Bill Text: NY S02643 | 2017-2018 | General Assembly | Amended
Bill Title: Establishes a credit against income tax for the rehabilitation of distressed commercial properties; allows for 30% of the qualified rehabilitation expenditures up to $100,000; requires that to be eligible, the commercial property is located within a distressed commercial area, as identified by each locality through local law, that is deemed an area in need of community renewal due to dilapidation and vacancies; provides that the property which has been substantially rehabilitated is where the qualified rehabilitation expenditures in relation to such building total ten thousand dollars or more.
Spectrum: Moderate Partisan Bill (Republican 5-1)
Status: (Engrossed - Dead) 2018-06-20 - COMMITTED TO RULES [S02643 Detail]
Download: New_York-2017-S02643-Amended.html
STATE OF NEW YORK ________________________________________________________________________ 2643--C Cal. No. 1338 2017-2018 Regular Sessions IN SENATE January 13, 2017 ___________ Introduced by Sens. RANZENHOFER, FELDER, FUNKE, LARKIN, RITCHIE, SERINO -- read twice and ordered printed, and when printed to be committed to the Committee on Investigations and Government Operations -- 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 -- recom- mitted 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 commit- tee -- reported favorably from said committee and committed to the Committee on Finance -- reported favorably from said committee, ordered to first report, amended on first report, ordered to a second report and ordered reprinted, retaining its place in the order of second report AN ACT to amend the tax law, in relation to establishing a credit against income tax for the rehabilitation of distressed commercial properties The People of the State of New York, represented in Senate and Assem- bly, do enact as follows: 1 Section 1. Section 606 of the tax law is amended by adding a new 2 subsection (jjj) to read as follows: 3 (jjj) Credit for rehabilitation of distressed commercial properties. 4 (1) For taxable years beginning on or after January first, two thousand 5 eighteen, a taxpayer shall be allowed a credit as hereinafter provided, 6 against the tax imposed by this article, in an amount equal to thirty 7 percent of the qualified rehabilitation expenditures made by the taxpay- 8 er with respect to a qualified distressed commercial property. Provided, 9 however, the credit shall not exceed one hundred thousand dollars. EXPLANATION--Matter in italics (underscored) is new; matter in brackets [] is old law to be omitted. LBD06136-06-8S. 2643--C 2 1 (2) Tax credits allowed pursuant to this subsection shall be allowed 2 in the taxable year in which the property is deemed a certified rehabil- 3 itation. 4 (3) If the amount of the credit allowable under this subsection for 5 any taxable year shall exceed the taxpayer's tax for such year, the 6 excess may be carried over to the following year or years, and may be 7 applied against the taxpayer's tax for such year or years provided that 8 the total amount of the credit applied against the taxpayer's tax for a 9 given year shall not exceed twenty-five thousand dollars. 10 (4) (A) The term "qualified rehabilitation expenditure" means, for 11 purposes of this subsection, any amount properly chargeable to a capital 12 account: 13 (i) in connection with the certified rehabilitation of a qualified 14 distressed commercial property, and 15 (ii) for property for which depreciation would be allowable under 16 section 168 of the internal revenue code. 17 (B) Such term shall not include (i) the cost of acquiring any building 18 or interest therein, (ii) any expenditure attributable to the enlarge- 19 ment of an existing building, or (iii) any expenditure made prior to 20 January first, two thousand eighteen or after December thirty-first, two 21 thousand twenty-three. 22 (5) The term "certified rehabilitation" means, for purposes of this 23 subsection, any rehabilitation of a certified distressed commercial 24 property which has been approved and certified by a local government as 25 being completed, with a certificate of occupancy issued, and that the 26 costs are consistent with the work completed. Such certification shall 27 be acceptable as proof that the expenditures related to such rehabili- 28 tation qualify as qualified rehabilitation expenditures for purposes of 29 the credit allowed under paragraph one of this subsection. 30 (6) (A) The term "qualified distressed commercial property" means, for 31 purposes of this subsection, a distressed commercial property located 32 within New York state: 33 (i) which has been substantially rehabilitated, 34 (ii) which is owned by the taxpayer, and 35 (iii) which is located within a distressed commercial area, as identi- 36 fied by each locality through local law, that is deemed an area in need 37 of community renewal due to dilapidation and vacancies. 38 (B) If the distressed commercial property is rental property, such 39 property shall have been more than thirty percent vacant for twelve 40 months while actively marketed for lease. 41 (C) A building shall be treated as having been "substantially rehabil- 42 itated" if the qualified rehabilitation expenditures in relation to such 43 building total ten thousand dollars or more. 44 (7) (A) If the taxpayer disposes of such taxpayer's interest in the 45 qualified distressed commercial property, or such property ceases to be 46 used as a commercial property of the taxpayer within five years of 47 receiving the credit under this subsection, the taxpayer's tax imposed 48 by this article for the taxable year in which such disposition or cessa- 49 tion occurs shall be increased by the recapture portion of the credit 50 allowed under this subsection for all prior taxable years with respect 51 to such rehabilitation. 