S T A T E   O F   N E W   Y O R K
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                                 7045--A

                       2015-2016 Regular Sessions

                          I N  A S S E M B L Y

                             April 21, 2015
                               ___________

Introduced  by  M. of A. SCHIMMINGER, JAFFEE, MAGNARELLI, BLAKE, STIRPE,
  RIVERA, ENGLEBRIGHT, SKARTADOS, SCHIMEL -- Multi-Sponsored by -- M. of
  A.  ABBATE, COOK, SOLAGES, THIELE -- read once  and  referred  to  the
  Committee  on  Ways  and Means -- recommitted to the Committee on Ways
  and Means in accordance with Assembly Rule  3,  sec.  2  --  committee
  discharged, bill amended, ordered reprinted as amended and recommitted
  to said committee

AN  ACT  to amend the tax law, in relation to the creation of a biotech-
  nology research and development investment tax credit

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

  Section 1. The tax law is amended by adding a new section 24-b to read
as follows:
  S  24-B.  BIOSCIENCE  AND  MEDICAL  TECHNOLOGY  (BIO/MED) RESEARCH AND
DEVELOPMENT TAX CREDIT.  (A) DEFINITIONS. AS USED IN THIS  SECTION,  THE
FOLLOWING TERMS SHALL HAVE THE FOLLOWING MEANINGS:
  (1) "QUALIFIED BIO/MED RESEARCH AND DEVELOPMENT COSTS" MEANS QUALIFIED
RESEARCH  EXPENSES AND BASIC RESEARCH PAYMENTS AS DEFINED IN SECTIONS 41
(B) AND (E) OF THE INTERNAL REVENUE CODE, EXCEPT  IT  DOES  NOT  INCLUDE
EXPENSES  INCURRED  FOR  QUALIFIED  RESEARCH OR BASIC RESEARCH CONDUCTED
OUTSIDE OF NEW YORK STATE, FOR PURPOSES OF DEVELOPING A PRODUCT OR PHAR-
MACEUTICAL, INSTRUMENT,  APPARATUS,  MACHINE,  CONTRIVANCE,  IMPLANT  OR
OTHER SIMILAR OR RELATED ARTICLE, INCLUDING A COMPONENT PART OR ACCESSO-
RY THAT ARE APPLICABLE TO THE PREVENTION, TREATMENT OR CURE OF A DISEASE
OR CONDITION OF HUMAN BEINGS.
  (2) "QUALIFIED BIO/MED COMPANY" IS A CORPORATION, PARTNERSHIP, LIMITED
PARTNERSHIP  OR  OTHER  ENTITY  WHICH  IS ENGAGED IN THE PRODUCTION OF A
PRODUCT OR PHARMACEUTICAL, INSTRUMENT, APPARATUS, MACHINE,  CONTRIVANCE,
IMPLANT  OR OTHER SIMILAR OR RELATED ARTICLE, INCLUDING A COMPONENT PART
OR ACCESSORY THAT ARE APPLICABLE TO THE PREVENTION, TREATMENT OR CURE OF
A DISEASE OR CONDITION OF HUMAN BEINGS.

