senate Bill S3732C

2013-2014 Legislative Session

Establishes an angel tax credit for investors who invest in certified startup business enterprises

download bill text pdf

Sponsored By

Archive: Last Bill Status - Passed Senate


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

do you support this bill?

Actions

view actions (22)
Assembly Actions - Lowercase
Senate Actions - UPPERCASE
Jun 12, 2014 referred to ways and means
delivered to assembly
passed senate
Jun 09, 2014 amended on third reading (t) 3732c
Jun 02, 2014 advanced to third reading
May 29, 2014 2nd report cal.
May 28, 2014 1st report cal.943
May 14, 2014 reported and committed to finance
May 13, 2014 print number 3732b
May 13, 2014 amend and recommit to local government
Apr 30, 2014 print number 3732a
amend and recommit to local government
Jan 08, 2014 referred to local government
returned to senate
died in assembly
Jun 13, 2013 referred to ways and means
delivered to assembly
passed senate
Jun 12, 2013 ordered to third reading cal.1329
committee discharged and committed to rules
May 22, 2013 reported and committed to finance
Feb 13, 2013 referred to local government

Votes

view votes

May 28, 2014 - Finance committee Vote

S3732B
33
2
committee
33
Aye
2
Nay
2
Aye with Reservations
0
Absent
0
Excused
0
Abstained
show committee vote details

May 13, 2014 - Local Government committee Vote

S3732A
7
0
committee
7
Aye
0
Nay
2
Aye with Reservations
0
Absent
0
Excused
0
Abstained
show committee vote details

Committee Vote: May 13, 2014

aye wr (2)

Jun 17, 2013 - Rules committee Vote

S3732
23
0
committee
23
Aye
0
Nay
1
Aye with Reservations
0
Absent
1
Excused
0
Abstained
show committee vote details

Jun 12, 2013 - Rules committee Vote

S3732
23
0
committee
23
Aye
0
Nay
1
Aye with Reservations
0
Absent
1
Excused
0
Abstained
show committee vote details

May 22, 2013 - Local Government committee Vote

S3732
8
0
committee
8
Aye
0
Nay
1
Aye with Reservations
0
Absent
0
Excused
0
Abstained
show committee vote details

Committee Vote: May 22, 2013

aye wr (1)

Bill Amendments

Original
A
B
C (Active)
Original
A
B
C (Active)

Co-Sponsors

view additional co-sponsors

S3732 - Bill Details

Current Committee:
Law Section:
Economic Development Law
Laws Affected:
Add §441, Ec Dev L; amd §§210, 606, 1456 & 1511, Tax L
Versions Introduced in 2011-2012 Legislative Session:
S6837

S3732 - Bill Texts

view summary

Establishes an angel tax credit for investors who invest in certified startup business enterprises.

view sponsor memo
BILL NUMBER:S3732

TITLE OF BILL: An act to amend the general municipal law and the tax
law, in relation to establishing an angel tax credit for investments
made in small businesses

PURPOSE: To establish an angel tax credit for investors who invest in
certified startup business enterprises.

SUMMARY OF PROVISIONS: This bill creates a new angel tax credit that
provides incentives for investment in targeted industries and technolo-
gies which is available in other states. The bill authorizes the Commis-
sioner of Economic Development to certify Startup Business Enterprises
(SBE) and allocates $7 million in total Angel Tax Credits each year. The
minimum investment is $100,000 and is capped at $1 million in qualifying
contributions to capital ; and no single certified SBE will be eligible
for more than $1 million in qualifying contributions. The investor is
provided with a refundable credit equal to 35 percent of such investor's
qualifying investment (i.e. a $1 million capital investment would result
in a $350,000 credit) The credit is available to Article 9-A, Article
22, Article 32, and Article 33 taxpayers.

JUSTIFICATION: New York State small businesses are at a disadvantage to
those located in other states which offer tax credits like the Angel Tax
Credit due to the lack of both public and private investment dollars.
Other states have economic development programs, as well as angel tax
credits, that support both business development and business attraction
efforts. In New York this results in a continued lack of private invest-
ment in early stage companies often stunting their growth and causing
them to lag behind their competition.

In the past decade, more than 20 states have implemented programs to
both attract and or retain investment capital using tax credits, which
reduce the risk and cost of these ventures.

To become more competitive, New York State needs to create a tax envi-
ronment that promotes private investment within emerging business. This
bill will facilitate job growth and a more diverse statewide economy.

LEGISLATIVE HISTORY: S.6837/A.9939

FISCAL IMPLICATIONS: Assuming the Commissioner of Economic Development
allocates $7 million of Angel Tax Credits each year of the three year
period and each such Certified SBE raises the maximum $1,000,000 in
capital contributions based upon the credits, the total annual cost to
the State of New York credits would be $7 million with a total cost over
three years of $21 million.

EFFECTIVE DATE: Immediately.

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

                                  3732

                       2013-2014 Regular Sessions

                            I N  S E N A T E

                            February 13, 2013
                               ___________

Introduced by Sens. DeFRANCISCO, GALLIVAN, MAZIARZ, SEWARD -- read twice
  and ordered printed, and when printed to be committed to the Committee
  on Local Government

AN  ACT  to amend the general municipal law and the tax law, in relation
  to establishing an angel tax credit  for  investments  made  in  small
  businesses

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

  Section 1. The general municipal  law  is  amended  by  adding  a  new
section 959-c to read as follows:
  S 959-C. CERTIFIED STARTUP BUSINESS ENTERPRISE. (A) CERTIFICATION. (I)
THE COMMISSIONER SHALL APPROVE APPLICATIONS FOR QUALIFICATION OF A BUSI-
NESS  ENTERPRISE AS A CERTIFIED STARTUP BUSINESS ENTERPRISE. AS A CONDI-
TION FOR APPROVAL OF SUCH APPLICATION, THE COMMISSIONER IS AUTHORIZED TO
SPECIFY CERTAIN REQUIREMENTS TO BE SATISFIED AS A CONDITION FOR APPROVAL
OF A BUSINESS ENTERPRISE AS A CERTIFIED STARTUP BUSINESS  ENTERPRISE  AS
THE  COMMISSIONER DEEMS NECESSARY TO ENSURE THE QUALIFYING ANGEL INVEST-
MENT WILL MAKE A SUBSTANTIAL CONTRIBUTION TO THE ECONOMIC DEVELOPMENT OF
THIS STATE, INCLUDING THE USE OF  A  SYSTEM  OF  EVALUATION  OF  VARIOUS
APPLICANT BUSINESS ENTERPRISES IN A COMPETITIVE FASHION.
  (II)  WITH  RESPECT  TO AN APPROVED APPLICATION FOR QUALIFICATION OF A
BUSINESS ENTERPRISE AS A  CERTIFIED  STARTUP  BUSINESS  ENTERPRISE,  THE
COMMISSIONER  SHALL  ISSUE  TO SUCH BUSINESS ENTERPRISE A CERTIFICATE OF
QUALIFICATION AS A CERTIFIED STARTUP BUSINESS ENTERPRISE  SETTING  FORTH
THE  EFFECTIVE  DATE  OF  THE CERTIFICATION AND THE AMOUNT OF QUALIFYING
ANGEL INVESTMENT AWARDED TO SUCH BUSINESS ENTERPRISE, WHICH AMOUNT SHALL
BE NO LESS THAN ONE HUNDRED  THOUSAND  DOLLARS  AND  NO  MORE  THAN  ONE
MILLION DOLLARS.
  (III)  FOR  THE  PERIOD JULY FIRST, TWO THOUSAND THIRTEEN THROUGH JUNE
THIRTIETH, TWO THOUSAND FOURTEEN, THE COMMISSIONER  MAY  CERTIFY  UP  TO
SEVEN  MILLION  DOLLARS  IN  QUALIFYING ANGEL INVESTMENT. FOR THE PERIOD

