senate Bill S2221A

2013-2014 Legislative Session

Relates to tax credits for certain rehabilitation projects

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Archive: Last Bill Status - In Committee


  • Introduced
  • In Committee
  • On Floor Calendar
    • Passed Senate
    • Passed Assembly
  • Delivered to Governor
  • Signed/Vetoed by Governor

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Assembly Actions - Lowercase
Senate Actions - UPPERCASE
Jan 29, 2014 print number 2221a
amend and recommit to investigations and government operations
Jan 08, 2014 referred to investigations and government operations
Jan 14, 2013 referred to investigations and government operations

Bill Amendments

Original
A (Active)
Original
A (Active)

S2221 - Bill Details

Current Committee:
Law Section:
Tax Law
Laws Affected:
Amd §§606, 210, 1456 & 1511, Tax L

S2221 - Bill Texts

view summary

Relates to tax credits for certain rehabilitation projects.

view sponsor memo
BILL NUMBER:S2221

TITLE OF BILL: An act to amend the tax law, in relation to credits
for certain rehabilitation projects; and providing for the repeal of
such provisions upon expiration thereof

PURPOSE: To strengthen the existing historic rehabilitation tax
credit by allowing for a partnership/LLC to allocate the state tax
credit separately from the federal tax credit.

SUMMARY OF PROVISIONS:

Section 1 states the tax credit in section 606 (Personal Income Tax)
shall be allowed to a partnership, LLC, subchapter S corp., or other
business entity and shall be passed through to the partners, members
or share-holders respectively. Credits allowed to these entities shall
be allocated among all partners without regard to their sharing of
other tax or economic attributes of the entity.

Section 2 states the tax credit in section 210 (Franchise Tax on
Business Corporations) shall be allowed to a partnership, LLC,
subchapter S corp., or other business entity and shall be passed
through to the partners, members or share-holders respectively.
Credits allowed to these entities shall be allocated among all
partners without regard to their sharing of other tax or economic
attributes of the entity.

Section 3 states the tax credit in section 1456 (Franchise Tax on
Banking Corporations )shall be allowed to a partnership, LLC,
subchapter S corp., or other business entity and shall be passed
through to the partners, members or share-holders respectively.
Credits allowed to these entities shall be allocated among all
partners without regard to their sharing of other tax or economic
attributes of the entity.

Section 4 states the tax credit in section 1511(Franchise Taxes on
Insurance Corporations) shall be allowed to a partnership, LLC,
subchapter S corp., or other business entity and shall be passed
through to the partners, members or share-holders respectively.
Credits allowed to these entities shall be allocated among all
partners without regard to their sharing of other tax or economic
attributes of the entity.

Section 5 gives the effective date of the act.

EXISTING LAW: State historic tax credits cannot be allocated
separately from the federal tax credit.

JUSTIFICATION: In 2006, New York State became the 28th state in the
nation to enact a tax incentive (Chapter 547 of the laws of 2006) to
encourage the rehabilitation of historic commercial and residential
properties. While the Legislature's establishment of this program was
welcomed, enhancements were required to assure the program matched the
notable economic stimulus impacts and community redevelopment
successes achieved by effective programs in other states. However,
there remains an inability for a partnership/LLC to allocate the state


tax credit separately from the federal tax credit. As out of state
investors are unable to realize the benefits of the state tax credit,
coupling the state and federal tax credits leaves little incentive for
out of state investors to participate in economic development
projects. By allowing members of a partnership/LLC to allocate these
tax credits as they see fit, additional out of state investors will be
attracted to invest in historic rehabilitation projects here in New
York.

LEGISLATIVE HISTORY: New bill

FISCAL IMPLICATIONS: No direct fiscal impact. Any increase in
projects undertaken because of the larger pool of potential investors
would be offset through new project development in aging historic
properties statewide and the associated job creation and spin off
sales tax and other revenues associated with these projects.