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD09341-03-6
              

A. 7045--A                          2

  (B) (1) ALLOWANCE OF CREDIT. A TAXPAYER WHICH IS A  QUALIFIED  BIO/MED
COMPANY,  SOLE  PROPRIETOR  OR  A  MEMBER OF A PARTNERSHIP, AND WHICH IS
SUBJECT TO TAX UNDER ARTICLES NINE-A  OR  TWENTY-TWO  OF  THIS  CHAPTER,
SHALL  BE  ALLOWED A CREDIT AGAINST SUCH TAX, PURSUANT TO THE PROVISIONS
REFERENCED IN SUBDIVISION (D) OF THIS SECTION, TO BE COMPUTED AS HEREIN-
AFTER PROVIDED.
  (2)  THE  AMOUNT OF THE CREDIT SHALL BE THE PRODUCT (OR PRO RATA SHARE
OF THE PRODUCT, IN THE CASE OF A MEMBER OF  A  PARTNERSHIP)  OF  FIFTEEN
PERCENT AND THE QUALIFIED BIO/MED RESEARCH AND DEVELOPMENT COSTS PAID OR
INCURRED  IN THE STATE. THE CREDIT SHALL BE ALLOWED FOR THE TAXABLE YEAR
IN WHICH THE QUALIFIED BIO/MED RESEARCH AND DEVELOPMENT ACTIVITY OCCURS.
IF THE AMOUNT OF THE CREDIT IS AT LEAST ONE  MILLION  DOLLARS  BUT  LESS
THAN  FIVE  MILLION DOLLARS, THE CREDIT SHALL BE CLAIMED OVER A TWO YEAR
PERIOD BEGINNING IN THE FIRST TAXABLE YEAR IN WHICH THE  CREDIT  MAY  BE
CLAIMED  AND  IN  THE NEXT SUCCEEDING TAXABLE YEAR, WITH ONE-HALF OF THE
AMOUNT OF CREDIT ALLOWED BEING CLAIMED IN EACH YEAR. IF  THE  AMOUNT  OF
THE CREDIT IS AT LEAST FIVE MILLION DOLLARS, THE CREDIT SHALL BE CLAIMED
OVER  A  THREE  YEAR PERIOD BEGINNING IN THE FIRST TAXABLE YEAR IN WHICH
THE CREDIT MAY BE CLAIMED AND IN THE NEXT TWO SUCCEEDING TAXABLE  YEARS,
WITH ONE-THIRD OF THE AMOUNT OF THE CREDIT ALLOWED BEING CLAIMED IN EACH
YEAR.
  (3)  NO  QUALIFIED  BIO/MED  RESEARCH  AND DEVELOPMENT 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 PURSUANT TO THIS CHAPTER.
  (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-B: SUBDIVISION 49.
  (2) ARTICLE 22: SECTION 606: SUBSECTION (CCC).
  (D) ALLOCATION OF CREDIT. (1) THE  AGGREGATE  AMOUNT  OF  TAX  CREDITS
ALLOWED  UNDER  THIS  SECTION,  SUBDIVISION  FORTY-NINE  OF  SECTION TWO
HUNDRED TEN-B AND SUBSECTION (CCC) OF SECTION SIX HUNDRED  SIX  OF  THIS
CHAPTER IN ANY CALENDAR YEAR SHALL BE FIFTY MILLION DOLLARS IN TWO THOU-
SAND  SIXTEEN, AND EACH SUCCEEDING YEAR UP TO AND INCLUDING TWO THOUSAND
NINETEEN.
  (2) FOR THE PERIOD TWO THOUSAND SEVENTEEN THROUGH TWO THOUSAND TWENTY,
IN ADDITION TO THE AMOUNT OF CREDIT ESTABLISHED IN PARAGRAPH ONE OF THIS
SUBDIVISION, A TAXPAYER SHALL BE ALLOWED A CREDIT EQUAL TO  THE  PRODUCT
(OR PRO RATA SHARE OF THE PRODUCT, IN THE CASE OF A MEMBER OF A PARTNER-
SHIP)  OF  FIVE PERCENT AND THE AMOUNT OF THE QUALIFIED BIO/MED RESEARCH
AND DEVELOPMENT COSTS BY A QUALIFIED BIO/MED COMPANY IN ONE OF THE COUN-
TIES SPECIFIED IN THIS PARAGRAPH. FOR PURPOSES OF THIS ADDITIONAL  CRED-
IT,  THE  SERVICES  MUST  BE  PERFORMED OR THE PERSONAL PROPERTY MUST BE
INSTALLED IN ONE OR MORE OF THE FOLLOWING COUNTIES:   ALBANY,  ALLEGANY,
BROOME,  CATTARAUGUS,  CAYUGA,  CHAUTAUQUA,  CHEMUNG, CHENANGO, CLINTON,
COLUMBIA, CORTLAND, DELAWARE, DUTCHESS, ERIE, ESSEX,  FRANKLIN,  FULTON,
GENESEE, GREENE, HAMILTON, HERKIMER, JEFFERSON, LEWIS, LIVINGSTON, MADI-
SON,  MONROE,  MONTGOMERY,  NIAGARA, ONEIDA, ONONDAGA, ONTARIO, ORLEANS,
OSWEGO, OTSEGO, RENSSELAER, SARATOGA, SCHENECTADY, SCHOHARIE,  SCHUYLER,
SENECA,  ST.  LAWRENCE,  STEUBEN,  SULLIVAN,  TIOGA,  TOMPKINS,  ULSTER,
WARREN, WASHINGTON, WAYNE, WYOMING, OR YATES. THE  AGGREGATE  AMOUNT  OF
TAX CREDITS ALLOWED PURSUANT TO THE AUTHORITY OF THIS PARAGRAPH SHALL BE
TEN  MILLION  DOLLARS EACH YEAR DURING THE PERIOD TWO THOUSAND SEVENTEEN
THROUGH TWO THOUSAND TWENTY OF THE ANNUAL ALLOCATION MADE  AVAILABLE  TO
THE  PROGRAM  PURSUANT TO THIS SUBDIVISION. IF THE TOTAL AMOUNT OF ALLO-