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD07810-01-3

S. 3732                             2

JULY FIRST, TWO THOUSAND FOURTEEN THROUGH JUNE THIRTIETH,  TWO  THOUSAND
FIFTEEN,  THE  COMMISSIONER  MAY  CERTIFY UP TO SEVEN MILLION DOLLARS IN
QUALIFYING ANGEL INVESTMENT. FOR THE PERIOD  JULY  FIRST,  TWO  THOUSAND
FIFTEEN  THROUGH  JUNE THIRTIETH, TWO THOUSAND SIXTEEN, THE COMMISSIONER
MAY CERTIFY UP TO SEVEN MILLION DOLLARS IN QUALIFYING ANGEL INVESTMENT.
  (B) DEFINITIONS. AS USED IN THIS SECTION, THE  FOLLOWING  TERMS  SHALL
HAVE THE FOLLOWING MEANINGS:
  (I)  "CERTIFIED  STARTUP  BUSINESS  ENTERPRISE"  SHALL MEAN A BUSINESS
ENTERPRISE LOCATED IN NEW YORK STATE:
  (1) WITH LESS THAN FIVE MILLION DOLLARS IN ANNUAL REVENUES;
  (2) WHOSE PRIMARY ACTIVITY CONSISTS  OF  A  QUALIFYING  TECHNOLOGY  OR
INNOVATION ACTIVITY; AND
  (3) THAT HAS BEEN CERTIFIED AS A CERTIFIED STARTUP BUSINESS ENTERPRISE
BY THE COMMISSIONER.
  (II) "QUALIFYING TECHNOLOGY OR INNOVATION ACTIVITY" SHALL MEAN:
  (1)  BIOTECHNOLOGIES, WHICH SHALL BE DEFINED AS TECHNOLOGIES INVOLVING
THE SCIENTIFIC MANIPULATION  OF  LIVING  ORGANISMS,  ESPECIALLY  AT  THE
MOLECULAR  AND/OR  THE  SUB-MOLECULAR GENETIC LEVEL, TO PRODUCE PRODUCTS
CONDUCIVE TO IMPROVING THE LIVES AND  HEALTH  OF  PLANTS,  ANIMALS,  AND
HUMANS; AND THE ASSOCIATED SCIENTIFIC RESEARCH, PHARMACOLOGICAL, MECHAN-
ICAL,  AND  COMPUTATIONAL APPLICATIONS AND SERVICES CONNECTED WITH THESE
IMPROVEMENTS;
  (2) INFORMATION AND COMMUNICATION TECHNOLOGIES, EQUIPMENT AND  SYSTEMS
THAT  INVOLVE  ADVANCED  COMPUTER  SOFTWARE  AND HARDWARE, VISUALIZATION
TECHNOLOGIES, AND HUMAN INTERFACE TECHNOLOGIES;
  (3) ADVANCED MATERIALS AND PROCESSING TECHNOLOGIES  THAT  INVOLVE  THE
DEVELOPMENT,  MODIFICATION,  OR  IMPROVEMENT OF ONE OR MORE MATERIALS OR
METHODS TO PRODUCE DEVICES  AND  STRUCTURES  WITH  IMPROVED  PERFORMANCE
CHARACTERISTICS  OR SPECIAL FUNCTIONAL ATTRIBUTES, OR TO ACTIVATE, SPEED
UP, OR OTHERWISE ALTER CHEMICAL, BIOCHEMICAL, OR MEDICAL PROCESSES;
  (4) ELECTRONIC AND PHOTONIC DEVICES AND COMPONENTS FOR USE IN  PRODUC-
ING  ELECTRONIC,  OPTOELECTRONIC,  MECHANICAL  EQUIPMENT AND PRODUCTS OF
ELECTRONIC DISTRIBUTION WITH INTERACTIVE MEDIA CONTENT;
  (5) ENERGY EFFICIENCY, RENEWABLE ENERGY  AND  ENVIRONMENTAL  TECHNOLO-
GIES, PRODUCTS, DEVICES AND SERVICES; OR
  (6) SMALL SCALE SYSTEMS INTEGRATION AND PACKAGING.
  (III)  "QUALIFYING  ANGEL INVESTMENT" SHALL MEAN A CONTRIBUTION TO THE
CAPITAL OF A CERTIFIED STARTUP BUSINESS ENTERPRISE, PROVIDED  THAT  SUCH
CONTRIBUTION TO CAPITAL IS MADE WITHIN TWELVE MONTHS AFTER THE EFFECTIVE
DATE  OF THE CERTIFIED TECHNOLOGY VENTURE'S CERTIFICATE OF QUALIFICATION
AS A CERTIFIED TECHNOLOGY VENTURE AND SUCH CONTRIBUTION  IS  APPLIED  BY
THE  CERTIFIED  STARTUP  BUSINESS  ENTERPRISE  AGAINST ITS ALLOCATION OF
QUALIFYING ANGEL INVESTMENT. TOGETHER WITH ALL  OTHER  QUALIFYING  ANGEL
INVESTMENTS  MADE TO A SINGLE CERTIFIED STARTUP BUSINESS ENTERPRISE, THE
TOTAL QUALIFYING ANGEL INVESTMENT MAY NOT EXCEED  ONE  MILLION  DOLLARS.
NOTHING HEREIN SHALL PROHIBIT A PERSON MAKING A QUALIFYING ANGEL INVEST-
MENT  FROM  MAKING ADDITIONAL CONTRIBUTIONS TO THE CAPITAL OF THE CERTI-
FIED STARTUP BUSINESS ENTERPRISE OR MAKING LOANS TO OR OTHER INVESTMENTS
IN THE CERTIFIED STARTUP BUSINESS ENTERPRISE,  PROVIDED,  HOWEVER,  THAT
SUCH  OTHER CONTRIBUTIONS, LOANS AND INVESTMENTS SHALL NOT BE TREATED AS
QUALIFYING ANGEL INVESTMENTS.
  S 2. Section 210 of the tax law is amended by adding a new subdivision
12-H to read as follows:
  12-H. ANGEL TAX CREDIT.  (A) ALLOWANCE OF CREDIT. A TAXPAYER THAT  HAS
MADE A QUALIFYING ANGEL INVESTMENT, AS SUCH TERM IS DEFINED IN PARAGRAPH
(III)  OF  SUBDIVISION  (B)  OF SECTION NINE HUNDRED FIFTY-NINE-C OF THE

S. 3732                             3

GENERAL MUNICIPAL LAW, SHALL BE ALLOWED A CREDIT  EQUAL  TO  THIRTY-FIVE
PERCENT OF THE AMOUNT OF SUCH QUALIFYING ANGEL INVESTMENT.
  (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 HIGHER OF THE AMOUNTS PRESCRIBED IN PARAGRAPHS (C) AND  (D)  OF
SUBDIVISION  ONE  OF  THIS  SECTION.  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 TEN HUNDRED EIGHT-
Y-SIX  OF  THIS CHAPTER. PROVIDED, HOWEVER, THE PROVISIONS OF SUBSECTION
(C) OF SECTION TEN HUNDRED EIGHTY-EIGHT OF THIS CHAPTER NOTWITHSTANDING,
NO INTEREST SHALL BE PAID THEREON.
  S 3. Section 606 of the tax law is amended by adding a new subdivision
(vv) to read as follows:
  (VV) ANGEL TAX CREDIT. (1) ALLOWANCE OF CREDIT. A  TAXPAYER  THAT  HAS
MADE A QUALIFYING ANGEL INVESTMENT, AS SUCH TERM IS DEFINED IN PARAGRAPH
(III)  OF  SUBDIVISION  (B)  OF SECTION NINE HUNDRED FIFTY-NINE-C OF THE
GENERAL MUNICIPAL LAW, OR THAT IS A MEMBER OF  A  PARTNERSHIP  THAT  HAS
MADE  A  QUALIFYING ANGEL INVESTMENT, SHALL BE ALLOWED A CREDIT EQUAL TO
THIRTY-FIVE PERCENT OF THE AMOUNT OF SUCH  QUALIFYING  ANGEL  INVESTMENT
OR,  IN THE CASE OF A TAXPAYER WHO IS A MEMBER OF A PARTNERSHIP THAT HAS
MADE A QUALIFYING ANGEL INVESTMENT, A PORTION OF SUCH  QUALIFYING  ANGEL
INVESTMENT  EQUAL  TO  THE  PORTION  OF  ITEMS OF INCOME, GAIN, LOSS AND
DEDUCTION ASSOCIATED WITH THE QUALIFYING ANGEL INVESTMENT PROPERLY ALLO-
CABLE TO SUCH TAXPAYER UNDER SECTION 704 OF THE  INTERNAL  REVENUE  CODE
FOR THE TAXABLE YEAR.
  (2)  APPLICATION  OF CREDIT. IF THE AMOUNT OF THE CREDIT ALLOWED UNDER
THIS SUBSECTION FOR ANY TAXABLE YEAR SHALL EXCEED THE TAXPAYER'S TAX FOR
SUCH YEAR, 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.
  S  4.  Section 1456 of the tax law is amended by adding a new subdivi-
sion (z) to read as follows:
  (Z) ANGEL TAX CREDIT. (1) ALLOWANCE OF CREDIT.  A  TAXPAYER  THAT  HAS
MADE A QUALIFYING ANGEL INVESTMENT, AS SUCH TERM IS DEFINED IN PARAGRAPH
(III)  OF  SUBDIVISION  (B)  OF SECTION NINE HUNDRED FIFTY-NINE-C OF THE
GENERAL MUNICIPAL LAW, SHALL BE ALLOWED A CREDIT  EQUAL  TO  THIRTY-FIVE
PERCENT OF THE AMOUNT OF SUCH QUALIFYING ANGEL INVESTMENT.
  (2)  APPLICATION  OF  CREDIT. THE CREDIT ALLOWED UNDER THIS SUBSECTION
FOR ANY TAXABLE YEAR SHALL NOT REDUCE THE TAX DUE FOR SUCH YEAR TO  LESS
THAN THE MINIMUM TAX FIXED BY SUBSECTION (B) OF SECTION FOURTEEN HUNDRED
FIFTY-FIVE  OF  THIS  ARTICLE.  HOWEVER, IF THE AMOUNT OF CREDIT ALLOWED
UNDER THIS SUBSECTION FOR ANY TAXABLE  YEAR  REDUCES  THE  TAX  TO  SUCH
AMOUNT,  THEN  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 TEN HUNDRED EIGHT-
Y-SIX  OF  THIS CHAPTER. PROVIDED, HOWEVER, THE PROVISIONS OF SUBSECTION
(C) OF SECTION TEN HUNDRED EIGHTY-EIGHT OF THIS CHAPTER NOTWITHSTANDING,
NO INTEREST SHALL BE PAID THEREON.
  S 5. Section 1511 of the tax law is amended by adding a  new  subdivi-
sion (cc) to read as follows:
  (CC)  ANGEL  TAX  CREDIT. (1) ALLOWANCE OF CREDIT. A TAXPAYER THAT HAS
MADE A QUALIFYING ANGEL INVESTMENT, AS SUCH TERM IS DEFINED IN PARAGRAPH
(III) OF SUBDIVISION (B) OF SECTION NINE  HUNDRED  FIFTY-NINE-C  OF  THE

S. 3732                             4

GENERAL  MUNICIPAL  LAW,  SHALL BE ALLOWED A CREDIT EQUAL TO THIRTY-FIVE
PERCENT OF THE AMOUNT OF SUCH QUALIFYING ANGEL INVESTMENT.
  (2)  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  MINIMUM  TAX  FIXED  BY  PARAGRAPH FOUR OF SUBDIVISION (A) OF
SECTION FIFTEEN HUNDRED TWO  OF  THIS  ARTICLE  OR  BY  SECTION  FIFTEEN
HUNDRED  TWO-A OF THIS ARTICLE, WHICHEVER IS APPLICABLE. HOWEVER, IF THE
AMOUNT OF CREDIT ALLOWED UNDER THIS SUBDIVISION  FOR  ANY  TAXABLE  YEAR
REDUCES  THE  TAX  TO  SUCH  AMOUNT,  THEN 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 TEN HUNDRED EIGHTY-SIX OF THIS CHAPTER. PROVIDED,  HOWEVER,  THE
PROVISIONS OF SUBSECTION (C) OF SECTION TEN HUNDRED EIGHTY-EIGHT OF THIS
CHAPTER NOTWITHSTANDING, NO INTEREST SHALL BE PAID THEREON.
  S 6. This act shall take effect immediately.

