD, THEN
RECEIPTS AND NET GAINS ARE INCLUDED IN THE APPORTIONMENT FRACTION IN
ACCORDANCE WITH THE CUSTOMER SOURCING METHOD DESCRIBED IN SUBPARAGRAPH
TWO OF THIS PARAGRAPH. UNDER THE FIXED PERCENTAGE METHOD, EIGHT PERCENT
OF ALL NET INCOME (NOT LESS THAN ZERO) FROM QUALIFIED FINANCIAL INSTRU-
MENTS IS INCLUDED IN THE NUMERATOR OF THE APPORTIONMENT FRACTION. ALL
NET INCOME (NOT LESS THAN ZERO) FROM QUALIFIED FINANCIAL INSTRUMENTS IS
INCLUDED IN THE DENOMINATOR OF THE APPORTIONMENT FRACTION.
(2) CUSTOMER SOURCING METHOD. RECEIPTS AND NET GAINS FROM QUALIFIED
FINANCIAL INSTRUMENTS, IN CASES WHERE THE TAXPAYER DID NOT ELECT TO USE
THE FIXED PERCENTAGE METHOD DESCRIBED IN SUBPARAGRAPH ONE OF THIS PARA-
GRAPH, AND FROM NONQUALIFIED FINANCIAL INSTRUMENTS ARE INCLUDED IN THE
APPORTIONMENT FRACTION IN ACCORDANCE WITH THIS SUBPARAGRAPH. FOR
PURPOSES OF THIS PARAGRAPH, AN INDIVIDUAL IS DEEMED TO BE LOCATED IN THE
STATE IF HIS OR HER BILLING ADDRESS IS IN THE STATE. A BUSINESS ENTITY
IS DEEMED TO BE LOCATED IN THE STATE IF ITS COMMERCIAL DOMICILE IS
LOCATED IN THE STATE.
(A) LOANS. (I) RECEIPTS CONSTITUTING INTEREST FROM LOANS SECURED BY
REAL PROPERTY LOCATED WITHIN THE STATE SHALL BE INCLUDED IN THE NUMERA-
TOR OF THE APPORTIONMENT FRACTION. RECEIPTS CONSTITUTING INTEREST FROM
LOANS SECURED BY REAL PROPERTY LOCATED WITHIN AND WITHOUT THE STATE
SHALL BE INCLUDED IN THE DENOMINATOR OF THE APPORTIONMENT FRACTION.
(II) RECEIPTS CONSTITUTING INTEREST FROM LOANS NOT SECURED BY REAL
PROPERTY SHALL BE INCLUDED IN THE NUMERATOR OF THE APPORTIONMENT FRAC-
TION IF THE BORROWER IS LOCATED IN THE STATE. RECEIPTS CONSTITUTING
INTEREST FROM LOANS NOT SECURED BY REAL PROPERTY, WHETHER THE BORROWER
IS LOCATED WITHIN OR WITHOUT THE STATE, SHALL BE INCLUDED IN THE DENOMI-
NATOR OF THE APPORTIONMENT FRACTION.
(III) NET GAINS (NOT LESS THAN ZERO) FROM SALES OF LOANS SECURED BY
REAL PROPERTY ARE INCLUDED IN THE NUMERATOR OF THE APPORTIONMENT FRAC-
TION AS PROVIDED IN THIS SUBCLAUSE. THE AMOUNT OF NET GAINS FROM THE
SALE OF LOANS SECURED BY REAL PROPERTY INCLUDED IN THE NUMERATOR OF THE
APPORTIONMENT FRACTION IS DETERMINED BY MULTIPLYING THE NET GAINS BY A
S. 6359 56 A. 8559
FRACTION THE NUMERATOR OF WHICH IS THE AMOUNT OF GROSS PROCEEDS FROM
SALES OF LOANS SECURED BY REAL PROPERTY LOCATED WITHIN THE STATE AND THE
DENOMINATOR OF WHICH IS THE GROSS PROCEEDS FROM SALES OF LOANS SECURED
BY REAL PROPERTY WITHIN AND WITHOUT THE STATE. GROSS PROCEEDS SHALL BE
DETERMINED AFTER THE DEDUCTION OF ANY COST INCURRED TO ACQUIRE THE LOANS
BUT SHALL NOT BE LESS THAN ZERO. NET GAINS (NOT LESS THAN ZERO) FROM
SALES OF LOANS SECURED BY REAL PROPERTY WITHIN AND WITHOUT THE STATE ARE
INCLUDED IN THE DENOMINATOR OF THE APPORTIONMENT FRACTION.
(IV) NET GAINS (NOT LESS THAN ZERO) FROM SALES OF LOANS NOT SECURED BY
REAL PROPERTY ARE INCLUDED IN THE NUMERATOR OF THE APPORTIONMENT FRAC-
TION AS PROVIDED IN THIS SUBCLAUSE. THE AMOUNT OF NET GAINS FROM THE
SALE OF LOANS NOT SECURED BY REAL PROPERTY INCLUDED IN THE NUMERATOR OF
THE APPORTIONMENT FRACTION IS DETERMINED BY MULTIPLYING THE NET GAINS BY
A FRACTION, THE NUMERATOR OF WHICH IS THE AMOUNT OF GROSS PROCEEDS FROM
SALES OF LOANS NOT SECURED BY REAL PROPERTY TO PURCHASERS LOCATED WITHIN
THE STATE AND THE DENOMINATOR OF WHICH IS THE AMOUNT OF GROSS RECEIPTS
FROM SALES OF LOANS NOT SECURED BY REAL PROPERTY TO PURCHASERS LOCATED
WITHIN AND WITHOUT THE STATE. GROSS PROCEEDS SHALL BE DETERMINED AFTER
THE DEDUCTION OF ANY COST INCURRED TO ACQUIRE THE LOANS BUT SHALL NOT BE
LESS THAN ZERO. NET GAINS (NOT LESS THAN ZERO) FROM SALES OF LOANS NOT
SECURED BY REAL PROPERTY ARE INCLUDED IN THE DENOMINATOR OF THE APPOR-
TIONMENT FRACTION.
(B) FEDERAL, STATE, AND MUNICIPAL DEBT. RECEIPTS CONSTITUTING INTEREST
AND NET GAINS FROM SALES OF DEBT INSTRUMENTS ISSUED BY THE UNITED
STATES, ANY STATE, OR POLITICAL SUBDIVISION OF A STATE SHALL NOT BE
INCLUDED IN THE NUMERATOR OF THE APPORTIONMENT FRACTION. RECEIPTS
CONSTITUTING INTEREST AND NET GAINS (NOT LESS THAN ZERO) FROM SALES OF
DEBT INSTRUMENTS ISSUED BY THE UNITED STATES AND THE STATE OF NEW YORK
OR ITS POLITICAL SUBDIVISIONS SHALL BE INCLUDED IN THE DENOMINATOR OF
THE APPORTIONMENT FRACTION. FIFTY PERCENT OF THE RECEIPTS CONSTITUTING
INTEREST AND NET GAINS (NOT LESS THAN ZERO) FROM SALES OF DEBT INSTRU-
MENTS ISSUED BY OTHER STATES OR THEIR POLITICAL SUBDIVISIONS SHALL BE
INCLUDED IN THE DENOMINATOR OF THE APPORTIONMENT FRACTION.
(C) ASSET BACKED SECURITIES. EIGHT PERCENT OF THE INTEREST INCOME FROM
ASSET BACKED SECURITIES, INCLUDING SECURITIES ISSUED BY THE GOVERNMENT
NATIONAL MORTGAGE ASSOCIATION (GNMA), THE FEDERAL NATIONAL MORTGAGE
ASSOCIATION (FNMA), OR THE FEDERAL HOME LOAN MORTGAGE CORPORATION
(FHLMC), THE SMALL BUSINESS ADMINISTRATION OR OTHER GOVERNMENT AGENCY
SHALL BE INCLUDED IN THE NUMERATOR OF THE APPORTIONMENT FRACTION. EIGHT
PERCENT OF THE NET GAINS (NOT LESS THAN ZERO) FROM SALES OF ASSET BACKED
SECURITIES ISSUED BY GNMA, FNMA, OR FHLMC, THE SMALL BUSINESS ADMINIS-
TRATION OR OTHER GOVERNMENT AGENCY AND SALES OF OTHER ASSET BACKED SECU-
RITIES THAT ARE SOLD THROUGH A REGISTERED SECURITIES BROKER OR DEALER OR
THROUGH A LICENSED EXCHANGE SHALL BE INCLUDED IN THE NUMERATOR OF THE
APPORTIONMENT FRACTION. THE AMOUNT OF NET GAINS (NOT LESS THAN ZERO)
FROM SALES OF OTHER ASSET BACKED SECURITIES INCLUDED IN THE NUMERATOR OF
THE APPORTIONMENT FRACTION IS DETERMINED BY MULTIPLYING SUCH NET GAINS
BY A FRACTION, THE NUMERATOR OF WHICH IS THE AMOUNT OF GROSS PROCEEDS
FROM SUCH SALES TO PURCHASERS LOCATED IN THE STATE AND THE DENOMINATOR
OF WHICH IS THE AMOUNT OF GROSS PROCEEDS FROM SUCH SALES TO PURCHASERS
LOCATED WITHIN AND WITHOUT THE STATE. RECEIPTS CONSTITUTING INTEREST
FROM ASSET BACKED SECURITIES AND NET GAINS (NOT LESS THAN ZERO) FROM
SALES OF ASSET BACKED SECURITIES ARE INCLUDED IN THE DENOMINATOR OF THE
APPORTIONMENT FRACTION. GROSS PROCEEDS SHALL BE DETERMINED AFTER THE
DEDUCTION OF ANY COST TO ACQUIRE THE SECURITIES BUT SHALL NOT BE LESS
THAN ZERO.
S. 6359 57 A. 8559
(D) CORPORATE BONDS. RECEIPTS CONSTITUTING INTEREST FROM CORPORATE
BONDS ARE INCLUDED IN THE NUMERATOR OF THE APPORTIONMENT FRACTION IF THE
COMMERCIAL DOMICILE OF THE ISSUING CORPORATION IS IN THE STATE. EIGHT
PERCENT OF THE NET GAINS (NOT LESS THAN ZERO) FROM SALES OF CORPORATE
BONDS SOLD THROUGH A REGISTERED SECURITIES BROKER OR DEALER OR THROUGH A
LICENSED EXCHANGE IS INCLUDED IN THE NUMERATOR OF THE APPORTIONMENT
FRACTION. THE AMOUNT OF NET GAINS (NOT LESS THAN ZERO) FROM OTHER SALES
OF CORPORATE BONDS INCLUDED IN THE NUMERATOR OF THE APPORTIONMENT FRAC-
TION IS DETERMINED BY MULTIPLYING SUCH NET GAINS BY A FRACTION, THE
NUMERATOR OF WHICH IS THE AMOUNT OF GROSS PROCEEDS FROM SUCH SALES TO
PURCHASERS LOCATED IN THE STATE AND THE DENOMINATOR OF WHICH IS THE
AMOUNT OF GROSS PROCEEDS FROM SALES TO PURCHASERS LOCATED WITHIN AND
WITHOUT THE STATE. RECEIPTS CONSTITUTING INTEREST FROM CORPORATE BONDS,
WHETHER THE ISSUING CORPORATION'S COMMERCIAL DOMICILE IS WITHIN OR WITH-
OUT THE STATE, AND NET GAINS (NOT LESS THAN ZERO) FROM SALES OF CORPO-
RATE BONDS TO PURCHASERS WITHIN AND WITHOUT THE STATE ARE INCLUDED IN
THE DENOMINATOR OF THE APPORTIONMENT FRACTION. GROSS PROCEEDS SHALL BE
DETERMINED AFTER THE DEDUCTION OF ANY COST TO ACQUIRE THE BONDS BUT
SHALL NOT BE LESS THAN ZERO.
(E) REVERSE REPURCHASE AGREEMENTS AND SECURITIES BORROWING AGREEMENTS.
EIGHT PERCENT OF NET INTEREST INCOME (NOT LESS THAN ZERO) FROM REVERSE
REPURCHASE AGREEMENTS AND SECURITIES BORROWING AGREEMENTS SHALL BE
INCLUDED IN THE NUMERATOR OF THE APPORTIONMENT FRACTION. NET INTEREST
INCOME (NOT LESS THAN ZERO) FROM REVERSE REPURCHASE AGREEMENTS AND SECU-
RITIES BORROWING AGREEMENTS IS INCLUDED IN THE DENOMINATOR OF THE APPOR-
TIONMENT FRACTION. NET INTEREST INCOME FROM REVERSE REPURCHASE AGREE-
MENTS AND SECURITIES BORROWING AGREEMENTS IS DETERMINED FOR PURPOSES OF
THIS SUBDIVISION AFTER THE DEDUCTION OF THE INTEREST EXPENSE FROM THE
TAXPAYER'S REPURCHASE AGREEMENTS AND SECURITIES LENDING AGREEMENTS BUT
CANNOT BE LESS THAN ZERO. FOR THIS CALCULATION, THE AMOUNT OF SUCH
INTEREST EXPENSE IS THE INTEREST EXPENSE ASSOCIATED WITH THE SUM OF THE
VALUE OF THE TAXPAYER'S REPURCHASE AGREEMENTS WHERE IT IS THE
SELLER/BORROWER PLUS THE VALUE OF THE TAXPAYER'S AND SECURITIES LENDING
AGREEMENTS WHERE IT IS THE SECURITIES LENDER, PROVIDED SUCH SUM IS
LIMITED TO THE SUM OF THE VALUE OF THE TAXPAYER'S REVERSE REPURCHASE
AGREEMENTS WHERE IT IS THE SELLER/BORROWER AND THE VALUE OF THE TAXPAY-
ER'S SECURITIES BORROWING AGREEMENTS.
(F) FEDERAL FUNDS. EIGHT PERCENT OF THE NET INTEREST (NOT LESS THAN
ZERO) FROM FEDERAL FUNDS IS INCLUDED IN THE NUMERATOR OF THE APPORTION-
MENT FRACTION. THE NET INTEREST (NOT LESS THAN ZERO) FROM FEDERAL FUNDS
IS INCLUDED IN THE DENOMINATOR OF THE APPORTIONMENT FRACTION. NET INTER-
EST FROM FEDERAL FUNDS IS DETERMINED AFTER DEDUCTION OF INTEREST EXPENSE
FROM FEDERAL FUNDS.
(G) DIVIDENDS AND NET GAINS FROM SALES OF STOCK OR PARTNERSHIP INTER-
ESTS. DIVIDENDS FROM STOCK, NET GAINS (NOT LESS THAN ZERO) FROM SALES OF
STOCK AND NET GAINS (NOT LESS THAN ZERO) FROM THE SALE OF PARTNERSHIP
INTERESTS ARE NOT INCLUDED IN EITHER THE NUMERATOR OR DENOMINATOR OF THE
APPORTIONMENT FRACTION UNLESS THE COMMISSIONER DETERMINES PURSUANT TO
SUBDIVISION ELEVEN OF THIS SECTION THAT INCLUSION OF SUCH DIVIDENDS AND
NET GAINS (NOT LESS THAN ZERO) IS NECESSARY TO PROPERLY REFLECT THE
BUSINESS INCOME OR CAPITAL OF THE TAXPAYER.
(H) OTHER FINANCIAL INSTRUMENTS. (I) RECEIPTS CONSTITUTING INTEREST
FROM OTHER FINANCIAL INSTRUMENTS SHALL BE INCLUDED IN THE NUMERATOR OF
THE APPORTIONMENT FRACTION IF THE PAYOR IS LOCATED IN THE STATE.
RECEIPTS CONSTITUTING INTEREST FROM OTHER FINANCIAL INSTRUMENTS, WHETHER
S. 6359 58 A. 8559
THE PAYOR IS WITHIN OR WITHOUT THE STATE, ARE INCLUDED IN THE DENOMINA-
TOR OF THE APPORTIONMENT FRACTION.
(II) NET GAINS (NOT LESS THAN ZERO) FROM SALES OF OTHER FINANCIAL
INSTRUMENTS AND OTHER INCOME (NOT LESS THAN ZERO) FROM OTHER FINANCIAL
INSTRUMENTS WHERE THE PURCHASER OR PAYOR IS LOCATED IN THE STATE ARE
INCLUDED IN THE NUMERATOR OF THE APPORTIONMENT FRACTION, PROVIDED THAT,
IF THE PURCHASER OR PAYOR IS A REGISTERED SECURITIES BROKER OR DEALER OR
THE TRANSACTION IS MADE THROUGH A LICENSED EXCHANGE, THEN EIGHT PERCENT
OF THE NET GAINS (NOT LESS THAN ZERO) OR OTHER INCOME (NOT LESS THAN
ZERO) IS INCLUDED IN THE NUMERATOR OF THE APPORTIONMENT FRACTION. NET
GAINS (NOT LESS THAN ZERO) FROM SALES OF OTHER FINANCIAL INSTRUMENTS AND
OTHER INCOME (NOT LESS THAN ZERO) FROM OTHER FINANCIAL INSTRUMENTS ARE
INCLUDED IN THE DENOMINATOR OF THE APPORTIONMENT FRACTION.
(I) PHYSICAL COMMODITIES. NET INCOME (NOT LESS THAN ZERO) FROM SALES
OF PHYSICAL COMMODITIES ARE INCLUDED IN THE NUMERATOR OF THE APPORTION-
MENT FRACTION AS PROVIDED IN THIS SUBPARAGRAPH. THE AMOUNT OF NET INCOME
FROM SALES OF PHYSICAL COMMODITIES INCLUDED IN THE NUMERATOR OF THE
APPORTIONMENT FRACTION IS DETERMINED BY MULTIPLYING THE NET INCOME FROM
SALES OF PHYSICAL COMMODITIES BY A FRACTION, THE NUMERATOR OF WHICH IS
THE AMOUNT OF RECEIPTS FROM SALES OF PHYSICAL COMMODITIES ACTUALLY
DELIVERED TO POINTS WITHIN THE STATE OR, IF THERE IS NO ACTUAL DELIVERY
OF THE PHYSICAL COMMODITY, SOLD TO CUSTOMERS LOCATED IN THE STATE, AND
THE DENOMINATOR OF WHICH IS THE AMOUNT OF RECEIPTS FROM SALES OF PHYS-
ICAL COMMODITIES ACTUALLY DELIVERED TO POINTS WITHIN AND WITHOUT THE
STATE OR SOLD TO CUSTOMERS LOCATED WITHIN AND WITHOUT THE STATE. NET
INCOME (NOT LESS THAT ZERO) FROM SALES OF PHYSICAL COMMODITIES IS
INCLUDED IN THE DENOMINATOR OF THE APPORTIONMENT FRACTION. NET INCOME
(NOT LESS THAN ZERO) FROM SALES OF PHYSICAL COMMODITIES IS DETERMINED
AFTER THE DEDUCTION OF THE COST TO ACQUIRE OR PRODUCE THE PHYSICAL
COMMODITIES.
(B) OTHER RECEIPTS FROM BROKER OR DEALER ACTIVITIES. RECEIPTS FROM
SECURITIES OR COMMODITIES BROKER OR DEALER ACTIVITIES DESCRIBED IN THIS
PARAGRAPH SHALL BE DEEMED TO BE GENERATED WITHIN THE STATE AS DESCRIBED
IN SUBPARAGRAPHS ONE THROUGH EIGHT OF THIS PARAGRAPH. RECEIPTS FROM SUCH
ACTIVITIES GENERATED WITHIN THE STATE SHALL BE INCLUDED IN THE NUMERATOR
OF THE APPORTIONMENT FRACTION. RECEIPTS FROM SUCH ACTIVITIES GENERATED
WITHIN AND WITHOUT THE STATE SHALL BE INCLUDED IN THE DENOMINATOR OF THE
APPORTIONMENT FRACTION. FOR THE PURPOSES OF THIS PARAGRAPH, 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.
(1) 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 BE GENERATED WITHIN THE STATE
IF THE MAILING ADDRESS IN THE RECORDS OF THE TAXPAYER OF THE CUSTOMER
WHO IS RESPONSIBLE FOR PAYING SUCH COMMISSIONS IS WITHIN THE STATE.
(2) RECEIPTS CONSTITUTING MARGIN INTEREST EARNED ON BEHALF OF BROKER-
AGE ACCOUNTS SHALL BE DEEMED TO BE GENERATED WITHIN THE STATE IF THE
MAILING ADDRESS IN THE RECORDS OF THE TAXPAYER OF THE CUSTOMER WHO IS
RESPONSIBLE FOR PAYING SUCH MARGIN INTEREST IS WITHIN THE STATE.
(3)(A) 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 THAT IS CONTEMPLATING
ISSUING OR IS ISSUING SECURITIES) OR FEES EARNED BY THE TAXPAYER FOR
MANAGING AN UNDERWRITING SHALL BE DEEMED TO BE GENERATED WITHIN THE
S. 6359 59 A. 8559
STATE IF THE MAILING ADDRESS IN THE RECORDS OF THE TAXPAYER OF SUCH
CUSTOMER WHO IS RESPONSIBLE FOR PAYING SUCH FEES IS WITHIN THE STATE.
(B) RECEIPTS CONSTITUTING THE PRIMARY SPREAD OF SELLING CONCESSION
FROM UNDERWRITTEN SECURITIES SHALL BE DEEMED TO BE GENERATED WITHIN THE
STATE TO THE EXTENT THE CUSTOMER IS LOCATED IN THE STATE.
(C) 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 SECURI-
TIES 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 SEPA-
RATELY. 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.
(4) RECEIPTS CONSTITUTING ACCOUNT MAINTENANCE FEES SHALL BE DEEMED TO
BE GENERATED WITHIN THE STATE IF THE MAILING ADDRESS IN THE RECORD OF
THE TAXPAYER OF THE CUSTOMER WHO IS RESPONSIBLE FOR PAYING SUCH ACCOUNT
MAINTENANCE FEES IS WITHIN THE STATE.
(5) RECEIPTS CONSTITUTING FEES FOR MANAGEMENT OR ADVISORY SERVICES,
INCLUDING FEES FOR ADVISORY SERVICES IN RELATION TO MERGER OR ACQUISI-
TION ACTIVITIES, BUT EXCLUDING FEES PAID FOR SERVICES DESCRIBED IN PARA-
GRAPH (D) OF THIS SUBDIVISION, SHALL BE DEEMED TO BE GENERATED WITHIN
THE STATE IF THE MAILING ADDRESS IN THE RECORDS OF THE TAXPAYER OF THE
CUSTOMER WHO IS RESPONSIBLE FOR PAYING SUCH FEES IS WITHIN THE STATE.
(6) 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 TEN-C OF THIS
ARTICLE SHALL BE DEEMED TO ARISE FROM SERVICES PERFORMED AT THE PRINCI-
PAL PLACE OF BUSINESS OF SUCH AFFILIATED CORPORATION.
(7) IF THE TAXPAYER RECEIVES ANY OF THE RECEIPTS ENUMERATED IN SUBPAR-
AGRAPHS ONE THROUGH FOUR OF THIS PARAGRAPH AS A RESULT OF A SECURITIES
CORRESPONDENT RELATIONSHIP SUCH TAXPAYER HAS WITH ANOTHER BROKER OR
DEALER WITH THE TAXPAYER ACTING IN THIS RELATIONSHIP AS THE CLEARING
FIRM, SUCH RECEIPTS SHALL BE DEEMED TO BE GENERATED WITHIN THE STATE TO
EXTENT SET FORTH IN EACH OF SUCH SUBPARAGRAPHS. 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 SUBPARAGRAPHS ONE THROUGH
FOUR OF THIS PARAGRAPH AS AS RESULT OF A SECURITIES CORRESPONDENT
RELATIONSHIP SUCH TAXPAYER HAS WITH ANOTHER BROKER OR DEALER WITH THE
TAXPAYER ACTING IN THIS RELATIONSHIP AS THE INTRODUCING FIRM, SUCH
RECEIPTS SHALL BE DEEMED TO BE GENERATED WITHIN THE STATE TO THE EXTENT
SET FORTH IN EACH OF SUCH SUBPARAGRAPHS.
(8) IF, FOR PURPOSES OF SUBPARAGRAPHS ONE, TWO, CLAUSE (A) OF SUBPARA-
GRAPH THREE, FOUR, OR FIVE OF THIS PARAGRAPH THE TAXPAYER IS UNABLE FROM
ITS RECORDS TO DETERMINE THE MAILING ADDRESS OF THE CUSTOMER, EIGHT
PERCENT OF THE RECEIPTS IS INCLUDED IN THE NUMERATOR OF THE APPORTION-
MENT FRACTION.
(C) RECEIPTS FROM CREDIT CARD AND SIMILAR ACTIVITIES. RECEIPTS RELAT-
ING TO THE BANK, CREDIT, TRAVEL AND ENTERTAINMENT CARD ACTIVITIES
DESCRIBED IN THIS PARAGRAPH SHALL BE DEEMED TO BE GENERATED WITHIN THE
STATE AS DESCRIBED IN SUBPARAGRAPHS ONE THROUGH THREE OF THIS PARAGRAPH.
RECEIPTS FROM SUCH ACTIVITIES GENERATED WITHIN THE STATE SHALL BE
S. 6359 60 A. 8559
INCLUDED IN THE NUMERATOR OF THE APPORTIONMENT FRACTION. RECEIPTS FROM
SUCH ACTIVITIES GENERATED WITHIN AND WITHOUT THE STATE SHALL BE INCLUDED
IN THE DENOMINATOR OF THE APPORTIONMENT FRACTION.
(1) RECEIPTS CONSTITUTING INTEREST, AND FEES AND PENALTIES IN THE
NATURE OF INTEREST, FROM BANK, CREDIT, TRAVEL AND ENTERTAINMENT CARD
RECEIVABLES SHALL BE DEEMED TO BE GENERATED WITHIN THE STATE IF THE
MAILING ADDRESS OF THE CARD HOLDER IN THE RECORDS OF THE TAXPAYER IS IN
THE STATE;
(2) RECEIPTS FROM SERVICE CHARGES AND FEES FROM SUCH CARDS SHALL BE
DEEMED TO BE GENERATED WITHIN THE STATE IF THE MAILING ADDRESS OF THE
CARD HOLDER IN THE RECORDS OF THE TAXPAYER IS IN THE STATE; AND
(3) RECEIPTS FROM MERCHANT DISCOUNTS SHALL BE DEEMED TO BE GENERATED
WITHIN THE STATE IF THE MERCHANT IS LOCATED WITHIN THE STATE. IN THE
CASE OF A MERCHANT WITH LOCATIONS BOTH WITHIN AND WITHOUT NEW YORK
STATE, ONLY RECEIPTS FROM MERCHANT DISCOUNTS ATTRIBUTABLE TO SALES MADE
FROM LOCATIONS WITHIN NEW YORK STATE ARE ALLOCATED TO NEW YORK STATE. IT
SHALL BE PRESUMED THAT THE LOCATION OF THE MERCHANT IS THE ADDRESS OF
THE MERCHANT SHOWN ON THE INVOICE SUBMITTED BY THE MERCHANT TO THE
TAXPAYER.
(D) RECEIPTS FROM CERTAIN SERVICES TO INVESTMENT COMPANIES. RECEIPTS
RECEIVED FROM AN INVESTMENT COMPANY ARISING FROM THE SALE OF MANAGEMENT,
ADMINISTRATION OR DISTRIBUTION SERVICES TO SUCH INVESTMENT COMPANY ARE
INCLUDED IN THE DENOMINATOR OF THE APPORTIONMENT FRACTION. THE PORTION
OF SUCH RECEIPTS INCLUDED IN THE NUMERATOR OF THE APPORTIONMENT FRACTION
(SUCH PORTION REFERRED TO HEREIN AS THE NEW YORK PORTION) SHALL BE
DETERMINED AS PROVIDED IN THIS PARAGRAPH.
(1) THE NEW YORK PORTION SHALL BE THE PRODUCT OF THE TOTAL OF SUCH
RECEIPTS FROM THE SALE OF SUCH SERVICES AND A FRACTION. THE NUMERATOR OF
THAT FRACTION IS THE SUM OF THE MONTHLY PERCENTAGES (AS DEFINED HEREIN-
AFTER) 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 THE NUMBER OF SHARES IN
THE INVESTMENT COMPANY THAT ARE OWNED ON THE LAST DAY OF THE MONTH BY
SHAREHOLDERS THAT ARE DOMICILED IN THE STATE BY THE TOTAL NUMBER OF
SHARES IN THE INVESTMENT COMPANY OUTSTANDING ON THAT DATE. THE DENOMI-
NATOR OF THE FRACTION IS THE NUMBER OF SUCH MONTHLY PERCENTAGES.
(2)(A) FOR PURPOSES OF THIS PARAGRAPH, AN INDIVIDUAL, ESTATE OR TRUST
IS DEEMED TO BE LOCATED IN THE STATE IF HIS, HER OR ITS MAILING ADDRESS
ON THE RECORDS OF THE INVESTMENT COMPANY IS IN THE STATE. A BUSINESS
ENTITY IS DEEMED TO BE LOCATED IN THE STATE IF ITS COMMERCIAL DOMICILE
IS LOCATED IN THE STATE.
(B) FOR PURPOSES OF THIS PARAGRAPH, 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 CONSTI-
TUTE AN INVESTMENT COMPANY THAT ENDS WITHIN THE TAXABLE YEAR OF THE
TAXPAYER.
(C) FOR PURPOSES OF THIS PARAGRAPH THE TERM "RECEIPTS FROM AN INVEST-
MENT 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.
S. 6359 61 A. 8559
(D) FOR PURPOSES OF THIS PARAGRAPH, 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.
(E) FOR PURPOSES OF THIS PARAGRAPH, THE TERM "DISTRIBUTION SERVICES"
MEANS THE SERVICES OF ADVERTISING, SERVICING INVESTOR ACCOUNTS (INCLUD-
ING 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 COMPA-
NY) 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.
(F) FOR PURPOSES OF THIS PARAGRAPH, THE TERM "ADMINISTRATION SERVICES"
INCLUDES CLERICAL, ACCOUNTING, BOOKKEEPING, DATA PROCESSING, INTERNAL
AUDITING, LEGAL AND TAX SERVICES PERFORMED FOR AN INVESTMENT COMPANY BUT
ONLY 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 COMPA-
NY.
(E) FOR PURPOSES OF THIS SUBDIVISION, A TAXPAYER SHALL USE THE FOLLOW-
ING HIERARCHY TO DETERMINE THE COMMERCIAL DOMICILE OF A BUSINESS ENTITY,
BASED ON THE INFORMATION KNOWN TO THE TAXPAYER: (I) THE LOCATION OF THE
TREASURY FUNCTION OF THE BUSINESS ENTITY; (II) THE SEAT OF MANAGEMENT
AND CONTROL OF THE BUSINESS ENTITY; AND (III) THE BILLING ADDRESS OF THE
BUSINESS ENTITY IN THE TAXPAYER'S RECORDS. THE TAXPAYER MUST EXERCISE
DUE DILIGENCE BEFORE REJECTING A METHOD IN THIS HIERARCHY AND PROCEEDING
TO THE NEXT METHOD.
(F) FOR PURPOSES OF THIS SUBDIVISION, THE TERM "REGISTERED SECURITIES
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).
6. RECEIPTS FROM RAILROAD AND TRUCKING BUSINESS. RECEIPTS FROM 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 ARE INCLUDED IN THE NUMER-
ATOR OF THE APPORTIONMENT FRACTION AS FOLLOWS. THE AMOUNT OF RECEIPTS
FROM THE CONDUCT OF A RAILROAD BUSINESS OR A TRUCKING BUSINESS INCLUDED
IN THE NUMERATOR OF THE APPORTIONMENT FRACTION IS DETERMINED BY MULTI-
PLYING THE AMOUNT OF RECEIPTS FROM SUCH BUSINESS BY A FRACTION, THE
NUMERATOR OF WHICH IS THE MILES IN SUCH BUSINESS WITHIN THE STATE DURING
THE PERIOD COVERED BY THE TAXPAYER'S REPORT AND THE DENOMINATOR OF WHICH
IS THE MILES IN SUCH BUSINESS WITHIN AND WITHOUT THE STATE DURING SUCH
PERIOD. RECEIPTS FROM THE CONDUCT OF THE RAILROAD BUSINESS OR A TRUCK-
ING BUSINESS ARE INCLUDED IN THE DENOMINATOR OF THE APPORTIONMENT FRAC-
TION.
S. 6359 62 A. 8559
7. RECEIPTS FROM AVIATION SERVICES. (A) AIR FREIGHT FORWARDING.
RECEIPTS OF A TAXPAYER FROM THE ACTIVITY OF AIR FREIGHT FORWARDING
ACTING AS PRINCIPAL AND LIKE INDIRECT AIR CARRIER RECEIPTS ARISING FROM
SUCH ACTIVITY SHALL BE INCLUDED IN THE NUMERATOR OF THE APPORTIONMENT
FRACTION AS FOLLOWS: ONE HUNDRED PERCENT OF SUCH RECEIPTS IF BOTH THE
PICKUP AND DELIVERY ASSOCIATED WITH SUCH RECEIPTS ARE MADE IN THE STATE
AND FIFTY PERCENT OF SUCH RECEIPTS IF EITHER THE PICKUP OR DELIVERY
ASSOCIATED WITH SUCH RECEIPTS IS MADE IN THIS STATE. SUCH RECEIPTS,
WHETHER THE PICKUP OR DELIVERY ASSOCIATED WITH THE RECEIPTS IS WITHIN OR
WITHOUT THE STATE, SHALL BE INCLUDED IN THE DENOMINATOR OF THE APPOR-
TIONMENT FRACTION.
(B) OTHER AVIATION SERVICES. (1)(A) THE PORTION OF RECEIPTS OF A
TAXPAYER FROM AVIATION SERVICES (OTHER THAN SERVICES DESCRIBED IN PARA-
GRAPH (A) OF THIS SUBDIVISION) TO BE INCLUDED IN THE NUMERATOR OF THE
APPORTIONMENT FRACTION SHALL BE DETERMINED BY MULTIPLYING ITS RECEIPTS
FROM SUCH AVIATION SERVICES BY A PERCENTAGE WHICH IS EQUAL TO THE ARITH-
METIC 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 EMER-
GENCY 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 REVEN-
UE 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.
(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 TAXPAY-
ER; THE TERM "ORIGINATING REVENUE" MEANS REVENUE TO THE TAXPAYER FROM
THE TRANSPORTATION OR 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 ORIGI-
NATING OR CONNECTING TRAFFIC OR FINALLY DISCHARGED BY THE TAXPAYER AT
AIRPORTS;
S. 6359 63 A. 8559
(2) ALL SUCH RECEIPTS OF A TAXPAYER FROM AVIATION SERVICES DESCRIBED
IN THIS PARAGRAPH ARE INCLUDED IN THE DENOMINATOR OF THE APPORTIONMENT
FRACTION.
8. RECEIPTS FROM SALES OF ADVERTISING. (A) THE AMOUNT OF RECEIPTS FROM
SALES OF ADVERTISING IN NEWSPAPERS OR PERIODICALS INCLUDED IN THE NUMER-
ATOR OF THE APPORTIONMENT FRACTION IS DETERMINED BY MULTIPLYING THE
TOTAL OF SUCH RECEIPTS BY A FRACTION, THE NUMERATOR OF WHICH IS THE
NUMBER OF NEWSPAPERS AND PERIODICALS DELIVERED TO POINTS WITHIN THE
STATE AND THE DENOMINATOR OF WHICH IS THE NUMBER OF NEWSPAPERS AND PERI-
ODICALS DELIVERED TO POINTS WITHIN AND WITHOUT THE STATE. THE TOTAL OF
SUCH RECEIPTS FROM SALES OF ADVERTISING IN NEWSPAPERS OR PERIODICALS IS
INCLUDED IN THE DENOMINATOR OF THE APPORTIONMENT FRACTION.
(B) THE AMOUNT OF RECEIPTS FROM SALES OF ADVERTISING ON TELEVISION OR
RADIO INCLUDED IN THE APPORTIONMENT FRACTION IS DETERMINED BY MULTIPLY-
ING THE TOTAL OF SUCH RECEIPTS BY A FRACTION, THE NUMERATOR OF WHICH IS
THE NUMBER OF VIEWERS OR LISTENERS WITHIN THE STATE AND THE DENOMINATOR
OF WHICH IS THE NUMBER OF VIEWERS OR LISTENERS WITHIN AND WITHOUT THE
STATE. THE TOTAL OF SUCH RECEIPTS FROM SALES OF ADVERTISING ON TELE-
VISION AND RADIO IS INCLUDED IN THE DENOMINATOR OF THE APPORTIONMENT
FRACTION.
(C) THE AMOUNT OF RECEIPTS FROM SALES OF ADVERTISING NOT DESCRIBED IN
PARAGRAPH (A) OR (B) OF THIS SUBDIVISION THAT IS FURNISHED, PROVIDED OR
DELIVERED TO, OR ACCESSED BY THE VIEWER OR LISTENER THROUGH THE USE OF
WIRE, CABLE, FIBER-OPTIC, LASER, MICROWAVE, RADIO WAVE, SATELLITE OR
SIMILAR SUCCESSOR MEDIA OR ANY COMBINATION THEREOF, INCLUDED IN THE
NUMERATOR OF THE APPORTIONMENT FRACTION IS DETERMINED BY MULTIPLYING THE
TOTAL OF SUCH RECEIPTS BY A FRACTION, THE NUMERATOR OF WHICH IS THE
NUMBER OF VIEWERS OR LISTENERS WITHIN THE STATE AND THE DENOMINATOR OF
WHICH IS THE NUMBER OF VIEWERS OR LISTENERS WITHIN AND WITHOUT THE
STATE. THE TOTAL OF SUCH RECEIPTS FROM SALES OF ADVERTISING DESCRIBED IN
THIS PARAGRAPH IS INCLUDED IN THE DENOMINATOR OF THE APPORTIONMENT FRAC-
TION.
9. RECEIPTS FROM TRANSPORTATION OR TRANSMISSION OF GAS THROUGH PIPES.
RECEIPTS FROM THE TRANSPORTATION OR TRANSMISSION OF GAS THROUGH PIPES
ARE INCLUDED IN THE NUMERATOR OF THE APPORTIONMENT FRACTION AS FOLLOWS.
THE AMOUNT OF RECEIPTS FROM THE TRANSPORTATION OR TRANSMISSION OF GAS
THROUGH PIPES INCLUDED IN THE NUMERATOR OF THE APPORTIONMENT FRACTION IS
DETERMINED BY MULTIPLYING THE TOTAL AMOUNT OF SUCH RECEIPTS BY A FRAC-
TION, THE NUMERATOR OF WHICH IS THE TAXPAYER'S TRANSPORTATION UNITS
WITHIN THE STATE AND THE DENOMINATOR OF WHICH IS THE TAXPAYER'S TRANS-
PORTATION UNITS WITHIN AND WITHOUT THE STATE. A TRANSPORTATION UNIT IS
THE TRANSPORTATION OF ONE CUBIC FOOT OF GAS OVER A DISTANCE OF ONE MILE.
THE TOTAL AMOUNT OF RECEIPTS FROM THE TRANSPORTATION OR TRANSMISSION OF
GAS THROUGH PIPES IS INCLUDED IN THE DENOMINATOR OF THE APPORTIONMENT
FRACTION.
10. (A) RECEIPTS FROM OTHER SERVICES AND OTHER BUSINESS RECEIPTS.
RECEIPTS FROM SERVICES NOT ADDRESSED IN SUBDIVISIONS ONE THROUGH NINE OF
THIS SECTION AND OTHER BUSINESS RECEIPTS NOT ADDRESSED IN SUCH SUBDIVI-
SIONS SHALL BE INCLUDED IN THE NUMERATOR OF THE APPORTIONMENT FRACTION
IF THE LOCATION OF THE CUSTOMER IS WITHIN THE STATE. SUCH RECEIPTS FROM
CUSTOMERS WITHIN AND WITHOUT THE STATE ARE INCLUDED IN THE DENOMINATOR
OF THE APPORTIONMENT FRACTION. WHETHER THE RECEIPTS ARE INCLUDED IN THE
NUMERATOR OF THE APPORTIONMENT FRACTION IS DETERMINED ACCORDING TO THE
HIERARCHY OF METHOD SET FORTH IN PARAGRAPH (B) OF THIS SUBDIVISION. THE
TAXPAYER MUST EXERCISE DUE DILIGENCE UNDER EACH METHOD DESCRIBED IN
S. 6359 64 A. 8559
PARAGRAPH (B) BEFORE REJECTING IT AND PROCEEDING TO THE NEXT METHOD IN
THE HIERARCHY.
(B) HIERARCHY OF METHODS. (1) DELIVERY DESTINATION. RECEIPTS FOR
SERVICES PERFORMED FOR A CUSTOMER'S PARTICULAR LOCATION, SUCH AS WHERE A
DELIVERY IS MADE TO THAT LOCATION, AS MAY BE INDICATED ON A BILL OF
LADING OR PURCHASE INVOICE, ARE SOURCED TO THAT LOCATION.
(2) BILLING ADDRESS OF THE CUSTOMER.
(3) ZIP CODE OR OTHER GEOGRAPHIC INDICATOR OF THE CUSTOMER'S LOCATION.
(4) PERCENTAGE OF THE TAXPAYER'S RECEIPTS WITHIN THE STATE DETERMINED
PURSUANT TO THIS SUBDIVISION FOR THE PRECEDING TAXABLE YEAR OR, IF THE
TAXPAYER WAS NOT SUBJECT TO TAX IN THE PRECEDING TAXABLE YEAR, THEN THE
PERCENTAGE OF THE TAXPAYER'S RECEIPTS WITHIN THE STATE IN THE CURRENT
TAXABLE YEAR DETERMINED PURSUANT TO THIS SUBDIVISION.
11. IF IT SHALL APPEAR TO THE COMMISSIONER THAT THE APPORTIONMENT
FRACTION DETERMINED PURSUANT TO THIS SECTION DOES NOT RESULT IN A PROPER
REFLECTION OF THE TAXPAYER'S BUSINESS INCOME OR CAPITAL WITHIN THE
STATE, THE COMMISSIONER IS AUTHORIZED IN HIS OR HER DISCRETION TO ADJUST
IT BY (A) EXCLUDING ONE OR MORE ITEMS IN SUCH DETERMINATION, (B) INCLUD-
ING ONE OR MORE OTHER ITEMS IN SUCH DETERMINATION, OR (C) ANY OTHER
SIMILAR OR DIFFERENT METHOD CALCULATED TO EFFECT A FAIR AND PROPER
APPORTIONMENT OF THE BUSINESS INCOME AND CAPITAL REASONABLY ATTRIBUTED
TO THE STATE.
S 17. The tax law is amended by adding a new section 210-B to read as
follows:
S 210-B. CREDITS. 1. 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
PERCENT 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 CONSTI-
TUTES 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 INVEST-
MENT 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 FIVE
PERCENT WITH RESPECT TO THE FIRST THREE HUNDRED FIFTY MILLION DOLLARS OF
THE INVESTMENT CREDIT BASE, AND FOUR PERCENT WITH RESPECT TO THE INVEST-
MENT CREDIT BASE IN EXCESS OF THREE HUNDRED FIFTY MILLION DOLLARS,
EXCEPT IN THE CASE OF RESEARCH AND DEVELOPMENT PROPERTY AT THE OPTION OF
THE TAXPAYER THE APPLICABLE PERCENTAGE SHALL BE NINE.
(B) QUALIFYING PROPERTY. (I) A CREDIT SHALL BE ALLOWED UNDER THIS
SUBDIVISION TO A QUALIFIED NEW YORK MANUFACTURER, A QUALIFIED NEW YORK
AGRICULTURAL BUSINESS OR A QUALIFIED NEW YORK MINING BUSINESS WITH
RESPECT TO TANGIBLE PERSONAL PROPERTY AND OTHER TANGIBLE PROPERTY
S. 6359 65 A. 8559
INCLUDING BUILDINGS AND STRUCTURAL COMPONENTS OF BUILDINGS, WHICH (A)
ARE DEPRECIABLE PURSUANT TO SECTION ONE HUNDRED SIXTY-SEVEN OF THE
INTERNAL REVENUE CODE, (B) HAVE A USEFUL LIFE OF FOUR YEARS OR MORE, (C)
ARE ACQUIRED BY PURCHASE AS DEFINED IN SECTION ONE HUNDRED SEVENTY-NINE
(D) OF THE INTERNAL REVENUE CODE, (D) HAVE NOT BEEN PREVIOUSLY THE
SUBJECT OF AN INVESTMENT TAX CREDIT OR EMPIRE ZONE INVESTMENT CREDIT
ALLOWED TO ANOTHER TAXPAYER, (E) HAVE A SITUS IN THIS STATE AND (F) ARE
PRINCIPALLY USED BY THE TAXPAYER IN THE PRODUCTION OF GOODS FOR SALE OR
ARE RESEARCH AND DEVELOPMENT PROPERTY.
(II) FOR PURPOSES OF THIS PARAGRAPH, THE FOLLOWING DEFINITIONS SHALL
APPLY:
(A) PROPERTY USED IN THE PRODUCTION OF GOODS FOR SALE 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 FOR SALE
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 ORDI-
NARY 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 SIMI-
LAR PROJECTS.
(C) A QUALIFIED NEW YORK AGRICULTURAL BUSINESS SHALL MEAN A TAXPAYER
OR COMBINED GROUP PRINCIPALLY ENGAGED IN FARMING, AGRICULTURE, HORTICUL-
TURE, FLORICULTURE, VITICULTURE OR COMMERCIAL FISHING IN THE STATE. A
TAXPAYER OR A COMBINED GROUP IS PRINCIPALLY ENGAGED IN FARMING, AGRICUL-
TURE, HORTICULTURE, FLORICULTURE, VITICULTURE OR COMMERCIAL FISHING IN
THE STATE IF MORE THAN FIFTY PERCENT OF THE GROSS RECEIPTS OF THE
TAXPAYER OR THE COMBINED GROUP, RESPECTIVELY, DURING THE TAXABLE YEAR
ARE DERIVED FROM THE SALE OF GOODS PRODUCED BY ANY OF THE ACTIVITIES
SPECIFIED IN THIS SENTENCE THAT ARE CONDUCTED IN NEW YORK. IN COMPUTING
A COMBINED GROUP'S GROSS RECEIPTS, INTERCORPORATE RECEIPTS SHALL BE
ELIMINATED. IN COMPUTING GROSS RECEIPTS FOR A TAXPAYER THAT IS A PARTNER
IN PARTNERSHIP, INTER-ENTITY RECEIPTS BETWEEN THE TAXPAYER AND SUCH
PARTNERSHIP SHALL BE ELIMINATED.
(D) A QUALIFIED NEW YORK MINING BUSINESS SHALL MEAN A TAXPAYER OR
COMBINED GROUP PRINCIPALLY ENGAGED IN MINING IN THE STATE. A TAXPAYER OR
COMBINED GROUP IS PRINCIPALLY ENGAGED IN MINING IN THE STATE IF MORE
THAN FIFTY PERCENT OF THE GROSS RECEIPTS OF THE TAXPAYER OR THE COMBINED
GROUP, RESPECTIVELY, DURING THE TAXABLE YEAR ARE DERIVED FROM THE SALE
OF GOODS PRODUCED BY MINING ACTIVITIES THAT ARE CONDUCTED IN THE STATE.
IN COMPUTING A COMBINED GROUP'S GROSS RECEIPTS, INTERCORPORATE RECEIPTS
SHALL BE ELIMINATED. IN COMPUTING GROSS RECEIPTS FOR A TAXPAYER THAT IS
A PARTNER IN PARTNERSHIP, INTER-ENTITY RECEIPTS BETWEEN THE TAXPAYER AND
SUCH PARTNERSHIP SHALL BE ELIMINATED.
(III) IN ORDER TO PROPERLY ADMINISTER THE CREDIT AUTHORIZED BY THIS
SUBDIVISION, THE DEPARTMENT MAY DISCLOSE INFORMATION ABOUT THE ALLOWANCE
TO ANOTHER TAXPAYER OF AN INVESTMENT TAX CREDIT OR AN EMPIRE ZONE
INVESTMENT TAX CREDIT UNDER THIS CHAPTER WITH RESPECT TO THE SAME PROP-
ERTY.
(C) NONQUALIFYING PROPERTY. 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
S. 6359 66 A. 8559
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.
(D) CARRYOVER. 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 FIXED DOLLAR MINIMUM
AMOUNT PRESCRIBED IN PARAGRAPH (D) OF SUBDIVISION ONE OF SECTION TWO
HUNDRED TEN OF THIS ARTICLE. 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 AND NOT DEDUCT-
IBLE 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 (F) OF THIS SUBDIVI-
SION 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 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.
(E) RECAPTURE. (I) 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 PARAGRAPH, USEFUL LIFE OF PROPERTY
SHALL BE THE SAME AS THE TAXPAYER USES FOR DEPRECIATION PURPOSES WHEN
COMPUTING HIS FEDERAL INCOME TAX LIABILITY.
(II) EXCEPT WITH RESPECT TO THAT PROPERTY TO WHICH PARAGRAPH (IV) OF
THIS SUBDIVISION 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 ALLOWED 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
S. 6359 67 A. 8559
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.
(III) EXCEPT WITH RESPECT TO THAT PROPERTY TO WHICH PARAGRAPH (IV) OF
THIS SUBDIVISION 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.
(IV) 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 INTER-
NAL 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 INTER-
NAL REVENUE CODE.
(V) FOR PURPOSES OF THIS PARAGRAPH, PROPERTY (I) WHICH IS DESCRIBED IN
SUBPARAGRAPH (II), (III) OR (IV) 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 ARTICLE, 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.
(VI) FOR EACH TAXABLE YEAR, 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 PURSUANT TO SUBSECTION
(E) OF SECTION ONE THOUSAND NINETY-SIX, IN EFFECT ON THE LAST DAY OF THE
TAXABLE YEAR.
(VII) 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
S. 6359 68 A. 8559
FINANCING (WITHIN THE MEANING OF SECTION 46(C)(8) OF THE INTERNAL REVEN-
UE 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.
(VIII)(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 OTHER-
WISE 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 TRANSFE-
ROR 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 TAXPAY-
ER 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 DIVI-
SIONS OF THE TRANSFEROR ARE TRANSFERRED TO THE TAXPAYER IN A TRANSACTION
TO WHICH SECTION 351 OF SUCH CODE APPLIES, AND (II) STOCK OR SECURITIES
S. 6359 69 A. 8559
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 SUBPARA-
GRAPH, THE TAXPAYER MAY TREAT THE AMOUNT OF SUCH CREDIT AS AN OVERPAY-
MENT 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. SUCH
CREDIT SHALL BE ALLOWED AGAINST THE TAX IMPOSED BY THIS ARTICLE WITH
RESPECT TO THE SECOND SUCCEEDING TAXABLE YEAR NEXT FOLLOWING THE TRANS-
ACTION YEAR, PROVIDED THAT NOT MORE THAN ONE-FOURTH OF THE AMOUNT OF
SUCH CREDIT MAY BE APPLIED BY THE TAXPAYER, WHETHER TO REDUCE TAX OTHER-
WISE 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.
(F) NEW BUSINESS. FOR PURPOSES OF PARAGRAPH (D) OF THIS SUBDIVISION, A
NEW BUSINESS SHALL INCLUDE ANY CORPORATION, EXCEPT A CORPORATION WHICH:
(I) 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 OR
ONE HUNDRED EIGHTY-FOUR OF ARTICLE NINE; OR ARTICLE THIRTY-THREE OF THIS
CHAPTER; OR
(II) IS SUBSTANTIALLY SIMILAR IN OPERATION AND IN OWNERSHIP TO A BUSI-
NESS ENTITY (OR ENTITIES) TAXABLE, OR PREVIOUSLY TAXABLE, UNDER THIS
ARTICLE; SECTION ONE HUNDRED EIGHTY-THREE, ONE HUNDRED EIGHTY-FOUR,
FORMER SECTION ONE HUNDRED EIGHTY-FIVE OR FORMER SECTION ONE HUNDRED
EIGHTY-SIX OF ARTICLE NINE; ARTICLE THIRTY-TWO OF THIS CHAPTER (AS SUCH
ARTICLE WAS IN EFFECT ON DECEMBER THIRTY-FIRST, TWO THOUSAND FOURTEEN);
ARTICLE THIRTY-THREE OF THIS CHAPTER; ARTICLE TWENTY-THREE OF THIS CHAP-
TER 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) INCLUDA-
BLE UNDER ARTICLE TWENTY-TWO OF THIS CHAPTER WHEREBY THE INTENT AND
PURPOSE OF THIS PARAGRAPH AND PARAGRAPH (D) OF THIS SUBDIVISION WITH
RESPECT TO REFUNDING OF CREDIT TO NEW BUSINESS WOULD BE EVADED; OR
(III) HAS BEEN SUBJECT TO TAX UNDER THIS ARTICLE OR UNDER FORMER ARTI-
CLE THIRTY-TWO OF THIS CHAPTER FOR MORE THAN FIVE TAXABLE YEARS (EXCLUD-
ING SHORT TAXABLE YEARS).
2. EMPLOYMENT INCENTIVE CREDIT (EIC). (A)(I) APPLICATION OF CREDIT.
WHERE A TAXPAYER IS ALLOWED A CREDIT UNDER SUBDIVISION ONE OF THIS
SECTION, OTHER THAN AT THE OPTIONAL RATE APPLICABLE TO RESEARCH AND
DEVELOPMENT PROPERTY, THE TAXPAYER SHALL BE ALLOWED A CREDIT FOR EACH OF
THE TWO YEARS NEXT SUCCEEDING THE TAXABLE YEAR FOR WHICH THE CREDIT
S. 6359 70 A. 8559
UNDER SUCH SUBDIVISION ONE 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 ONE. PROVIDED,
HOWEVER, THAT THE CREDIT ALLOWABLE UNDER THIS SUBDIVISION FOR ANY TAXA-
BLE 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 ONE 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 ONE OF THIS SECTION IS ALLOWED, THE EMPLOYMENT BASE YEAR
SHALL BE THE TAXABLE YEAR IN WHICH THE CREDIT UNDER SUCH SUBDIVISION ONE
IS ALLOWED.
(II) AMOUNT OF CREDIT. THE AMOUNT OF THE CREDIT ALLOWED UNDER THIS
SUBDIVISION SHALL BE AS SET FORTH IN THE FOLLOWING TABLE:
AVERAGE NUMBER OF EMPLOYEES DURING THE CREDIT ALLOWED UNDER THIS
TAXABLE YEAR EXPRESSED AS A PERCENTAGE SUBDIVISION EXPRESSED AS A
OF AVERAGE EMPLOYEES IN EMPLOYMENT PERCENTAGE OF THE APPLICABLE
BASE YEARS INVESTMENT CREDIT BASIS
LESS THAN 102% 1.5%
AT LEAST 102% AND LESS THAN 103% 2%
AT LEAST 103% 2.5%
(B) AVERAGE NUMBER OF EMPLOYEES. 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. HOWEVER,
WITH RESPECT TO THE EMPLOYMENT BASE YEAR, THERE SHALL BE EXCLUDED THERE-
FROM ANY EMPLOYEE WITH RESPECT TO WHOM A CREDIT PROVIDED FOR UNDER
SUBDIVISION SIX 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) CARRYOVER. IN NO EVENT SHALL THE CREDIT HEREIN PROVIDED FOR BE
ALLOWED IN AN AMOUNT WHICH WILL REDUCE THE TAX PAYABLE TO LESS THAN THE
FIXED DOLLAR MINIMUM AMOUNT PRESCRIBED IN PARAGRAPH (D) OF SUBDIVISION
ONE OF SECTION TWO HUNDRED TEN OF THIS ARTICLE. 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 IMMEDIATE-
LY FOLLOWING SUCH TAXABLE YEAR AND MAY BE DEDUCTED FROM THE TAXPAYER'S
TAX FOR SUCH YEAR OR YEARS.
3. 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 CRED-
IT 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
S. 6359 71 A. 8559
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 SUBSE-
QUENTLY, 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) QUALIFIED PROPERTY. A CREDIT SHALL BE ALLOWED UNDER THIS SUBDIVI-
SION WITH RESPECT TO TANGIBLE PERSONAL PROPERTY AND OTHER TANGIBLE PROP-
ERTY, 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, VITICUL-
TURE 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, ASSUMP-
TION, 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 TAXPAYER 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 ADVISERS ACT OF 1940, AS AMENDED,
AND
S. 6359 72 A. 8559
(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 OF ONE HUNDRED MILLION DOLLARS, 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 SECURI-
TIES EXCHANGES OR BOARDS OR TRADE AND THAT PROVIDES AUTOMATION OR TECH-
NICAL SERVICES THERETO.
(VI) FOR PURPOSES OF CLAUSES (D), (E), (E-1) AND (F) OF SUBPARAGRAPH
(V) OF THIS PARAGRAPH, 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 OR 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), (E) AND (E-1) OF SUBPARA-
GRAPH (V) OF THIS PARAGRAPH MAY BE AGGREGATED. IN ADDITION, THE USES BY
THE TAXPAYER, ITS AFFILIATED REGULATED BROKER, DEALER AND REGISTERED
INVESTMENT ADVISER UNDER 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 SUBPARAGRAPH (V) OF THIS PARAGRAPH
UNLESS
(I) EIGHTY PERCENT OR MORE OF THE EMPLOYEES PERFORMING THE ADMINISTRA-
TIVE 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 ADMINISTRATIVE
AND SUPPORT FUNCTIONS RESULTING FROM OR RELATED TO THE QUALIFYING 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, OR
(III) THE NUMBER OF EMPLOYEES LOCATED IN THIS STATE DURING THE TAXABLE
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.
(VII) FOR THE PURPOSES OF CLAUSE (III) OF SUBPARAGRAPH (VI) OF THIS
PARAGRAPH 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 EMPLOYMENT TEST OR THIS EMPLOYMENT TEST MUST BE SATISFIED
THROUGH THE AGGREGATION OF THE EMPLOYEES OF THE TAXPAYER, ITS AFFILIATED
S. 6359 73 A. 8559
REGULATED BROKER, DEALER, AND REGISTERED INVESTMENT ADVISER USING THE
PROPERTY.
(VIII) FOR THE PURPOSE OF THIS SUBDIVISION, THE TERM "GOODS" SHALL NOT
INCLUDE ELECTRICITY.
(IX) FOR PURPOSES OF THIS SUBDIVISION, "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 MACHIN-
ERY, 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
SUBDIVISION, 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 (IV) OF PARAGRAPH (B) OF SUBDIVISION ONE
OF THIS SECTION, AND THE PROVISIONS OF SUBPARAGRAPH (V) OF SUCH PARA-
GRAPH (B) SHALL APPLY.
(C) NONQUALIFIED PROPERTY. 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 COMPO-
NENTS OF BUILDINGS, WHICH IT LEASES TO ANY OTHER PERSON OR CORPORATION
EXCEPT WHERE A TAXPAYER LEASES PROPERTY TO AN AFFILIATED REGULATED
BROKER, DEALER, REGISTERED INVESTMENT ADVISER, 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), (E-1) OR (F) OF SUBPARA-
GRAPH (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 INTER-
NAL REVENUE CODE, AS SUCH PARAGRAPH WAS IN EFFECT FOR AGREEMENTS ENTERED
INTO PRIOR TO JANUARY FIRST, NINETEEN HUNDRED EIGHTY-FOUR, SHALL BE
DISREGARDED.
(D) CARRYOVER. THE CREDIT ALLOWED UNDER THIS SUBDIVISION FOR ANY TAXA-
BLE YEAR SHALL NOT REDUCE THE TAX DUE FOR SUCH YEAR TO LESS THAN THE
FIXED DOLLAR MINIMUM AMOUNT PRESCRIBED IN PARAGRAPH (D) OF SUBDIVISION
ONE OF SECTION TWO HUNDRED TEN OF THIS ARTICLE. 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 BUSI-
NESS UNDER PARAGRAPH (F) OF SUBDIVISION ONE 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 ONE THOUSAND EIGHTY-SIX OF THIS CHAPTER. IN ADDI-
TION, ANY TAXPAYER WHICH IS APPROVED AS THE OWNER OF A QUALIFIED INVEST-
MENT PROJECT OR A SIGNIFICANT CAPITAL INVESTMENT PROJECT PURSUANT TO
S. 6359 74 A. 8559
SUBDIVISION (W) OF SECTION NINE HUNDRED FIFTY-NINE OF THE GENERAL MUNIC-
IPAL LAW, ON ITS REPORT FOR ITS TAXABLE YEAR WITH RESPECT TO WHICH SUCH
CREDIT IS ALLOWED, IN LIEU OF SUCH CARRYOVER, MAY ELECT TO TREAT FIFTY
PERCENT OF THE AMOUNT OF SUCH CARRYOVER WHICH IS ATTRIBUTABLE TO THE
CREDIT ALLOWED UNDER THIS SUBDIVISION FOR PROPERTY WHICH IS PART OF SUCH
PROJECT AS AN OVERPAYMENT OF TAX TO BE CREDITED OR REFUNDED IN ACCORD-
ANCE WITH THE PROVISIONS OF SECTION ONE THOUSAND EIGHTY-SIX OF THIS
CHAPTER. PROVIDED, HOWEVER, SUCH OWNER SHALL BE ALLOWED SUCH REFUND FOR
A MAXIMUM OF TEN TAXABLE YEARS WITH RESPECT TO SUCH QUALIFIED INVESTMENT
PROJECT AND EACH SIGNIFICANT CAPITAL INVESTMENT PROJECT, STARTING WITH
THE FIRST TAXABLE YEAR IN WHICH PROPERTY COMPRISING SUCH PROJECT IS
PLACED IN SERVICE. PROVIDED, FURTHER, HOWEVER, THE PROVISIONS OF
SUBSECTION (C) OF SECTION ONE THOUSAND EIGHTY-EIGHT OF THIS CHAPTER
NOTWITHSTANDING, NO INTEREST SHALL BE PAID THEREON.
(D-1) ANY CARRYOVER OF A CREDIT FROM PRIOR TAXABLE YEARS WILL NOT BE
ALLOWED IF AN EMPIRE ZONE RETENTION CERTIFICATE IS NOT ISSUED PURSUANT
TO SUBDIVISION (W) OF SECTION NINE HUNDRED FIFTY-NINE OF THE GENERAL
MUNICIPAL LAW TO THE EMPIRE ZONE ENTERPRISE WHICH IS THE BASIS OF THE
CREDIT.
(E) AT THE OPTION OF THE TAXPAYER, THE TAXPAYER MAY CHOOSE TO CLAIM
THE CREDIT DESCRIBED IN PARAGRAPH (A) OF THIS SUBDIVISION FOR PROPERTY
WHICH ALSO QUALIFIES FOR THE CREDIT PROVIDED UNDER SUBDIVISION ONE OF
THIS SECTION. A TAXPAYER SHALL NOT BE ALLOWED A CREDIT UNDER THIS SUBDI-
VISION WITH RESPECT TO ANY PROPERTY DESCRIBED IN PARAGRAPH (A) OF THIS
SUBDIVISION IF A CREDIT IS TAKEN PURSUANT TO SUBDIVISION ONE OF THIS
SECTION.
(F) RECAPTURE. (I) 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 PROP-
ERTY SHALL BE THE SAME AS THE TAXPAYER USES FOR DEPRECIATION PURPOSES
WHEN COMPUTING HIS FEDERAL INCOME TAX LIABILITY.
(II) EXCEPT WITH RESPECT TO THAT PROPERTY TO WHICH SUBPARAGRAPH (IV)
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
S. 6359 75 A. 8559
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 DETER-
MINED BY MULTIPLYING THE ORIGINAL CREDIT BY THE RATIO WHICH THE MONTHS
OF QUALIFIED USE BEAR TO THIRTY-SIX.
(III) EXCEPT WITH RESPECT TO THAT PROPERTY TO WHICH SUBPARAGRAPH (IV)
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 DISPOSI-
TION. THE AMOUNT OF CREDIT ALLOWED FOR ACTUAL USE SHALL BE DETERMINED BY
MULTIPLYING THE ORIGINAL CREDIT BY THE RATIO WHICH THE MONTHS OF QUALI-
FIED USE BEAR TO SIXTY.
(IV) 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 INTER-
NAL 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 INTER-
NAL REVENUE CODE.
(V) FOR PURPOSES OF THIS PARAGRAPH, DISPOSAL OR CESSATION OF QUALIFIED
USE SHALL NOT BE DEEMED TO HAVE OCCURRED SOLELY BY REASON OF THE TERMI-
NATION OR EXPIRATION OF AN EMPIRE ZONE'S DESIGNATION AS SUCH.
(VI)(A) FOR PURPOSES OF THIS PARAGRAPH, THE DECERTIFICATION OF A BUSI-
NESS 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 DECERTIF-
ICATION APPLIES, ON THE EFFECTIVE DATE OF SUCH DECERTIFICATION.
(B) WHERE A BUSINESS ENTERPRISE HAS BEEN DECERTIFIED BASED ON A FIND-
ING 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.
S. 6359 76 A. 8559
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 ONE 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.
(VII) FOR PURPOSES OF THIS PARAGRAPH, WHERE A CREDIT IS ALLOWED WITH
RESPECT TO AN AIR POLLUTION CONTROL FACILITY ON THE BASIS OF A CERTIF-
ICATE 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 CESSA-
TION 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.
(VIII) 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 PART-
NERSHIP IN AN EMPIRE ZONE THE BASIS FOR FEDERAL INCOME TAX PURPOSES FOR
SUCH PROPERTY (OR A PROJECT THAT INCLUDES SUCH PROPERTY) EQUALED OR
EXCEEDED THREE HUNDRED MILLION DOLLARS AND SUCH PARTNER OWNED ITS PART-
NERSHIP 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 PART-
NER IN THE YEAR SUCH PROPERTY CEASES TO BE IN QUALIFYING USE.
(IX) IF A TAXPAYER, WHICH IS APPROVED BY THE COMMISSIONER OF ECONOMIC
DEVELOPMENT AS THE OWNER OF A QUALIFIED INVESTMENT PROJECT OR A SIGNIF-
ICANT CAPITAL INVESTMENT PROJECT PURSUANT TO SUBDIVISION (W) OF SECTION
NINE HUNDRED FIFTY-NINE OF THE GENERAL MUNICIPAL LAW, FAILS TO (A)
CREATE AT LEAST THE MINIMUM NUMBER OF JOBS AT SUCH PROJECT AS REQUIRED
BY THE PROVISIONS OF SUBDIVISION (S) OR (T) OF SECTION NINE HUNDRED
FIFTY-SEVEN AND SUBDIVISION (W) OF SECTION NINE HUNDRED FIFTY-NINE OF
THE GENERAL MUNICIPAL LAW OR (B) PLACE IN SERVICE PROPERTY COMPRISING
SUCH QUALIFIED INVESTMENT PROJECT OR SIGNIFICANT CAPITAL INVESTMENT
PROJECT WITH A BASIS FOR FEDERAL INCOME TAX PURPOSES EQUALING OR EXCEED-
ING THE APPLICABLE MINIMUM REQUIRED BASIS AS PROVIDED IN SUCH SUBDIVI-
SION (S) OR (T), WHICHEVER IS RELEVANT, BY THE LAST DAY OF THE FIFTH
TAXABLE YEAR FOLLOWING THE TAXABLE YEAR IN WHICH A CREDIT IS FIRST
S. 6359 77 A. 8559
ALLOWED UNDER THIS SUBDIVISION FOR THE PROPERTY WHICH COMPRISES SUCH
QUALIFIED INVESTMENT PROJECT OR SUCH SIGNIFICANT CAPITAL INVESTMENT
PROJECT, THE TOTAL AMOUNT OF THE CREDIT ALLOWED UNDER THIS SUBDIVISION
FOR ALL TAXABLE YEARS WITH RESPECT TO THE PROPERTY WHICH COMPRISES SUCH
PROJECT WHICH HAS BEEN REFUNDED TO SUCH TAXPAYER SHALL BE ADDED BACK IN
SUCH TAXABLE YEAR.