52 (B) For purposes of subparagraph (A) of this paragraph, the recapture 53 portion shall be the product of the amount of credit claimed by the 54 taxpayer multiplied by a ratio, the numerator of which is equal to sixty 55 less the number of months the building is owned or used as commercial 56 property by the taxpayer and the denominator of which is sixty.S. 2643--C 3 1 (8) Any expenditure for which a credit is claimed under this 2 subsection shall not be eligible for any other credit under this chap- 3 ter. 4 § 2. Subparagraph (B) of paragraph 1 of subsection (i) of section 606 5 of the tax law is amended by adding a new clause (xliv) to read as 6 follows: 7 (xliv) Credit for rehabilitation Amount of credit under 8 of distressed commercial properties subdivision fifty-three 9 under subsection (jjj) of section two hundred ten-B 10 § 3. Section 210-B of the tax law is amended by adding a new subdivi- 11 sion 53 to read as follows: 12 53. Credit for rehabilitation of distressed commercial properties. (1) 13 For taxable years beginning on or after January first, two thousand 14 eighteen, a taxpayer shall be allowed a credit as hereinafter provided, 15 against the tax imposed by this article, in an amount equal to thirty 16 percent of the qualified rehabilitation expenditures made by the taxpay- 17 er with respect to a qualified distressed commercial property. Provided, 18 however, the credit shall not exceed one hundred thousand dollars. 19 (2) Tax credits allowed pursuant to this subdivision shall be allowed 20 in the taxable year in which the property is deemed a certified rehabil- 21 itation. 22 (3) If the amount of the credit allowable under this subdivision for 23 any taxable year shall exceed the taxpayer's tax for such year, the 24 excess may be carried over to the following year or years, and may be 25 applied against the taxpayer's tax for such year or years, provided that 26 the total amount of the credit applied against the taxpayer's tax for a 27 given year shall not exceed twenty-five thousand dollars. 28 (4) (A) The term "qualified rehabilitation expenditure" means, for 29 purposes of this subdivision, any amount properly chargeable to a capi- 30 tal account: 31 (i) in connection with the certified rehabilitation of a qualified 32 commercial property, and 33 (ii) for property for which depreciation would be allowable under 34 section 168 of the internal revenue code. 35 (B) Such term shall not include (i) the cost of acquiring any building 36 or interest therein, (ii) any expenditure attributable to the enlarge- 37 ment of an existing building, or (iii) any expenditure made prior to 38 January first, two thousand eighteen or after December thirty-first, two 39 thousand twenty-three. 40 (5) The term "certified rehabilitation" means, for purposes of this 41 subdivision, any rehabilitation of a certified distressed commercial 42 property which has been approved and certified by a local government as 43 being completed, with a certificate of occupancy issued, and that the 44 costs are consistent with the work completed. Such certification shall 45 be acceptable as proof that the expenditures related to such rehabili- 46 tation qualify as qualified rehabilitation expenditures for purposes of 47 the credit allowed under paragraph one of this subdivision. 48 (6) (A) The term "qualified distressed commercial property" means, for 49 purposes of this subdivision, a distressed commercial property located 50 within New York state: 51 (i) which has been substantially rehabilitated, 52 (ii) which is owned by the taxpayer, and 53 (iii) which is located within a distressed commercial area, as identi- 54 fied by each locality through local law, that is deemed an area in need 55 of community renewal due to dilapidation and vacancies.S. 2643--C 4 1 (B) If the distressed commercial property is rental property, such 2 property shall have been more than thirty percent vacant for twelve 3 months while actively marketed for lease. 4 (C) A building shall be treated as having been "substantially rehabil- 5 itated" if the qualified rehabilitation expenditures in relation to such 6 building total ten thousand dollars or more. 7 (7) (A) If the taxpayer disposes of such taxpayer's interest in the 8 qualified distressed commercial property, or such property ceases to be 9 used as a commercial property of the taxpayer within five years of 10 receiving the credit under this subdivision, the taxpayer's tax imposed 11 by this article for the taxable year in which such disposition or cessa- 12 tion occurs shall be increased by the recapture portion of the credit 13 allowed under this subdivision for all prior taxable years with respect 14 to such rehabilitation. 15 (B) For purposes of subparagraph (A) of this paragraph, the recapture 16 portion shall be the product of the amount of credit claimed by the 17 taxpayer multiplied by a ratio, the numerator of which is equal to sixty 18 less the number of months the building is owned or used as commercial 19 property by the taxpayer and the denominator of which is sixty. 20 (8) Any expenditure for which a credit is claimed under this subdivi- 21 sion shall not be eligible for any other credit under this chapter. 22 § 4. This act shall take effect immediately and shall apply to taxable 23 years beginning on or after January 1, 2018.