LOCAL FISCAL IMPLICATIONS: None

EFFECTIVE DATE: This act shall take effect immediately and shall
apply to taxable years beginning on and after January 1, 2014; this
act shall expire and be deemed repealed December 31, 2019; provided,
however, that the credit shall be applied to any rehabilitation
project commenced on or before December 31, 2019

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

                                  2221

                       2013-2014 Regular Sessions

                            I N  S E N A T E

                            January 14, 2013
                               ___________

Introduced  by Sen. GALLIVAN -- read twice and ordered printed, and when
  printed to be committed to the Committee on Investigations and Govern-
  ment Operations

AN ACT to amend the tax law, in relation to credits for certain rehabil-
  itation projects; and providing for the repeal of such provisions upon
  expiration thereof

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

  Section 1. Subsection (oo) of section 606 of the tax law is amended by
adding a new paragraph 6 to read as follows:
  (6)  TAX  CREDITS ALLOWED PURSUANT TO THIS SUBSECTION SHALL BE ALLOWED
TO A PARTNERSHIP, LIMITED LIABILITY COMPANY, "SUBCHAPTER S"  CORPORATION
OR  OTHER  BUSINESS  ENTITY AND SHALL BE PASSED THROUGH TO THE PARTNERS,
MEMBERS, OR SHAREHOLDERS RESPECTIVELY. CREDITS ALLOWED TO THESE ENTITIES
SHALL BE ALLOCATED AMONG ALL PARTNERS, MEMBERS, OR SHAREHOLDERS  RESPEC-
TIVELY,  EITHER IN PROPORTION TO THEIR OWNERSHIP INTEREST IN THE ENTITY,
OR AS THE PARTNERS, MEMBERS, OR SHAREHOLDERS MUTUALLY AGREE AS  PROVIDED
IN  AN EXECUTED DOCUMENT WITHOUT REGARD TO THEIR SHARING OF OTHER TAX OR
ECONOMIC ATTRIBUTES OF THE ENTITY.
  S 2. Subdivision 40 of section 210 of the tax law is amended by adding
a new paragraph 6 to read as follows:
  (6) TAX CREDITS ALLOWED PURSUANT TO THIS SUBDIVISION SHALL BE  ALLOWED
TO  A PARTNERSHIP, LIMITED LIABILITY COMPANY, "SUBCHAPTER S" CORPORATION
OR OTHER BUSINESS ENTITY AND SHALL BE PASSED THROUGH  TO  THE  PARTNERS,
MEMBERS, OR SHAREHOLDERS RESPECTIVELY. CREDITS ALLOWED TO THESE ENTITIES
SHALL  BE ALLOCATED AMONG ALL PARTNERS, MEMBERS, OR SHAREHOLDERS RESPEC-
TIVELY, EITHER IN PROPORTION TO THEIR OWNERSHIP INTEREST IN THE  ENTITY,
OR  AS THE PARTNERS, MEMBERS, OR SHAREHOLDERS MUTUALLY AGREE AS PROVIDED
IN AN EXECUTED DOCUMENT WITHOUT REGARD TO THEIR SHARING OF OTHER TAX  OR
ECONOMIC ATTRIBUTES OF THE ENTITY.