(G) NOTWITHSTANDING THE EXPIRATION OF THE EMPIRE ZONES PROGRAM UNDER
ARTICLE EIGHTEEN-B OF THE GENERAL MUNICIPAL LAW, A TAXPAYER THAT IS
CERTIFIED AS A QUALIFIED INVESTMENT PROJECT PURSUANT TO SUCH ARTICLE
EIGHT-B ON THE DAY IMMEDIATELY PRECEDING THE DAY THE EMPIRE ZONES
PROGRAM EXPIRED SHALL CONTINUE TO BE DEEMED CERTIFIED UNDER SUCH ARTICLE
EIGHTEEN-B FOR PURPOSES OF THIS SUBDIVISION FOR THE REMAINDER OF THE
TAXABLE YEAR IN WHICH THE EXPIRATION OCCURRED AND FOR THE NEXT SUCCEED-
ING NINE TAXABLE YEARS. IN ADDITION, THE AREAS DESIGNATED AS EMPIRE
ZONES IN WHICH THE TAXPAYER IS CERTIFIED AS A QUALIFIED INVESTMENT
PROJECT ON THE DAY IMMEDIATELY PRECEDING THE DAY THE EMPIRE ZONES
PROGRAM EXPIRED SHALL CONTINUE TO BE DEEMED EMPIRE ZONES FOR PURPOSES OF
THIS SUBDIVISION FOR THE REMAINDER OF THE TAXABLE YEAR IN WHICH THE
EXPIRATION OCCURRED AND FOR THE NEXT SUCCEEDING NINE TAXABLE YEARS.
(H) NOTWITHSTANDING THE EXPIRATION OF THE EMPIRE ZONES PROGRAM UNDER
ARTICLE EIGHTEEN-B OF THE GENERAL MUNICIPAL LAW AND EXCEPT AS PROVIDED
IN PARAGRAPH (G) OF THIS SUBDIVISION, A TAXPAYER THAT IS CERTIFIED AS AN
EMPIRE ZONE BUSINESS PURSUANT TO SUCH ARTICLE EIGHTEEN-B ON THE DAY
IMMEDIATELY PRECEDING THE DAY THE EMPIRE ZONE PROGRAM EXPIRED SHALL
CONTINUE TO BE DEEMED CERTIFIED UNDER SUCH ARTICLE EIGHTEEN-B FOR
PURPOSES OF THIS SUBDIVISION UNTIL APRIL FIRST, TWO THOUSAND FOURTEEN.
IN ADDITION, THE AREAS DESIGNATED AS EMPIRE ZONES IN WHICH THE TAXPAYER
IS CERTIFIED AS AN EMPIRE ZONE BUSINESS ON THE DAY IMMEDIATELY PRECEDING
THE DAY THE EMPIRE ZONES PROGRAM EXPIRED SHALL CONTINUE TO BE DEEMED
EMPIRE ZONES FOR PURPOSES OF THIS SUBDIVISIONS UNTIL APRIL FIRST, TWO
THOUSAND FOURTEEN.
4. EMPIRE ZONE EMPLOYMENT INCENTIVE CREDIT (EZ-EIC). (A) APPLICATION
OF CREDIT. WHERE A TAXPAYER IS ALLOWED A CREDIT UNDER SUBDIVISION THREE
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 THREE IS ALLOWED, WITH RESPECT TO SUCH PROPERTY, WHETH-
ER OR NOT DEDUCTIBLE IN SUCH TAXABLE YEAR OR IN SUBSEQUENT TAXABLE YEARS
PURSUANT TO PARAGRAPH (D) OF SUCH SUBDIVISION THREE, OF THIRTY PERCENT
OF THE CREDIT ALLOWABLE UNDER SUCH SUBDIVISION THREE; 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, DURING
THE TAXABLE YEAR IMMEDIATELY PRECEDING THE TAXABLE YEAR FOR WHICH THE
CREDIT UNDER SUCH SUBDIVISION THREE 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 THREE 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 THREE
IS ALLOWED.
S. 6359 78 A. 8559
(B) AVERAGE NUMBER OF EMPLOYEES. THE AVERAGE NUMBER OF EMPLOYEES
EMPLOYED IN AN EMPIRE ZONE IN A TAXABLE YEAR SHALL BE COMPUTED BY ASCER-
TAINING THE NUMBER OF SUCH EMPLOYEES WITHIN 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.
(C) CARRYOVER. IN NO EVENT SHALL THE CREDIT HEREIN PROVIDED FOR BE
ALLOWED IN AN AMOUNT WHICH WILL REDUCE THE TAX PAYABLE TO LESS THAN THE
FIXED DOLLAR MINIMUM AMOUNT PRESCRIBED IN PARAGRAPH (D) OF SUBDIVISION
ONE OF SECTION TWO HUNDRED TEN OF THIS ARTICLE. 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 APPROVED AS THE
OWNER OF A QUALIFIED INVESTMENT PROJECT OR A SIGNIFICANT CAPITAL INVEST-
MENT PROJECT PURSUANT TO SUBDIVISION (V) OF SECTION NINE HUNDRED FIFTY-
NINE OF THE GENERAL MUNICIPAL LAW, 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
ONE THOUSAND EIGHTY-SIX OF THIS CHAPTER. PROVIDED, HOWEVER, IN THE CASE
OF SUCH OWNER OF A QUALIFIED INVESTMENT PROJECT OR A SIGNIFICANT CAPITAL
INVESTMENT PROJECT, ONLY FIFTY PERCENT OF THE AMOUNT OF SUCH CARRYOVER
WHICH IS ATTRIBUTABLE TO THE CREDIT ALLOWED UNDER THIS SUBDIVISION WITH
RESPECT TO PROPERTY WHICH IS PART OF SUCH PROJECT SHALL BE ALLOWED TO BE
CREDITED OR REFUNDED AND SUCH OWNER SHALL BE ALLOWED SUCH CREDIT OR
REFUND ONLY FOR THOSE TAXABLE YEARS IN WHICH SUCH OWNER WOULD BE ALLOWED
A CREDIT OR REFUND OF THE EMPIRE ZONE INVESTMENT TAX CREDIT PURSUANT TO
PARAGRAPH (D) OF SUBDIVISION THREE OF THIS SECTION. PROVIDED, FURTHER,
HOWEVER, THE PROVISIONS OF SUBSECTION (C) OF SECTION ONE THOUSAND EIGHT-
Y-EIGHT OF THIS CHAPTER NOTWITHSTANDING, NO INTEREST SHALL BE PAID THER-
EON.
(C-1) ANY CARRYOVER OF A CREDIT FROM PRIOR TAXABLE YEARS WILL NOT BE
ALLOWED IF AN EMPIRE ZONE RETENTION CERTIFICATE IS NOT ISSUED PURSUANT
TO SUBDIVISION (W) OF SECTION NINE HUNDRED FIFTY-NINE OF THE GENERAL
MUNICIPAL LAW TO THE EMPIRE ZONE ENTERPRISE WHICH IS THE BASIS OF THE
CREDIT.
(D) NOTWITHSTANDING THE EXPIRATION OF THE EMPIRE ZONES PROGRAM UNDER
ARTICLE EIGHTEEN-B OF THE GENERAL MUNICIPAL LAW, A TAXPAYER THAT IS
CERTIFIED AS A QUALIFIED INVESTMENT PROJECT PURSUANT TO SUCH ARTICLE
EIGHTEEN-B ON THE DAY IMMEDIATELY PRECEDING THE DAY THE EMPIRE ZONES
PROGRAM EXPIRED SHALL CONTINUE TO BE DEEMED CERTIFIED UNDER SUCH ARTICLE
EIGHTEEN-B FOR PURPOSES OF THIS SUBDIVISION FOR THE REMAINDER OF THE
TAXABLE YEAR IN WHICH THE EXPIRATION OCCURRED AND FOR THE NEXT SUCCEED-
ING NINE TAXABLE YEARS. IN ADDITION, THE AREAS DESIGNATED AS EMPIRE
ZONES IN WHICH THE TAXPAYER IS CERTIFIED AS A QUALIFIED INVESTMENT
PROJECT ON THE DAY IMMEDIATELY PRECEDING THE DAY THE EMPIRE ZONES
PROGRAM EXPIRED SHALL CONTINUE TO BE DEEMED EMPIRE ZONES FOR PURPOSES OF
THIS SUBDIVISION FOR THE REMAINDER OF THE TAXABLE YEAR IN WHICH THE
EXPIRATION OCCURRED AND FOR THE NEXT SUCCEEDING NINE TAXABLE YEARS.
(E) NOTWITHSTANDING THE EXPIRATION OF THE EMPIRE ZONES PROGRAM UNDER
ARTICLE EIGHTEEN-B OF THE GENERAL MUNICIPAL LAW AND EXCEPT AS PROVIDED
S. 6359 79 A. 8559
IN PARAGRAPH (D) OF THIS SUBDIVISION, A TAXPAYER THAT IS CERTIFIED AS AN
EMPIRE ZONE BUSINESS PURSUANT TO SUCH ARTICLE EIGHTEEN-B ON THE DAY
IMMEDIATELY PRECEDING THE DAY THE EMPIRE ZONES PROGRAM EXPIRED SHALL
CONTINUE TO BE DEEMED IN THE EMPIRE ZONE IN WHICH THE TAXPAYER WAS
CERTIFIED AS AN EMPIRE ZONE BUSINESS ON THE DAY IMMEDIATELY PRECEDING
THE DAY THE EMPIRE ZONES PROGRAM EXPIRED FOR EACH OF THE THREE YEARS
NEXT SUCCEEDING THE TAXABLE YEAR FOR WHICH THE CREDIT UNDER SUBDIVISION
THREE OF THIS SECTION IS ALLOWED.
5. 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 ARTI-
CLE.
(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 FIXED DOLLAR MINIMUM AMOUNT PRESCRIBED IN PARAGRAPH (D) OF
SUBDIVISION ONE OF SECTION TWO HUNDRED TEN OF THIS ARTICLE. 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.
6. 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 FIXED DOLLAR MINIMUM AMOUNT PRESCRIBED IN PARAGRAPH (D) OF
SUBDIVISION ONE OF SECTION TWO HUNDRED TEN OF THIS ARTICLE. PROVIDED,
HOWEVER, THIS PARAGRAPH SHALL NOT APPLY TO A TAXPAYER WITH A ZONE ALLO-
CATION FACTOR OF ONE HUNDRED PERCENT.
7. QUALIFIED EMERGING TECHNOLOGY COMPANY EMPLOYMENT CREDIT. (A) APPLI-
CATION OF CREDIT. A TAXPAYER SHALL BE ALLOWED A CREDIT, TO BE COMPUTED
AS HEREINAFTER PROVIDED, AGAINST THE TAX IMPOSED BY THIS ARTICLE,
PROVIDED:
(I) 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
(II) 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.
S. 6359 80 A. 8559
(B) CREDIT LIMITATION. 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) AVERAGE NUMBER OF INDIVIDUALS EMPLOYED FULL-TIME. 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 SIX OF THIS SECTION IS CLAIMED FOR
THE TAXABLE YEAR.
(D) AMOUNT OF CREDIT. 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) CARRYOVER. THE CREDIT ALLOWED UNDER THIS SUBDIVISION FOR ANY TAXA-
BLE YEAR SHALL NOT REDUCE THE TAX DUE FOR SUCH YEAR TO LESS THAN THE
FIXED DOLLAR MINIMUM AMOUNT PRESCRIBED IN PARAGRAPH (D) OF SUBDIVISION
ONE OF SECTION TWO HUNDRED TEN OF THIS ARTICLE. 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.
8. QUALIFIED EMERGING TECHNOLOGY COMPANY CAPITAL TAX CREDIT. (A)
AMOUNT OF CREDIT. 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 QUALI-
FIED 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 TECH-
NOLOGY 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 SUBPAR-
AGRAPH (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 SUBPAR-
AGRAPH (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.
(B) QUALIFIED INVESTMENT. "QUALIFIED INVESTMENT" MEANS THE CONTRIB-
UTION OF PROPERTY TO A CORPORATION IN EXCHANGE FOR ORIGINAL ISSUE CAPI-
S. 6359 81 A. 8559
TAL 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 PART-
NERSHIP 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 SUBPARA-
GRAPH ONE OF PARAGRAPH (A) OF THIS SUBDIVISION AND SHALL NOT EXCEED
THREE HUNDRED THOUSAND DOLLARS IN THE CASE OF INVESTMENTS MADE PURSUANT
TO SUBPARAGRAPH TWO OF PARAGRAPH (A) OF THIS SUBDIVISION.
(C) CARRYOVER. 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 FIXED
DOLLAR MINIMUM AMOUNT PRESCRIBED IN PARAGRAPH (D) OF SUBDIVISION ONE OF
SECTION TWO HUNDRED TEN OF THIS CHAPTER. HOWEVER, IF THE AMOUNT OF CRED-
IT 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.
(D) RECAPTURE. (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 CORPO-
RATE 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 SUBPARA-
GRAPH 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:
S. 6359 82 A. 8559
(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.
9. CREDIT FOR THE SPECIAL ADDITIONAL MORTGAGE RECORDING TAX. (A)
APPLICATION OF CREDIT. A TAXPAYER SHALL BE ALLOWED A CREDIT, TO BE CRED-
ITED 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 OR MORTGAGES RECORDED. 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 AREA. 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.
(B) CARRYOVER. IN NO EVENT SHALL THE CREDIT HEREIN PROVIDED FOR BE
ALLOWED IN AN AMOUNT WHICH WILL REDUCE THE TAX PAYABLE TO LESS THAN THE
FIXED DOLLAR MINIMUM AMOUNT PRESCRIBED IN PARAGRAPH (D) OF SUBDIVISION
ONE OF SECTION TWO HUNDRED TEN OF THIS ARTICLE. IF, HOWEVER, THE AMOUNT
OF CREDIT ALLOWABLE UNDER THIS SUBDIVISION FOR ANY TAXABLE YEAR, INCLUD-
ING ANY CREDIT CARRIED OVER FROM A PRIOR TAXABLE YEAR, REDUCES THE TAX
TO SUCH AMOUNT, ANY AMOUNT OF CREDIT NOT DEDUCTIBLE IN SUCH TAXABLE YEAR
S. 6359 83 A. 8559
MAY BE CARRIED OVER TO THE FOLLOWING YEAR OR YEARS AND MAY BE DEDUCTED
FROM THE TAXPAYER'S TAX FOR SUCH YEAR OR YEARS.
10. CREDIT FOR SERVICING CERTAIN MORTGAGES. (A) GENERAL. EVERY TAXPAY-
ER MEETING THE REQUIREMENTS OF THE STATE OF NEW YORK MORTGAGE AGENCY
APPLICABLE TO THE SERVICING OF MORTGAGES ACQUIRED BY SUCH AGENCY PURSU-
ANT TO THE STATE OF NEW YORK MORTGAGE AGENCY ACT, 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 OR AN AMOUNT EQUAL
TO TWO AND NINETY-THREE ONE HUNDREDTHS PER CENTUM OF THE TOTAL PRINCIPAL
AND INTEREST COLLECTED BY THE TAXPAYER 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 TAXPAYER 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 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 MORT-
GAGE 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. IN NO EVENT SHALL THE CREDIT ALLOWED UNDER THIS
SUBDIVISION REDUCE THE TAX TO LESS THAN THE FIXED DOLLAR MINIMUM AMOUNT
PRESCRIBED IN PARAGRAPH (D) OF SUBDIVISION ONE OF SECTION TWO HUNDRED
TEN OF THIS ARTICLE. IN COMPUTING SUCH TAX CREDIT FOR THE SERVICING OF
MORTGAGES ON ONE-FAMILY TO FOUR-FAMILY RESIDENTIAL STRUCTURES, THE
TAXPAYER SHALL NOT BE ENTITLED TO CREDIT FOR THE COLLECTION OF CURTAIL-
MENT OR PAYMENTS IN DISCHARGE OF ANY SUCH MORTGAGE. FOR THE PURPOSES OF
THIS SUBDIVISION,
(B)(I) A "CURTAILMENT" SHALL MEAN AMOUNTS PAID BY MORTGAGORS
(A) IN EXCESS OF THE MONTHLY CONSTANT DUE DURING THE MONTH OF
COLLECTION AND
(B) 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
(II) "MONTHLY CONSTANT" SHALL MEAN THE AMOUNT OF PRINCIPAL AND INTER-
EST WHICH IS DUE AND PAYABLE ACCORDING TO THE MORTGAGE DOCUMENTS ON EACH
PERIODIC PAYMENT DATE.
11. 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 FARM-
ING 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 CORPO-
RATION HAS A FEDERAL GROSS INCOME FROM FARMING FOR THE TAXABLE YEAR
WHICH IS AT LEAST TWO-THIRDS OF EXCESS FEDERAL GROSS INCOME; AND
S. 6359 84 A. 8559
PROVIDED FURTHER THAT, IN DETERMINING SUCH INCOME ELIGIBILITY, A TAXPAY-
ER 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. FOR THE PURPOSES OF THIS PARAGRAPH, PAYMENTS FROM THE STATE'S
FARMLAND PROTECTION PROGRAM, ADMINISTERED BY THE DEPARTMENT OF AGRICUL-
TURE AND MARKETS, SHALL BE INCLUDED AS FEDERAL GROSS INCOME FROM FARMING
FOR OTHERWISE ELIGIBLE FARMERS.
(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 PENAL-
TIES 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 TWENTY-EIGHT OF THIS
SECTION, MET THE REQUIREMENTS UNDER THIS PARAGRAPH.
(E) ACREAGE LIMITATION. (I) 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 SUBDIVI-
SION 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.
(II) 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 (III) OF THIS PARAGRAPH, THE BASE ACREAGE IS
THREE HUNDRED FIFTY ACRES.
THE TOTAL BASE ACREAGE MAY BE INCREASED BY ANY ACREAGE ENROLLED OR
PARTICIPATING DURING THE TAXABLE YEAR IN A FEDERAL ENVIRONMENTAL CONSER-
VATION ACREAGE RESERVE PROGRAM PURSUANT TO TITLE THREE OF THE FEDERAL
AGRICULTURE IMPROVEMENT AND REFORM ACT OF NINETEEN HUNDRED NINETY-SIX.
(III) 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 (II)
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.
(IV) RELATED PERSONS. (A) FOR PURPOSES OF SUBPARAGRAPH (III) OF THIS
PARAGRAPH, THE TERM "RELATED PERSON" MEANS:
S. 6359 85 A. 8559
(I) A CORPORATION SUBJECT TO TAX UNDER THIS ARTICLE, WHERE THE TAXPAY-
ER 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 PARTNER-
SHIP, 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 PARTNER-
SHIP, 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 PROPOR-
TIONATELY 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 APPLICA-
TION 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. (I) IN THE EVENT THAT THE MODIFIED ENTIRE NET
INCOME OF THE TAXPAYER EXCEEDS TWO HUNDRED THOUSAND DOLLARS, THE ALLOW-
ABLE SCHOOL DISTRICT PROPERTY TAXES UNDER PARAGRAPH (A) OF THIS SUBDIVI-
SION SHALL BE THE ELIGIBLE TAXES UNDER SUBPARAGRAPH (I) OF PARAGRAPH (E)
OF THIS SUBDIVISION REDUCED BY THE PRODUCT OF THE AMOUNT OF SUCH ELIGI-
BLE TAXES AND A PERCENTAGE, SUCH PERCENTAGE TO BE DETERMINED BY MULTI-
PLYING ONE HUNDRED PERCENT BY A FRACTION, THE NUMERATOR OF WHICH IS THE
LESSER OF ONE HUNDRED THOUSAND DOLLARS OR THE EXCESS OF THE TAXPAYER'S
MODIFIED ENTIRE NET INCOME OVER TWO HUNDRED THOUSAND DOLLARS AND THE
DENOMINATOR OF WHICH IS ONE HUNDRED THOUSAND DOLLARS. 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.
(II) 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) CARRYOVER. IN NO EVENT SHALL THE CREDIT PROVIDED HEREIN BE ALLOWED
IN AN AMOUNT WHICH WILL REDUCE THE TAX PAYABLE TO LESS THAN THE FIXED
DOLLAR MINIMUM AMOUNT PRESCRIBED IN PARAGRAPH (D) OF SUBDIVISION ONE OF
SECTION TWO HUNDRED TEN OF THIS ARTICLE. 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
S. 6359 86 A. 8559
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
ONE THOUSAND EIGHTY-SIX OF THIS CHAPTER EXCEPT THAT NO INTEREST SHALL BE
PAID ON SUCH OVERPAYMENT.
(H) NONQUALIFIED USE. (I) 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).
(II) 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.
(III) EXCEPTION TO RECAPTURE. SUBPARAGRAPH (II) 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.
(IV) 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, OR
FROM THE SALE OF CIDER FROM A LICENSED FARM CIDERY AS PROVIDED FOR IN
SECTION FIFTY-EIGHT-C OF THE ALCOHOLIC BEVERAGE CONTROL LAW.
(J) ELECTION TO DEEM GROSS INCOME OF NEW YORK C CORPORATION TO SHARE-
HOLDERS. 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.
12. CREDIT FOR EMPLOYMENT OF PERSONS WITH DISABILITIES. (A) ALLOWANCE
OF CREDIT. A TAXPAYER SHALL BE ALLOWED A CREDIT, TO BE COMPUTED AS HERE-
INAFTER 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
S. 6359 87 A. 8559
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 CLAIM-
ING 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 TAXA-
BLE YEAR SHALL NOT REDUCE THE TAX DUE FOR SUCH YEAR TO LESS THAN THE
FIXED DOLLAR MINIMUM AMOUNT PRESCRIBED IN PARAGRAPH (D) OF SUBDIVISION
ONE OF SECTION TWO HUNDRED TEN OF THIS CHAPTER. 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 SECTION FIFTY-ONE AND FIFTY-TWO OF THE INTERNAL REVENUE
CODE, AS SUCH SECTIONS APPLIED ON OCTOBER FIRST, NINETEEN HUNDRED NINE-
TY-SIX, THAT APPLY TO THE FEDERAL WORK OPPORTUNITY TAX CREDIT FOR VOCA-
TIONAL 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.
13. 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 FIXED DOLLAR MINIMUM
AMOUNT PRESCRIBED IN PARAGRAPH (D) OF SUBDIVISION ONE OF SECTION TWO
HUNDRED TEN OF THIS CHAPTER.
14. CREDIT FOR PURCHASE OF LONG-TERM CARE INSURANCE. (A) GENERAL. A
TAXPAYER SHALL BE ALLOWED A CREDIT AGAINST THE TAX IMPOSED BY THIS ARTI-
CLE EQUAL TO TWENTY PERCENT OF THE PREMIUM PAID DURING THE TAXABLE YEAR
S. 6359 88 A. 8559
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) CARRYOVER. THE CREDIT ALLOWED UNDER THIS SUBDIVISION FOR ANY YEAR
SHALL NOT REDUCE THE TAX DUE FOR SUCH YEAR TO LESS THAN THE FIXED DOLLAR
MINIMUM AMOUNT PRESCRIBED IN PARAGRAPH (D) OF SUBDIVISION ONE OF SECTION
TWO HUNDRED TEN OF THIS ARTICLE. 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.
15. 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 FIXED
DOLLAR MINIMUM AMOUNT PRESCRIBED IN PARAGRAPH (D) OF SUBDIVISION ONE OF
SECTION TWO HUNDRED TEN OF THIS ARTICLE. HOWEVER, IF THE AMOUNT OF CRED-
IT OR CARRYOVERS OF SUCH CREDIT, OR BOTH, ALLOWED UNDER THIS SUBDIVISION
FOR ANY TAXABLE YEAR REDUCES THE TAX TO SUCH AMOUNT, ANY AMOUNT OF CRED-
IT 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.
16. 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 FIXED DOLLAR MINIMUM
AMOUNT PRESCRIBED IN PARAGRAPH (D) OF SUBDIVISION ONE OF SECTION TWO
HUNDRED TEN OF THIS ARTICLE. HOWEVER, IF THE AMOUNT OF CREDIT OR CARRY-
OVERS 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.
17. 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 FIXED DOLLAR MINIMUM AMOUNT PRESCRIBED IN PARAGRAPH (D) OF
SUBDIVISION ONE OF SECTION TWO HUNDRED TEN OF THIS ARTICLE. 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
S. 6359 89 A. 8559
PROVISIONS OF SUBSECTION (C) OF SECTION ONE THOUSAND EIGHTY-EIGHT OF
THIS CHAPTER NOTWITHSTANDING, NO INTEREST SHALL BE PAID THEREON.
18. 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 FIXED DOLLAR MINIMUM AMOUNT PRESCRIBED IN PARAGRAPH (D) OF
SUBDIVISION ONE OF SECTION TWO HUNDRED TEN OF THIS ARTICLE. 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.
19. ENVIRONMENTAL REMEDIATION INSURANCE CREDIT. (A) ALLOWANCE OF CRED-
IT. 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 FIXED DOLLAR MINIMUM AMOUNT PRESCRIBED IN PARAGRAPH (D) OF
SUBDIVISION ONE OF SECTION TWO HUNDRED TEN OF THIS ARTICLE. 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.
20. 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 FIXED DOLLAR MINIMUM AMOUNT PRESCRIBED IN PARAGRAPH (D) OF
SUBDIVISION ONE OF SECTION TWO HUNDRED TEN OF THIS ARTICLE. PROVIDED,
HOWEVER, THAT IF THE AMOUNT OF THE CREDIT ALLOWABLE UNDER THIS SUBDIVI-
SION FOR ANY TAXABLE YEAR REDUCES THE TAX TO SUCH AMOUNT, 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.
21. SECURITY TRAINING TAX CREDIT. (A) ALLOWANCE OF CREDIT. A TAXPAYER
SHALL BE ALLOWED A CREDIT, TO BE COMPUTED AS PROVIDED IN SECTION TWEN-
TY-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
S. 6359 90 A. 8559
THAN THE FIXED DOLLAR MINIMUM AMOUNT PRESCRIBED IN PARAGRAPH (D) OF
SUBDIVISION ONE OF SECTION TWO HUNDRED TEN OF THIS CHAPTER. 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.
22. CONSERVATION EASEMENT TAX CREDIT. (A) 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, COUN-
TY 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.
(B) 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 CONSERVA-
TION 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 ENVIRON-
MENTAL CONSERVATION, AS PROVIDED FOR IN ARTICLE FORTY-NINE OF THE ENVI-
RONMENTAL 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. DEDI-
CATIONS 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.
(C) 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; EASE-
MENTS; 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.
(D) PUBLIC OR PRIVATE CONSERVATION AGENCY. FOR PURPOSES OF THIS SUBDI-
VISION, THE TERM "PUBLIC OR PRIVATE CONSERVATION AGENCY" MEANS ANY
STATE, LOCAL, OR FEDERAL GOVERNMENTAL BODY; OR ANY PRIVATE NOT-FOR-PRO-
FIT 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.
(E) 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.
(F) APPLICATION OF THE CREDIT. THE CREDIT ALLOWED UNDER THIS SUBDIVI-
SION FOR ANY TAXABLE YEAR SHALL NOT REDUCE THE TAX DUE FOR SUCH YEAR TO
LESS THAN THE FIXED DOLLAR MINIMUM AMOUNT PRESCRIBED IN PARAGRAPH (D) OF
SUBDIVISION ONE OF SECTION TWO HUNDRED TEN OF THIS ARTICLE. 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
S. 6359 91 A. 8559
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 ONE THOUSAND EIGHTY-EIGHT OF THIS CHAPTER,
EXCEPT THAT, NO INTEREST SHALL BE PAID THEREON.
23. EMPIRE STATE COMMERCIAL PRODUCTION CREDIT. (A) ALLOWANCE OF CRED-
IT. A TAXPAYER THAT IS ELIGIBLE PURSUANT TO PROVISIONS OF SECTION TWEN-
TY-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 FIXED DOLLAR MINIMUM AMOUNT PRESCRIBED IN PARAGRAPH (D) OF
SUBDIVISION ONE OF SECTION TWO HUNDRED TEN OF THIS ARTICLE. PROVIDED,
HOWEVER, THAT IF THE AMOUNT OF THE CREDIT ALLOWABLE UNDER THIS SUBDIVI-
SION 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 CRED-
IT OVER THE TAX FOR SUCH SUCCEEDING YEAR SHALL BE TREATED AS AN OVERPAY-
MENT 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.
(C) EXPIRATION OF CREDIT. THE CREDIT ALLOWED UNDER THIS SUBDIVISION
SHALL NOT BE APPLICABLE TO TAXABLE YEARS BEGINNING ON OR AFTER DECEMBER
THIRTY-FIRST, TWO THOUSAND SEVENTEEN.
24. BIOFUEL PRODUCTION CREDIT. (A) GENERAL. A TAXPAYER SHALL BE
ALLOWED A CREDIT, TO BE COMPUTED AS PROVIDED IN SECTION TWENTY-EIGHT OF
THIS CHAPTER ADDED AS PART X OF CHAPTER SIXTY-TWO OF THE LAWS OF TWO
THOUSAND SIX, 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 FIXED DOLLAR MINIMUM AMOUNT
PRESCRIBED IN PARAGRAPH (D) OF SUBDIVISION ONE OF SECTION TWO HUNDRED
TEN OF THIS ARTICLE. 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 ACCORD-
ANCE 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 TAX CREDIT ALLOWED PURSUANT TO THIS SECTION
SHALL APPLY TO TAXABLE YEARS BEGINNING BEFORE JANUARY FIRST, TWO THOU-
SAND TWENTY.
25. CLEAN HEATING FUEL CREDIT. (A) GENERAL. A TAXPAYER SHALL BE
ALLOWED A CREDIT AGAINST THE TAX IMPOSED BY THIS ARTICLE. SUCH CREDIT,
TO BE COMPUTED AS HEREINAFTER PROVIDED, SHALL BE ALLOWED FOR BIOHEAT,
USED FOR SPACE HEATING OR HOT WATER PRODUCTION FOR RESIDENTIAL PURPOSES
WITHIN THIS STATE PURCHASED BEFORE JANUARY FIRST, TWO THOUSAND SEVEN-
TEEN. SUCH CREDIT SHALL BE $0.01 PER PERCENT OF BIODIESEL PER GALLON OF
BIOHEAT, NOT TO EXCEED TWENTY CENTS PER GALLON, PURCHASED BY SUCH
TAXPAYER.
S. 6359 92 A. 8559
(B) DEFINITIONS. FOR PURPOSES OF THIS SUBDIVISION, THE FOLLOWING DEFI-
NITIONS SHALL APPLY:
(I) "BIODIESEL" SHALL MEAN A FUEL COMPRISED EXCLUSIVELY OF MONO-ALKYL
ESTERS OF LONG CHAIN FATTY ACIDS DERIVED FROM VEGETABLE OILS OR ANIMAL
FATS, DESIGNATED B100, WHICH MEETS THE SPECIFICATIONS OF AMERICAN SOCIE-
TY OF TESTING AND MATERIALS DESIGNATION D 6751.
(II) "BIOHEAT" SHALL MEAN A FUEL COMPRISED OF BIODIESEL BLENDED WITH
CONVENTIONAL HOME HEATING OIL, WHICH MEETS THE SPECIFICATIONS OF THE
AMERICAN SOCIETY OF TESTING AND MATERIALS DESIGNATION D 396 OR D 975.
(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 FIXED DOLLAR MINIMUM AMOUNT PRESCRIBED IN PARAGRAPH (D) OF
SUBDIVISION ONE OF SECTION TWO HUNDRED TEN OF THIS ARTICLE. 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.
26. CREDIT FOR REHABILITATION OF HISTORIC PROPERTIES. (A) APPLICATION
OF CREDIT. (I) FOR TAXABLE YEARS BEGINNING ON OR AFTER JANUARY FIRST,
TWO THOUSAND TEN, AND BEFORE JANUARY FIRST, TWO THOUSAND TWENTY, A
TAXPAYER SHALL BE ALLOWED A CREDIT AS HEREINAFTER PROVIDED, AGAINST THE
TAX IMPOSED BY THIS ARTICLE, IN AN AMOUNT EQUAL TO ONE HUNDRED PERCENT
OF THE AMOUNT OF CREDIT ALLOWED THE TAXPAYER FOR THE SAME TAXABLE YEAR
WITH RESPECT TO A CERTIFIED HISTORIC STRUCTURE UNDER SUBSECTION (C)(2)
OF SECTION 47 OF THE INTERNAL REVENUE CODE WITH RESPECT TO A CERTIFIED
HISTORIC STRUCTURE LOCATED WITHIN THE STATE. PROVIDED, HOWEVER, THE
CREDIT SHALL NOT EXCEED FIVE MILLION DOLLARS.
(II) FOR TAXABLE YEARS BEGINNING ON OR AFTER JANUARY FIRST, TWO THOU-
SAND TWENTY, A TAXPAYER SHALL BE ALLOWED A CREDIT AS HEREINAFTER
PROVIDED, AGAINST THE TAX IMPOSED BY THIS ARTICLE, IN AN AMOUNT EQUAL TO
THIRTY PERCENT OF THE AMOUNT OF CREDIT ALLOWED THE TAXPAYER FOR THE SAME
TAXABLE YEAR WITH RESPECT TO A CERTIFIED HISTORIC STRUCTURE UNDER
SUBSECTION (C)(3) OF SECTION 47 OF THE INTERNAL REVENUE CODE WITH
RESPECT TO A CERTIFIED HISTORIC STRUCTURE LOCATED WITHIN THE STATE.
PROVIDED, HOWEVER, THE CREDIT SHALL NOT EXCEED ONE HUNDRED THOUSAND
DOLLARS.
(B) IF THE TAXPAYER IS A PARTNER IN A PARTNERSHIP OR A SHAREHOLDER IN
A NEW YORK S CORPORATION, THEN THE CREDIT CAPS IMPOSED IN SUBPARAGRAPH
(A) OF THIS PARAGRAPH SHALL BE APPLIED AT THE ENTITY LEVEL, SO THAT THE
AGGREGATE CREDIT ALLOWED TO ALL THE PARTNERS OR SHAREHOLDERS OF EACH
SUCH ENTITY IN THE TAXABLE YEAR DOES NOT EXCEED THE CREDIT CAP THAT IS
APPLICABLE IN THAT TAXABLE YEAR.
(B) TAX CREDITS ALLOWED PURSUANT TO THIS SUBDIVISION SHALL BE ALLOWED
IN THE TAXABLE YEAR THAT THE QUALIFIED REHABILITATION IS PLACED IN
SERVICE UNDER SECTION 167 OF THE FEDERAL INTERNAL REVENUE CODE.
(C) IF THE CREDIT ALLOWED THE TAXPAYER PURSUANT TO SECTION 47 OF THE
INTERNAL REVENUE CODE WITH RESPECT TO A QUALIFIED REHABILITATION IS
RECAPTURED PURSUANT TO SUBSECTION (A) OF SECTION 50 OF THE INTERNAL
REVENUE CODE, A PORTION OF THE CREDIT ALLOWED UNDER THIS SUBSECTION MUST
BE ADDED BACK IN THE SAME TAXABLE YEAR AND IN THE SAME PROPORTION AS THE
FEDERAL CREDIT.
(D) THE CREDIT ALLOWED UNDER THIS SUBDIVISION FOR ANY TAXABLE YEAR
SHALL NOT REDUCE THE TAX DUE FOR SUCH YEAR TO LESS THAN THE AMOUNT
S. 6359 93 A. 8559
PRESCRIBED IN PARAGRAPH (D) OF SUBDIVISION ONE OF SECTION TWO HUNDRED
TEN OF THIS ARTICLE. HOWEVER, IF THE AMOUNT OF THE 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 RECREDITED OR REFUNDED IN ACCORD-
ANCE 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.
(E) TO BE ELIGIBLE FOR THE CREDIT ALLOWABLE UNDER THIS SUBDIVISION,
THE REHABILITATION PROJECT SHALL BE IN WHOLE OR IN PART LOCATED WITHIN A
CENSUS TRACT WHICH IS IDENTIFIED AS BEING AT OR BELOW ONE HUNDRED
PERCENT OF THE STATE MEDIAN FAMILY INCOME AS CALCULATED AS OF JANUARY
FIRST OF EACH YEAR USING THE MOST RECENT FIVE YEAR ESTIMATE FROM THE
AMERICAN COMMUNITY SURVEY PUBLISHED BY THE UNITED STATES CENSUS BUREAU.
27. CREDITS OF NEW YORK S CORPORATIONS. (A) GENERAL. 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. NOTWITHSTAND-
ING THE FIRST SENTENCE OF THIS SUBDIVISION, HOWEVER, THE CREDIT FOR THE
SPECIAL ADDITIONAL MORTGAGE RECORDING TAX SHALL BE ALLOWED AS PROVIDED
IN SUBDIVISION FIFTEEN OF THIS SECTION, 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.
28. NET OPERATING LOSS CONVERSION CREDIT. (A) BASE YEAR DESIGNATION.
FOR THE PURPOSES OF THIS SUBDIVISION, THE TERM "BASE YEAR" MEANS THE
LAST TAXABLE YEAR BEGINNING ON OR AFTER JANUARY FIRST, TWO THOUSAND
THIRTEEN AND BEFORE JANUARY FIRST, TWO THOUSAND FOURTEEN.
(B) ALLOWANCE OF CREDIT. A TAXPAYER WHICH HAS ANY UNABSORBED NET OPER-
ATING LOSS CARRYOVER, REFERRED TO IN THIS SUBDIVISION AS A "NOL", AFTER
CALCULATING ITS ENTIRE NET INCOME UNDER ARTICLE NINE-A OR ARTICLE THIR-
TY-TWO FOR THE BASE YEAR SHALL BE ALLOWED A CREDIT AGAINST THE TAX
IMPOSED BY THIS ARTICLE FOR TAXABLE YEARS BEGINNING ON OR AFTER JANUARY
FIRST, TWO THOUSAND FIFTEEN.
(C) CALCULATION OF CREDIT. THE TOTAL AMOUNT OF THE NOL CONVERSION
CREDIT SHALL BE THE PRODUCT OF:
(I) ANY UNABSORBED PORTION OF NET OPERATING LOSS AS CALCULATED UNDER
PARAGRAPH (F) OF SUBDIVISION NINE OF SECTION TWO HUNDRED EIGHT OF THIS
ARTICLE OR SUBSECTION (K-1) OF SECTION FOURTEEN HUNDRED FIFTY-THREE OF
ARTICLE THIRTY-TWO, AS SUCH SECTIONS WERE IN EFFECT ON DECEMBER THIRTY-
FIRST, TWO THOUSAND FOURTEEN, THAT WAS NOT DEDUCTIBLE IN PREVIOUS TAXA-
BLE YEARS AND WAS ELIGIBLE FOR CARRYOVER ON THE LAST DAY OF THE BASE
YEAR, INCLUDING ANY NET OPERATING LOSS SUSTAINED BY THE TAXPAYER DURING
THE BASE YEAR;
(II) THE TAXPAYER'S BUSINESS ALLOCATION PERCENTAGE AS CALCULATED UNDER
PARAGRAPH (A) OF SUBDIVISION THREE OF SECTION TWO HUNDRED TEN OF THIS
ARTICLE FOR THE BASE YEAR, OR THE TAXPAYER'S ALLOCATION PERCENTAGE AS
CALCULATED UNDER SECTION FOURTEEN HUNDRED FIFTY-FOUR OF ARTICLE THIRTY-
TWO FOR PURPOSES OF ALLOCATING ENTIRE NET INCOME FOR THE BASE YEAR (SUCH
ALLOCATION PERCENTAGES REFERRED TO IN THIS SUBDIVISION AS "BAP"), AS
SUCH SECTIONS WERE IN EFFECT ON DECEMBER THIRTY-FIRST, TWO THOUSAND
FOURTEEN; AND
S. 6359 94 A. 8559
(III) THE TAXPAYER'S TAX RATE FOR THE BASE YEAR AS CALCULATED UNDER
PARAGRAPH (A) OF SUBDIVISION ONE OF SECTION TWO HUNDRED TEN OF THIS
ARTICLE OR SUBSECTION (A) OF SECTION FOURTEEN HUNDRED FIFTY-FIVE OF
ARTICLE THIRTY-TWO, AS SUCH SECTIONS WERE IN EFFECT ON DECEMBER THIRTY-
FIRST, TWO THOUSAND FOURTEEN.
(D) APPLICATION OF CREDIT. A TAXPAYER, OTHER THAN A SMALL BUSINESS
CORPORATION AS DEFINED IN PARAGRAPH (E) OF THIS SUBDIVISION, IS ALLOWED
AN ANNUAL NOL CONVERSION CREDIT THAT IS EQUAL TO ONE-TENTH OF THE TOTAL
NOL CONVERSION CREDIT AS CALCULATED IN PARAGRAPH (C) OF THIS SUBDIVI-
SION. SUCH CREDIT SHALL NOT BE ALLOWED AGAINST THE TAX COMPUTED UNDER
PARAGRAPH (B) OR (D) OF SUBDIVISION ONE OF SECTION TWO HUNDRED TEN OF
THIS ARTICLE.
(E) SMALL BUSINESS PROVISIONS. (I) FOR PURPOSES OF THIS SUBDIVISION, A
SMALL BUSINESS CORPORATION IS A CORPORATION 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 BASE YEAR.
(II) APPLICATION OF CREDIT. A SMALL BUSINESS CORPORATION IS ALLOWED TO
CLAIM THE TOTAL NOL CONVERSION CREDIT AS CALCULATED IN PARAGRAPH (C) OF
THIS SUBDIVISION IN A TAXABLE YEAR. SUCH CREDIT SHALL NOT BE ALLOWED
AGAINST THE TAX COMPUTED UNDER PARAGRAPH (B) OR (D) OF SUBDIVISION ONE
OF SECTION TWO HUNDRED TEN OF THIS ARTICLE.
(F) CARRYOVER. (I) THE CREDIT ALLOWED BY THIS SUBDIVISION FOR ANY
TAXABLE YEAR MAY ONLY REDUCE THE TAX DUE FOR SUCH YEAR TO THE HIGHER OF
THE AMOUNT PRESCRIBED IN PARAGRAPH (B) OR (D) OF SUBDIVISION ONE OF
SECTION TWO HUNDRED TEN OF THIS ARTICLE.
(II) HOWEVER, IF THE AMOUNT OF CREDIT ALLOWABLE UNDER THIS SUBDIVISION
FOR ANY TAXABLE YEAR REDUCES THE TAX TO SUCH AMOUNT, OR, IF THE TAXPAYER
IS REQUIRED TO PAY A TAX UNDER PARAGRAPH (B) OF SUBDIVISION ONE OF
SECTION TWO HUNDRED TEN OF THIS ARTICLE, ANY REMAINING AMOUNT OF CREDIT
ALLOWED FOR THAT TAXABLE YEAR MAY BE CARRIED OVER TO THE NEXT TAXABLE
YEAR OR YEARS FOLLOWING SUCH TAXABLE YEAR AND MAY BE DEDUCTED FROM THE
TAXPAYER'S TAX FOR SUCH YEAR OR YEARS.
(G) COMBINED GROUPS. (I) WHERE A TAXPAYER WAS PROPERLY INCLUDED OR
REQUIRED TO BE INCLUDED IN A COMBINED REPORT FOR THE BASE YEAR PURSUANT
TO SUBDIVISION FOUR OF SECTION TWO HUNDRED ELEVEN OF THIS ARTICLE, THE
COMBINED GROUP SHALL CALCULATE ITS CREDIT USING THE COMBINED GROUP'S
TOTAL NOL, BAP, AND TAX RATE ACCORDING TO PARAGRAPH (C) OF THIS SUBDIVI-
SION.
(II) IF THE MEMBERS OF THE COMBINED GROUP IN A COMBINED REPORT FOR THE
BASE YEAR ARE THE SAME AS THE MEMBERS OF THE COMBINED GROUP IN A
COMBINED REPORT FOR THE TAXABLE YEAR IMMEDIATELY SUCCEEDING THE BASE
YEAR, THE CREDIT SHALL BE CALCULATED USING THE COMBINED GROUP'S NOL, BAP
AND APPLICABLE TAX RATE ACCORDING TO PARAGRAPH (C) OF THIS SUBDIVISION.
IF A TAXPAYER WAS PROPERLY INCLUDED IN A COMBINED REPORT FOR THE BASE
YEAR AND FILES A SEPARATE REPORT IN A SUBSEQUENT TAXABLE YEAR, THEN THE
AMOUNT OF REMAINING NOL CONVERSION CREDIT ALLOWED TO THE SEPARATE FILER
SHALL BE PROPORTIONATE TO THE AMOUNT THAT SUCH TAXPAYER CONTRIBUTED TO
THE ORIGINAL NOL CONVERSION CREDIT ON A COMBINED BASIS, AND THE REMAIN-
ING NOL CONVERSION CREDIT ALLOWED TO THE REMAINING MEMBERS OF THE
COMBINED GROUP SHALL BE REDUCED BY THE AMOUNT OF PROPORTIONATE NOL
CONVERSION CREDIT ALLOWED TO THE TAXPAYER OR TAXPAYERS FILING SEPARATE-
LY. IF A COMBINED GROUP INCLUDES ADDITIONAL MEMBERS IN THE TAXABLE YEAR
IMMEDIATELY SUCCEEDING THE BASE YEAR WHO WERE NOT INCLUDED IN THE
COMBINED GROUP DURING THE BASE YEAR, EACH INDIVIDUAL COMBINED GROUP AND
SEPARATELY FILING TAXPAYER SHALL CALCULATE ITS CREDIT FOR THE BASE YEAR
S. 6359 95 A. 8559
AND THE SUM OF THE CREDITS SHALL BE THE COMBINED NOL CONVERSION CREDIT
OF THE COMBINED GROUP.
(H) EXPIRATION OF CREDIT. THE CREDIT ALLOWED UNDER THIS SUBDIVISION
SHALL NOT BE APPLICABLE TO TAXABLE YEARS BEGINNING ON OR AFTER JANUARY
FIRST, TWO THOUSAND THIRTY-FIVE.
29. HIRE A VET CREDIT. (A) ALLOWANCE OF CREDIT. FOR TAXABLE YEARS
BEGINNING ON OR AFTER JANUARY FIRST, TWO THOUSAND FIFTEEN AND BEFORE
JANUARY FIRST, TWO THOUSAND SEVENTEEN, A TAXPAYER SHALL BE ALLOWED A
CREDIT, TO BE COMPUTED AS PROVIDED IN THIS SUBDIVISION, AGAINST THE TAX
IMPOSED BY THIS ARTICLE, FOR HIRING AND EMPLOYING, FOR NOT LESS THAN ONE
YEAR AND FOR NOT LESS THAN THIRTY-FIVE HOURS EACH WEEK, A QUALIFIED
VETERAN WITHIN THE STATE. THE TAXPAYER MAY CLAIM THE CREDIT IN THE YEAR
IN WHICH THE QUALIFIED VETERAN COMPLETES ONE YEAR OF EMPLOYMENT BY THE
TAXPAYER. IF THE TAXPAYER CLAIMS THE CREDIT ALLOWED UNDER THIS SUBDIVI-
SION, THE TAXPAYER MAY NOT USE THE HIRING OF A QUALIFIED VETERAN THAT IS
THE BASIS FOR THIS CREDIT IN THE BASIS OF ANY OTHER CREDIT ALLOWED UNDER
THIS ARTICLE.
(B) QUALIFIED VETERAN. A QUALIFIED VETERAN IS AN INDIVIDUAL:
(1) WHO SERVED ON ACTIVE DUTY IN THE UNITED STATES ARMY, NAVY, AIR
FORCE, MARINE CORPS, COAST GUARD OR THE RESERVES THEREOF, OR WHO SERVED
IN ACTIVE MILITARY SERVICE OF THE UNITED STATES AS A MEMBER OF THE ARMY
NATIONAL GUARD, AIR NATIONAL GUARD, NEW YORK GUARD OR NEW YORK NAVAL
MILITIA; WHO WAS RELEASED FROM ACTIVE DUTY BY GENERAL OR HONORABLE
DISCHARGE AFTER SEPTEMBER ELEVENTH, TWO THOUSAND ONE;
(2) WHO COMMENCES EMPLOYMENT BY THE QUALIFIED TAXPAYER ON OR AFTER
JANUARY FIRST, TWO THOUSAND FOURTEEN, AND BEFORE JANUARY FIRST, TWO
THOUSAND SIXTEEN; AND
(3) WHO CERTIFIES BY SIGNED AFFIDAVIT, UNDER PENALTY OF PERJURY, THAT
HE OR SHE HAS NOT BEEN EMPLOYED FOR THIRTY-FIVE OR MORE HOURS DURING ANY
WEEK IN THE ONE HUNDRED EIGHTY DAY PERIOD IMMEDIATELY PRIOR TO HIS OR
HER EMPLOYMENT BY THE TAXPAYER.
(C) EMPLOYER PROHIBITION. AN EMPLOYER SHALL NOT DISCHARGE AN EMPLOYEE
AND HIRE A QUALIFYING VETERAN SOLELY FOR THE PURPOSE OF QUALIFYING FOR
THIS CREDIT.
(D) AMOUNT OF CREDIT. THE AMOUNT OF THE CREDIT SHALL BE TEN PERCENT OF
THE TOTAL AMOUNT OF WAGES PAID TO THE QUALIFIED VETERAN DURING THE
VETERAN'S FIRST FULL YEAR OF EMPLOYMENT. PROVIDED, HOWEVER, THAT, IF THE
QUALIFIED VETERAN IS A DISABLED VETERAN, AS DEFINED IN PARAGRAPH (B) OF
SUBDIVISION ONE OF SECTION EIGHTY-FIVE OF THE CIVIL SERVICE LAW, THE
AMOUNT OF THE CREDIT SHALL BE FIFTEEN PERCENT OF THE TOTAL AMOUNT OF
WAGES PAID TO THE QUALIFIED VETERAN DURING THE VETERAN'S FIRST FULL YEAR
OF EMPLOYMENT. THE CREDIT ALLOWED PURSUANT TO THIS SUBDIVISION SHALL NOT
EXCEED IN ANY TAXABLE YEAR, FIVE THOUSAND DOLLARS FOR ANY QUALIFIED
VETERAN AND FIFTEEN THOUSAND DOLLARS FOR ANY QUALIFIED VETERAN WHO IS A
DISABLED VETERAN.
(E) CARRYOVER. THE CREDIT ALLOWED UNDER THIS SUBDIVISION FOR ANY TAXA-
BLE YEAR SHALL NOT REDUCE THE TAX DUE FOR SUCH YEAR TO LESS THAN THE
AMOUNT PRESCRIBED IN PARAGRAPH (D) OF SUBDIVISION ONE OF SECTION TWO
HUNDRED TEN OF THIS ARTICLE. 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 THREE YEARS AND MAY BE DEDUCTED FROM THE
TAXPAYER'S TAX FOR SUCH YEAR OR YEARS.
30. ALTERNATIVE FUELS AND ELECTRIC VEHICLE RECHARGING PROPERTY CREDIT.
(A) GENERAL. A TAXPAYER SHALL BE ALLOWED A CREDIT, TO BE COMPUTED AS
HEREINAFTER PROVIDED, AGAINST THE TAX IMPOSED BY THIS ARTICLE FOR ALTER-
S. 6359 96 A. 8559
NATIVE FUEL VEHICLE REFUELING AND ELECTRIC VEHICLE RECHARGING PROPERTY
PLACED IN SERVICE DURING THE TAXABLE YEAR.
(B) ALTERNATIVE FUEL VEHICLE REFUELING PROPERTY AND ELECTRIC VEHICLE
RECHARGING PROPERTY. THE CREDIT UNDER THIS SUBDIVISION FOR ALTERNATIVE
FUEL VEHICLE REFUELING PROPERTY AND ELECTRIC VEHICLE RECHARGING PROPERTY
SHALL EQUAL FOR EACH INSTALLATION OF PROPERTY THE LESSER OF FIVE THOU-
SAND DOLLARS OR FIFTY PERCENT OF THE COST OF ANY SUCH PROPERTY:
(I) WHICH IS LOCATED IN THIS STATE;
(II) WHICH CONSTITUTES ALTERNATIVE FUEL VEHICLE REFUELING PROPERTY OR
ELECTRIC VEHICLE RECHARGING PROPERTY; AND
(III) FOR WHICH NONE OF THE COST HAS BEEN PAID FOR FROM THE PROCEEDS
OF GRANTS, INCLUDING GRANTS FROM THE NEW YORK STATE ENERGY RESEARCH AND
DEVELOPMENT AUTHORITY OR THE NEW YORK POWER AUTHORITY.
(C) DEFINITIONS. (I) THE TERM "ALTERNATIVE FUEL VEHICLE REFUELING
PROPERTY" MEANS ALL OF THE EQUIPMENT NEEDED TO DISPENSE ANY FUEL AT
LEAST EIGHTY-FIVE PERCENT OF THE VOLUME OF WHICH CONSISTS OF ONE OR MORE
OF THE FOLLOWING: NATURAL GAS, LIQUIFIED NATURAL GAS, LIQUIFIED PETROLE-
UM, OR HYDROGEN.
(II) THE TERM "ELECTRIC VEHICLE RECHARGING PROPERTY" MEANS ALL OF THE
EQUIPMENT NEEDED TO CONVEY ELECTRIC POWER FROM THE ELECTRIC GRID OR
ANOTHER POWER SOURCE TO AN ONBOARD VEHICLE ENERGY STORAGE SYSTEM.
(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
AMOUNT PRESCRIBED IN PARAGRAPH (D) OF SUBDIVISION ONE OF SECTION TWO
HUNDRED TEN OF THIS ARTICLE. 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. IF, AT ANY TIME BEFORE THE END OF ITS RECOVERY
PERIOD, ALTERNATIVE FUEL VEHICLE REFUELING OR ELECTRIC VEHICLE RECHARG-
ING PROPERTY CEASES TO BE QUALIFIED, A RECAPTURE AMOUNT MUST BE ADDED
BACK IN THE YEAR IN WHICH SUCH CESSATION OCCURS.
(I) ALTERNATIVE FUEL VEHICLE REFUELING PROPERTY OR ELECTRIC VEHICLE
RECHARGING PROPERTY CEASES TO BE QUALIFIED IF:
(I) THE PROPERTY NO LONGER QUALIFIES AS ALTERNATIVE FUEL VEHICLE REFU-
ELING PROPERTY OR ELECTRIC VEHICLE RECHARGING PROPERTY; OR
(II) 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
(III) 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 (I) AND (II) OF
THIS SUBPARAGRAPH.
(II) 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) TERMINATION. THE CREDIT ALLOWED BY PARAGRAPH (B) OF THIS SUBDIVI-
SION SHALL NOT APPLY IN TAXABLE YEARS BEGINNING AFTER DECEMBER
THIRTY-FIRST, TWO THOUSAND SEVENTEEN.
31. EXCELSIOR JOBS PROGRAM CREDIT. (A) ALLOWANCE OF CREDIT. A TAXPAYER
WILL BE ALLOWED A CREDIT, TO BE COMPUTED AS PROVIDED IN SECTION THIRTY-
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 MAY NOT REDUCE THE TAX DUE FOR SUCH YEAR TO LESS
S. 6359 97 A. 8559
THAN THE AMOUNT PRESCRIBED IN PARAGRAPH (D) OF SUBDIVISION ONE OF
SECTION TWO HUNDRED TEN OF THIS ARTICLE. HOWEVER, IF THE AMOUNT OF CRED-
IT 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 WILL 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 WILL BE PAID THEREON.
32. EMPIRE STATE FILM POST PRODUCTION CREDIT. (A) ALLOWANCE OF CREDIT.
A TAXPAYER WHO IS ELIGIBLE PURSUANT TO SECTION THIRTY-ONE OF THIS CHAP-
TER SHALL BE ALLOWED A CREDIT TO BE COMPUTED AS PROVIDED IN SUCH SECTION
THIRTY-ONE 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
SECTION TWO HUNDRED TEN OF THIS ARTICLE. 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 A CARRYOVER 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 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.
33. TEMPORARY DEFERRAL NONREFUNDABLE PAYOUT CREDIT. (A) ALLOWANCE OF
CREDIT. A TAXPAYER SHALL BE ALLOWED A CREDIT, TO BE COMPUTED AS PROVIDED
IN SUBDIVISION ONE OF SECTION THIRTY-FOUR 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 THAT YEAR TO LESS
THAN THE AMOUNT PRESCRIBED IN PARAGRAPH (D) OF SUBDIVISION ONE OF
SECTION TWO HUNDRED TEN OF THIS ARTICLE. HOWEVER, IF THE AMOUNT OF CRED-
IT 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.
34. TEMPORARY DEFERRAL REFUNDABLE PAYOUT CREDIT. (A) ALLOWANCE OF
CREDIT. A TAXPAYER SHALL BE ALLOWED A CREDIT, TO BE COMPUTED AS PROVIDED
IN SUBDIVISION TWO OF SECTION THIRTY-FOUR OF THIS CHAPTER, AGAINST THE
TAX IMPOSED BY THIS ARTICLE.
(B) APPLICATION OF CREDIT. IN NO EVENT SHALL THE CREDIT UNDER THIS
SUBDIVISION BE ALLOWED IN AN AMOUNT WHICH WILL REDUCE THE TAX TO LESS
THAN THE AMOUNT PRESCRIBED IN PARAGRAPH (D) OF SUBDIVISION ONE OF
SECTION TWO HUNDRED TEN OF THIS ARTICLE. IF, HOWEVER, 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 REFUNDED IN ACCORD-
S. 6359 98 A. 8559
ANCE WITH THE PROVISIONS OF SECTION ONE THOUSAND EIGHTY-SIX OF THIS
CHAPTER, PROVIDED HOWEVER, THAT NO INTEREST SHALL BE PAID THEREON.
35. ECONOMIC TRANSFORMATION AND FACILITY REDEVELOPMENT PROGRAM TAX
CREDIT. (A) ALLOWANCE OF CREDIT. A TAXPAYER SHALL BE ALLOWED A CREDIT,
TO BE COMPUTED AS PROVIDED IN SECTION THIRTY-FIVE OF THIS CHAPTER,
AGAINST THE TAX IMPOSED BY THIS ARTICLE.
(B) APPLICATION OF CREDIT. THE CREDIT ALLOWED UNDER THIS SUBDIVISION
FOR ANY TAXABLE YEAR MAY NOT REDUCE THE TAX DUE FOR SUCH YEAR TO LESS
THAN THE AMOUNT PRESCRIBED IN PARAGRAPH (D) OF SUBDIVISION ONE OF
SECTION TWO HUNDRED TEN OF THIS ARTICLE. HOWEVER, IF THE AMOUNT OF CRED-
IT 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 WILL 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 WILL BE PAID THEREON.
36. NEW YORK YOUTH WORKS TAX CREDIT. (A) A TAXPAYER THAT HAS BEEN
CERTIFIED BY THE COMMISSIONER OF LABOR AS A QUALIFIED EMPLOYER PURSUANT
TO SECTION TWENTY-FIVE-A OF THE LABOR LAW SHALL BE ALLOWED A CREDIT
AGAINST THE TAX IMPOSED BY THIS ARTICLE EQUAL TO (I) FIVE HUNDRED
DOLLARS PER MONTH FOR UP TO SIX MONTHS FOR EACH QUALIFIED EMPLOYEE THE
EMPLOYER EMPLOYS IN A FULL-TIME JOB OR TWO HUNDRED FIFTY DOLLARS PER
MONTH FOR UP TO SIX MONTHS FOR EACH QUALIFIED EMPLOYEE THE EMPLOYER
EMPLOYS IN A PART-TIME JOB OF AT LEAST TWENTY HOURS PER WEEK OR TEN
HOURS PER WEEK WHEN THE QUALIFIED EMPLOYEE IS ENROLLED IN HIGH SCHOOL
FULL-TIME, (II) ONE THOUSAND DOLLARS FOR EACH QUALIFIED EMPLOYEE WHO IS
EMPLOYED FOR AT LEAST AN ADDITIONAL SIX MONTHS BY THE QUALIFIED EMPLOYER
IN A FULL-TIME JOB OR FIVE HUNDRED DOLLARS FOR EACH QUALIFIED EMPLOYEE
WHO IS EMPLOYED FOR AT LEAST AN ADDITIONAL SIX MONTHS BY THE QUALIFIED
EMPLOYER IN A PART-TIME JOB OF AT LEAST TWENTY HOURS PER WEEK OR TEN
HOURS PER WEEK WHEN THE QUALIFIED EMPLOYEE IS ENROLLED IN HIGH SCHOOL
FULL-TIME, AND (III) AN ADDITIONAL ONE THOUSAND DOLLARS FOR EACH QUALI-
FIED EMPLOYEE WHO IS EMPLOYED FOR AT LEAST AN ADDITIONAL YEAR AFTER THE
FIRST YEAR OF THE EMPLOYEE'S EMPLOYMENT BY THE QUALIFIED EMPLOYER IN A
FULL-TIME JOB OR FIVE HUNDRED DOLLARS FOR EACH QUALIFIED EMPLOYEE WHO IS
EMPLOYED FOR AT LEAST AN ADDITIONAL YEAR AFTER THE FIRST YEAR OF THE
EMPLOYEE'S EMPLOYMENT BY THE QUALIFIED EMPLOYER IN A PART-TIME JOB OF AT
LEAST TWENTY HOURS PER WEEK OR TEN HOURS PER WEEK WHEN THE QUALIFIED
EMPLOYEE IS ENROLLED IN HIGH SCHOOL FULL-TIME. FOR PURPOSES OF THIS
SUBDIVISION, THE TERM "QUALIFIED EMPLOYEE" SHALL HAVE THE SAME MEANING
AS SET FORTH IN SUBDIVISION (B) OF SECTION TWENTY-FIVE-A OF THE LABOR
LAW. THE PORTION OF THE CREDIT DESCRIBED IN SUBPARAGRAPH (I) OF THIS
PARAGRAPH SHALL BE ALLOWED FOR THE TAXABLE YEAR IN WHICH THE WAGES ARE
PAID TO THE QUALIFIED EMPLOYEE, AND THE PORTION OF THE CREDIT DESCRIBED
IN SUBPARAGRAPH (II) OF THIS PARAGRAPH SHALL BE ALLOWED IN THE TAXABLE
YEAR IN WHICH THE ADDITIONAL SIX MONTH PERIOD ENDS.
(B) THE CREDIT ALLOWED UNDER THIS SUBDIVISION FOR ANY TAXABLE YEAR MAY
NOT REDUCE THE TAX DUE FOR THAT YEAR TO LESS THAN THE AMOUNT PRESCRIBED
IN PARAGRAPH (D) OF SUBDIVISION ONE OF SECTION TWO HUNDRED TEN OF THIS
ARTICLE. HOWEVER, IF THE AMOUNT OF THE CREDIT ALLOWED UNDER THIS SUBDI-
VISION FOR ANY TAXABLE YEAR REDUCES THE TAX TO THAT AMOUNT, ANY AMOUNT
OF CREDIT NOT DEDUCTIBLE IN THAT TAXABLE YEAR WILL 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, NO INTEREST WILL BE PAID THEREON.
S. 6359 99 A. 8559
(C) THE TAXPAYER MAY BE REQUIRED TO ATTACH TO ITS TAX RETURN ITS
CERTIFICATE OF ELIGIBILITY ISSUED BY THE COMMISSIONER OF LABOR PURSUANT
TO SECTION TWENTY-FIVE-A OF THE LABOR LAW. IN NO EVENT SHALL THE TAXPAY-
ER BE ALLOWED A CREDIT GREATER THAN THE AMOUNT OF THE CREDIT LISTED ON
THE CERTIFICATE OF ELIGIBILITY. NOTWITHSTANDING ANY PROVISION OF THIS
CHAPTER TO THE CONTRARY, THE COMMISSIONER AND THE COMMISSIONER'S DESIG-
NEES MAY RELEASE THE NAMES AND ADDRESSES OF ANY TAXPAYER CLAIMING THIS
CREDIT AND THE AMOUNT OF THE CREDIT EARNED BY THE TAXPAYER. PROVIDED,
HOWEVER, IF A TAXPAYER CLAIMS THIS CREDIT BECAUSE IT IS A MEMBER OF A
LIMITED LIABILITY COMPANY OR A PARTNER IN A PARTNERSHIP, ONLY THE AMOUNT
OF CREDIT EARNED BY THE ENTITY AND NOT THE AMOUNT OF CREDIT CLAIMED BY
THE TAXPAYER MAY BE RELEASED.
37. EMPIRE STATE JOBS RETENTION PROGRAM CREDIT. (A) ALLOWANCE OF CRED-
IT. A TAXPAYER WILL BE ALLOWED A CREDIT, TO BE COMPUTED AS PROVIDED IN
SECTION THIRTY-SIX OF THIS CHAPTER, AGAINST THE TAXES IMPOSED BY THIS
ARTICLE.
(B) APPLICATION OF CREDIT. THE CREDIT ALLOWED UNDER THIS SUBDIVISION
FOR ANY TAXABLE YEAR WILL NOT REDUCE THE TAX DUE FOR SUCH YEAR TO LESS
THAN THE AMOUNT PRESCRIBED IN PARAGRAPH (D) OF SUBDIVISION ONE OF
SECTION TWO HUNDRED TEN OF THIS ARTICLE. HOWEVER, IF THE AMOUNT OF CRED-
IT 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 WILL 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 WILL BE PAID THEREON.
38. CREDIT FOR COMPANIES WHO PROVIDE TRANSPORTATION TO INDIVIDUALS
WITH DISABILITIES. (A) ALLOWANCE AND AMOUNT OF CREDIT. A TAXPAYER, WHO
PROVIDES A TAXICAB SERVICE AS DEFINED IN SECTION ONE HUNDRED
FORTY-EIGHT-A OF THE VEHICLE AND TRAFFIC LAW, OR A LIVERY SERVICE AS
DEFINED IN SECTION ONE HUNDRED TWENTY-ONE-E OF THE VEHICLE AND TRAFFIC
LAW, SHALL BE ALLOWED A CREDIT, TO BE COMPUTED AS PROVIDED IN THIS
SUBDIVISION, AGAINST THE TAX IMPOSED BY THIS ARTICLE. THE AMOUNT OF THE
CREDIT SHALL BE EQUAL TO THE INCREMENTAL COST ASSOCIATED WITH UPGRADING
A VEHICLE SO THAT IT IS ACCESSIBLE BY INDIVIDUALS WITH DISABILITIES AS
DEFINED IN PARAGRAPH (B) OF THIS SUBDIVISION. PROVIDED, HOWEVER, THAT
SUCH CREDIT SHALL NOT EXCEED TEN THOUSAND DOLLARS PER VEHICLE. FOR
PURPOSES OF THIS SUBDIVISION, PURCHASES OF NEW VEHICLES THAT ARE
INITIALLY MANUFACTURED TO BE ACCESSIBLE FOR INDIVIDUALS WITH DISABILI-
TIES AND FOR WHICH THERE IS NO COMPARABLE MAKE AND MODEL THAT DOES NOT
INCLUDE THE EQUIPMENT NECESSARY TO PROVIDE ACCESSIBILITY TO INDIVIDUALS
WITH DISABILITIES, THE CREDIT SHALL BE TEN THOUSAND DOLLARS PER VEHICLE.
(B) DEFINITION. THE TERM "ACCESSIBLE BY INDIVIDUALS WITH DISABILITIES"
SHALL, FOR THE PURPOSES OF THIS SUBDIVISION, REFER TO A VEHICLE THAT
COMPLIES WITH FEDERAL REGULATIONS PROMULGATED PURSUANT TO THE AMERICANS
WITH DISABILITIES ACT APPLICABLE TO VANS UNDER TWENTY-TWO FEET IN
LENGTH, BY THE FEDERAL DEPARTMENT OF TRANSPORTATION, IN CODE OF FEDERAL
REGULATIONS, TITLE 49, PARTS 37 AND 38, AND BY THE FEDERAL ARCHITECTURE
AND TRANSPORTATION BARRIERS COMPLIANCE BOARD, IN CODE OF FEDERAL REGU-
LATIONS, TITLE 36, SECTION 1192.23, AND THE FEDERAL MOTOR VEHICLE SAFETY
STANDARDS, CODE OF FEDERAL REGULATIONS, TITLE 49, PART 57.
(C) APPLICATION OF CREDIT. 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 AMOUNT PRESCRIBED IN PARAGRAPH (D) OF SUBDIVISION ONE
OF SECTION TWO HUNDRED TEN OF THIS ARTICLE. HOWEVER, IF THE AMOUNT OF
S. 6359 100 A. 8559
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 CARRIED OVER TO THE FOLLOWING YEAR OR YEARS, AND
MAY BE DEDUCTED FROM THE TAXPAYER'S TAX FOR SUCH YEAR OR YEARS.