Co-Sponsors

view additional co-sponsors

S3732A - Bill Details

Current Committee:
Law Section:
Economic Development Law
Laws Affected:
Add §441, Ec Dev L; amd §§210, 606, 1456 & 1511, Tax L
Versions Introduced in 2011-2012 Legislative Session:
S6837

S3732A - Bill Texts

view summary

Establishes an angel tax credit for investors who invest in certified startup business enterprises.

view sponsor memo
BILL NUMBER:S3732A

TITLE OF BILL: An act to amend the general municipal law and the tax
law, in relation to establishing an angel tax credit for investments
made in small businesses

PURPOSE OR GENERAL IDEA OF BILL:

To establish an angel tax credit for investors who invest in certified
startup business enterprises.

SUMMARY OF SPECIFIC PROVISIONS:

This bill creates a new angel tax credit that provides incentives for
investment in targeted industries and technologies which is available
in other states. The bill authorizes the Commissioner of Economic
Development to certify Startup Business Enterprises(SBE) and allocates
$7 million in total Angel Tax Credits each year. The minimum
investment is $100,000 and is capped at $1 million in qualifying
contributions to capital; and no single certified SBE will be eligible
for more than $1 million in qualifying contributions. The investor is
provided with a refundable credit equal to 35 percent of such
investor's qualifying investment (i.e. a $1 million capital investment
would result in a $350,000 credit) The credit is available to Article
9-A, Article 22, Article 32, and Article 33 taxpayers.

JUSTIFICATION:

New York State small businesses are at a disadvantage to those located
in other states which offer tax credits like the Angel Tax Credit due
to the lack of both public and private investment dollars. Other
states have economic development programs, as well as angel tax
credits, that support both business development and business
attraction efforts. In New York this results in a continued lack of
private investment in early stage companies often stunting their
growth and causing them to lag behind their competition.

In the past decade, more than 20 states have implemented programs to
both attract and or retain investment capital using tax credits, which
reduce the risk and cost of these ventures.

To become more competitive, New York State needs to create a tax
environment that promotes private investment within emerging business.
This bill will facilitate job growth and a more diverse statewide
economy.

PRIOR LEGISLATIVE HISTORY:

S.6837/A.9939

FISCAL IMPLICATIONS:

Assuming the Commissioner of Economic Development allocates $7 million
of Angel Tax Credits each year of the three year period and each such
Certified SBE raises the maximum $1,000,000 in capital contributions
based upon the credits, the total annual cost to the State of New York


credits would be $7 million with a total cost over three years of $21
million.

EFFECTIVE DATE:

Immediately.

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

                                 3732--A

                       2013-2014 Regular Sessions

                            I N  S E N A T E

                            February 13, 2013
                               ___________

Introduced  by  Sens.  DeFRANCISCO,  FELDER, GALLIVAN, MAZIARZ, O'BRIEN,
  SEWARD, VALESKY -- read twice and ordered printed, and when printed to
  be committed to the Committee on Local Government  --  recommitted  to
  the  Committee  on  Local Government 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 general municipal law and the tax law, in relation
  to establishing an angel tax credit  for  investments  made  in  small
  businesses

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

  Section 1. The general municipal  law  is  amended  by  adding  a  new
section 959-c to read as follows:
  S 959-C. CERTIFIED STARTUP BUSINESS ENTERPRISE. (A) CERTIFICATION. (I)
THE COMMISSIONER SHALL APPROVE APPLICATIONS FOR QUALIFICATION OF A BUSI-
NESS  ENTERPRISE AS A CERTIFIED STARTUP BUSINESS ENTERPRISE. AS A CONDI-
TION FOR APPROVAL OF SUCH APPLICATION, THE COMMISSIONER IS AUTHORIZED TO
SPECIFY CERTAIN REQUIREMENTS TO BE SATISFIED AS A CONDITION FOR APPROVAL
OF A BUSINESS ENTERPRISE AS A CERTIFIED STARTUP BUSINESS  ENTERPRISE  AS
THE  COMMISSIONER DEEMS NECESSARY TO ENSURE THE QUALIFYING ANGEL INVEST-
MENT WILL MAKE A SUBSTANTIAL CONTRIBUTION TO THE ECONOMIC DEVELOPMENT OF
THIS STATE, INCLUDING THE USE OF  A  SYSTEM  OF  EVALUATION  OF  VARIOUS
APPLICANT BUSINESS ENTERPRISES IN A COMPETITIVE FASHION.
  (II)  WITH  RESPECT  TO AN APPROVED APPLICATION FOR QUALIFICATION OF A
BUSINESS ENTERPRISE AS A  CERTIFIED  STARTUP  BUSINESS  ENTERPRISE,  THE
COMMISSIONER  SHALL  ISSUE  TO SUCH BUSINESS ENTERPRISE A CERTIFICATE OF
QUALIFICATION AS A CERTIFIED STARTUP BUSINESS ENTERPRISE  SETTING  FORTH
THE  EFFECTIVE  DATE  OF  THE CERTIFICATION AND THE AMOUNT OF QUALIFYING
ANGEL INVESTMENT AWARDED TO SUCH BUSINESS ENTERPRISE, WHICH AMOUNT SHALL
BE NO LESS THAN ONE HUNDRED  THOUSAND  DOLLARS  AND  NO  MORE  THAN  ONE
MILLION DOLLARS.

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD07810-07-4

S. 3732--A                          2

  (III)  FOR  THE  PERIOD  JULY FIRST, TWO THOUSAND FIFTEEN THROUGH JUNE
THIRTIETH, TWO THOUSAND SIXTEEN, THE  COMMISSIONER  MAY  CERTIFY  UP  TO
SEVEN  MILLION  DOLLARS  IN  QUALIFYING ANGEL INVESTMENT. FOR THE PERIOD
JULY FIRST, TWO THOUSAND SIXTEEN THROUGH JUNE  THIRTIETH,  TWO  THOUSAND
SEVENTEEN,  THE  COMMISSIONER MAY CERTIFY UP TO SEVEN MILLION DOLLARS IN
QUALIFYING ANGEL INVESTMENT. FOR THE PERIOD  JULY  FIRST,  TWO  THOUSAND
SEVENTEEN THROUGH JUNE THIRTIETH, TWO THOUSAND EIGHTEEN, THE COMMISSION-
ER  MAY  CERTIFY UP TO SEVEN MILLION DOLLARS IN QUALIFYING ANGEL INVEST-
MENT.
  (B) DEFINITIONS. AS USED IN THIS SECTION, THE  FOLLOWING  TERMS  SHALL
HAVE THE FOLLOWING MEANINGS:
  (I)  "CERTIFIED  STARTUP  BUSINESS  ENTERPRISE"  SHALL MEAN A BUSINESS
ENTERPRISE LOCATED IN NEW YORK STATE:
  (1) WITH LESS THAN FIVE MILLION DOLLARS IN ANNUAL REVENUES;
  (2) WHOSE PRIMARY ACTIVITY CONSISTS  OF  A  QUALIFYING  TECHNOLOGY  OR
INNOVATION ACTIVITY; AND
  (3) THAT HAS BEEN CERTIFIED AS A CERTIFIED STARTUP BUSINESS ENTERPRISE
BY THE COMMISSIONER.
  (II) "QUALIFYING TECHNOLOGY OR INNOVATION ACTIVITY" SHALL MEAN:
  (1)  BIOTECHNOLOGIES, WHICH SHALL BE DEFINED AS TECHNOLOGIES INVOLVING
THE SCIENTIFIC MANIPULATION  OF  LIVING  ORGANISMS,  ESPECIALLY  AT  THE
MOLECULAR  AND/OR  THE  SUB-MOLECULAR GENETIC LEVEL, TO PRODUCE PRODUCTS
CONDUCIVE TO IMPROVING THE LIVES AND  HEALTH  OF  PLANTS,  ANIMALS,  AND
HUMANS; AND THE ASSOCIATED SCIENTIFIC RESEARCH, PHARMACOLOGICAL, MECHAN-
ICAL,  AND  COMPUTATIONAL APPLICATIONS AND SERVICES CONNECTED WITH THESE
IMPROVEMENTS;
  (2) INFORMATION AND COMMUNICATION TECHNOLOGIES, EQUIPMENT AND  SYSTEMS
THAT  INVOLVE  ADVANCED  COMPUTER  SOFTWARE  AND HARDWARE, VISUALIZATION
TECHNOLOGIES, AND HUMAN INTERFACE TECHNOLOGIES;
  (3) ADVANCED MATERIALS AND PROCESSING TECHNOLOGIES  THAT  INVOLVE  THE
DEVELOPMENT,  MODIFICATION,  OR  IMPROVEMENT OF ONE OR MORE MATERIALS OR
METHODS TO PRODUCE DEVICES  AND  STRUCTURES  WITH  IMPROVED  PERFORMANCE
CHARACTERISTICS  OR SPECIAL FUNCTIONAL ATTRIBUTES, OR TO ACTIVATE, SPEED
UP, OR OTHERWISE ALTER CHEMICAL, BIOCHEMICAL, OR MEDICAL PROCESSES;
  (4) ELECTRONIC AND PHOTONIC DEVICES AND COMPONENTS FOR USE IN  PRODUC-
ING  ELECTRONIC,  OPTOELECTRONIC,  MECHANICAL  EQUIPMENT AND PRODUCTS OF
ELECTRONIC DISTRIBUTION WITH INTERACTIVE MEDIA CONTENT;
  (5) ENERGY EFFICIENCY, RENEWABLE ENERGY  AND  ENVIRONMENTAL  TECHNOLO-
GIES, PRODUCTS, DEVICES AND SERVICES; OR
  (6) SMALL SCALE SYSTEMS INTEGRATION AND PACKAGING.
  (III)  "QUALIFYING  ANGEL INVESTMENT" SHALL MEAN A CONTRIBUTION TO THE
CAPITAL OF A CERTIFIED STARTUP BUSINESS ENTERPRISE, PROVIDED  THAT  SUCH
CONTRIBUTION TO CAPITAL IS MADE WITHIN TWELVE MONTHS AFTER THE EFFECTIVE
DATE  OF THE CERTIFIED TECHNOLOGY VENTURE'S CERTIFICATE OF QUALIFICATION
AS A CERTIFIED TECHNOLOGY VENTURE AND SUCH CONTRIBUTION  IS  APPLIED  BY
THE  CERTIFIED  STARTUP  BUSINESS  ENTERPRISE  AGAINST ITS ALLOCATION OF
QUALIFYING ANGEL INVESTMENT. TOGETHER WITH ALL  OTHER  QUALIFYING  ANGEL
INVESTMENTS  MADE TO A SINGLE CERTIFIED STARTUP BUSINESS ENTERPRISE, THE
TOTAL QUALIFYING ANGEL INVESTMENT MAY NOT EXCEED  ONE  MILLION  DOLLARS.
NOTHING HEREIN SHALL PROHIBIT A PERSON MAKING A QUALIFYING ANGEL INVEST-
MENT  FROM  MAKING ADDITIONAL CONTRIBUTIONS TO THE CAPITAL OF THE CERTI-
FIED STARTUP BUSINESS ENTERPRISE OR MAKING LOANS TO OR OTHER INVESTMENTS
IN THE CERTIFIED STARTUP BUSINESS ENTERPRISE,  PROVIDED,  HOWEVER,  THAT
SUCH  OTHER CONTRIBUTIONS, LOANS AND INVESTMENTS SHALL NOT BE TREATED AS
QUALIFYING ANGEL INVESTMENTS.