A. 7045--A                          3

CATED CREDITS APPLIED FOR UNDER THIS PARAGRAPH IN ANY YEAR  EXCEEDS  THE
AGGREGATE  AMOUNT  OF TAX CREDITS ALLOWED FOR SUCH YEAR UNDER THIS PARA-
GRAPH, SUCH EXCESS SHALL BE TREATED AS HAVING BEEN APPLIED  FOR  ON  THE
FIRST DAY OF THE NEXT YEAR. IF THE TOTAL AMOUNT OF ALLOCATED TAX CREDITS
APPLIED  FOR  UNDER THIS PARAGRAPH AT THE CONCLUSION OF ANY YEAR IS LESS
THAN TEN MILLION DOLLARS, THE REMAINDER SHALL BE TREATED AS PART OF  THE
ANNUAL  ALLOCATION MADE AVAILABLE TO THE PROGRAM PURSUANT TO SUBDIVISION
(D) OF THIS SECTION. HOWEVER, IN NO EVENT MAY THE TOTAL OF  THE  CREDITS
ALLOCATED  UNDER  THIS  PARAGRAPH EXCEED TEN MILLION DOLLARS IN ANY YEAR
DURING THE PERIOD TWO THOUSAND SEVENTEEN THROUGH TWO THOUSAND TWENTY.
  S 2. Section 210-B of the tax law is amended by adding a new  subdivi-
sion 49 to read as follows:
  49.  BIO/MED  RESEARCH  AND  DEVELOPMENT INVESTMENT CREDIT. A TAXPAYER
SHALL BE ALLOWED A CREDIT, TO BE COMPUTED AS PROVIDED IN  SECTION  TWEN-
TY-FOUR-B  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 OR IF THE TAXPAYER
OTHERWISE PAYS TAX BASED ON THE FIXED DOLLAR MINIMUM AMOUNT, ANY  AMOUNT
OF  CREDIT  THUS NOT DEDUCTIBLE IN SUCH TAXABLE YEAR SHALL BE TREATED AS
AN OVERPAYMENT OF TAX TO BE CREDITED 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.
  S 3. Section 606 of the tax law is amended by adding a new  subsection
(ccc) to read as follows:
  (CCC)  BIO/MED  RESEARCH AND DEVELOPMENT INVESTMENT CREDIT. A TAXPAYER
SHALL BE ALLOWED A CREDIT, TO BE COMPUTED AS PROVIDED IN  SECTION  TWEN-
TY-FOUR-B  OF  THIS CHAPTER, AGAINST THE TAX IMPOSED BY THIS ARTICLE. 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  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 4. This act shall take effect immediately.