39. BEER PRODUCTION CREDIT. A TAXPAYER SHALL BE ALLOWED A CREDIT, TO
BE COMPUTED AS PROVIDED IN SECTION THIRTY-SEVEN OF THIS CHAPTER, AGAINST
THE TAX IMPOSED BY THIS ARTICLE. 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 AMOUNT PRESCRIBED IN PARAGRAPH (D) OF SUBDIVISION
ONE OF SECTION TWO HUNDRED TEN OF THIS ARTICLE. 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.
40. MINIMUM WAGE REIMBURSEMENT CREDIT. (A) ALLOWANCE OF CREDIT. A
TAXPAYER SHALL BE ALLOWED A CREDIT, TO BE COMPUTED AS PROVIDED IN
SECTION THIRTY-EIGHT OF THIS CHAPTER, AGAINST THE TAX IMPOSED BY THIS
ARTICLE.
(B) APPLICATION OF CREDIT. THE CREDIT ALLOWED UNDER THIS SUBDIVISION
FOR ANY TAXABLE YEAR MAY NOT REDUCE THE TAX DUE FOR SUCH YEAR TO LESS
THAN THE AMOUNT PRESCRIBED IN PARAGRAPH (D) OF SUBDIVISION ONE OF
SECTION TWO HUNDRED TEN OF THIS ARTICLE. HOWEVER, IF THE AMOUNT OF CRED-
IT 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 WILL 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 WILL BE PAID THEREON.
41. THE TAX-FREE NY AREA TAX ELIMINATION CREDIT. A TAXPAYER SHALL BE
ALLOWED A CREDIT TO BE COMPUTED AS PROVIDED IN SECTION FORTY OF THIS
CHAPTER, AGAINST THE TAX IMPOSED BY THIS ARTICLE. UNLESS THE TAXPAYER
HAS A TAX-FREE NY AREA ALLOCATION FACTOR OF ONE HUNDRED PERCENT, 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 SECTION TWO HUNDRED TEN OF THIS
ARTICLE. HOWEVER, 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 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.
42. ALTERNATIVE BASE CREDIT. (A) IF THE TAX IMPOSED ON A TAXPAYER BY
SUBDIVISION ONE OF SECTION TWO HUNDRED NINE OF THIS ARTICLE IS THE
AMOUNT PRESCRIBED IN PARAGRAPH (B) OF SUBDIVISION ONE OF SECTION TWO
HUNDRED TEN OF THIS ARTICLE, THE TAXPAYER SHALL BE ALLOWED A CREDIT
AGAINST THE TAX IMPOSED UNDER THIS ARTICLE EQUAL TO THE AMOUNT OF TAX
PAID TO ANOTHER STATE COMPUTED ON A TAX BASE IDENTICAL TO THE TAX BASE
PRESCRIBED IN SUCH PARAGRAPH (B). IF THE TAX IMPOSED ON A TAXPAYER BY
SUBDIVISION ONE OF SECTION TWO HUNDRED NINE OF THIS ARTICLE IS THE
AMOUNT PRESCRIBED IN PARAGRAPH (D) OF SUBDIVISION ONE OF SECTION TWO
HUNDRED TEN OF THIS ARTICLE, THE TAXPAYER SHALL BE ALLOWED A CREDIT
AGAINST THE TAX IMPOSED UNDER THIS ARTICLE EQUAL TO THE AMOUNT OF TAX
S. 6359 101 A. 8559
PAID TO ANOTHER STATE COMPUTED ON A TAX BASE IDENTICAL TO THE TAX BASE
PRESCRIBED IN SUCH PARAGRAPH (D).
(B) 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
AMOUNT PRESCRIBED IN PARAGRAPH (D) OF SUBDIVISION ONE OF SECTION TWO
HUNDRED TEN OF THIS ARTICLE. 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 CARRIED OVER TO THE FOLLOWING YEAR OR YEARS, AND MAY BE
DEDUCTED FROM THE TAXPAYER'S TAX FOR SUCH YEAR OR YEARS.
43. REAL PROPERTY TAX CREDIT FOR MANUFACTURERS. (A) A QUALIFIED NEW
YORK MANUFACTURER, AS DEFINED IN SUBDIVISION FIFTEEN OF SECTION TWO
HUNDRED EIGHT OF THIS ARTICLE, WILL BE ALLOWED A CREDIT EQUAL TO TWENTY
PERCENT OF THE REAL PROPERTY TAX IT PAID DURING THE TAXABLE YEAR FOR
REAL PROPERTY OWNED BY SUCH MANUFACTURER IN NEW YORK WHICH WAS PRINCI-
PALLY USED DURING THE TAXABLE YEAR FOR MANUFACTURING TO THE EXTENT NOT
DEDUCTED IN DETERMINING ENTIRE NET INCOME. THIS CREDIT WILL NOT BE
ALLOWED IF THE REAL PROPERTY TAXES THAT ARE THE BASIS FOR THIS CREDIT
ARE INCLUDED IN THE CALCULATION OF ANOTHER CREDIT CLAIMED BY THE TAXPAY-
ER.
(B) FOR PURPOSES OF THIS SUBDIVISION, THE TERM REAL PROPERTY TAX MEANS
A CHARGE IMPOSED UPON REAL PROPERTY BY OR ON BEHALF OF A COUNTY, CITY,
TOWN, VILLAGE OR SCHOOL DISTRICT FOR MUNICIPAL OR SCHOOL DISTRICT
PURPOSES, PROVIDED THAT THE CHARGE IS LEVIED FOR THE GENERAL PUBLIC
WELFARE BY THE PROPER TAXING AUTHORITIES AT A LIKE RATE AGAINST ALL
PROPERTY OVER WHICH SUCH AUTHORITIES HAVE JURISDICTION, AND PROVIDED
THAT WHERE TAXES ARE LEVIED PURSUANT TO ARTICLE EIGHTEEN OR NINETEEN OF
THE REAL PROPERTY TAX LAW, THE PROPERTY MUST HAVE BEEN TAXED AT THE RATE
DETERMINED FOR THE CLASS IN WHICH IT IS CONTAINED, AS PROVIDED BY SUCH
ARTICLE EIGHTEEN OR NINETEEN, WHICHEVER IS APPLICABLE. THE TERM REAL
PROPERTY TAX DOES NOT INCLUDE A CHARGE FOR LOCAL BENEFITS, INCLUDING ANY
PORTION OF THAT CHARGE THAT IS PROPERLY ALLOCATED TO THE COSTS ATTRIBUT-
ABLE TO MAINTENANCE OR INTEREST, WHEN (1) THE PROPERTY SUBJECT TO THE
CHARGE IS LIMITED TO THE PROPERTY THAT BENEFITS FROM THE CHARGE, OR (2)
THE AMOUNT OF THE CHARGE IS DETERMINED BY THE BENEFIT TO THE PROPERTY
ASSESSED, OR (3) THE IMPROVEMENT FOR WHICH THE CHARGE IS ASSESSED TENDS
TO INCREASE THE PROPERTY VALUE. THE TERM REAL PROPERTY TAX DOES NOT
INCLUDE A PAYMENT IN LIEU OF TAXES MADE BY THE QUALIFIED NEW YORK
MANUFACTURER.
(C) CREDIT RECAPTURE. WHERE A QUALIFIED NEW YORK MANUFACTURER'S REAL
PROPERTY TAXES WHICH WERE THE BASIS FOR THE ALLOWANCE OF THE CREDIT
PROVIDED FOR UNDER THIS SUBDIVISION ARE SUBSEQUENTLY REDUCED AS A RESULT
OF A FINAL ORDER IN ANY PROCEEDING UNDER ARTICLE SEVEN OF THE REAL PROP-
ERTY TAX LAW OR OTHER PROVISION OF LAW, THE TAXPAYER SHALL ADD BACK, IN
THE TAXABLE YEAR IN WHICH SUCH FINAL ORDER IS ISSUED, THE EXCESS OF (1)
THE AMOUNT OF CREDIT ORIGINALLY ALLOWED FOR A TAXABLE YEAR OVER (2) THE
AMOUNT OF CREDIT DETERMINED BASED UPON THE REDUCED REAL PROPERTY TAXES.
IF SUCH FINAL ORDER REDUCES REAL PROPERTY TAXES FOR MORE THAN ONE YEAR,
THE TAXPAYER MUST DETERMINE HOW MUCH OF SUCH REDUCTION IS ATTRIBUTABLE
TO EACH YEAR COVERED BY SUCH FINAL ORDER AND CALCULATE THE AMOUNT OF
CREDIT WHICH IS REQUIRED BY THIS SUBDIVISION TO BE RECAPTURED FOR EACH
YEAR BASED ON SUCH REDUCTION.
(D) 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 SECTION TWO HUNDRED
TEN OF THIS CHAPTER. HOWEVER, ANY AMOUNT OF CREDIT NOT DEDUCTIBLE IN
S. 6359 102 A. 8559
SUCH TAXABLE YEAR SHALL BE TREATED AS AN OVERPAYMENT OF TAX TO BE CRED-
ITED OR REFUNDED IN ACCORDANCE WITH THE PROVISIONS OF SECTION ONE THOU-
SAND 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.
44. THE TAX-FREE NY AREA EXCISE TAX ON TELECOMMUNICATION SERVICES
CREDIT. A TAXPAYER THAT IS A BUSINESS OR OWNER OF A BUSINESS THAT IS
LOCATED IN A TAX-FREE NY AREA APPROVED PURSUANT TO ARTICLE TWENTY-ONE OF
THE ECONOMIC DEVELOPMENT LAW SHALL BE ALLOWED A CREDIT EQUAL TO THE
EXCISE TAX ON TELECOMMUNICATION SERVICES IMPOSED BY SECTION ONE HUNDRED
EIGHTY-SIX-E OF THIS CHAPTER AND PASSED THROUGH TO SUCH BUSINESS DURING
THE TAXABLE YEAR TO THE EXTENT NOT OTHERWISE DEDUCTED IN COMPUTING TAX
UNDER THIS ARTICLE. HOWEVER, 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 ONE THOUSAND
EIGHTY-SIX OF THIS CHAPTER. THIS CREDIT MAY BE CLAIMED ONLY WHERE ANY
TAX IMPOSED BY SUCH SECTION ONE HUNDRED EIGHTY-SIX-E HAS BEEN SEPARATELY
STATED ON A BILL FROM THE PROVIDER OF TELECOMMUNICATION SERVICES AND
PAID BY SUCH BUSINESS DURING THE TAXABLE YEAR. UNLESS THE TAXPAYER HAS A
TAX-FREE NY AREA ALLOCATION FACTOR OF ONE HUNDRED PERCENT, 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 SECTION TWO HUNDRED TEN OF THIS CHAPTER.
PROVIDED, HOWEVER, THE PROVISIONS OF SUBSECTION (C) OF SECTION ONE THOU-
SAND EIGHTY-EIGHT OF THIS CHAPTER NOTWITHSTANDING, NO INTEREST SHALL BE
PAID THEREON.
45. ORDER OF CREDITS. (A) CREDITS ALLOWABLE UNDER THIS ARTICLE WHICH
CANNOT BE CARRIED OVER AND WHICH ARE NOT REFUNDABLE SHALL BE DEDUCTED
FIRST. THE CREDIT ALLOWABLE UNDER SUBDIVISION SIX 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 SIX 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 SIX OF THIS SECTION) SHALL BE DEDUCTED LAST.
46. NOTWITHSTANDING THE REPEAL OF THE CREDIT PROVISIONS CONTAINED IN
SECTION TWO HUNDRED TEN OF THIS ARTICLE AND THE ENACTMENT OF THIS
SECTION BY A CHAPTER OF THE LAWS OF TWO THOUSAND FOURTEEN:
(A) A TAXPAYER SHALL BE ALLOWED TO UTILIZE ANY CARRYFORWARD AMOUNTS OF
CREDITS TO WHICH THE TAXPAYER WAS ENTITLED AS OF THE CLOSE OF THE TAXA-
BLE YEAR BEGINNING ON OR AFTER JANUARY FIRST, TWO THOUSAND FOURTEEN AND
BEFORE JANUARY FIRST, TWO THOUSAND FIFTEEN, OTHER THAN THE CARRYFORWARD
AMOUNT OF THE MINIMUM TAX CREDIT PROVIDED UNDER SUBDIVISION THIRTEEN OF
SECTION TWO HUNDRED TEN, AS THAT SUBDIVISION WAS IN EFFECT ON DECEMBER
THIRTY-FIRST, TWO THOUSAND FOURTEEN.
(B) A TAXPAYER SHALL BE REQUIRED IN A TAXABLE YEAR BEGINNING ON OR
AFTER JANUARY FIRST, TWO THOUSAND FIFTEEN, TO RECAPTURE ALL OR A PORTION
OF A CREDIT ALLOWED UNDER A CREDIT PROVISION IN SECTION TWO HUNDRED TEN
FOR A TAXABLE YEAR BEGINNING PRIOR TO JANUARY FIRST, TWO THOUSAND
FIFTEEN IF RECAPTURE WOULD HAVE BEEN REQUIRED UNDER SUCH CREDIT
PROVISION.
S. 6359 103 A. 8559
47. IN ANY TAXABLE YEAR, A TAXPAYER MUST FIRST CLAIM ANY OF THE CRED-
ITS SPECIFIED IN THIS SECTION ON ITS ORIGINALLY FILED REPORT FOR SUCH
TAXABLE YEAR. A TAXPAYER SHALL NOT FIRST CLAIM A CREDIT ON AN AMENDED
REPORT.
S 18. The tax law is amended by adding a new section 210-C to read as
follows:
S 210-C. COMBINED REPORTS. 1. TAX. THE TAX ON A COMBINED REPORT SHALL
BE THE HIGHEST OF THE PRODUCTS OF (I) THE COMBINED BUSINESS INCOME BASE
MULTIPLIED BY THE TAX RATE SPECIFIED IN PARAGRAPH (A) OF SUBDIVISION ONE
OF SECTION TWO HUNDRED TEN OF THIS ARTICLE; (II) THE COMBINED CAPITAL
BASE MULTIPLIED BY THE TAX RATE SPECIFIED IN PARAGRAPH (B) OF SUBDIVI-
SION ONE OF SECTION TWO HUNDRED TEN OF THIS ARTICLE, BUT NOT EXCEEDING
THE LIMITATION PROVIDED FOR IN THAT PARAGRAPH (B); OR (III) THE FIXED
DOLLAR MINIMUM THAT IS ATTRIBUTABLE TO THE DESIGNATED AGENT OF THE
COMBINED GROUP. IN ADDITION, THE TAX ON A COMBINED REPORT SHALL INCLUDE
THE FIXED DOLLAR MINIMUM TAX SPECIFIED IN PARAGRAPH (D) OF SUBDIVISION
ONE OF SECTION TWO HUNDRED TEN OF THIS ARTICLE FOR EACH MEMBER OF THE
COMBINED GROUP, OTHER THAN THE DESIGNATED AGENT, THAT IS A TAXPAYER.
(B) THE COMBINED BUSINESS INCOME BASE IS THE AMOUNT OF THE COMBINED
BUSINESS INCOME OF THE COMBINED GROUP THAT IS APPORTIONED TO THE STATE,
REDUCED BY ANY NET OPERATING LOSS DEDUCTION FOR THE COMBINED GROUP. THE
COMBINED CAPITAL BASE IS THE AMOUNT OF THE COMBINED CAPITAL OF THE
COMBINED GROUP THAT IS APPORTIONED TO THE STATE.
2. COMBINED REPORTS REQUIRED. (A) EXCEPT AS PROVIDED IN PARAGRAPH (C)
OF THIS SUBDIVISION, ANY TAXPAYER (I) WHICH OWNS OR CONTROLS EITHER
DIRECTLY OR INDIRECTLY MORE THAN FIFTY PERCENT OF THE CAPITAL STOCK OF
ONE OR MORE OTHER CORPORATIONS, OR (II) MORE THAN FIFTY PERCENT OF THE
CAPITAL STOCK OF WHICH IS OWNED OR CONTROLLED EITHER DIRECTLY OR INDI-
RECTLY BY ONE OR MORE OTHER CORPORATIONS, OR (III) MORE THAN FIFTY
PERCENT OF THE CAPITAL STOCK OF WHICH AND THE CAPITAL STOCK OF ONE OR
MORE OTHER CORPORATIONS, IS OWNED OR CONTROLLED, DIRECTLY OR INDIRECTLY,
BY THE SAME INTERESTS, AND (IV) THAT IS ENGAGED IN A UNITARY BUSINESS
WITH THOSE CORPORATIONS, SHALL MAKE A COMBINED REPORT WITH THOSE OTHER
CORPORATIONS.
(B) A CORPORATION REQUIRED TO MAKE A COMBINED REPORT WITHIN THE MEAN-
ING OF THIS SECTION SHALL ALSO INCLUDE (I) A CAPTIVE REIT AND A CAPTIVE
RIC IF THE CAPTIVE REIT OR CAPTIVE RIC IS NOT REQUIRED TO BE INCLUDED IN
A COMBINED REPORT UNDER ARTICLE THIRTY-THREE OF THIS CHAPTER; (II) A
COMBINABLE CAPTIVE INSURANCE COMPANY; AND (III) AN ALIEN CORPORATION
THAT SATISFIES THE CONDITIONS IN PARAGRAPH (A) OF THIS SUBDIVISION IF
(I) UNDER ANY PROVISION OF THE INTERNAL REVENUE CODE, THAT CORPORATION
IS TREATED AS A "DOMESTIC CORPORATION" AS DEFINED IN SECTION SEVEN THOU-
SAND SEVEN HUNDRED ONE OF THE INTERNAL REVENUE CODE, OR (II) IT HAS
EFFECTIVELY CONNECTED INCOME FOR THE TAXABLE YEAR PURSUANT TO CLAUSE
(IV) OF THE OPENING PARAGRAPH OF SUBDIVISION NINE OF SECTION TWO HUNDRED
EIGHT OF THIS ARTICLE.
(C) A CORPORATION REQUIRED OR PERMITTED TO MAKE A COMBINED REPORT
UNDER THIS SECTION DOES NOT INCLUDE (I) A CORPORATION THAT IS TAXABLE
UNDER ARTICLE NINE OR THIRTY-THREE OF THIS CHAPTER; (II) A REIT THAT IS
NOT A CAPTIVE REIT, AND A RIC THAT IS NOT A CAPTIVE RIC; (III) A NEW
YORK S CORPORATION; (IV) A CORPORATION THAT IS SUBJECT TO TAX UNDER THIS
ARTICLE SOLELY AS A RESULT OF ITS OWNERSHIP OF A LIMITED PARTNER INTER-
EST IN A LIMITED PARTNERSHIP THAT IS DOING BUSINESS, EMPLOYING CAPITAL,
OWNING OR LEASING PROPERTY, MAINTAINING AN OFFICE IN THIS STATE, OR
DERIVING RECEIPTS FROM ACTIVITY IN THIS STATE, PROVIDED THAT THE CORPO-
RATION IS NOT OTHERWISE REQUIRED TO FILE A COMBINED REPORT PURSUANT TO
S. 6359 104 A. 8559
THIS SECTION; OR (V) AN ALIEN CORPORATION THAT HAS NO EFFECTIVELY
CONNECTED INCOME FOR THE TAXABLE YEAR PURSUANT TO CLAUSE (IV) OF THE
OPENING PARAGRAPH OF SUBDIVISION NINE OF SECTION TWO HUNDRED EIGHT OF
THIS ARTICLE.
(D) A COMBINED REPORT SHALL BE FILED BY THE DESIGNATED AGENT OF THE
COMBINED GROUP AS DETERMINED UNDER SUBDIVISION SEVEN OF THIS SECTION.
3. COMMONLY OWNED GROUP ELECTION. (A) SUBJECT TO THE PROVISIONS OF
PARAGRAPH (C) OF SUBDIVISION TWO OF THIS SECTION, A TAXPAYER MAY ELECT
TO TREAT AS ITS COMBINED GROUP ALL CORPORATIONS THAT MEET THE OWNERSHIP
REQUIREMENTS DESCRIBED IN PARAGRAPH (A) OF SUBDIVISION TWO OF THIS
SECTION (SUCH CORPORATIONS COLLECTIVELY REFERRED TO IN THIS SUBDIVISION
AS THE "COMMONLY OWNED GROUP"). IF THAT ELECTION IS MADE, THE COMMONLY
OWNED GROUP SHALL CALCULATE THE COMBINED BUSINESS INCOME, COMBINED CAPI-
TAL, AND FIXED DOLLAR MINIMUM BASES OF ALL MEMBERS OF THE GROUP IN
ACCORDANCE WITH PARAGRAPH FOUR OF THIS SUBDIVISION, WHETHER OR NOT THAT
BUSINESS INCOME OR BUSINESS CAPITAL IS FROM A SINGLE UNITARY BUSINESS.
(B) THE ELECTION UNDER THIS SUBDIVISION SHALL BE MADE ON AN ORIGINAL,
TIMELY FILED RETURN OF THE COMBINED GROUP. ANY CORPORATION ENTERING A
COMMONLY OWNED GROUP SUBSEQUENT TO THE YEAR OF ELECTION SHALL BE
INCLUDED IN THE COMBINED GROUP AND IS CONSIDERED TO HAVE WAIVED ANY
OBJECTION TO ITS INCLUSION IN THE COMBINED GROUP.
(C) THE ELECTION SHALL BE IRREVOCABLE, AND BINDING FOR AND APPLICABLE
TO THE TAXABLE YEAR FOR WHICH IT IS MADE AND FOR THE NEXT SIX TAXABLE
YEARS. THE ELECTION WILL AUTOMATICALLY BE RENEWED FOR ANOTHER SEVEN
TAXABLE YEARS AFTER IT HAS BEEN IN EFFECT FOR SEVEN TAXABLE YEARS UNLESS
IT IS AFFIRMATIVELY REVOKED. THE REVOCATION SHALL BE MADE ON AN
ORIGINAL, TIMELY FILED RETURN FOR THE FIRST TAXABLE YEAR AFTER THE
COMPLETION OF A SEVEN YEAR PERIOD FOR WHICH AN ELECTION UNDER THIS
SUBDIVISION WAS IN PLACE. IN THE CASE OF A REVOCATION, A NEW ELECTION
UNDER THIS SUBDIVISION SHALL NOT BE PERMITTED IN ANY OF THE IMMEDIATELY
FOLLOWING THREE TAXABLE YEARS. IN DETERMINING THE SEVEN AND THREE YEAR
PERIODS DESCRIBED IN THIS PARAGRAPH, SHORT TAXABLE YEARS SHALL NOT BE
CONSIDERED OR COUNTED.
4. COMPUTATION OF TAX BASES ON A COMBINED REPORT. (A) IN COMPUTING THE
TAX BASES FOR A COMBINED REPORT, THE COMBINED GROUP SHALL GENERALLY BE
TREATED AS A SINGLE CORPORATION, EXCEPT AS OTHERWISE PROVIDED, AND
SUBJECT TO ANY REGULATIONS OR GUIDANCE ISSUED BY THE COMMISSIONER OR THE
DEPARTMENT.
(B)(I) IN COMPUTING COMBINED BUSINESS INCOME, ALL INTERCORPORATE DIVI-
DENDS SHALL BE ELIMINATED, AND ALL OTHER INTERCORPORATE TRANSACTIONS
SHALL BE DEFERRED IN A MANNER SIMILAR TO THE RULES RELATING TO INTERCOM-
PANY TRANSACTIONS UNDER SECTION FIFTEEN HUNDRED TWO OF THE INTERNAL
REVENUE CODE.
(II) IN COMPUTING COMBINED CAPITAL, ALL INTERCORPORATE STOCKHOLDINGS,
INTERCORPORATE BILLS, INTERCORPORATE NOTES RECEIVABLE AND PAYABLE,
INTERCORPORATE ACCOUNTS RECEIVABLE AND PAYABLE, AND OTHER INTERCORPORATE
INDEBTEDNESS, SHALL BE ELIMINATED.
(C) QUALIFICATION FOR CREDITS, INCLUDING ANY LIMITATIONS THEREON,
SHALL BE DETERMINED SEPARATELY FOR EACH OF THE MEMBERS OF THE COMBINED
GROUP, AND SHALL NOT BE DETERMINED ON A COMBINED GROUP BASIS, EXCEPT AS
OTHERWISE PROVIDED. HOWEVER, THE CREDITS SHALL BE APPLIED AGAINST THE
COMBINED TAX OF THE GROUP.
(D)(I) A NET OPERATING LOSS DEDUCTION IS ALLOWED IN COMPUTING THE
COMBINED BUSINESS INCOME BASE. SUCH DEDUCTION MAY REDUCE THE TAX ON THE
COMBINED BUSINESS INCOME BASE TO THE HIGHER OF THE TAX ON THE COMBINED
CAPITAL BASE OR THE FIXED DOLLAR MINIMUM. A COMBINED NET OPERATING LOSS
S. 6359 105 A. 8559
DEDUCTION IS EQUAL TO THE AMOUNT OF COMBINED NET OPERATING LOSS OR LOSS-
ES FROM ONE OR MORE TAXABLE YEARS THAT ARE CARRIED FORWARD TO A PARTIC-
ULAR INCOME YEAR. A COMBINED NET OPERATING LOSS IS THE COMBINED BUSINESS
LOSS INCURRED IN A PARTICULAR TAXABLE YEAR MULTIPLIED BY THE COMBINED
APPORTIONMENT FRACTION FOR THAT YEAR DETERMINED AS PROVIDED IN SUBDIVI-
SION FIVE OF THIS SECTION.
(II) THE COMBINED NET OPERATING LOSS DEDUCTION AND COMBINED NET OPER-
ATING LOSS ARE ALSO SUBJECT TO THE PROVISIONS CONTAINED IN CLAUSES ONE
THROUGH SIX OF SUBPARAGRAPH (VIII) OF PARAGRAPH (A) OF SUBDIVISION ONE
OF SECTION TWO HUNDRED TEN OF THIS ARTICLE.
(III) IN THE CASE OF A CORPORATION THAT FILES A COMBINED REPORT,
EITHER IN THE YEAR THE NET OPERATING LOSS IS INCURRED OR IN THE YEAR IN
WHICH A DEDUCTION IS CLAIMED ON ACCOUNT OF THE LOSS, THE COMBINED NET
OPERATING LOSS DEDUCTION IS DETERMINED AS IF THE COMBINED GROUP IS A
SINGLE CORPORATION AND IS SUBJECT TO THE SAME LIMITATIONS THAT WOULD
APPLY FOR FEDERAL INCOME TAX PURPOSES UNDER THE INTERNAL REVENUE CODE
AND THE CODE OF FEDERAL REGULATIONS AS IF SUCH CORPORATION HAD FILED FOR
SUCH TAXABLE YEAR A CONSOLIDATED FEDERAL INCOME TAX RETURN WITH THE SAME
CORPORATIONS INCLUDED IN THE COMBINED REPORT. IF A CORPORATION FILES A
COMBINED REPORT, REGARDLESS OF WHETHER IT FILED A SEPARATE RETURN OR
CONSOLIDATED RETURN FOR FEDERAL INCOME TAX PURPOSES, THE NET OPERATING
LOSS AND NET OPERATING LOSS DEDUCTION FOR THE COMBINED GROUP MUST BE
COMPUTED AS IF THE CORPORATION HAD FILED A CONSOLIDATED RETURN FOR THE
SAME CORPORATIONS FOR FEDERAL INCOME TAX PURPOSES.
(IV) IN GENERAL, ANY NET OPERATING LOSS CARRYOVER FROM A YEAR IN WHICH
A COMBINED REPORT WAS FILED SHALL BE BASED ON THE COMBINED NET OPERATING
LOSS OF THE GROUP OF CORPORATIONS FILING SUCH REPORT. THE PORTION OF THE
COMBINED LOSS ATTRIBUTABLE TO ANY MEMBER OF THE GROUP THAT FILES A SEPA-
RATE REPORT FOR A SUCCEEDING TAXABLE YEAR WILL BE AN AMOUNT BEARING THE
SAME RELATION TO THE COMBINED LOSS AS THE NET OPERATING LOSS OF SUCH
CORPORATION BEARS TO THE TOTAL NET OPERATING LOSS OF ALL MEMBERS OF THE
GROUP HAVING SUCH LOSSES TO THE EXTENT THAT THEY ARE TAKEN INTO ACCOUNT
IN COMPUTING THE COMBINED NET OPERATING LOSS.
(E) ANY ELECTION MADE PURSUANT TO PARAGRAPH (B) OF SUBDIVISION SIX,
AND PARAGRAPHS (B) AND (C) OF SUBDIVISION SIX-A OF SECTION TWO HUNDRED
EIGHT OF THIS ARTICLE SHALL APPLY TO ALL MEMBERS OF THE COMBINED GROUP.
(F)(I) IN THE CASE OF A CAPTIVE REIT OR CAPTIVE RIC REQUIRED UNDER
THIS SECTION TO BE INCLUDED IN A COMBINED REPORT, ENTIRE NET INCOME
SHALL BE COMPUTED AS REQUIRED UNDER SUBDIVISION FIVE (IN THE CASE OF A
CAPTIVE REIT) OR SUBDIVISION SEVEN (IN THE CASE OF A CAPTIVE RIC) OF
SECTION TWO HUNDRED NINE OF THIS ARTICLE. HOWEVER, THE DEDUCTION UNDER
THE INTERNAL REVENUE CODE FOR DIVIDENDS PAID BY THE CAPTIVE REIT OR
CAPTIVE RIC TO ANY MEMBER OF THE AFFILIATED GROUP THAT INCLUDES THE
CORPORATION THAT DIRECTLY OR INDIRECTLY OWNS OVER FIFTY PERCENT OF THE
VOTING STOCK OF THE CAPTIVE REIT OR CAPTIVE RIC SHALL NOT BE ALLOWED.
FOR PURPOSES OF THIS SUBPARAGRAPH, THE TERM "AFFILIATED GROUP" MEANS
"AFFILIATED GROUP" AS DEFINED IN SECTION FIFTEEN HUNDRED FOUR OF THE
INTERNAL REVENUE CODE, BUT WITHOUT REGARD TO THE EXCEPTIONS PROVIDED FOR
IN SUBSECTION (B) OF THAT SECTION.
(II) IN THE CASE OF A COMBINABLE CAPTIVE INSURANCE COMPANY REQUIRED
UNDER THIS SECTION TO BE INCLUDED IN A COMBINED REPORT, ENTIRE NET
INCOME SHALL BE COMPUTED AS REQUIRED BY SUBDIVISION NINE OF SECTION TWO
HUNDRED EIGHT OF THIS ARTICLE.
5. APPORTIONMENT ON A COMBINED REPORT. (A) IN DETERMINING THE APPOR-
TIONMENT FACTOR FOR A COMBINED REPORT, THE RECEIPTS, NET INCOME, NET
GAINS AND OTHER ITEMS OF ALL MEMBERS OF THE COMBINED GROUP, WHETHER OR
S. 6359 106 A. 8559
NOT THEY ARE A TAXPAYER, ARE INCLUDED AND INTERCORPORATE RECEIPTS,
INCOME AND GAINS ARE ELIMINATED. RECEIPTS, NET INCOME, NET GAINS AND
OTHER ITEMS ARE SOURCED AS PROVIDED IN SECTION TWO HUNDRED TEN-A OF THIS
ARTICLE.
(B) AN ELECTION MADE TO APPORTION INCOME AND GAINS FROM QUALIFYING
FINANCIAL INSTRUMENTS PURSUANT TO SUBPARAGRAPH ONE OF PARAGRAPH (A) OF
SUBDIVISION FIVE OF SECTION TWO HUNDRED TEN-A OF THIS ARTICLE SHALL
APPLY TO ALL MEMBERS OF THE COMBINED GROUP.
6. LIABILITY OF COMBINED GROUP MEMBERS. EVERY MEMBER OF THE COMBINED
GROUP THAT IS SUBJECT TO TAX UNDER THIS ARTICLE SHALL BE JOINTLY AND
SEVERALLY LIABLE FOR THE TAX DUE PURSUANT TO A COMBINED REPORT.
7. DESIGNATED AGENT. EACH COMBINED GROUP SHALL HAVE ONE DESIGNATED
AGENT, WHICH SHALL BE A TAXPAYER. THE DESIGNATED AGENT IS THE PARENT
CORPORATION OF THE COMBINED GROUP. IF THERE IS NO SUCH PARENT CORPO-
RATION, OR THE PARENT CORPORATION IS NOT A TAXPAYER, THEN ANOTHER MEMBER
OF THE COMBINED GROUP THAT IS A TAXPAYER MAY BE APPOINTED AS THE DESIG-
NATED AGENT. ONLY THE DESIGNATED AGENT MAY ACT ON BEHALF OF THE MEMBERS
OF THE COMBINED GROUP FOR MATTERS RELATING TO THE COMBINED REPORT.
S 19. Subdivisions 2-a, 3, 4 and 5 of section 211 of the tax law,
subdivision 2-a as added and subdivision 5 as amended by chapter 817 of
the laws of 1987, subdivision 3 as amended by chapter 770 of the laws of
1992, subdivision 4 as amended by section 2 of part T of chapter 407 of
the laws of 1999, the opening paragraph and the second undesignated
paragraph of paragraph (a) of subdivision 4 as amended by section 1,
subparagraph 4 of paragraph (a) of subdivision 4 as amended by section
2, and subparagraph 5 of paragraph (a) of subdivision 4 as amended by
section 3 of part J of chapter 60 of the laws of 2007, subparagraph 6 of
paragraph (a) of subdivision 4 as added by section 3 of part FF1 of
chapter 57 of the laws of 2008, subparagraph 7 of paragraph (a) of
subdivision 4 as added by section 2 and subparagraph 1 of paragraph (b)
of subdivision 4 as amended by section 3 of part E1 of chapter 57 of the
laws of 2009, are amended to read as follows:
2-a. The [tax commission] COMMISSIONER may prescribe regulations and
instructions requiring returns of information to be made and filed in
conjunction with the reports required to be filed pursuant to [section
two hundred eleven] THIS ARTICLE, relating to payments made to share-
holders owning, directly or indirectly, individually or in the aggre-
gate, more than fifty percent of the issued capital stock of the taxpay-
er, where such payments are treated as payments of interest in the
computation of entire net income [or minimum taxable income] reported on
such reports.
3. If the amount of taxable income [or alternative minimum taxable
income] for any year of any taxpayer (including any taxpayer which has
elected to be taxed under subchapter s of chapter one of the internal
revenue code), as returned to the United States treasury department is
changed or corrected by the commissioner of internal revenue or other
officer of the United States or other competent authority, or where a
renegotiation of a contract or subcontract with the United States
results in a change in taxable income [or alternative minimum taxable
income], such taxpayer shall report such changed or corrected taxable
income [or alternative minimum taxable income], or the results of such
renegotiation, within ninety days (or one hundred twenty days, in the
case of a taxpayer making a combined report under this article for such
year) after the final determination of such change or correction or
renegotiation, or as required by the commissioner, and shall concede the
accuracy of such determination or state wherein it is erroneous. The
S. 6359 107 A. 8559
allowance of a tentative carryback adjustment based upon a net operating
loss carryback or net capital loss carryback pursuant to section sixty-
four hundred eleven of the internal revenue code, as amended, shall be
treated as a final determination for purposes of this subdivision. Any
taxpayer filing an amended return with such department shall also file
within ninety days (OR ONE HUNDRED TWENTY DAYS, IN THE CASE OF A TAXPAY-
ER MAKING A COMBINED REPORT UNDER THIS ARTICLE FOR SUCH YEAR) thereafter
an amended report with the commissioner.
4. [(a) Combined reports permitted or required. Any taxpayer, which
owns or controls either directly or indirectly substantially all the
capital stock of one or more other corporations, or substantially all
the capital stock of which is owned or controlled either directly or
indirectly by one or more other corporations or by interests which own
or control either directly or indirectly substantially all the capital
stock of one or more other corporations, (hereinafter referred to in
this paragraph as "related corporations"), shall make a combined report
covering any related corporations if there are substantial intercorpo-
rate transactions among the related corporations, regardless of the
transfer price for such intercorporate transactions. It is not necessary
that there be substantial intercorporate transactions between any one
corporation and every other related corporation. It is necessary, howev-
er, that there be substantial intercorporate transactions between the
taxpayer and a related corporation or collectively, a group of such
related corporations. The report shall set forth such information as the
commissioner may require, subject to the provisions of subparagraphs one
through five of this paragraph.
In determining whether there are substantial intercorporate trans-
actions, the commissioner shall consider and evaluate all activities and
transactions of the taxpayer and its related corporations. Activities
and transactions that will be considered include, but are not limited
to: (i) manufacturing, acquiring goods or property, or performing
services, for related corporations; (ii) selling goods acquired from
related corporations; (iii) financing sales of related corporations;
(iv) performing related customer services using common facilities and
employees for related corporations; (v) incurring expenses that benefit,
directly or indirectly, one or more related corporations, and (vi)
transferring assets, including such assets as accounts receivable,
patents or trademarks from one or more related corporations.
(1) Any corporation which owns or controls either directly or indi-
rectly substantially all the capital stock of a DISC not exempt from tax
under paragraph (i) of subdivision nine of section two hundred eight of
this article shall be allowed, at the election of such corporation, to
make a report on a combined basis covering such DISC, but the failure of
such corporation to make such election shall not prohibit the commis-
sioner from requiring a combined report covering such corporation and
such DISC.
(2)(i) No taxpayer may be permitted to make a report on a combined
basis covering any such other corporations where such taxpayer or any
such other corporation allocates in accordance with clause (A) of
subparagraph seven of paragraph (a) of subdivision three of section two
hundred ten of this article (relating to aviation corporations) and such
taxpayer or any such other corporation does not so allocate, unless such
taxpayer or such other corporation is a qualified air freight forwarder
with respect to such other corporation or such taxpayer, respectively,
and all taxpayers included on such combined report elect, by filing such
S. 6359 108 A. 8559
combined report, to have such qualified air freight forwarder so
included.
(ii) A corporation is a qualified air freight forwarder with respect
to another corporation:
(A) if it owns or controls either directly or indirectly all of the
capital stock of such other corporation, or if all of its capital stock
is owned or controlled either directly or indirectly by such other
corporation, or if all of the capital stock of both corporations is
owned or controlled either directly or indirectly by the same interests,
(B) if it is principally engaged in the business of air freight
forwarding, and
(C) if its air freight forwarding business is carried on principally
with the airline or airlines operated by such other corporation.
(3) No taxpayer may be permitted to make a report on a combined basis
covering any such other corporations where such taxpayer or any such
other corporation allocates in accordance with subparagraph eight of
paragraph (a) of subdivision three of section two hundred ten of this
article (relating to railroad and trucking corporations) and such
taxpayer or any such other corporation does not so allocate.
(4) Except as provided in the first undesignated paragraph of this
paragraph, no combined report covering any corporation shall be required
unless the commissioner deems such a report necessary, because of
inter-company transactions or some agreement, understanding, arrangement
or transaction referred to in subdivision five of this section, in order
properly to reflect the tax liability under this article.
(5) A corporation organized under the laws of a country other than the
United States shall not be required or permitted to make a report on a
combined basis.
(6) (i) For purposes of this subparagraph, the term "closest control-
ling stockholder" means the corporation that indirectly owns or controls
over fifty percent of the voting stock of a captive REIT or captive RIC,
is subject to tax under this article, article thirty-two or thirty-three
of this chapter or otherwise required to be included in a combined
return or report under this article, article thirty-two or thirty-three
of this chapter, and is the fewest tiers of corporations away in the
ownership structure from the captive REIT or captive RIC. The commis-
sioner is authorized to prescribe by regulation or published guidance
the criteria for determining the closest controlling stockholder.
(ii) A captive REIT or a captive RIC must be included in a combined
report with the corporation that directly owns or controls over fifty
percent of the voting stock of the captive REIT or captive RIC if that
corporation is subject to tax or required to be included in a combined
report under this article.
(iii) If over fifty percent of the voting stock of a captive REIT or
captive RIC is not directly owned or controlled by a corporation that is
subject to tax or required to be included in a combined report under
this article, then the captive REIT or captive RIC must be included in a
combined return or report with the corporation that is the closest
controlling stockholder of the captive REIT or captive RIC. If the clos-
est controlling stockholder of the captive REIT or captive RIC is
subject to tax or otherwise required to be included in a combined report
under this article, then the captive REIT or captive RIC must be
included in a combined report under this article.
(iv) If the corporation that directly owns or controls the voting
stock of the captive REIT or captive RIC is described in subparagraph
two, three or five of this paragraph as a corporation not permitted to
S. 6359 109 A. 8559
make a combined report, then the provisions in clause (iii) of this
subparagraph must be applied to determine the corporation in whose
combined return or report the captive REIT or captive RIC should be
included. If, under clause (iii) of this subparagraph, the corporation
that is the closest controlling stockholder of the captive REIT or
captive RIC is described in subparagraph two, three or five of this
paragraph as a corporation not permitted to make a combined return, then
that corporation is deemed to not be in the ownership structure of the
captive REIT or captive RIC, and the closest controlling stockholder
will be determined without regard to that corporation.
(v) If a captive REIT owns the stock of a qualified REIT subsidiary
(as defined in paragraph two of subsection (i) of section eight hundred
fifty-six of the internal revenue code), then the qualified REIT subsid-
iary must be included in a combined report with the captive REIT.
(vi) If a captive REIT or a captive RIC is required under this subpar-
agraph to be included in a combined report with another corporation, and
that other corporation is also required to be included in a combined
report with another related corporation or corporations under this para-
graph, then the captive REIT or the captive RIC must be included in that
combined report with those corporations.
(vii) If a captive REIT or a captive RIC is not required to be
included in a combined report with another corporation under clause (ii)
or (iii) of this subparagraph, or in a combined return under the
provisions of either subparagraph (v) of paragraph two of subsection (f)
of section fourteen hundred sixty-two or paragraph four of subdivision
(f) of section fifteen hundred fifteen of this chapter, then the captive
REIT or captive RIC is subject to the opening provisions of this para-
graph and the provisions of subparagraph four of this paragraph. The
captive REIT or captive RIC must be included in a combined report under
this article with another corporation if either the substantial inter-
corporate transactions requirement in the opening provisions of this
paragraph or the inter-company transactions or agreement, understanding,
arrangement or transaction requirement of subparagraph four of this
paragraph is satisfied and more than fifty percent of the voting stock
of the captive REIT or the captive RIC and substantially all of the
capital stock of that other corporation are owned and controlled,
directly or indirectly, by the same corporation.
(7) (i) For purposes of this subparagraph, the term "closest control-
ling stockholder" means the corporation that indirectly owns or controls
over fifty percent of the voting stock of an overcapitalized captive
insurance company; is subject to tax under this article or article thir-
ty-two of this chapter, or is otherwise required to be included in a
combined return or report under this article or article thirty-two of
this chapter; and is the fewest tiers of corporations away in the owner-
ship structure from the overcapitalized captive insurance company. The
commissioner is authorized to prescribe by regulation or published guid-
ance the criteria for determining the closest controlling stockholder.
(ii) An overcapitalized captive insurance company must be included in
a combined report with the corporation that directly owns or controls
over fifty percent of the voting stock of the overcapitalized captive
insurance company if that corporation is subject to tax or required to
be included in a combined report under this article.
(iii) If over fifty percent of the voting stock of an overcapitalized
captive insurance company is not directly owned or controlled by a
corporation that is subject to tax or required to be included in a
combined report under this article, then the overcapitalized captive
S. 6359 110 A. 8559
insurance company must be included in a combined return or report with
the corporation that is the closest controlling stockholder of the over-
capitalized captive insurance company. If the closest controlling stock-
holder of the overcapitalized captive insurance company is subject to
tax or otherwise required to be included in a combined report under this
article, then the overcapitalized captive insurance company must be
included in a combined report under this article.
(iv) If the corporation that directly owns or controls the voting
stock of the overcapitalized captive insurance company is described in
subparagraph two, three, or five of this paragraph as a corporation not
permitted to make a combined report, then the provisions in clause (iii)
of this subparagraph must be applied to determine the corporation in
whose combined return or report the overcapitalized captive insurance
company should be included. If, under clause (iii) of this subparagraph,
the corporation that is the closest controlling stockholder of the over-
capitalized captive insurance company is described in subparagraph two,
three or five of this paragraph as a corporation not permitted to make a
combined return, then that corporation is deemed not to be in the owner-
ship structure of the overcapitalized captive insurance company, and the
closest controlling stockholder will be determined without regard to
that corporation.
(v) If an overcapitalized captive insurance company is required under
this subparagraph to be included in a combined report with another
corporation, and that other corporation is also required to be included
in a combined report with another related corporation or corporations
under this paragraph, then the overcapitalized captive insurance company
must be included in that combined report with those corporations.
(vi) If an overcapitalized captive insurance company is not required
to be included in a combined report with another corporation under
clause (ii) or (iii) of this subparagraph, or in a combined return under
the provisions of subparagraph (v) of paragraph two of subsection (f) of
section fourteen hundred sixty-two of this chapter, then the overcapi-
talized captive insurance company is subject to the opening provisions
of this paragraph and the provisions of subparagraph four of this para-
graph. The overcapitalized captive insurance company must be included in
a combined report under this article with another corporation if either
the substantial intercorporate transactions requirement in the opening
provisions of this paragraph or the inter-company transactions or agree-
ment, understanding, arrangement or transaction requirement of subpara-
graph four of this paragraph is satisfied, and both more than fifty
percent of the voting stock of the overcapitalized captive insurance
company and substantially all of the capital stock of that other corpo-
ration are owned and controlled, directly or indirectly, by the same
corporation.
(b) Computation. (1) Tax. (i) In the case of a combined report the tax
shall be measured by the combined entire net income, combined minimum
taxable income, combined pre-nineteen hundred ninety minimum taxable
income or combined capital, of all the corporations included in the
report, including any captive REIT, captive RIC or overcapitalized
captive insurance company; provided, however, in no event shall the tax
measured by combined capital exceed the limitation provided for in para-
graph (b) of subdivision one of section two hundred ten of this article.
(ii) In the case of a captive REIT or captive RIC required under this
subdivision to be included in a combined report, entire net income must
be computed as required under subdivision five (in the case of a captive
REIT) or subdivision seven (in the case of a captive RIC) of section two
S. 6359 111 A. 8559
hundred nine of this article. However, the deduction under the internal
revenue code for dividends paid by the captive REIT or captive RIC to
any member of the affiliated group that includes the corporation that
directly or indirectly owns over fifty percent of the voting stock of
the captive REIT or captive RIC shall not be allowed for taxable years
beginning on or after January first, two thousand eight. The term
"affiliated group" means "affiliated group" as defined in section
fifteen hundred four of the internal revenue code, but without regard to
the exceptions provided for in subsection (b) of that section.
(iii) In the case of an overcapitalized captive insurance company
required under this subdivision to be included in a combined report,
entire net income must be computed as required by subdivision nine of
section two hundred eight of this article.
(2) Tax bases. In computing combined entire net income, combined mini-
mum taxable income or combined pre-nineteen hundred ninety minimum taxa-
ble income intercorporate dividends shall be eliminated, in computing
combined business and investment capital intercorporate stockholdings
and intercorporate bills, notes and accounts receivable and payable and
other intercorporate indebtedness shall be eliminated and in computing
combined subsidiary capital intercorporate stockholdings shall be elimi-
nated, provided, however, that intercorporate dividends from a DISC or a
former DISC not exempt from tax under paragraph (i) of subdivision nine
of section two hundred eight of this article which are taxable as busi-
ness income under this article shall not be eliminated.
(3) Air freight forwarders: allocation. Notwithstanding any provision
of law to the contrary, where a combined report includes a qualified air
freight forwarder and a corporation described in subparagraph seven of
paragraph (a) of subdivision three of section two hundred ten of this
chapter (relating to aviation corporations), in computing the combined
business allocation percentage such subparagraph seven shall be applied
with respect to such qualified air freight forwarder] FOR PROVISIONS
RELATING TO COMBINED REPORTS, SEE SECTION TWO HUNDRED TEN-C OF THIS
ARTICLE.
5. In case it shall appear to the [tax commission] COMMISSIONER that
any agreement, understanding or arrangement exists between the taxpayer
and any other corporation or any person or firm, whereby the activity,
business, income or capital of the taxpayer within the state is improp-
erly or inaccurately reflected, the [tax commission] COMMISSIONER is
authorized and empowered, in [its] THE COMMISSIONER'S discretion and in
such manner as [it] THE COMMISSIONER may determine, to adjust items of
income, deductions and capital, and to eliminate assets in computing any
[allocation] APPORTIONMENT percentage provided only that any income
directly traceable thereto be also excluded from entire net income,
[minimum taxable income or pre-nineteen hundred ninety minimum taxable
income,] so as equitably to determine the tax. Where (a) any taxpayer
conducts its activity or business under any agreement, arrangement or
understanding in such manner as either directly or indirectly to benefit
its members or stockholders, or any of them, or any person or persons
directly or indirectly interested in such activity or business, by
entering into any transaction at more or less than a fair price which,
but for such agreement, arrangement or understanding, might have been
paid or received therefor, or (b) any taxpayer, a substantial portion of
whose capital stock is owned either directly or indirectly by another
corporation, enters into any transaction with such other corporation on
such terms as to create an improper loss or net income, the [tax commis-
sion] COMMISSIONER may include in the entire net income[, minimum taxa-
S. 6359 112 A. 8559
ble income or pre-nineteen hundred ninety minimum taxable income] of the
taxpayer the fair profits which, but for such agreement, arrangement or
understanding, the taxpayer might have derived from such transaction.
WHERE ANY TAXPAYER OWNS, DIRECTLY OR INDIRECTLY, MORE THAN FIFTY PERCENT
OF THE CAPITAL STOCK OF ANOTHER CORPORATION SUBJECT TO TAX UNDER SECTION
FIFTEEN HUNDRED TWO-A OF THIS CHAPTER AND FIFTY PERCENT OR LESS OF WHOSE
GROSS RECEIPTS FOR THE TAXABLE YEAR CONSIST OF PREMIUMS, THE COMMISSION-
ER MAY INCLUDE IN THE ENTIRE NET INCOME OF THE TAXPAYER, AS A DEEMED
DISTRIBUTION, THE AMOUNT OF THE NET INCOME OF THE OTHER CORPORATION THAT
IS IN EXCESS OF ITS NET PREMIUM INCOME.
S 19-a. Subdivision 13 of section 211 of the tax law is REPEALED.
S 20. Subdivision 11 of section 2 of the tax law, as added by section
1 of part E-1 of chapter 57 of the laws of 2009, is amended to read as
follows:
11. The term "[overcapitalized] COMBINABLE captive insurance company"
means an entity that is treated as an association taxable as a corpo-
ration under the internal revenue code (a) more than fifty percent of
the voting stock of which is owned or controlled, directly or indirect-
ly, by a single entity that is treated as an association taxable as a
corporation under the internal revenue code and not exempt from federal
income tax; (b) that is licensed as a captive insurance company under
the laws of this state or another jurisdiction; AND (c) whose business
includes providing, directly and indirectly, insurance or reinsurance
covering the risks of its parent and/or members of its affiliated
group[; and (d) fifty percent or less of whose gross receipts for the
taxable year consist of premiums]. For purposes of this subdivision,
"affiliated group" has the same meaning as that term is given in section
1504 of the internal revenue code, except that the term "common parent
corporation" in that section is deemed to mean any person, as defined in
section 7701 of the internal revenue code[;] AND references to "at least
eighty percent" in section 1504 of the internal revenue code are to be
read as "fifty percent or more;" section 1504 of the internal revenue
code is to be read without regard to the exclusions provided for in
subsection (b) of that section[; "premiums" has the same meaning as that
term is given in paragraph one of subdivision (c) of section fifteen
hundred ten of this chapter, except that it includes consideration for
annuity contracts and excludes any part of the consideration for insur-
ance, reinsurance or annuity contracts that do not provide bona fide
insurance, reinsurance or annuity benefits; and "gross receipts"
includes the amounts included in gross receipts for purposes of section
501(c) (15) of the internal revenue code, except that those amounts also
include all premiums as defined in this subdivision].
S 21. Subdivision (a) of section 1500 of the tax law, as separately
amended by section 1 of part B-1 and section 8 of part E-1 of chapter 57
of the laws of 2009, is amended to read as follows:
(a) The term "insurance corporation" includes a corporation, associ-
ation, joint stock company or association, person, society, aggregation
or partnership, by whatever name known, doing an insurance business,
and, notwithstanding the provisions of section fifteen hundred twelve of
this article, shall include (1) a risk retention group as defined in
subsection (n) of section five thousand nine hundred two of the insur-
ance law, (2) the state insurance fund and (3) a corporation, associ-
ation, joint stock company or association, person, society, aggregation
or partnership doing an insurance business as a member of the New York
insurance exchange described in section six thousand two hundred one of
the insurance law. The definition of the "state insurance fund"
S. 6359 113 A. 8559
contained in this subdivision shall be limited in its effect to the
provisions of this article and the related provisions of this chapter
and shall have no force and effect other than with respect to such
provisions. The term "insurance corporation" shall also include a
captive insurance company doing a captive insurance business, as defined
in subsections (c) and (b), respectively, of section seven thousand two
of the insurance law; provided, however, "insurance corporation" shall
not include the metropolitan transportation authority, or a public bene-
fit corporation or not-for-profit corporation formed by a city with a
population of one million or more pursuant to subsection (a) of section
seven thousand five of the insurance law, each of which is expressly
exempt from the payment of fees, taxes or assessments, whether state or
local; and provided further "insurance corporation" does not include any
[overcapitalized] COMBINABLE captive insurance company. The term "insur-
ance corporation" shall also include an unauthorized insurer operating
from an office within the state, pursuant to paragraph five of
subsection (b) of section one thousand one hundred one and subsection
(i) of section two thousand one hundred seventeen of the insurance law.
The term "insurance corporation" also includes a health maintenance
organization required to obtain a certificate of authority under article
forty-four of the public health law.
S 22. Subdivision (a) of section 1502-b of the tax law, as amended by
section 9 of part E-1 of chapter 57 of the laws of 2009 and as further
amended by section 104 of part A of chapter 62 of the laws of 2011, is
amended to read as follows:
(a) In lieu of the taxes and tax surcharge imposed by sections fifteen
hundred one, fifteen hundred two-a, fifteen hundred five-a, and fifteen
hundred ten of this article, every captive insurance company licensed by
the superintendent of financial services pursuant to the provisions of
article seventy of the insurance law, other than the metropolitan trans-
portation authority and a public benefit corporation or not-for-profit
corporation formed by a city with a population of one million or more
pursuant to subsection (a) of section seven thousand five of the insur-
ance law, each of which is expressly exempt from the payment of fees,
taxes or assessments whether state or local, and other than [an overcap-
italized] COMBINABLE captive insurance company, shall, for the privilege
of exercising its corporate franchise, pay a tax on (1) all gross direct
premiums, less return premiums thereon, written on risks located or
resident in this state and (2) all assumed reinsurance premiums, less
return premiums thereon, written on risks located or resident in this
state. The rate of the tax imposed on gross direct premiums shall be
four-tenths of one percent on all or any part of the first twenty
million dollars of premiums, three-tenths of one percent on all or any
part of the second twenty million dollars of premiums, two-tenths of one
percent on all or any part of the third twenty million dollars of premi-
ums, and seventy-five thousandths of one percent on each dollar of
premiums thereafter. The rate of the tax on assumed reinsurance premiums
shall be two hundred twenty-five thousandths of one percent on all or
any part of the first twenty million dollars of premiums, one hundred
and fifty thousandths of one percent on all or any part of the second
twenty million dollars of premiums, fifty thousandths of one percent on
all or any part of the third twenty million dollars of premiums and
twenty-five thousandths of one percent on each dollar of premiums there-
after. The tax imposed by this section shall be equal to the greater of
(i) the sum of the tax imposed on gross direct premiums and the tax
imposed on assumed reinsurance premiums or (ii) five thousand dollars.
S. 6359 114 A. 8559
S 23. Paragraph 4 of subdivision (f) of section 1515 of the tax law,
as amended by section 16 of part FF-1 of chapter 57 of the laws of 2008,
is amended to read as follows:
(4)(i) For purposes of this paragraph, the term "closest controlling
stockholder" means the corporation that indirectly owns or controls over
fifty percent of the voting stock of a captive REIT or captive RIC, is
subject to tax under section fifteen hundred one of this article[,] OR
article nine-A [or article thirty-two] of this chapter or required to be
included in a combined return or report under this article[,] OR article
nine-A [or article thirty-two] of this chapter, and is the fewest tiers
of corporations away in the ownership structure from the captive REIT or
captive RIC. The commissioner is authorized to prescribe by regulation
or published guidance the criteria for determining the closest control-
ling stockholder.
(ii) A captive REIT or a captive RIC must be included in a combined
return with the corporation that directly owns or controls over fifty
percent of the voting stock of the captive REIT or captive RIC if that
corporation is a life insurance corporation and is subject to tax or
required to be included in a combined return under this article.
(iii) If over fifty percent of the voting stock of a captive REIT or
captive RIC is not directly owned or controlled by a life insurance
corporation that is subject to tax or required to be included in a
combined return under this article, [then the captive REIT or captive
RIC must be included in a combined report or return with the corporation
that is the closest controlling stockholder of the captive REIT or
captive RIC. If] AND the closest controlling stockholder of the captive
REIT or captive RIC is a life insurance corporation that is subject to
tax or required to be included in a combined return under this article,
then the captive REIT or captive RIC must be included in a combined
return WITH THE CLOSEST CONTROLLING STOCKHOLDER under this article.
(iv) If a captive REIT owns the stock of a qualified REIT subsidiary
(as defined in paragraph two of subsection (i) of section eight hundred
fifty-six of the internal revenue code) AND THE CAPTIVE REIT IS REQUIRED
TO BE INCLUDED IN A COMBINED RETURN UNDER SUBPARAGRAPHS (II) OR (III) OF
THIS PARAGRAPH, then the qualified REIT subsidiary must be included in
any combined return required to be made by the captive REIT that owns
the stock of the qualified REIT subsidiary.
(v) If a captive REIT or a captive RIC is required under this para-
graph to be included in a combined return with another corporation, and
that other corporation is required to be included in a combined return
with another [related] corporation under this subdivision, then the
captive REIT or the captive RIC must be included in that combined return
with the other [related] corporation.
S 24. Subdivisions (a), (b) and (c) of section 12 of the tax law, as
added by chapter 615 of the laws of 1998, are amended to read as
follows:
(a) For purposes of subdivision (b) of this section, the term "person"
shall mean a corporation, joint stock company or association, insurance
corporation, or banking corporation, as such terms are defined in
section one hundred eighty-three, one hundred eighty-four, or one
hundred eighty-six, or in article nine-A[, thirty-two] or thirty-three
of this chapter, imposing tax on such entities.
(b) No person shall be subject to the taxes imposed under section one
hundred eighty-three, one hundred eighty-four or one hundred eighty-six,
or article nine-A[, thirty-two] or thirty-three of this chapter, solely
by reason of (1) having its advertising stored on a server or other
S. 6359 115 A. 8559
computer equipment located in this state (other than a server or other
computer equipment owned or leased by such person), or (2) having its
advertising disseminated or displayed on the Internet by an individual
or entity subject to tax under section one hundred eighty-three, one
hundred eighty-four or one hundred eighty-six, or article nine-A, twen-
ty-two[, thirty-two] or thirty-three of this chapter.
(c) A person, as such term is defined in subdivision (a) of section
eleven hundred one of this chapter, shall not be deemed to be a vendor,
for purposes of article twenty-eight of this chapter, solely by reason
of (1) having its advertising stored on a server or other computer
equipment located in this state (other than a server or other computer
equipment owned or leased by such person), or (2) having its advertising
disseminated or displayed on the Internet by an individual or entity
subject to tax under section one hundred eighty-three, one hundred
eighty-four or one hundred eighty-six, or article nine-A, twenty-two[,
thirty-two] or thirty-three of this chapter.
S 25. Paragraph 1 of subdivision (a) of section 14 of the tax law, as
amended by section 3 of part V1 of chapter 109 of the laws of 2006, is
amended to read as follows:
(1) except as provided in paragraphs one-a and one-b of this subdivi-
sion, for purposes of section one hundred eighty-seven-j and articles
nine-A, twenty-two[, thirty-two] and thirty-three of this chapter, for
each of the taxable years within the "business tax benefit period,"
which period shall consist of (A) in the case of a business enterprise
with a test date occurring on or before December thirty-first, two thou-
sand one, the first fifteen taxable years beginning on or after January
first, two thousand one, (B) in the case of a business enterprise with a
test date occurring on or after January first, two thousand two, but
prior to April first, two thousand five, the fifteen taxable years next
following the business enterprise's test year, and (C) in the case of a
business enterprise which is first certified under article eighteen-B of
the general municipal law on or after April first, two thousand five,
the ten taxable years starting with the taxable year in which the busi-
ness enterprise's first date of certification under article eighteen-B
of the general municipal law occurs, but only with respect to each of
such business tax benefit period years for which the employment test is
met,
S 26. Subdivision (f) of section 14 of the tax law, as amended by
section 10 of part CC of chapter 85 of the laws of 2002, is amended to
read as follows:
(f) Taxable year. The term "taxable year" means the taxable year of
the business enterprise under section one hundred eighty-three, one
hundred eighty-four, one hundred eighty-five or former section one
hundred eighty-six of article nine, or under article nine-A, twenty-
two[, thirty-two] or thirty-three of this chapter. If a business enter-
prise does not have a taxable year because it is exempt from taxation or
otherwise not required to file a return under any of such sections of
article nine or under article nine-A, twenty-two[, thirty-two] or thir-
ty-three, then the term "taxable year" means (i) the business enter-
prise's federal taxable year, or, (ii) if the enterprise does not have a
federal taxable year, the calendar year.
S 27. Paragraph 1 of subdivision (i) of section 14 of the tax law, as
amended by section 5 of part A of chapter 63 of the laws of 2005, is
amended to read as follows:
(1) for purposes of section one hundred eighty-seven-j of article
nine, and articles nine-A, twenty-two[, thirty-two] and thirty-three of
S. 6359 116 A. 8559
this chapter, on the first day of the taxable year during which revoca-
tion of its certification under article eighteen-B of the general munic-
ipal law occurs, and
S 28. Paragraphs 1 and 2 of subdivision (j) of section 14 of the tax
law, as amended by section 10 of part CC of chapter 85 of the laws of
2002, are amended to read as follows:
(1) A new business shall include any corporation, except a corporation
which is substantially similar in operation and in ownership to a busi-
ness entity (or entities) taxable, or previously taxable, under section
one hundred eighty-three, one hundred eighty-four, one hundred eighty-
five or one hundred eighty-six of article nine; article nine-A[, 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), ARTICLE THIRTY-TWO OF THIS CHAPTER OR WHICH WOULD HAVE
BEEN SUBJECT TO TAX UNDER SUCH ARTICLE THIRTY-TWO (AS SUCH ARTICLE WAS
IN EFFECT ON DECEMBER THIRTY-FIRST, TWO THOUSAND FOURTEEN) or the income
(or losses) of which is (or was) includable under article twenty-two of
this chapter.
(2) For purposes of article twenty-two of this chapter, an individual
who is either a sole proprietor or a member of a partnership shall qual-
ify as an owner of a new business unless the business of which the indi-
vidual is an owner is substantially similar in operation and in owner-
ship to a business entity taxable, or previously taxable, under section
one hundred eighty-three, one hundred eighty-four, one hundred eighty-
five or one hundred eighty-six of article nine; article nine-A[, thir-
ty-two] or ARTICLE 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); ARTICLE THIRTY-TWO OF THIS CHAPTER OR WHICH WOULD HAVE
BEEN SUBJECT TO TAX UNDER SUCH ARTICLE THIRTY-TWO AS SUCH ARTICLE WAS IN
EFFECT ON DECEMBER THIRTY-FIRST, TWO THOUSAND TEN or the income (or
losses) of which is (or was) includable under article twenty-two.
S 29. Clauses (i) and (ii) of subparagraph (A) of paragraph 4 of
subdivision (j) of section 14 of the tax law, as added by section 5 of
part A of chapter 63 of the laws of 2005, are amended to read as
follows:
(i) Notwithstanding paragraphs one and two of this subdivision, a new
business shall include any corporation which is identical in operation
and ownership to a business entity (or entities) taxable under section
one hundred eighty-three, one hundred eighty-four or one hundred eight-
y-five of article nine; article nine-A[, article thirty-two] or thirty-
three of this chapter or the income (or losses) of which is includable
under article twenty-two of this chapter, provided such corporation and
such business entity or entities are operating in different counties in
the state.
(ii) Notwithstanding paragraphs one and two of this subdivision, an
individual who is either a sole proprietor or a member of a partnership
shall qualify as an owner of a new business if the business of which the
individual is an owner is identical in operation and in ownership to a
business entity (or entities) taxable under section one hundred eighty-
three, one hundred eighty-four or one hundred eighty-five of article
nine; article nine-A[, article thirty-two] or thirty-three of this chap-
ter or the income (or losses) of which is includable under article twen-
ty-two of this chapter, provided such business and such business entity
or entities are operating in different counties in the state.
S. 6359 117 A. 8559
S 30. Subparagraph (B) of paragraph 4 of subdivision (j) of section 14
of the tax law, as amended by chapter 161 of the laws of 2005, is
amended to read as follows:
(B) Notwithstanding any provisions of this subdivision to the contrary
and notwithstanding subdivision c of section eighteen of part CC of
chapter eighty-five of the laws of two thousand two, a corporation or
partnership, which was first certified under article eighteen-B of the
general municipal law before August first, two thousand two, has a base
period of zero years or zero employment for its base period, and is
similar in operation and in ownership to a business entity or entities
taxable, or previously taxable, under sections specified in paragraph
one or two of this subdivision or which would have been subject to tax
under article twenty-three of this chapter (as such article was in
effect on January first, nineteen hundred eighty) OR WHICH WOULD HAVE
BEEN SUBJECT TO TAX UNDER ARTICLE THIRTY-TWO OF THIS CHAPTER (AS SUCH
ARTICLE WAS IN EFFECT ON DECEMBER THIRTY-FIRST, TWO THOUSAND FOURTEEN)
or the income or losses of which is or was includable under article
twenty-two of this chapter shall not be deemed a new business if it was
not formed for a valid business purpose, as such term is defined in
clause (D) of subparagraph one of paragraph (o) of subdivision nine of
section two hundred eight of this chapter and was formed solely to gain
empire zone benefits.
S 31. Subdivision (k) of section 14 of the tax law, as amended by
section 5 of part A of chapter 63 of the laws of 2005, is amended to
read as follows:
(k) If the designation of an area as an empire zone is no longer in
effect because section nine hundred sixty-nine of the general municipal
law was not amended to extend the effective date of such designation so
that the designations of all empire zones pursuant to article eighteen-B
of the general municipal law have expired, a business enterprise that
was certified pursuant to article eighteen-B of the general municipal
law on the day immediately preceding the day on which such designation
expired shall be deemed to continue to be certified under such article
eighteen-B for purposes of this section, and sections fifteen, sixteen,
section one hundred eighty-seven-j, subdivisions [twenty-seven] FIVE and
[twenty-eight] SIX of section two hundred [ten] TEN-B, subsections (bb)
and (cc) of section six hundred six, subdivision (z) of section eleven
hundred fifteen[, subsections (o) and (p) of section fourteen hundred
fifty-six,] and subdivisions (r) and (s) of section fifteen hundred
eleven of this chapter. In addition, if the designation of an area as an
empire zone is no longer in effect because section nine hundred sixty-
nine of the general municipal law was not amended to extend the effec-
tive date of such designation so that the designations of all empire
zones pursuant to article eighteen-B of the general municipal law have
expired, all references to empire zones in the provisions of this chap-
ter listed in the previous sentence shall be read as meaning areas
designated as empire zones on the day immediately preceding the day on
which such designation expired.
S 32. Subdivisions (a) and (h) of section 15 of the tax law, as
amended by section 5 of part A of chapter 63 of the laws of 2005, are
amended to read as follows:
(a) Allowance of credit. A taxpayer which is a qualified empire zone
enterprise (QEZE), or which is a sole proprietor of a QEZE or a member
of a partnership which is a QEZE, and which is subject to tax under
article nine-A, twenty-two[, thirty-two] or thirty-three of this chap-
ter, shall be allowed a credit against such tax, pursuant to the
S. 6359 118 A. 8559
provisions referenced in subdivision (h) of this section, for eligible
real property taxes.