S. 3732--A                          3

  S 2. Section 210 of the tax law is amended by adding a new subdivision
12-H to read as follows:
  12-H.  ANGEL TAX CREDIT.  (A) ALLOWANCE OF CREDIT. A TAXPAYER THAT HAS
MADE A QUALIFYING ANGEL INVESTMENT, AS SUCH TERM IS DEFINED IN PARAGRAPH
(III) OF SUBDIVISION (B) OF SECTION NINE  HUNDRED  FIFTY-NINE-C  OF  THE
GENERAL  MUNICIPAL  LAW,  SHALL BE ALLOWED A CREDIT EQUAL TO THIRTY-FIVE
PERCENT OF THE AMOUNT OF SUCH QUALIFYING ANGEL INVESTMENT.
  (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  HIGHER OF THE AMOUNTS PRESCRIBED IN PARAGRAPHS (C) AND (D) OF
SUBDIVISION ONE OF THIS  SECTION.  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 TEN HUNDRED EIGHT-
Y-SIX OF THIS CHAPTER. PROVIDED, HOWEVER, THE PROVISIONS  OF  SUBSECTION
(C) OF SECTION TEN HUNDRED EIGHTY-EIGHT OF THIS CHAPTER NOTWITHSTANDING,
NO INTEREST SHALL BE PAID THEREON.
  S  3. Section 606 of the tax law is amended by adding a new subsection
(ccc) to read as follows:
  (CCC) ANGEL TAX CREDIT. (1) ALLOWANCE OF CREDIT. A TAXPAYER  THAT  HAS
MADE A QUALIFYING ANGEL INVESTMENT, AS SUCH TERM IS DEFINED IN PARAGRAPH
(III)  OF  SUBDIVISION  (B)  OF SECTION NINE HUNDRED FIFTY-NINE-C OF THE
GENERAL MUNICIPAL LAW, OR THAT IS A MEMBER OF  A  PARTNERSHIP  THAT  HAS
MADE  A  QUALIFYING ANGEL INVESTMENT, SHALL BE ALLOWED A CREDIT EQUAL TO
THIRTY-FIVE PERCENT OF THE AMOUNT OF SUCH  QUALIFYING  ANGEL  INVESTMENT
OR,  IN THE CASE OF A TAXPAYER WHO IS A MEMBER OF A PARTNERSHIP THAT HAS
MADE A QUALIFYING ANGEL INVESTMENT, A PORTION OF SUCH  QUALIFYING  ANGEL
INVESTMENT  EQUAL  TO  THE  PORTION  OF  ITEMS OF INCOME, GAIN, LOSS AND
DEDUCTION ASSOCIATED WITH THE QUALIFYING ANGEL INVESTMENT PROPERLY ALLO-
CABLE TO SUCH TAXPAYER UNDER SECTION 704 OF THE  INTERNAL  REVENUE  CODE
FOR THE TAXABLE YEAR.
  (2)  APPLICATION  OF CREDIT. IF THE AMOUNT OF THE CREDIT ALLOWED UNDER
THIS SUBSECTION FOR ANY TAXABLE YEAR SHALL EXCEED THE TAXPAYER'S TAX FOR
SUCH YEAR, 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.
  S 4. Section 1456 of the tax law is amended by adding a new subsection
(aa) to read as follows:
  (AA)  ANGEL  TAX  CREDIT. (1) ALLOWANCE OF CREDIT. A TAXPAYER THAT HAS
MADE A QUALIFYING ANGEL INVESTMENT, AS SUCH TERM IS DEFINED IN PARAGRAPH
(III) OF SUBDIVISION (B) OF SECTION NINE  HUNDRED  FIFTY-NINE-C  OF  THE
GENERAL  MUNICIPAL  LAW,  SHALL BE ALLOWED A CREDIT EQUAL TO THIRTY-FIVE
PERCENT OF THE AMOUNT OF SUCH QUALIFYING ANGEL INVESTMENT.
  (2) APPLICATION OF CREDIT. THE CREDIT ALLOWED  UNDER  THIS  SUBSECTION
FOR  ANY TAXABLE YEAR SHALL NOT REDUCE THE TAX DUE FOR SUCH YEAR TO LESS
THAN THE MINIMUM TAX FIXED BY SUBSECTION (B) OF SECTION FOURTEEN HUNDRED
FIFTY-FIVE OF THIS ARTICLE. HOWEVER, IF THE  AMOUNT  OF  CREDIT  ALLOWED
UNDER  THIS  SUBSECTION  FOR  ANY  TAXABLE  YEAR REDUCES THE TAX TO SUCH
AMOUNT, THEN 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 TEN HUNDRED EIGHT-
Y-SIX OF THIS CHAPTER. PROVIDED, HOWEVER, THE PROVISIONS  OF  SUBSECTION
(C) OF SECTION TEN HUNDRED EIGHTY-EIGHT OF THIS CHAPTER NOTWITHSTANDING,
NO INTEREST SHALL BE PAID THEREON.

S. 3732--A                          4

  S  5.  Section 1511 of the tax law is amended by adding a new subdivi-
sion (dd) to read as follows:
  (DD)  ANGEL  TAX  CREDIT. (1) ALLOWANCE OF CREDIT. A TAXPAYER THAT HAS
MADE A QUALIFYING ANGEL INVESTMENT, AS SUCH TERM IS DEFINED IN PARAGRAPH
(III) OF SUBDIVISION (B) OF SECTION NINE  HUNDRED  FIFTY-NINE-C  OF  THE
GENERAL  MUNICIPAL  LAW,  SHALL BE ALLOWED A CREDIT EQUAL TO THIRTY-FIVE
PERCENT OF THE AMOUNT OF SUCH QUALIFYING ANGEL INVESTMENT.
  (2) 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 MINIMUM TAX FIXED BY  PARAGRAPH  FOUR  OF  SUBDIVISION  (A)  OF
SECTION  FIFTEEN  HUNDRED  TWO  OF  THIS  ARTICLE  OR BY SECTION FIFTEEN
HUNDRED TWO-A OF THIS ARTICLE, WHICHEVER IS APPLICABLE. HOWEVER, IF  THE
AMOUNT  OF  CREDIT  ALLOWED  UNDER THIS SUBDIVISION FOR ANY TAXABLE YEAR
REDUCES THE TAX TO SUCH AMOUNT, THEN  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  TEN  HUNDRED EIGHTY-SIX OF THIS CHAPTER. PROVIDED, HOWEVER, THE
PROVISIONS OF SUBSECTION (C) OF SECTION TEN HUNDRED EIGHTY-EIGHT OF THIS
CHAPTER NOTWITHSTANDING, NO INTEREST SHALL BE PAID THEREON.
  S 6. This act shall take effect immediately; provided that the  amend-
ments  to  section  1456 of the tax law made by section four of this act
shall not affect the repeal of such section and shall be deemed repealed
therewith.