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD05761-01-3

S. 2221                             2

  S  3. Subsection (u) of section 1456 of the tax law, as added by chap-
ter 472 of the laws of 2010, is amended by adding a new paragraph  6  to
read as follows:
  (6)  TAX  CREDITS ALLOWED PURSUANT TO THIS SUBSECTION SHALL BE ALLOWED
TO A PARTNERSHIP, LIMITED LIABILITY COMPANY, "SUBCHAPTER S"  CORPORATION
OR  OTHER  BUSINESS  ENTITY  SHALL  BE  PASSED  THROUGH TO THE PARTNERS,
MEMBERS, OR SHAREHOLDERS RESPECTIVELY. CREDITS ALLOWED TO THESE ENTITIES
SHALL BE ALLOCATED AMONG ALL PARTNERS, MEMBERS, OR SHAREHOLDERS  RESPEC-
TIVELY,  EITHER IN PROPORTION TO THEIR OWNERSHIP INTEREST IN THE ENTITY,
OR AS THE PARTNERS, MEMBERS, OR SHAREHOLDERS MUTUALLY AGREE AS  PROVIDED
IN  AN EXECUTED DOCUMENT WITHOUT REGARD TO THEIR SHARING OF OTHER TAX OR
ECONOMIC ATTRIBUTES OF THE ENTITY.
  S 4. Subdivision (y) of section 1511 of the tax law, as added by chap-
ter 472 of the laws of 2010, is amended by adding a new paragraph  6  to
read as follows:
  (6)  TAX CREDITS ALLOWED PURSUANT TO THIS SUBDIVISION SHALL BE ALLOWED
TO A PARTNERSHIP, LIMITED LIABILITY COMPANY, "SUBCHAPTER S"  CORPORATION
OR  OTHER  BUSINESS  ENTITY AND SHALL BE PASSED THROUGH TO THE PARTNERS,
MEMBERS, OR SHAREHOLDERS RESPECTIVELY. CREDITS ALLOWED TO THESE ENTITIES
SHALL BE ALLOCATED AMONG ALL PARTNERS, MEMBERS, OR SHAREHOLDERS  RESPEC-
TIVELY,  EITHER IN PROPORTION TO THEIR OWNERSHIP INTEREST IN THE ENTITY,
OR AS THE PARTNERS, MEMBERS, OR SHAREHOLDERS MUTUALLY AGREE AS  PROVIDED
IN  AN EXECUTED DOCUMENT WITHOUT REGARD TO THEIR SHARING OF OTHER TAX OR
ECONOMIC ATTRIBUTES OF THE ENTITY.
  S 5. This act shall take effect immediately and shall apply to taxable
years beginning on and after January 1, 2014;  provided,  however,  this
act shall expire and be deemed repealed December 31, 2019; and provided,
further  however, that the credit shall be applied to any rehabilitation
project commenced on or before December 31, 2019.

S2221A (ACTIVE) - Bill Details

Current Committee:
Law Section:
Tax Law
Laws Affected:
Amd §§606, 210, 1456 & 1511, Tax L

S2221A (ACTIVE) - Bill Texts

view summary

Relates to tax credits for certain rehabilitation projects.

view sponsor memo
BILL NUMBER:S2221A

TITLE OF BILL: An act to amend the tax law, in relation to credits
for certain rehabilitation projects; and providing for the repeal of
such provisions upon expiration thereof

PURPOSE:

To strengthen the existing historic rehabilitation tax credit by
allowing for a partnership/LLC to allocate the state tax credit
separately from the federal tax credit.

SUMMARY OF PROVISIONS:

Section 1 states the tax credit in section 606 (Personal Income Tax)
shall be allowed to a partnership, LLC, subchapter S corp., or other
business entity and shall be passed through to the partners, members,
or shareholders respectively. Credits allowed to these entities shall
be allocated among all partners without regard to their sharing of
other tax or economic attributes of the entity.

Section 2 states the tax credit in section 210 (Franchise Tax on
Business Corporations) shall be allowed to a partnership, LLC,
subchapter S corp., or other business entity and shall be passed
through to the partners, members, or shareholders respectively.
Credits allowed to these entities shall be allocated among all
partners without regard to their sharing of other tax or economic
attributes of the entity.

Section 3 states the tax credit in section 1456 (Franchise Tax on
Banking Corporations) shall be allowed to a partnership, LLC,
subchapter S corp., or other business entity and shall be passed
through to the partners, members, or shareholders respectively.
Credits allowed to these entities shall be allocated among all
partners without regard to their sharing of other tax or economic
attributes of the entity.

