Bill Text: NY S02642 | 2017-2018 | General Assembly | Amended
Bill Title: Establishes a credit against income tax for the rehabilitation of distressed residential properties; allows a credit equal to thirty percent of the qualified rehabilitation expenditures made by the taxpayer with respect to a qualified distressed residential property; requires property that qualifies must be constructed prior to January 1, 1962 in a distressed residential or mixed-use neighborhood.
Sponsorship: Partisan Bill (Republican 4)
Status: (Engrossed - Dead) 2018-02-06 - PRINT NUMBER 2642B [S02642 Detail]
Download: New_York-2017-S02642-Amended.html
STATE OF NEW YORK ________________________________________________________________________ 2642--B 2017-2018 Regular Sessions IN SENATE January 13, 2017 ___________ Introduced by Sens. RANZENHOFER, FUNKE, LARKIN, 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 -- recommitted to the Commit- tee on Investigations and Government Operations in accordance with Senate Rule 6, sec. 8 -- reported favorably from said committee and committed to the Committee on Finance -- committee discharged, bill amended, ordered reprinted as amended and recommitted to said commit- tee AN ACT to amend the tax law, in relation to establishing a credit against income tax for the rehabilitation of distressed residential 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 (ccc) to read as follows: 3 (ccc) Credit for rehabilitation of distressed residential 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 residential property. 9 Provided, however, the credit shall not exceed one hundred thousand 10 dollars. 11 (2) Tax credits allowed pursuant to this subsection shall be allowed 12 in the taxable year in which the property is deemed a certified rehabil- 13 itation. EXPLANATION--Matter in italics (underscored) is new; matter in brackets [] is old law to be omitted. LBD06135-04-8S. 2642--B 2 1 (3) If the amount of the credit allowable under this subsection for 2 any taxable year shall exceed the taxpayer's tax for such year, the 3 excess may be carried over to the following year or years, and may be 4 applied against the taxpayer's tax for such year or years. 5 (4) (A) The term "qualified rehabilitation expenditure" means, for 6 purposes of this subsection, any amount properly chargeable to a capital 7 account: 8 (i) in connection with the certified rehabilitation of a qualified 9 distressed residential property, and 10 (ii) for property for which depreciation would be allowable under 11 section 168 of the internal revenue code. 12 (B) Such term shall not include (i) the cost of acquiring any building 13 or interest therein, (ii) any expenditure attributable to the enlarge- 14 ment of an existing building, or (iii) any expenditure made prior to 15 January first, two thousand eighteen or after December thirty-first, two 16 thousand twenty-three. 17 (5) The term "certified rehabilitation" means, for purposes of 18 distressed residential property in this subsection, any rehabilitation 19 of a certified distressed residential property which has been approved 20 and certified by a local government as being completed, with a certif- 21 icate of occupancy issued, and that the costs are consistent with the 22 work completed. Such certification shall be acceptable as proof that the 23 expenditures related to such rehabilitation qualify as qualified reha- 24 bilitation expenditures for purposes of the credit allowed under para- 25 graph one of this subsection. 26 (6) (A) The term "qualified residential property" means, for purposes 27 of this subsection, a distressed residential property located within New 28 York state: 29 (i) which has been substantially rehabilitated, 30 (ii) which was constructed prior to January first, nineteen hundred 31 sixty-two, 32 (iii) which is owned by the taxpayer, and 33 (iv) which is located within a distressed residential or mixed-use 34 area, as identified by each locality through local law, that is deemed 35 an area in need of community renewal due to dilapidation and vacancies. 36 (B) If the distressed residential property is rental property, such 37 property shall have been vacant for at least six months while actively 38 marketed for lease. 39 (C) A building shall be treated as having been "substantially rehabil- 40 itated" if the qualified rehabilitation expenditures in relation to such 41 building total ten thousand dollars or more. 42 (7) (A) If the taxpayer disposes of such taxpayer's interest in the 43 qualified distressed residential property, or such property ceases to be 44 used as a residential property of the taxpayer within five years of 45 receiving the credit under this subsection, the taxpayer's tax imposed 46 by this article for the taxable year in which such disposition or cessa- 47 tion occurs shall be increased by the recapture portion of the credit 48 allowed under this subsection for all prior taxable years with respect 49 to such rehabilitation. 50 (B) For purposes of subparagraph (A) of this paragraph, the recapture 51 portion shall be the product of the amount of credit claimed by the 52 taxpayer multiplied by a ratio, the numerator of which is equal to sixty 53 less the number of months the building is owned or used as residential 54 property by the taxpayer and the denominator of which is sixty.S. 2642--B 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 8 of distressed residential under subdivision fifty-three 9 properties under subsection (ccc) 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 residential properties. 13 (1) 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 residential property. 18 Provided, however, the credit shall not exceed one hundred thousand 19 dollars. 20 (2) Tax credits allowed pursuant to this subdivision shall be allowed 21 in the taxable year in which the property is deemed a certified rehabil- 22 itation. 23 (3) If the amount of the credit allowable under this subdivision for 24 any taxable year shall exceed the taxpayer's tax for such year, the 25 excess may be carried over to the following year or years, and may be 26 applied against the taxpayer's tax for such year or years, but shall not 27 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 residential 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 residential 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 residential property" means, for purposes 49 of this subdivision, a distressed residential property located within 50 New York state: 51 (i) which has been substantially rehabilitated, 52 (ii) which was constructed prior to January first, nineteen hundred 53 sixty-two, 54 (iii) which is owned by the taxpayer, andS. 2642--B 4 1 (iv) which is located within a distressed residential or mixed-use 2 area, as identified by each locality through local law, that is deemed 3 an area in need of community renewal due to dilapidation and vacancies. 4 (B) If the distressed residential property is rental property, such 5 property shall have been vacant for at least six months while actively 6 marketed for lease. 7 (C) A building shall be treated as having been "substantially rehabil- 8 itated" if the qualified rehabilitation expenditures in relation to such 9 building total ten thousand dollars or more. 10 (7) (A) If the taxpayer disposes of such taxpayer's interest in the 11 qualified distressed residential property, or such property ceases to be 12 used as a residential property of the taxpayer within five years of 13 receiving the credit under this subdivision, the taxpayer's tax imposed 14 by this article for the taxable year in which such disposition or cessa- 15 tion occurs shall be increased by the recapture portion of the credit 16 allowed under this subdivision for all prior taxable years with respect 17 to such rehabilitation. 18 (B) For purposes of subparagraph (A) of this paragraph, the recapture 19 portion shall be the product of the amount of credit claimed by the 20 taxpayer multiplied by a ratio, the numerator of which is equal to sixty 21 less the number of months the building is owned or used as residential 22 property by the taxpayer and the denominator of which is sixty. 23 (8) Any expenditure for which a credit is claimed under this subdivi- 24 sion shall not be eligible for any other credit under this chapter. 25 § 4. This act shall take effect immediately and shall apply to taxable 26 years beginning on or after January 1, 2018.