Co-Sponsors

view additional co-sponsors

S3732B - Bill Details

Current Committee:
Law Section:
Economic Development Law
Laws Affected:
Add §441, Ec Dev L; amd §§210, 606, 1456 & 1511, Tax L
Versions Introduced in 2011-2012 Legislative Session:
S6837

S3732B - Bill Texts

view summary

Establishes an angel tax credit for investors who invest in certified startup business enterprises.

view sponsor memo
BILL NUMBER:S3732B

TITLE OF BILL: An act to amend the general municipal law and the tax
law, in relation to establishing an angel tax credit for investments
made in small businesses

PURPOSE OR GENERAL IDEA OF BILL: To establish an angel tax credit for
investors who invest in certified startup business enterprises.

SUMMARY OF SPECIFIC PROVISIONS: This bill creates a new angel tax
credit that provides incentives for investment in targeted industries
and technologies which is available in other states. The bill
authorizes the Commissioner of Economic Development to certify Startup
Business Enterprises (SBE) and allocates $7 million in total Angel Tax
Credits each year. The minimum investment is $100,000 and is capped at
$1 million in qualifying contributions to capital; and no single
certified SBE will be eligible for more than $1 million in qualifying
contributions. The investor is provided with a refundable credit equal
to 35 percent of such investor's qualifying investment (i.e. a $1
million capital investment would result in a $350,000 credit) The
credit is available to Article 9-A, Article 22, Article 32, and
Article 33 taxpayers.

JUSTIFICATION: New York State small businesses are at a disadvantage
to those located in other states which offer tax credits like the
Angel Tax Credit due to the lack of both public and private investment
dollars. Other states have economic development programs, as well as
angel tax credits, that support both business development and business
attraction efforts. In New York this results in a continued lack of
private investment in early stage companies often stunting their
growth and causing them to lag behind their competition.

In the past decade, more than 20 states have implemented programs to
both attract and or retain investment capital using tax credits, which
reduce the risk and cost of these ventures.

To become more competitive, New York State needs to create a tax
environment that promotes private investment within emerging business.
This bill will facilitate job growth and a more diverse statewide
economy.

PRIOR LEGISLATIVE HISTORY: S.6837/A.9939

FISCAL IMPLICATIONS: Assuming the Commissioner of Economic
Development allocates $7 million of Angel Tax Credits each year of the
three year period and each such Certified SBE raises the maximum
$1,000,000 in capital contributions based upon the credits, the total
annual cost to the State of New York credits would be $7 million with
a total cost over three years of $21 million.

EFFECTIVE DATE: Immediately.

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

                                 3732--B

                       2013-2014 Regular Sessions

                            I N  S E N A T E

                            February 13, 2013
                               ___________

Introduced  by  Sens.  DeFRANCISCO,  FELDER, GALLIVAN, MAZIARZ, O'BRIEN,
  SEWARD, VALESKY -- read twice and ordered printed, and when printed to
  be committed to the Committee on Local Government  --  recommitted  to
  the  Committee  on  Local Government in accordance with Senate Rule 6,
  sec. 8 -- committee discharged, bill  amended,  ordered  reprinted  as
  amended  and  recommitted  to  said committee -- committee discharged,
  bill amended, ordered reprinted as amended  and  recommitted  to  said
  committee

AN  ACT  to amend the general municipal law and the tax law, in relation
  to establishing an angel tax credit  for  investments  made  in  small
  businesses

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

  Section 1. The general municipal  law  is  amended  by  adding  a  new
section 959-c to read as follows:
  S 959-C. CERTIFIED STARTUP BUSINESS ENTERPRISE. (A) CERTIFICATION. (I)
THE COMMISSIONER SHALL APPROVE APPLICATIONS FOR QUALIFICATION OF A BUSI-
NESS  ENTERPRISE AS A CERTIFIED STARTUP BUSINESS ENTERPRISE. AS A CONDI-
TION FOR APPROVAL OF SUCH APPLICATION, THE COMMISSIONER IS AUTHORIZED TO
SPECIFY CERTAIN REQUIREMENTS TO BE SATISFIED AS A CONDITION FOR APPROVAL
OF A BUSINESS ENTERPRISE AS A CERTIFIED STARTUP BUSINESS  ENTERPRISE  AS
THE  COMMISSIONER DEEMS NECESSARY TO ENSURE THE QUALIFYING ANGEL INVEST-
MENT WILL MAKE A SUBSTANTIAL CONTRIBUTION TO THE ECONOMIC DEVELOPMENT OF
THIS STATE, INCLUDING THE USE OF  A  SYSTEM  OF  EVALUATION  OF  VARIOUS
APPLICANT BUSINESS ENTERPRISES IN A COMPETITIVE FASHION.
  (II)  WITH  RESPECT  TO AN APPROVED APPLICATION FOR QUALIFICATION OF A
BUSINESS ENTERPRISE AS A  CERTIFIED  STARTUP  BUSINESS  ENTERPRISE,  THE
COMMISSIONER  SHALL  ISSUE  TO SUCH BUSINESS ENTERPRISE A CERTIFICATE OF
QUALIFICATION AS A CERTIFIED STARTUP BUSINESS ENTERPRISE  SETTING  FORTH
THE  EFFECTIVE  DATE  OF  THE CERTIFICATION AND THE AMOUNT OF QUALIFYING
ANGEL INVESTMENT AWARDED TO SUCH BUSINESS ENTERPRISE, WHICH AMOUNT SHALL

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD07810-09-4

S. 3732--B                          2

BE NO LESS THAN ONE HUNDRED  THOUSAND  DOLLARS  AND  NO  MORE  THAN  ONE
MILLION DOLLARS.
  (III)  FOR  THE  PERIOD JULY FIRST, TWO THOUSAND FOURTEEN THROUGH JUNE
THIRTIETH, TWO THOUSAND FIFTEEN, THE  COMMISSIONER  MAY  CERTIFY  UP  TO
SEVEN  MILLION  DOLLARS  IN  QUALIFYING ANGEL INVESTMENT. FOR THE PERIOD
JULY FIRST, TWO THOUSAND FIFTEEN THROUGH JUNE  THIRTIETH,  TWO  THOUSAND
SIXTEEN,  THE  COMMISSIONER  MAY  CERTIFY UP TO SEVEN MILLION DOLLARS IN
QUALIFYING ANGEL INVESTMENT. FOR THE PERIOD  JULY  FIRST,  TWO  THOUSAND
SIXTEEN THROUGH JUNE THIRTIETH, TWO THOUSAND SEVENTEEN, THE COMMISSIONER
MAY CERTIFY UP TO SEVEN MILLION DOLLARS IN QUALIFYING ANGEL INVESTMENT.
  (B)  DEFINITIONS.  AS  USED IN THIS SECTION, THE FOLLOWING TERMS SHALL
HAVE THE FOLLOWING MEANINGS:
  (I) "CERTIFIED STARTUP BUSINESS  ENTERPRISE"  SHALL  MEAN  A  BUSINESS
ENTERPRISE LOCATED IN NEW YORK STATE:
  (1) WITH LESS THAN FIVE MILLION DOLLARS IN ANNUAL REVENUES;
  (2)  WHOSE  PRIMARY  ACTIVITY  CONSISTS  OF A QUALIFYING TECHNOLOGY OR
INNOVATION ACTIVITY; AND
  (3) THAT HAS BEEN CERTIFIED AS A CERTIFIED STARTUP BUSINESS ENTERPRISE
BY THE COMMISSIONER.
  (II) "QUALIFYING TECHNOLOGY OR INNOVATION ACTIVITY" SHALL MEAN:
  (1) BIOTECHNOLOGIES, WHICH SHALL BE DEFINED AS TECHNOLOGIES  INVOLVING
THE  SCIENTIFIC  MANIPULATION  OF  LIVING  ORGANISMS,  ESPECIALLY AT THE
MOLECULAR AND/OR THE SUB-MOLECULAR GENETIC LEVEL,  TO  PRODUCE  PRODUCTS
CONDUCIVE  TO  IMPROVING  THE  LIVES  AND HEALTH OF PLANTS, ANIMALS, AND
HUMANS; AND THE ASSOCIATED SCIENTIFIC RESEARCH, PHARMACOLOGICAL, MECHAN-
ICAL, AND COMPUTATIONAL APPLICATIONS AND SERVICES CONNECTED  WITH  THESE
IMPROVEMENTS;
  (2)  INFORMATION AND COMMUNICATION TECHNOLOGIES, EQUIPMENT AND SYSTEMS
THAT INVOLVE ADVANCED  COMPUTER  SOFTWARE  AND  HARDWARE,  VISUALIZATION
TECHNOLOGIES, AND HUMAN INTERFACE TECHNOLOGIES;
  (3)  ADVANCED  MATERIALS  AND PROCESSING TECHNOLOGIES THAT INVOLVE THE
DEVELOPMENT, MODIFICATION, OR IMPROVEMENT OF ONE OR  MORE  MATERIALS  OR
METHODS  TO  PRODUCE  DEVICES  AND  STRUCTURES WITH IMPROVED PERFORMANCE
CHARACTERISTICS OR SPECIAL FUNCTIONAL ATTRIBUTES, OR TO ACTIVATE,  SPEED
UP, OR OTHERWISE ALTER CHEMICAL, BIOCHEMICAL, OR MEDICAL PROCESSES;
  (4)  ELECTRONIC AND PHOTONIC DEVICES AND COMPONENTS FOR USE IN PRODUC-
ING ELECTRONIC, OPTOELECTRONIC, MECHANICAL  EQUIPMENT  AND  PRODUCTS  OF
ELECTRONIC DISTRIBUTION WITH INTERACTIVE MEDIA CONTENT;
  (5)  ENERGY  EFFICIENCY,  RENEWABLE ENERGY AND ENVIRONMENTAL TECHNOLO-
GIES, PRODUCTS, DEVICES AND SERVICES; OR
  (6) SMALL SCALE SYSTEMS INTEGRATION AND PACKAGING.
  (III) "QUALIFYING ANGEL INVESTMENT" SHALL MEAN A CONTRIBUTION  TO  THE
CAPITAL  OF  A CERTIFIED STARTUP BUSINESS ENTERPRISE, PROVIDED THAT SUCH
CONTRIBUTION TO CAPITAL IS MADE WITHIN TWELVE MONTHS AFTER THE EFFECTIVE
DATE OF THE CERTIFIED TECHNOLOGY VENTURE'S CERTIFICATE OF  QUALIFICATION
AS  A  CERTIFIED  TECHNOLOGY VENTURE AND SUCH CONTRIBUTION IS APPLIED BY
THE CERTIFIED STARTUP BUSINESS  ENTERPRISE  AGAINST  ITS  ALLOCATION  OF
QUALIFYING  ANGEL  INVESTMENT.  TOGETHER WITH ALL OTHER QUALIFYING ANGEL
INVESTMENTS MADE TO A SINGLE CERTIFIED STARTUP BUSINESS ENTERPRISE,  THE
TOTAL  QUALIFYING  ANGEL  INVESTMENT MAY NOT EXCEED ONE MILLION DOLLARS.
NOTHING HEREIN SHALL PROHIBIT A PERSON MAKING A QUALIFYING ANGEL INVEST-
MENT FROM MAKING ADDITIONAL CONTRIBUTIONS TO THE CAPITAL OF  THE  CERTI-
FIED STARTUP BUSINESS ENTERPRISE OR MAKING LOANS TO OR OTHER INVESTMENTS
IN  THE  CERTIFIED  STARTUP BUSINESS ENTERPRISE, PROVIDED, HOWEVER, THAT
SUCH OTHER CONTRIBUTIONS, LOANS AND INVESTMENTS SHALL NOT BE TREATED  AS
QUALIFYING ANGEL INVESTMENTS.