(h) Definitions and cross-references. For definitions of terms used in
this section see section fourteen of this article. For application of
the credit provided for in this section, see the following provisions of
this chapter:
(1) Article 9: Section 187-j.
(2) Article 9-A: Section [210] 210-B: subdivision [27] 5.
(3) Article 22: Section 606: subsections (i) and (bb).
(4) [Article 32: Section 1456: subsection (o).
(5)] Article 33: Section 1511: subdivision (r).
S 33. Subdivision (a) of section 16 of the tax law, as added by
section 2 of part GG of chapter 63 of the laws of 2000, is amended to
read as follows:
(a) Allowance of credit. A taxpayer which is a qualified empire zone
enterprise (QEZE), or which is a sole proprietor of a QEZE or a member
of a partnership which is a QEZE, and which is subject to tax under
article nine-A, twenty-two[, thirty-two] or thirty-three of this chap-
ter, shall be allowed a credit against such tax, pursuant to the
provisions referenced in subdivision (g) of this section, to be computed
as hereinafter provided.
S 34. Paragraph 1, clause (ii) of subparagraph (B) of paragraph 2, and
subparagraph (A) of paragraph 3 of subdivision (f) of section 16 of the
tax law, as amended by section 14 of part CC of chapter 85 of the laws
of 2002, are amended to read as follows:
(1) General. The tax factor shall be, in the case of article nine-A of
this chapter, the [larger of the amounts] AMOUNT of tax determined for
the taxable year under [paragraphs] PARAGRAPH (a) [and (c)] of subdivi-
sion one of section two hundred ten of such article. The tax factor
shall be, in the case of article twenty-two of this chapter, the tax
determined for the taxable year under subsections (a) through (d) of
section six hundred one of such article. [The tax factor shall be, in
the case of article thirty-two of this chapter, the larger of the
amounts of tax determined for the taxable year under subsection (a) and
paragraph two of subsection (b) of section fourteen hundred fifty-five
of such article.] The tax factor shall be, in the case of article thir-
ty-three of this chapter, the larger of the amounts of tax determined
for the taxable year under paragraphs one and three of subdivision (a)
of section fifteen hundred two of such article.
(ii) For purposes of article nine-A[, thirty-two or thirty-three] of
this chapter, the term "partner's income from the partnership" means
partnership items of income, gain, loss and deduction, and New York
modifications thereto, entering into [entire net] BUSINESS income[,
minimum taxable income, alternative entire net income or entire net
income plus compensation] and the term "partner's entire income" means
[entire net] BUSINESS income[, minimum taxable income, alternative
entire net income or entire net income plus compensation,] allocated
within the state. FOR PURPOSES OF ARTICLE THIRTY-THREE OF THIS CHAPTER,
THE TERM "PARTNER'S INCOME FROM THE PARTNERSHIP" MEANS PARTNERSHIP ITEMS
OF INCOME, GAIN, LOSS AND DEDUCTION, AND NEW YORK MODIFICATIONS THERETO,
ENTERING INTO ENTIRE NET INCOME OR ENTIRE NET INCOME PLUS COMPENSATION
AND THE TERM "PARTNER'S ENTIRE INCOME" MEANS ENTIRE NET INCOME, OR
ENTIRE NET INCOME PLUS COMPENSATION, ALLOCATED WITHIN THE STATE. For
purposes of article twenty-two of this chapter, the term "partner's
income from the partnership" means partnership items of income, gain,
loss and deduction, and New York modifications thereto, entering into
S. 6359 119 A. 8559
New York adjusted gross income, and the term "partner's entire income"
means New York adjusted gross income.
(A) Where the taxpayer is a qualified empire zone enterprise and is
required or permitted to make a return or report on a combined basis
under article nine-A[, thirty-two] or ARTICLE thirty-three of this chap-
ter, the taxpayer's tax factor shall be the amount determined in para-
graph one of this subdivision which is attributable to the income of the
qualified empire zone enterprise. Such attribution shall be made in
accordance with the ratio of the qualified empire zone enterprise's
income allocated within the state to the combined group's income, or in
accordance with such other methods as the commissioner may prescribe as
providing an apportionment which reasonably reflects the portion of the
combined group's tax attributable to the income of the qualified empire
zone enterprise. In no event may the ratio so determined exceed 1.0.
S 35. Subdivision (g) of section 16 of the tax law, as added by
section 2 of part GG of chapter 63 of the laws of 2000, is amended to
read as follows:
(g) Definitions and cross-references. For definitions of terms used in
this section see sections fourteen and fifteen of this article. For
application of the credit provided for in this section, see the follow-
ing provisions of this chapter:
(1) Article 9-A: Section [210] 210-B: subdivision [28]6.
(2) Article 22: Section 606: subsections (i) and (cc).
(3) [Article 32: Section 1456: subsection (p).
(4)] Article 33: Section 1511: subdivision (s).
S 36. Paragraph 1 of subdivision (b) of section 17 of the tax law, as
added by section 43 of part S1 of chapter 57 of the laws of 2009, is
amended to read as follows:
(1) The empire zones tax benefits report must contain the following
information about the empire zone tax credits claimed under articles
nine, nine-A, twenty-two[, thirty-two] and thirty-three of this chapter
during the previous calendar year:
(A) the name of each taxpayer claiming a credit; and
(B) the amount of each credit earned by each taxpayer.
S 37. Subdivisions (a) and (d) of section 18 of the tax law, as added
by section 2 of part CC of chapter 63 of the laws of 2000, are amended
to read as follows:
(a) Allowance of credit. A taxpayer subject to tax under article
nine-A, twenty-two[, thirty-two] or thirty-three of this chapter shall
be allowed a credit against such tax, pursuant to the provisions refer-
enced in subdivision (d) of this section, with respect to the ownership
of eligible low-income buildings for which an eligibility statement has
been issued by the commissioner of housing and community renewal. The
amount of the credit shall be the credit amount for each such building
allocated by such commissioner as provided in article two-A of the
public housing law. The credit amount shall be allowed for each of the
ten taxable years in the credit period, and any reduction in first-year
credit as provided in subdivision two of section twenty-two of such law
shall be allowed in the eleventh taxable year.
(d) Cross-references. For application of the credit provided for in
this section, see the following provisions of this chapter:
(1) Article 9-A: Section [210] 210-B: subdivision [30] 15,
(2) Article 22: Section 606: subsections (i) and (x),
(3) [Article 32: Section 1456: subsection (l),
(4)] Article 33: Section 1511: subdivision (n).
S. 6359 120 A. 8559
S 38. Subparagraph (A) of paragraph 1 of subdivision (a) and subdivi-
sion (f) of section 19 of the tax law, as added by section 2 of part II
of chapter 63 of the laws of 2000, are amended to read as follows:
(A) Green building credit. A taxpayer subject to tax under article
nine, nine-A, twenty-two[, thirty-two] or thirty-three of this chapter
shall be allowed a green building credit against such tax, pursuant to
the provisions referenced in subdivision (f) of this section. Provided,
however, no credit shall be allowed under this section unless the
taxpayer has complied with the applicable requirements of paragraph two
of subdivision (d) of this section (relating to reports to DEC). The
amount of the credit shall be the sum of the credit components specified
in paragraphs two through seven of this subdivision. Provided, however,
the amount of each such credit component shall not exceed the limit set
forth in the initial credit component certificate obtained pursuant to
subdivision (c) of this section. In the determination of such credit
components, no cost paid or incurred by the taxpayer shall be the basis
for more than one such component.
(f) Cross-references. For application of the credit provided for in
this section, see the following provisions of this chapter:
(1) Article nine: Section one hundred eighty-seven-d;
(2) Article nine-A: Subdivision [thirty-one] SIXTEEN of section two
hundred [ten] TEN-B;
(3) Article twenty-two: Subsections (i) and (y) of section six hundred
six;
(4) [Article thirty-two: Subsection (m) of section fourteen hundred
fifty-six;
(5)] Article thirty-three: Subdivision (o) of section fifteen hundred
eleven.
S 39. Paragraphs 1 and 5 of subdivision (a) of section 21 of the tax
law, as amended by section 1 of part H of chapter 577 of the laws of
2004, are amended to read as follows:
(1) General. A taxpayer subject to tax under article nine, nine-A,
twenty-two[, thirty-two] or thirty-three of this chapter shall be
allowed a credit against such tax, pursuant to the provisions referenced
in subdivision (f) of this section. Such credit shall be allowed with
respect to a qualified site, as such term is defined in paragraph one of
subdivision (b) of this section. The amount of the credit in a taxable
year shall be the sum of the credit components specified in paragraphs
two, three and four of this subdivision applicable in such year.
(5) Applicable percentage. For purposes of paragraphs two, three and
four of this subdivision, the applicable percentage shall be twelve
percent in the case of credits claimed under article nine, nine-A[,
thirty-two] or thirty-three of this chapter, and ten percent in the case
of credits claimed under article twenty-two of this chapter, except that
where at least fifty percent of the area of the qualified site relating
to the credit provided for in this section is located in an environ-
mental zone as defined in paragraph six of subdivision (b) of this
section, the applicable percentage shall be increased by an additional
eight percent. Provided, however, as afforded in section 27-1419 of the
environmental conservation law, if the certificate of completion indi-
cates that the qualified site has been remediated to Track 1 as that
term is described in subdivision four of section 27-1415 of the environ-
mental conservation law, the applicable percentage set forth in the
first sentence of this paragraph shall be increased by an additional two
percent.
S. 6359 121 A. 8559
S 39-a. Subdivisions (c) and (f) of section 21 of the tax law, as
added by section 1 of part H of chapter 1 of the laws of 2003, are
amended to read as follows:
(c) Qualifying property. Property which qualifies for the credit
provided for under this section and also for a credit provided for (1)
under either subdivision [twelve] ONE or subdivision [twelve-B] THREE of
section two hundred [ten] TEN-B of this chapter, or both, OR (2)
subsection (a) or subsection (j) of section six hundred six of this
chapter, or both[, (3) the credit provided for under subsection (i) of
section fourteen hundred fifty-six of this chapter, or (4) the credit
provided under subdivision (q) of section fifteen hundred eleven of this
chapter] may be the basis for either the credit provided for under this
section or one of the credits enumerated in paragraph one[,] OR two[,
three or four] of this subdivision, but not both.
(f) Cross-references. For application of the credit provided for in
this section, see the following provisions of this chapter:
(1) Article 9: Section 187-g
(2) Article 9-A: Section [210] 210-B, subdivision [33] 17
(3) Article 22: Section 606, subsections (i) and (dd)
(4) [Article 32: Section 1456, subsection (q)
(5)] Article 33: Section 1511, subdivision (u).
S 40. Paragraph 3 of subdivision (a) and paragraphs 1 and 9 of subdi-
vision (b) of section 22 of the tax law, as amended by section 4 of part
H of chapter 577 of the laws of 2004, are amended to read as follows:
(3) Developer. (i) A "developer" is a taxpayer under article nine,
nine-A, twenty-two[, thirty-two] or thirty-three of this chapter who or
which either (I) has been issued a certificate of completion with
respect to a qualified site or (II) has purchased or in any other way
has been conveyed all or any portion of a qualified site from a taxpayer
or any other party who or which has been issued a certificate of
completion with respect to such site provided, such purchase or convey-
ance occurs within seven years of the effective date of the certificate
of completion issued with respect to such qualified site. Provided
further, that the taxpayer who or which is purchasing all or any portion
of a qualified site and the taxpayer or any other party who or which has
been issued a certificate of completion with respect to such site may
not be related persons, 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.
(ii) Where the entity to whom a certificate of completion has been
issued is a partnership, or where the entity which has purchased all or
any portion of a qualified site from a taxpayer who or which has been
issued a certificate of completion with respect to such site within the
applicable time limit is a partnership, any partner in such partnership
who or which is taxable under article nine, nine-A, twenty-two[, thir-
ty-two] or thirty-three of this chapter shall be a developer under this
paragraph. Where the entity to whom a certificate of completion has been
issued is a New York S corporation, or where the entity which has
purchased all or any portion of a qualified site from a taxpayer who or
which has been issued a certificate of completion with respect to such
site within the applicable time limit is a New York S corporation, any
shareholder in such New York S corporation shall be a developer under
this paragraph.
(1) Allowance of credit. A developer of a qualified site who or which
is subject to tax under article nine, nine-A, twenty-two[, thirty-two]
or thirty-three of this chapter, shall be allowed a credit against such
S. 6359 122 A. 8559
tax, pursuant to the provisions referenced in paragraph nine of this
subdivision, for eligible real property taxes imposed on such site.
(9) Cross-references. For application of the credit provided for in
this subdivision, see the following provisions of this chapter:
(i) Article 9: Section 187-h.
(ii) Article 9-A: Section [210] 210-B: subdivision [34] 18.
(iii) Article 22: Section 606: subsections (i) and (ee).
(iv) [Article 32: Section 1456: subsection (r).
(v)] Article 33: Section 1511: subdivision (v).
S 41. Subdivision (a) of section 23 of the tax law, as amended by
section 10 of part H chapter 577 of the laws of 2004, is amended to read
as follows:
(a) Allowance of credit. General. A taxpayer subject to tax under
article nine, nine-A, twenty-two[, thirty-two] or thirty-three of this
chapter shall be allowed a credit against such tax, pursuant to the
provisions referenced in subdivision (e) of this section. The amount of
such credit shall be equal to the lesser of thirty thousand dollars or
fifty percent of the premiums paid on or after the date of the brown-
field site cleanup agreement executed by the taxpayer and the department
of environmental conservation pursuant to section 27-1409 of the envi-
ronmental conservation law by the taxpayer for environmental remediation
insurance issued with respect to a qualified site.
S 42. Subdivision (e) of section 23 of the tax law, as added by
section 19 of part H of chapter 1 of the laws of 2003, is amended to
read as follows:
(e) Cross-references. For application of the credit provided for in
this section, see the following provisions of this chapter:
(1) Article 9: Section 187-i
(2) Article 9-A: Section [210] 210-B, subdivision [35] 19
(3) Article 22: Section 606, subsections (i) and (ff)
(4) [Article 32: Section 1456, subsection (s)
(5)] Article 33: Section 1511, subdivision (w).
S 43. Paragraphs 1 and 2 of subdivision (a) and clause (i) of subpara-
graph (D) of paragraph 1 of subdivision (b) of section 25 of the tax
law, as added by section 1 of part N of chapter 61 of the laws of 2005,
are amended to read as follows:
(1) Every taxpayer, or person as defined in section seven thousand
seven hundred one of the internal revenue code, required to file a
disclosure statement with the internal revenue service pursuant to
section six thousand eleven of the internal revenue code, or the regu-
lations promulgated thereunder, related to a reportable transaction or a
listed transaction, as those terms are defined in such section or regu-
lations, must attach a duplicate of such disclosure statement to the
return or report required to be filed by such taxpayer or person for the
taxable year under article nine, nine-A, twenty-two[, thirty-two] or
thirty-three of this chapter, and provide such other information related
to such disclosure as prescribed by the commissioner. Such disclosure
shall be made notwithstanding that one member of an affiliated group, as
defined by section fifteen hundred four of the internal revenue code,
may file such disclosure statement with the internal revenue service on
behalf of its affiliates including such taxpayer or person.
(2) Every taxpayer or such person who participates in a New York
reportable transaction for a taxable year must disclose such partic-
ipation with its return or report required to be filed under article
nine, nine-A, twenty-two[, thirty-two] or thirty-three of this chapter
for the taxable year in a form prescribed by the commissioner, and
S. 6359 123 A. 8559
provide such other information related to such transaction as prescribed
by the commissioner. A New York reportable transaction is a transaction
that has the potential to be a tax avoidance transaction as determined
by the commissioner.
(i) the list required to be maintained by such person pursuant to
section six thousand one hundred twelve of the internal revenue code
identifies or is required to identify a taxpayer subject to tax under
article nine, nine-A, twenty-two[, thirty-two] or thirty-three of this
chapter, and
S 44. Subdivisions (a) and (f) of section 26 of the tax law, as added
by chapter 537 of the laws of 2005, are amended to read as follows:
(a) Allowance of credit. A taxpayer, which is subject to tax under
article nine, nine-A, twenty-two[, thirty-two] or thirty-three of this
chapter and which is a qualified building owner, shall be allowed a
credit against such tax. The amount of the credit allowed under this
section shall equal the sum of the number of qualified security officers
providing protection to a building or buildings owned by the taxpayer
multiplied by three thousand dollars. Provided, however, that in the
case of a worker not so employed for a full year, such amount shall be
prorated to reflect the length of such employment under regulations of
the commissioner.
(f) Cross-references. For application of the credit provided for in
this section, see the following provisions of this chapter:
(1) article 9: section 187-n.
(2) article 9-A: section [210] 210-B: subdivision [37] 21.
(3) article 22: section 606: subsection (ii).
(4) [article 32: section 1456: subsection (t).
(5)] article 33: section 1511: subdivision (x).
S 45. Paragraph 3 of subdivision (a) and subdivision (c) of section 28
of the tax law, as added by section 2 of part V of chapter 62 of the
laws of 2006, are amended to read as follows:
(3) No qualified production costs used by a taxpayer either as the
basis for the allowance of the credit provided for under this section or
used in the calculation of the credit provided for under this section
shall be used by such taxpayer to claim any other credit allowed pursu-
ant to this chapter.
Notwithstanding any provisions of this section to the contrary, a
corporation or partnership, which otherwise qualifies as a qualified
commercial production company, and is similar in operation and in owner-
ship to a business entity or entities taxable, or previously taxable,
under section one hundred eighty-three, one hundred eighty-four or one
hundred eighty-five of article nine; article nine-A[, article thirty-
two] or thirty-three of this chapter or which would have been subject to
tax under article twenty-three of this chapter (as such article was in
effect on January first, nineteen hundred eighty) OR WHICH WOULD HAVE
BEEN SUBJECT TO TAX UNDER ARTICLE THIRTY-TWO OF THIS CHAPTER (AS SUCH
ARTICLE WAS IN EFFECT ON DECEMBER THIRTY-FIRST, TWO THOUSAND FOURTEEN)
or the income or losses of which is or was includable under article
twenty-two of this chapter shall not be deemed a new or separate busi-
ness, and therefore shall not be eligible for empire state commercial
production benefits, if it was not formed for a valid business purpose,
as such term is defined in clause (D) of subparagraph one of paragraph
(o) of subdivision nine of section two hundred eight of this chapter and
was formed solely to gain empire state commercial production credit
benefits.
S. 6359 124 A. 8559
(c) Cross-references. For application of the credit provided for in
this section, see the following provision of this chapter:
(1) article 9-A: section [210] 210-B: subdivision [38] 23.
(2) article 22: section 606: subsection (jj).
S 46. Subdivision (d) of section 28 of the tax law, as added by
section 1 of part X of chapter 62 of the laws of 2006, is amended to
read as follows:
(d) Cross-references. For application of the credit provided for in
this section, see the following provisions of this chapter:
(1) Article 9: Section 187-c.
(2) Article 9-A: Section [210] 210-B, subdivision [38] 24.
(3) Article 22: Section 606, subsections (i) and (jj).
S 47. The opening paragraph of subdivision (a) and subdivisions (c)
and (g) of section 31 of the tax law, the opening paragraph of subdivi-
sion (a) and subdivision (g) as amended by section 7 of part G of chap-
ter 61 of the laws of 2011, subdivision (c) as added by section 2 of
part MM of chapter 59 of the laws of 2010, are amended to read as
follows:
General. A taxpayer subject to tax under section one hundred eighty-
five, article nine-A, twenty-two[, thirty-two] or thirty-three of this
chapter shall be allowed a credit against such tax, pursuant to the
provisions referenced in subdivision (g) of this section. The amount of
the credit, allowable for up to ten consecutive taxable years, is the
sum of the following four credit components:
(c) Election of credit. A taxpayer who or which is qualified to claim
the excelsior investment tax credit component and is also qualified to
claim the investment tax credit provided for under subdivision [twelve]
ONE of section two hundred [ten,] TEN-B OR subsection (a) of section six
hundred six[, or subsection (i) of section fourteen hundred fifty-six]
of this chapter, may claim either the excelsior investment tax credit
component or the investment tax credit, but not both with regard to a
particular piece of property. In addition, a taxpayer who or which is
qualified to claim the excelsior investment tax credit component and is
also qualified to claim the brownfield tangible property credit compo-
nent under section twenty-one of this article, as added by chapter one
of the laws of two thousand three, may claim either the excelsior
investment tax credit component or such tangible property credit compo-
nent, but not both with regard to a particular piece of property. The
election to claim the excelsior investment tax credit component, the
investment tax credit or the brownfield tangible property credit compo-
nent, with regard to the same property, is irrevocable.
(g) Cross-references. For application of the credit provided for in
this section, see the following provisions of this chapter:
(1) article 9: section 187-q.
(2) article 9-A: section [210] 210-B: subdivision [41] 31.
(3) article 22: section 606: subsection (qq).
(4) [article 32: section 1456: subsection (u).
(5)] article 33: section 1511: subdivision (y).
S 48. Subdivision (d) of section 31 of the tax law, as added by
section 12 of part Q of chapter 57 of the laws of 2010, is amended to
read as follows:
(d) Cross-references. For application of the credit provided for in
this section, see the following provisions of this chapter:
(1) article 9-A: section [210] 210-B: subdivision [41] 32.
(2) article 22: section 606: subsection (qq).
S. 6359 125 A. 8559
S 49. Subdivision 3 of section 34 of the tax law, as added by section
2 of part Y of chapter 57 of the laws of 2010, is amended to read as
follows:
3. (a) For application of the temporary deferral nonrefundable payout
credit, see the following provisions of this chapter:
(1) Article 9: section 187-0
(2) Article 9-A: section [210(41)] 210-B(33)
(3) Article 22: section 606(qq)
(4) [Article 32: section 1456(v)
(5)] Article 33: section 1511(y)
(b) For application of the temporary deferral refundable payout cred-
it, see the following provisions of this chapter:
(1) Article 9: section 187-p
(2) Article 9-A: section [210(42)] 210-B(34)
(3) Article 22: section 606(rr)
(4) [Article 32: section 1456(w)
(5)] Article 33: section 1511(z)
S 50. The opening paragraph of subdivision (a), subparagraph (C) of
paragraph 2 of subdivision (e), and subdivision (f) of section 35 of the
tax law, as added by section 3 of part V of chapter 61 of the laws of
2011, are amended to read as follows:
A taxpayer which is a participant or the owner of a participant in the
economic transformation and facility redevelopment program under article
eighteen of the economic development law that is subject to tax under
section one hundred eighty-five of article nine, or article nine-A,
twenty-two[, thirty-two] or thirty-three of this chapter shall be
allowed the sum of following components against such tax, pursuant to
the provisions referenced in subdivision (f) of this section.
(C) the business entity must not be substantially similar in ownership
and operation to another taxpayer taxable or previously taxable under
section one hundred eighty-three, one hundred eighty-four or one hundred
eighty-five of article nine, former section one hundred eighty-six of
this chapter or article nine-A, twenty-two[, thirty-two] or thirty-three
of this chapter OR FORMER ARTICLE THIRTY-TWO OF THIS CHAPTER or the
income or losses of which is or was includable under article twenty-two
of this chapter;
(f) Cross-references. For application of the credits provided for in
this section, see the following provisions of this chapter:
(1) section 185: section 187-r.
(2) article 9-A: section [210(43)] 210-B(35).
(3) article 22: section 606 (ss).
(4) [article 32: section 1456(x).
(5)] article 33: section 1511 (aa).
S 51. Subdivisions (a) and (e) of section 36 of the tax law, as added
by section 2 of part E of chapter 56 of the laws of 2011, are amended to
read as follows:
(a) Allowance of credit. A taxpayer subject to tax under article
nine-A, twenty-two[, thirty-two] or thirty-three of this chapter shall
be allowed a credit against such tax, pursuant to the provisions refer-
enced in subdivision (e) of this section. The amount of the credit,
allowable for ten consecutive tax years, is equal to the amount deter-
mined pursuant to section four hundred twenty-five of the economic
development law.
(e) Cross-references. For application of the credit provided for in
this section, see the following provisions of this chapter:
(1) article 9-A: section [210] 210-B, subdivision [44] 37;
S. 6359 126 A. 8559
(2) article 22: section 606, subsection (tt);
(3) [article 32: section 1456, subsection (y);
(4)] article 33, section 1511, subdivision (bb).
S 52. Subdivision (c) of section 37 of the tax law, as added by chap-
ter 109 of the laws of 2012, is amended to read as follows:
(c) Cross-references. For application of the credit provided for in
this section, see the following provisions of this chapter:
(1) Article 9-A: Section [210] 210-B, subdivision [45] 39.
(2) Article 22: Section 606, subsections (i) and (uu).
S 52-a. Subdivision (c) of section 39 of the tax law is REPEALED.
S 53. Paragraphs 2, 3 and 4 of subdivision (k) of section 39 of the
tax law, paragraphs 2 and 3 as added by section 2 of part A of chapter
68 of the laws of 2013, paragraph 4 as amended by section 2 of LBD
number 74039-02-4, are amended to read as follows:
[(2) Article 9: section 180, subdivision 3.
(3) Article 9: section 181, subdivision 3.]
(4) Article 9-A: section [210] 210-B, subdivision [47] 41 and subdivi-
sion [48] 44.
S 54. Subdivision 1 of section 171-a of the tax law, as amended by
section 1 of part R of chapter 60 of the laws of 2004, is amended to
read as follows:
1. All taxes, interest, penalties and fees collected or received by
the commissioner or the commissioner's duly authorized agent under arti-
cles nine (except section one hundred eighty-two-a thereof and except as
otherwise provided in section two hundred five thereof), nine-A,
twelve-A (except as otherwise provided in section two hundred eighty-
four-d thereof), thirteen, thirteen-A (except as otherwise provided in
section three hundred twelve thereof), eighteen, nineteen, twenty
(except as otherwise provided in section four hundred eighty-two there-
of), twenty-one, twenty-two, twenty-six, twenty-six-B, twenty-eight
(except as otherwise provided in section eleven hundred two or eleven
hundred three thereof), twenty-eight-A, thirty-one (except as otherwise
provided in section fourteen hundred twenty-one thereof), [thirty-two,]
thirty-three and thirty-three-A of this chapter shall be deposited daily
in one account with such responsible banks, banking houses or trust
companies as may be designated by the comptroller, to the credit of the
comptroller. Such an account may be established in one or more of such
depositories. Such deposits shall be kept separate and apart from all
other money in the possession of the comptroller. The comptroller shall
require adequate security from all such depositories. Of the total
revenue collected or received under such articles of this chapter, the
comptroller shall retain in the comptroller's hands such amount as the
commissioner may determine to be necessary for refunds or reimbursements
under such articles of this chapter [and article ten thereof] out of
which amount the comptroller shall pay any refunds or reimbursements to
which taxpayers shall be entitled under the provisions of such articles
of this chapter [and article ten thereof]. The commissioner and the
comptroller shall maintain a system of accounts showing the amount of
revenue collected or received from each of the taxes imposed by such
articles. The comptroller, after reserving the amount to pay such
refunds or reimbursements, shall, on or before the tenth day of each
month, pay into the state treasury to the credit of the general fund all
revenue deposited under this section during the preceding calendar month
and remaining to the comptroller's credit on the last day of such
preceding month, (i) except that the comptroller shall pay to the state
department of social services that amount of overpayments of tax imposed
S. 6359 127 A. 8559
by article twenty-two of this chapter and the interest on such amount
which is certified to the comptroller by the commissioner as the amount
to be credited against past-due support pursuant to subdivision six of
section one hundred seventy-one-c of this [chapter] ARTICLE, (ii) and
except that the comptroller shall pay to the New York state higher
education services corporation and the state university of New York or
the city university of New York respectively that amount of overpayments
of tax imposed by article twenty-two of this chapter and the interest on
such amount which is certified to the comptroller by the commissioner as
the amount to be credited against the amount of defaults in repayment of
guaranteed student loans and state university loans or city university
loans pursuant to subdivision five of section one hundred seventy-one-d
and subdivision six of section one hundred seventy-one-e of this [chap-
ter] ARTICLE, (iii) and except further that, notwithstanding any law,
the comptroller shall credit to the revenue arrearage account, pursuant
to section ninety-one-a of the state finance law, that amount of over-
payment of tax imposed by article nine, nine-A, twenty-two, thirty,
thirty-A, thirty-B[, thirty-two] or thirty-three of this chapter, and
any interest thereon, which is certified to the comptroller by the
commissioner as the amount to be credited against a past-due legally
enforceable debt owed to a state agency pursuant to paragraph (a) of
subdivision six of section one hundred seventy-one-f of this article,
provided, however, he shall credit to the special offset fiduciary
account, pursuant to section ninety-one-c of the state finance law, any
such amount creditable as a liability as set forth in paragraph (b) of
subdivision six of section one hundred seventy-one-f of this article,
(iv) and except further that the comptroller shall pay to the city of
New York that amount of overpayment of tax imposed by article nine,
nine-A, twenty-two, thirty, thirty-A, thirty-B[, thirty-two,] or thir-
ty-three of this chapter and any interest thereon that is certified to
the comptroller by the commissioner as the amount to be credited against
city of New York tax warrant judgment debt pursuant to section one
hundred seventy-one-l of this article, (v) and except further that the
comptroller shall pay to a non-obligated spouse that amount of overpay-
ment of tax imposed by article twenty-two of this chapter and the inter-
est on such amount which has been credited pursuant to section one
hundred seventy-one-c, one hundred seventy-one-d, one hundred seventy-
one-e, one hundred seventy-one-f or one hundred seventy-one-l of this
article and which is certified to the comptroller by the commissioner as
the amount due such non-obligated spouse pursuant to paragraph six of
subsection (b) of section six hundred fifty-one of this chapter; and
(vi) the comptroller shall deduct a like amount which the comptroller
shall pay into the treasury to the credit of the general fund from
amounts subsequently payable to the department of social services, the
state university of New York, the city university of New York, or the
higher education services corporation, or the revenue arrearage account
or special offset fiduciary account pursuant to section ninety-one-a or
ninety-one-c of the state finance law, as the case may be, whichever had
been credited the amount originally withheld from such overpayment, and
(vii) with respect to amounts originally withheld from such overpayment
pursuant to section one hundred seventy-one-l of this article and paid
to the city of New York, the comptroller shall collect a like amount
from the city of New York.
S 55. Subdivision 2 of section 171-a of the tax law, as amended by
chapter 57 of the laws of 1993, is amended to read as follows:
S. 6359 128 A. 8559
2. Notwithstanding subdivision one of this section or any other
provision of law to the contrary, the taxes imposed pursuant to sections
one hundred eighty-three-a, one hundred eighty-four-a, [one hundred
eighty-six-b,] one hundred eighty-six-c, [one hundred eighty-nine-a,]
two hundred nine-B[, fourteen hundred fifty-five-b] and fifteen hundred
five-a of this chapter, reduced by an amount for administrative costs,
shall be deposited to the credit of the metropolitan mass transportation
operating assistance account in the mass transportation operating
assistance fund, created pursuant to section eighty-eight-a of the state
finance law, as such taxes are received. The amount for administrative
costs shall be determined by the commissioner to represent reasonable
costs of the department of taxation and finance in administering,
collecting, determining and distributing such taxes. Of the total reven-
ue collected or received under such sections of this chapter, the comp-
troller shall retain in his hands such amount as the commissioner may
determine to be necessary for refunds or reimbursements under such
sections of this chapter out of which amount the comptroller shall pay
any refunds or reimbursements to which taxpayers shall be entitled under
provisions of such sections. The tax commissioner and the comptroller
shall maintain a system of accounts showing the amount of revenue
collected or received from each of the taxes imposed by such sections.
S 56. Paragraphs (b) and (c) of subdivision 1 of section 171-f of the
tax law, as amended by chapter 81 of the laws of 1995, are amended to
read as follows:
(b) "taxpayer" shall mean a corporation, association, company, part-
nership, estate, trust, liquidator, fiduciary or other entity or indi-
vidual who or which is liable for any tax or other imposition imposed by
or pursuant to article nine, nine-A, twenty-two, thirty, thirty-A, thir-
ty-B[, thirty-two,] or thirty-three of this chapter or article two-E of
the general city law, which tax or other imposition is administered by
the commissioner of taxation and finance, or who or which is under a
duty to perform an act under or pursuant to such tax or imposition,
excluding a state agency, a municipal corporation or a district corpo-
ration; and (c) "overpayment" shall mean an overpayment which has been
requested or determined to be refunded, a refund or a reimbursement, of
a tax or other imposition imposed by or pursuant to article nine,
nine-A, twenty-two, thirty, thirty-A, thirty-B[, thirty-two,] or thir-
ty-three of this chapter or article two-E of the general city law, which
is administered by the commissioner of taxation and finance.
S 57. Subdivision 2 of section 171-f of the tax law, as added by chap-
ter 55 of the laws of 1992, is amended to read as follows:
(2) The commissioner of taxation and finance, upon agreement with the
state comptroller and acting as an agent for the state comptroller,
shall set forth the procedures for crediting any overpayment by a
taxpayer of any tax or other imposition imposed by or authorized to be
imposed pursuant to article nine, nine-A, twenty-two, thirty, thirty-A,
thirty-B[, thirty-two,] or thirty-three of this chapter or article two-E
of the general city law, which is administered by the commissioner of
taxation and finance, and the interest on any such overpayments, against
the amount of a past-due legally enforceable debt owed by such taxpayer
to a state agency. An implementation plan shall be developed by the
division of the budget and the department of taxation and finance which
shall provide, but not be limited to, guidance with respect to coordi-
nation of debt collection pursuant to this section and subdivision twen-
ty-seventh of section one hundred seventy-one of this article. This
section shall not be deemed to abrogate or limit in any way the powers
S. 6359 129 A. 8559
and authority of the state comptroller to set off debts owed the state
against payments from the state, under the constitution of the state or
any other law.
S 58. Paragraphs (a) and (b) of subdivision 1 of section 171-l of the
tax law, as added by section 6 of part R of chapter 60 of the laws of
2004, are amended to read as follows:
(a) "taxpayer" shall mean a corporation, association, company, part-
nership, estate, trust, liquidator, fiduciary or other entity or indi-
vidual who or which is liable for any tax or other imposition imposed by
or pursuant to article nine, nine-A, twenty-two, thirty, thirty-A, thir-
ty-B[, thirty-two,] or thirty-three of this chapter, which tax or other
imposition is administered by the commissioner of taxation and finance,
or who or which is under a duty to perform an act under or pursuant to
such tax or imposition, excluding a state agency, a municipal corpo-
ration or a district corporation;
(b) "overpayment" shall mean an overpayment which has been requested
or determined to be refunded, a refund or a reimbursement, of a tax or
other imposition imposed by or pursuant to article nine, nine-A, twen-
ty-two, thirty, thirty-A, thirty-B[, thirty-two,] or thirty-three of
this chapter, which is administered by the commissioner of taxation and
finance; and
S 59. Paragraph (b) of subdivision 1 of section 183 of the tax law, as
amended by section 1 of part Y of chapter 63 of the laws of 2000, is
amended to read as follows:
(b) For the privilege of exercising its corporate franchise, or of
doing business, or of employing capital, or of owning or leasing proper-
ty in this state in a corporate or organized capacity, or of maintaining
an office in this state, every domestic corporation, joint-stock company
or association formed for or principally engaged in the conduct of
canal, steamboat, ferry (except a ferry company operating between any of
the boroughs of the city of New York under a lease granted by the city),
express, navigation, pipe line, transfer, baggage express, omnibus,
taxicab, telegraph, or telephone business, or formed for or principally
engaged in the conduct of two or more of such businesses, and every
domestic corporation, joint-stock company or association formed for or
principally engaged in the conduct of a railroad, palace car, sleeping
car or trucking business or formed for or principally engaged in the
conduct of two or more of such businesses and which has made an election
pursuant to subdivision ten of this section, and every other domestic
corporation, joint-stock company or association principally engaged in
the conduct of a transportation or transmission business, except a
corporation, joint-stock company or association formed for or principal-
ly engaged in the conduct of a railroad, palace car, sleeping car or
trucking business or formed for or principally engaged in the conduct of
two or more of such businesses and which has not made the election
provided for in subdivision ten of this section, and except a corpo-
ration, joint-stock company or association principally engaged in the
conduct of aviation (including air freight forwarders acting as princi-
pal and like indirect air carriers) and except a corporation principally
engaged in providing telecommunication services between aircraft and
dispatcher, aircraft and air traffic control or ground station and
ground station (or any combination of the foregoing), at least ninety
percent of the voting stock of which corporation is owned, directly or
indirectly, by air carriers and which corporation's principal function
is to fulfill the requirements of (i) the federal aviation adminis-
tration (or the successor thereto) or (ii) the international civil
S. 6359 130 A. 8559
aviation organization (or the successor thereto), relating to the exist-
ence of a communication system between aircraft and dispatcher, aircraft
and air traffic control or ground station and ground station (or any
combination of the foregoing) for the purposes of air safety and naviga-
tion [and except a corporation, joint-stock company or association
subject to taxation under article thirty-two of this chapter,] shall
pay, in advance, an annual tax to be computed upon the basis of the
amount of its capital stock within this state during the preceding year,
and upon each dollar of such amount. Provided, however, a corporation,
joint-stock company or association formed for or principally engaged in
the transportation, transmission or distribution of gas, electricity or
steam shall not be subject to tax under this section or section one
hundred eighty-four of this article.
S 60. Subdivision 10 of section 183 of the tax law, as added by chap-
ter 309 of the laws of 1996, is amended to read as follows:
10. Election. [With respect to taxable years beginning after nineteen
hundred ninety-seven, every] EVERY corporation, joint-stock company or
association formed for or principally engaged in the conduct of a rail-
road (including surface railroad, whether or not operated by steam,
subway railroad or elevated railroad), palace car, sleeping car or
trucking business or formed for or principally engaged in the conduct of
two or more of such businesses, which would be subject to article nine-A
[or thirty-two] of this chapter if the election provided for under this
subdivision were not made, may elect to be subject to the provisions of
this section and, as applicable, section one hundred eighty-four of this
article, rather than the provisions of such article nine-A [or thirty-
two]. [In the case of such a corporation, joint-stock company or associ-
ation subject to the tax imposed under this section and, as applicable,
section one hundred eighty-four of this article, for the taxable year
ending December thirty-first, nineteen hundred ninety-seven, such corpo-
ration, joint-stock company or association must make such election on or
before March fifteenth, nineteen hundred ninety-eight, and such election
shall apply to the taxable year ending on December thirty-first, nine-
teen hundred ninety-eight and to succeeding taxable years, until
revoked. In the case of such a corporation, joint-stock company or asso-
ciation which is not subject to the tax imposed under this section and,
as applicable, section one hundred eighty-four of this article for the
taxable year ending December thirty-first, nineteen hundred ninety-sev-
en, but thereafter would be subject to article nine-A or thirty-two of
this chapter if the election provided for under this subdivision were
not made, such] SUCH corporation, joint-stock company or association
must make such election by the first day on which such corporation,
joint-stock company or association would be required to file a return or
report (without regard to extensions) under this section or section one
hundred eighty-four of this article, or section one hundred eighty-
three-a or one hundred[-]eighty-four-a of this article, or article
nine-A [or thirty-two] of this chapter. An election made pursuant to
this subdivision shall continue to be in effect until revoked by the
taxpayer. A revocation of the election to be subject to this section
and, as applicable, section one hundred eighty-four of this article,
shall be irrevocable. Such election, and a revocation thereof, shall be
made in the manner prescribed by the commissioner, whether by regulation
or otherwise. Such revocation shall apply as of the first day of January
next following the end of a taxable year with respect to which the
taxpayer had been subject to this section and, as applicable, section
S. 6359 131 A. 8559
one hundred eighty-four of this article, by reason of an election made
pursuant to this subdivision.
S 61. The section heading and subdivisions 1 and 5 of section 183-a of
the tax law, the section heading as added by chapter 931 of the laws of
1982, subdivision 1 as amended by section 1 of part A of chapter 59 of
the laws of 2013 and subdivision 5 as amended by chapter 945 of the laws
of 1990, are amended to read as follows:
[Temporary metropolitan] METROPOLITAN transportation business tax
surcharge on transportation and transmission corporations and associ-
ations. 1. The term "corporation" as used in this section shall include
an association, within the meaning of paragraph three of subsection (a)
of section seventy-seven hundred one of the internal revenue code
(including a limited liability company), a publicly traded partnership
treated as a corporation for purposes of the internal revenue code
pursuant to section seventy-seven hundred four thereof and any business
conducted by a trustee or trustees wherein interest or ownership is
evidenced by certificates or other written instruments. Every corpo-
ration, joint-stock company or association formed for or principally
engaged in the conduct of canal, steamboat, ferry (except a ferry compa-
ny operating between any of the boroughs of the city of New York under a
lease granted by the city), express, navigation, pipe line, transfer,
baggage express, omnibus, taxicab, telegraph, or telephone business, or
formed for or principally engaged in the conduct of two or more such
businesses, and every corporation, joint-stock company or association
formed for or principally engaged in the conduct of a railroad, palace
car, sleeping car or trucking business or formed for or principally
engaged in the conduct of two or more of such businesses and which has
made an election pursuant to subdivision ten of section one hundred
eighty-three of this article, and every other corporation, joint-stock
company or association principally engaged in the conduct of a transpor-
tation or transmission business, except a corporation, joint-stock
company or association formed for or principally engaged in the conduct
of a railroad, palace car, sleeping car or trucking business or formed
for or principally engaged in the conduct of two or more of such busi-
nesses and which has not made the election provided for in subdivision
ten of section one hundred eighty-three of this article, and except a
corporation, joint-stock company or association principally engaged in
the conduct of aviation (including air freight forwarders acting as
principal and like indirect air carriers) and except a corporation prin-
cipally engaged in providing telecommunication services between aircraft
and dispatcher, aircraft and air traffic control or ground station and
ground station (or any combination of the foregoing), at least ninety
percent of the voting stock of which corporation is owned, directly or
indirectly, by air carriers and which corporation's principal function
is to fulfill the requirements of (i) the federal aviation adminis-
tration (or the successor thereto) or (ii) the international civil
aviation organization (or the successor thereto), relating to the exist-
ence of a communication system between aircraft and dispatcher, aircraft
and air traffic control or ground station and ground station (or any
combination of the foregoing) for the purposes of air safety and naviga-
tion [and except a corporation, joint-stock company or association which
is liable to taxation under article thirty-two of this chapter], shall
pay for the privilege of exercising its corporate franchise, or of doing
business, or of employing capital, or of owning or leasing property in
the metropolitan commuter transportation district in such corporate or
organized capacity, or of maintaining an office in such district, a tax
S. 6359 132 A. 8559
surcharge [for all or any part of its years commencing on or after Janu-
ary first, nineteen hundred eighty-two but ending before December thir-
ty-first, two thousand eighteen], which tax surcharge, in addition to
the tax imposed by section one hundred eighty-three of this article,
shall be computed at the rate of [eighteen percent of the tax imposed
under such section one hundred eighty-three for such years or any part
of such years ending before December thirty-first, nineteen hundred
eighty-three after the deduction of any credits otherwise allowable
under this article, and at the rate of] seventeen percent of the tax
imposed under such section for such years or any part of such years
[ending on or after December thirty-first, nineteen hundred eighty-
three] after the deduction of any credits otherwise allowable under this
article; provided, however, that such rates of tax surcharge shall be
applied only to that portion of the tax imposed under section one
hundred eighty-three of this article after the deduction of any credits
otherwise allowable under this article which is attributable to the
taxpayer's business activity carried on within the metropolitan commuter
transportation district as so determined in the manner prescribed by the
rules and regulations promulgated by the commissioner[; and provided,
further, that the tax surcharge imposed by this section shall not be
imposed upon any taxpayer for more than four hundred thirty-two months].
5. [The report covering the tax surcharge which must be calculated
pursuant to this section based upon the tax reportable on the report due
by March fifteenth, nineteen hundred eighty-two under section one
hundred eighty-three of this article shall be filed on or before March
fifteenth, nineteen hundred eighty-three. The report covering the tax
surcharge which must be calculated pursuant to this section based upon
the tax reportable on the report due by March fifteenth, nineteen
hundred eighty-three under section one hundred eighty-three of this
article shall be filed on or before March fifteenth, nineteen hundred
eighty-four. The report covering the tax surcharge which must be calcu-
lated pursuant to this section based upon the tax reportable on the
report due by March fifteenth, nineteen hundred eighty-four under
section one hundred eighty-three of this article shall be filed on or
before March fifteenth, nineteen hundred eighty-five. The report cover-
ing the tax surcharge which must be calculated pursuant to this section
based upon the tax reportable on the report due by March fifteenth,
nineteen hundred eighty-five under section one hundred eighty-three of
this article shall be filed on or before March fifteenth, nineteen
hundred eighty-six. The report covering the tax surcharge which must be
calculated pursuant to this section based upon the tax reportable on the
report due by March fifteenth, nineteen hundred eighty-six under section
one hundred eighty-three of this article shall be filed on or before
March fifteenth, nineteen hundred eighty-seven. The report covering the
tax surcharge which must be calculated pursuant to this section based
upon the tax reportable on the report due by March fifteenth, nineteen
hundred eighty-seven under section one hundred eighty-three of this
article shall be filed on or before March fifteenth, nineteen hundred
eighty-eight. The report covering the tax surcharge which must be calcu-
lated pursuant to this section based upon the tax reportable on the
report due by March fifteenth, nineteen hundred eighty-eight under
section one hundred eighty-three of this article shall be filed on or
before March fifteenth, nineteen hundred eighty-nine. The report cover-
ing the tax surcharge which must be calculated pursuant to this section
based upon the tax reportable on the report due by March fifteenth,
nineteen hundred eighty-nine under section one hundred eighty-three of
S. 6359 133 A. 8559
this article shall be filed on or before March fifteenth, nineteen
hundred ninety.] The report covering the tax surcharge which must be
calculated pursuant to this section based upon the tax reportable on the
report due by March fifteenth of any year [subsequent to nineteen
hundred eighty-nine] under section one hundred eighty-three of this
article shall be filed on or before March fifteenth of the year next
succeeding such year. An extension pursuant to section one hundred nine-
ty-three OF THIS ARTICLE shall be allowed only if a taxpayer files with
the commissioner an application for extension in such form as said
commissioner may prescribe by regulation and pays on or before the date
of such filing in addition to any other amounts required under this
article, either ninety percent of the entire tax surcharge required to
be paid under this section for the applicable period, or not less than
the tax surcharge shown on the taxpayer's report for the preceding year,
if such preceding year consisted of twelve months. The tax surcharge
imposed by this section shall be payable to the commissioner in full at
the time the report is required to be filed, and such tax surcharge or
the balance thereof, imposed on any taxpayer which ceases to exercise
its franchise or be subject to the tax surcharge imposed by this section
shall be payable to the commissioner at the time the report is required
to be filed, provided such tax surcharge of a domestic corporation which
continues to possess its franchise shall be subject to adjustment as the
circumstances may require; all other tax surcharges of any such taxpay-
er, which pursuant to the foregoing provisions of this section would
otherwise be payable subsequent to the time such report is required to
be filed, shall nevertheless be payable at such time. All of the
provisions of this article presently applicable to section one hundred
eighty-three of this article are applicable to the tax surcharge imposed
by this section except for section one hundred ninety-two of this arti-
cle.
S 62. Subdivision 1 of section 184 of the tax law, as amended by
section 2 of part Y of chapter 63 of the laws of 2000, is amended to
read as follows:
1. The term "corporation" as used in this section shall include an
association, within the meaning of paragraph three of subsection (a) of
section seventy-seven hundred one of the internal revenue code (includ-
ing a limited liability company), a publicly traded partnership treated
as a corporation for purposes of the internal revenue code pursuant to
section seventy-seven hundred four thereof.
Every corporation, joint-stock company or association formed for or
principally engaged in the conduct of canal, steamboat, ferry (except a
ferry company operating between any of the boroughs of the city of New
York under a lease granted by the city), express, navigation, pipe line,
transfer, baggage express, omnibus, taxicab, telegraph or local tele-
phone business, or formed for or principally engaged in the conduct of
two or more of such businesses, and every corporation, joint-stock
company or association formed for or principally engaged in the conduct
of surface railroad, whether or not operated by steam, subway railroad,
elevated railroad, palace car, sleeping car or trucking business or
formed for or principally engaged in the conduct of two or more such
businesses and which has made an election pursuant to subdivision ten of
section one hundred eighty-three of this article, and every other corpo-
ration, joint-stock company or association formed for or principally
engaged in the conduct of a transportation or transmission business
(other than a telephone business), except a corporation, joint-stock
company or association formed for or principally engaged in the conduct
S. 6359 134 A. 8559
of a surface railroad, whether or not operated by steam, subway rail-
road, elevated railroad, palace car, sleeping car or trucking business
or formed for or principally engaged in the conduct of two or more of
such businesses and which has not made the election provided for in
subdivision ten of section one hundred eighty-three of this article,
and, except a corporation, joint-stock company or association principal-
ly engaged in the conduct of aviation (including air freight forwarders
acting as principal and like indirect air carriers) and except a corpo-
ration principally engaged in providing telecommunication services
between aircraft and dispatcher, aircraft and air traffic control or
ground station and ground station (or any combination of the foregoing),
at least ninety percent of the voting stock of which corporation is
owned, directly or indirectly, by air carriers and which corporation's
principal function is to fulfill the requirements of (i) the federal
aviation administration (or the successor thereto) or (ii) the interna-
tional civil aviation organization (or the successor thereto), relating
to the existence of a communication system between aircraft and
dispatcher, aircraft and air traffic control or ground station and
ground station (or any combination of the foregoing) for the purposes of
air safety and navigation and [except a corporation, joint-stock company
or association which is liable to taxation under article thirty-two of
this chapter,] for the privilege of exercising its corporate franchise,
or of doing business, or of employing capital, or of owning or leasing
property in this state in a corporate or organized capacity, or main-
taining an office in this state, shall pay a franchise tax which shall
be equal to [(i) three-quarters of one percent for taxable years ending
before two thousand one, provided that for a taxable year ending in two
thousand the rate shall be reduced to three-eighths of one percent
effective July first, two thousand with the result that for purposes of
implementation of such change in rate the applicable rate for such a
year shall be nine-sixteenths of one percent, and (ii)] three-eighths of
one percent for taxable years commencing after two thousand, upon its
gross earnings from all sources within this state; except that, [for
taxable years commencing on or after January first, nineteen hundred
eighty-five and ending on or before December thirty-first, nineteen
hundred eighty-nine, every corporation, joint-stock company or associ-
ation formed for or principally engaged in the conduct of telephone or
telegraph business shall pay a franchise tax which shall be equal to
three-tenths of one per centum upon its gross earnings from all sources
within this state and,] for taxable years commencing on or after January
first, nineteen hundred ninety, every corporation, joint-stock company
or association formed for or principally engaged in the conduct of local
telephone business, or telegraph business shall pay a franchise tax
which shall be equal to [(i) three-quarters of one percent for taxable
years ending before two thousand one, provided that for a taxable year
ending in two thousand the rate shall be reduced to three-eighths of one
percent effective July first, two thousand with the result that for
purposes of implementation of such change in rate the applicable rate
for such a year shall be nine-sixteenths of one percent, and (ii)]
three-eighths of one percent for taxable years commencing after two
thousand, upon its gross earnings from all sources within this state,
except that a corporation, joint-stock company or association formed for
or principally engaged in the conduct of a local telephone business
shall exclude the following earnings (but not in any event earnings
derived by such taxpayer from the provision of carrier access services)
derived by such taxpayer from sales for ultimate consumption of telecom-
S. 6359 135 A. 8559
munications service to its customers (i) thirty percent of separately
charged intra-LATA toll service (which shall also include interregion
regional calling plan service) and (ii) one hundred percent of separate-
ly charged inter-LATA, interstate or international telecommunications
service; and except that [corporations, joint-stock companies or associ-
ations formed for or principally engaged in the conduct of surface rail-
road, whether or not operated by steam, subway railroad, elevated rail-
road, palace car or sleeping car, business or any other corporation
formed for or principally engaged in the conduct of a railroad business,
for taxable years prior to nineteen hundred ninety-seven, and] corpo-
rations, joint-stock companies or associations formed for or principally
engaged in the conduct of canal, steamboat, ferry (except a ferry compa-
ny operating between any of the boroughs of the city of New York under a
lease granted by the city), navigation or any corporation formed for or
principally engaged in the operation of vessels, shall pay a franchise
tax which shall be equal to three-quarters of one per centum upon its
gross earnings from all sources within this state, excluding earnings
derived from business of an interstate or foreign character; except that
for taxable years beginning in nineteen hundred ninety-seven or there-
after, in the case of a corporation, joint-stock company or association
which, with respect to taxable years beginning after nineteen hundred
ninety-seven, has made an election pursuant to subdivision ten of
section one hundred eighty-three of this article and which is formed for
or principally engaged in the conduct of surface railroad, whether or
not operated by steam, subway railroad, elevated railroad, palace car,
sleeping car or trucking business or formed for or principally engaged
in the conduct of two or more of such businesses, such corporation,
joint-stock company or association shall pay a franchise tax which shall
be equal to [(i) six-tenths of one percent for taxable years ending
before two thousand one, provided that for a taxable year ending in two
thousand the rate shall be reduced to three-eighths of one percent
effective July first, two thousand with the result that for purposes of
implementation of such change in rate the applicable rate for such a
year shall be thirty-nine eightieths of one percent, and (ii)] three-
eighths of one percent for taxable years commencing after two thousand,
upon its gross earnings from all sources within this state, provided
that in the case of a corporation, joint-stock company or association
formed for or principally engaged in the conduct of surface railroad,
whether or not operated by steam, subway railroad, elevated railroad,
palace car or sleeping car business, or formed for or principally
engaged in the conduct of two or more of such businesses, such gross
earnings shall not include earnings derived from business of an inter-
state or foreign character.
Provided, however, with respect to railroad, elevated railroad, palace
car or sleeping car business or any other corporation formed for or
principally engaged in the conduct of a railroad business and canal,
steamboat, ferry (except a ferry company operating between any of the
boroughs of the city of New York under a lease granted by the city),
navigation or any corporation formed for or principally engaged in the
operation of vessels where the gross earnings from such transportation
business both originating and terminating within this state and travers-
ing both this state and another state or states or country shall be
subject to the franchise tax imposed by this section (except where such
corporation, joint-stock company or association is formed for or princi-
pally engaged in the conduct of a railroad (including surface railroad,
whether or not operated by steam, subway railroad or elevated railroad),
S. 6359 136 A. 8559
palace car or sleeping car business or formed for or principally engaged
in the conduct of two or more of such businesses, and has not made the
election provided for under subdivision ten of section one hundred
eighty-three of this article) and such earnings shall be allocated to
this state in the same ratio that the mileage within the state bears to
the total mileage of such business. Provided, further, a corporation,
joint-stock company or association formed for or principally engaged in
the transportation, transmission or distribution of gas, electricity or
steam shall not be subject to tax under this section or section one
hundred eighty-three of this article.
The term "local telephone business" means the provision or furnishing
of telecommunication services for hire wherein the service furnished by
the provider thereof consists of carrier access service or the service
originates and terminates within the same local access and transport
area ("LATA"), a local access and transport area being that geographic
area as established and approved, and as so set and in existence on July
first, nineteen hundred ninety-four, pursuant to the modification of
final judgment in United States v. Western Electric Company (civil
action no. 82-0192) in the United States district court for the District
of Columbia or within the LATA-like Rochester non-associated independent
area.
The term "telecommunication services" shall have the meaning ascribed
to such term in section one hundred eighty-six-e of this article.
S 63. The section heading and the opening paragraph of subdivision 1
of section 184-a of the tax law, the section heading as added by chapter
931 of the laws of 1982 and the opening paragraph of subdivision 1 as
amended by section 2 of part A of chapter 59 of the laws of 2013, are
amended to read as follows:
Additional [temporary] metropolitan transportation business tax
surcharge on transportation and transmission corporations and associ-
ations services.
The term "corporation" as used in this section shall include an asso-
ciation, within the meaning of paragraph three of subsection (a) of
section seventy-seven hundred one of the internal revenue code (includ-
ing a limited liability company), and a publicly traded partnership
treated as a corporation for purposes of the internal revenue code
pursuant to section seventy-seven hundred four thereof. Every corpo-
ration, joint-stock company or association formed for or principally
engaged in the conduct of canal, steamboat, ferry (except a ferry compa-
ny operating between any of the boroughs of the city of New York under a
lease granted by the city), express, navigation, pipe line, transfer,
baggage express, omnibus, taxicab, telegraph or local telephone busi-
ness, or formed for or principally engaged in the conduct of two or more
such businesses, and every corporation, joint-stock company or associ-
ation formed for or principally engaged in the conduct of a surface
railroad, whether or not operated by steam, subway railroad, elevated
railroad, palace car, sleeping car or trucking business or principally
engaged in the conduct of two or more such businesses and which has made
an election pursuant to subdivision ten of section one hundred eighty-
three of this article, and every other corporation, joint-stock company
or association formed for or principally engaged in the conduct of a
transportation or transmission business (other than a telephone busi-
ness) except a corporation, joint-stock company or association formed
for or principally engaged in the conduct of a surface railroad, whether
or not operated by steam, subway railroad, elevated railroad, palace
car, sleeping car or trucking business or principally engaged in the
S. 6359 137 A. 8559
conduct of two or more such businesses and which has not made the
election provided for in subdivision ten of section one hundred eighty-
three of this article, and except a corporation, joint-stock company or
association principally engaged in the conduct of aviation (including
air freight forwarders acting as principal and like indirect air carri-
ers) and except a corporation principally engaged in providing telecom-
munication services between aircraft and dispatcher, aircraft and air
traffic control or ground station and ground station (or any combination
of the foregoing), at least ninety percent of the voting stock of which
corporation is owned, directly or indirectly, by air carriers and which
corporation's principal function is to fulfill the requirements of (i)
the federal aviation administration (or the successor thereto) or (ii)
the international civil aviation organization (or the successor there-
to), relating to the existence of a communication system between
aircraft and dispatcher, aircraft and air traffic control or ground
station and ground station (or any combination of the foregoing) for the
purposes of air safety and navigation [and except a corporation, joint-
stock company or association which is liable to taxation under article
thirty-two of this chapter], shall pay for the privilege of exercising
its corporate franchise, or of doing business, or of employing capital,
or of owning or leasing property in the metropolitan commuter transpor-
tation district in such corporate or organized capacity, or of maintain-
ing an office in such district, a tax surcharge [for all or any part of
its taxable years commencing on or after January first, nineteen hundred
eighty-two, but ending before December thirty-first, two thousand eigh-
teen], which tax surcharge, in addition to the tax imposed by section
one hundred eighty-four of this article, shall be computed at the rate
of [eighteen percent of the tax imposed under such section one hundred
eighty-four for such taxable years or any part of such taxable years
ending before December thirty-first, nineteen hundred eighty-three after
the deduction of any credits otherwise allowable under this article, and
at the rate of] seventeen percent of the tax imposed under such section
for such taxable years or any part of such taxable years [ending on or
after December thirty-first, nineteen hundred eighty-three] after the
deduction of any credits otherwise allowable under this article;
provided, however, that such rates of tax surcharge shall be applied
only to that portion of the tax imposed under section one hundred eight-
y-four of this article after the deduction of any credits otherwise
allowable under this article which is attributable to the taxpayer's
business activity carried on within the metropolitan commuter transpor-
tation district[; and provided, further, that the tax surcharge imposed
by this section on corporations, joint-stock companies and associations
formed for or principally engaged in the conduct of telephone or tele-
graph business shall be computed in accordance with this subdivision and
paragraph (c) of subdivision two of this section as if the three-quar-
ters of one percent rate of tax provided for in subdivision one of
section one hundred eighty-four of this article were applicable to such
telephone and telegraph businesses for taxable years commencing on or
after January first, nineteen hundred eighty-five and ending on or
before December thirty-first, nineteen hundred eighty-nine; and
provided, further, that the tax surcharge imposed by this section shall
not be imposed upon any taxpayer for more than four hundred thirty-two
months]. Provided, however, that for taxable years beginning in two
thousand and thereafter, for purposes of this subdivision the tax
imposed under section one hundred eighty-four of this article shall be
deemed to have been imposed at the rate of three-quarters of one
S. 6359 138 A. 8559
percent, except that in the case of a corporation, joint-stock company
or association which has made an election pursuant to subdivision ten of
section one hundred eighty-three of this article, for purposes of this
subdivision the tax imposed under section one hundred eighty-four of
this article shall be deemed to have been imposed at the rate of six-
tenths of one percent.
S 64. Subdivision 8 of section 186-a of the tax law is REPEALED.
S 65. The section heading and subdivision 1 of section 186-c of the
tax law, the section heading as amended by chapter 2 of the laws of
1995, subdivision 1 as amended by section 3 of part II-1 of chapter 57
of the laws of 2008, subparagraph 1 of paragraph (a) of subdivision 1 as
amended by section 3 of part A of chapter 59 f the laws of 2013, are
amended to read as follows:
[Temporary metropolitan] METROPOLITAN transportation business tax
surcharge on utility services and excise tax on sale of telecommuni-
cation services. 1. (a) (1) Every utility doing business in the metro-
politan commuter transportation district shall pay a tax surcharge, in
addition to the tax imposed by section one hundred eighty-six-a of this
article[, for all or any parts of its taxable years commencing on or
after January first, nineteen hundred eighty-two but ending before
December thirty-first, two thousand eighteen], to be computed [at the
rate of eighteen percent of the tax imposed under section one hundred
eighty-six-a of this article for such taxable years or any part of such
taxable years ending before December thirty-first, nineteen hundred
eighty-three after the deduction of any credits otherwise allowable
under this article, and] at the rate of seventeen percent of the tax
imposed under such section [for such taxable years or any part of such
taxable years ending on or after December thirty-first, nineteen hundred
eighty-three] after the deduction of credits otherwise allowable under
this article except any utility credit provided for by article thir-
teen-A of this chapter; provided, however, that such rates of tax
surcharge shall be applied only to that portion of the tax imposed under
section one hundred eighty-six-a of this article after the deduction of
credits otherwise allowable under this article, except any utility cred-
it provided for by article thirteen-A of this chapter, which is attrib-
utable to the taxpayer's gross income or gross operating income from
business activity carried on within the metropolitan commuter transpor-
tation district[; and provided, further, that the tax surcharge imposed
by this section shall not be imposed upon any taxpayer for more than
four hundred thirty-two months].
(2) Provided however, that [commencing January first, two thousand,]
in the case of the tax imposed under paragraph (a) of subdivision one of
section one hundred eighty-six-a of this article (relating to providers
of telecommunications services) such tax surcharge shall be calculated
as if the tax imposed under section one hundred eighty-six-a of this
article were imposed at a rate of three and one-half percent.
(b) In addition to the surcharge imposed by paragraph (a) of this
subdivision, there is hereby imposed a surcharge on the gross receipts
from telecommunication services relating to the metropolitan commuter
transportation district at the rate of seventeen percent of the state
tax rate under section one hundred eighty-six-e of this article [for all
or part of taxable years commencing on and after January first, nineteen
hundred ninety-five but ending before December thirty-first, two thou-
sand thirteen]. All the definitions and other provisions of section one
hundred eighty-six-e of this article shall apply to the tax imposed by
this paragraph with such modification and limitation as may be necessary
S. 6359 139 A. 8559
(including substituting the words "metropolitan commuter transportation
district" for "state" where appropriate) in order to adapt the language
of such section one hundred eighty-six-e of this article to the
surcharge imposed by this paragraph within such metropolitan commuter
transportation district so as to include (1) any intra-district telecom-
munication services, except any telecommunication services the gross
receipts from which are subject to tax under subparagraph four of this
paragraph, (2) any inter-district telecommunication services which orig-
inate or terminate in such district and are charged to a service address
therein regardless of where the amounts charged for such services are
billed or ultimately paid, except any telecommunications services the
gross receipts from which are subject to tax under subparagraph four of
this paragraph, (3) as apportioned to such district, private telecommu-
nication services, except any telecommunication services the gross
receipts from which are subject to tax under subparagraph four of this
paragraph, and (4) mobile telecommunications service provided by a home
service provider where the place of primary use is within such metropol-
itan commuter transportation district. Provided however, [commencing
October first, nineteen hundred ninety-eight] such tax surcharge shall
be calculated as if the tax imposed under section one hundred eighty-
six-e of this article were imposed at a rate of three and one-half
percent.
S 66. Clause (iii) of subparagraph (D) of paragraph 3 of subsection
(b) of section 605 of the tax law, as added by chapter 658 of the laws
of 2003, is amended to read as follows:
(iii) Provided further, that for the purposes of item (I) of clause
(i) of this subparagraph, a trustee which is a banking corporation as
defined in subsection (a) of section fourteen hundred fifty-two of this
chapter, AS SUCH SECTION WAS IN EFFECT ON DECEMBER THIRTY-FIRST, TWO
THOUSAND FOURTEEN, and which is domiciled outside the state of New York
at the time it becomes a trustee of the trust shall be deemed to contin-
ue to be a trustee domiciled outside the state of New York notwithstand-
ing that it thereafter otherwise becomes a trustee domiciled in the
state of New York by virtue of being acquired by, or becoming an office
or branch of, a corporate trustee domiciled within the state of New
York.
S 67. Subparagraph (A) of paragraph 10 of subsection (a) of section
606 of the tax law, as amended by section 3 of part CC of chapter 85 of
the laws of 2002, is amended to read as follows:
(A) the business of which the individual is an owner is substantially
similar in operation and in ownership to a business entity taxable, or
previously taxable, under section one hundred eighty-three, one hundred
eighty-four[,] OR one hundred eighty-five [or one hundred eighty-six] of
article nine; article nine-A[, thirty-two] or thirty-three of this chap-
ter; 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), ARTICLE THIRTY-TWO OF
THIS CHAPTER OR WHICH WOULD HAVE BEEN SUBJECT TO TAX UNDER SUCH ARTICLE
THIRTY-TWO (AS SUCH ARTICLE WAS IN EFFECT ON DECEMBER THIRTY-FIRST, TWO
THOUSAND FOURTEEN) 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 five of this subsection with
respect to refunding of credit to new business would be evaded; or
S 68. Subparagraph (B) of paragraph 1 of subsection (i) of section 606
of the tax law, as amended by section 7 of part C-1 of chapter 57 of the
laws of 2009, clause (ix) as amended by section 4 of part G of chapter
S. 6359 140 A. 8559
59 of the laws of 2013, clause (xxxi) as added by section 5 of part MM
of chapter 59 of the laws of 2010, clause (xxxi) as added by section 14
of part Q of chapter 57 of the laws of 2010, clause (xxxii) as added by
section 6 of part V of chapter 61 of the laws of 2011, clause (xxxiii)
as added by section 4 of part D of chapter 56 of the laws of 2011,
clause (xxxiii) as added by section 5 of part E of chapter 56 of the
laws of 2011, clause (xxxiii) as added by chapter 604 of the laws of
2011, clause (xxxiv) as added by chapter 109 of the laws of 2012, clause
(xxxv) as added by section 2 of part AA of chapter 59 of the laws of
2013, clause (xxxv) as added by section 4 of part EE of chapter 59 of
the laws of 2013 and clause (xxxvi) as added by section 8 of part A of
chapter 68 of the laws of 2013, clause (xxxvii) as added by section 3 of
LBD number 74021-03-4, and clause (xxxvii) as added by section 5 of LBD
number 74039-02-4, is amended to read as follows:
(B) shall be treated as the owner of a new business with respect to
such share if the corporation qualifies as a new business pursuant to
paragraph [(j)] (F) of subdivision [twelve] ONE of section two hundred
[ten] TEN-B of this chapter.