Section 4 states the tax credit in section 1511(Franchise Taxes on
Insurance Corporations) shall be allowed to a partnership, LLC,
subchapter S corp., or other business entity and shall be passed
through to the partners, members, or shareholders respectively.
Credits allowed to these entities shall be allocated among all
partners without regard to their sharing of other tax or economic
attributes of the entity.

Section 5 gives the effective date of the act.

EXISTING LAW:

State historic tax credits cannot be allocated separately from the
federal tax credit.

JUSTIFICATION:

In 2006, New York State became the 28th state in the nation to enact a
tax incentive (Chapter 547 of the laws of 2006) to encourage the
rehabilitation of historic commercial and residential properties.


While the legislature's establishment of this program was welcomed,
enhancements were required to assure the program matched the notable
economic stimulus impacts and community redevelopment successes
achieved by effective programs in other states. However, there remains
an inability for a partnership/LLC to allocate the state tax credit
separately from the federal tax credit. As out-of-state investors are
unable to realize the benefits of the state tax credit, coupling the
state and federal tax credits leaves little incentive for out of state
investors to participate in economic development projects. By allowing
members of a partnership/LLC to allocate these tax credits as they see
fit, additional out-of-state investors will be attracted to invest in
historic rehabilitation projects here in New York.

LEGISLATIVE HISTORY:

New bill

FISCAL IMPLICATIONS:

No direct fiscal impact. Any increase in projects undertaken because
of the larger pool of potential investors would be offset through new
project development in aging historic properties statewide and the
associated job creation and spin off sales tax and other revenues
associated with these projects.

LOCAL FISCAL IMPLICATIONS:

None

EFFECTIVE DATE:

This act shall take effect immediately and shall apply to taxable
years beginning on and after January 1, 2015; this act shall expire
and be deemed repealed December 31, 2019; provided, however, that the
credit shall be applied to any rehabilitation project commenced on or
before December 31, 2019.

view full text
download pdf
                    S T A T E   O F   N E W   Y O R K
________________________________________________________________________

                                 2221--A

                       2013-2014 Regular Sessions

                            I N  S E N A T E

                            January 14, 2013
                               ___________

Introduced  by Sen. GALLIVAN -- read twice and ordered printed, and when
  printed to be committed to the Committee on Investigations and Govern-
  ment Operations -- recommitted to the Committee on Investigations  and
  Government  Operations  in  accordance  with  Senate Rule 6, sec. 8 --
  committee discharged, bill amended, ordered reprinted as  amended  and
  recommitted to said committee

AN ACT to amend the tax law, in relation to credits for certain rehabil-
  itation projects; and providing for the repeal of such provisions upon
  expiration thereof

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

  Section 1. Subsection (oo) of section 606 of the tax law is amended by
adding a new paragraph 6 to read as follows:
  (6) TAX CREDITS ALLOWED PURSUANT TO THIS SUBSECTION SHALL  BE  ALLOWED
TO  A PARTNERSHIP, LIMITED LIABILITY COMPANY, "SUBCHAPTER S" CORPORATION
OR OTHER BUSINESS ENTITY AND SHALL BE PASSED THROUGH  TO  THE  PARTNERS,
MEMBERS, OR SHAREHOLDERS RESPECTIVELY. CREDITS ALLOWED TO THESE ENTITIES
SHALL  BE ALLOCATED AMONG ALL PARTNERS, MEMBERS, OR SHAREHOLDERS RESPEC-
TIVELY, EITHER IN PROPORTION TO THEIR OWNERSHIP INTEREST IN THE  ENTITY,
OR  AS THE PARTNERS, MEMBERS, OR SHAREHOLDERS MUTUALLY AGREE AS PROVIDED
IN AN EXECUTED DOCUMENT WITHOUT REGARD TO THEIR SHARING OF OTHER TAX  OR
ECONOMIC ATTRIBUTES OF THE ENTITY.
  S 2. Subdivision 40 of section 210 of the tax law is amended by adding
a new paragraph 6 to read as follows:
  (6)  TAX CREDITS ALLOWED PURSUANT TO THIS SUBDIVISION SHALL BE ALLOWED
TO A PARTNERSHIP, LIMITED LIABILITY COMPANY, "SUBCHAPTER S"  CORPORATION
OR  OTHER  BUSINESS  ENTITY AND SHALL BE PASSED THROUGH TO THE PARTNERS,
MEMBERS, OR SHAREHOLDERS RESPECTIVELY. CREDITS ALLOWED TO THESE ENTITIES
SHALL BE ALLOCATED AMONG ALL PARTNERS, MEMBERS, OR SHAREHOLDERS  RESPEC-
TIVELY,  EITHER IN PROPORTION TO THEIR OWNERSHIP INTEREST IN THE ENTITY,
OR AS THE PARTNERS, MEMBERS, OR SHAREHOLDERS MUTUALLY AGREE AS  PROVIDED