S. 3732--B                          3

  S 2. Section 210 of the tax law is amended by adding a new subdivision
12-H to read as follows:
  12-H.  ANGEL TAX CREDIT.  (A) ALLOWANCE OF CREDIT. A TAXPAYER THAT HAS
MADE A QUALIFYING ANGEL INVESTMENT, AS SUCH TERM IS DEFINED IN PARAGRAPH
(III) OF SUBDIVISION (B) OF SECTION NINE  HUNDRED  FIFTY-NINE-C  OF  THE
GENERAL  MUNICIPAL  LAW,  SHALL BE ALLOWED A CREDIT EQUAL TO THIRTY-FIVE
PERCENT OF THE AMOUNT OF SUCH QUALIFYING ANGEL INVESTMENT.
  (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  HIGHER OF THE AMOUNTS PRESCRIBED IN PARAGRAPHS (C) AND (D) OF
SUBDIVISION ONE OF THIS  SECTION.  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 TEN HUNDRED EIGHT-
Y-SIX OF THIS CHAPTER. PROVIDED, HOWEVER, THE PROVISIONS  OF  SUBSECTION
(C) OF SECTION TEN HUNDRED EIGHTY-EIGHT OF THIS CHAPTER NOTWITHSTANDING,
NO INTEREST SHALL BE PAID THEREON.
  S  3. Section 606 of the tax law is amended by adding a new subsection
(ccc) to read as follows:
  (CCC) ANGEL TAX CREDIT. (1) ALLOWANCE OF CREDIT. A TAXPAYER  THAT  HAS
MADE A QUALIFYING ANGEL INVESTMENT, AS SUCH TERM IS DEFINED IN PARAGRAPH
(III)  OF  SUBDIVISION  (B)  OF SECTION NINE HUNDRED FIFTY-NINE-C OF THE
GENERAL MUNICIPAL LAW, OR THAT IS A MEMBER OF  A  PARTNERSHIP  THAT  HAS
MADE  A  QUALIFYING ANGEL INVESTMENT, SHALL BE ALLOWED A CREDIT EQUAL TO
THIRTY-FIVE PERCENT OF THE AMOUNT OF SUCH  QUALIFYING  ANGEL  INVESTMENT
OR,  IN THE CASE OF A TAXPAYER WHO IS A MEMBER OF A PARTNERSHIP THAT HAS
MADE A QUALIFYING ANGEL INVESTMENT, A PORTION OF SUCH  QUALIFYING  ANGEL
INVESTMENT  EQUAL  TO  THE  PORTION  OF  ITEMS OF INCOME, GAIN, LOSS AND
DEDUCTION ASSOCIATED WITH THE QUALIFYING ANGEL INVESTMENT PROPERLY ALLO-
CABLE TO SUCH TAXPAYER UNDER SECTION 704 OF THE  INTERNAL  REVENUE  CODE
FOR THE TAXABLE YEAR.
  (2)  APPLICATION  OF CREDIT. IF THE AMOUNT OF THE CREDIT ALLOWED UNDER
THIS SUBSECTION FOR ANY TAXABLE YEAR SHALL EXCEED THE TAXPAYER'S TAX FOR
SUCH YEAR, 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.
  S 4. Section 1456 of the tax law is amended by adding a new subsection
(aa) to read as follows:
  (AA)  ANGEL  TAX  CREDIT. (1) ALLOWANCE OF CREDIT. A TAXPAYER THAT HAS
MADE A QUALIFYING ANGEL INVESTMENT, AS SUCH TERM IS DEFINED IN PARAGRAPH
(III) OF SUBDIVISION (B) OF SECTION NINE  HUNDRED  FIFTY-NINE-C  OF  THE
GENERAL  MUNICIPAL  LAW,  SHALL BE ALLOWED A CREDIT EQUAL TO THIRTY-FIVE
PERCENT OF THE AMOUNT OF SUCH QUALIFYING ANGEL INVESTMENT.
  (2) APPLICATION OF CREDIT. THE CREDIT ALLOWED  UNDER  THIS  SUBSECTION
FOR  ANY TAXABLE YEAR SHALL NOT REDUCE THE TAX DUE FOR SUCH YEAR TO LESS
THAN THE MINIMUM TAX FIXED BY SUBSECTION (B) OF SECTION FOURTEEN HUNDRED
FIFTY-FIVE OF THIS ARTICLE. HOWEVER, IF THE  AMOUNT  OF  CREDIT  ALLOWED
UNDER  THIS  SUBSECTION  FOR  ANY  TAXABLE  YEAR REDUCES THE TAX TO SUCH
AMOUNT, THEN 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 TEN HUNDRED EIGHT-
Y-SIX OF THIS CHAPTER. PROVIDED, HOWEVER, THE PROVISIONS  OF  SUBSECTION
(C) OF SECTION TEN HUNDRED EIGHTY-EIGHT OF THIS CHAPTER NOTWITHSTANDING,
NO INTEREST SHALL BE PAID THEREON.

S. 3732--B                          4

  S  5.  Section 1511 of the tax law is amended by adding a new subdivi-
sion (dd) to read as follows:
  (DD)  ANGEL  TAX  CREDIT. (1) ALLOWANCE OF CREDIT. A TAXPAYER THAT HAS
MADE A QUALIFYING ANGEL INVESTMENT, AS SUCH TERM IS DEFINED IN PARAGRAPH
(III) OF SUBDIVISION (B) OF SECTION NINE  HUNDRED  FIFTY-NINE-C  OF  THE
GENERAL  MUNICIPAL  LAW,  SHALL BE ALLOWED A CREDIT EQUAL TO THIRTY-FIVE
PERCENT OF THE AMOUNT OF SUCH QUALIFYING ANGEL INVESTMENT.
  (2) 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 MINIMUM TAX FIXED BY  PARAGRAPH  FOUR  OF  SUBDIVISION  (A)  OF
SECTION  FIFTEEN  HUNDRED  TWO  OF  THIS  ARTICLE  OR BY SECTION FIFTEEN
HUNDRED TWO-A OF THIS ARTICLE, WHICHEVER IS APPLICABLE. HOWEVER, IF  THE
AMOUNT  OF  CREDIT  ALLOWED  UNDER THIS SUBDIVISION FOR ANY TAXABLE YEAR
REDUCES THE TAX TO SUCH AMOUNT, THEN  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  TEN  HUNDRED EIGHTY-SIX OF THIS CHAPTER. PROVIDED, HOWEVER, THE
PROVISIONS OF SUBSECTION (C) OF SECTION TEN HUNDRED EIGHTY-EIGHT OF THIS
CHAPTER NOTWITHSTANDING, NO INTEREST SHALL BE PAID THEREON.
  S 6. This act shall take effect immediately; provided that the  amend-
ments  to  section  1456 of the tax law made by section four of this act
shall not affect the repeal of such section and shall be deemed repealed
therewith.