With respect to the following The corporation's credit base under
credit under this section: section two hundred [ten or section
fourteen hundred fifty-six] TEN-B
of this chapter is:
(i) Investment tax credit under Investment credit base or qualified
subsection (a) rehabilitation expenditures under
subdivision [twelve] ONE of section
two hundred [ten] TEN-B
(ii) Empire zone investment Cost or other basis under
tax credit under subsection (j) subdivision [twelve-B] THREE
of section two hundred [ten] TEN-B
[(iii) Empire zone wage tax credit Eligible wages under subdivision
under subsection (k) nineteen of section two hundred
ten or subsection (e) of section
fourteen hundred fifty-six
(iv) Empire zone capital tax Qualified investments and
credit under subsection (l) contributions under subdivision
twenty of section two hundred ten
or subsection (d) of section
fourteen hundred fifty-six]
(v) Agricultural property tax Allowable school district property
credit under subsection (n) taxes under subdivision
[twenty-two] ELEVEN of
section two hundred [ten]
TEN-B
(vi) Credit for employment of Qualified first-year wages or
persons with disabilities qualified second-year wages under
under subsection (o) subdivision [twenty-three] TWELVE
of section two hundred [ten or
subsection (f) of section
fourteen hundred fifty-six] TEN-B
S. 6359 141 A. 8559
(vii) Employment incentive credit Applicable investment credit base
under subsection (a-1) under subdivision [twelve-D] TWO
of section two hundred [ten]
TEN-B
(viii) Empire zone employment Applicable investment credit
incentive credit under subsection under subdivision [twelve-C]
(j-1) FOUR of section
two hundred [ten] TEN-B
(ix) Alternative fuels Amount of credit under subdivision
and electric vehicle [twenty-four] THIRTY of section
recharging property two hundred [ten] TEN-B
credit under subsection (p)
(x) Qualified emerging technology Applicable credit base under
company employment credit under subdivision [twelve-E] SEVEN
subsection (q) of section two hundred [ten] TEN-B
(xi) Qualified emerging technology Qualified investments under
company capital tax credit under subdivision [twelve-F] EIGHT
subsection (r) of section two hundred [ten] TEN-B
(xii) Credit for purchase of an Cost of an automated external
automated external defibrillator defibrillator under subdivision
under subsection (s) [twenty-five] THIRTEEN of section
two hundred [ten or subsection
(j) of section fourteen hundred
fifty-six] TEN-B
(xiii) Low-income housing credit Credit amount under subdivision
under subsection (x) [thirty] FIFTEEN of section
two hundred [ten or subsection
(l) of section fourteen
hundred fifty-six] TEN-B
[(xiv) Credit for transportation For taxable years beginning
improvement contributions under before January first, two thousand
subsection (z) nine, amount of credit under
subdivision thirty-two of
section two hundred ten
or subsection (n) of section
fourteen hundred fifty-six]
(xv) QEZE credit for real property Amount of credit under subdivision
taxes under subsection (bb) [twenty-seven] FIVE of
section two hundred [ten
or subsection (o) of section
fourteen hundred fifty-six]
TEN-B
(xvi) QEZE tax reduction credit Amount of benefit period factor,
under subsection (cc) employment increase factor and zone
allocation factor (without regard
to pro ration) under subdivision
[twenty-eight] SIX of
S. 6359 142 A. 8559
section two hundred [ten
or subsection (p) of section
fourteen hundred fifty-six]
TEN-B and amount
of tax factor as determined under
subdivision (f) of section sixteen
(xvii) Green building credit under Amount of green building credit
subsection (y) under subdivision [thirty-one]
SIXTEEN of section two
hundred [ten or subsection (m)
of section fourteen hundred
fifty-six] TEN-B
(xviii) Credit for long-term care Qualified costs under subdivision
insurance premiums under subsection [twenty-five-a] FOURTEEN
(aa) of section two hundred [ten
or subsection (k) of
section fourteen hundred fifty-six]
TEN-B
(xix) Brownfield redevelopment Amount of credit under subdivision
credit under subsection (dd) [thirty-three] SEVENTEEN
of section two hundred
[ten or subsection (q) of section
fourteen hundred fifty-six]
TEN-B
(xx) Remediated brownfield credit Amount of credit under subdivision
for real property taxes for [thirty-four] EIGHTEEN
qualified sites under subsection of section two hundred
(ee) [ten of subsection (r) of section
fourteen hundred fifty-six]
TEN-B
(xxi) Environmental remediation Amount of credit under subdivision
insurance credit under subsection [thirty-five] NINETEEN
(ff) of section two hundred
[ten or subsection (s) of section
fourteen hundred fifty-six]
TEN-B
(xxii) Empire state film Amount of credit for qualified
production credit under production costs in production of a
subsection (gg) qualified film under subdivision
[thirty-six] TWENTY of
section two hundred [ten] TEN-B
[(xxiii) Qualified emerging Qualifying expenditures and
technology company facilities, development activities under
operations and training credit subdivision twelve-G of section two
under subsection (nn) hundred ten]
(xxiv) Security training tax credit Amount of credit under subdivision
under subsection (ii) [thirty-seven] TWENTY-ONE
of section two hundred
S. 6359 143 A. 8559
[ten or under subsection (t) of
section fourteen hundred fifty-six]
TEN-B
[(xxv) Credit for qualified fuel For taxable years beginning before
cell electric generating January first, two thousand nine,
equipment expenditures amount of credit under subdivision
under subsection (g-2) thirty-seven of section two hundred
ten or subsection (t) of section
fourteen hundred fifty-six]
(xxvi) Empire state commercial Amount of credit for qualified
production credit under subsection production costs in production of
(jj) a qualified commercial under
subdivision [thirty-eight]
TWENTY-THREE of
section two hundred [ten]
TEN-B
(xxvii) Biofuel production tax Amount of credit under subdivision
credit under subsection (jj) [thirty-eight] TWENTY-FOUR
of section two hundred [ten]
TEN-B
(xxviii) Clean heating fuel credit Amount of credit under subdivision
under subsection (mm) [thirty-nine] TWENTY-FIVE of
section two hundred [ten]
TEN-B
(xxix) Credit for rehabilitation Amount of credit under subdivision
of historic properties under [forty] TWENTY-SIX of
subsection (oo) section two hundred [ten]
TEN-B
(xxxi) Excelsior jobs program tax Amount of credit under subdivision
credit under subsection (qq) [forty-one] THIRTY-ONE of
section two hundred [ten
or under subdivision (u) of
section fourteen hundred fifty-six]
TEN-B
(xxxi) Empire state film Amount of credit for
post production credit under qualified post production
subsection (qq) costs of a qualified film
under subdivision [forty-one]
THIRTY-TWO of section
two hundred [ten] TEN-B
(xxxii) Economic transformation Amount of credit under subdivision
and facility redevelopment credit [forty-three] THIRTY-FIVE
of section [210 or under
subsection (x) of section fourteen
hundred fifty-six] TWO HUNDRED
TEN-B
(xxxiii) New York youth works Amount of credit under
S. 6359 144 A. 8559
tax credit subdivision [forty-four] THIRTY-SIX
of section two hundred [ten]
TEN-B
(xxxiii) Empire state jobs Amount of credit under
retention program credit subdivision [forty-four]
THIRTY-SEVEN of section
two hundred [ten or under
subsection (y) of section
fourteen hundred fifty-six]
TEN-B
(xxxiii) Credit for companies who Amount of credit under
provide transportation to subdivision [forty-four]
individuals with disabilities THIRTY-EIGHT of section
under subsection (tt) two hundred [ten] TEN-B
(xxxiv) Beer production credit Amount of credit under
under subsection (uu) [subdivision] subdivision
[forty-five] THIRTY-NINE of
section two hundred [ten]
TEN-B
(xxxv) Hire a vet credit Amount of credit under subdivision
under subsection (a-2) [twenty-three-a] TWENTY-NINE
of section two hundred [ten
or subsection (e-1) of
of section fourteen hundred
fifty-six] TEN-B
(xxxv) Minimum wage reimbursement Amount of credit under subdivision
credit under subsection (aaa) [forty-six] FORTY
of section two hundred
[ten or subsection (z) of
section fourteen hundred
fifty-six] TEN-B
(xxxvi) Tax-free NY area tax Amount of credit under
elimination credit subdivision [forty-seven] FORTY-ONE
of section two hundred [ten]
TEN-B
(xxxvii) Real property tax Amount of credit under
credit for manufacturers subdivision [forty-eight]
under subsection (xx) FORTY-THREE of section
two hundred [ten] TEN-B
(xxxvii) Tax-free NY area Amount of credit under
excise tax on subdivision [forty-eight]
telecommunications services FORTY-FOUR of section
credit under subsection (xx) two hundred [ten] TEN-B
S 69. Subparagraphs (A) and (B) of paragraph 3 of subsection (i) of
section 606 of the tax law, as added by chapter 170 of the laws of 1994,
are amended to read as follows:
S. 6359 145 A. 8559
(A) Credit carryover. Any excess credit under subparagraph (A) of
paragraph one of this subsection, as it was in effect for taxable years
beginning before nineteen hundred ninety-four, may be carried over to
the shareholder's following year or years and may be deducted from such
shareholder's tax for such year or years, except that any excess credit
attributable to subdivision [twelve] ONE of section two hundred [ten]
TEN-B of this chapter shall in no event be carried over beyond the ten
taxable years next following the taxable year of origin.
(B) Credit recapture. Any redetermination of credit required by this
subsection as it was in effect for taxable years beginning before nine-
teen hundred ninety-four, upon disposition or cessation of qualified use
of property pursuant to paragraph [(g)] (E) of subdivision [twelve] ONE,
OR paragraph (f) of subdivision [twelve-B or paragraph (f) of subdivi-
sion eighteen] THREE of section two hundred [ten] TEN-B of this chapter
shall be attributed in pro rata shares to the shareholders who were
allowed credit under this subsection with respect to such property, and
the reduction of a shareholder's proportionate stock interest shall be
treated as a disposition of property for which a redetermination of
credit under such paragraphs is required with respect to such sharehold-
er.
S 70. Subparagraph (B) of paragraph 3 and paragraph 21 of subsection
(b) and paragraph 21 of subsection (c) of section 612 of the tax law,
subparagraph (B) of paragraph 3 of subsection (b) as amended by section
57, paragraph 21 of subsection (b) as amended by section 59 and para-
graph 21 of subsection (c) as amended by section 60 of part A of chapter
389 of the laws of 1997, are amended to read as follows:
(B) Shareholders of S corporations. In the case of a shareholder of an
S corporation, with respect to taxes imposed upon or payable by the
corporation, the term "income taxes" in subparagraph (A) of this para-
graph shall also include the taxes imposed under [articles] ARTICLE
nine-A [and thirty-two] of this chapter, regardless of the measure of
such tax, but shall not otherwise include taxes imposed by this or any
other state of the United States, or any political subdivision of this
or any other state, or the District of Columbia.
(21) In relation to the disposition of stock or indebtedness of a
corporation which elected under subchapter s of chapter one of the
internal revenue code for any taxable year of such corporation begin-
ning, in the case of a corporation taxable under article nine-A of this
chapter, after December thirty-first, nineteen hundred eighty, [and in
the case of a corporation taxable under article thirty-two of this chap-
ter, after December thirty-first, nineteen hundred ninety-six,] the
amount required to be added to federal adjusted gross income pursuant to
subsection (n) of this section.
(21) In relation to the disposition of stock or indebtedness of a
corporation which elected under subchapter s of chapter one of the
internal revenue code for any taxable year of such corporation begin-
ning, in the case of a corporation taxable under article nine-A of this
chapter, after December thirty-first, nineteen hundred eighty, [and in
the case of a corporation taxable under article thirty-two of this chap-
ter, after December thirty-first, nineteen hundred ninety-six,] the
amounts required to be subtracted from federal adjusted gross income
pursuant to subsection (n) of this section.
S 71. Paragraph 2 of subsection (a) of section 632 of the tax law, as
amended by section 2 of part C of chapter 57 of the laws of 2010, is
amended to read as follows:
S. 6359 146 A. 8559
(2) In determining New York source income of a nonresident shareholder
of an S corporation where the election provided for in subsection (a) of
section six hundred sixty of this article is in effect, there shall be
included only the portion derived from or connected with New York sourc-
es of such shareholder's pro rata share of items of S corporation
income, loss and deduction entering into his federal adjusted gross
income, increased by reductions for taxes described in paragraphs two
and three of subsection (f) of section thirteen hundred sixty-six of the
internal revenue code, as such portion shall be determined under regu-
lations of the commissioner consistent with the applicable methods and
rules for allocation under article nine-A [or thirty-two] of this chap-
ter, regardless of whether or not such item or reduction is included in
entire net income under article nine-A [or thirty-two] for the tax year.
If a nonresident is a shareholder in an S corporation where the election
provided for in subsection (a) of section six hundred sixty of this
article is in effect, and the S corporation has distributed an install-
ment obligation under section 453(h)(1)(A) of the Internal Revenue Code,
then any gain recognized on the receipt of payments from the installment
obligation for federal income tax purposes will be treated as New York
source income allocated in a manner consistent with the applicable meth-
ods and rules for allocation under article nine-A [or thirty-two] of
this chapter in the year that the assets were sold. In addition, if the
shareholders of the S corporation have made an election under section
338(h)(10) of the Internal Revenue Code, then any gain recognized on the
deemed asset sale for federal income tax purposes will be treated as New
York source income allocated in a manner consistent with the applicable
methods and rules for allocation under article nine-A [or thirty-two] of
this chapter in the year that the shareholder made the section
338(h)(10) election. For purposes of a section 338(h)(10) election, when
a nonresident shareholder exchanges his or her S corporation stock as
part of the deemed liquidation, any gain or loss recognized shall be
treated as the disposition of an intangible asset and will not increase
or offset any gain recognized on the deemed assets sale as a result of
the section 338(h)(10) election.
S 72. Subparagraph (A) of paragraph 4 of subsection (c) of section 658
of the tax law, as amended by section 1 of part DD of chapter 686 of the
laws of 2003, is amended to read as follows:
(A) General. Every entity which is a partnership, other than a public-
ly traded partnership as defined in section 7704 of the federal Internal
Revenue Code, subchapter K limited liability company or an S corporation
for which the election provided for in subsection (a) of section six
hundred sixty of this [article] PART is in effect, which has partners,
members or shareholders who are nonresident individuals, as defined
under subsection (b) of section six hundred five of this article, or C
corporations, and which has any income derived from New York sources,
determined in accordance with the applicable rules of section six
hundred thirty-one of this article as in the case of a nonresident indi-
vidual, shall pay estimated tax on such income on behalf of such part-
ners, members or shareholders in the manner and at the times prescribed
by subsection (c) of section six hundred eighty-five of this article.
For purposes of this paragraph, the term "estimated tax" shall mean a
partner's, member's or shareholder's distributive share or pro rata
share of the entity income derived from New York sources, multiplied by
the highest rate of tax prescribed by section six hundred one of this
article for the taxable year of any partner, member or shareholder who
is an individual taxpayer, or paragraph (a) of subdivision one of
S. 6359 147 A. 8559
section two hundred ten of this chapter for the taxable year of any
partner, member or shareholder which is a C corporation, whether or not
such C corporation is subject to tax under article nine, nine-A[, thir-
ty-two,] or thirty-three of this chapter, and reduced by the distribu-
tive share or pro rata share of any credits determined under section one
hundred eighty-seven, one hundred eighty-seven-a, six hundred six[,
fourteen hundred fifty-six] or fifteen hundred eleven of this chapter,
whichever is applicable, derived from the entity.
S 73. Subsections (a) and (h) of section 660 of the tax law,
subsection (a) as amended by section 50 and subsection (h) as amended by
section 66 of part A of chapter 389 of the laws of 1997, are amended to
read as follows:
(a) Election. If a corporation is an eligible S corporation, the
shareholders of the corporation may elect in the manner set forth in
subsection (b) of this section to take into account, to the extent
provided for in this article (or in article thirteen of this chapter, in
the case of a shareholder which is a taxpayer under such article), the S
corporation items of income, loss, deduction and reductions for taxes
described in paragraphs two and three of subsection (f) of section thir-
teen hundred sixty-six of the internal revenue code which are taken into
account for federal income tax purposes for the taxable year. No
election under this subsection shall be effective unless all sharehold-
ers of the corporation have so elected. An eligible S corporation is (i)
an S corporation which is subject to tax under article nine-A [or thir-
ty-two] of this chapter, OR (ii) an S corporation which is the parent of
a qualified subchapter S subsidiary subject to tax under article nine-A,
where the shareholders of such parent corporation are entitled to make
the election under this subsection by reason of subparagraph three of
paragraph (k) of subdivision nine of section two hundred eight of this
chapter[; or (iii) an S corporation which is the parent of a qualified
subchapter S corporation subject to tax under article thirty-two, where
the shareholders of such parent are entitled to make the election under
this subsection by reason of paragraph three of subsection (o) of
section fourteen hundred fifty-three of this chapter].
(h) Cross reference. For definitions relating to S corporations, see
subdivision one-A of section two hundred eight [and subsections (f) and
(g) of section fourteen hundred fifty] of this chapter.
S 74. Paragraph 1 of subsection (i) of section 660 of the tax law, as
added by section 1 of part L of chapter 60 of the laws of 2007, is
amended to read as follows:
(1) Notwithstanding the provisions in subsection (a) of this section,
in the case of an eligible S corporation for which the election under
subsection (a) of this section is not in effect for the current taxable
year, the shareholders of an eligible S corporation are deemed to have
made that election effective for the eligible S corporation's entire
current taxable year, if the eligible S corporation's investment income
for the current taxable year is more than fifty percent of its federal
gross income for such year [provided that this subsection shall not
apply to an eligible S corporation that is subject to tax under article
thirty-two of this chapter]. IN DETERMINING AN ELIGIBLE S CORPORATION'S
INVESTMENT INCOME, THE INVESTMENT INCOME OF A QUALIFIED SUBCHAPTER S
SUBSIDIARY OWNED DIRECTLY OR INDIRECTLY BY THE ELIGIBLE S CORPORATION
SHALL BE INCLUDED.
S 75. Paragraph 3 of subsection (c) of section 1085 of the tax law, as
amended by section 15 of part Y of chapter 63 of the laws of 2000, is
amended to read as follows:
S. 6359 148 A. 8559
(3) The provisions of this subsection and subsections (d) and (e) of
this section shall apply to the failure of a taxpayer to file a declara-
tion of estimated tax surcharge or the failure to pay all or any part of
an amount which is applied as an installment against such estimated tax
surcharge pursuant to sections one hundred ninety-seven-a, one hundred
ninety-seven-b, two hundred thirteen-a, two hundred thirteen-b, [four-
teen hundred sixty, fourteen hundred sixty-one,] fifteen hundred thir-
teen and fifteen hundred fourteen of this chapter. For purposes of
applying this section and subsections (d) and (e) of this section to the
estimated tax surcharge, where appropriate the term "tax" shall be read
to mean "tax surcharge," and the terms "amount required to be paid,"
"amount which would be required to be paid," and "amount which would
have been required to be paid" shall be computed as the product of (1)
such amount computed without regard to the tax surcharges imposed under
sections one hundred eighty-four-a, one hundred eighty-six-c, one
hundred eighty-eight, two hundred nine-A, two hundred nine-B, [fourteen
hundred fifty-five-A, fourteen hundred fifty-five-B,] fifteen hundred
five-a, and fifteen hundred twenty of this chapter, and (2) the MTA
percentage. The term "MTA percentage" shall mean the product of (A) the
tax rate applicable under such sections imposing such surcharges and (B)
the percentage utilized in determining the portion of the taxpayer's
business activity carried on within the metropolitan commuter transpor-
tation district under such sections.
S 76. The opening paragraph of subparagraph (A) of paragraph 3 of
subsection (d) of section 1085 of the tax law, as amended by chapter 170
of the laws of 1994, is amended to read as follows:
An amount equal to ninety-one percent of the tax for the taxable year
computed on all items entering into the computation of the tax or taxes
of the taxpayer for the taxable year under article nine, nine-A[, thir-
ty-two] or thirty-three of this chapter. For purposes of computing the
tax, all items of receipts, income and expenses shall be placed on an
annualized basis--
S 77. Clause (i) of subparagraph (A) of paragraph 4 of subsection (d)
of section 1085 of the tax law, as amended by chapter 57 of the laws of
1993, is amended to read as follows:
(i) take the items entering into the computation of the tax or taxes
of the taxpayer for the taxable year under article nine, nine-A[, thir-
ty-two] or thirty-three of this chapter, for all months during the taxa-
ble year preceding the filing month,
S 78. Paragraph 5 of subsection (d) of section 1085 of the tax law, as
added by chapter 61 of the laws of 1989, is amended to read as follows:
(5) In the case of any declaration installment, any reduction in such
installment resulting from the application of paragraph three or four of
this subsection shall be recaptured by increasing the amount of the next
installment determined under paragraph one or two of this subsection or
paragraph one of subsection (c) of this section by the amount of such
reduction (and by increasing subsequent installments to the extent that
the reduction has not previously been recaptured under this paragraph).
For purposes of the preceding sentence, a declaration installment means
any installment of estimated tax other than the mandatory first install-
ment required under paragraph (a) of subdivision one of section one
hundred ninety-seven-b, subdivision (a) of section two hundred thir-
teen-b[, subsection (a) of section fourteen hundred sixty-one] or subdi-
vision (a) of section fifteen hundred fourteen of this chapter.
S. 6359 149 A. 8559
S 79. Paragraph 1 of subsection (e) of section 1085 of the tax law, as
amended by section 28-p of part H-3 of chapter 62 of the laws of 2003,
is amended to read as follows:
(1) Paragraphs (1) and (2) of subsection (d) of this section shall not
apply in the case of any corporation (or any predecessor corporation)
which had [entire net] BUSINESS income, or the portion thereof allocated
within the state, of one million dollars or more for any taxable year
during the three taxable years immediately preceding the taxable year
involved; provided, however, that in the case of a corporation subject
to tax under section fifteen hundred two-a of this chapter, paragraphs
(1) and (2) of subsection (d) of this section shall not apply if such
corporation had entire net income, or the portion thereof allocated
within the state, of one million dollars or more for any of the three
taxable years immediately preceding the taxable year involved, or if the
direct premiums subject to tax under section fifteen hundred two-a of
this chapter of the corporation for any of such three preceding taxable
years beginning on or after January first, two thousand three equals or
exceeds three million seven hundred fifty thousand dollars.
S 80. Subsections (m) and (o) of section 1085 of the tax law are
REPEALED.
S 81. Clause (ii) of subparagraph (B) of paragraph 2 of subsection
(q), paragraph 3 of subsection (s) and the closing paragraph of para-
graph 1 of subsection (t) of section 1085 of the tax law, as added by
section 10 of part N of chapter 61 of the laws of 2005, are amended to
read as follows:
(ii) fifty percent of the gross income that the organizer or material
advisor derived with respect to activities that were the basis for the
requirement to file, disclose or provide information pursuant to section
six thousand eleven of the internal revenue code, to the extent such
gross income is attributable to the avoidance of any tax imposed under
article nine, nine-A[, thirty-two,] or thirty-three of this chapter.
(3) For purposes of this subsection, the term "understatement of
liability" means any understatement of the net amount payable with
respect to any tax imposed under article nine, nine-A[, thirty-two,] or
thirty-three of this chapter or any overstatement of the net amount
creditable or refundable with respect to any such tax.
shall pay, with respect to each activity described in subparagraph (A)
of this paragraph, a penalty equal to one thousand dollars or, if the
person establishes that it is lesser, one hundred percent of the gross
income derived (or to be derived) by such person from such activity to
the extent such gross income is attributed to the avoidance of any tax
imposed under articles nine, nine-A[, thirty-two] or thirty-three of
this chapter; provided, however, that if an activity with respect to
which a penalty imposed under this subsection involves a statement
described in clause (i) of subparagraph (B) of paragraph one of this
subsection, the penalty shall be equal to fifty percent of the gross
income derived (or to be derived) from that activity within the state by
the person on which the penalty is imposed. For purposes of the preced-
ing sentence, activities described in clause (i) of subparagraph (A) of
this paragraph with respect to each entity or arrangement shall be
treated as a separate activity and participation in each sale described
in clause (ii) of subparagraph (A) of this paragraph shall be so treat-
ed.
S 82. The opening paragraph of subsection (c) of section 1087 of the
tax law, as separately amended by chapters 760 and 770 of the laws of
1992, is amended to read as follows:
S. 6359 150 A. 8559
If a taxpayer is required by subdivision three of section two hundred
eleven[, subsection (e) of section fourteen hundred sixty-two] or para-
graph one of subdivision (e) of section fifteen hundred fifteen OF THIS
CHAPTER, to file a report or amended return in respect of (i) a decrease
or increase in federal taxable income or federal alternative minimum
taxable income or federal tax, or (ii) a federal change or correction or
renegotiation, or computation or recomputation of tax, which is treated
in the same manner as if it were an overpayment for federal income tax
purposes, claim for credit or refund of any resulting overpayment of tax
shall be filed by the taxpayer within two years from the time such
report or amended return was required to be filed with the commissioner
[of taxation and finance]. If the report or amended return required by
any such provision of law is not filed within the period therein speci-
fied, no interest shall be payable on any claim for credit or refund of
the overpayment attributable to the federal change or correction. The
amount of such credit or refund--
S 83. Subsection (g) of section 1088 of the tax law, as amended by
chapter 61 of the laws of 1989 and relettered by chapter 55 of the laws
of 1992, is amended to read as follows:
(g) Cross-reference.--For provision with respect to interest after
failure to file a report or amended return under subdivision three of
section two hundred eleven[, subsection (e) of section fourteen hundred
sixty-two] or paragraph one of subdivision (e) of section fifteen
hundred fifteen, see subsection (c) of section one thousand eighty-sev-
en.
S 84. Paragraph 2 of subsection (b) of section 1096 of the tax law, as
amended by chapter 411 of the laws of 1986, is amended to read as
follows:
(2) The [tax commission] COMMISSIONER may take any action under para-
graph one of this subdivision to inquire into the commission of an
offense connected with the administration or enforcement of this article
or article nine, [nine-a] NINE-A, thirteen, [thirteen-a, thirty-two,]
THIRTEEN-A or thirty-three of this chapter, provided, however, that
notwithstanding the provisions of section one hundred seventy-four of
this chapter no such action shall be taken when a referral by the
department or the [tax commission] COMMISSIONER to the attorney general,
a district attorney or any other prosecutorial agency is in effect.
Provided, however, the [tax commission] COMMISSIONER shall have power,
during the period when such referral is in effect, to examine or to
cause to have examined, by any agent or representative designated by it
for that purpose, any books, papers, records or memoranda bearing upon
the matters required to be included in the return, where such books,
papers, records or memoranda are in its possession, or where such books,
papers, records or memoranda are in the possession of the attorney
general, district attorney or other prosecutorial agency to which such
referral is made.
S 85. Paragraph 1 of subsection (e) of section 1096 of the tax law, as
amended by section 8 of subpart D of part V1 of chapter 57 of the laws
of 2009, is amended to read as follows:
(1) Authority to set interest rates.---The commissioner shall set the
overpayment and underpayment rates of interest to be paid pursuant to
sections two hundred thirteen, two hundred thirteen-b, two hundred
fifty-eight, two hundred sixty-three, two hundred ninety-four, one thou-
sand eighty-four, one thousand eighty-five[,] AND one thousand eighty-
eight[, fourteen hundred sixty-one and fourteen hundred sixty-three] of
this chapter, but if no such rate or rates of interest are set, such
S. 6359 151 A. 8559
overpayment rate shall be deemed to be set at six percent per annum and
such underpayment rate shall be deemed to be set at seven and one-half
percent per annum. Such overpayment and underpayment rates shall be the
rates prescribed in paragraph two of this subsection, but the underpay-
ment rate shall not be less than seven and one-half percent per annum.
Any such rates set by the commissioner shall apply to taxes, or any
portion thereof, which remain or become due or overpaid on or after the
date on which such rates become effective and shall apply only with
respect to interest computed or computable for periods or portions of
periods occurring in the period during which such rates are in effect.
S 86. Subdivision (b) of section 1201-a of the tax law, as amended by
section 5 of part Y of chapter 62 of the laws of 2006, is amended to
read as follows:
(b) Empire state film production credit. Any city in this state having
a population of one million or more, acting through its local legisla-
tive body, is hereby authorized to adopt and amend local laws to allow a
credit against the general corporation tax and the unincorporated busi-
ness tax imposed pursuant to the authority of chapter seven hundred
seventy-two of the laws of nineteen hundred sixty-six which shall be
substantially identical to the credit allowed under section twenty-four
of this chapter, except that (A) the percentage of qualified production
costs used to calculate such credit shall be five percent, (B) whenever
such section twenty-four references the state, such words shall be read
as referencing the city, (C) such credit shall be allowed only to a
taxpayer which is a qualified film production company, and (D) the
effective date of such credit shall be July first, two thousand six.
Such credit shall be applied in a manner consistent with the credit
allowed under subdivision [thirty-six] TWENTY of section two hundred
[ten] TEN-B of this chapter except as may be necessary to take into
account differences between the general corporation tax and the unincor-
porated business tax.
S 87. Subdivision (c) of section 1201-a of the tax law, as amended by
chapter 300 of the laws of 2007, is amended to read as follows:
(c) Empire state commercial production credit. Any city in this state
having a population of one million or more, acting through its local
legislative body, is hereby authorized to adopt and amend local laws to
allow a credit against the general corporation tax and the unincorporat-
ed business tax imposed pursuant to the authority of chapter seven
hundred seventy-two of the laws of nineteen hundred sixty-six which
shall be substantially identical to the credit allowed under the
provisions of section twenty-eight of this chapter, except that (A) the
percentage of qualified production costs used to calculate such credit
shall be five percent, (B) whenever such section twenty-eight references
the state, such words shall be read as referencing the city, (C) such
credit shall be allowed only to a taxpayer that is a qualified commer-
cial production company, and (D) the effective date of such credit shall
be as provided in local laws. Such credit shall be applied in a manner
consistent with the credit allowed under subdivision [thirty-eight]
TWENTY-THREE of section two hundred [ten] TEN-B of this chapter except
as may be necessary to take into account differences between the general
corporation tax and unincorporated business tax.
S 88. The section heading and paragraphs 1 and 3 of subdivision (a) of
section 1505-a of the tax law, the section heading as added by chapter
11 of the laws of 1983 and paragraphs 1 and 3 of subdivision (a) as
amended by section 6 of part A of chapter 59 of the laws of 2013, are
amended to read as follows:
S. 6359 152 A. 8559
[Temporary metropolitan] METROPOLITAN transportation business tax
surcharge on insurance corporations.
(1) Every domestic insurance corporation and every foreign or alien
insurance corporation, and every life insurance corporation described in
subdivision (b) of section fifteen hundred one of this article, for the
privilege of exercising its corporate franchise, or of doing business,
or of employing capital, or of owning or leasing property in the metro-
politan commuter transportation district in a corporate or organized
capacity, or of maintaining an office in the metropolitan commuter
transportation district, [for all or any part of its taxable years
commencing on or after January first, nineteen hundred eighty-two, but
ending before December thirty-first, two thousand eighteen,] except
corporations specified in subdivision (c) of section fifteen hundred
twelve of this article, shall annually pay, in addition to the taxes
otherwise imposed by this article, a tax surcharge on the taxes imposed
under this article after the deduction of any credits otherwise allow-
able under this article as allocated to such district. Such taxes shall
be allocated to such district for purposes of computing such tax
surcharge upon taxpayers subject to tax under subdivision (b) of section
fifteen hundred ten of this article by applying the methodology, proce-
dures and computations set forth in subdivisions (a) and (b) of section
fifteen hundred four of this article, except that references to terms
denoting New York premiums, and total wages, salaries, personal service
compensation and commissions within New York shall be read as denoting
within the metropolitan commuter transportation district and terms
denoting total premiums and total wages, salaries, personal service
compensation and commissions shall be read as denoting within the state.
If it shall appear to the commissioner that the application of the meth-
odology, procedures and computations set forth in such subdivisions (a)
and (b) does not properly reflect the activity, business or income of a
taxpayer within the metropolitan commuter transportation district, then
the commissioner shall be authorized, in the commissioner's discretion,
to adjust such methodology, procedures and computations for the purpose
of allocating such taxes by:
(A) excluding one or more factors therein;
(B) including one or more other factors therein, such as expenses,
purchases, receipts other than premiums, real property or tangible
personal property; or
(C) any other similar or different method which allocates such taxes
by attributing a fair and proper portion of such taxes to the metropol-
itan commuter transportation district. The commissioner from time to
time shall publish all rulings of general public interest with respect
to any application of the provisions of the preceding sentence. The
commissioner may promulgate rules and regulations to further implement
the provisions of this section.
(3) Such tax surcharge shall be computed at the rate of [eighteen
percent of the taxes imposed under sections fifteen hundred one and
fifteen hundred ten of this article as limited by section fifteen
hundred five of this article, as allocated to such district, for such
taxable years or any part of such taxable years ending before December
thirty-first, nineteen hundred eighty-three after the deduction of any
credits otherwise allowable under this article, at the rate of seventeen
percent of the taxes imposed under such sections as limited by section
fifteen hundred five of this article, as allocated to such district, for
such taxable years or any part of such taxable years ending on or after
December thirty-first, nineteen hundred eighty-three and before January
S. 6359 153 A. 8559
first, two thousand three after the deduction of any credits otherwise
allowable under this article, and at the rate of] seventeen percent of
the taxes imposed under sections fifteen hundred one, fifteen hundred
two-a, and fifteen hundred ten of this article, as limited or otherwise
determined by subdivision (a) or (b) of section fifteen hundred five of
this article, as allocated to such district, [for such taxable years or
any part of such taxable years ending after December thirty-first, two
thousand two] after the deduction of any credits otherwise allowable
under this article[; provided, however, that the tax surcharge imposed
by this section shall not be imposed upon any taxpayer for more than
four hundred thirty-two months]. Provided however, that for taxable
years commencing on or after July first, two thousand, and in the case
of taxpayers subject to tax under section fifteen hundred two-a of this
article, for taxable years of such taxpayers beginning on or after July
first, two thousand and before January first, two thousand three, such
surcharge shall be calculated as if (i) the rate of the tax computed
under paragraph one of subdivision (a) of section fifteen hundred two of
this article was nine percent and (ii) the rate of the limitation on tax
set forth in section fifteen hundred five of this article for domestic,
foreign and alien insurance corporations except life insurance corpo-
rations was two and six-tenths percent.
S 89. Section 1825 of the tax law, as amended by section 2 of part E
of chapter 25 of the laws of 2009, is amended to read as follows:
S 1825. Violation of secrecy provisions of the tax law.--Any person
who violates the provisions of subdivision (b) of section twenty-one,
subdivision one of section two hundred two, subdivision eight of section
two hundred eleven, subdivision (a) of section three hundred fourteen,
subdivision one or two of section four hundred thirty-seven, section
four hundred eighty-seven, subdivision one or two of section five
hundred fourteen, subsection (e) of section six hundred ninety-seven,
subsection (a) of section nine hundred ninety-four, subdivision (a) of
section eleven hundred forty-six, section twelve hundred eighty-seven,
subdivision (a) of section fourteen hundred eighteen, [subsection (a) of
section fourteen hundred sixty-seven,] subdivision (a) of section
fifteen hundred eighteen, subdivision (a) of section fifteen hundred
fifty-five of this chapter, and subdivision (e) of section 11-1797 of
the administrative code of the city of New York shall be guilty of a
misdemeanor.
S 90. Subdivisions (s) and (t) of section 957 of the general municipal
law, as amended by section 1 of part S1 of chapter 57 of the laws of
2009, are amended to read as follows:
(s) "Qualified investment project" shall mean a project (i) located
within an empire zone, (ii) at which five hundred or more jobs will be
created, provided such jobs are new to the state and are in addition to
any other jobs previously created by the owner of such project in the
state, and (iii) which will consist of tangible personal property and
other tangible property, including buildings and structural components
of buildings, described in subparagraphs (i), (ii), (iii), (iv) and
clause (A) or (C) of subparagraph (v) of paragraph (b) of subdivision
[twelve-B] THREE of section two hundred [ten] TEN-B of the tax law, the
basis of which for federal income tax purposes will equal or exceed
seven hundred fifty million dollars. Provided however, the owner of such
project does not employ more than two hundred persons in the state at
the time such project is commenced.
(t) "Significant capital investment project" shall mean a project (i)
located within an empire zone, (ii) which will be either a newly
S. 6359 154 A. 8559
constructed facility or a newly constructed addition to or expansion of
a qualified investment project, consisting of tangible personal property
and other tangible property, including buildings and structural compo-
nents of buildings, described in subparagraphs (i), (ii), (iii), (iv)
and clause (A) or (C) of subparagraph (v) of paragraph (b) of subdivi-
sion [twelve-B] THREE of section two hundred [ten] TEN-B of the tax law,
the basis of which for federal income tax purposes will equal or exceed
seven hundred fifty million dollars, (iii) which is constructed after
the basis for federal income tax purposes of the property comprising
such qualified investment project equals or exceeds seven hundred fifty
million dollars, and (iv) at which five hundred or more jobs will be
created, provided such jobs are new to the state and are in addition to
any other jobs previously created by the owner of such project in the
state.
S 91. Subclauses (III) and (IV) of clause (ii) of subparagraph (B) of
paragraph 6 of subdivision (a) of section 292 of the tax law, as amended
by section 3 of part E of chapter 59 of the laws of 2013, are amended to
read as follows:
(III) [The adjustment required in this paragraph shall not apply if
the taxpayer establishes, by clear and convincing evidence of the type
and in the form specified by the commissioner, that: (a) the royalty
payment was paid, accrued or incurred to a related member organized
under the laws of a country other than the United States; (b) the
related member's income from the transaction was subject to a comprehen-
sive income tax treaty between such country and the United States; (c)
the related member was subject to tax in a foreign nation on a tax base
that included the royalty payment paid, accrued or incurred by the
taxpayer; (d) the related member's income from the transaction was taxed
in such country at an effective rate of tax at least equal to that
imposed by this state; and (e) the royalty payment was paid, accrued or
incurred pursuant to a transaction that was undertaken for a valid busi-
ness purpose and using terms that reflect an arm's length relationship.
(IV)] The adjustment required in this paragraph shall not apply if the
taxpayer and the commissioner agree in writing to the application or use
of alternative adjustments or computations. The commissioner may, in his
or her discretion, agree to the application or use of alternative
adjustments or computations when he or she concludes that in the absence
of such agreement the income of the taxpayer would not be properly
reflected.
S 92. Clauses (iii) and (iv) of subparagraph (B) of paragraph 2 of
subsection (r) of section 612 of the tax law, as amended by section 5 of
part E of chapter 59 of the laws of 2013, are amended to read as
follows:
(iii) [The adjustment required in this subsection shall not apply if
the taxpayer establishes, by clear and convincing evidence of the type
and in the form specified by the commissioner, that: (I) the royalty
payment was paid, accrued or incurred to a related member organized
under the laws of a country other than the United States; (II) the
related member's income from the transaction was subject to a comprehen-
sive income tax treaty between such country and the United States; (III)
the related member was subject to tax in a foreign nation on a tax base
that included the royalty payment paid, accrued or incurred by the
taxpayer; (IV) the related member's income from the transaction was
taxed in such country at an effective tax rate at least equal to that
imposed by this state; and (V) the royalty payment was paid, accrued or
S. 6359 155 A. 8559
incurred pursuant to a transaction that was undertaken for a valid busi-
ness purpose and using terms that reflect an arm's length relationship.
(iv)] The adjustment required in this subsection shall not apply if
the taxpayer and the commissioner agree in writing to the application or
use of alternative adjustments or computations. The commissioner may, in
his or her discretion, agree to the application or use of alternative
adjustments or computations when he or she concludes that in the absence
of such agreement the income of the taxpayer would not be properly
reflected.
S 93. Intentionally omitted.
S 94. Subclauses (III) and (IV) of clause (ii) of subparagraph (B) of
paragraph 14 of subdivision (b) of section 1503 of the tax law, as
amended by section 8 of part E of chapter 59 of the laws of 2013, are
amended to read as follows:
(III) [The adjustment required in this paragraph shall not apply if
the taxpayer establishes, by clear and convincing evidence of the type
and in the form specified by the commissioner, that: (a) the royalty
payment was paid, accrued or incurred to a related member organized
under the laws of a country other than the United States; (b) the
related member's income from the transaction was subject to a comprehen-
sive income tax treaty between such country and the United States; (c)
the related member was subject to tax in a foreign nation on a tax base
that included the royalty payment paid, accrued or incurred by the
taxpayer; (d) the related member's income from the transaction was taxed
in such country at an effective rate of tax at least equal to that
imposed by this state; and (e) the royalty payment was paid, accrued or
incurred pursuant to a transaction that was undertaken for a valid busi-
ness purpose and using terms that reflect an arm's length relationship.
(IV)] The adjustment required in this paragraph shall not apply if the
taxpayer and the commissioner agree in writing to the application or use
of alternative adjustments or computations. The commissioner may, in his
or her discretion, agree to the application or use of alternative
adjustments or computations when he or she concludes that in the absence
of such agreement the income of the taxpayer would not be properly
reflected.
S 95. Clauses (iii) and (iv) of subparagraph (B) of paragraph 2 of
subdivision (e) of section 11-506 of the administrative code of the city
of New York, as amended by section 9 of part E of chapter 59 of the laws
of 2013, are amended to read as follows:
(iii) [The adjustment required in this subdivision shall not apply if
the taxpayer establishes, by clear and convincing evidence of the type
and in the form specified by the commissioner of finance, that: (I) the
royalty payment was paid, accrued or incurred to a related member organ-
ized under the laws of a country other than the United States; (II) the
related member's income from the transaction was subject to a comprehen-
sive income tax treaty between such country and the United States; (III)
the related member was subject to tax in a foreign nation on a tax base
that included the royalty payment paid, accrued or incurred by the
taxpayer; (IV) the related member's income from the transaction was
taxed in such country at an effective rate of tax at least equal to that
imposed by this city; and (V) the royalty payment was paid, accrued or
incurred pursuant to a transaction that was undertaken for a valid busi-
ness purpose and using terms that reflect an arm's length relationship.
(iv)] The adjustment required in this subdivision shall not apply if
the taxpayer and the commissioner of finance agree in writing to the
application or use of alternative adjustments or computations. The
S. 6359 156 A. 8559
commissioner of finance may, in his or her discretion, agree to the
application or use of alternative adjustments or computations when he or
she concludes that in the absence of such agreement the income of the
taxpayer would not be properly reflected.
S 96. Subclauses (iii) and (iv) of clause (B) of subparagraph 2 of
paragraph (n) of subdivision 8 of section 11-602 of the administrative
code of the city of New York, as amended by section 10 of part E of
chapter 59 of the laws of 2013, are amended to read as follows:
(iii) [The adjustment required in this paragraph shall not apply if
the taxpayer establishes, by clear and convincing evidence of the type
and in the form specified by the commissioner of finance, that: (I) the
royalty payment was paid, accrued or incurred to a related member organ-
ized under the laws of a country other than the United States; (II) the
related member's income from the transaction was subject to a comprehen-
sive income tax treaty between such country and the United States; (III)
the related member was subject to tax in a foreign nation on a tax base
that included the royalty payment paid, accrued or incurred by the
taxpayer; (IV) the related member's income from the transaction was
taxed in such country at an effective rate of tax at least equal to that
imposed by this city; and (V) the royalty payment was paid, accrued or
incurred pursuant to a transaction that was undertaken for a valid busi-
ness purpose and using terms that reflect an arm's length relationship.
(iv)] The adjustment required in this paragraph shall not apply if the
taxpayer and the commissioner of finance agree in writing to the appli-
cation or use of alternative adjustments or computations. The commis-
sioner of finance may, in his or her discretion, agree to the applica-
tion or use of alternative adjustments or computations when he or she
concludes that in the absence of such agreement the income of the
taxpayer would not be properly reflected.
S 97. Clauses (iii) and (iv) of subparagraph (B) of paragraph 2 of
subdivision (q) of section 11-641 of the administrative code of the city
of New York, as amended by section 11 of part E of chapter 59 of the
laws of 2013, are amended to read as follows:
(iii) [The adjustment required in this subdivision shall not apply if
the taxpayer establishes, by clear and convincing evidence of the type
and in the form specified by the commissioner of finance, that: (I) the
royalty payment was paid, accrued or incurred to a related member organ-
ized under the laws of a country other than the United States; (II) the
related member's income from the transaction was subject to a comprehen-
sive income tax treaty between such country and the United States; (III)
the related member was subject to tax in a foreign nation on a tax base
that included the royalty payment paid, accrued or incurred by the
taxpayer; (IV) the related member's income from the transaction was
taxed in such country at an effective rate of tax at least equal to that
imposed by this city; and (V) the royalty payment was paid, accrued or
incurred pursuant to a transaction that was undertaken for a valid busi-
ness purpose and using terms that reflect an arm's length relationship.
(iv)] The adjustment required in this subdivision shall not apply if
the taxpayer and the commissioner of finance agree in writing to the
application or use of alternative adjustments or computations. The
commissioner of finance may, in his or her discretion, agree to the
application or use of alternative adjustments or computations when he or
she concludes that in the absence of such agreement the income of the
taxpayer would not be properly reflected.
S 98. Clauses (iii) and (iv) of subparagraph (B) of paragraph 2 of
subdivision (t) of section 11-1712 of the administrative code of the
S. 6359 157 A. 8559
city of New York, as amended by section 12 of part E of chapter 59 of
the laws of 2013, are amended to read as follows:
(iii) [The adjustment required in this subdivision shall not apply if
the taxpayer establishes, by clear and convincing evidence of the type
and in the form specified by the commissioner of finance, that: (I) the
royalty payment was paid, accrued or incurred to a related member organ-
ized under the laws of a country other than the United States; (II) the
related member's income from the transaction was subject to a comprehen-
sive income tax treaty between such country and the United States; (III)
the related member was subject to tax in a foreign nation on a tax base
that included the royalty payment paid, accrued or incurred by the
taxpayer; (IV) the related member's income from the transaction was
taxed in such country at an effective rate of tax at least equal to that
imposed by this city; and (V) the royalty payment was paid, accrued or
incurred pursuant to a transaction that was undertaken for a valid busi-
ness purpose and using terms that reflect an arm's length relationship.
(iv)] The adjustment required in this subdivision shall not apply if
the taxpayer and the commissioner of finance agree in writing to the
application or use of alternative adjustments or computations. The
commissioner of finance may, in his or her discretion, agree to the
application or use of alternative adjustments or computations when he or
she concludes that in the absence of such agreement the income of the
taxpayer would not be properly reflected.
S 99. Notwithstanding any provisions of law to the contrary and
notwithstanding the repeal of article 32 of the tax law by section one
of this act, the repeal of section 180 of the tax law by section two of
this act and the repeal of section 181 of the tax law by section three
of this act, all provisions of such article and such sections, in
respect to the imposition, exemption, assessment, payment, payment over,
determination, collection, and credit or refund of tax, interest and
penalty imposed thereunder, the filing of forms and returns, the preser-
vation of records for the purposes of such tax, the secrecy of returns,
the disposition of revenues, and the civil and criminal penalties appli-
cable to the violation of the provisions of such article 32 and such
sections 180 and 181, shall continue in full force and effect with
respect to all such tax accrued for taxable years beginning before Janu-
ary 1, 2015; and all actions and proceedings, civil or criminal,
commenced or authorized to be commenced under or by virtue of any
provision of such article 32 or by virtue of any provision of such
section 180 or 181 so repealed, and pending or able to be commenced
immediately prior to the taking effect of such repeal, may be commenced,
prosecuted and defended to final effect in the same manner as they might
if such provisions were not so repealed.
S 100. Subdivision 1 of section 187 of the tax law, as amended by
chapter 2 of the laws of 1995, is amended to read as follows:
1. A taxpayer shall be allowed a credit, to be credited against the
taxes imposed by this article, other than the taxes and fees imposed by
sections [one hundred eighty, one hundred eighty-one,] one hundred
eighty-six-a and one hundred eighty-six-e of this chapter. The amount of
the credit shall be the amount of the special additional mortgage
recording tax paid by the taxpayer pursuant to the provisions of subdi-
vision one-a of section two hundred fifty-three of this chapter on mort-
gages recorded on and after January first, nineteen hundred seventy-
nine. Provided, however, that the amount of such credit allowable
against the tax imposed by section one hundred eighty-four of this chap-
ter shall be the excess of the amount of such special additional mort-
S. 6359 158 A. 8559
gage recording tax paid over the amount of any credit allowed by this
section against the tax imposed by section one hundred eighty-three of
this chapter. 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 one
or more of the counties comprising the metropolitan commuter transporta-
tion 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.
S 101. Subdivision 1 of section 187-a of the tax law, as added by
chapter 142 of the laws of 1997, is amended to read as follows:
1. Allowance of credit. A taxpayer shall be allowed a credit, to be
computed as hereinafter provided, against the taxes imposed by this
article, other than the taxes imposed by sections [one hundred eighty,
one hundred eighty-one,] one hundred eighty-six-a, one hundred eighty-
six-e and one hundred eighty-nine of this article, for employing within
the state a qualified employee. Provided, however, the amount of credit
allowed by this section against the tax imposed by section one hundred
eighty-four of this article shall be the excess of the credit computed
under this section over the amount of credit allowed by this section
against the tax imposed by section one hundred eighty-three of this
article.
S 102. Subdivision 1 of section 190 of the tax law, as amended by
section 17 of part B of chapter 58 of the laws of 2004, is amended to
read as follows:
1. General. A taxpayer shall be allowed a credit against the tax
imposed by this article[, other than the taxes and fees imposed by
sections one hundred eighty and one hundred eighty-one of 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.
S 103. Subdivision 5 of section 192 of the tax law is REPEALED.
S 104. Clauses 1 and 2 of subparagraph (A) and subparagraph (B) of
paragraph (iii) of subdivision 9 of section 16-v of section 1 of chapter
174 of the laws of 1968 constituting the urban development corporation
act, as added by section 1 of part C of chapter 59 of the laws of 2013,
is amended to read as follows:
(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 the following provisions of the tax law: article
nine-A; section one hundred eighty-three, OR one hundred eighty-four [or
one hundred eighty-five] of article nine; [article thirty-two] or arti-
cle thirty-three; or
(2) is substantially similar in operation and in ownership to a busi-
ness entity (or entities) taxable or previously taxable under the
S. 6359 159 A. 8559
following provisions of the tax law: article nine-A; section one hundred
eighty-three, one hundred eighty-four, FORMER SECTION one hundred eight-
y-five or former section one hundred eighty-six of article nine; FORMER
article thirty-two; article thirty-three; article twenty-three, or would
have been subject to tax under such article twenty-three (as such arti-
cle was in effect on January first, nineteen hundred eighty) or the
income (or losses) of which is (or was) includable under article twen-
ty-two; or
(B) a sole proprietorship, partnership, limited partnership, limited
liability company, or New York subchapter S corporation that is not
substantially similar in operation and in ownership to a business entity
(or entities) taxable, or previously taxable, under article nine-A of
the tax law, section one hundred eighty-three, one hundred eighty-four,
FORMER SECTION one hundred eighty-five or former section one hundred
eighty-six of article nine of the tax law, FORMER article thirty-two or
ARTICLE thirty-three of the tax law, article twenty-three of the tax law
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 the tax law; and
S 105. Section 206 of the tax law, as added by chapter 69 of the laws
of 1978, is amended to read as follows:
S 206. Deposit and disposition of revenue. The [license fees,]
taxes, percentage, interest and other charges imposed by this article
shall be collected and deposited and receipts therefor issued by the
[tax commission, except that such license fees, taxes, percentage,
interest and other charges imposed by section one hundred eighty of this
chapter shall be collected and deposited and receipts therefor issued by
the proper state officer in accordance with the provisions of subdivi-
sion two of section one hundred eighty of this chapter,] COMMISSIONER
and all revenues so collected or received shall be deposited and
disposed of pursuant to the provisions of section one hundred seventy-
one-a of this chapter.
S 106. Subsection (a) of section 1080 of the tax law, as added by
chapter 188 of the laws of 1964, is amended to read as follows:
(a) General.--- The provisions of this article shall apply to the
administration of and the procedures with respect to the taxes imposed
by articles nine [(except section one hundred eighty)], AND nine-a[,
nine-b and nine-c] of this chapter for taxable years or periods ending
on or after December thirty-first, nineteen hundred sixty-four.
S 107. Subdivisions (a) and (c) of section 1809 of the tax law, as
added by section 1 of subpart A of part S of chapter 57 of the laws of
2010, are amended to read as follows:
(a) Any person who, with intent to evade payment of any tax imposed
under article nine [(other than under section one hundred eighty or one
hundred eighty-one)], nine-A, thirteen, [thirty-two,] thirty-three or
thirty-three-A of this chapter, fails to file a return or report for
three consecutive taxable years shall be guilty of a class E felony,
provided that such person had an unpaid tax liability, in excess of the
threshold amount with respect to each of the three consecutive taxable
years. The threshold amount in the case of a taxable year under article
nine-A of this chapter ending after June thirtieth, nineteen hundred
eighty-nine is the applicable fixed dollar minimum prescribed under
paragraph (d) of subdivision one of section two hundred ten of this
chapter. In the event such fixed dollar minimum is less than two hundred
fifty dollars, the threshold amount in the case of such taxable year is
S. 6359 160 A. 8559
two hundred fifty dollars. In all other cases the threshold amount is
two hundred fifty dollars.
(c) As used in this section, the terms "return" and "report" shall
mean a return or report required under section one hundred ninety-two,
two hundred eleven, two hundred ninety-four, [fourteen hundred sixty-
two,] fifteen hundred fifteen or fifteen hundred fifty-four of this
chapter. It shall not include any return or report referred to in
section one hundred ninety-seven-a, two hundred thirteen-a, [fourteen
hundred sixty] or fifteen hundred thirteen of this chapter.
S 108. Paragraphs (d), (e), (g), (h) and (q) of section 104-A of the
business corporation law, subdivisions (d), (e) and (q) as amended by
chapter 166 of the laws of 1991, subdivision (g) as added by chapter 591
of the laws of 1982, and subdivision (h) as amended by chapter 117 of
the laws of 1986, are amended to read as follows:
(d) For filing a certificate of incorporation pursuant to section four
hundred two of this chapter, one hundred twenty-five dollars [plus the
tax on shares prescribed by section one hundred eighty of the tax law].
(e) For filing a certificate of amendment pursuant to section eight
hundred five of this chapter, sixty dollars [plus the tax on shares
prescribed by section one hundred eighty of the tax law if such certif-
icate shows a change of shares].
(g) For filing a restated certificate of incorporation pursuant to
section eight hundred seven of this chapter, sixty dollars [plus the tax
on shares prescribed by section one hundred eighty of the tax law if
such certificate shows a change of shares].
(h) For filing a certificate of merger or consolidation pursuant to
section nine hundred four of this chapter, or a certificate of exchange
pursuant to section nine hundred thirteen (other than paragraph (g) of
section nine hundred thirteen) of this chapter, sixty dollars [plus the
tax on shares prescribed by section one hundred eighty of the tax law if
such certificate shows a change of shares].
(q) For filing a certificate of incorporation by a professional
service corporation pursuant to section fifteen hundred three of this
chapter, one hundred twenty-five dollars [plus the tax on shares
prescribed by section one hundred eighty of the tax law].
S 109. Subdivision 8 of section 7-a of the general associations law,
as added by chapter 575 of the laws of 1964, is amended to read as
follows:
8. The provisions of section ninety-six of the executive law prescrib-
ing the fee to be collected by the department of state for filing a
certificate of incorporation under the business corporation law shall
apply to the certificate of incorporation to be filed pursuant to this
section[, and the organization tax payable under section one hundred
eighty of the tax law in respect of a corporation formed under the busi-
ness corporation law shall be paid before the department of state shall
file such certificate of incorporation].
S 110. Severability. If any provision of this act shall for any reason
be finally adjudged by any court of competent jurisdiction to be inval-
id, such judgment shall not affect, impair, or invalidate the remainder
of this act, but shall be confined in its operation to the provision
directly involved in the controversy in which such judgment shall have
been rendered. It is hereby declared to be in the intent of the legisla-
ture that this act would have been enacted even if such invalid
provision had not been included in this act. Provided further, if a
court of final, competent jurisdiction adjudges the tax rates imposed on
qualified New York manufacturers to be invalid, qualified New York
S. 6359 161 A. 8559
manufacturers shall be subject to the same tax rates as all other
taxpayers subject to tax under article 9-A of the tax law. Provided
further, if a court of final, competent jurisdiction adjudges that any
of the tax credits provided by this act to be invalid, such credit or
credits shall be deemed repealed and shall be of no force and effect as
to any taxpayers.
S 111. This act shall take effect January 1, 2015 and shall apply to
taxable years commencing on or after such date; provided that the amend-
ments to section 25 of the tax law made by section forty-three of this
act shall not affect the repeal of such section and shall be deemed
repealed therewith; provided, further, that the amendments to the open-
ing paragraph of subdivision (a), subparagraph (C) of paragraph 2 of
subdivision (e) and subdivision (f) of section 35 of the tax law made by
section fifty of this act shall not affect the repeal of such provisions
and shall be deemed repealed therewith; provided, further, that the
amendments to clause (xxxii) of subparagraph (B) of paragraph 1 of
subsection (i) of section 606 of the tax law made by section sixty-eight
of this act shall not affect the repeal of such clause and shall be
deemed repealed therewith; provided, further, that the amendments to
clause (xxxiii) of subparagraph (B) of paragraph 1 of subsection (i) of
section 606 of the tax law made by section sixty-eight of this act shall
not affect the repeal of such clause and shall be deemed repealed there-
with; and provided, further, that the amendments to clause (ii) of
subparagraph (B) of paragraph 2 of subsection (q), paragraph 3 of
subsection (s) and the closing paragraph of paragraph 1 of subsection
(t) of section 1085 of the tax law made by section eighty-one of this
act shall not affect the repeal of such provisions and shall be deemed
repealed therewith.
PART B
Section 1. Subparagraph (iii) of paragraph (a) of subdivision 14 of
section 425 of the real property tax law, as added by section 1 of part
J of chapter 57 of the laws of 2013, is amended to read as follows:
(iii) An owner who fails to register by the registration deadline so
established shall be permitted to file a petition with the commissioner
requesting that the commissioner excuse such failure and accept a late
registration, provided that such petition shall explain why such failure
occurred and shall be filed no later than one year after such deadline,
AND PROVIDED FURTHER THAT IF THE COMMISSIONER ACCEPTS A LATE REGISTRA-
TION AFTER HAVING DIRECTED THE REMOVAL OF THE BASIC STAR EXEMPTION FROM
THE PROPERTY TO WHICH THE REGISTRATION PERTAINS, THEN IN LIEU OF DIRECT-
ING THE EXEMPTION TO BE RESTORED, THE COMMISSIONER IS AUTHORIZED IN HIS
OR HER DISCRETION TO REMIT DIRECTLY TO THE PROPERTY OWNER OR OWNERS THE
TAX SAVINGS THAT THE EXEMPTION WOULD HAVE YIELDED HAD IT NOT BEEN
REMOVED, AND TO FURTHER DIRECT THE ASSESSOR TO RESTORE THE EXEMPTION ON
A PROSPECTIVE BASIS WITHOUT A NEW APPLICATION UNLESS THE ASSESSOR HAS
REASON TO BELIEVE THAT THE PROPERTY OWNER IS NO LONGER ELIGIBLE FOR
REASONS OTHER THAN A FAILURE TO REGISTER;
S 2. This act shall take effect immediately and shall be deemed to
have been in full force and effect on and after April 1, 2014.
PART C
Section 1. Section 2 of chapter 540 of the laws of 1992, amending the
real property tax law relating to oil and gas charges, as amended by
S. 6359 162 A. 8559
section 1 of part A of chapter 59 of the laws of 2012, is amended to
read as follows:
S 2. This act shall take effect immediately and shall be deemed to
have been in full force and effect on and after April 1, 1992; provided,
however that any charges imposed by section 593 of the real property tax
law as added by section one of this act shall first be due for values
for assessment rolls with tentative completion dates after July 1, 1992,
and provided further, that this act shall remain in full force and
effect until March 31, [2015] 2018, at which time section 593 of the
real property tax law as added by section one of this act shall be
repealed.
S 2. This act shall take effect immediately.
PART D
Section 1. Subdivision 1 of section 236 of the racing, pari-mutuel
wagering and breeding law, as amended by chapter 18 of the laws of 2008,
is amended to read as follows:
1. Every corporation authorized under this chapter to conduct pari-mu-
tuel betting at a race meeting on races run thereat, except as provided
in section two hundred thirty-eight of this article with respect to the
franchised corporation, shall distribute all sums deposited in any pari-
mutuel pool to the holders of winning tickets therein, providing such
tickets be presented for payment before April first of the year follow-
ing the year of their purchase, less an amount which shall be estab-
lished and retained by such racing corporation of between fourteen to
twenty per centum of the total deposits in pools resulting from regular
on-track bets and less sixteen to twenty-two per centum of the total
deposits in pools resulting from multiple on-track bets and less twenty
to thirty per centum of the total deposits in pools resulting from exot-
ic on-track bets and less twenty to thirty-six per centum of the total
pools resulting from super exotic on-track bets, plus the breaks. The
retention rate to be established is subject to the prior approval of the
[racing and wagering board] COMMISSION. Such rate may not be changed
more than once per calendar quarter to be effective on the first day of
the calendar quarter. "Exotic bets" and "multiple bets" shall have the
meanings set forth in section five hundred nineteen of this chapter and
breaks are hereby defined as the odd cents over any multiple of ten, or
for exotic bets over any multiple of fifty, or for super exotic bets,
over any multiple of one hundred, calculated on the basis of one dollar,
otherwise payable to a patron provided, however, that effective after
October fifteenth, nineteen hundred ninety-four breaks are hereby
defined as the odd cents over any multiple of five for payoffs greater
than one dollar five cents but less than five dollars, over any multiple
of ten for payoffs greater than five dollars but less than twenty-five
dollars, over any multiple of twenty-five for payoffs greater than twen-
ty-five dollars but less than two hundred fifty dollars, or over any
multiple of fifty for payoffs over two hundred fifty dollars. "Super
exotic bets" shall have the meaning set forth in section three hundred
one of this chapter. Of the amount so retained there shall be paid by
such corporation to the department of taxation and finance as a reason-
able tax by the state for the privilege of conducting pari-mutuel
betting on the races run at the race meeting held by such corporation,
which tax is hereby levied, the following percentages of the total pool,
plus fifty-five per centum of the breaks; the applicable rates for regu-
lar and multiple bets shall be one and one-half per centum; the applica-
S. 6359 163 A. 8559
ble rates for exotic bets shall be six and three-quarter per centum and
the applicable rate for super exotic bets shall be seven and three-quar-
ter per centum. Effective on and after September first, nineteen hundred
ninety-four, the applicable tax rate shall be one per centum of all
wagers, provided that, an amount equal to one-half the difference
between the taxation rate for on-track regular, multiple and exotic bets
as of December thirty-first, nineteen hundred ninety-three and the rates
on such on-track wagers as herein provided shall be used exclusively for
purses. Provided, however, that for any twelve-month period beginning on
April first in nineteen hundred ninety and any year thereafter, each of
the applicable rates set forth above shall be increased by one-quarter
of one per centum on all on-track bets of any such racing corporation
that did not expend an amount equal to at least one-half of one per
centum of its on-track bets during the immediately preceding calendar
year for enhancements consisting of capital improvements as defined by
section two hundred thirty-seven of this article, repairs to its phys-
ical plant, structures, and equipment used in its racing or wagering
operations as certified by the [state racing and wagering board] COMMIS-
SION to the commissioner of taxation and finance no later than eighty
days after the close of such calendar year, and five special events at
each track in each calendar year, not otherwise conducted in the ordi-
nary course of business, the purpose of which shall be to encourage,
attract and promote track attendance and encourage new and continued
patronage, which events shall be approved by the [racing and wagering
board] COMMISSION for purposes of this subdivision. In the determination
of the amounts expended for such enhancements, the [board] COMMISSION
may consider the immediately preceding twelve month calendar period or
the average of the two immediately preceding twelve month calendar peri-
ods. Provided further, however, that of the portion of the increased
amounts retained by such corporation above those amounts retained in
nineteen hundred eighty-four, an amount of such increase shall be
distributed to purses in the same proportion as commissions and purses
were distributed during nineteen hundred eighty-four as certified by the
[board] COMMISSION. Such corporation in the second zone shall receive a
credit against the daily tax imposed by this subdivision in an amount
equal to one per centum of total daily pools resulting from the simul-
cast of such corporation's races to licensed facilities operated by
regional off-track betting corporations in accordance with section one
thousand eight of this chapter, provided however, that sixty per centum
of the amount of such credit shall be used exclusively to increase purs-
es for overnight races conducted by such corporation; and, provided
further, that in no event shall such total daily credit exceed one per
centum of the total daily pool of such corporation. Provided, however,
that on and after September first, nineteen hundred ninety-four such
credit shall be four-tenths percent of total daily pools resulting from
such simulcasting and that in no event shall such total daily credit
equal four-tenths percent of the total daily pool of such corporation.
Such corporation shall pay to the New York state thoroughbred breeding
and development fund one-half of one per centum of the total daily
on-track pari-mutuel pools from regular, multiple and exotic bets, and
three per centum of super exotic bets. The corporation shall receive
credit as a reduction of the tax by the state for the privilege of
conducting pari-mutuel betting for the amounts, except amounts paid from
super exotic betting pools, paid to the New York state thoroughbred
breeding and development fund after January first, nineteen hundred
seventy-eight.
S. 6359 164 A. 8559
Such corporation shall distribute to purses an amount equal to fifty
per centum of any compensation it receives from simulcasting or from
wagering conducted outside the United States. Such corporation shall pay
to the [racing and wagering board] COMMISSION as a regulatory fee, which
fee is hereby levied, [fifty] SIXTY hundredths of one per centum of the
total daily on-track pari-mutuel pools of such corporation.
S 2. Paragraph (d) of subdivision 1 of section 238 of the racing,
pari-mutuel wagering and breeding law, as amended by chapter 18 of the
laws of 2008, is amended to read as follows:
(d) The pari-mutuel tax rate authorized by paragraph (a) of this
subdivision shall be effective so long as a franchised corporation noti-
fies the [racing and wagering board] COMMISSION by August fifteenth of
each year that such pari-mutuel tax rate is effective of its intent to
conduct a race meeting at Aqueduct racetrack during the months of Decem-
ber, January, February, March and April. For purposes of this paragraph
such race meeting shall consist of not less than ninety-five days of
racing. Not later than May first of each year that such pari-mutuel tax
rate is effective, the [racing and wagering board] COMMISSION shall
determine whether a race meeting at Aqueduct racetrack consisted of the
number of days as required by this paragraph. In determining the number
of race days, cancellation of a race day because of an act of God, which
the [racing and wagering board] COMMISSION approves or because of weath-
er conditions that are unsafe or hazardous which the [racing and wager-
ing board] COMMISSION approves shall not be construed as a failure to
conduct a race day. Additionally, cancellation of a race day because of
circumstances beyond the control of such franchised corporation for
which the [racing and wagering board] COMMISSION gives approval shall
not be construed as a failure to conduct a race day. If the [racing and
wagering board] COMMISSION determines that the number of days of racing
as required by this paragraph have not occurred then the pari-mutuel tax
rate in paragraph (a) of this subdivision shall revert to the pari-mutu-
el tax rates in effect prior to January first, nineteen hundred ninety-
five. Such franchised corporation shall pay to the [racing and wagering
board] COMMISSION as a regulatory fee, which fee is hereby levied,
[fifty] SIXTY hundredths of one per centum of the total daily on-track
pari-mutuel pools of such franchised corporation.
S 3. Paragraph d of subdivision 1 of section 318 of the racing, pari-
mutuel wagering and breeding law, as amended by section 3 of part B of
chapter 59 of the laws of 2005, is amended to read as follows:
d. Every harness racing association or corporation shall pay to the
[board] COMMISSION as a regulatory fee, which fee is hereby levied,
[fifty] SIXTY hundredths of one percent of the total daily on-track
pari-mutuel pools of such association or corporation.
