Tax Credits and Incentives in New York

Transcription

1 Tax Credits & Incentives: What s In & What s Out? Presented By: Paul Gevertzman, CPA, JD Practice Leader, Tax Credits & Incentives Group paul.gevertzman@anchin.com Richard Wolbrom Senior Manager, Tax Credits & Incentives Group richard.wolbrom@anchin.com

2 Federal Work Opportunity Tax Credit (WOTC) A federal tax credit available to all private sector businesses hiring employees from certain targeted groups. Credit is up to $2,400 per new full time employee and up to $9,600 for disabled veterans. 1

3 Federal Historic Preservation Tax Credit A federal tax credit for rehabilitating non-historic, non residential commercial buildings built before 1936 of 10% of investment. There is a 20% tax credit for rehabilitating income-producing historic buildings that meet certain rehabilitation standards set forth by the Department of the Interior. 2

4 Federal Section 179D A corporate tax deduction of $ per square foot for commercial & government buildings that meet target energy saving levels when built or renovated. Deductions associated with government buildings can be transferred to the primary designer. 3

5 Federal Business Energy Investment Tax Credit A corporate Tax Credit equal to 30% of investment in renewable technologies (e.g. - solar or wind systems) or 10% credit for geothermal systems. Credit can be taken against the AMT and can be taken as a grant rather than a tax credit. 4

6 Federal Research & Development Tax Credit The R&D Tax Credit is a federal tax credit that provides a tax credit for research expenses for companies conducting R&D activity in the United States. 5

7 NYS Amends Economic Development Law 6

8 START-UP NY Tax Free Communities All SUNY colleges and select CUNY and private universities will be able to participate. Businesses must align with mission of university. Must have net new jobs. ZERO NY taxes for 10 years. Both owners and employees benefit! 7

9 START-UP NY Tax Free Communities Businesses must be: A new start up company. A company from out of state relocating to NYS. An expansion of an existing NYS company. 8

10 New York State Excelsior Jobs Program Firms in the Excelsior Jobs Program may qualify for four new, fully refundable tax credits. Businesses claim the credits over a 10 year period. To earn any of the following credits, firms must first meet and maintain established job and investment thresholds based on various industry categories: The Excelsior Jobs Tax Credit The Excelsior Investment Tax Credit The Excelsior Research and Development Tax Credit The Excelsior Real Property Tax Credit 9

11 New York State Excelsior Jobs Program Program Purpose Tax credits are available for strategic businesses such as high tech, bio-tech, clean-tech and manufacturing that create jobs or make significant capital investments. Eligibility The following strategic businesses located in or planning to locate in NYS that will create jobs or retain jobs and make significant capital investments. Scientific Research and Development firms creating at least 5 net new jobs. Software Development firms creating at least 5 net new jobs. Agriculture firms creating at least 5 new jobs. Manufacturing firms creating at least 10 net new jobs. Financial services customer service back office operations creating at least 50 net new jobs. Back office firms creating at least 50 net new jobs. Distribution firms creating at least 75 net new jobs. Other firms creating at least 300 net new jobs and investing at least $6 million. 10

12 New York State Excelsior Jobs Program The Excelsior Jobs Tax Credit: A credit of 6.85% of wages per new job to cover a portion of the associated payroll cost. The Excelsior Investment Tax Credit: Valued at 2% of qualified investments. The Excelsior Research and Development Tax Credit: A credit of 50% of the Federal Research and Development credit up to 3% of research expenditures in NYS. The Excelsior Real Property Tax Credit: Available to firms locating in certain distressed areas and to firms in targeted industries that meet higher employment and investment thresholds (Regionally Significant Project). 11

13 New York State Empire Zone Program The most powerful economic development program in New York State Tax credits for companies that are hiring or making investments in certain geographic areas Manufacturers and large employment projects can be located anywhere in the state While this program is closed to new applicants, benefits to grandfathered companies can still be maximized. 12

14 New York State Investment Tax Credit A tax credit of 4 or 5% of qualifying investments made in depreciable property and machinery and equipment used in the production process. Credit is doubled for Empire Zone certified businesses. An additional Employment Incentive Tax Credit (EITC) of up to 2.5% of investment is available for 2 years for ITC eligible businesses that increase employment by at least 101%. 13

15 New York State Qualified Emerging Technology Credits New York State offers an employment credit for businesses with R&D expenditures in New York State for 3 years and with annual product sales of $10m or less. Credit is $1,000 per employee over a base period employment number. Credits are refundable and refund claims may be available for open tax years. 14

16 New York State Hire a Vet Program A non-refundable tax credit for hiring qualified veterans (discharged after 9/11/01, not fully employed for previous 6 months), equal to 10% of wages paid in first year of employment, up to a maximum of $5,000 (or 15% and $15,000 for qualified disabled veteran); credit is in tax years 2015 and

17 New York State Minimum Wage Reimbursement Refundable Credit A credit is equal to the number of hours worked by eligible employees for which such employees are paid the New York minimum wage ($8.00 an hour starting January 1, 2014 and $8.75 an hour starting January 1, 2015) multiplied by the applicable tax credit rate. The credit is available for tax years beginning on or after January 1, 2014, and before January 1, The credit is 75 cents per hour for 2014, $1.31 per hour for 2015 and $1.35 per hour for 2016 and An eligible employee is an employee who is: Employed by an eligible employer in New York State; Paid at the minimum wage rate exactly, as defined in Article 19 of the Labor Law, during some part of the taxable year by the eligible employer; At least 16 but not yet 20 years of age; and A student during the period he or she is paid at the New York minimum wage rate by the eligible employer. 15

18 New York State Industrial Development Agency IDA can provide: Reduced real property taxes in the form of a PILOT Mortgage recording Tax Exemption Sales Tax Exemption on building construction and remediation Low cost financing through tax exempt bonds. Always consider when buying or rehabilitating property and project costs are at least $2 Million. 16

19 New York State Recharge New York Program Statewide low-cost electric power program designed to retain and create jobs. The program is available to all business and non-profit organizations, other than retailers, sports venues, gaming or entertainment-related establishments and places of overnight accommodation. Power savings is about 15% off of a company s electric bill. 18

20 Questions?