Co-Sponsors

view additional co-sponsors

S3732C (ACTIVE) - Bill Details

Current Committee:
Law Section:
Economic Development Law
Laws Affected:
Add §441, Ec Dev L; amd §§210, 606, 1456 & 1511, Tax L
Versions Introduced in 2011-2012 Legislative Session:
S6837

S3732C (ACTIVE) - Bill Texts

view summary

Establishes an angel tax credit for investors who invest in certified startup business enterprises.

view sponsor memo
BILL NUMBER:S3732C

TITLE OF BILL: An act to amend the economic development law and the tax
law, in relation to establishing an angel tax credit for investments
made in small businesses

PURPOSE OR GENERAL IDEA OF BILL:

To establish an angel tax credit for investors who invest in certified
startup business enterprises.

SUMMARY OF SPECIFIC PROVISIONS:

This bill creates a new angel tax credit that provides incentives for
investment in targeted industries and technologies which is available in
other states. The bill authorizes the Commissioner of Economic Develop-
ment to certify Startup Business Enterprises(SBE) and allocates $7
million in total Angel Tax Credits each year. The minimum investment is
$100,000 and is capped at $1 million in qualifying contributions to
capital; and no single certified SBE will be eligible for more than $1
million in qualifying contributions. The investor is provided with a
refundable credit equal to 35 percent of such investor's qualifying
investment (i.e. a $1 million capital investment would result in a
$350,000 credit) The credit is available to Article 9-A, Article 22,
Article 32, and Article 33 taxpayers.

JUSTIFICATION:

New York State small businesses are at a disadvantage to those located
in other states which offer tax credits like the Angel Tax Credit due to
the lack of both public and private investment dollars. Other states
have economic development programs, as well as angel tax credits, that
support both business development and business attraction efforts. In
New York this results in a continued lack of private investment in early
stage companies often stunting their growth and causing them to lag
behind their competition.

In the past decade, more than 20 states have implemented programs to
both attract and or retain investment capital using tax credits, which
reduce the risk and cost of these ventures.

To become more competitive, New York State needs to create a tax envi-
ronment that promotes private investment within emerging business. This
bill will facilitate job growth and a more diverse statewide economy.

PRIOR LEGISLATIVE HISTORY:

S.6837/A.9939

FISCAL IMPLICATIONS:

Assuming the Commissioner of Economic Development allocates $7 million
of Angel Tax Credits each year of the three year period and each such
Certified SBE raises the maximum $1,000,000 in capital contributions
based upon the credits, the total annual cost to the State of New York
credits would be $7 million with a total cost over three years of $21
million.

EFFECTIVE DATE:

Immediately.

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

                                 3732--C
    Cal. No. 943

                       2013-2014 Regular Sessions

                            I N  S E N A T E

                            February 13, 2013
                               ___________

Introduced  by  Sens.  DeFRANCISCO,  FELDER, GALLIVAN, MAZIARZ, O'BRIEN,
  SEWARD, VALESKY -- read twice and ordered printed, and when printed to
  be committed to the Committee on Local Government  --  recommitted  to
  the  Committee  on  Local Government in accordance with Senate Rule 6,
  sec. 8 -- committee discharged, bill  amended,  ordered  reprinted  as
  amended  and  recommitted  to  said committee -- committee discharged,
  bill amended, ordered reprinted as amended  and  recommitted  to  said
  committee  --  reported favorably from said committee and committed to
  the Committee on Finance -- reported favorably  from  said  committee,
  ordered  to  first  and  second  report,  ordered  to a third reading,
  amended and ordered reprinted, retaining its place  in  the  order  of
  third reading

AN  ACT  to  amend  the  economic  development  law  and the tax law, in
  relation to establishing an angel tax credit for investments  made  in
  small businesses

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

  Section 1. The economic development law is amended  by  adding  a  new
section 441 to read as follows:
  S  441.  CERTIFIED STARTUP BUSINESS ENTERPRISE. 1.  CERTIFICATION. (A)
THE COMMISSIONER SHALL APPROVE APPLICATIONS FOR QUALIFICATION OF A BUSI-
NESS ENTERPRISE AS A CERTIFIED STARTUP BUSINESS ENTERPRISE. AS A  CONDI-
TION FOR APPROVAL OF SUCH APPLICATION, THE COMMISSIONER IS AUTHORIZED TO
SPECIFY CERTAIN REQUIREMENTS TO BE SATISFIED AS A CONDITION FOR APPROVAL
OF  A  BUSINESS ENTERPRISE AS A CERTIFIED STARTUP BUSINESS ENTERPRISE AS
THE COMMISSIONER DEEMS NECESSARY TO ENSURE THE QUALIFYING ANGEL  INVEST-
MENT WILL MAKE A SUBSTANTIAL CONTRIBUTION TO THE ECONOMIC DEVELOPMENT OF
THIS  STATE,  INCLUDING  THE  USE  OF  A SYSTEM OF EVALUATION OF VARIOUS
APPLICANT BUSINESS ENTERPRISES IN A COMPETITIVE FASHION.
  (B) WITH RESPECT TO AN APPROVED APPLICATION  FOR  QUALIFICATION  OF  A
BUSINESS  ENTERPRISE  AS  A  CERTIFIED  STARTUP BUSINESS ENTERPRISE, THE

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD07810-10-4

S. 3732--C                          2

COMMISSIONER SHALL ISSUE TO SUCH BUSINESS ENTERPRISE  A  CERTIFICATE  OF
QUALIFICATION  AS  A CERTIFIED STARTUP BUSINESS ENTERPRISE SETTING FORTH
THE EFFECTIVE DATE OF THE CERTIFICATION AND  THE  AMOUNT  OF  QUALIFYING
ANGEL INVESTMENT AWARDED TO SUCH BUSINESS ENTERPRISE, WHICH AMOUNT SHALL
BE  NO  LESS  THAN  ONE  HUNDRED  THOUSAND  DOLLARS AND NO MORE THAN ONE
MILLION DOLLARS.
  (C) FOR THE PERIOD JULY FIRST,  TWO  THOUSAND  FOURTEEN  THROUGH  JUNE
THIRTIETH,  TWO  THOUSAND  FIFTEEN,  THE  COMMISSIONER MAY CERTIFY UP TO
SEVEN MILLION DOLLARS IN QUALIFYING ANGEL  INVESTMENT.  FOR  THE  PERIOD
JULY  FIRST,  TWO  THOUSAND FIFTEEN THROUGH JUNE THIRTIETH, TWO THOUSAND
SIXTEEN, THE COMMISSIONER MAY CERTIFY UP TO  SEVEN  MILLION  DOLLARS  IN
QUALIFYING  ANGEL  INVESTMENT.  FOR  THE PERIOD JULY FIRST, TWO THOUSAND
SIXTEEN THROUGH JUNE THIRTIETH, TWO THOUSAND SEVENTEEN, THE COMMISSIONER
MAY CERTIFY UP TO SEVEN MILLION DOLLARS IN QUALIFYING ANGEL INVESTMENT.
  2. DEFINITIONS. AS USED IN THIS SECTION,  THE  FOLLOWING  TERMS  SHALL
HAVE THE FOLLOWING MEANINGS:
  (A)  "CERTIFIED  STARTUP  BUSINESS  ENTERPRISE"  SHALL MEAN A BUSINESS
ENTERPRISE LOCATED IN NEW YORK STATE:
  (I) WITH LESS THAN FIVE MILLION DOLLARS IN ANNUAL REVENUES;
  (II) WHOSE PRIMARY ACTIVITY CONSISTS OF  A  QUALIFYING  TECHNOLOGY  OR
INNOVATION ACTIVITY; AND
  (III)  THAT  HAS BEEN CERTIFIED AS A CERTIFIED STARTUP BUSINESS ENTER-
PRISE BY THE COMMISSIONER.
  (B) "QUALIFYING TECHNOLOGY OR INNOVATION ACTIVITY" SHALL MEAN:
  (I) BIOTECHNOLOGIES, WHICH SHALL BE DEFINED AS TECHNOLOGIES  INVOLVING
THE  SCIENTIFIC  MANIPULATION  OF  LIVING  ORGANISMS,  ESPECIALLY AT THE
MOLECULAR AND/OR THE SUB-MOLECULAR GENETIC LEVEL,  TO  PRODUCE  PRODUCTS
CONDUCIVE  TO  IMPROVING  THE  LIVES  AND HEALTH OF PLANTS, ANIMALS, AND
HUMANS; AND THE ASSOCIATED SCIENTIFIC RESEARCH, PHARMACOLOGICAL, MECHAN-
ICAL, AND COMPUTATIONAL APPLICATIONS AND SERVICES CONNECTED  WITH  THESE
IMPROVEMENTS;
  (II) INFORMATION AND COMMUNICATION TECHNOLOGIES, EQUIPMENT AND SYSTEMS
THAT  INVOLVE  ADVANCED  COMPUTER  SOFTWARE  AND HARDWARE, VISUALIZATION
TECHNOLOGIES, AND HUMAN INTERFACE TECHNOLOGIES;
  (III) ADVANCED MATERIALS AND PROCESSING TECHNOLOGIES THAT INVOLVE  THE
DEVELOPMENT,  MODIFICATION,  OR  IMPROVEMENT OF ONE OR MORE MATERIALS OR
METHODS TO PRODUCE DEVICES  AND  STRUCTURES  WITH  IMPROVED  PERFORMANCE
CHARACTERISTICS  OR SPECIAL FUNCTIONAL ATTRIBUTES, OR TO ACTIVATE, SPEED
UP, OR OTHERWISE ALTER CHEMICAL, BIOCHEMICAL, OR MEDICAL PROCESSES;
  (IV) ELECTRONIC AND PHOTONIC DEVICES AND COMPONENTS FOR USE IN PRODUC-
ING ELECTRONIC, OPTOELECTRONIC, MECHANICAL  EQUIPMENT  AND  PRODUCTS  OF
ELECTRONIC DISTRIBUTION WITH INTERACTIVE MEDIA CONTENT;
  (V)  ENERGY  EFFICIENCY,  RENEWABLE ENERGY AND ENVIRONMENTAL TECHNOLO-
GIES, PRODUCTS, DEVICES AND SERVICES; OR
  (VI) SMALL SCALE SYSTEMS INTEGRATION AND PACKAGING.
  (C) "QUALIFYING ANGEL INVESTMENT" SHALL MEAN  A  CONTRIBUTION  TO  THE
CAPITAL  OF  A CERTIFIED STARTUP BUSINESS ENTERPRISE, PROVIDED THAT SUCH
CONTRIBUTION TO CAPITAL IS MADE WITHIN TWELVE MONTHS AFTER THE EFFECTIVE
DATE OF THE CERTIFIED TECHNOLOGY VENTURE'S CERTIFICATE OF  QUALIFICATION
AS  A  CERTIFIED  TECHNOLOGY VENTURE AND SUCH CONTRIBUTION IS APPLIED BY
THE CERTIFIED STARTUP BUSINESS  ENTERPRISE  AGAINST  ITS  ALLOCATION  OF
QUALIFYING  ANGEL  INVESTMENT.  TOGETHER WITH ALL OTHER QUALIFYING ANGEL
INVESTMENTS MADE TO A SINGLE CERTIFIED STARTUP BUSINESS ENTERPRISE,  THE
TOTAL  QUALIFYING  ANGEL  INVESTMENT MAY NOT EXCEED ONE MILLION DOLLARS.
NOTHING HEREIN SHALL PROHIBIT A PERSON MAKING A QUALIFYING ANGEL INVEST-
MENT FROM MAKING ADDITIONAL CONTRIBUTIONS TO THE CAPITAL OF  THE  CERTI-