S 4. The opening paragraph of subdivision 1 of section 527 of the
racing, pari-mutuel wagering and breeding law, as amended by chapter 18
of the laws of 2008, is amended to read as follows:
The disposition of the retained commission from pools resulting from
regular, multiple or exotic bets, as the case may be, whether placed on
races run within a region or outside a region, conducted by racing
corporations, harness racing associations or corporations, quarter horse
racing associations or corporations or races run outside the state shall
be governed by the tables in paragraphs a and b of this subdivision. The
rate denominated "state tax" shall represent the rate of a reasonable
tax imposed upon the retained commission for the privilege of conducting
off-track pari-mutuel betting, which tax is hereby levied and shall be
payable in the manner set forth in this section. Each off-track betting
S. 6359 165 A. 8559
corporation shall pay to the [racing and wagering board] COMMISSION as a
regulatory fee, which fee is hereby levied, [fifty] SIXTY hundredths of
one percent of the total daily pools of such corporation. Each corpo-
ration shall also pay twenty per centum of the breaks derived from bets
on harness races and fifty per centum of the breaks derived from bets on
all other races to the agriculture and New York State horse breeding and
development fund and to the thoroughbred breeding and development fund,
the total of such payments to be apportioned fifty per centum to each
such fund. For the purposes of this section, the New York city, Suffolk,
Nassau, and the Catskill regions shall constitute a single region and
any thoroughbred track located within the Capital District region shall
be deemed to be within such single region. A "regional meeting" shall
refer to either harness or thoroughbred meetings, or both, except that a
franchised corporation shall not be a regional track for the purpose of
receiving distributions from bets on thoroughbred races conducted by a
thoroughbred track in the Catskill region conducting a mixed meeting.
With the exception of a harness racing association or corporation first
licensed to conduct pari-mutuel wagering at a track located in Tioga
county after January first, two thousand five, racing corporations first
licensed to conduct pari-mutuel racing after January first, nineteen
hundred eighty-six or a harness racing association or corporation first
licensed to conduct pari-mutuel wagering at a track located in Genesee
County after January first, two thousand five, and quarter horse tracks
shall not be "regional tracks"; if there is more than one harness track
within a region, such tracks shall evenly divide payments made pursuant
to the tables in paragraphs a and b of this subdivision when neither
track is running. In the event a track elects to reduce its retained
percentage from any or all of its pari-mutuel pools, the payments to the
track holding the race and the regional track required by paragraphs a
and b of this subdivision shall be reduced in proportion to such
reduction. Nothing in this section shall be construed to authorize the
conduct of off-track betting contrary to the provisions of section five
hundred twenty-three of this article.
S 5. Paragraph a of subdivision 1 of section 904 of the racing, pari-
mutuel wagering and breeding law, as amended by chapter 18 of the laws
of 2008, is amended to read as follows:
a. The applicable state tax provided for in paragraphs a and b of
subdivision one of section five hundred twenty-seven of this chapter
shall be one-half per centum for regular, multiple and exotic bets. Any
harness racing or association or corporation, or thoroughbred racing
corporation authorized pursuant to this section shall pay to the [racing
and wagering board] COMMISSION as a regulatory fee, which fee is hereby
levied, [fifty] SIXTY hundredths of one percent of the total daily pari-
mutuel pools.
S 6. Paragraph g of subdivision 3 of section 1007 of the racing, pari-
mutuel wagering and breeding law, as amended by chapter 18 of the laws
of 2008, is amended to read as follows:
g. Any harness racing or association or corporation, or thoroughbred
racing corporation authorized pursuant to this section shall pay to the
[racing and wagering board] COMMISSION as a regulatory fee, which fee is
hereby levied, [fifty] SIXTY hundredths of one percent of the total
daily pari-mutuel pools.
S 7. Paragraph b of subdivision 3 of section 1008 of the racing, pari-
mutuel wagering and breeding law, as amended by section 7 of part B of
chapter 59 of the laws of 2005, is amended to read as follows:
S. 6359 166 A. 8559
b. Of the sums received by the sending track, fifty percent shall be
distributed to purses in addition to moneys distributed pursuant to
section five hundred twenty-seven of this chapter. The off-track betting
corporation shall pay to the [racing and wagering board] COMMISSION as a
regulatory fee, which fee is hereby levied, [fifty] SIXTY hundredths of
one percent of the total daily pools.
S 8. Paragraph d of subdivision 4 of section 1009 of the racing, pari-
mutuel wagering and breeding law, as amended by section 8 of part B of
chapter 59 of the laws of 2005, is amended to read as follows:
d. The operator shall pay to the [racing and wagering board] COMMIS-
SION as a regulatory fee, which fee is hereby levied, [fifty] SIXTY
hundredths of one percent of the total daily pools.
S 9. Subparagraph (iv) of paragraph i of subdivision 1 of section 1014
of the racing, pari-mutuel wagering and breeding law, as amended by
chapter 18 of the laws of 2008, is amended to read as follows:
(iv) Any thoroughbred racing corporation or harness racing association
or corporation or off-track betting corporation authorized pursuant to
this section shall pay to the [racing and wagering board] COMMISSION as
a regulatory fee, which fee is hereby levied, [fifty] SIXTY hundredths
of one percent of all wagering pools.
S 10. Paragraph e of subdivision 3 of section 1015 of the racing,
pari-mutuel wagering and breeding law, as amended by chapter 18 of the
laws of 2008, is amended to read as follows:
e. Any thoroughbred racing corporation or harness racing association
or corporation or off-track betting corporation authorized pursuant to
this section shall pay to the [racing and wagering board] COMMISSION as
a regulatory fee, which fee is hereby levied, [fifty] SIXTY hundredths
of one percent of all wagering pools.
S 11. Clause (B) of subparagraph 2 of paragraph b of subdivision 1 of
section 1016 of the racing, pari-mutuel wagering and breeding law, as
amended by chapter 18 of the laws of 2008, is amended to read as
follows:
(B) Any harness racing or association or corporation or thoroughbred
racing corporation authorized pursuant to this section shall pay to the
[racing and wagering board] COMMISSION as a regulatory fee, which fee is
hereby levied, [fifty] SIXTY hundredths of one percent of the total
daily pari-mutuel pools.
S 12. Paragraph b of subdivision 2 of section 1018 of the racing,
pari-mutuel wagering and breeding law, as amended by chapter 18 of the
laws of 2008, is amended to read as follows:
b. Any thoroughbred racing corporation or harness racing association
or corporation or off-track betting corporation shall pay to the [racing
and wagering board] COMMISSION as a regulatory fee, which fee is hereby
levied, [fifty] SIXTY hundredths of one percent of all wagering pools.
S 13. This act shall take effect immediately.
PART E
Section 1. Subsection (a) of section 653 of the tax law, as amended by
chapter 65 of the laws of 1985, is amended to read as follows:
(a) General. (1) Any return, statement or other document required to
be made pursuant to this article shall be signed in accordance with
regulations or instructions prescribed by the [tax commission] COMMIS-
SIONER. The fact that an individual's name is signed to a return,
statement, or other document, shall be prima facie evidence for all
S. 6359 167 A. 8559
purposes that the return, statement or other document was actually
signed by him OR HER.
(2) IN THE CASE OF AN ELECTRONICALLY FILED INDIVIDUAL'S PERSONAL
INCOME TAX RETURN PREPARED BY A TAX PREPARER, AN AUTHORIZATION TO FILE
ANY RETURN, STATEMENT OR OTHER DOCUMENT REQUIRED TO BE MADE PURSUANT TO
THIS ARTICLE SIGNED BY THE TAXPAYER IN ACCORDANCE WITH THE REGULATIONS
OR INSTRUCTIONS PRESCRIBED BY THE COMMISSIONER AND RECEIVED ELECTRON-
ICALLY BY THE TAX PREPARER SHALL SATISFY THE SIGNATURE REQUIREMENTS
UNDER THIS ARTICLE.
S 2. This act shall take effect immediately and shall apply to returns
filed for taxable years beginning on or after January 1, 2014.
PART F
Section 1. Clause (C) of subparagraph (i) of paragraph (b) of subdivi-
sion 4 of section 425 of the real property tax law, as amended by
section 3 of part E of chapter 83 of the laws of 2002, is amended to
read as follows:
(C) For final assessment rolls to be completed in [each ensuing year]
THE YEARS TWO THOUSAND FOUR THROUGH TWO THOUSAND FOURTEEN, the applica-
ble income tax year, cost-of-living-adjustment percentage and applicable
increase percentage shall all be advanced by one year, and the income
standard shall be the previously-applicable income standard increased by
the new cost-of-living-adjustment percentage. If there should be a year
for which there is no applicable increase percentage due to a general
benefit increase as defined by subdivision three of subsection (i) of
section four hundred fifteen of title forty-two of the United States
code, the applicable increase percentage for purposes of this computa-
tion shall be deemed to be the percentage which would have yielded that
general benefit increase. FOR FINAL ASSESSMENT ROLLS TO BE COMPLETED IN
TWO THOUSAND FIFTEEN AND THEREAFTER, THE APPLICABLE INCOME TAX YEAR
SHALL BE ADVANCED BY ONE YEAR, AND ELIGIBILITY FOR THE ENHANCED
EXEMPTION SHALL BE BASED UPON THE INCOME STANDARD APPLIED FOR FINAL
ASSESSMENT ROLLS COMPLETED IN TWO THOUSAND FOURTEEN.
S 2. This act shall take effect immediately and shall apply to assess-
ment rolls completed in 2015 and thereafter.
PART G
Section 1. Section 2 of part I of chapter 58 of the laws of 2006,
relating to providing an enhanced earned income tax credit, as amended
by section 1 of part L of chapter 59 of the laws of 2012, is amended to
read as follows:
S 2. This act shall take effect immediately and shall apply to taxable
years beginning on or after January 1, 2006 and before January 1, [2015]
2017.
S 2. This act shall take effect immediately.
PART H
Section 1. The general obligations law is amended by adding a new
section 3-505 to read as follows:
S 3-505. ENFORCEMENT OF DELINQUENT TAX LIABILITIES THROUGH ELECTRONIC
TAX CLEARANCES FOR OCCUPATIONAL, PROFESSIONAL AND BUSINESS LICENSES.
1. AS USED IN THIS SECTION:
S. 6359 168 A. 8559
A. "GOVERNMENT ENTITY" MEANS THE STATE OF NEW YORK, OR ANY OF ITS
AGENCIES, POLITICAL SUBDIVISIONS, INSTRUMENTALITIES, PUBLIC CORPORATIONS
(INCLUDING A PUBLIC CORPORATION CREATED PURSUANT TO AGREEMENT OR COMPACT
WITH ANOTHER STATE OR CANADA), OR COMBINATION THEREOF, RESPONSIBLE FOR
DETERMINING WHETHER A LICENSE SHALL BE ISSUED OR RENEWED.
B. "ELECTRONIC LICENSE APPLICATION" MEANS ANY ELECTRONIC DATA FORM
THAT MUST BE COMPLETED BY AN APPLICANT TO OBTAIN OR RENEW A LICENSE, OR
AN ELECTRONIC DATA PROCESS WHICH IS USED BY A GOVERNMENT ENTITY TO PROC-
ESS DATA RECEIVED FROM AN APPLICANT SEEKING TO RECEIVE OR RENEW A
LICENSE.
C. "ELECTRONIC TAX CLEARANCE" MEANS AN ELECTRONIC COMMUNICATION FROM
THE DEPARTMENT OF TAXATION AND FINANCE INDICATING THAT AN APPLICANT HAD
NO PAST-DUE TAX LIABILITIES, AS THAT TERM IS DEFINED IN SECTION ONE
HUNDRED SEVENTY-ONE-W OF THE TAX LAW, OR THAT NO CONCLUSIVE MATCH COULD
BE MADE.
D. "LICENSE" MEANS ANY CERTIFICATE, LICENSE, PERMIT OR GRANT OF
PERMISSION REQUIRED BY LAW OR AGENCY REGULATION AS A CONDITION FOR THE
LAWFUL PRACTICE OF ANY OCCUPATION, EMPLOYMENT, TRADE, VOCATION, BUSI-
NESS, OR PROFESSION, INCLUDING ANY REGISTRATION REQUIRED BY LAW OR AGEN-
CY REGULATION AS A CONDITION FOR SUCH LAWFUL PRACTICE. THIS SHALL
INCLUDE, BUT IS NOT LIMITED TO, ANY LICENSE GRANTED TO AN INDIVIDUAL OR
ENTITY BY THE STATE EDUCATION DEPARTMENT, THE DEPARTMENT OF STATE, OR
THE OFFICE OF COURT ADMINISTRATION. PROVIDED, HOWEVER, THAT "LICENSE"
SHALL NOT, FOR THE PURPOSES OF THIS SECTION, INCLUDE ANY LICENSE OR
PERMIT TO OWN, POSSESS, CARRY, OR FIRE ANY EXPLOSIVE, PISTOL, HANDGUN,
RIFLE, SHOTGUN, OTHER FIREARM OR AMMUNITION.
2. NOTWITHSTANDING ANY OTHER PROVISION OF LAW, AND WHEN NOT ALREADY
REQUIRED BY ANOTHER PROVISION OF LAW OR REGULATION, ANY GOVERNMENT ENTI-
TY MAY ELECT TO CONDITION THE ISSUANCE OR RENEWAL OF A LICENSE ON THE
ABSENCE OF PAST-DUE TAX LIABILITIES AND TO MAKE SUCH DETERMINATION
THROUGH THE RECEIPT OF AN ELECTRONIC TAX CLEARANCE FROM THE DEPARTMENT
OF TAXATION AND FINANCE AS PROVIDED FOR IN SECTION ONE HUNDRED SEVENTY-
ONE-W OF THE TAX LAW.
3. ANY APPLICANT FOR A LICENSE SUBJECT TO ELECTRONIC TAX CLEARANCE
SHALL BE REQUIRED TO PROVIDE ANY INFORMATION DEEMED NECESSARY BY THE
GOVERNMENT ENTITY AND THE DEPARTMENT OF TAXATION AND FINANCE TO EFFI-
CIENTLY AND ACCURATELY PROVIDE AN ELECTRONIC TAX CLEARANCE, AND THE
FAILURE BY THE APPLICANT TO PROVIDE SUCH INFORMATION SHALL RENDER THE
APPLICATION INCOMPLETE.
4. THE APPLICATION FOR A LICENSE SUBJECT TO ELECTRONIC TAX CLEARANCE,
OR THE INSTRUCTIONS FOR SUCH APPLICATION, SHALL CLEARLY INFORM THE
APPLICANT THAT AN ELECTRONIC TAX CLEARANCE WILL BE PERFORMED AND THAT,
IF THE TAX CLEARANCE IS DENIED, THE APPLICANT MUST CONTACT THE DEPART-
MENT OF TAXATION AND FINANCE TO RESOLVE ANY PAST-DUE TAX LIABILITIES
BEFORE THE APPLICATION FOR A LICENSE OR RENEWAL MAY BE RESUBMITTED.
5. IF AN ELECTRONIC TAX CLEARANCE IS DENIED BY THE DEPARTMENT OF TAXA-
TION AND FINANCE, THE GOVERNMENT ENTITY SHALL DENY ISSUANCE OR RENEWAL
OF THE REQUESTED LICENSE AND SHALL ELECTRONICALLY NOTIFY THE APPLICANT
TO CONTACT THE DEPARTMENT OF TAXATION AND FINANCE TO RESOLVE THE
PAST-DUE TAX LIABILITIES AND THAT NO LICENSE MAY BE ISSUED OR RENEWED
UNTIL THE TAX LIABILITIES ARE RESOLVED.
6. ANY TAX CLEARANCE OR RELATED COMMUNICATIONS SHALL BE BY SECURE
ELECTRONIC COMMUNICATION BETWEEN THE DEPARTMENT OF TAXATION AND FINANCE
AND THE REQUESTING GOVERNMENT ENTITY SUCH THAT PROCESSING OF THE ELEC-
TRONIC APPLICATION IS NOT DELAYED IF THE ELECTRONIC TAX CLEARANCE IS
RECEIVED. NOTWITHSTANDING ANY OTHER LAW TO THE CONTRARY, A GOVERNMENT
S. 6359 169 A. 8559
ENTITY SHALL BE AUTHORIZED TO SHARE ANY APPLICANT DATA OR INFORMATION
WITH THE DEPARTMENT OF TAXATION AND FINANCE THAT IS NECESSARY TO ENSURE
THE PROPER MATCHING OF THE APPLICANT TO THE TAX RECORDS MAINTAINED BY
THE DEPARTMENT OF TAXATION AND FINANCE.
7. NO FEE SHALL BE CHARGED TO THE APPLICANT FOR THE PURPOSES OF
RECEIVING AN ELECTRONIC TAX CLEARANCE.
S 2. The tax law is amended by adding a new section 171-w to read as
follows:
S 171-W. ENFORCEMENT OF DELINQUENT TAX LIABILITIES THROUGH ELECTRONIC
TAX CLEARANCES FOR OCCUPATIONAL, PROFESSIONAL AND BUSINESS LICENSES. 1.
IN ACCORDANCE WITH SECTION 3-505 OF THE GENERAL OBLIGATIONS LAW, THE
COMMISSIONER SHALL COOPERATE WITH ANY GOVERNMENT ENTITY THAT ELECTS TO
REQUIRE AN ELECTRONIC TAX CLEARANCE AS A PART OF AN ELECTRONIC LICENSE
APPLICATION PROCESS FOR WHICH THE GOVERNMENT ENTITY IS RESPONSIBLE. FOR
THE PURPOSES OF THIS SECTION, THE TERM "TAX LIABILITIES" SHALL MEAN ANY
TAX, SURCHARGE, OR FEE ADMINISTERED BY THE COMMISSIONER, OR ANY PENALTY
OR INTEREST OWED BY AN INDIVIDUAL OR ENTITY. THE TERM "PAST-DUE TAX
LIABILITIES" MEANS ANY UNPAID TAX LIABILITIES EQUAL TO OR IN EXCESS OF
FIVE HUNDRED DOLLARS WHICH HAVE BECOME FIXED AND FINAL SUCH THAT THE
TAXPAYER NO LONGER HAS ANY RIGHT TO ADMINISTRATIVE OR JUDICIAL REVIEW.
FOR THE PURPOSES OF THIS SECTION, THE TERMS "GOVERNMENT ENTITY," "ELEC-
TRONIC LICENSE APPLICATION," AND "LICENSE" SHALL HAVE THE SAME MEANING
AS PROVIDED IN SECTION 3-505 OF THE GENERAL OBLIGATIONS LAW.
2. THE COMMISSIONER, OR HIS OR HER DESIGNEE, SHALL COOPERATE WITH ANY
GOVERNMENT ENTITY EXERCISING ITS AUTHORITY PURSUANT TO SECTION 3-505 OF
THE GENERAL OBLIGATIONS LAW TO ESTABLISH PROCEDURES BY WHICH THE DEPART-
MENT SHALL ELECTRONICALLY RECEIVE A TAX CLEARANCE REQUEST AS AN ELEC-
TRONIC LICENSE APPLICATION IS PROCESSED, AND ELECTRONICALLY TRANSMIT
SUCH TAX CLEARANCE TO THE GOVERNMENT ENTITY. THESE PROCEDURES SHALL
INCLUDE THE IDENTIFICATION OF OWNERS, OFFICERS OR RESPONSIBLE PERSONS
SUBJECT TO ELECTRONIC TAX CLEARANCE IN CONJUNCTION WITH AN APPLICATION
BY AN ENTITY, AND ANY OTHER PROCEDURES DEEMED NECESSARY TO CARRY OUT THE
PROVISIONS OF THIS SECTION.
3. IN ANY INSTANCE WHERE A LICENSE OR LICENSE RENEWAL PROVIDED BY THE
GOVERNMENT ENTITY IS OF A TYPE THAT MAY BE ISSUED ONLY TO AN INDIVIDUAL
OR ENTITY THAT IS A PERSON REQUIRED TO REGISTER PURSUANT TO SECTION ONE
THOUSAND ONE HUNDRED THIRTY-FOUR OF THIS CHAPTER, THE DEPARTMENT SHALL
ALSO VERIFY THAT THE APPLICANT IS REGISTERED PURSUANT TO SUCH SECTION,
AND NO ELECTRONIC TAX CLEARANCE MAY BE ISSUED UNLESS THE APPLICANT IS
REGISTERED PURSUANT TO SUCH SECTION.
4. IF A TAX CLEARANCE IS DENIED, THE GOVERNMENT ENTITY PROCESSING THE
APPLICATION SHALL PROVIDE NOTICE TO THE APPLICANT TO CONTACT THE DEPART-
MENT. WHEN THE APPLICANT CONTACTS THE DEPARTMENT, THE DEPARTMENT SHALL
INFORM THE APPLICANT (A) WHAT PAST-DUE TAX LIABILITIES ARE AT ISSUE; (B)
THAT AN ELECTRONIC TAX CLEARANCE MAY BE RECEIVED BY FULLY SATISFYING THE
PAST-DUE TAX LIABILITIES OR BY MAKING PAYMENT ARRANGEMENTS SATISFACTORY
TO THE COMMISSIONER OR, IF THE APPLICANT NEEDS TO REGISTER FOR SALES TAX
PURPOSES, BY REGISTERING PURSUANT TO SECTION ONE THOUSAND ONE HUNDRED
THIRTY-FOUR OF THIS CHAPTER; AND (C) THE GROUNDS FOR CHALLENGING THE
DENIAL OF AN ELECTRONIC TAX CLEARANCE LISTED IN SUBDIVISION FIVE OF THIS
SECTION. THE GOVERNMENT ENTITY SHALL ALSO INFORM THE APPLICANT THAT AN
APPLICATION MAY BE RESUBMITTED AFTER PAYMENT FOR THE PAST-DUE TAX
LIABILITIES HAS CLEARED, OR, IF A PAYMENT PLAN IS AGREED TO, AFTER THE
FIRST PAYMENT PURSUANT TO SUCH PLAN HAS CLEARED.
5. (A) NOTWITHSTANDING ANY OTHER PROVISION OF LAW, AND EXCEPT AS
SPECIFICALLY PROVIDED HEREIN, AN APPLICANT DENIED AN ELECTRONIC TAX
S. 6359 170 A. 8559
CLEARANCE SHALL HAVE NO RIGHT TO COMMENCE A COURT ACTION OR PROCEEDING
OR SEEK ANY OTHER LEGAL RECOURSE AGAINST THE DEPARTMENT OR THE GOVERN-
MENT ENTITY RELATED TO THE DENIAL OF AN ELECTRONIC TAX CLEARANCE BY THE
DEPARTMENT. AN APPLICANT MAY CHALLENGE SUCH DENIAL OF AN ELECTRONIC TAX
CLEARANCE ONLY ON THE GROUNDS THAT:
(I) THE INDIVIDUAL OR ENTITY DENIED THE ELECTRONIC TAX CLEARANCE IS
NOT THE INDIVIDUAL OR ENTITY WITH THE PAST-DUE TAX LIABILITIES AT ISSUE;
(II) THE PAST-DUE TAX LIABILITIES WERE SATISFIED; (III) THE APPLICANT'S
WAGES ARE BEING GARNISHED FOR THE PAYMENT OF CHILD SUPPORT OR COMBINED
CHILD AND SPOUSAL SUPPORT PURSUANT TO AN INCOME EXECUTION ISSUED PURSU-
ANT TO SECTION FIVE THOUSAND TWO HUNDRED FORTY-ONE OR FIVE THOUSAND TWO
HUNDRED FORTY-TWO OF THE CIVIL PRACTICE LAW AND RULES OR ANOTHER STATE'S
INCOME WITHHOLDING ORDER AS AUTHORIZED UNDER PART FIVE OF ARTICLE FIVE-B
OF THE FAMILY COURT ACT, OR GARNISHED BY THE DEPARTMENT FOR THE PAYMENT
OF THE PAST-DUE TAX LIABILITIES AT ISSUE; (IV) THE APPLICANT IS MAKING
CHILD SUPPORT PAYMENTS OR COMBINED CHILD AND SPOUSAL SUPPORT PAYMENTS
PURSUANT TO A SATISFACTORY PAYMENT ARRANGEMENT UNDER SECTION ONE HUNDRED
ELEVEN-B OF THE SOCIAL SERVICES LAW WITH A SUPPORT COLLECTION UNIT OR
OTHERWISE MAKING PERIODIC PAYMENTS IN ACCORDANCE WITH SECTION FOUR
HUNDRED FORTY OF THE FAMILY COURT ACT; OR (V) IF THE ONLY BASIS FOR THE
DENIAL OF AN ELECTRONIC TAX CLEARANCE WAS THE APPLICANT'S FAILURE TO
REGISTER PURSUANT TO SECTION ONE THOUSAND ONE HUNDRED THIRTY-FOUR OF
THIS CHAPTER, THAT THE APPLICANT WAS PROPERLY REGISTERED PURSUANT TO
SUCH SECTION ONE THOUSAND ONE HUNDRED THIRTY-FOUR.
(B) AN APPLICANT SEEKING TO CHALLENGE THE DENIAL OF AN ELECTRONIC TAX
CLEARANCE MUST PROTEST TO THE DEPARTMENT OR THE DIVISION OF TAX APPEALS
NO LATER THAN SIXTY DAYS FROM THE DATE OF THE ELECTRONIC NOTIFICATION TO
THE APPLICANT, PURSUANT TO SUBDIVISION FOUR OF SECTION 3-505 OF THE
GENERAL OBLIGATIONS LAW, THAT THE ELECTRONIC TAX CLEARANCE WAS DENIED.
(C) NOTHING IN THIS SUBDIVISION IS INTENDED TO LIMIT ANY APPLICANT
FROM SEEKING RELIEF FROM JOINT AND SEVERAL LIABILITY PURSUANT TO SECTION
SIX HUNDRED FIFTY-FOUR OF THIS CHAPTER, TO THE EXTENT THAT HE OR SHE IS
ELIGIBLE PURSUANT TO THAT SECTION, OR ESTABLISHING TO THE DEPARTMENT
THAT THE ENFORCEMENT OF THE UNDERLYING TAX LIABILITIES HAS BEEN STAYED
BY THE FILING OF A PETITION PURSUANT TO THE BANKRUPTCY CODE OF 1978
(TITLE ELEVEN OF THE UNITED STATES CODE).
6. NOTWITHSTANDING ANY OTHER PROVISION OF LAW, THE DEPARTMENT MAY
EXCHANGE WITH A GOVERNMENT ENTITY ANY DATA OR INFORMATION NECESSARY
THAT, IN THE DISCRETION OF THE COMMISSIONER, IS NECESSARY FOR THE IMPLE-
MENTATION OF ANY ELECTRONIC TAX CLEARANCE. HOWEVER, NO OTHER AGENCY MAY
RE-DISCLOSE THIS INFORMATION TO ANY OTHER ENTITY OR PERSON, OTHER THAN
FOR THE PURPOSE OF INFORMING THE APPLICANT THAT THE APPLICATION FOR A
LICENSE OR THE RENEWAL OF SUCH LICENSE WILL NOT BE PROCESSED DUE TO THE
LACK OF A REQUIRED TAX CLEARANCE AUTHORIZED BY ANY PROVISION OF LAW
UNLESS OTHERWISE PERMITTED BY LAW.
7. EXCEPT AS OTHERWISE PROVIDED IN THIS SECTION, THE ACTIVITIES TO
COLLECT PAST-DUE TAX LIABILITIES UNDERTAKEN BY THE DEPARTMENT PURSUANT
TO THIS SECTION SHALL NOT IN ANY WAY LIMIT, RESTRICT OR IMPAIR THE
DEPARTMENT FROM EXERCISING ANY OTHER AUTHORITY TO COLLECT OR ENFORCE TAX
LIABILITIES UNDER ANY OTHER APPLICABLE PROVISION OF LAW.
8. EXCEPT AS OTHERWISE PROVIDED IN THIS SECTION, THE PROVISIONS OF
THIS SECTION ARE NOT APPLICABLE TO THE TAX CLEARANCE REQUIRED BY SECTION
ONE HUNDRED SEVENTY-ONE-V OF THIS CHAPTER.
S 3. This act shall take effect June 1, 2014; provided, however, that
the department of taxation and finance and any government entity elect-
ing to receive an electronic tax clearance from the department of taxa-
S. 6359 171 A. 8559
tion and finance may work to execute the necessary procedures and tech-
nical changes to support the electronic tax clearance process as
described in sections one and two of this act before that date;
provided, further, that this effective date will not impact the adminis-
tration of any electronic tax clearance program authorized by another
provision of law.
PART I
Section 1. Subsection (b) of section 612 of the tax law is amended by
adding a new paragraph 40 to read as follows:
(40) IN THE CASE OF A BENEFICIARY OF A NONRESIDENT TRUST OR A TRUST
NOT SUBJECT TO TAX PURSUANT TO SUBPARAGRAPH (D) OF PARAGRAPH THREE OF
SUBSECTION (B) OF SECTION SIX HUNDRED FIVE OF THIS ARTICLE (EXCEPT FOR
AN INCOMPLETE GIFT NON-GRANTOR TRUST, AS DEFINED BY PARAGRAPH FORTY-ONE
OF THIS SUBSECTION), THE AMOUNT OF ANY ACCUMULATION DISTRIBUTION AS
DESCRIBED IN SUBSECTION (B) OF SECTION SIX HUNDRED SIXTY-FIVE OF THE
INTERNAL REVENUE CODE FOR THE TAX YEAR, SUCH AMOUNT TO BE DETERMINED
WITHOUT REGARD TO THE PENULTIMATE SENTENCE OF SUCH SUBSECTION THAT
REFERENCES SECTION SIX HUNDRED SIXTY-SEVEN OF SUCH CODE, AND WITHOUT
REGARD TO SUBSECTION (C) OF SECTION SIX HUNDRED SIXTY-FIVE OF THE INTER-
NAL REVENUE CODE, TO THE EXTENT NOT ALREADY INCLUDED IN FEDERAL GROSS
INCOME FOR THE TAX YEAR.
S 2. Subsection (b) of section 612 of the tax law is amended by adding
a new paragraph 41 to read as follows:
(41) IN THE CASE OF A TAXPAYER WHO TRANSFERRED PROPERTY TO AN INCOM-
PLETE GIFT NON-GRANTOR TRUST, THE INCOME OF THE TRUST, LESS ANY
DEDUCTIONS OF THE TRUST, TO THE EXTENT SUCH INCOME AND DEDUCTIONS OF
SUCH TRUST WOULD BE TAKEN INTO ACCOUNT IN COMPUTING THE TAXPAYER'S
FEDERAL TAXABLE INCOME IF SUCH TRUST IN ITS ENTIRETY WERE TREATED AS A
GRANTOR TRUST FOR FEDERAL TAX PURPOSES. FOR PURPOSES OF THIS PARAGRAPH,
AN "INCOMPLETE GIFT NON-GRANTOR TRUST" MEANS A RESIDENT TRUST THAT MEETS
THE FOLLOWING CONDITIONS: (I) THE TRUST DOES NOT QUALIFY AS A GRANTOR
TRUST UNDER SECTION SIX HUNDRED SEVENTY-ONE THROUGH SIX HUNDRED SEVEN-
TY-NINE OF THE INTERNAL REVENUE CODE, AND (2) THE GRANTOR'S TRANSFER OF
ASSETS TO THE TRUST IS TREATED AS AN INCOMPLETE GIFT UNDER SECTION TWEN-
TY-FIVE HUNDRED ELEVEN OF THE INTERNAL REVENUE CODE, AND THE REGULATIONS
THEREUNDER.
S 3. Section 621 of the tax law, as added by chapter 272 of the laws
of 1963 and subsection (a) as amended by chapter 267 of the laws of
1987, is amended to read as follows:
S 621. [Credit] CREDITS to trust beneficiary receiving accumulation
distribution. (a) General. A resident beneficiary of a trust whose New
York adjusted gross income includes all or part of an accumulation
distribution by such trust, as defined in section six hundred sixty-five
of the internal revenue code, INCLUDING A BENEFICIARY WHO IS REQUIRED TO
MAKE THE MODIFICATION REQUIRED BY PARAGRAPH FORTY OF SUBSECTION (B) OF
SECTION SIX HUNDRED TWELVE OF THIS PART, shall be allowed (1) a credit
against the tax otherwise due under this article for all or a propor-
tionate part of any tax paid by the trust under this article or under
FORMER article sixteen of this chapter (as such article was in effect on
or before December thirtieth, nineteen hundred sixty), for any preceding
taxable year which would not have been payable if the trust had in fact
made distributions to its beneficiaries at the times and in the amounts
specified in section six hundred sixty-six of the internal revenue code;
AND (2) A CREDIT AGAINST THE TAXES IMPOSED BY THIS ARTICLE FOR THE TAXA-
S. 6359 172 A. 8559
BLE YEAR FOR ANY INCOME TAX IMPOSED ON THE TRUST FOR THE TAXABLE YEAR OR
ANY PRIOR TAXABLE YEAR BY ANOTHER STATE OF THE UNITED STATES, A POLI-
TICAL SUBDIVISION THEREOF, OR THE DISTRICT OF COLUMBIA, UPON INCOME BOTH
DERIVED THEREFROM AND SUBJECT TO TAX UNDER THIS ARTICLE, PROVIDED THAT
THE AMOUNT OF THE CREDIT SHALL NOT EXCEED THE PERCENTAGE OF THE TAX
OTHERWISE DUE UNDER THIS ARTICLE DETERMINED BY DIVIDING THE PORTION OF
THE INCOME THAT IS BOTH TAXABLE TO THE TRUST IN SUCH OTHER JURISDICTION
AND TAXABLE TO THE BENEFICIARY UNDER THIS ARTICLE BY THE TOTAL AMOUNT OF
THE BENEFICIARY'S NEW YORK INCOME.
(b) Limitation. The [credit] CREDITS under this section shall not
reduce the tax otherwise due from the beneficiary under this article to
an amount less than would have been due if the accumulation distribution
or his part thereof were excluded from his New York adjusted gross
income.
S 4. Section 658 of the tax law is amended by adding a new subsection
(f) to read as follows:
(F) (1) EVERY NONRESIDENT TRUST OR A TRUST DESCRIBED BY SUBPARAGRAPH
(D) OF PARAGRAPH THREE OF SUBSECTION (B) OF SECTION SIX HUNDRED FIVE OF
THIS ARTICLE SHALL MAKE A RETURN FOR ANY TAXABLE YEAR IN WHICH IT MAKES
AN ACCUMULATION DISTRIBUTION WITHIN THE MEANING OF SUBDIVISION (B) OF
SECTION SIX HUNDRED SIXTY-FIVE OF THE INTERNAL REVENUE CODE TO A BENEFI-
CIARY WHO IS A RESIDENT, WHICH RETURN SHALL INCLUDE (I) INFORMATION
IDENTIFYING SUCH RESIDENT, (II) THE AMOUNT OF SUCH ACCUMULATION DISTRIB-
UTION, AND (III) SUCH OTHER INFORMATION AS THE COMMISSIONER MAY REQUIRE.
(2) EVERY RESIDENT TRUST THAT DOES NOT FILE THE RETURN REQUIRED BY
SECTION SIX HUNDRED FIFTY-ONE OF THIS PART ON THE GROUND THAT IT IS NOT
SUBJECT TO TAX PURSUANT TO SUBPARAGRAPH (D) OF PARAGRAPH THREE OF
SUBSECTION (B) OF SECTION SIX HUNDRED FIVE OF THIS ARTICLE FOR THE TAXA-
BLE YEAR SHALL MAKE A RETURN FOR SUCH TAXABLE YEAR SUBSTANTIATING ITS
ENTITLEMENT TO THAT EXEMPTION AND PROVIDING SUCH OTHER INFORMATION AS
THE COMMISSIONER MAY REQUIRE.
(3) THE RETURNS REQUIRED BY THIS SUBSECTION SHALL BE FILED ON OR
BEFORE THE FIFTEENTH DAY OF THE FOURTH MONTH FOLLOWING THE CLOSE OF EACH
TAXABLE YEAR. FOR PURPOSES OF THIS PARAGRAPH, "TAXABLE YEAR" MEANS A
YEAR OR A PERIOD WHICH WOULD BE A TAXABLE YEAR OF THE TRUST IF IT WERE
SUBJECT TO TAX UNDER THIS ARTICLE.
S 5. Paragraph 2 of subsection (h) of section 685 of the tax law, as
amended by chapter 190 of the laws of 1990, is amended to read as
follows:
(2) If any partnership [or], S corporation, OR TRUST required to file
a return or report under subsection (c) OR SUBSECTION (F) of section six
hundred fifty-eight or under section six hundred fifty-nine OF THIS
ARTICLE for any taxable year fails to file such return or report at the
time prescribed therefor (determined with regard to any extension of
time for filing), or files a return or report which fails to show the
information required under such subsection (c) or section six hundred
fifty-nine OF THIS ARTICLE, unless it is shown that such failure is due
to reasonable cause and not due to willful neglect, there shall, upon
notice and demand by the commissioner and in the same manner as tax, be
paid by the partnership or S corporation a penalty for each month (or
fraction thereof) during which such failure continues (but not to exceed
five months). The amount of such penalty for any month is the product of
fifty dollars, multiplied by the number of partners in the partnership
or shareholders in the S corporation during any part of the taxable year
who were subject to tax under this article during any part of such taxa-
ble year, EXCEPT THAT, IN THE CASE OF A TRUST, THE PENALTY SHALL BE
S. 6359 173 A. 8559
EQUAL TO ONE HUNDRED FIFTY DOLLARS A MONTH UP TO A MAXIMUM OF FIFTEEN
HUNDRED DOLLARS PER TAXABLE YEAR.
S 6. Subdivision (b) of section 11-1712 of the administrative code of
the city of New York is amended by adding a new paragraph 36 to read as
follows:
(36) IN THE CASE OF A BENEFICIARY OF A NONRESIDENT TRUST OR A TRUST
NOT SUBJECT TO TAX PURSUANT TO SUBPARAGRAPH (D) OF PARAGRAPH THREE OF
SUBSECTION (B) OF SECTION 11-1705 OF THIS CHAPTER (EXCEPT FOR AN INCOM-
PLETE GIFT NON-GRANTOR TRUST, AS DEFINED BY PARAGRAPH THIRTY-SEVEN OF
THIS SUBDIVISION), THE AMOUNT OF ANY ACCUMULATION DISTRIBUTION AS
DESCRIBED IN SUBSECTION (B) OF SECTION SIX HUNDRED SIXTY-FIVE OF THE
INTERNAL REVENUE CODE FOR THE TAX YEAR, SUCH AMOUNT TO BE DETERMINED
WITHOUT REGARD TO THE PENULTIMATE SENTENCE OF SUCH SUBSECTION THAT
REFERENCES SECTION SIX HUNDRED SIXTY-SEVEN OF SUCH CODE AND WITHOUT
REGARD TO SUBSECTION (C) OF SECTION SIX HUNDRED SIXTY-FIVE OF THE INTER-
NAL REVENUE CODE, TO THE EXTENT NOT ALREADY INCLUDED IN FEDERAL GROSS
INCOME FOR THE TAX YEAR.
S 7. Subdivision (b) of section 11-1712 of the administrative code of
the city of New York is amended by adding a new paragraph 37 to read as
follows:
(37) IN THE CASE OF A TAXPAYER WHO TRANSFERRED PROPERTY TO AN INCOM-
PLETE GIFT NON-GRANTOR TRUST, THE INCOME OF THE TRUST, LESS ANY
DEDUCTIONS OF SUCH TRUST, TO THE EXTENT SUCH INCOME AND DEDUCTIONS OF
SUCH TRUST WOULD BE TAKEN INTO ACCOUNT IN COMPUTING THE TAXPAYER'S
FEDERAL TAXABLE INCOME IF SUCH TRUST IN ITS ENTIRETY WERE TREATED AS A
GRANTOR TRUST FOR FEDERAL TAX PURPOSES. FOR PURPOSES OF THIS PARAGRAPH,
AN "INCOMPLETE GIFT NON-GRANTOR TRUST" MEANS A RESIDENT TRUST THAT MEETS
THE FOLLOWING CONDITIONS: (I) THE TRUST DOES NOT QUALIFY AS A GRANTOR
TRUST UNDER SECTION SIX HUNDRED SEVENTY-ONE THROUGH SIX HUNDRED SEVEN-
TY-NINE OF THE INTERNAL REVENUE CODE, AND (2) THE GRANTOR'S TRANSFER OF
ASSETS TO THE TRUST IS TREATED AS AN INCOMPLETE GIFT UNDER SECTION TWEN-
TY FIVE HUNDRED ELEVEN OF THE INTERNAL REVENUE CODE, AND THE REGULATIONS
THEREUNDER.
S 8. Section 11-1721 of the administrative code of the city of New
York, subdivisions (a) and (b) as amended by section 72 and such section
as renumbered by section 43 of chapter 639 of the laws of 1986, is
amended to read as follows:
S 11-1721 [Credit] CREDITS to trust beneficiary receiving accumulation
distribution. (a) General. A city resident beneficiary of a trust whose
city adjusted gross income includes all or part of an accumulation
distribution by such trust, as defined in section six hundred sixty-five
of the internal revenue code, INCLUDING A BENEFICIARY WHO IS REQUIRED TO
MAKE THE MODIFICATION REQUIRED BY PARAGRAPH THIRTY-SIX OF SUBDIVISION
(B) OF SECTION 11-1712 OF THIS SUBCHAPTER, shall be allowed (1) a credit
against the tax otherwise due under this chapter for all or a propor-
tionate part of any tax paid by the trust under this chapter or under
FORMER title T of chapter forty-six of this code, as it was in effect
prior to September first, nineteen hundred eighty-six, for any preceding
taxable year which would not have been payable if the trust had in fact
made distributions to its beneficiaries at the times and in the amounts
specified in section six hundred sixty-six of the internal revenue code;
AND (2) A CREDIT AGAINST THE TAXES IMPOSED BY THIS CHAPTER FOR THE TAXA-
BLE YEAR FOR ANY INCOME TAX IMPOSED FOR THE TAXABLE YEAR OR ANY PRIOR
TAXABLE YEAR BY ANOTHER STATE OF THE UNITED STATES, A POLITICAL SUBDIVI-
SION THEREOF, OR THE DISTRICT OF COLUMBIA, UPON INCOME BOTH DERIVED
THEREFROM AND SUBJECT TO TAX UNDER THIS CHAPTER, PROVIDED THAT THE
S. 6359 174 A. 8559
AMOUNT OF THE CREDIT SHALL NOT EXCEED THE PERCENTAGE OF THE TAX OTHER-
WISE DUE UNDER THIS CHAPTER DETERMINED BY DIVIDING THE PORTION OF THE
INCOME THAT IS BOTH TAXABLE TO THE TRUST IN SUCH OTHER JURISDICTION AND
TAXABLE TO THE BENEFICIARY UNDER THIS CHAPTER BY THE TOTAL AMOUNT OF THE
BENEFICIARY'S NEW YORK CITY INCOME.
(b) Limitation. The [credit] CREDITS under this section shall not
reduce the tax otherwise due from the beneficiary under this chapter to
an amount less than would have been due if the accumulation distribution
or his or her part thereof were excluded from his or her city adjusted
gross income.
S 9. This act shall take effect immediately and shall apply to taxable
years beginning on or after January 1, 2014, provided that sections one
and six of this act shall not apply to income of an exempt resident
trust paid to a beneficiary before June 1, 2014, and sections two and
seven of this act shall not apply to income from a trust that is liqui-
dated before June 1, 2014.
PART J
Section 1. Section 602 of the tax law is REPEALED.
S 2. Paragraph 4 of subsection (c) and paragraph 4 of subsection (d)
of section 606 of the tax law, paragraph 4 of subsection (c) as added by
chapter 309 of the laws of 1996 and paragraph 4 of subsection (d) as
amended by chapter 2 of the laws of 1995, are amended to read as
follows:
(4) Part-year residents. In the case of a part-year resident taxpayer,
the credit under this subsection shall be allowed against the tax deter-
mined under subsections (a) through (d) of section six hundred one
reduced by the credit permitted under subsection (b) of this section,
and any excess credit after such application shall be allowed against
the [taxes] TAX imposed by [sections six hundred two and] SECTION six
hundred three. Any remaining excess, after such application, shall be
refunded as provided in paragraph two hereof, provided, however, that
any overpayment under such paragraph shall be limited to the amount of
the remaining excess multiplied by a fraction, the numerator of which is
federal adjusted gross income for the period of residence, computed as
if the taxable year for federal income tax purposes were limited to the
period of residence, and the denominator of which is federal adjusted
gross income for the taxable year.
(4) Part-year residents. In the case of a part-year resident taxpayer,
the credit under this subsection shall be allowed against the tax deter-
mined under subsections (a) through (d) of section six hundred one
reduced by the credits permitted under subsections (b), (c) and (m) of
this section, and any excess credit after such application shall be
allowed against the [taxes] TAX imposed by [sections six hundred two
and] SECTION six hundred three. Any remaining excess, after such appli-
cation, shall be refunded as provided in paragraph two hereof, provided,
however, that any overpayment under such paragraph shall be limited to
the amount of the remaining excess multiplied by a fraction, the numera-
tor of which is federal adjusted gross income for the period of resi-
dence, computed as if the taxable year for federal income tax purposes
were limited to the period of residence, and the denominator of which is
federal adjusted gross income for the taxable year.
S 3. Section 622 of the tax law is REPEALED.
S 4. Section 636 of the tax law is REPEALED.
S. 6359 175 A. 8559
S 5. Subsections (a), (b) and (c) of section 639 of the tax law, as
added by chapter 170 of the laws of 1994, are amended to read as
follows:
(a) If an individual changes status from resident to nonresident he
shall, regardless of his method of accounting, accrue to the period of
residence any items of income, gain, loss, deduction, [items of tax
preference] or ordinary income portion of a lump sum distribution accru-
ing prior to the change of status, with the applicable modifications and
adjustments to federal adjusted gross income[,] AND itemized deductions
[and items of tax preference] under sections six hundred twelve[,] AND
six hundred fifteen [and six hundred twenty-two], if not otherwise prop-
erly includible or allowable for New York income tax purposes for such
period or a prior taxable year under his method of accounting.
(b) If an individual changes status from nonresident to resident he
shall, regardless of his method of accounting, accrue to the period of
nonresidence any items of income, gain, loss or deduction, [items of tax
preference] or ordinary income portion of a lump sum distribution accru-
ing prior to the change of status, with the applicable modifications and
adjustments to federal adjusted gross income[,] AND itemized deductions
[and items of tax preference] under sections six hundred twelve[,] AND
six hundred fifteen [and six hundred twenty-two], other than items
derived from or connected with New York sources, if not otherwise prop-
erly includible or allowable for New York income tax purposes for such
period or for a prior taxable year under his method of accounting.
(c) No item of income, gain, loss, deduction, [item of tax prefer-
ence,] ordinary income portion of a lump sum distribution or modifica-
tion or adjustment which is accrued under this section shall be taken
into account in determining the tax under this article for any subse-
quent taxable year.
S 6. Paragraphs 1, 2, 3 and 4 of subsection (a) of section 651 of the
tax law, paragraph 1 as amended by chapter 333 of the laws of 1987,
paragraph 2 as amended by chapter 28 of the laws of 1987, and paragraphs
3 and 4 as amended by chapter 170 of the laws of 1994, are amended to
read as follows:
(1) every resident individual (A) required to file a federal income
tax return for the taxable year, or (B) having federal adjusted gross
income for the taxable year, increased by the modifications under
subsection (b) of section six hundred twelve, in excess of four thousand
dollars, or in excess of his New York standard deduction, if lower, or
(C) [subject to tax under section six hundred two, or (D)] having
received during the taxable year a lump sum distribution any portion of
which is subject to tax under section six hundred three;
(2) every resident estate or trust required to file a federal income
tax return for the taxable year, or having any New York taxable income
for the taxable year, determined under section six hundred eighteen, [or
subject to tax under section six hundred two,] or having received during
the taxable year a lump sum distribution any portion of which is subject
to tax under section six hundred three;
(3) every nonresident or part-year resident individual having New York
source income for the taxable year, determined under part III of this
article, and having New York adjusted gross income for the taxable year,
determined under part II of this article, in excess of the taxpayer's
New York standard deduction, [or subject to tax under section six
hundred two,] or having received during the taxable year a lump sum
distribution any portion of which is subject to tax under section six
hundred three; and
S. 6359 176 A. 8559
(4) every nonresident estate or trust or part-year resident trust
having New York source income for the taxable year, determined under
part III of this article, and having New York adjusted gross income for
the taxable year, determined under paragraph four of subsection (e) of
section six hundred one, [or subject to tax under section six hundred
two,] or having received during the taxable year a lump sum distribution
any portion of which is subject to tax under section six hundred three.
S 7. Paragraph 6 of subsection (b) of section 654 of the tax law, as
added by section 5 of part Q of chapter 407 of the laws of 1999, is
amended to read as follows:
(6) In subparagraph (B) of paragraph two of subsection (d), the phrase
"section 1 or 55" shall be read as "section six hundred one [or six
hundred two] of this article".
S 8. Section 659 of the tax law, as amended by chapter 577 of the laws
of 1997, is amended to read as follows:
S 659. Report of federal changes, corrections or disallowances. If
the amount of a taxpayer's federal taxable income, [federal items of tax
preference,] total taxable amount or ordinary income portion of a lump
sum distribution or includible gain of a trust reported on his federal
income tax return for any taxable year, or the amount of a taxpayer's
earned income credit or credit for employment-related expenses set forth
on such return, or the amount of any federal foreign tax credit affect-
ing the calculation of the credit for Canadian provincial taxes under
section six hundred twenty or six hundred twenty-A of this article, or
the amount of any claim of right adjustment, is changed or corrected by
the United States internal revenue service or other competent authority
or as the result of a renegotiation of a contract or subcontract with
the United States, or the amount an employer is required to deduct and
withhold from wages for federal income tax withholding purposes is
changed or corrected by such service or authority or if a taxpayer's
claim for credit or refund of federal income tax is disallowed in whole
or in part, the taxpayer or employer shall report such change or
correction or disallowance within ninety days after the final determi-
nation of such change, correction, renegotiation or disallowance, or as
otherwise required by the commissioner, and shall concede the accuracy
of such determination or state wherein it is erroneous. The allowance
of a tentative carryback adjustment based upon a net operating loss
carryback pursuant to section sixty-four hundred eleven of the internal
revenue code shall be treated as a final determination for purposes of
this section. Any taxpayer filing an amended federal income tax return
and any employer filing an amended federal return of income tax withheld
shall also file within ninety days thereafter an amended return under
this article, and shall give such information as the commissioner may
require. The commissioner may by regulation prescribe such exceptions
to the requirements of this section as he or she deems appropriate. For
purposes of this section, (i) the term "taxpayer" shall include a part-
nership having a resident partner or having any income derived from New
York sources, and a corporation with respect to which the taxable year
of such change, correction, disallowance or amendment is a year with
respect to which the election provided for in subsection (a) of section
six hundred sixty of this article is in effect, and (ii) the term
"federal income tax return" shall include the returns of income required
under sections six thousand thirty-one and six thousand thirty-seven of
the internal revenue code. In the case of such a corporation, such
report shall also include any change or correction of the taxes
described in paragraphs two and three of subsection (f) of section thir-
S. 6359 177 A. 8559
teen hundred sixty-six of the internal revenue code. Reports made under
this section by a partnership or corporation shall indicate the portion
of the change in each item of income, gain, loss or deduction (and, in
the case of a corporation, of each change in, or disallowance of a claim
for credit or refund of, a tax referred to in the preceding sentence)
allocable to each partner or shareholder and shall set forth such iden-
tifying information with respect to such partner or shareholder as may
be prescribed by the commissioner.
S 9. Subsection (d) of section 683 of the tax law, as amended by chap-
ter 170 of the laws of 1994, is amended to read as follows:
(d) Omission of income, [item of tax preference,] total taxable amount
or ordinary income portion of a lump sum distribution on return.--The
tax may be assessed at any time within six years after the return was
filed if--
(1) an individual omits from his New York adjusted gross income, [the
sum of his items of tax preference,] or the total taxable amount or
ordinary income portion of a lump sum distribution an amount properly
includible therein which is in excess of twenty-five percent of the
amount of New York adjusted gross income, [the sum of the items of tax
preference,] or the total taxable amount or ordinary income portion of a
lump sum distribution stated in the return, or
(2) an estate or trust omits from its New York adjusted gross income,
[the sum of its items of tax preference,] or the total taxable amount or
ordinary income portion of a lump sum distribution an amount properly
includible therein which is in excess of twenty-five percent of the
amount stated in the return of New York adjusted gross income determined
in accordance with paragraph four of subsection (e) of section six
hundred one, [or the sum of the items of tax preference,] or the total
taxable amount or ordinary income portion of a lump sum distribution,
respectively. For purposes of this subsection there shall not be taken
into account any amount which is omitted in the return if such amount is
disclosed in the return, or in a statement attached to the return, in a
manner adequate to apprise the commissioner of the nature and amount of
the item of income, [tax preference,] total taxable amount or ordinary
income portion of a lump sum distribution.
S 10. Subparagraph (B) of paragraph 4 of subsection (c) of section 685
of the tax law, as amended by chapter 28 of the laws of 1987, is amended
to read as follows:
(B) Determination of annualized income installment.--In the case of
any required installment, the annualized income installment is the
excess, if any, of an amount equal to the applicable percentage of the
tax for the taxable year computed by placing on an annualized basis the
taxable income [and minimum taxable income] for months in the taxable
year ending before the due date for the installment, over the aggregate
amount of any prior required installments for the taxable year. The
applicable percentage of the tax shall be twenty-two and one-half
percent in the case of the first installment, forty-five percent in the
case of the second installment, sixty-seven and one-half percent in the
case of the third installment and ninety percent in the case of the
fourth installment, and shall be computed without regard to any increase
in the rates applicable to the taxable year unless such increase was
enacted at least thirty days prior to the due date of the installment.
S 11. Paragraphs 2 and 3 of subsection (a) of section 1301 of the tax
law, as amended by chapter 209 of the laws of 2011, are amended to read
as follows:
S. 6359 178 A. 8559
(2) [for taxable years beginning before two thousand fifteen, a city
minimum income tax on such residents, and
(3)] for taxable years beginning after nineteen hundred seventy-six, a
separate tax on the ordinary income portion of lump sum distributions of
such residents, at the rates provided for herein, such taxes to be
administered, collected and distributed by the commissioner as provided
for in this article.
S 12. Section 1301-A of the tax law is REPEALED.
S 13. Subsection (a) of section 1302 of the tax law, as amended by
chapter 333 of the laws of 1987, is amended to read as follows:
(a) Imposition of tax. The city personal income tax (other than the
[city minimum income tax and the] city separate tax on the ordinary
income portion of lump sum distributions) imposed pursuant to the
authority of this article shall be imposed for each taxable year on the
city taxable income of every city resident individual, estate and trust.
A taxpayer's taxable year for purposes of a tax imposed pursuant to the
authority of this article shall be the same as his taxable year under
article twenty-two of this chapter.
S 14. The opening paragraph of subsection (a) of section 1304 of the
tax law, as amended by section 134 of part A of chapter 389 of the laws
of 1997, is amended to read as follows:
A tax (other than the [city minimum income tax, the] city separate tax
relating to qualified higher education funds and the city separate tax
on the ordinary income portion of lump sum distributions) imposed pursu-
ant to the authority of section thirteen hundred one of this article
shall be determined as follows:
S 15. Subsection (c) of section 1307 of the tax law, as amended by
chapter 712 of the laws of 2004, is amended to read as follows:
(c) When an individual changes his status from city resident to city
nonresident, or from city nonresident to city resident, he shall,
regardless of his method of accounting, accrue any items of income,
gain, loss, deduction[, items of tax preference] or ordinary income
portion of a lump sum distribution accruing prior to the change of
status, with the applicable modifications and adjustments to federal
adjusted gross income[,] AND itemized deductions [and items of tax pref-
erence] under sections six hundred twelve[,] AND six hundred fifteen
[and six hundred twenty-two], if not otherwise properly includible or
allowable for New York income tax purposes for such period or a prior
taxable year under his method of accounting. Such accruals shall be made
as provided in section six hundred thirty-nine of this chapter.
S 16. Subsection (a) of section 1306 of the tax law, as amended by
chapter 333 of the laws of 1987, is amended to read as follows:
(a) General. On or before the fifteenth day of the fourth month
following the close of a taxable year, an income tax return under a city
tax imposed pursuant to the authority of this article shall be made and
filed by or for every city resident individual, estate or trust required
to file a New York state personal income tax (including [a minimum
income tax and] a city separate tax on the ordinary income portion of
lump sum distributions) return for the taxable year.
S 17. Section 11-1702 of the administrative code of the city of New
York is REPEALED.
S 18. Subdivision (a) of section 11-1704 of the administrative code of
the city of New York, as amended by chapter 17 of the laws of 1997, is
amended to read as follows:
(a) In addition to the taxes imposed by sections 11-1701[, 11-1702]
and 11-1703, there is hereby imposed for each taxable year beginning
S. 6359 179 A. 8559
after nineteen hundred eighty-nine but before nineteen hundred ninety-
nine, a tax surcharge on the city taxable income of every city resident
individual, estate and trust.
S 19. Subdivision (c) of section 11-1704 of the administrative code of
the city of New York, as amended by chapter 271 of the laws of 1991, is
amended to read as follows:
(c) The tax surcharge imposed pursuant to this section shall be admin-
istered, collected and distributed by the commissioner of taxation and
finance in the same manner as the taxes imposed pursuant to sections
11-1701[, 11-1702] and 11-1703, and all of the provisions of this chap-
ter, including sections 11-1706, 11-1721 and 11-1773, shall apply to the
tax surcharge imposed by this section.
S 20. Section 11-1722 of the administrative code of the city of New
York is REPEALED.
S 21. Subdivision (a) of section 11-1751 of the administrative code of
the city of New York, as amended by chapter 333 of the laws of 1987, is
amended to read as follows:
(a) General. On or before the fifteenth day of the fourth month
following the close of a taxable year, an income tax return under this
chapter shall be made and filed by or for every city resident individ-
ual, estate or trust required to file a New York state personal income
tax (including a [minimum income tax and] separate tax on the ordinary
income portion of lump sum distributions) return for the taxable year.
S 22. Subdivision (b) of section 11-1754 of the administrative code of
the city of New York, as amended by chapter 712 of the laws of 2004, is
amended to read as follows:
(b) City taxable income [and city minimum taxable income] as city
resident. The city taxable income [and city minimum taxable income] for
the portion of the year during which he or she is a city resident shall
be determined, except as provided in subdivision (c), as if his or her
taxable year for federal income tax purposes were limited to the period
of his or her city resident status.
S 23. Paragraph 6 of subdivision (b) of section 11-1755 of the admin-
istrative code of the city of New York, as added by section 17 of part Q
of chapter 407 of the laws of 1999, is amended to read as follows:
(6) In subparagraph (B) of paragraph two of subsection (d), the phrase
"section 1 or 55" shall be read as "section 11-1701 [or 11-1702] of this
chapter".
S 24. Section 11-1759 of the administrative code of the city of New
York, as amended by chapter 577 of the laws of 1997, is amended to read
as follows:
S 11-1759 Report of federal changes, corrections or disallowances. If
the amount of a taxpayer's federal taxable income, [federal items of tax
preference,] total taxable amount or ordinary income portion of a lump
sum distribution or includible gain of a trust reported on his federal
income tax return for any taxable year, or the amount of any claim of
right adjustment, is changed or corrected by the United States internal
revenue service or other competent authority, or as the result of a
renegotiation of a contract or subcontract with the United States or the
amount an employer is required to deduct and withhold from wages for
federal income tax withholding purposes is changed or corrected by such
service or authority or if a taxpayer's claim for credit or refund of
federal income tax is disallowed in whole or in part, the taxpayer or
employer shall report such change or correction or disallowance within
ninety days after the final determination of such change, correction,
renegotiation, or disallowance, or as otherwise required by the commis-
S. 6359 180 A. 8559
sioner, and shall concede the accuracy of such determination or state
wherein it is erroneous. The allowance of a tentative carryback adjust-
ment based upon a net operating loss carryback pursuant to section
sixty-four hundred eleven of the internal revenue code shall be treated
as a final determination for purposes of this section. Any taxpayer
filing an amended federal income tax return and any employer filing an
amended federal return of income tax withheld shall also file within
ninety days thereafter an amended return under this chapter, and shall
give such information as the commissioner may require. The commissioner
may by regulation prescribe such exceptions to the requirements of this
section as he or she deems appropriate. For purposes of this section,
(i) the term "taxpayer" shall include a partnership having a resident
partner or having any income derived from New York sources, and a corpo-
ration with respect to which the taxable year of such change,
correction, disallowance or amendment is a year with respect to which
the election provided for in subsection (a) of section six hundred sixty
of the tax law is in effect, and (ii) the term "federal income tax
return" shall include the returns of income required under sections six
thousand thirty-one and six thousand thirty-seven of the internal reven-
ue code. In the case of such a corporation, such report shall also
include any change or correction of the taxes described in paragraphs
two and three of subsection (f) of section thirteen hundred sixty-six of
the internal revenue code. Reports made under this section by a partner-
ship or corporation shall indicate the portion of the change in each
item of income, gain, loss or deduction (and, in the case of a corpo-
ration, of each change in, or disallowance of a claim for credit or
refund of, a tax referred to in the preceding sentence) allocable to
each partner or shareholder and shall set forth such identifying infor-
mation with respect to such partner or shareholder as may be prescribed
by the commissioner.
S 25. Subdivision (d) of section 11-1783 of the administrative code of
the city of New York, as amended by chapter 170 of the laws of 1994, is
amended to read as follows:
(d) Omission of income, [item of tax preference,] total taxable amount
or ordinary income portion of a lump sum distribution on return. The tax
may be assessed at any time within six years after the return was filed
if:
(1) an individual omits from his city adjusted gross income[, the sum
of his items of tax preference, or] the total taxable amount or ordinary
income portion of a lump sum distribution an amount properly includible
therein which is in excess of twenty-five percent of the amount of city
adjusted gross income[, the sum of the items of tax preference] or the
total taxable amount or ordinary income portion of a lump sum distrib-
ution stated in the return, or
(2) an estate or trust omits from its city adjusted gross income, [the
sum of its items of tax preference,] or the total taxable amount or
ordinary income portion of a lump sum distribution an amount properly
includible therein which is in excess of twenty-five percent of the
amount stated in the return of city adjusted gross income, [or the sum
of the items of tax preference,] or the total taxable amount or ordinary
income portion of a lump sum distribution, respectively. For purposes of
this paragraph, city adjusted gross income means New York adjusted gross
income as determined under paragraph four of subsection (e) of section
six hundred one of the tax law.
For purposes of this subdivision there shall not be taken into account
any amount which is omitted in the return if such amount is disclosed in
S. 6359 181 A. 8559
the return, or in a statement attached to the return, in a manner
adequate to apprise the commissioner of the nature and amount of the
item of income, [tax preference,] the total taxable amount or ordinary
income portion of a lump sum distribution.
S 26. Subparagraph (B) of paragraph 4 of subdivision (c) of section
11-1785 of the administrative code of the city of New York, as amended
by chapter 333 of the laws of 1987, is amended to read as follows:
(B) Determination of annualized income installment. In the case of any
required installment, the annualized income installment is the excess,
if any, of an amount equal to the applicable percentage of the tax for
the taxable year computed by placing on an annualized basis the taxable
income [and minimum taxable income] for months in the taxable year
ending before the due date for the installment, over the aggregate
amount of any prior required installments for the taxable year. The
applicable percentage of the tax shall be twenty-two and one-half
percent in the case of the first installment, forty-five percent in the
case of the second installment, sixty-seven and one-half percent in the
case of the third installment and ninety percent in the case of the
fourth installment, and shall be computed without regard to any increase
in the rates applicable to the taxable year unless such increase was
enacted at least thirty days prior to the due date of the installment.
S 27. This act shall take effect immediately and apply to taxable
years beginning on or after January 1, 2014.
PART K
Section 1. Subsection (e-1) of section 606 of the tax law is relet-
tered subsection (e-2).
S 2. Section 606 of the tax law is amended by adding a new subsection
(e-1) to read as follows:
(E-1) ENHANCED REAL PROPERTY TAX CIRCUIT BREAKER CREDIT. (1) FOR
PURPOSES OF THIS SUBSECTION:
(A) "QUALIFIED TAXPAYER" MEANS A RESIDENT INDIVIDUAL OF THE STATE WHO
HAS OCCUPIED THE SAME RESIDENCE FOR SIX MONTHS OR MORE OF THE TAXABLE
YEAR, AND IS REQUIRED OR CHOOSES TO FILE A RETURN UNDER THIS ARTICLE.
(B) "HOUSEHOLD" OR "MEMBERS OF THE HOUSEHOLD" MEANS A QUALIFIED
TAXPAYER AND ALL OTHER PERSONS, NOT NECESSARILY RELATED, WHO HAVE THE
SAME RESIDENCE AND SHARE ITS FURNISHINGS, FACILITIES AND ACCOMMODATIONS.
SUCH TERMS SHALL NOT INCLUDE A TENANT, SUBTENANT, ROOMER OR BOARDER WHO
IS NOT RELATED TO THE QUALIFIED TAXPAYER IN ANY DEGREE SPECIFIED IN
PARAGRAPHS ONE THROUGH EIGHT OF SUBSECTION (A) OF SECTION ONE HUNDRED
FIFTY-TWO OF THE INTERNAL REVENUE CODE. PROVIDED, HOWEVER, NO PERSON
MAY BE A MEMBER OF MORE THAN ONE HOUSEHOLD AT ONE TIME.
(C) "HOUSEHOLD GROSS INCOME" MEANS THE AGGREGATE ADJUSTED GROSS INCOME
OF ALL MEMBERS OF THE HOUSEHOLD FOR THE TAXABLE YEAR AS REPORTED FOR
FEDERAL INCOME TAX PURPOSES, OR WHICH WOULD BE REPORTED AS ADJUSTED
GROSS INCOME IF A FEDERAL INCOME TAX RETURN WERE REQUIRED TO BE FILED,
WITH THE MODIFICATIONS IN SUBSECTION (B) OF SECTION SIX HUNDRED TWELVE
OF THIS ARTICLE BUT WITHOUT THE MODIFICATIONS IN SUBSECTION (C) OF SUCH
SECTION, PLUS ANY PORTION OF THE GAIN FROM THE SALE OR EXCHANGE OF PROP-
ERTY OTHERWISE EXCLUDED FROM SUCH AMOUNT; EARNED INCOME FROM SOURCES
WITHOUT THE UNITED STATES EXCLUDABLE FROM FEDERAL GROSS INCOME BY
SECTION NINE HUNDRED ELEVEN OF THE INTERNAL REVENUE CODE; SUPPORT MONEY
NOT INCLUDED IN ADJUSTED GROSS INCOME; NONTAXABLE STRIKE BENEFITS;
SUPPLEMENTAL SECURITY INCOME PAYMENTS; THE GROSS AMOUNT OF ANY PENSION
OR ANNUITY BENEFITS TO THE EXTENT NOT INCLUDED IN SUCH ADJUSTED GROSS
S. 6359 182 A. 8559
INCOME (INCLUDING, BUT NOT LIMITED TO, RAILROAD RETIREMENT BENEFITS AND
ALL PAYMENTS RECEIVED UNDER THE FEDERAL SOCIAL SECURITY ACT AND VETER-
ANS' DISABILITY PENSIONS); NONTAXABLE INTEREST RECEIVED FROM THE STATE
OF NEW YORK, ITS AGENCIES, INSTRUMENTALITIES, PUBLIC CORPORATIONS, OR
POLITICAL SUBDIVISIONS (INCLUDING A PUBLIC CORPORATION CREATED PURSUANT
TO AGREEMENT OR COMPACT WITH ANOTHER STATE OR CANADA); WORKERS' COMPEN-
SATION; THE GROSS AMOUNT OF "LOSS-OF-TIME" INSURANCE; AND THE AMOUNT OF
CASH PUBLIC ASSISTANCE AND RELIEF, OTHER THAN MEDICAL ASSISTANCE FOR THE
NEEDY, PAID TO OR FOR THE BENEFIT OF THE QUALIFIED TAXPAYER OR MEMBERS
OF HIS OR HER HOUSEHOLD. HOUSEHOLD GROSS INCOME SHALL NOT INCLUDE
SURPLUS FOODS OR OTHER RELIEF IN KIND OR PAYMENTS MADE TO INDIVIDUALS
BECAUSE OF THEIR STATUS AS VICTIMS OF NAZI PERSECUTION AS DEFINED IN
P.L. 103-286. PROVIDED, FURTHER, HOUSEHOLD GROSS INCOME SHALL ONLY
INCLUDE ALL SUCH INCOME RECEIVED BY ALL MEMBERS OF THE HOUSEHOLD WHILE
MEMBERS OF SUCH HOUSEHOLD. IN COMPUTING HOUSEHOLD GROSS INCOME, THE NET
AMOUNT OF LOSS REPORTED ON FEDERAL SCHEDULE C, D, E, OR F SHALL NOT
EXCEED THREE THOUSAND DOLLARS PER SCHEDULE. IN ADDITION, THE NET AMOUNT
OF ANY OTHER SEPARATE CATEGORY OF LOSS SHALL NOT EXCEED THREE THOUSAND
DOLLARS. THE AGGREGATE AMOUNT OF ALL LOSSES INCLUDED IN COMPUTING HOUSE-
HOLD GROSS INCOME SHALL NOT EXCEED FIFTEEN THOUSAND DOLLARS.