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD05761-02-4

S. 2221--A                          2

IN  AN EXECUTED DOCUMENT WITHOUT REGARD TO THEIR SHARING OF OTHER TAX OR
ECONOMIC ATTRIBUTES OF THE ENTITY.
  S  3. Subsection (u) of section 1456 of the tax law, as added by chap-
ter 472 of the laws of 2010, is amended by adding a new paragraph  6  to
read as follows:
  (6)  TAX  CREDITS ALLOWED PURSUANT TO THIS SUBSECTION SHALL BE ALLOWED
TO A PARTNERSHIP, LIMITED LIABILITY COMPANY, "SUBCHAPTER S"  CORPORATION
OR  OTHER  BUSINESS  ENTITY  SHALL  BE  PASSED  THROUGH TO THE PARTNERS,
MEMBERS, OR SHAREHOLDERS RESPECTIVELY. CREDITS ALLOWED TO THESE ENTITIES
SHALL BE ALLOCATED AMONG ALL PARTNERS, MEMBERS, OR SHAREHOLDERS  RESPEC-
TIVELY,  EITHER IN PROPORTION TO THEIR OWNERSHIP INTEREST IN THE ENTITY,
OR AS THE PARTNERS, MEMBERS, OR SHAREHOLDERS MUTUALLY AGREE AS  PROVIDED
IN  AN EXECUTED DOCUMENT WITHOUT REGARD TO THEIR SHARING OF OTHER TAX OR
ECONOMIC ATTRIBUTES OF THE ENTITY.
  S 4. Subdivision (y) of section 1511 of the tax law, as added by chap-
ter 472 of the laws of 2010, is amended by adding a new paragraph  6  to
read as follows:
  (6)  TAX CREDITS ALLOWED PURSUANT TO THIS SUBDIVISION SHALL BE ALLOWED
TO A PARTNERSHIP, LIMITED LIABILITY COMPANY, "SUBCHAPTER S"  CORPORATION
OR  OTHER  BUSINESS  ENTITY AND SHALL BE PASSED THROUGH TO THE PARTNERS,
MEMBERS, OR SHAREHOLDERS RESPECTIVELY. CREDITS ALLOWED TO THESE ENTITIES
SHALL BE ALLOCATED AMONG ALL PARTNERS, MEMBERS, OR SHAREHOLDERS  RESPEC-
TIVELY,  EITHER IN PROPORTION TO THEIR OWNERSHIP INTEREST IN THE ENTITY,
OR AS THE PARTNERS, MEMBERS, OR SHAREHOLDERS MUTUALLY AGREE AS  PROVIDED
IN  AN EXECUTED DOCUMENT WITHOUT REGARD TO THEIR SHARING OF OTHER TAX OR
ECONOMIC ATTRIBUTES OF THE ENTITY.
  S 5. This act shall take effect immediately and shall apply to taxable
years beginning on and after January 1, 2015;  provided,  however,  this
act shall expire and be deemed repealed December 31, 2019; and provided,
further  however, that the credit shall be applied to any rehabilitation
project commenced on or before December 31, 2019.

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