S. 3732--C                          3

FIED STARTUP BUSINESS ENTERPRISE OR MAKING LOANS TO OR OTHER INVESTMENTS
IN  THE  CERTIFIED  STARTUP BUSINESS ENTERPRISE, PROVIDED, HOWEVER, THAT
SUCH OTHER CONTRIBUTIONS, LOANS AND INVESTMENTS SHALL NOT BE TREATED  AS
QUALIFYING ANGEL INVESTMENTS.
  S 2. Section 210 of the tax law is amended by adding a new subdivision
12-H to read as follows:
  12-H.  ANGEL TAX CREDIT.  (A) ALLOWANCE OF CREDIT. A TAXPAYER THAT HAS
MADE A QUALIFYING ANGEL INVESTMENT, AS SUCH TERM IS DEFINED IN PARAGRAPH
(C) OF SUBDIVISION TWO OF SECTION FOUR HUNDRED FORTY-ONE OF THE ECONOMIC
DEVELOPMENT LAW, SHALL BE ALLOWED A CREDIT EQUAL TO THIRTY-FIVE  PERCENT
OF THE AMOUNT OF SUCH QUALIFYING ANGEL INVESTMENT.
  (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 HIGHER OF THE AMOUNTS PRESCRIBED IN PARAGRAPHS (C) AND  (D)  OF
SUBDIVISION  ONE  OF  THIS  SECTION.  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 TEN HUNDRED EIGHT-
Y-SIX  OF  THIS CHAPTER. PROVIDED, HOWEVER, THE PROVISIONS OF SUBSECTION
(C) OF SECTION TEN HUNDRED EIGHTY-EIGHT OF THIS CHAPTER NOTWITHSTANDING,
NO INTEREST SHALL BE PAID THEREON.
  S 3. Section 606 of the tax law is amended by adding a new  subsection
(ccc) to read as follows:
  (CCC)  ANGEL  TAX CREDIT. (1) ALLOWANCE OF CREDIT. A TAXPAYER THAT HAS
MADE A QUALIFYING ANGEL INVESTMENT, AS SUCH TERM IS DEFINED IN PARAGRAPH
(C) OF SUBDIVISION TWO OF SECTION FOUR HUNDRED FORTY-ONE OF THE ECONOMIC
DEVELOPMENT LAW, OR THAT IS A MEMBER OF A PARTNERSHIP THAT  HAS  MADE  A
QUALIFYING  ANGEL INVESTMENT, SHALL BE ALLOWED A CREDIT EQUAL TO THIRTY-
FIVE PERCENT OF THE AMOUNT OF SUCH QUALIFYING ANGEL  INVESTMENT  OR,  IN
THE  CASE OF A TAXPAYER WHO IS A MEMBER OF A PARTNERSHIP THAT HAS MADE A
QUALIFYING ANGEL INVESTMENT, A PORTION OF SUCH QUALIFYING ANGEL  INVEST-
MENT  EQUAL  TO THE PORTION OF ITEMS OF INCOME, GAIN, LOSS AND DEDUCTION
ASSOCIATED WITH THE QUALIFYING ANGEL INVESTMENT  PROPERLY  ALLOCABLE  TO
SUCH  TAXPAYER  UNDER  SECTION  704 OF THE INTERNAL REVENUE CODE FOR THE
TAXABLE YEAR.
  (2) APPLICATION OF CREDIT. IF THE AMOUNT OF THE CREDIT  ALLOWED  UNDER
THIS SUBSECTION FOR ANY TAXABLE YEAR SHALL EXCEED THE TAXPAYER'S TAX FOR
SUCH  YEAR,  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.
  S 4. Section 1456 of the tax law is amended by adding a new subsection
(aa) to read as follows:
  (AA) ANGEL TAX CREDIT. (1) ALLOWANCE OF CREDIT. A  TAXPAYER  THAT  HAS
MADE A QUALIFYING ANGEL INVESTMENT, AS SUCH TERM IS DEFINED IN PARAGRAPH
(C) OF SUBDIVISION TWO OF SECTION FOUR HUNDRED FORTY-ONE OF THE ECONOMIC
DEVELOPMENT  LAW, SHALL BE ALLOWED A CREDIT EQUAL TO THIRTY-FIVE PERCENT
OF THE AMOUNT OF SUCH QUALIFYING ANGEL INVESTMENT.
  (2) APPLICATION OF CREDIT. THE CREDIT ALLOWED  UNDER  THIS  SUBSECTION
FOR  ANY TAXABLE YEAR SHALL NOT REDUCE THE TAX DUE FOR SUCH YEAR TO LESS
THAN THE MINIMUM TAX FIXED BY SUBSECTION (B) OF SECTION FOURTEEN HUNDRED
FIFTY-FIVE OF THIS ARTICLE. HOWEVER, IF THE  AMOUNT  OF  CREDIT  ALLOWED
UNDER  THIS  SUBSECTION  FOR  ANY  TAXABLE  YEAR REDUCES THE TAX TO SUCH
AMOUNT, THEN ANY AMOUNT OF CREDIT THUS NOT DEDUCTIBLE  IN  SUCH  TAXABLE
YEAR  SHALL  BE  TREATED  AS  AN  OVERPAYMENT  OF  TAX TO BE CREDITED OR

S. 3732--C                          4

REFUNDED IN ACCORDANCE WITH THE PROVISIONS OF SECTION TEN HUNDRED EIGHT-
Y-SIX OF THIS CHAPTER. PROVIDED, HOWEVER, THE PROVISIONS  OF  SUBSECTION
(C) OF SECTION TEN HUNDRED EIGHTY-EIGHT OF THIS CHAPTER NOTWITHSTANDING,
NO INTEREST SHALL BE PAID THEREON.
  S  5.  Section 1511 of the tax law is amended by adding a new subdivi-
sion (dd) to read as follows:
  (DD) ANGEL TAX CREDIT. (1) ALLOWANCE OF CREDIT. A  TAXPAYER  THAT  HAS
MADE A QUALIFYING ANGEL INVESTMENT, AS SUCH TERM IS DEFINED IN PARAGRAPH
(C) OF SUBDIVISION TWO OF SECTION FOUR HUNDRED FORTY-ONE OF THE ECONOMIC
DEVELOPMENT  LAW, SHALL BE ALLOWED A CREDIT EQUAL TO THIRTY-FIVE PERCENT
OF THE AMOUNT OF SUCH QUALIFYING ANGEL INVESTMENT.
  (2) 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 MINIMUM TAX FIXED BY  PARAGRAPH  FOUR  OF  SUBDIVISION  (A)  OF
SECTION  FIFTEEN  HUNDRED  TWO  OF  THIS  ARTICLE  OR BY SECTION FIFTEEN
HUNDRED TWO-A OF THIS ARTICLE, WHICHEVER IS APPLICABLE. HOWEVER, IF  THE
AMOUNT  OF  CREDIT  ALLOWED  UNDER THIS SUBDIVISION FOR ANY TAXABLE YEAR
REDUCES THE TAX TO SUCH AMOUNT, THEN  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  TEN  HUNDRED EIGHTY-SIX OF THIS CHAPTER. PROVIDED, HOWEVER, THE
PROVISIONS OF SUBSECTION (C) OF SECTION TEN HUNDRED EIGHTY-EIGHT OF THIS
CHAPTER NOTWITHSTANDING, NO INTEREST SHALL BE PAID THEREON.
  S 6. This act shall take effect immediately; provided that the  amend-
ments  to  section  1456 of the tax law made by section four of this act
shall not affect the repeal of such section and shall be deemed repealed
therewith.

Comments

Open Legislation comments facilitate discussion of New York State legislation. All comments are subject to moderation. Comments deemed off-topic, commercial, campaign-related, self-promotional; or that contain profanity or hate speech; or that link to sites outside of the nysenate.gov domain are not permitted, and will not be published. Comment moderation is generally performed Monday through Friday.

By contributing or voting you agree to the Terms of Participation and verify you are over 13.