(D) "RESIDENCE" MEANS A DWELLING IN THIS STATE OWNED BY THE TAXPAYER,
AND SO MUCH OF THE LAND ABUTTING IT, NOT EXCEEDING ONE ACRE, AS IS
REASONABLY NECESSARY FOR USE OF THE DWELLING AS A HOME, AND MAY CONSIST
OF A PART OF A MULTI-DWELLING OR MULTI-PURPOSE BUILDING INCLUDING A
COOPERATIVE OR CONDOMINIUM. RESIDENCE INCLUDES A TRAILER OR MOBILE
HOME, USED EXCLUSIVELY FOR RESIDENTIAL PURPOSES AND DEFINED AS REAL
PROPERTY PURSUANT TO PARAGRAPH (G) OF SUBDIVISION TWELVE OF SECTION ONE
HUNDRED TWO OF THE REAL PROPERTY TAX LAW.
(E) "QUALIFYING REAL PROPERTY TAXES" MEANS ALL REAL PROPERTY TAXES,
SPECIAL AD VALOREM LEVIES AND SPECIAL ASSESSMENTS, EXCLUSIVE OF PENAL-
TIES AND INTEREST, LEVIED BY A TAXING JURISDICTION WITH A CAP-COMPLIANT
BUDGET ON THE RESIDENCE OF A QUALIFIED TAXPAYER AND PAID DURING THE
TAXABLE YEAR.
(I) FOR THE PURPOSES OF THIS SUBSECTION, A "CAP-COMPLIANT BUDGET" FOR
A SCHOOL DISTRICT SUBJECT TO SECTION TWO THOUSAND TWENTY-THREE-A OF THE
EDUCATION LAW MEANS A BUDGET FOR WHICH THE CHIEF EXECUTIVE OFFICER OF
SUCH SCHOOL DISTRICT HAS CERTIFIED, NO LATER THAN THE TWENTY-FIRST DAY
OF THE FISCAL YEAR TO WHICH IT APPLIES, TO THE STATE COMPTROLLER, THE
COMMISSIONER OF TAXATION AND FINANCE AND THE COMMISSIONER OF EDUCATION,
IN A FORM AND MANNER PRESCRIBED BY THE STATE COMPTROLLER IN CONSULTATION
WITH THE COMMISSIONER OF TAXATION AND FINANCE AND THE COMMISSIONER OF
EDUCATION, THAT THE BUDGET SO ADOPTED DOES NOT EXCEED THE TAX LEVY LIMIT
PRESCRIBED BY SUCH SECTION. A "CAP-COMPLIANT BUDGET" FOR A LOCAL GOVERN-
MENT SUBJECT TO SECTION THREE-C OF THE GENERAL MUNICIPAL LAW SHALL MEAN
A BUDGET FOR WHICH THE CHIEF EXECUTIVE OFFICER OR BUDGET OFFICER OF SUCH
LOCAL GOVERNMENT UNIT HAS CERTIFIED, NO LATER THAN THE TWENTY-FIRST DAY
OF THE FISCAL YEAR TO WHICH IT APPLIES, TO THE STATE COMPTROLLER AND THE
COMMISSIONER OF TAXATION AND FINANCE, IN A FORM AND MANNER PRESCRIBED BY
THE STATE COMPTROLLER IN CONSULTATION WITH THE COMMISSIONER OF TAXATION
AND FINANCE, THAT THE ADOPTED BUDGET OF SUCH LOCAL GOVERNMENT DID NOT
REQUIRE AND THE GOVERNING BODY OF SUCH LOCAL GOVERNMENT DID NOT ENACT OR
APPROVE A LOCAL LAW OR RESOLUTION TO OVERRIDE THE TAX LEVY LIMIT
PRESCRIBED BY SUCH SECTION, OR, IF THE GOVERNING BODY OF THE LOCAL
GOVERNMENT DID ENACT A LOCAL LAW OR APPROVE A RESOLUTION TO OVERRIDE
SUCH TAX LEVY LIMIT, THAT SUCH LOCAL LAW OR RESOLUTION WAS SUBSEQUENTLY
REPEALED. IF A CERTIFICATION REQUIRED BY THIS PARAGRAPH HAS BEEN MADE
S. 6359 183 A. 8559
AND THE ACTUAL TAX LEVY OF THE TAXING JURISDICTION EXCEEDS THE APPLICA-
BLE TAX LEVY LIMIT, THE EXCESS AMOUNT SHALL BE PLACED IN RESERVE AND
USED IN THE MANNER PRESCRIBED BY SUBDIVISION FIVE OF SECTION TWENTY
THOUSAND TWENTY-THREE-A OF THE EDUCATION LAW OR SUBDIVISION SIX OF
SECTION THREE-C OF THE GENERAL MUNICIPAL LAW, WHICHEVER IS APPLICABLE,
EVEN IF A TAX LEVY IN EXCESS OF THE TAX LEVY LIMIT HAD BEEN DULY AUTHOR-
IZED FOR THE APPLICABLE FISCAL YEAR IN ACCORDANCE WITH SUCH SECTION.
(II) FOR TAX YEAR TWO THOUSAND FOURTEEN, ONLY REAL PROPERTY TAXES
LEVIED BY SCHOOL DISTRICTS WITH CAP-COMPLIANT BUDGETS CONSTITUTE QUALI-
FYING REAL PROPERTY TAXES.
(III) IN A CITY WITH A POPULATION OF ONE MILLION OR MORE, THE
RESTRICTION IN CLAUSE (I) OF THIS SUBPARAGRAPH THAT TAXES MUST BE LEVIED
BY A TAXING JURISDICTION WITH A CAP-COMPLIANT BUDGET DOES NOT APPLY.
HOWEVER, REAL PROPERTY TAXES, SPECIAL AD VALOREM LEVIES, AND SPECIAL
ASSESSMENTS LEVIED BY SUCH CITY SHALL CONSTITUTE QUALIFYING REAL PROPER-
TY TAXES ONLY IF TAXES LEVIED IN THE STATE OUTSIDE SUCH CITY ARE
REQUIRED FOR PURPOSES OF THIS CREDIT TO BE LEVIED BY TAXING JURISDIC-
TIONS WITH CAP-COMPLIANT BUDGETS.
(IV) A QUALIFIED TAXPAYER MAY ELECT TO INCLUDE ANY ADDITIONAL AMOUNT
THAT WOULD HAVE BEEN LEVIED IN THE ABSENCE OF AN EXEMPTION FROM REAL
PROPERTY TAXATION PURSUANT TO SECTION FOUR HUNDRED SIXTY-SEVEN OF THE
REAL PROPERTY TAX LAW. IF TENANT-STOCKHOLDERS IN A COOPERATIVE HOUSING
CORPORATION HAVE MET THE REQUIREMENTS OF SECTION TWO HUNDRED SIXTEEN OF
THE INTERNAL REVENUE CODE BY WHICH THEY ARE ALLOWED A DEDUCTION FOR REAL
ESTATE TAXES, THE AMOUNT OF TAXES SO ALLOWABLE, OR WHICH WOULD BE ALLOW-
ABLE IF THE TAXPAYER HAD FILED RETURNS ON A CASH BASIS, SHALL BE QUALI-
FYING REAL PROPERTY TAXES. IF A RESIDENCE IS OWNED BY TWO OR MORE INDI-
VIDUALS AS JOINT TENANTS OR TENANTS IN COMMON, AND ONE OR MORE THAN ONE
INDIVIDUAL IS NOT A MEMBER OF THE HOUSEHOLD, QUALIFYING REAL PROPERTY
TAXES IS THAT PART OF SUCH TAXES ON THE RESIDENCE WHICH REFLECTS THE
OWNERSHIP PERCENTAGE OF THE QUALIFIED TAXPAYER AND MEMBERS OF HIS OR HER
HOUSEHOLD. IF A RESIDENCE IS AN INTEGRAL PART OF A LARGER UNIT, QUALIFY-
ING REAL PROPERTY TAXES SHALL BE LIMITED TO THAT AMOUNT OF SUCH TAXES
PAID AS MAY BE REASONABLY APPORTIONED TO SUCH RESIDENCE. IF A HOUSEHOLD
OWNS AND OCCUPIES TWO OR MORE RESIDENCES DURING DIFFERENT PERIODS IN THE
SAME TAXABLE YEAR, QUALIFYING REAL PROPERTY TAXES SHALL BE THE SUM OF
THE PRORATED QUALIFYING REAL PROPERTY TAXES ATTRIBUTABLE TO THE HOUSE-
HOLD DURING THE PERIODS SUCH HOUSEHOLD OCCUPIES EACH OF SUCH RESIDENCES.
IF THE HOUSEHOLD OWNS AND OCCUPIES A RESIDENCE FOR PART OF THE TAXABLE
YEAR AND RENTS A RESIDENCE FOR PART OF THE SAME TAXABLE YEAR, IT MAY
INCLUDE THE PRORATION OF QUALIFYING REAL PROPERTY TAXES ON THE RESIDENCE
OWNED. PROVIDED, HOWEVER, FOR PURPOSES OF THE CREDIT ALLOWED UNDER THIS
SUBSECTION, QUALIFYING REAL PROPERTY TAXES MAY BE INCLUDED BY A QUALI-
FIED TAXPAYER ONLY TO THE EXTENT THAT SUCH TAXPAYER OR THE SPOUSE OF
SUCH TAXPAYER, OCCUPYING SUCH RESIDENCE FOR ONE HUNDRED EIGHTY-THREE
DAYS OR MORE OF THE TAXABLE YEAR, OWNS OR HAS OWNED THE RESIDENCE AND
PAID SUCH TAXES.
(2) A QUALIFIED TAXPAYER SHALL BE ALLOWED A CREDIT AS PROVIDED IN
PARAGRAPH THREE HEREOF AGAINST THE TAXES IMPOSED BY THIS ARTICLE REDUCED
BY THE CREDITS PERMITTED BY THIS ARTICLE. IF THE CREDIT EXCEEDS THE TAX
AS SO REDUCED FOR SUCH YEAR UNDER THIS ARTICLE, THE EXCESS SHALL BE
TREATED AS AN OVERPAYMENT, TO BE CREDITED OR REFUNDED, WITHOUT INTEREST.
IF A QUALIFIED TAXPAYER IS NOT REQUIRED TO FILE A RETURN PURSUANT TO
SECTION SIX HUNDRED FIFTY-ONE OF THIS ARTICLE, A QUALIFIED TAXPAYER MAY
NEVERTHELESS RECEIVE THE FULL AMOUNT OF THE CREDIT TO BE CREDITED OR
REFUNDED AS AN OVERPAYMENT, WITHOUT INTEREST.
S. 6359 184 A. 8559
(3) DETERMINATION OF CREDIT. (A) FOR TAXABLE YEARS BEGINNING IN TWO
THOUSAND FOURTEEN, THE AMOUNT OF THE CREDIT ALLOWABLE UNDER THIS
SUBSECTION SHALL BE DETERMINED AS FOLLOWS:
IF THE HOUSEHOLD EXCESS REAL PROPERTY THE CREDIT AMOUNT IS
GROSS INCOME FOR THE TAXES ARE THE EXCESS THE FOLLOWING
TAXABLE YEAR IS: OF QUALIFYING REAL PERCENTAGE OF THE
PROPERTY TAXES OVER EXCESS REAL PROPERTY
THE FOLLOWING TAXES:
PERCENTAGE OF
HOUSEHOLD GROSS INCOME:
LESS THAN $120,000 2.4% 6.25%
$120,000 TO LESS
THAN $150,000 3.2% 4.75%
$150,000 TO LESS
THAN $200,000 4.0% 3.25%
NOTWITHSTANDING THE FOREGOING PROVISIONS, THE MAXIMUM CREDIT DETER-
MINED UNDER THIS SUBPARAGRAPH MAY NOT EXCEED FIVE HUNDRED DOLLARS.
(B) FOR TAXABLE YEARS BEGINNING IN TWO THOUSAND FIFTEEN, THE AMOUNT OF
THE CREDIT ALLOWABLE UNDER THIS SUBSECTION SHALL BE DETERMINED AS
FOLLOWS:
IF THE HOUSEHOLD EXCESS REAL PROPERTY THE CREDIT AMOUNT IS
GROSS INCOME FOR THE TAXES ARE THE EXCESS THE FOLLOWING
TAXABLE YEAR IS: OF QUALIFYING REAL PERCENTAGE OF THE
PROPERTY TAXES OVER EXCESS REAL PROPERTY
THE FOLLOWING TAXES:
PERCENTAGE OF
HOUSEHOLD GROSS INCOME:
LESS THAN $120,000 3.0% 8.25%
$120,000 TO LESS
THAN $150,000 4.0% 6.00%
$150,000 TO LESS
THAN $200,000 5.0% 3.75%
NOTWITHSTANDING THE FOREGOING PROVISIONS, THE MAXIMUM CREDIT DETER-
MINED UNDER THIS SUBPARAGRAPH MAY NOT EXCEED SEVEN HUNDRED FIFTY
DOLLARS.
(C) FOR TAXABLE YEARS BEGINNING AFTER TWO THOUSAND FIFTEEN, THE AMOUNT
OF THE CREDIT ALLOWABLE UNDER THIS SUBSECTION SHALL BE DETERMINED AS
FOLLOWS:
IF THE HOUSEHOLD EXCESS REAL PROPERTY THE CREDIT AMOUNT IS
GROSS INCOME FOR THE TAXES ARE THE EXCESS THE FOLLOWING
TAXABLE YEAR IS: OF QUALIFYING REAL PERCENTAGE OF THE
PROPERTY TAXES OVER EXCESS REAL PROPERTY
THE FOLLOWING TAXES:
PERCENTAGE OF
HOUSEHOLD GROSS INCOME:
LESS THAN $120,000 3.0% 20.0%
$120,000 TO LESS
THAN $150,000 4.0% 15.0%
$150,000 TO LESS
THAN $200,000 5.0% 10.0%
NOTWITHSTANDING THE FOREGOING PROVISIONS, THE MAXIMUM CREDIT DETER-
MINED UNDER THIS SUBPARAGRAPH MAY NOT EXCEED ONE THOUSAND DOLLARS.
(4) IF A QUALIFIED TAXPAYER OCCUPIES A RESIDENCE FOR A PERIOD OF LESS
THAN TWELVE MONTHS DURING THE TAXABLE YEAR OR OCCUPIES TWO OR MORE RESI-
DENCES DURING DIFFERENT PERIODS IN SUCH TAXABLE YEAR, THE CREDIT ALLOWED
PURSUANT TO THIS SUBSECTION SHALL BE COMPUTED IN SUCH MANNER AS THE
S. 6359 185 A. 8559
COMMISSIONER MAY PRESCRIBE IN ORDER TO PROPERLY REFLECT THE CREDIT OR
PORTION THEREOF ATTRIBUTABLE TO SUCH RESIDENCE OR RESIDENCES AND SUCH
PERIOD OR PERIODS.
(5) THE COMMISSIONER MAY PRESCRIBE THAT THE CREDIT UNDER THIS
SUBSECTION SHALL BE DETERMINED IN WHOLE OR IN PART BY THE USE OF TABLES
PRESCRIBED BY SUCH COMMISSIONER. SUCH TABLES SHALL SET FORTH THE CREDIT
TO THE NEAREST DOLLAR.
(6) ONLY ONE CREDIT PER HOUSEHOLD AND PER QUALIFIED TAXPAYER SHALL BE
ALLOWED PER TAXABLE YEAR UNDER THIS SUBSECTION. WHEN TWO OR MORE MEMBERS
OF A HOUSEHOLD ARE ABLE TO MEET THE QUALIFICATIONS FOR A QUALIFIED
TAXPAYER, THE CREDIT SHALL BE EQUALLY DIVIDED BETWEEN OR AMONG SUCH
INDIVIDUALS UNLESS SUCH INDIVIDUALS FILE WITH THE COMMISSIONER A WRITTEN
AGREEMENT AMONG SUCH INDIVIDUALS SETTING FORTH A DIFFERENT DIVISION.
(A) PROVIDED, HOWEVER, WHERE A JOINT INCOME TAX RETURN HAS BEEN FILED
PURSUANT TO THE PROVISIONS OF SECTION SIX HUNDRED FIFTY-ONE OF THIS
ARTICLE BY A QUALIFIED TAXPAYER AND HIS OR HER SPOUSE (OR WHERE BOTH
SPOUSES ARE QUALIFIED TAXPAYERS AND HAVE FILED SUCH JOINT RETURN), THE
CREDIT, OR THE PORTION OF THE CREDIT IF DIVIDED, TO WHICH THE SPOUSES
ARE ENTITLED SHALL BE APPLIED AGAINST THE TAX OF BOTH SPOUSES AND ANY
OVERPAYMENT SHALL BE MADE TO BOTH SPOUSES.
(B) WHERE ANY RETURN REQUIRED TO BE FILED PURSUANT TO THE PROVISIONS
OF SECTION SIX HUNDRED FIFTY-ONE OF THIS ARTICLE IS COMBINED WITH ANY
RETURN OF TAX IMPOSED PURSUANT TO THE AUTHORITY OF THIS CHAPTER OR ANY
OTHER LAW IF SUCH TAX IS ADMINISTERED BY THE COMMISSIONER, THE CREDIT OR
THE PORTION OF THE CREDIT IF DIVIDED, ALLOWED TO THE QUALIFIED TAXPAYER
MAY BE APPLIED BY THE COMMISSIONER TOWARD ANY LIABILITY FOR THE AFORE-
MENTIONED TAXES.
(7) NO CREDIT SHALL BE GRANTED UNDER THIS SUBSECTION:
(A) IF HOUSEHOLD GROSS INCOME FOR THE TAXABLE YEAR EQUALS OR EXCEEDS
TWO HUNDRED THOUSAND DOLLARS.
(B) TO A PROPERTY OWNER UNLESS: (I) THE PROPERTY IS USED FOR RESIDEN-
TIAL PURPOSES, (II) NOT MORE THAN TWENTY PERCENT OF THE RENTAL INCOME,
IF ANY, FROM THE PROPERTY IS FROM RENTAL FOR NONRESIDENTIAL PURPOSES AND
(III) THE PROPERTY IS OCCUPIED AS A RESIDENCE IN WHOLE OR IN PART BY ONE
OR MORE OF THE OWNERS OF THE PROPERTY.
(C) TO AN INDIVIDUAL WITH RESPECT TO WHOM A DEDUCTION UNDER SUBSECTION
(C) OF SECTION ONE HUNDRED FIFTY-ONE OF THE INTERNAL REVENUE CODE IS
ALLOWABLE TO ANOTHER TAXPAYER FOR THE TAXABLE YEAR.
(D) WITH RESPECT TO A RESIDENCE THAT IS WHOLLY EXEMPTED FROM REAL
PROPERTY TAXATION.
(E) TO AN INDIVIDUAL WHO IS NOT A RESIDENT INDIVIDUAL OF THE STATE FOR
THE ENTIRE TAXABLE YEAR.
(8) THE RIGHT TO CLAIM A CREDIT OR THE PORTION OF A CREDIT, WHERE SUCH
CREDIT HAS BEEN DIVIDED UNDER THIS SUBSECTION, SHALL BE PERSONAL TO THE
QUALIFIED TAXPAYER AND SHALL NOT SURVIVE HIS OR HER DEATH, BUT SUCH
RIGHT MAY BE EXERCISED ON BEHALF OF A CLAIMANT BY HIS OR HER LEGAL GUAR-
DIAN OR ATTORNEY IN FACT DURING HIS OR HER LIFETIME.
(9) RETURNS. IF A QUALIFIED TAXPAYER IS NOT REQUIRED TO FILE A RETURN
PURSUANT TO SECTION SIX HUNDRED FIFTY-ONE OF THIS ARTICLE, A CLAIM FOR A
CREDIT MAY BE TAKEN ON A RETURN FILED WITH THE COMMISSIONER WITHIN THREE
YEARS FROM THE TIME IT WOULD HAVE BEEN REQUIRED THAT A RETURN BE FILED
PURSUANT TO SUCH SECTION HAD THE QUALIFIED TAXPAYER HAD A TAXABLE YEAR
ENDING ON DECEMBER THIRTY-FIRST. RETURNS UNDER THIS PARAGRAPH SHALL BE
IN SUCH FORM AS SHALL BE PRESCRIBED BY THE COMMISSIONER, WHO SHALL MAKE
AVAILABLE SUCH FORMS AND INSTRUCTIONS FOR FILING SUCH RETURNS.
S. 6359 186 A. 8559
(10) PROOF OF CLAIM. THE COMMISSIONER MAY REQUIRE A QUALIFIED TAXPAYER
TO FURNISH THE FOLLOWING INFORMATION IN SUPPORT OF HIS OR HER CLAIM FOR
CREDIT UNDER THIS SUBSECTION: HOUSEHOLD GROSS INCOME, REAL PROPERTY
TAXES LEVIED OR THAT WOULD HAVE BEEN LEVIED IN THE ABSENCE OF AN
EXEMPTION FROM REAL PROPERTY TAX PURSUANT TO SECTION FOUR HUNDRED
SIXTY-SEVEN OF THE REAL PROPERTY TAX LAW, THE NAMES OF MEMBERS OF THE
HOUSEHOLD AND OTHER QUALIFYING TAXPAYERS OCCUPYING THE SAME RESIDENCE
AND THEIR IDENTIFYING NUMBERS INCLUDING SOCIAL SECURITY NUMBERS, HOUSE-
HOLD GROSS INCOME, SIZE AND NATURE OF PROPERTY CLAIMED AS RESIDENCE AND
ALL OTHER INFORMATION WHICH MAY BE REQUIRED BY THE COMMISSIONER TO
DETERMINE THE CREDIT.
(11) ADMINISTRATION. THE PROVISIONS OF THIS ARTICLE, INCLUDING THE
PROVISIONS OF SECTION SIX HUNDRED FIFTY-THREE, SIX HUNDRED FIFTY-EIGHT,
AND SIX HUNDRED FIFTY-NINE AND THE PROVISIONS OF PART SIX OF THIS ARTI-
CLE RELATING TO PROCEDURE AND ADMINISTRATION, INCLUDING THE JUDICIAL
REVIEW OF THE DECISIONS OF THE COMMISSIONER, EXCEPT SO MUCH OF SECTION
SIX HUNDRED EIGHTY-SEVEN WHICH PERMITS A CLAIM FOR CREDIT OR REFUND TO
BE FILED AFTER THE PERIOD PROVIDED FOR IN PARAGRAPH NINE OF THIS
SUBSECTION AND EXCEPT SECTIONS SIX HUNDRED FIFTY-SEVEN, SIX HUNDRED
EIGHTY-EIGHT AND SIX HUNDRED NINETY-SIX, SHALL APPLY TO THE PROVISIONS
OF THIS SUBSECTION IN THE SAME MANNER AND WITH THE SAME FORCE AND EFFECT
AS IF THE LANGUAGE OF THOSE PROVISIONS HAD BEEN INCORPORATED IN FULL
INTO THIS SUBSECTION AND HAD EXPRESSLY REFERRED TO THE CREDIT ALLOWED OR
RETURNS FILED UNDER THIS SUBSECTION, EXCEPT TO THE EXTENT THAT ANY SUCH
PROVISION IS EITHER INCONSISTENT WITH A PROVISION OF THIS SUBSECTION OR
IS NOT RELEVANT TO THIS SUBSECTION. AS USED IN SUCH SECTIONS AND SUCH
PART, THE TERM "TAXPAYER" SHALL INCLUDE A QUALIFIED TAXPAYER UNDER THIS
SUBSECTION AND, NOTWITHSTANDING THE PROVISIONS OF SUBSECTION (E) OF
SECTION SIX HUNDRED NINETY-SEVEN, WHERE A QUALIFIED TAXPAYER HAS
PROTESTED THE DENIAL OF A CLAIM FOR CREDIT UNDER THIS SUBSECTION AND THE
TIME TO FILE A PETITION FOR REDETERMINATION OF A DEFICIENCY OR FOR
REFUND HAS NOT EXPIRED, HE OR SHE SHALL, SUBJECT TO SUCH CONDITIONS AS
MAY BE SET BY THE COMMISSIONER, RECEIVE SUCH INFORMATION (A) THAT IS
CONTAINED IN ANY RETURN FILED UNDER THIS ARTICLE BY A MEMBER OF HIS OR
HER HOUSEHOLD FOR THE TAXABLE YEAR FOR WHICH THE CREDIT IS CLAIMED, AND
(B) THAT THE COMMISSIONER FINDS IS RELEVANT AND MATERIAL TO THE ISSUE OF
WHETHER SUCH CLAIM WAS PROPERLY DENIED.
(12) NOTWITHSTANDING ANY OTHER PROVISION OF THIS ARTICLE, THE CREDIT
ALLOWED UNDER THIS SUBSECTION SHALL BE DETERMINED AFTER THE DETERMI-
NATION AND APPLICATION OF ANY OTHER CREDITS PERMITTED UNDER THE
PROVISIONS OF THIS ARTICLE. A TAXPAYER SHALL BE ALLOWED EITHER THE
CREDIT PROVIDED BY THIS SUBSECTION OR THE REAL PROPERTY TAX CIRCUIT
BREAKER CREDIT PROVIDED BY SUBSECTION (E) OF THIS SECTION, WHICHEVER IS
GREATER.
S 3. Paragraph 14 of subsection (e) of section 606 of the tax law is
REPEALED.
S 4. This act shall take effect immediately and shall apply to taxable
years beginning on or after January 1, 2014.
PART L
Section 1. Section 606 of the tax law is amended by adding a new
subsection (b-1) to read as follows:
(B-1) RENTERS' CREDIT.
(1) FOR THE PURPOSES OF THIS SUBSECTION:
S. 6359 187 A. 8559
(A) "QUALIFIED TAXPAYER" MEANS A RESIDENT INDIVIDUAL OF THE STATE WHO
HAS OCCUPIED AND PAID RENT FOR HIS OR HER PRIMARY RESIDENCE IN THIS
STATE FOR SIX MONTHS OR MORE OF THE TAXABLE YEAR, IS REQUIRED OR CHOOSES
TO FILE A RETURN UNDER THIS ARTICLE, AND (I) IS SIXTY-FIVE YEARS OF AGE
OR OLDER, (II) IS FILING A JOINT RETURN WITH A SPOUSE WHO IS SIXTY-FIVE
YEARS OF AGE OR OLDER, (III) IS A HEAD OF HOUSEHOLD, (IV) IS A MARRIED
INDIVIDUAL FILING A JOINT RETURN WITH A SPOUSE AND HAS AT LEAST ONE
DEPENDENT, (V) IS A MARRIED INDIVIDUAL FILING A SEPARATE RETURN AND HAS
AT LEAST ONE DEPENDENT, OR (VI) IS A SURVIVING SPOUSE AND HAS AT LEAST
ONE DEPENDENT. AN INDIVIDUAL CANNOT BE A QUALIFIED TAXPAYER IF HE OR SHE
IS AN INDIVIDUAL WITH RESPECT TO WHOM A DEDUCTION UNDER SUBSECTION (C)
OF SECTION 151 OF THE INTERNAL REVENUE CODE IS ALLOWABLE TO ANOTHER
TAXPAYER FOR THE TAXABLE YEAR OR PAYS RENT FOR HIS OR HER PRIMARY RESI-
DENCE TO A FAMILY MEMBER SHARING THE SAME PRIMARY RESIDENCE. A FAMILY
MEMBER OF AN INDIVIDUAL IS THE INDIVIDUAL'S SPOUSE, BROTHER, SISTER,
PARENT, GRANDPARENT, CHILD, GRANDCHILD, UNCLE, AUNT, NEPHEW, OR NIECE,
RELATED TO THE INDIVIDUAL BY BLOOD, MARRIAGE OR ADOPTION.
(B) "RESIDENCE" MEANS A DWELLING IN THIS STATE AND MAY CONSIST OF A
PART OF A MULTI-DWELLING OR MULTI-PURPOSE BUILDING INCLUDING A COOPER-
ATIVE OR CONDOMINIUM, AND RENTAL UNITS WITHIN A SINGLE DWELLING. RESI-
DENCE INCLUDES A TRAILER OR MOBILE HOME, USED EXCLUSIVELY FOR RESIDEN-
TIAL PURPOSES AND DEFINED AS REAL PROPERTY PURSUANT TO PARAGRAPH (G) OF
SUBDIVISION TWELVE OF SECTION ONE HUNDRED TWO OF THE REAL PROPERTY TAX
LAW.
(2) (A) A QUALIFIED TAXPAYER SHALL BE ALLOWED A CREDIT AS PROVIDED IN
THIS SUBSECTION AGAINST THE TAXES IMPOSED BY THIS ARTICLE REDUCED BY THE
CREDITS PERMITTED BY THIS ARTICLE. IF THE CREDIT EXCEEDS THE TAX AS SO
REDUCED FOR SUCH YEAR UNDER THIS ARTICLE, THE EXCESS SHALL BE TREATED AS
AN OVERPAYMENT OF TAX TO BE CREDITED OR REFUNDED IN ACCORDANCE WITH THE
PROVISIONS OF SECTION SIX HUNDRED EIGHTY-SIX OF THIS ARTICLE, PROVIDED,
HOWEVER, THAT NO INTEREST SHALL BE PAID THEREON. IF A QUALIFIED TAXPAYER
IS NOT REQUIRED TO FILE A RETURN PURSUANT TO SECTION SIX HUNDRED FIFTY-
ONE OF THIS ARTICLE BUT OTHERWISE QUALIFIES FOR A CREDIT UNDER THIS
SUBSECTION, A CLAIM FOR A CREDIT MAY BE TAKEN ON A RETURN FILED WITH THE
COMMISSIONER WITHIN THREE YEARS FROM THE TIME THAT A RETURN WOULD HAVE
BEEN REQUIRED TO BE FILED PURSUANT TO SUCH SECTION HAD SUCH QUALIFIED
TAXPAYER HAD A TAXABLE YEAR ENDING ON DECEMBER THIRTY-FIRST. RETURNS
SHALL BE IN SUCH FORM AS PRESCRIBED BY THE COMMISSIONER. A QUALIFIED
TAXPAYER MUST PROVIDE ANY INFORMATION THE COMMISSIONER DEEMS NECESSARY
TO DETERMINE THE CREDIT ALLOWED.
(B) IF MORE THAN ONE QUALIFIED TAXPAYER PAYS RENT FOR THE SAME PRIMARY
RESIDENCE AND HAS A FEDERAL ADJUSTED GROSS INCOME FOR WHICH A CREDIT
WOULD OTHERWISE BE DUE, EACH SUCH QUALIFIED TAXPAYER SHALL DIVIDE THE
BASE AMOUNT OF THE CREDIT ALLOWED FOR HIS OR HER INCOME LEVEL BY THE
TOTAL NUMBER OF INDIVIDUALS OR MARRIED COUPLES FILING A JOINT RETURN WHO
ARE PAYING THE RENT, WHETHER OR NOT ELIGIBLE FOR A CREDIT, TO DETERMINE
THE AMOUNT OF CREDIT ALLOWED TO THAT QUALIFIED TAXPAYER. ANY ADDITIONAL
AMOUNT OF CREDIT DETERMINED BASED ON THE NUMBER OF EXEMPTIONS CLAIMED BY
SUCH TAXPAYER SHALL NOT BE SO DIVIDED.
(C) A QUALIFIED TAXPAYER SHALL BE ALLOWED THE CREDIT UNDER THIS
SUBSECTION OR THE CREDIT UNDER SUBSECTION (E) OF THIS SECTION, WHICHEVER
IS THE HIGHER AMOUNT.
(3) (A) FOR ANY QUALIFIED TAXPAYER WHO IS SIXTY-FIVE YEARS OF AGE OR
OLDER WITH A FILING STATUS OF SINGLE, THE AMOUNT OF THE CREDIT ALLOWED
PURSUANT TO THIS PARAGRAPH SHALL BE DETERMINED IN ACCORDANCE WITH THE
FOLLOWING TABLES:
S. 6359 188 A. 8559
FOR TAXABLE YEARS BEGINNING IN 2014,
IF FEDERAL ADJUSTED GROSS INCOME IS: THE CREDIT SHALL BE:
$25,000 OR LESS $110
OVER $25,000 BUT NOT OVER $40,000 $90
OVER $40,000 BUT NOT OVER $50,000 $70
FOR TAXABLE YEARS BEGINNING IN OR
AFTER 2015, IF FEDERAL ADJUSTED GROSS
INCOME IS: THE CREDIT SHALL BE:
$25,000 OR LESS $220
OVER $25,000 BUT NOT OVER $40,000 $180
OVER $40,000 BUT NOT OVER $50,000 $140
(B) FOR ANY OTHER QUALIFIED TAXPAYER, THE AMOUNT OF THE CREDIT ALLOWED
PURSUANT TO THIS PARAGRAPH SHALL BE DETERMINED IN ACCORDANCE WITH THE
FOLLOWING TABLES; PROVIDED, HOWEVER, THAT A QUALIFIED TAXPAYER WHO IS A
MARRIED INDIVIDUAL FILING A SEPARATE NEW YORK INCOME TAX RETURN SHALL
RECEIVE ONE-HALF OF THE BASE AMOUNT OF THE CREDIT PLUS ANY ADDITIONAL
AMOUNT FOR WHICH SUCH TAXPAYER WOULD BE ELIGIBLE BASED ON THE INCOME AND
NUMBER OF EXEMPTIONS CLAIMED BY SUCH TAXPAYER:
FOR TAXABLE YEARS BEGINNING IN 2014,
IF FEDERAL ADJUSTED GROSS INCOME IS: THE CREDIT SHALL BE:
$25,000 OR LESS $80 PLUS AN AMOUNT
EQUAL TO $35
MULTIPLIED BY A
NUMBER WHICH IS ONE
LESS THAN THE NUMBER
OF EXEMPTIONS FOR
WHICH THE TAXPAYER
(OR IN THE CASE
OF A MARRIED COUPLE
FILING A JOINT RETURN,
TAXPAYERS) IS ENTITLED
TO A DEDUCTION FOR THE
TAXABLE YEAR FOR FEDERAL
INCOME TAX PURPOSES
UNDER SUBSECTIONS (B)
AND (C) OF SECTION 151
OF THE INTERNAL REVENUE CODE
OVER $25,000 BUT NOT OVER $45,000 $65 PLUS AN AMOUNT
EQUAL TO $24
MULTIPLIED BY A NUMBER
WHICH IS ONE LESS THAN
THE NUMBER OF EXEMPTIONS
FOR WHICH THE TAXPAYER
(OR IN THE CASE OF
A MARRIED COUPLE FILING A
JOINT RETURN, TAXPAYERS)
IS ENTITLED TO A
DEDUCTION FOR THE TAXABLE
YEAR FOR FEDERAL INCOME
TAX PURPOSES UNDER
SUBSECTIONS (B) AND (C)
OF SECTION 151 OF THE
INTERNAL REVENUE CODE
S. 6359 189 A. 8559
OVER $45,000 BUT NOT OVER $65,000 $55 PLUS AN AMOUNT
EQUAL TO $12 MULTIPLIED
BY A NUMBER WHICH IS ONE
LESS THAN THE NUMBER
OF EXEMPTIONS FOR
WHICH THE TAXPAYER (OR
IN THE CASE OF A MARRIED
COUPLE FILING A JOINT RETURN,
TAXPAYERS) IS ENTITLED
TO A DEDUCTION FOR THE
TAXABLE YEAR FOR FEDERAL
INCOME TAX PURPOSES UNDER
SUBSECTIONS (B) AND (C)
OF SECTION 151 OF THE
INTERNAL REVENUE CODE
OVER $65,000 BUT NOT OVER $100,000 $45 PLUS AN AMOUNT
EQUAL TO $12 MULTIPLIED
BY A NUMBER WHICH IS ONE
LESS THAN THE NUMBER
OF EXEMPTIONS FOR WHICH
THE TAXPAYER (OR IN THE
CASE OF A MARRIED COUPLE
FILING A JOINT RETURN,
TAXPAYERS) IS ENTITLED TO
A DEDUCTION FOR THE TAXABLE
YEAR FOR FEDERAL INCOME TAX
PURPOSES UNDER SUBSECTIONS
(B) AND (C) OF SECTION 151
OF THE INTERNAL REVENUE CODE
FOR TAXABLE YEARS BEGINNING IN OR
AFTER 2015, IF FEDERAL ADJUSTED GROSS
INCOME IS: THE CREDIT SHALL BE:
$25,000 OR LESS $160 PLUS AN
AMOUNT EQUAL TO $70
MULTIPLIED BY A NUMBER WHICH
IS ONE LESS THAN THE
NUMBER OF EXEMPTIONS
FOR WHICH THE TAXPAYER
(OR IN THE CASE OF A
MARRIED COUPLE FILING A
JOINT RETURN, TAXPAYERS)
IS ENTITLED TO A DEDUCTION
FOR THE TAXABLE YEAR FOR
FEDERAL INCOME TAX PURPOSES
UNDER SUBSECTIONS (B) AND
(C) OF SECTION 151 OF THE
INTERNAL REVENUE CODE
OVER $25,000 BUT NOT OVER $45,000 $130 PLUS AN AMOUNT
EQUAL TO $48
MULTIPLIED BY A NUMBER
WHICH IS ONE LESS THAN
THE NUMBER OF EXEMPTIONS
FOR WHICH THE TAXPAYER
S. 6359 190 A. 8559
(OR IN THE CASE OF
A MARRIED COUPLE FILING
A JOINT RETURN, TAXPAYERS)
IS ENTITLED TO A DEDUCTION
FOR THE TAXABLE YEAR FOR
FEDERAL INCOME TAX PURPOSES
UNDER SUBSECTIONS (B)
AND (C) OF SECTION 151
OF THE INTERNAL REVENUE CODE
OVER $45,000 BUT NOT OVER $65,000 $110 PLUS AN AMOUNT
EQUAL TO $24 MULTIPLIED
BY A NUMBER WHICH IS ONE
LESS THAN THE NUMBER
OF EXEMPTIONS FOR
WHICH THE TAXPAYER (OR
IN THE CASE OF A MARRIED
COUPLE FILING A JOINT RETURN,
TAXPAYERS) IS ENTITLED TO A
DEDUCTION FOR THE TAXABLE
YEAR FOR FEDERAL INCOME TAX
PURPOSES UNDER SUBSECTIONS
(B) AND (C) OF SECTION 151
OF THE INTERNAL REVENUE CODE
OVER $65,000 BUT NOT OVER $100,000 $90 PLUS AN AMOUNT
EQUAL TO $24 MULTIPLIED
BY A NUMBER WHICH IS ONE
LESS THAN THE NUMBER
OF EXEMPTIONS FOR
WHICH THE TAXPAYER (OR
IN THE CASE OF A MARRIED
COUPLE FILING A JOINT RETURN,
TAXPAYERS) IS
ENTITLED TO A DEDUCTION
FOR THE TAXABLE YEAR FOR
FEDERAL INCOME TAX PURPOSES
UNDER SUBSECTIONS (B) AND
(C) OF SECTION 151 OF THE
INTERNAL REVENUE CODE
S 2. This act shall take effect immediately.
PART M
Section 1. Paragraphs 2, 4 and 5 of subsection (vv) of section 606 of
the tax law, as added by section 1 of part CC of chapter 59 of the laws
of 2013, are amended to read as follows:
2. To be eligible for the credit, the taxpayer (or taxpayers filing
joint returns) on the personal income tax return filed for the taxable
year [two years prior], must [have] (a) [been] BE a resident, (b)
[claimed] CLAIM one or more dependent children who were under the age of
seventeen on the last day of the taxable year, (c) [had] HAVE New York
adjusted gross income of at least forty thousand dollars but no greater
than three hundred thousand dollars, and (d) [had] HAVE a tax liability
as determined under paragraph three of this subsection of greater than
or equal to zero.
S. 6359 191 A. 8559
4. [For each year this credit is allowed, on or before October
fifteenth of such year, the commissioner shall determine the taxpayer's
eligibility for this credit utilizing the information available to the
commissioner on the taxpayer's personal income tax return filed for the
taxable year two years prior to the taxable year in which the credit is
allowed. For those taxpayers whom the commissioner has determined eligi-
ble for this credit, the commissioner shall advance a payment of three
hundred fifty dollars. When a taxpayer files his or her return for the
taxable year, such taxpayer shall properly reconcile that payment on his
or her return.
5.] If the amount of the credit allowed under this subsection shall
exceed the taxpayer's tax for the taxable year, the excess shall be
treated as an overpayment of tax to be credited or refunded in accord-
ance with the provisions of SECTION six hundred eighty-six of this arti-
cle, provided, however, that no interest shall be paid thereon.
S 2. This act shall take effect immediately and apply to taxable years
beginning on or after January 1, 2015.
PART N
Section 1. Paragraph 1 of subsection (a) of section 651 of the tax
law, as amended by chapter 333 of the laws of 1987, is amended to read
as follows:
(1) every resident individual (A) required to file a federal income
tax return for the taxable year, or (B) having federal adjusted gross
income for the taxable year, increased by the modifications under
subsection (b) of section six hundred twelve OF THIS ARTICLE, in excess
of [four thousand dollars, or in excess of] his OR HER New York standard
deduction, [if lower,] or (C) subject to tax under section six hundred
two OF THIS ARTICLE, or (D) having received during the taxable year a
lump sum distribution any portion of which is subject to tax under
section six hundred three OF THIS ARTICLE;
S 2. This act shall take effect immediately and apply to taxable years
beginning on or after January 1, 2014.
PART O
Section 1. Paragraph 1 of subdivision (a) of section 28 of the tax
law, as amended by section 1 of part I of chapter 59 of the laws of
2012, is amended to read as follows:
(1) A taxpayer which is a qualified commercial production company, or
which is a sole proprietor of a qualified commercial production company,
and which is subject to tax under article nine-A or twenty-two of this
chapter, shall be allowed a credit against such tax, pursuant to the
provisions referenced in subdivision (c) of this section, to be computed
as provided in this section. Provided, however, to be eligible for such
credit, at least seventy-five percent of the production costs (excluding
post production costs) paid or incurred directly and predominantly in
the actual filming or recording of the qualified commercial must be
costs incurred in New York state. The tax credit allowed pursuant to
this section shall apply to taxable years beginning before January
first, two thousand [fifteen] SEVENTEEN.
S 2. Paragraph (a) of subdivision 38 of section 210 of the tax law, as
amended by section 3 of part I of chapter 59 of the laws of 2012, is
amended to read as follows:
S. 6359 192 A. 8559
(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. The tax credit allowed pursuant to this section
shall apply to taxable years beginning before January first, two thou-
sand [fifteen] SEVENTEEN.
S 3. Paragraph 1 of subsection (jj) of section 606 of the tax law, as
amended by section 4 of part I of chapter 59 of the laws of 2012, is
amended to read as follows:
(1) Allowance of credit. A taxpayer that is eligible pursuant to the
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. The tax credit allowed pursuant to this section
shall apply to taxable years beginning before January first, two thou-
sand [fifteen] SEVENTEEN.
S 4. This act shall take effect immediately.
PART P
Section 1. Subdivision 4 of section 22 of the public housing law, as
amended by section 2 of part J of chapter 59 of the laws of 2012, is
amended to read as follows:
4. Statewide limitation. The aggregate dollar amount of credit which
the commissioner may allocate to eligible low-income buildings under
this article shall be [forty-eight] FIFTY-SIX million dollars. The limi-
tation provided by this subdivision applies only to allocation of the
aggregate dollar amount of credit by the commissioner, and does not
apply to allowance to a taxpayer of the credit with respect to an eligi-
ble low-income building for each year of the credit period.
S 2. Subdivision 4 of section 22 of the public housing law, as amended
by section one of this act, is amended to read as follows:
4. Statewide limitation. The aggregate dollar amount of credit which
the commissioner may allocate to eligible low-income buildings under
this article shall be [fifty-six] SIXTY-FOUR million dollars. The limi-
tation provided by this subdivision applies only to allocation of the
aggregate dollar amount of credit by the commissioner, and does not
apply to allowance to a taxpayer of the credit with respect to an eligi-
ble low-income building for each year of the credit period.
S 3. This act shall take effect immediately; provided, however, that
section two of this act shall take effect April 1, 2015.
PART Q
Section 1. Subdivision (b) of section 27-1318 of the environmental
conservation law, as amended by section 2 of part E of chapter 577 of
the laws of 2004, is amended to read as follows:
(b) Within [sixty] ONE HUNDRED EIGHTY days of commencement of the
remedial design, the owner of an inactive hazardous waste disposal site,
and/or any person responsible for implementing a remedial program at
such site, where institutional or engineering controls are employed
pursuant to this title, shall execute an environmental easement pursuant
to title thirty-six of article seventy-one of this chapter.
S 2. Subdivision 2 of section 27-1405 of the environmental conserva-
tion law, as amended by section 2 of part A of chapter 577 of the laws
of 2004, is amended to read as follows:
S. 6359 193 A. 8559
2. "Brownfield site" or "site" shall mean any real property[, the
redevelopment or reuse of which may be complicated by the presence or
potential presence of] WHERE a contaminant IS PRESENT AT LEVELS EXCEED-
ING THE SOIL CLEANUP OBJECTIVES OR OTHER HEALTH-BASED OR ENVIRONMENTAL
STANDARDS PROMULGATED BY THE DEPARTMENT THAT ARE APPLICABLE BASED ON THE
REASONABLY ANTICIPATED USE OF THE PROPERTY, AS DETERMINED BY THE DEPART-
MENT. Such term shall not include real property:
(a) listed in the registry of inactive hazardous waste disposal sites
under section 27-1305 of this article at the time of application to this
program and given a classification as described in subparagraph one or
two of paragraph b of subdivision two of section 27-1305 of this arti-
cle; provided, however [except until July first, two thousand five],
real property listed in the registry of inactive hazardous waste
disposal sites under subparagraph two of paragraph b of subdivision two
of section 27-1305 of this article [prior to the effective date of this
article], where such real property is owned by a volunteer OR UNDER
CONTRACT TO BE TRANSFERRED TO A VOLUNTEER AND THE DEPARTMENT HAS NOT
IDENTIFIED ANY RESPONSIBLE PARTIES FOR THAT PROPERTY HAVING THE ABILITY
TO PAY FOR THE INVESTIGATION OR CLEANUP OF THE PROPERTY, shall not be
deemed ineligible to participate and further provided that the status of
any such site as listed in the registry shall not be altered prior to
the issuance of a certificate of completion pursuant to section 27-1419
of this title. THE DEPARTMENT'S ASSESSMENT OF ELIGIBILITY UNDER THIS
PARAGRAPH SHALL NOT CONSTITUTE A FINDING CONCERNING LIABILITY WITH
RESPECT TO THE PROPERTY;
(b) listed on the national priorities list established under authority
of 42 U.S.C. section 9605;
(c) subject to an enforcement action under title seven or nine of this
article, [except] OR PERMITTED AS a treatment, storage or disposal
facility [subject to a permit]; provided, that nothing herein contained
shall be deemed otherwise to exclude from the scope of the term "brown-
field site" a hazardous waste treatment, storage or disposal facility
having interim status according to regulations promulgated by the
commissioner;
(d) subject to an order for cleanup pursuant to article twelve of the
navigation law or pursuant to title ten of article seventeen of this
chapter except such property shall not be deemed ineligible if it is
subject to a stipulation agreement; or
(e) subject to any other on-going state or federal environmental
enforcement action related to the contamination which is at or emanating
from the site subject to the present application.
S 3. Subdivision 1 of section 27-1407 of the environmental conserva-
tion law, as amended by section 3 of part A of chapter 577 of the laws
of 2004, is amended and a new subdivision 1-a is added to read as
follows:
1. A person who seeks to participate in this program shall submit a
request to the department on a form provided by the department. Such
form shall include information to be determined by the department suffi-
cient to allow the department to determine eligibility and the current,
intended and reasonably anticipated future land use of the site pursuant
to section 27-1415 of this title. ANY SUCH PERSON SHALL SUBMIT AN
INVESTIGATION REPORT SUFFICIENT TO DEMONSTRATE THAT THE SITE REQUIRES
REMEDIATION IN ORDER TO MEET THE REMEDIAL REQUIREMENTS OF THIS TITLE;
AND, FOR ANY STRATEGIC SITE LOCATED WITHIN A BROWNFIELD OPPORTUNITY AREA
DESIGNATED BY THE SECRETARY OF STATE PURSUANT TO SECTION NINE HUNDRED
SEVENTY-R OF THE GENERAL MUNICIPAL LAW, A CERTIFICATION THAT THE DEVEL-
S. 6359 194 A. 8559
OPMENT OF THE SITE WILL BE IN CONFORMANCE WITH SUCH BROWNFIELD OPPORTU-
NITY AREA PLAN.
1-A. IF THE PERSON IS ALSO SEEKING TO RECEIVE THE TANGIBLE PROPERTY
CREDIT COMPONENT OF THE BROWNFIELD REDEVELOPMENT TAX CREDIT PURSUANT TO
PARAGRAPH THREE OF SUBDIVISION (A) OF SECTION TWENTY-ONE OF THE TAX LAW
SUCH PERSON SHALL SUBMIT INFORMATION SUFFICIENT TO DEMONSTRATE THAT (1)
THE SITE HAS: (I) BEEN A VACANT LOT FOR FIFTEEN OR MORE YEARS, OR (II) A
BUILDING OR BUILDINGS THAT HAVE BEEN VACANT FOR FIFTEEN OR MORE YEARS,
OR (III) A LOT OR BUILDINGS HAVE BEEN BOTH VACANT AND TAX DELINQUENT FOR
TEN OR MORE YEARS, (2) THE PROJECTED COST OF THE INVESTIGATION AND REME-
DIATION WHICH IS PROTECTIVE FOR THE ANTICIPATED USE OF THE SITE EXCEEDS
THE CERTIFIED APPRAISED VALUE OF THE PROPERTY ABSENT CONTAMINATION, OR
(3) THE PROJECT IS A PRIORITY ECONOMIC DEVELOPMENT PROJECT AS DETERMINED
BY THE DEPARTMENT OF ECONOMIC DEVELOPMENT THAT HAS RECEIVED A RESOLUTION
FROM THE MUNICIPALITY WITHIN WHICH THE SITE IS LOCATED STATING THE
PROPOSED PROJECT IS CONSISTENT WITH THE MUNICIPALITY'S LOCAL REVITALIZA-
TION OR DEVELOPMENT PLAN. "PRIORITY ECONOMIC DEVELOPMENT PROJECT" MEANS
(A) A MANUFACTURER CREATING AT LEAST ONE HUNDRED NET NEW JOBS IN THE
STATE AND MAKING SIGNIFICANT CAPITAL INVESTMENT IN THE STATE; (B) A
BUSINESS CREATING AT LEAST ONE HUNDRED NET NEW JOBS IN AGRICULTURE IN
THE STATE AND MAKING SIGNIFICANT CAPITAL INVESTMENT IN THE STATE; (C) A
FINANCIAL SERVICES FIRM, DISTRIBUTION CENTER, OR BACK OFFICE OPERATION
CREATING AT LEAST THREE HUNDRED NET NEW JOBS IN THE STATE AND MAKING
SIGNIFICANT CAPITAL INVESTMENT IN THE STATE; (D) A SCIENTIFIC RESEARCH
AND DEVELOPMENT FIRM CREATING AT LEAST ONE HUNDRED NET NEW JOBS IN THE
STATE, AND MAKING SIGNIFICANT CAPITAL INVESTMENT IN THE STATE; (E) THE
CORPORATE HEADQUARTERS OF A FIRM CREATING AT LEAST ONE HUNDRED NET NEW
JOBS IN THE STATE, AND MAKING SIGNIFICANT CAPITAL INVESTMENT IN THE
STATE; OR (F) A SOFTWARE DEVELOPMENT OR NEW MEDIA FIRM CREATING AT LEAST
FIFTY NET NEW JOBS IN THE STATE, AND MAKING SIGNIFICANT CAPITAL INVEST-
MENT IN THE STATE. OTHER BUSINESSES CREATING THREE HUNDRED OR MORE NET
NEW JOBS IN THE STATE AND MAKING SIGNIFICANT CAPITAL INVESTMENT IN THE
STATE MAY BE CONSIDERED ELIGIBLE AS PRIORITY ECONOMIC DEVELOPMENT
PROJECT BY THE COMMISSIONER OF ECONOMIC DEVELOPMENT AS WELL. AN APPLI-
CANT MAY REQUEST AN ELIGIBILITY DETERMINATION FOR TANGIBLE PROPERTY
CREDITS FROM THE COMMISSIONER OF ECONOMIC DEVELOPMENT FOR A PRIORITY
ECONOMIC DEVELOPMENT PROJECT WHEN IT CAN DEMONSTRATE THAT IT MEETS SUCH
CRITERIA ANY TIME FROM APPLICATION TO THREE YEARS FROM THE DATE THE SITE
RECEIVES A CERTIFICATE OF COMPLETION PURSUANT TO SECTION 27-1419 OF THIS
TITLE. THE COMMISSIONER OF ECONOMIC DEVELOPMENT SHALL PROMULGATE REGU-
LATIONS TO DETERMINE WHAT CONSTITUTES SIGNIFICANT CAPITAL INVESTMENT FOR
EACH OF THE PROJECT CATEGORIES INDICATED IN THIS SUBDIVISION AND WHAT
ADDITIONAL CRITERIA A BUSINESS MUST MEET TO BE ELIGIBLE AS A PRIORITY
ECONOMIC DEVELOPMENT PROJECT.
SITES ARE NOT ELIGIBLE FOR TANGIBLE PROPERTY TAX CREDITS IF (1) THE
CONTAMINATION IS SOLELY EMANATING FROM PROPERTY OTHER THAN THE SITE
SUBJECT TO THE PRESENT APPLICATION; OR (2) THE DEPARTMENT HAS DETERMINED
THAT THE PROPERTY HAS PREVIOUSLY BEEN REMEDIATED SUCH THAT IT MAY BE
DEVELOPED FOR ITS THEN INTENDED USE.
S 4. Subdivision 3 of section 27-1407 of the environmental conserva-
tion law, as amended by section 3 of part A of chapter 577 of the laws
of 2004, is amended to read as follows:
3. The department shall notify the person requesting participation in
this program within [ten] THIRTY days after receiving such request that
such request is either complete or incomplete. In the event the applica-
tion is determined to be incomplete the department shall specify in
S. 6359 195 A. 8559
writing the missing necessary information required pursuant to this
article to complete the application and shall have ten days after
receipt of the missing information to issue a written determination if
the application is complete.
S 5. Subdivision 6 of section 27-1407 of the environmental conserva-
tion law, as added by section 1 of part A of chapter 1 of the laws of
2003, is amended to read as follows:
6. The department shall use all best efforts to expeditiously notify
the applicant within forty-five days after receiving [their request] A
COMPLETE APPLICATION for participation that such request is either
accepted or rejected, AND, FOR ANY APPLICANT SEEKING TO RECEIVE THE
TANGIBLE PROPERTY CREDIT COMPONENT OF THE BROWNFIELD REDEVELOPMENT TAX
CREDIT PURSUANT TO PARAGRAPH THREE OF SUBDIVISION (A) OF SECTION TWEN-
TY-ONE OF THE TAX LAW, WHETHER THE CRITERIA FOR RECEIVING SUCH COMPONENT
AS SET FORTH IN SUBDIVISION ONE OF THIS SECTION HAVE BEEN MET.
S 6. Subdivision 9 of section 27-1407 of the environmental conserva-
tion law is amended by adding a new paragraph (g) to read as follows:
(G) THE PERSON'S PARTICIPATION IN ANY REMEDIAL PROGRAM UNDER THE
DEPARTMENT'S OVERSIGHT WAS TERMINATED BY THE DEPARTMENT OR BY A COURT
FOR FAILURE TO SUBSTANTIALLY COMPLY WITH AN AGREEMENT OR ORDER.
S 7. Subdivision 2 of section 27-1409 of the environmental conserva-
tion law, as amended by section 4 of part A of chapter 577 of the laws
of 2004, is amended to read as follows:
2. One requiring (A) the [applicant] PARTICIPANT to pay for state
costs, INCLUDING THE RECOVERY OF STATE COSTS INCURRED BEFORE THE EFFEC-
TIVE DATE OF SUCH AGREEMENT; provided, however, that SUCH COSTS MAY BE
BASED ON A REASONABLE FLAT-FEE FOR OVERSIGHT, WHICH SHALL REFLECT THE
PROJECTED FUTURE STATE COSTS INCURRED IN NEGOTIATING AND OVERSEEING
IMPLEMENTATION OF SUCH AGREEMENT; AND
(B) with respect to a brownfield site which the department has deter-
mined constitutes a significant threat to the public health or environ-
ment the department may include a provision requiring the applicant to
provide a technical assistance grant, as described in subdivision four
of section 27-1417 of this title and under the conditions described
therein, to an eligible party in accordance with procedures established
under such program, with the cost of such a grant incurred by a volun-
teer serving as an offset against such state costs[. Where the applicant
is a participant, the department shall include provisions relating to
recovery of state costs incurred before the effective date of such
agreement];
S 8. Section 27-1411 of the environmental conservation law is amended
by adding two new subdivisions 6 and 7 to read as follows:
6. AN APPLICANT SHALL COMMENCE IMPLEMENTATION OF ANY WORK PLAN WITHIN
NINETY DAYS OF APPROVAL OF THE PLAN BY THE DEPARTMENT AND COMPLETE THE
ACTIVITIES PROVIDED FOR IN SUCH WORK PLAN IN ACCORDANCE WITH THE SCHED-
ULE SET FORTH THEREIN, OR AS OTHERWISE APPROVED BY THE DEPARTMENT IN
WRITING.
7. AN APPLICANT SHALL INCLUDE WITH EVERY REPORT SUBMITTED TO THE
DEPARTMENT A SCHEDULE FOR THE SUBMISSION OF ANY SUBSEQUENT WORK PLAN
REQUIRED TO MEET THE REQUIREMENTS OF THIS TITLE.
S 9. Subdivision 2 of section 27-1413 of the environmental conserva-
tion law, as amended by section 6 of part A of chapter 577 of the laws
of 2004, is amended to read as follows:
2. For all [other] sites SEEKING TO RECEIVE THE TANGIBLE PROPERTY
CREDIT COMPONENT PURSUANT TO PARAGRAPH THREE OF SUBDIVISION (A) OF
SECTION TWENTY-ONE OF THE TAX LAW, the applicant shall develop and eval-
S. 6359 196 A. 8559
uate at least two remedial alternatives, one of which would achieve a
Track 1 cleanup. The department shall have the discretion to require the
evaluation of additional alternatives at a site that has been determined
to pose a significant threat. The applicant shall submit the alterna-
tives analysis [as a part of the remedial work plan] to the department
for review, approval, modification or rejection.
S 10. Subdivision 4 of section 27-1415 of the environmental conserva-
tion law, as amended by section 7 of part A of chapter 577 of the laws
of 2004, is amended to read as follows:
4. Tracks. The commissioner, in consultation with the commissioner of
health, shall propose within twelve months and thereafter timely promul-
gate regulations which create a multi-track approach for the remediation
of contamination, and, commencing on the effective date of such regu-
lations, utilize such multi-track approach. Such regulations shall
provide that groundwater use in Tracks 2, 3 or 4 can be either
restricted or unrestricted. The tracks shall be as follows:
Track 1: The remedial program shall achieve a cleanup level that will
allow the site to be used for any purpose without restriction and with-
out reliance on the long-term employment of institutional or engineering
controls, and shall achieve contaminant-specific remedial action objec-
tives for soil which conform with those contained in the generic table
of contaminant-specific remedial action objectives for unrestricted use
developed pursuant to subdivision six of this section. Provided, howev-
er, that volunteers whose proposed remedial program [for the remediation
of groundwater] (1)(I) may require the long-term employment of institu-
tional or engineering controls FOR THE REMEDIATION OF GROUNDWATER after
the bulk reduction of groundwater contamination to asymptotic levels has
been achieved OR (II) MAY REQUIRE AN INSTITUTIONAL OR ENGINEERING
CONTROL FOR MORE THAN FIVE YEARS SOLELY TO ADDRESS SOIL VAPOR INTRUSION
but (2) whose program would otherwise conform with the requirements
necessary to qualify for Track 1, shall qualify for Track 1.
Track 2: The remedial program may include restrictions on the use of
the site or reliance on the long-term employment of engineering and/or
institutional controls, but shall achieve contaminant-specific remedial
action objectives for soil which conform with those contained in one of
the generic tables developed pursuant to subdivision six of this section
without the use of institutional or engineering controls to reach such
objectives.
Track 3: The remedial program shall achieve contaminant-specific reme-
dial action objectives for soil which conform with the criteria used to
develop the generic tables for such objectives developed pursuant to
subdivision six of this section but may use site specific data to deter-
mine such objectives.
Track 4: The remedial program shall achieve a cleanup level that will
be protective for the site's current, intended or reasonably anticipated
residential, commercial, or industrial use with restrictions and with
reliance on the long-term employment of institutional or engineering
controls to achieve such level. The regulations shall include a
provision requiring that a cleanup level which poses a risk in excee-
dance of an excess cancer risk of one in one million for carcinogenic
end points and a hazard index of one for non-cancer end points for a
specific contaminant at a specific site may be approved by the depart-
ment without requiring the use of institutional or engineering controls
to eliminate exposure only upon a site specific finding by the commis-
sioner, in consultation with the commissioner of health, that such level
shall be protective of public health and environment. Such finding shall
S. 6359 197 A. 8559
be included in the draft remedial work plan for the site and fully
described in the notice and fact sheet provided for such work plan.
S 11. Paragraphs (b), (c) and (d) of subdivision 7 of section 27-1415
of the environmental conservation law are relettered paragraphs (c), (d)
and (e) and a new paragraph (b) is added to read as follows:
(B) WITHIN ONE HUNDRED EIGHTY DAYS OF COMMENCEMENT OF THE REMEDIAL
DESIGN OR AT LEAST THREE MONTHS PRIOR TO THE DATE OF THE ANTICIPATED
ISSUANCE OF THE CERTIFICATE OF COMPLETION, THE OWNER OF A BROWNFIELD
SITE, AND/OR ANY PERSON RESPONSIBLE FOR IMPLEMENTING A REMEDIAL PROGRAM
AT SUCH SITE, WHERE INSTITUTIONAL OR ENGINEERING CONTROLS ARE EMPLOYED
PURSUANT TO THIS TITLE, SHALL EXECUTE AN ENVIRONMENTAL EASEMENT PURSUANT
TO TITLE THIRTY-SIX OF ARTICLE SEVENTY-ONE OF THIS CHAPTER.
S 12. Paragraph (h) of subdivision 3 of section 27-1417 of the envi-
ronmental conservation law is REPEALED, paragraph (i) is relettered
paragraph (h) and paragraph (f), as amended by section 8 of part A of
chapter 577 of the laws of 2004, is amended to read as follows:
(f) Before the department [finalizes] SELECTS a proposed [remedial
work plan] REMEDY FROM THE ALTERNATIVES SET FORTH IN THE ALTERNATIVES
ANALYSIS AS PRESCRIBED BY SECTION 27-1413 OF THIS TITLE or makes a
determination that site conditions meet the requirements of this title
without the necessity for remediation pursuant to section 27-1411 of
this title, the department, in consultation with the applicant, must
notify individuals on the brownfield site contact list. Such notice
shall include a fact sheet describing such plan and provide for a
forty-five day public comment period. The commissioner shall hold a
public meeting if requested by the affected community and the commis-
sioner has found that the site constitutes a significant threat to the
public health or the environment. Further, the affected community may
request a public meeting at sites that do not constitute a significant
threat. (1) To the extent that the department has determined that site
conditions do not pose a significant threat and the site is being
addressed by a volunteer, the notice shall state that the department has
determined that no remediation is required for the off-site areas and
that the department's determination of a significant threat is subject
to this forty-five day comment period. (2) If the [remedial work plan]
REMEDY includes a Track 2, Track 3 or Track 4 remedy at a non-signifi-
cant threat site, such comment period shall apply both to the approval
of the alternatives analysis by the department, IF APPLICABLE, and the
proposed remedy selected by the applicant.
S 13. Paragraph (a) of subdivision 2 and subdivision 3 of section
27-1419 of the environmental conservation law, paragraph (a) of subdivi-
sion 2 as added by section 1 of part A of chapter 1 of the laws of 2003,
subdivision 3 as amended by chapter 390 of the laws of 2008, are amended
to read as follows:
(a) a description of the remediation activities completed pursuant to
the remedial work plan AND ANY INTERIM REMEDIAL MEASURES for the brown-
field site AND THE COSTS PAID FOR THOSE ACTIVITIES;
3. Upon receipt of the final engineering report, the department shall
review such report and the data submitted pursuant to the brownfield
site cleanup agreement as well as any other relevant information regard-
ing the brownfield site. Upon satisfaction of the commissioner that the
remediation requirements set forth in this title have been or will be
achieved in accordance with the timeframes, if any, established in the
remedial work plan, the commissioner shall issue a written certificate
of completion[, such]. THE certificate shall include such information as
determined by the department of taxation and finance, including but not
S. 6359 198 A. 8559
limited to the brownfield site boundaries included in the final engi-
neering report, the date of the brownfield site CLEANUP agreement
[pursuant to section 27-1409 of this title], IDENTIFICATION OF THE ENTI-
TY OR ENTITIES ELIGIBLE FOR CREDITS PURSUANT TO SECTIONS TWENTY-ONE,
TWENTY-TWO OR TWENTY-THREE OF THE TAX LAW, and the applicable percent-
ages available AS OF THE DATE OF THE CERTIFICATE OF COMPLETION for that
site for purposes of section twenty-one of the tax law[, with such
percentages to be determined as follows with respect to such qualified
site]. FOR THOSE SITES FOR WHICH THE DEPARTMENT HAS ISSUED A NOTICE TO
THE APPLICANT ON OR AFTER JULY FIRST, TWO THOUSAND FOURTEEN THAT ITS
REQUEST FOR PARTICIPATION HAS BEEN ACCEPTED UNDER SUBDIVISION SIX OF
SECTION 27-1407 OF THIS TITLE, THE TANGIBLE PROPERTY CREDIT COMPONENT OF
THE BROWNFIELD REDEVELOPMENT TAX CREDIT PURSUANT TO PARAGRAPH THREE OF
SUBDIVISION (A) OF SECTION TWENTY-ONE OF THE TAX LAW SHALL ONLY BE
AVAILABLE TO THE TAXPAYER IF THE NOTICE INCLUDES A DETERMINATION THAT
THE CRITERIA FOR RECEIVING SUCH TAX COMPONENT HAVE BEEN MET. FOR THOSE
SITES for which the department has issued a notice to the taxpayer after
June twenty-third, two thousand eight that its request for participation
has been accepted under subdivision six of section 27-1407 of this
title[:
For the purposes of calculating], THE APPLICABLE PERCENTAGE FOR the
site preparation credit component pursuant to paragraph two of subdivi-
sion (a) of section twenty-one of the tax law, and the on-site groundwa-
ter remediation credit component pursuant to paragraph four of subdivi-
sion (a) of section twenty-one of the tax law[, the applicable
percentage] shall be based on the level of cleanup achieved pursuant to
subdivision four of section 27-1415 of this title and the level of
cleanup of soils to contaminant-specific soil cleanup objectives promul-
gated pursuant to subdivision six of section 27-1415 of this title, up
to a maximum of fifty percent, as follows:
(a) soil cleanup for unrestricted use, the protection of groundwater
or the protection of ecological resources, the applicable percentage
shall be fifty percent;
(b) soil cleanup for residential use, the applicable percentage shall
be forty percent, except for Track 4 which shall be twenty-eight
percent;
(c) soil cleanup for commercial use, the applicable percentage shall
be thirty-three percent, except for Track 4 which shall be twenty-five
percent;
(d) soil cleanup for industrial use, the applicable percentage shall
be twenty-seven percent, except for Track 4 which shall be twenty-two
percent.
S 14. Subdivision 5 of section 27-1419 of the environmental conserva-
tion law, as amended by section 9 of part A of chapter 577 of the laws
of 2004, is amended to read as follows:
5. A certificate of completion issued pursuant to this section may be
transferred [to the applicant's successors or assigns upon transfer or
sale of the brownfield site] BY THE APPLICANT OR SUBSEQUENT HOLDER OF
THE CERTIFICATE OF COMPLETION TO A SUCCESSOR TO A REAL PROPERTY INTER-
EST, INCLUDING LEGAL TITLE, EQUITABLE TITLE OR LEASEHOLD, IN ALL OR A
PART OF THE BROWNFIELD SITE FOR WHICH THE CERTIFICATE OF COMPLETION WAS
ISSUED; PROVIDED, HOWEVER, ANY TRANSFER OF A CERTIFICATE OF COMPLETION
TO A RESPONSIBLE PARTY SHALL NOT PROVIDE RELIEF FROM LIABILITY. Further,
a certificate of completion may be modified or revoked by the commis-
sioner upon a finding that:
S. 6359 199 A. 8559
(a) Either the applicant, or the applicant's successors or assigns,
has failed to comply with the terms and conditions of the brownfield
site cleanup agreement;
(b) The applicant made a misrepresentation of a material fact tending
to demonstrate that (I) it was qualified as a volunteer OR (II) MET THE
CRITERIA SET FORTH IN SUBDIVISION ONE-A OF SECTION 27-1407 OF THIS TITLE
FOR THE PURPOSE OF RECEIVING THE TANGIBLE PROPERTY CREDIT COMPONENT OF
THE BROWNFIELD REDEVELOPMENT TAX CREDIT PURSUANT TO PARAGRAPH THREE OF
SUBDIVISION (A) OF SECTION TWENTY-ONE OF THE TAX LAW;
(c) Either the applicant, or the applicant's successors or assigns,
made a misrepresentation of a material fact tending to demonstrate that
the cleanup levels identified in the brownfield site cleanup agreement
were reached; [or]
(d) THE ENVIRONMENTAL EASEMENT CREATED AND RECORDED PURSUANT TO TITLE
THIRTY-SIX OF ARTICLE SEVENTY-ONE OF THIS CHAPTER NO LONGER PROVIDES AN
EFFECTIVE OR ENFORCEABLE MEANS OF ENSURING THE PERFORMANCE OF MAINTE-
NANCE, MONITORING OR OPERATING REQUIREMENTS, OR THE RESTRICTIONS ON
FUTURE USES, INCLUDING RESTRICTIONS ON DRILLING FOR OR WITHDRAWING
GROUNDWATER; OR
(E) There is good cause for such modification or revocation.
S 15. Section 27-1423 of the environmental conservation law is
REPEALED.
S 16. Section 27-1429 of the environmental conservation law, as
amended by section 13 of part A of chapter 577 of the laws of 2004, is
amended to read as follows:
S 27-1429. Permit waivers.
The department[, by and through the commissioner,] shall be EXEMPT,
AND SHALL BE authorized to exempt a person from the requirement to
obtain any state or local permit or other authorization for any activity
needed to implement a program for the investigation and/or remediation
of contamination AT OR EMANATING FROM A BROWNFIELD SITE; provided that
the activity is conducted in a manner which satisfies all substantive
technical requirements applicable to like activity conducted pursuant to
a permit.
S 17. Subdivision 1 of section 27-1431 of the environmental conserva-
tion law is amended by adding a new paragraph c to read as follows:
C. TO INSPECT FOR COMPLIANCE WITH THE SITE MANAGEMENT PLAN APPROVED BY
THE DEPARTMENT, INCLUDING (I) INSPECTION OF THE PERFORMANCE OF MAINTE-
NANCE, MONITORING AND OPERATIONAL ACTIVITIES REQUIRED AS PART OF THE
REMEDIAL PROGRAM FOR THE SITE, (II) INSPECTION FOR THE PURPOSE OF ASCER-
TAINING CURRENT USES OF THE SITE, AND (III) TAKING SAMPLES IN ACCORDANCE
WITH PARAGRAPH A OF THIS SUBDIVISION.
S 17-a. Section 27-1435 of the environmental conservation law is
REPEALED.
S 18. The environmental conservation law is amended by adding a new
section 27-1437 to read as follows:
S 27-1437. BCP-EZ PROGRAM.
1. NOTWITHSTANDING THE PROVISIONS OF THIS TITLE OR ANY OTHER PROVISION
OF LAW, THE DEPARTMENT IS AUTHORIZED TO EXEMPT A VOLUNTEER FROM PROCE-
DURAL REQUIREMENTS OF THIS TITLE THAT THE DEPARTMENT MAY SPECIFY WHICH
ARE OTHERWISE APPLICABLE TO IMPLEMENTATION OF AN INVESTIGATION AND/OR
REMEDIATION OF CONTAMINATION, PROVIDED THAT:
(A) THE DEPARTMENT HAS DETERMINED THAT THE BROWNFIELD SITE DOES NOT
POSE A SIGNIFICANT THREAT PURSUANT TO SECTION 27-1411 OF THIS TITLE;
S. 6359 200 A. 8559
(B) THE APPLICANT HAS WAIVED IN WRITING ANY CLAIM FOR TAX CREDITS
PURSUANT TO SECTION TWENTY-ONE OF THE TAX LAW ON A FORM PRESCRIBED BY
THE DEPARTMENT; AND
(C) THE ACTIVITY IS CONDUCTED IN A MANNER WHICH SATISFIES ALL SUBSTAN-
TIVE TECHNICAL REQUIREMENTS APPLICABLE TO LIKE ACTIVITY CONDUCTED PURSU-
ANT TO THIS TITLE.
2. WHERE A WAIVER HAS BEEN GRANTED, THE APPROVED WORK PLAN FOR A
BROWNFIELD SITE SHALL INCLUDE THE PROCEDURAL REQUIREMENTS THE DEPARTMENT
DETERMINES APPROPRIATE BASED ON SITE SPECIFIC CONSIDERATIONS AND CONSID-
ERATION OF SECTION 27-1417 OF THIS TITLE.
3. FOR ANY SITE ACCEPTED INTO THE BCP-EZ PROGRAM PURSUANT TO THIS
SECTION WHICH IS PURSUING A TRACK 4 REMEDIATION, IF A CONTAMINANT IS
IDENTIFIED IN SOIL IN EXCESS OF THE REMEDIAL ACTION OBJECTIVES CONTAINED
IN AN APPLICABLE GENERIC TABLE DEVELOPED PURSUANT TO SUBDIVISION SIX OF
SECTION 27-1415 OF THIS TITLE, THE APPLICANT MAY USE SITE-SPECIFIC DATA
TO DEMONSTRATE TO THE DEPARTMENT THAT THE CONCENTRATION OF THE CONTAM-
INANT IN THE SOILS REFLECTS BACKGROUND CONDITIONS AND, IN THAT CASE, A
CONTAMINANT-SPECIFIC ACTION OBJECTIVE FOR SUCH CONTAMINANT EQUAL TO SUCH
BACKGROUND CONCENTRATION MAY BE ESTABLISHED.
S 19. The opening paragraph of subdivision 10 of section 71-3605 of
the environmental conservation law, as added by section 2 of part A of
chapter 1 of the laws of 2003, is amended to read as follows:
An environmental easement may be enforced in law or equity by its
grantor, by the state, or any affected local government as defined in
section 71-3603 of this title. Such easement is enforceable against the
owner of the burdened property, any lessees, and any person using the
land. Enforcement shall not be defeated because of any subsequent
adverse possession, laches, estoppel, REVERSION or waiver. No general
law of the state which operates to defeat the enforcement of any inter-
est in real property shall operate to defeat the enforcement of any
environmental easement unless such general law expressly states the
intent to defeat the enforcement of such easement or provides for the
exercise of the power of eminent domain. It is not a defense in any
action to enforce an environmental easement that:
S 20. Paragraph 2 of subdivision (a) of section 21 of the tax law, as
amended by section 1 of part H of chapter 577 of the laws of 2004, is
amended to read as follows:
(2) Site preparation credit component. The site preparation credit
component shall be equal to the applicable percentage of the site prepa-
ration costs paid [or incurred] by the taxpayer with respect to a quali-
fied site. The credit component amount so determined with respect to a
site's qualification for a certificate of completion shall be allowed
for the taxable year in which the effective date of the certificate of
completion occurs. The credit component amount determined other than
with respect to such qualification shall be allowed for the taxable year
in which the improvement to which the applicable costs apply is placed
in service for up to five taxable years after the issuance of such
certificate of completion.
S 21. Paragraph 3 of subdivision (a) of section 21 of the tax law, as
amended by chapter 390 of the laws of 2008, is amended to read as
follows:
(3) Tangible property credit component. The tangible property credit
component shall be equal to the applicable percentage of the cost or
other basis for federal income tax purposes of tangible personal proper-
ty and other tangible property, including buildings and structural
components of buildings, which constitute qualified tangible property;
S. 6359 201 A. 8559
provided[, however,] that in determining the cost or other basis of such
property, the taxpayer shall exclude the acquisition cost of any item of
property with respect to which a credit under this section was allowable
to another taxpayer. WITH RESPECT TO ANY QUALIFIED SITE FOR WHICH THE
DEPARTMENT OF ENVIRONMENTAL CONSERVATION HAS ISSUED A NOTICE TO THE
TAXPAYER ON OR AFTER JULY FIRST, TWO THOUSAND FOURTEEN THAT ITS REQUEST
FOR PARTICIPATION HAS BEEN ACCEPTED UNDER SUBDIVISION SIX OF SECTION
27-1407 OF THE ENVIRONMENTAL CONSERVATION LAW, THE TAXPAYER MAY ALSO
INCLUDE THE COSTS INCURRED IN CONNECTION WITH PREPARING A SITE FOR THE
ERECTION OF A BUILDING OR A COMPONENT OF A BUILDING, SUCH AS THE COST OF
EXCAVATION, DEMOLITION, TEMPORARY ELECTRIC WIRING, SCAFFOLDING, FENCING
AND SECURITY FACILITIES, TO THE EXTENT THAT SUCH COSTS ARE NOT USED AS A
BASIS FOR COMPUTING THE SITE PREPARATION COMPONENT OF THE BROWNFIELD
REDEVELOPMENT TAX CREDIT PURSUANT TO PARAGRAPH TWO OF THIS SUBDIVISION;
AND PROVIDED FURTHER THAT, IN THE CASE OF QUALIFIED SITES ELIGIBLE FOR
THE FIVE PERCENT AFFORDABLE HOUSING TANGIBLE PROPERTY CREDIT COMPONENT
PURSUANT TO CLAUSE (III) OF SUBPARAGRAPH (B) OF PARAGRAPH FIVE OF THIS
SUBDIVISION, THAT PORTION OF THE TANGIBLE PROPERTY CREDIT COMPONENT WILL
BE DETERMINED BY MULTIPLYING THE TOTAL COSTS QUALIFIED FOR THE TANGIBLE
PROPERTY CREDIT COMPONENT BY A FRACTION, THE NUMERATOR OF WHICH SHALL BE
THE SQUARE FOOTAGE OF SPACE OF THE AFFORDABLE HOUSING UNITS DEDICATED TO
RESIDENTIAL OCCUPANCY AND THE DENOMINATOR OF WHICH SHALL BE THE TOTAL
SQUARE FOOTAGE OF THE SITE. The credit component amount so determined
shall be allowed for the taxable year in which such qualified tangible
property is FIRST placed in service on a qualified site with respect to
which a certificate of completion has been issued to the taxpayer, OR
FOR THE TAXABLE YEAR IN WHICH THE CERTIFICATE OF COMPLETION IS ISSUED IF
THE QUALIFIED TANGIBLE PROPERTY IS PLACED IN SERVICE PRIOR TO THE ISSU-
ANCE OF THE CERTIFICATE OF COMPLETION, for up to [ten] FIVE CONSECUTIVE
taxable years [after] FROM THE START OF THE REDEVELOPMENT OF THE SITE
PROVIDED THAT THE REDEVELOPMENT STARTS WITHIN TEN YEARS OF the date of
the issuance of such certificate of completion. The tangible property
credit component shall be allowed with respect to property leased to a
second party only if such second party is either (i) not a party respon-
sible for the disposal of hazardous waste or the discharge of petroleum
at the site according to applicable principles of statutory or common
law liability, or (ii) a party responsible according to applicable prin-
ciples of statutory or common law liability if such party's liability
arises solely from operation of the site subsequent to the disposal of
hazardous waste or the discharge of petroleum, and is so certified by
the commissioner of environmental conservation at the request of the
taxpayer, pursuant to section 27-1419 of the environmental conservation
law. Notwithstanding any other provision of law to the contrary, in the
case of allowance of credit under this section to such a lessor, the
commissioner shall have the authority to reveal to such lessor any
information, with respect to the issue of qualified use of property by
the lessee, which is the basis for the denial in whole or in part, or
for the recapture, of the credit claimed by such lessor. For purposes of
the tangible property credit component allowed under this section the
taxpayer to whom the certificate of completion is issued, as provided
for under subdivision five of section 27-1419 of the environmental
conservation law, may transfer the benefits and burdens of the certif-
icate of completion, which run with the land and to the applicant's
successors or assigns upon transfer or sale of all or any portion of an
interest or estate in the qualified site. However, the taxpayer to whom
certificate's benefits and burdens are transferred shall not include the
S. 6359 202 A. 8559
cost of acquiring all or any portion of an interest or estate in the
site and the amounts included in the cost or other basis for federal
income tax purposes of qualified tangible property already claimed by
the previous taxpayer pursuant to this section. THE TANGIBLE PROPERTY
CREDIT COMPONENT SHALL NOT INCLUDE COSTS PAID TO A RELATED PARTY OR
PARTIES, AS SUCH TERM "RELATED PERSON" IS DEFINED IN SUBPARAGRAPH (C) OF
PARAGRAPH THREE OF SUBDIVISION (B) OF SECTION FOUR HUNDRED SIXTY-FIVE OF
THE INTERNAL REVENUE CODE. ELIGIBLE COSTS FOR THE TANGIBLE PROPERTY
CREDIT COMPONENT ARE LIMITED TO COSTS ASSOCIATED WITH ACTUAL
CONSTRUCTION OF TANGIBLE PROPERTY INCORPORATED AS PART OF THE PHYSICAL
STRUCTURE, AND COSTS ASSOCIATED WITH THE PREPARATION OF THE SITE FOR
ERECTION OF A BUILDING OR A COMPONENT OF A BUILDING THAT ARE NOT PROPER-
LY INCLUDED IN THE SITE PREPARATION COMPONENT.
S 22. Subparagraph (A) of paragraph 3-a of subdivision (a) of section
21 of the tax law, as added by chapter 390 of the laws of 2008, is
amended to read as follows:
(A) Notwithstanding any other provision of law to the contrary, the
tangible property credit component available for any qualified site
pursuant to paragraph three of this subdivision shall not exceed thir-
ty-five million dollars or three times the SUM OF THE costs included in
the calculation of the site preparation credit component and the on-site
groundwater remediation credit component under paragraphs two and four,
respectively, of this subdivision, AND THE COSTS THAT WOULD HAVE BEEN
INCLUDED IN THE CALCULATION OF SUCH COMPONENTS IF NOT TREATED AS AN
EXPENSE AND DEDUCTED PURSUANT TO SECTION ONE HUNDRED NINETY-EIGHT OF THE
INTERNAL REVENUE CODE, whichever is less; provided, however, that: (1)
in the case of a qualified site to be used primarily for manufacturing
activities, the tangible property credit component available for any
qualified site pursuant to paragraph three of this subdivision shall not
exceed forty-five million dollars or six times the SUM OF THE costs
included in the calculation of the site preparation credit component and
the on-site groundwater remediation credit component under paragraphs
two and four, respectively, of this subdivision, AND THE COSTS THAT
WOULD HAVE BEEN INCLUDED IN THE CALCULATION OF SUCH COMPONENTS IF NOT
TREATED AS AN EXPENSE AND DEDUCTED PURSUANT TO SECTION ONE HUNDRED NINE-
TY-EIGHT OF THE INTERNAL REVENUE CODE, whichever is less; and (2) the
provisions of this paragraph shall not apply to any qualified site for
which the department of environmental conservation has issued a notice
to the taxpayer before June twenty-third, two thousand eight that its
request for participation has been accepted under subdivision six of
section 27-1407 of the environmental conservation law.
S 23. Subparagraph (D) of paragraph 3-a of subdivision (a) of section
21 of the tax law, as added by chapter 390 of the laws of 2008, is
amended to read as follows:
(D) [If] WITH RESPECT TO ANY QUALIFIED SITE FOR WHICH THE DEPARTMENT
OF ENVIRONMENTAL CONSERVATION HAS ISSUED A NOTICE TO THE TAXPAYER BEFORE
JULY FIRST, TWO THOUSAND FOURTEEN THAT ITS REQUEST FOR PARTICIPATION HAS
BEEN ACCEPTED UNDER SUBDIVISION SIX OF SECTION 27-1407 OF THE ENVIRON-
MENTAL CONSERVATION LAW, OR WHERE THE TAXPAYER HAS EITHER BEEN ISSUED OR
RECEIVED A CERTIFICATE OF COMPLETION FROM ANOTHER TAXPAYER UNDER SECTION
27-1419 OF THE ENVIRONMENTAL CONSERVATION LAW BEFORE JULY FIRST, TWO
THOUSAND FOURTEEN, IF the qualifying site is located in a brownfield
opportunity area and is developed in conformance with the goals and
priorities established for that applicable brownfield opportunity area
as designated pursuant to section nine hundred seventy-r of the general
S. 6359 203 A. 8559
municipal law, the applicable percentage of the tangible property credit
component will be increased by two percent.
S 24. Paragraph 4 of subdivision (a) of section 21 of the tax law, as
amended by section 1 of part H of chapter 577 of the laws of 2004, is
amended to read as follows:
(4) On-site groundwater remediation credit component. The on-site
groundwater remediation credit component shall be equal to the applica-
ble percentage of the on-site groundwater remediation costs paid [or
incurred] by the taxpayer with respect to a qualified site (to the
extent that such groundwater remediation costs are not included in the
determination of the site preparation credit or the cost or other basis
included in the determination of the tangible property credit). The
credit component so determined for costs [incurred and] paid with
respect to and prior to the issuance of a certificate of completion
shall be allowed for the taxable year in which the effective date of the
issuance of a certificate of completion occurs. The credit component
amount determined in taxable years after the effective date of the issu-
ance of a certificate of completion shall be allowed in the taxable year
such qualified costs are [incurred and] paid for up to five taxable
years after the issuance of such certificate of completion.
S 25. Paragraph 5 of subdivision (a) of section 21 of the tax law, as
amended by section 1 of part H of chapter 577 of the laws of 2004, is
amended to read as follows:
(5) Applicable percentage. (A) For purposes of COMPUTING THE SITE
PREPARATION AND ON-SITE GROUNDWATER REMEDIATION CREDIT COMPONENTS PURSU-
ANT TO paragraphs two[, three] and four of this subdivision, WITH
RESPECT TO SUCH QUALIFIED SITES FOR WHICH THE DEPARTMENT OF ENVIRON-
MENTAL CONSERVATION HAS ISSUED A NOTICE TO THE TAXPAYER BEFORE JUNE
TWENTY-THIRD, TWO THOUSAND EIGHT THAT ITS REQUEST FOR PARTICIPATION HAS
BEEN ACCEPTED UNDER SUBDIVISION SIX OF SECTION 27-1407 OF THE ENVIRON-
MENTAL CONSERVATION LAW, OR WHERE THE TAXPAYER HAS EITHER BEEN ISSUED OR
RECEIVED A CERTIFICATE OF COMPLETION FROM ANOTHER TAXPAYER UNDER SECTION
27-1419 OF THE ENVIRONMENTAL CONSERVATION LAW BEFORE JUNE TWENTY-THIRD,
TWO THOUSAND EIGHT, AND, FOR PURPOSES OF COMPUTING THE TANGIBLE PROPERTY
COMPONENT PURSUANT TO PARAGRAPH THREE OF THIS SUBDIVISION WITH RESPECT
TO SUCH QUALIFIED SITES FOR WHICH THE DEPARTMENT OF ENVIRONMENTAL
CONSERVATION HAS ISSUED A NOTICE TO THE TAXPAYER BEFORE JULY FIRST, TWO
THOUSAND FOURTEEN THAT ITS REQUEST FOR PARTICIPATION HAS BEEN ACCEPTED
UNDER SUBDIVISION SIX OF SECTION 27-1407 OF THE ENVIRONMENTAL CONSERVA-
TION LAW, OR WHERE THE TAXPAYER HAS EITHER BEEN ISSUED OR RECEIVED A
CERTIFICATE OF COMPLETION FROM ANOTHER TAXPAYER UNDER SECTION 27-1419 OF
THE ENVIRONMENTAL CONSERVATION LAW BEFORE JULY FIRST, TWO THOUSAND FOUR-
TEEN, the applicable percentage shall be twelve percent in the case of
credits claimed under article nine, nine-A, thirty-two or thirty-three
of this chapter, and ten percent in the case of credits claimed under
article twenty-two of this chapter, except that where at least fifty
percent of the area of the qualified site relating to the credit
provided for in this section is located in an environmental zone as
defined in paragraph six of subdivision (b) of this section, the appli-
cable percentage shall be increased by an additional eight percent.
Provided, however, as afforded in section 27-1419 of the environmental
conservation law, if the certificate of completion indicates that the
qualified site has been remediated to Track 1 as that term is described
in subdivision four of section 27-1415 of the environmental conservation
law, the applicable percentage set forth in the first sentence of this
paragraph shall be increased by an additional two percent.
S. 6359 204 A. 8559
(B) WITH RESPECT TO SUCH QUALIFIED SITE FOR WHICH THE DEPARTMENT OF
ENVIRONMENTAL CONSERVATION HAS ISSUED A NOTICE TO THE TAXPAYER ON OR
AFTER JULY FIRST, TWO THOUSAND FOURTEEN THAT ITS REQUEST FOR PARTIC-
IPATION HAS BEEN ACCEPTED UNDER SUBDIVISION SIX OF SECTION 27-1407 OF
THE ENVIRONMENTAL CONSERVATION LAW, THE APPLICABLE PERCENTAGE FOR THE
TANGIBLE PROPERTY CREDIT COMPONENT OF THE BROWNFIELD REDEVELOPMENT TAX
CREDIT PURSUANT TO PARAGRAPH THREE OF SUBDIVISION (A) OF THIS SECTION
SHALL BE THE SUM OF TEN PERCENT AND THE FOLLOWING ADDITIONAL PERCENT-
AGES, PROVIDED THAT THE TOTAL PERCENTAGE OF THE TANGIBLE PROPERTY CREDIT
COMPONENT SHALL NOT EXCEED TWENTY-FOUR PERCENT AND IS OTHERWISE SUBJECT
TO THE LIMITATIONS SET FORTH IN PARAGRAPHS THREE AND THREE-A OF SUBDIVI-
SION (A) OF THIS SECTION:
(I) TEN PERCENT FOR A SITE WITHIN AN ENVIRONMENTAL ZONE;
(II) FIVE PERCENT FOR A STRATEGIC SITE LOCATED WITHIN A DESIGNATED
BROWNFIELD OPPORTUNITY AREA IF THE PROPOSED DEVELOPMENT OF THE SITE IS
CERTIFIED TO BE IN CONFORMANCE WITH SUCH BROWNFIELD OPPORTUNITY AREA
PLAN PURSUANT TO SECTION NINE HUNDRED SEVENTY-R OF THE GENERAL MUNICIPAL
LAW; AND
(III) FIVE PERCENT FOR SITES DEVELOPED AS AFFORDABLE HOUSING, DEFINED
AS HAVING AT LEAST TWENTY PERCENT OF ITS RESIDENTIAL UNITS SUBJECT TO AN
AGREEMENT WITH A MUNICIPALITY, THE STATE, THE FEDERAL GOVERNMENT, OR AN
INSTRUMENTALITY THEREOF, WHERE SUCH AGREEMENT RESTRICTS OCCUPANCY OF
THOSE UNITS TO RESIDENTS WHO QUALIFY IN ACCORDANCE WITH AN INCOME TEST.
(C) THE TAXPAYER SHALL SUBMIT, IN THE MANNER PRESCRIBED BY THE COMMIS-
SIONER, INFORMATION SUFFICIENT TO DEMONSTRATE THAT THE SITE QUALIFIES
FOR ANY CREDIT COMPONENTS AVAILABLE UNDER CLAUSES (I) THROUGH (III) OF
SUBPARAGRAPH (B) OF THIS PARAGRAPH. IF THE SITE IS A PRIORITY ECONOMIC
DEVELOPMENT PROJECT, THE TAXPAYER MUST ALSO DEMONSTRATE THAT THE PROJECT
HAS BEEN APPROVED BY THE DEPARTMENT OF ECONOMIC DEVELOPMENT.
S 26. Paragraph 6 of subdivision (a) of section 21 of the tax law, as
amended by section 1 of part H of chapter 577 of the laws of 2004, is
amended to read as follows:
(6) Site preparation costs and on-site groundwater remediation costs
paid [or incurred] by the taxpayer with respect to a qualified site and
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, which constitute qualified tangible
property shall only include costs paid [or incurred] by the taxpayer on
or after the date of the brownfield site cleanup agreement executed by
the taxpayer and the department of environmental conservation pursuant
to section 27-1409 of the environmental conservation law.
S 27. Paragraphs 2, 4 and 6 of subdivision (b) of section 21 of the
tax law, as amended by section 1 of part H of chapter 577 of the laws of
2004 and subparagraph (B) and the closing paragraph of paragraph 6 as
amended by section 1 of part G of chapter 62 of the laws of 2006, are
amended to read as follows:
(2) Site preparation costs. The term "site preparation costs" shall
mean all amounts properly [chargeable] CHARGED to a capital account, (i)
which are paid [or incurred] in connection with a site's qualification
for a certificate of completion AND ATTRIBUTABLE TO ACTIVITIES SPECIFIED
IN A DECISION DOCUMENT ISSUED BY THE DEPARTMENT OF ENVIRONMENTAL CONSER-
VATION UNDER SECTION 27-1411 OF THE ENVIRONMENTAL CONSERVATION LAW AND
WHICH MAY INCLUDE COSTS ATTRIBUTABLE TO ACTIVITIES UNDERTAKEN UNDER THE
OVERSIGHT OF THE DEPARTMENT OF HEALTH OR THE DEPARTMENT OF LABOR TO
REMEDIATE REGULATED MATERIALS INCLUDING ASBESTOS, LEAD OR POLYCHLORINAT-
ED BIPHENYLS IN BUILDINGS WHICH WILL REMAIN ON THE SITE, and (ii) WITH
S. 6359 205 A. 8559
RESPECT TO ANY QUALIFIED SITE FOR WHICH THE DEPARTMENT OF ENVIRONMENTAL
CONSERVATION HAS ISSUED A NOTICE TO THE TAXPAYER BEFORE JULY FIRST, TWO
THOUSAND FOURTEEN THAT ITS REQUEST FOR PARTICIPATION HAS BEEN ACCEPTED
UNDER SUBDIVISION SIX OF SECTION 27-1407 OF THE ENVIRONMENTAL CONSERVA-
TION LAW, all other site preparation costs paid [or incurred] in
connection with preparing a site for the erection of a building or a
component of a building, or otherwise to establish a site as usable for
its industrial, commercial (including the commercial development of
residential housing), recreational or conservation purposes. [Site] FOR
PURPOSES OF SUBPARAGRAPH (II) OF THIS PARAGRAPH, SITE preparation costs
shall include, but not be limited to, the costs of excavation, temporary
electric wiring, scaffolding, demolition costs, and the costs of fencing
and security facilities. Site preparation costs shall not include the
cost of acquiring the site and shall not include amounts included in the
cost or other basis for federal income tax purposes of qualified tangi-
ble property, as described in paragraph three of this subdivision.
"SITE PREPARATION COSTS" SHALL NOT INCLUDE COSTS PAID TO A RELATED PARTY
OR PARTIES, AS SUCH TERM "RELATED PERSON" IS DEFINED IN SUBPARAGRAPH (C)
OF PARAGRAPH THREE OF SUBDIVISION (B) OF SECTION FOUR HUNDRED SIXTY-FIVE
OF THE INTERNAL REVENUE CODE. ELIGIBLE SITE PREPARATION COSTS ARE
LIMITED TO COSTS DIRECTLY ASSOCIATED WITH ACTUAL SITE PREPARATION-RELAT-
ED CONSTRUCTION.
(4) On-site groundwater remediation costs. The term "on-site groundwa-
ter remediation costs" shall mean all amounts properly [chargeable]
CHARGED to a capital account, (i) which are paid [or incurred] in
connection with a site's qualification for a certificate of completion,
and (ii) include costs which are paid [or incurred] in connection with
the remediation of on-site groundwater contamination and [incurred] PAID
to implement a requirement of the remedial work plan or an interim reme-
dial measure work plan for a qualified site which are imposed pursuant
to subdivisions two and three of section 27-1411 of the environmental
conservation law. "ON-SITE GROUNDWATER REMEDIATION COSTS" SHALL NOT
INCLUDE COSTS PAID TO A RELATED PARTY OR PARTIES, AS SUCH TERM "RELATED
PERSON" IS DEFINED IN SUBPARAGRAPH (C) OF PARAGRAPH THREE OF SUBDIVISION
(B) OF SECTION FOUR HUNDRED SIXTY-FIVE OF THE INTERNAL REVENUE CODE. ON
SITE GROUNDWATER REMEDIATION COSTS ARE LIMITED TO COSTS DIRECTLY ASSOCI-
ATED WITH ACTUAL GROUNDWATER REMEDIATION ACTIVITIES.
(6) Environmental zones (EN-Zones). An "environmental zone" shall mean
an area designated as such by the commissioner of [economic development]
LABOR. Such areas so designated are areas which are census tracts and
block numbering areas which, as of the [two thousand] MOST RECENT
census, satisfy either of the following criteria:
(A) areas that have both:
(i) a poverty rate of at least twenty percent for the year to which
the data relate; and
(ii) an unemployment rate of at least one and one-quarter times the
statewide unemployment rate for the year to which the data relate, or;
(B) areas that have a poverty rate of at least two times the poverty
rate for the county in which the areas are located for the year to which
the data relate [provided, however, that a qualified site shall only be
deemed to be located in an environmental zone under this subparagraph
(B) if such site was the subject of a brownfield site cleanup agreement
pursuant to section 27-1409 of the environmental conservation law that
was entered into prior to September first, two thousand ten].
Such designation shall be made and a list of all such environmental
zones shall be established by the commissioner of [economic development]
S. 6359 206 A. 8559
LABOR no later than [December thirty-first, two thousand four provided,
however, that a qualified site shall only be deemed to be located in an
environmental zone under subparagraph (B) of this paragraph if such site
was the subject of a brownfield site cleanup agreement pursuant to
section 27-1409 of the environmental conservation law that was entered
into prior to September first, two thousand ten] NINETY DAYS FOLLOWING
THE OFFICIAL PUBLICATION OF THE MOST RECENT CENSUS.
S 28. Paragraph 2 of subdivision (b) of section 22 of the tax law, as
amended by section 4 of part H of chapter 577 of the laws of 2004, is
amended to read as follows:
(2) Amount of credit. The amount of the credit shall be twenty-five
percent of the product of (i) the benefit period factor, (ii) the
employment number factor, and (iii) the eligible real property taxes
paid [or incurred] by the developer of the qualified site during the
taxable year (or the pro rata share of such taxes in the case of a part-
ner in a partnership or a shareholder in a New York S corporation),
except that if the real property which is the subject of the credit
provided for under this section is attributed to a qualified site
located in an environmental zone as defined in paragraph five of subdi-
vision (a) of this section, the amount of the credit shall be the prod-
uct of the factors and taxes referred to in subparagraphs (i), (ii) and
(iii) of this paragraph. However, the amount of the credit may not
exceed the credit limitation set forth in paragraph seven of this subdi-
vision.
S 29. Section 171-r of the tax law is amended by adding a new subdivi-
sion (e) to read as follows:
(E) THE COMMISSIONER, IN CONSULTATION WITH THE COMMISSIONER OF ENVI-
RONMENTAL CONSERVATION, SHALL PUBLISH BY JANUARY THIRTY-FIRST, TWO THOU-
SAND FIFTEEN A SUPPLEMENTAL BROWNFIELD CREDIT REPORT CONTAINING THE
INFORMATION REQUIRED BY THIS SECTION ABOUT THE CREDITS CLAIMED FOR THE
YEARS TWO THOUSAND FIVE, TWO THOUSAND SIX, AND TWO THOUSAND SEVEN.
S 30. Section 171-s of the tax law is REPEALED.
S 31. Section 970-r of the general municipal law is amended by adding
a new subdivision 10 to read as follows:
10. THE SECRETARY SHALL ESTABLISH CRITERIA FOR BROWNFIELD OPPORTUNITY
AREA CONFORMANCE DETERMINATIONS FOR PURPOSES OF THE BROWNFIELD CLEANUP
PROGRAM PURSUANT TO TITLE FOURTEEN OF ARTICLE TWENTY-SEVEN OF THE ENVI-
RONMENTAL CONSERVATION LAW AND THE BROWNFIELD REDEVELOPMENT TAX CREDITS
PURSUANT TO SECTION TWENTY-ONE OF THE TAX LAW. IN ESTABLISHING CRITE-
RIA, THE SECRETARY SHALL BE GUIDED BY, BUT NOT LIMITED TO, THE FOLLOWING
CONSIDERATIONS: HOW THE PROPOSED USE AND DEVELOPMENT ADVANCES THE DESIG-
NATED BROWNFIELD OPPORTUNITY AREA PLAN'S VISION STATEMENT, GOALS AND
OBJECTIVES FOR REVITALIZATION; HOW THE DENSITY OF DEVELOPMENT AND ASSO-
CIATED BUILDINGS AND STRUCTURES ADVANCES THE PLAN'S OBJECTIVES, DESIRED
REDEVELOPMENT AND PRIORITIES FOR INVESTMENT; AND HOW THE PROJECT
COMPLIES WITH ZONING AND OTHER LOCAL LAWS AND STANDARDS TO GUIDE AND
ENSURE APPROPRIATE USE OF THE PROJECT SITE.
S 32. Section 31 of part H of chapter 1 of the laws of 2003, amending
the tax law relating to brownfield redevelopment tax credits, remediated
brownfield credit for real property taxes for qualified sites and envi-
ronmental remediation insurance credits, as amended by chapter 474 of
the laws of 2012, is amended to read as follows:
S 31. The tax credits allowed under section [21,] 22 or 23 of the tax
law and the corresponding provisions in articles 9, 9-A, 22, 32 and 33
of the tax law, as added by the provisions of sections one through twen-
ty-nine of this act, shall not be applicable [if] TO ANY SITE ACCEPTED
S. 6359 207 A. 8559
INTO THE BROWNFIELD CLEANUP PROGRAM ON AND AFTER JULY 1, 2014. THE TAX
CREDITS ALLOWED UNDER SECTION 21 OF THE TAX LAW AND THE CORRESPONDING
PROVISIONS IN ARTICLES 9, 9-A, 22, 32 AND 33 OF THE TAX LAW, AS ADDED BY
THE PROVISIONS OF SECTIONS ONE THROUGH TWENTY-NINE OF THIS ACT, SHALL
NOT BE APPLICABLE TO ANY SITE ACCEPTED INTO THE BROWNFIELD CLEANUP
PROGRAM AFTER DECEMBER 31, 2022, PROVIDED, HOWEVER THAT ANY SITES
ACCEPTED ON OR BEFORE DECEMBER 31, 2022 MUST HAVE RECEIVED the [remedi-
ation] certificate OF COMPLETION required to qualify for any of such
credits [is issued after] BY December 31, [2015] 2025.
S 33. Any site for which a brownfield cleanup agreement with the
department of environmental conservation was entered into (1) prior to
June 23, 2008 and which has not received a certificate of completion by
December 31, 2015 or (2) on or after June 23, 2008 and prior to July 1,
2014 which has not received a certificate of completion by December 31,
2017, shall be terminated from the brownfield cleanup program. If such a
site reapplies for acceptance into the brownfield cleanup program, it
shall be accepted into the program subject to all the requirements of
title 14 of article 27 of the environmental conservation law in effect
at the time of acceptance.
S 34. Paragraph c of subdivision 3 of section 27-0923 of the environ-
mental conservation law, as amended by section 5 of part I of chapter
577 of the laws of 2004, is amended to read as follows:
c. For the purpose of this section, generation of hazardous waste
shall not include retrieval or creation of hazardous waste which must be
disposed of under an order of or agreement with the department pursuant
to title thirteen or title fourteen of this article or under a contract
OR AGREEMENT with the department pursuant to title five of article
fifty-six of this chapter OR UNDER AN ORDER OF OR AGREEMENT WITH THE
UNITED STATES ENVIRONMENTAL PROTECTION AGENCY OR AN ORDER OF A COURT OF
COMPETENT JURISDICTION, RELATED TO A FACILITY ADDRESSED PURSUANT TO THE
COMPREHENSIVE ENVIRONMENTAL RESPONSE, COMPENSATION AND LIABILITY ACT (42
U.S.C. 9601 ET SEQ.) OR UNDER A WRITTEN AGREEMENT WITH A MUNICIPALITY
WHICH IS SUBJECT TO A MEMORANDUM OF AGREEMENT WITH THE DEPARTMENT
RELATED TO THE REMEDIATION OF BROWNFIELD SITES.
S 35. Subparagraphs (i) and (vi) of paragraph d of subdivision 1 of
section 72-0402 of the environmental conservation law, as amended by
chapter 99 of the laws of 2010, are amended to read as follows:
(i) under a contract with the department, or with the department's
written approval and in compliance with department regulations, or
pursuant to an order of the department, the United States environmental
protection agency or a court OF COMPETENT JURISDICTION, related to the
cleanup or remediation of a hazardous materials or hazardous waste
spill, discharge, or surficial cleanup, pursuant to this chapter; or
(vi) under a brownfield site cleanup agreement with the department
pursuant to section 27-1409 of this chapter OR UNDER AN AGREEMENT WITH A
MUNICIPALITY WHICH IS SUBJECT TO A MEMORANDUM OF AGREEMENT WITH THE
DEPARTMENT RELATED TO THE REMEDIATION OF BROWNFIELD SITES; or
S 36. Subdivision 1 of section 1285-q of the public authorities law,
as added by section 6 of part I of chapter 1 of the laws of 2003, is
amended to read as follows:
1. Subject to chapter fifty-nine of the laws of two thousand, but
notwithstanding any other provisions of law to the contrary, in order to
assist the corporation in undertaking the administration and the financ-
ing of hazardous waste site remediation projects for payment of the
state's share of the costs of the remediation of hazardous waste sites,
in accordance with title thirteen of article twenty-seven of the envi-
S. 6359 208 A. 8559
ronmental conservation law and section ninety-seven-b of the state
finance law, and for payment of state costs associated with the remedi-
ation of offsite contamination at significant threat sites as provided
in section 27-1411 of the environmental conservation law, AND FOR ENVI-
RONMENTAL RESTORATION PROJECTS PURSUANT TO TITLE FIVE OF ARTICLE FIFTY-
SIX OF THE ENVIRONMENTAL CONSERVATION LAW pursuant to capital appropri-
ations made to the department of environmental conservation, the
director of the division of budget and the corporation are each author-
ized to enter into one or more service contracts, none of which shall
exceed twenty years in duration, upon such terms and conditions as the
director and the corporation may agree, so as to annually provide to the
corporation in the aggregate, a sum not to exceed the annual debt
service payments and related expenses required for any bonds and notes
authorized pursuant to section twelve hundred ninety of this title. Any
service contract entered into pursuant to this section shall provide
that the obligation of the state to fund or to pay the amounts therein
provided for shall not constitute a debt of the state within the meaning
of any constitutional or statutory provision and shall be deemed execu-
tory only to the extent of moneys available for such purposes, subject
to annual appropriation by the legislature. Any such service contract or
any payments made or to be made thereunder may be assigned and pledged
by the corporation as security for its bonds and notes, as authorized
pursuant to section twelve hundred ninety of this title.
S 37. Section 56-0501 of the environmental conservation law, as added
by chapter 413 of the laws of 1996, is amended to read as follows:
S 56-0501. Allocation of moneys.
1. Of the moneys received by the state from the sale of bonds pursuant
to the Clean Water/Clean Air Bond Act of 1996, two hundred million
dollars ($200,000,000) shall be available for disbursements for environ-
mental restoration projects.
2. ENVIRONMENTAL RESTORATION PROJECTS MAY BE FUNDED USING THE PROCEEDS
OF BONDS ISSUED PURSUANT TO SECTION TWELVE HUNDRED EIGHTY-FIVE-Q OF THE
PUBLIC AUTHORITIES LAW.
S 38. Subdivision 6 of section 56-0502 of the environmental conserva-
tion law, as amended by section 2 of part D of chapter 577 of the laws
of 2004, is amended to read as follows:
6. "State assistance", for purposes of this title, shall mean in the
case of a contract authorized by subdivision one of section 56-0503 of
this title, payments made to a municipality to reimburse the munici-
pality for the state share of the costs incurred by the municipality to
undertake an environmental restoration project OR IN THE CASE OF AN
AGREEMENT AUTHORIZED BY SUBDIVISION THREE OF SECTION 56-0503 OF THIS
TITLE, COSTS INCURRED BY THE STATE TO UNDERTAKE AN ENVIRONMENTAL RESTO-
RATION PROJECT BUT NOT REIMBURSED BY A MUNICIPALITY.
S 39. Paragraph (c) of subdivision 2 of section 56-0503 of the envi-
ronmental conservation law, as amended by section 4 of part D of chapter
1 of the laws of 2003, is amended and a new subdivision 3 is added to
read as follows:
(c) A provision that THE MUNICIPALITY SHALL ASSIST IN IDENTIFYING A
RESPONSIBLE PARTY BY SEARCHING LOCAL RECORDS, INCLUDING PROPERTY TAX
ROLLS, OR DOCUMENT REVIEWS, AND if, in accordance with the required
departmental approval of any settlement with a responsible party, any
responsible party payments become available to the municipality, before,
during or after the completion of an environmental restoration project,
which were not included when the state share was calculated pursuant to
this section, the state assistance share shall be recalculated, and the
S. 6359 209 A. 8559
municipality shall pay to the state, for deposit into the environmental
restoration project account of the hazardous waste remedial fund estab-
lished under section ninety-seven-b of the state finance law, the
difference between the original state assistance payment and the recal-
culated state share. Recalculation of the state share shall be done each
time a payment from a responsible party is received by the municipality;
3. THE DEPARTMENT MAY UNDERTAKE AN ENVIRONMENTAL RESTORATION PROJECT
ON BEHALF OF A MUNICIPALITY UPON REQUEST. IF THE DEPARTMENT UNDERTAKES
THE PROJECT ON BEHALF OF THE MUNICIPALITY, THE STATE SHALL ENTER INTO AN
AGREEMENT WITH THE MUNICIPALITY AND THE AGREEMENT SHALL REQUIRE THE
MUNICIPALITY TO PERIODICALLY PROVIDE ITS SHARE TO THE STATE FOR COSTS
INCURRED DURING THE PROGRESS OF SUCH PROJECT. THE MUNICIPALITY'S SHARE
SHALL BE THE SAME AS WOULD BE REQUIRED UNDER SUBDIVISION ONE OF THIS
SECTION. THE AGREEMENT SHALL INCLUDE ALL PROVISIONS SPECIFIED IN SUBDI-
VISION TWO OF THIS SECTION AS APPROPRIATE. FOR PURPOSES OF PROJECTS
SUBJECT TO AGREEMENTS UNDER THIS SUBDIVISION, ALL REFERENCES TO
CONTRACTS IN THIS TITLE SHALL ALSO APPLY TO AGREEMENTS UNDER THIS SUBDI-
VISION AS APPROPRIATE.
S 40. Subdivision 4 of section 56-0505 of the environmental conserva-
tion law, as amended by section 5 of part D of chapter 1 of the laws of
2003, is amended to read as follows:
4. After completion of such project, the municipality may use the
property for public purposes or may dispose of it. If the municipality
shall dispose of such property by sale to a responsible party, such
party shall pay to such municipality, in addition to such other consid-
eration, an amount of money constituting the amount of state assistance
provided [to the municipality] under this title plus accrued interest
and transaction costs and the municipality shall deposit that money into
the environmental restoration project account of the hazardous waste
remedial fund established under section ninety-seven-b of the state
finance law.
S 41. Subdivisions 3 and 4 of section 56-0508 of the environmental
conservation law, as added by section 7 of part D of chapter 1 of the
laws of 2003, are amended to read as follows:
3. such temporary incidents of ownership by such taxing district shall
also qualify it as being the owner of such property [for the purposes of
obtaining] TO BE ELIGIBLE FOR funding from the state of New York for
such environmental restoration investigation project under this article
or for such funding from any source pursuant to any other state, feder-
al, or local law, but such incidents of ownership shall not be suffi-
cient to qualify it as the owner of such property for the purposes of
holding it wholly or partially liable for any damages, past, present, or
future from any release of any hazardous material, substance, or contam-
inant into the air, ground, or water, unless such release was caused by
such taxing district.
4. within thirty days of the completion of the environmental restora-
tion investigation project and the receipt by the taxing jurisdiction of
the final report of such investigation, such taxing jurisdiction shall
file such report with the court on notice to the court and all other
parties of record, and the stay of the foreclosure shall be lifted
(unless lifted earlier by a prior court order), and all incidents of
temporary ownership of the taxing jurisdiction that was awarded such
taxing district, except any right [to receive funding] for the environ-
mental restoration investigation project TO BE FUNDED, shall cease to
exist, and nothing in this subdivision shall preclude the taxing juris-
diction that conducted the environmental restoration investigation
S. 6359 210 A. 8559
project or the taxing jurisdiction that commenced the foreclosure
action, if it is a different taxing jurisdiction than the taxing juris-
diction which conducted the investigation, from withdrawing the parcel
from foreclosure pursuant to section eleven hundred thirty-eight of the
real property tax law.
S 42. Subdivision 2 and paragraph (f) of subdivision 3 of section 97-b
of the state finance law, as amended by section 4 of part I of chapter 1
of the laws of 2003, are amended to read as follows:
2. Such fund shall consist of all of the following:
(a) moneys appropriated for transfer to the fund's site investigation
and construction account; (b) all fines and other sums accumulated in
the fund prior to April first, nineteen hundred eighty-eight pursuant to
section 71-2725 of the environmental conservation law for deposit in the
fund's site investigation and construction account; (c) all moneys
collected or received by the department of taxation and finance pursuant
to section 27-0923 of the environmental conservation law for deposit in
the fund's industry fee transfer account; (d) all moneys paid into the
fund pursuant to section 72-0201 of the environmental conservation law
which shall be deposited in the fund's industry fee transfer account;
(e) all moneys paid into the fund pursuant to section one hundred eight-
y-six of the navigation law which shall be deposited in the fund's
industry fee transfer account; (f) [all moneys paid into the fund by
municipalities for repayment of landfill closure loans made pursuant to
title five of article fifty-two of the environmental conservation law
for deposit in the fund's site investigation and construction account;
(g)] all monies recovered under sections 56-0503, 56-0505 and 56-0507 of
the environmental conservation law into the fund's environmental resto-
ration project account; [(h) all] (G) fees paid into the fund pursuant
to section [72-0403] 72-0402 of the environmental conservation law which
shall be deposited in the fund's industry fee transfer account; [(i)]
(H) payments received for all state costs incurred in negotiating and
overseeing the implementation of brownfield site cleanup agreements
pursuant to title fourteen OF ARTICLE TWENTY-SEVEN of the environmental
conservation law shall be deposited in the hazardous waste remediation
oversight and assistance account; and [(j)] (I) other moneys credited or
transferred thereto from any other fund or source for deposit in the
fund's site investigation and construction account.
(f) to undertake such remedial measures as the department of environ-
mental conservation may determine necessary due to environmental condi-
tions related to the property subject to an agreement [to provide state
assistance] OR CONTRACT under title five of article fifty-six of the
environmental conservation law [that were unknown to such department at
the time of its approval of such agreement which indicates that condi-
tions on such property are not sufficiently protective of human health
for its reasonably anticipated uses or due to information received, in
whole or in part, after such department's approval of such agreement's
final engineering report and certification], which indicates that such
agreement's remedial activities are not sufficiently protective of human
health for such property's reasonably anticipated uses; and, [respecting
the monies in the environmental restoration project account in excess of
ten million dollars,] shall provide state assistance under title five of
article fifty-six of the environmental conservation law;
S 43. Severability. If any clause, sentence, paragraph, subdivision,
section or part of this act shall be adjudged by any court of competent
jurisdiction to be invalid, such judgment shall not affect, impair or
invalidate the remainder thereof, but shall be confined in its operation
S. 6359 211 A. 8559
to the clause, sentence, paragraph, subdivision, section or part thereof
directly involved in the controversy in which such judgment shall have
been rendered. It is hereby declared to be the intent of the legislature
that this act would have been enacted even if such invalid provisions
had not been included herein.
S 44. This act shall take effect July 1, 2014; provided, however, that
the department of environmental conservation shall not charge volunteers
in the brownfield cleanup program for oversight costs for any sites in
the program incurred on or after July 1, 2014.
PART R
Section 1. Section 208 of the tax law is amended by adding three new
subdivisions 13, 14 and 15 to read as follows:
13. THE TERM "MANUFACTURER" MEANS A TAXPAYER OR, IN THE CASE OF A
COMBINED REPORT, A COMBINED GROUP, THAT, DURING THE TAXABLE YEAR, IS
PRINCIPALLY ENGAGED IN MANUFACTURING. A TAXPAYER OR A COMBINED GROUP IS
PRINCIPALLY ENGAGED IN MANUFACTURING IF MORE THAN FIFTY PERCENT OF THE
GROSS RECEIPTS OF THE TAXPAYER OR THE COMBINED GROUP, RESPECTIVELY,
DURING THE TAXABLE YEAR ARE DERIVED FROM THE SALE OF GOODS PRODUCED BY
MANUFACTURING. IN COMPUTING A COMBINED GROUP'S GROSS RECEIPTS, INTERCOR-
PORATE RECEIPTS SHALL BE ELIMINATED. IN COMPUTING GROSS RECEIPTS FOR A
TAXPAYER THAT IS A PARTNER IN PARTNERSHIP, INTER-ENTITY RECEIPTS BETWEEN
THE TAXPAYER AND SUCH PARTNERSHIP SHALL BE ELIMINATED.
14. (A) THE TERM "MANUFACTURING" MEANS 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.
(B) NOTWITHSTANDING THE DEFINITION OF MANUFACTURING IN PARAGRAPH (A)
OF THIS SUBDIVISION:
(I) THE GENERATION AND DISTRIBUTION OF ELECTRICITY, THE EXTRACTION AND
DISTRIBUTION OF NATURAL GAS, AND THE PRODUCTION OF STEAM ASSOCIATED WITH
THE GENERATION OF ELECTRICITY DOES NOT CONSTITUTE MANUFACTURING.
(II) THE CREATION, PRODUCTION OR REPRODUCTION OF A FILM, TELEVISION
SHOW OR COMMERCIAL DOES NOT CONSTITUTE MANUFACTURING.
(III) THE BLENDING OF TWO OR MORE FUELS DOES NOT CONSTITUTE MANUFAC-
TURING.
(IV) THE MASS PRODUCTION OF FOOD PRODUCTS FOR WHOLESALE COMMERCIAL
DISTRIBUTION AND SALE CONSTITUTES MANUFACTURING.
15. THE TERM "QUALIFIED NEW YORK MANUFACTURER" MEANS A MANUFACTURER
THAT HAS PROPERTY IN THE STATE THAT IS USED IN MANUFACTURING AND EITHER
THE FAIR MARKET VALUE OF THAT PROPERTY AT THE CLOSE OF THE TAXABLE YEAR
IS AT LEAST TEN MILLION DOLLARS OR ALL OF ITS REAL AND PERSONAL PROPERTY
IS LOCATED IN NEW YORK. A TAXPAYER OR, IN THE CASE OF A COMBINED REPORT,
A COMBINED GROUP, THAT DOES NOT SATISFY THE CRITERIA IN SUBDIVISION
THIRTEEN OF THIS SECTION MAY BE A QUALIFIED NEW YORK MANUFACTURER IF THE
TAXPAYER OR THE COMBINED GROUP EMPLOYS DURING THE TAXABLE YEAR AT LEAST
TWO THOUSAND FIVE HUNDRED EMPLOYEES IN MANUFACTURING IN NEW YORK AND THE
TAXPAYER OR THE COMBINED GROUP HAS PROPERTY IN THE STATE USED IN MANU-
FACTURING, THE ADJUSTED BASIS OF WHICH FOR FEDERAL INCOME TAX PURPOSES
AT THE CLOSE OF THE TAXABLE YEAR IS AT LEAST ONE HUNDRED MILLION
DOLLARS.
S 2. Section 210 of the tax law is amended by adding a new subdivision
48 to read as follows:
S. 6359 212 A. 8559
48. REAL PROPERTY TAX CREDIT FOR MANUFACTURERS. (A) A QUALIFIED NEW
YORK MANUFACTURER, AS DEFINED IN SUBDIVISION FIFTEEN OF SECTION TWO
HUNDRED EIGHT OF THIS ARTICLE, WILL BE ALLOWED A CREDIT EQUAL TO TWENTY
PERCENT OF THE REAL PROPERTY TAX IT PAID DURING THE TAXABLE YEAR FOR
REAL PROPERTY OWNED BY SUCH MANUFACTURER IN NEW YORK WHICH WAS PRINCI-
PALLY USED DURING THE TAXABLE YEAR FOR MANUFACTURING TO THE EXTENT NOT
DEDUCTED IN DETERMINING ENTIRE NET INCOME. THIS CREDIT WILL NOT BE
ALLOWED IF THE REAL PROPERTY TAXES THAT ARE THE BASIS FOR THIS CREDIT
ARE INCLUDED IN THE CALCULATION OF ANOTHER CREDIT CLAIMED BY THE TAXPAY-
ER.
(B) FOR PURPOSES OF THIS SUBDIVISION, THE TERM REAL PROPERTY TAX MEANS
A CHARGE IMPOSED UPON REAL PROPERTY BY OR ON BEHALF OF A COUNTY, CITY,
TOWN, VILLAGE OR SCHOOL DISTRICT FOR MUNICIPAL OR SCHOOL DISTRICT
PURPOSES, PROVIDED THAT THE CHARGE IS LEVIED FOR THE GENERAL PUBLIC
WELFARE BY THE PROPER TAXING AUTHORITIES AT A LIKE RATE AGAINST ALL
PROPERTY OVER WHICH SUCH AUTHORITIES HAVE JURISDICTION, AND PROVIDED
THAT WHERE TAXES ARE LEVIED PURSUANT TO ARTICLE EIGHTEEN OR NINETEEN OF
THE REAL PROPERTY TAX LAW, THE PROPERTY MUST HAVE BEEN TAXED AT THE RATE
DETERMINED FOR THE CLASS IN WHICH IT IS CONTAINED, AS PROVIDED BY SUCH
ARTICLE EIGHTEEN OR NINETEEN, WHICHEVER IS APPLICABLE. THE TERM REAL
PROPERTY TAX DOES NOT INCLUDE A CHARGE FOR LOCAL BENEFITS, INCLUDING ANY
PORTION OF THAT CHARGE THAT IS PROPERLY ALLOCATED TO THE COSTS ATTRIBUT-
ABLE TO MAINTENANCE OR INTEREST, WHEN (1) THE PROPERTY SUBJECT TO THE
CHARGE IS LIMITED TO THE PROPERTY THAT BENEFITS FROM THE CHARGE, OR (2)
THE AMOUNT OF THE CHARGE IS DETERMINED BY THE BENEFIT TO THE PROPERTY
ASSESSED, OR (3) THE IMPROVEMENT FOR WHICH THE CHARGE IS ASSESSED TENDS
TO INCREASE THE PROPERTY VALUE. THE TERM REAL PROPERTY TAX DOES NOT
INCLUDE A PAYMENT IN LIEU OF TAXES MADE BY THE QUALIFIED NEW YORK
MANUFACTURER.
(C) CREDIT RECAPTURE. WHERE A QUALIFIED NEW YORK MANUFACTURER'S REAL
PROPERTY TAXES WHICH WERE THE BASIS FOR THE ALLOWANCE OF THE CREDIT
PROVIDED FOR UNDER THIS SUBDIVISION ARE SUBSEQUENTLY REDUCED AS A RESULT
OF A FINAL ORDER IN ANY PROCEEDING UNDER ARTICLE SEVEN OF THE REAL PROP-
ERTY TAX LAW OR OTHER PROVISION OF LAW, THE TAXPAYER SHALL ADD BACK, IN
THE TAXABLE YEAR IN WHICH SUCH FINAL ORDER IS ISSUED, THE EXCESS OF (1)
THE AMOUNT OF CREDIT ORIGINALLY ALLOWED FOR A TAXABLE YEAR OVER (2) THE
AMOUNT OF CREDIT DETERMINED BASED UPON THE REDUCED REAL PROPERTY TAXES.
IF SUCH FINAL ORDER REDUCES REAL PROPERTY TAXES FOR MORE THAN ONE YEAR,
THE TAXPAYER MUST DETERMINE HOW MUCH OF SUCH REDUCTION IS ATTRIBUTABLE
TO EACH YEAR COVERED BY SUCH FINAL ORDER AND CALCULATE THE AMOUNT OF
CREDIT WHICH IS REQUIRED BY THIS SUBDIVISION TO BE RECAPTURED FOR EACH
YEAR BASED ON SUCH REDUCTION.
(D) 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,
ANY AMOUNT OF CREDIT NOT DEDUCTIBLE IN SUCH TAXABLE YEAR SHALL BE TREAT-
ED 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 THOU-
SAND EIGHTY-EIGHT OF THIS CHAPTER NOTWITHSTANDING, NO INTEREST SHALL BE
PAID THEREON.
S 3. Subparagraph (B) of paragraph 1 of subsection (i) of section 606
of the tax law is amended by adding a new clause (xxxvii) to read as
follows:
(XXXVII) REAL PROPERTY TAX AMOUNT OF CREDIT UNDER
S. 6359 213 A. 8559
CREDIT FOR MANUFACTURERS UNDER SUBDIVISION FORTY-EIGHT OF
SUBSECTION (XX) SECTION TWO HUNDRED TEN
S 4. Subsections (yy) and (zz) of section 606 of the tax law, as
relettered by section 5 of part H of chapter 1 of the laws of 2003, are
relettered subsections (yyy) and (zzz) and a new subsection (xx) is
added to read as follows:
(XX) REAL PROPERTY TAX CREDIT FOR MANUFACTURERS. (1) A QUALIFIED NEW
YORK MANUFACTURER WILL BE ALLOWED A CREDIT EQUAL TO TWENTY PERCENT OF
THE REAL PROPERTY TAX IT PAID DURING THE TAXABLE YEAR FOR REAL PROPERTY
OWNED BY SUCH MANUFACTURER IN NEW YORK WHICH WAS PRINCIPALLY USED DURING
THE TAXABLE YEAR FOR MANUFACTURING TO THE EXTENT NOT DEDUCTED IN COMPUT-
ING FEDERAL ADJUSTED GROSS INCOME. THIS CREDIT WILL NOT BE ALLOWED IF
THE REAL PROPERTY TAXES THAT ARE THE BASIS FOR THIS CREDIT ARE INCLUDED
IN THE CALCULATION OF ANOTHER CREDIT CLAIMED BY THE TAXPAYER.
(2)(A) THE TERM QUALIFIED NEW YORK MANUFACTURER HAS THE SAME MEANING
AS UNDER SUBPARAGRAPH (B) OF PARAGRAPH TWO OF SUBSECTION (A) OF THIS
SECTION.
(B) THE TERM REAL PROPERTY TAX MEANS A CHARGE IMPOSED UPON REAL PROP-
ERTY BY OR ON BEHALF OF A COUNTY, CITY, TOWN, VILLAGE OR SCHOOL DISTRICT
FOR MUNICIPAL OR SCHOOL DISTRICT PURPOSES, PROVIDED THAT THE CHARGE IS
LEVIED FOR THE GENERAL PUBLIC WELFARE BY THE PROPER TAXING AUTHORITIES
AT A LIKE RATE AGAINST ALL PROPERTY OVER WHICH SUCH AUTHORITIES HAVE
JURISDICTION, AND PROVIDED THAT WHERE TAXES ARE LEVIED PURSUANT TO ARTI-
CLE EIGHTEEN OR NINETEEN OF THE REAL PROPERTY TAX LAW, THE PROPERTY MUST
HAVE BEEN TAXED AT THE RATE DETERMINED FOR THE CLASS IN WHICH IT IS
CONTAINED, AS PROVIDED BY SUCH ARTICLE EIGHTEEN OR NINETEEN, WHICHEVER
IS APPLICABLE. THE TERM REAL PROPERTY TAX DOES NOT INCLUDE A CHARGE FOR
LOCAL BENEFITS, INCLUDING ANY PORTION OF THAT CHARGE THAT IS PROPERLY
ALLOCATED TO THE COSTS ATTRIBUTABLE TO MAINTENANCE OR INTEREST, WHEN (I)
THE PROPERTY SUBJECT TO THE CHARGE IS LIMITED TO THE PROPERTY THAT BENE-
FITS FROM THE CHARGE, OR (II) THE AMOUNT OF THE CHARGE IS DETERMINED BY
THE BENEFIT TO THE PROPERTY ASSESSED, OR (III) THE IMPROVEMENT FOR WHICH
THE CHARGE IS ASSESSED TENDS TO INCREASE THE PROPERTY VALUE. THE TERM
REAL PROPERTY TAX DOES NOT INCLUDE A PAYMENT IN LIEU OF TAXES MADE BY
THE QUALIFIED NEW YORK MANUFACTURER.
(3) CREDIT RECAPTURE. WHERE A QUALIFIED NEW YORK MANUFACTURER'S REAL
PROPERTY TAXES WHICH WERE THE BASIS FOR THE ALLOWANCE OF THE CREDIT
PROVIDED FOR UNDER THIS SUBDIVISION ARE SUBSEQUENTLY REDUCED AS A RESULT
OF A FINAL ORDER IN ANY PROCEEDING UNDER ARTICLE SEVEN OF THE REAL PROP-
ERTY TAX LAW OR OTHER PROVISION OF LAW, THE TAXPAYER SHALL ADD BACK, IN
THE TAXABLE YEAR IN WHICH SUCH FINAL ORDER IS ISSUED, THE EXCESS OF (I)
THE AMOUNT OF CREDIT ORIGINALLY ALLOWED FOR A TAXABLE YEAR OVER (II) THE
AMOUNT OF CREDIT DETERMINED BASED UPON THE REDUCED REAL PROPERTY TAXES.
IF SUCH FINAL ORDER REDUCES REAL PROPERTY TAXES FOR MORE THAN ONE YEAR,
THE TAXPAYER MUST DETERMINE HOW MUCH OF SUCH REDUCTION IS ATTRIBUTABLE
TO EACH YEAR COVERED BY SUCH FINAL ORDER AND CALCULATE THE AMOUNT OF
CREDIT WHICH IS REQUIRED BY THIS SUBDIVISION TO BE RECAPTURED FOR EACH
YEAR BASED ON SUCH REDUCTION.
(4) IF THE AMOUNT OF THE CREDIT ALLOWED UNDER THIS SUBSECTION FOR ANY
TAXABLE YEAR EXCEEDS THE TAXPAYER'S TAX FOR SUCH YEAR, THE EXCESS WILL
BE TREATED AS AN OVERPAYMENT TO BE CREDITED OR REFUNDED IN ACCORDANCE
WITH THE PROVISIONS OF SECTION SIX HUNDRED EIGHTY-SIX OF THIS ARTICLE,
PROVIDED HOWEVER, NO INTEREST WILL BE PAID THEREON.
S 5. Paragraph (b) of subdivision 12 of section 210 of the tax law, as
amended by chapter 817 of the laws of 1987, subparagraph (i) as amended
S. 6359 214 A. 8559
by chapter 637 of the laws of 2008 and clause (E) of subparagraph (ii)
as added by chapter 393 of the laws of 2005, is amended to read as
follows:
(b) (i) A credit shall be allowed under this subdivision TO A QUALI-
FIED NEW YORK MANUFACTURER, A QUALIFIED NEW YORK AGRICULTURAL BUSINESS
OR A QUALIFIED NEW YORK MINING BUSINESS with respect to tangible
personal property and other tangible property, including buildings and
structural components of buildings, which (A) are[:] depreciable pursu-
ant to section one hundred sixty-seven of the internal revenue code, (B)
have a useful life of four years or more, (C) are acquired by purchase
as defined in section one hundred seventy-nine (d) of the internal
revenue code, (D) HAVE NOT BEEN PREVIOUSLY THE SUBJECT OF AN INVESTMENT
TAX CREDIT OR EMPIRE ZONE INVESTMENT TAX CREDIT ALLOWED UNDER THIS CHAP-
TER TO ANOTHER TAXPAYER, (E) have a situs in this state, and (F) 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 commer-
cial fishing, (B) industrial waste treatment facilities or air pollution
control facilities, used in the taxpayer's trade or business, (C)] FOR
SALE OR ARE 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
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) princi-
pally 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 elec-
trical capacity, food services, security services, and heating, venti-
lation 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, registered investment adviser, national secu-
rities exchange or board of trade, is allowed a credit under this subdi-
vision if the property is used by its affiliated regulated broker, deal-
er, registered investment adviser, national securities exchange or board
S. 6359 215 A. 8559
of trade in accordance with this subdivision. For purposes of determin-
ing if the property is principally used in qualifying uses, the uses by
the taxpayer described in clauses (D) and (E) 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 of those clauses may be aggregated. Provided, however, a
taxpayer shall not be allowed the credit provided by clauses (D), (E)
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
administrative and support functions resulting from or related to the
qualifying 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,
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].
(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 artifi-
cial process by the use of machinery, tools, appliances and other simi-
lar equipment.] Property used in the production of goods FOR SALE shall
include machinery, equipment or other tangible property which is princi-
pally used in the repair and service of other machinery, equipment or
other tangible property used principally in the production of goods FOR
SALE 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 ordi-
nary testing or inspection of materials or products for quality control,
efficiency surveys, management studies, consumer surveys, advertising,
S. 6359 216 A. 8559
promotions, or research in connection with literary, historical or simi-
lar projects.
(C) [Industrial waste treatment facilities shall mean property consti-
tuting 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 exclud-
ing such facilities installed for the primary purpose of salvaging mate-
rials which are usable in the manufacturing process or are marketable.]
A QUALIFIED NEW YORK AGRICULTURAL BUSINESS SHALL MEAN A TAXPAYER OR, IN
THE CASE OF A COMBINED REPORT, A COMBINED GROUP, PRINCIPALLY ENGAGED IN
FARMING, AGRICULTURE, HORTICULTURE, FLORICULTURE, VITICULTURE OR COMMER-
CIAL FISHING IN THE STATE. A TAXPAYER OR A COMBINED GROUP IS PRINCIPALLY
ENGAGED IN FARMING, AGRICULTURE, HORTICULTURE, FLORICULTURE, VITICULTURE
OR COMMERCIAL FISHING IN THE STATE IF MORE THAN FIFTY PERCENT OF THE
GROSS RECEIPTS OF THE TAXPAYER OR THE COMBINED GROUP, RESPECTIVELY,
DURING THE TAXABLE YEAR ARE DERIVED FROM THE SALE OF GOODS PRODUCED BY
THE TAXPAYER BY ANY OF THE ACTIVITIES SPECIFIED IN THIS SENTENCE THAT
ARE CONDUCTED IN THE STATE. IN COMPUTING A COMBINED GROUP'S GROSS
RECEIPTS, INTERCORPORATE RECEIPTS SHALL BE ELIMINATED. IN COMPUTING
GROSS RECEIPTS FOR A TAXPAYER THAT IS A PARTNER IN PARTNERSHIP,
INTER-ENTITY RECEIPTS BETWEEN THE TAXPAYER AND SUCH PARTNERSHIP SHALL BE
ELIMINATED.
(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 manu-
facturing process or are marketable and excluding those facilities which
rely for their efficacy on dilution, dispersion or assimilation of air
contaminants in the amb