Bill Text: NY S04905 | 2019-2020 | General Assembly | Introduced
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 4-1)
Status: (Introduced - Dead) 2020-01-08 - REFERRED TO BUDGET AND REVENUE [S04905 Detail]
Download: New_York-2019-S04905-Introduced.html
STATE OF NEW YORK ________________________________________________________________________ 4905 2019-2020 Regular Sessions IN SENATE March 29, 2019 ___________ Introduced by Sens. RANZENHOFER, FELDER, FUNKE, RITCHIE, SERINO -- read twice and ordered printed, and when printed to be committed to the Committee on Budget and Revenue 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 nineteen, 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. 10 (2) Tax credits allowed pursuant to this subsection shall be allowed 11 in the taxable year in which the property is deemed a certified rehabil- 12 itation. 13 (3) If the amount of the credit allowable under this subsection for 14 any taxable year shall exceed the taxpayer's tax for such year, the 15 excess may be carried over to the following year or years, and may be 16 applied against the taxpayer's tax for such year or years provided that 17 the total amount of the credit applied against the taxpayer's tax for a 18 given year shall not exceed twenty-five thousand dollars. 19 (4) (A) The term "qualified rehabilitation expenditure" means, for 20 purposes of this subsection, any amount properly chargeable to a capital 21 account: 22 (i) in connection with the certified rehabilitation of a qualified 23 distressed commercial property, and EXPLANATION--Matter in italics (underscored) is new; matter in brackets [] is old law to be omitted. LBD10859-01-9S. 4905 2 1 (ii) for property for which depreciation would be allowable under 2 section 168 of the internal revenue code. 3 (B) Such term shall not include (i) the cost of acquiring any building 4 or interest therein, (ii) any expenditure attributable to the enlarge- 5 ment of an existing building, or (iii) any expenditure made prior to 6 January first, two thousand nineteen or after December thirty-first, two 7 thousand twenty-four. 8 (5) The term "certified rehabilitation" means, for purposes of this 9 subsection, any rehabilitation of a certified distressed commercial 10 property which has been approved and certified by a local government as 11 being completed, with a certificate of occupancy issued, and that the 12 costs are consistent with the work completed. Such certification shall 13 be acceptable as proof that the expenditures related to such rehabili- 14 tation qualify as qualified rehabilitation expenditures for purposes of 15 the credit allowed under paragraph one of this subsection. 16 (6) (A) The term "qualified distressed commercial property" means, for 17 purposes of this subsection, a distressed commercial property located 18 within New York state: 19 (i) which has been substantially rehabilitated, 20 (ii) which is owned by the taxpayer, and 21 (iii) which is located within a distressed commercial area, as identi- 22 fied by each locality through local law, that is deemed an area in need 23 of community renewal due to dilapidation and vacancies. 24 (B) If the distressed commercial property is rental property, such 25 property shall have been more than thirty percent vacant for twelve 26 months while actively marketed for lease. 27 (C) A building shall be treated as having been "substantially rehabil- 28 itated" if the qualified rehabilitation expenditures in relation to such 29 building total ten thousand dollars or more. 30 (7) (A) If the taxpayer disposes of such taxpayer's interest in the 31 qualified distressed commercial property, or such property ceases to be 32 used as a commercial property of the taxpayer within five years of 33 receiving the credit under this subsection, the taxpayer's tax imposed 34 by this article for the taxable year in which such disposition or cessa- 35 tion occurs shall be increased by the recapture portion of the credit 36 allowed under this subsection for all prior taxable years with respect 37 to such rehabilitation. 38 (B) For purposes of subparagraph (A) of this paragraph, the recapture 39 portion shall be the product of the amount of credit claimed by the 40 taxpayer multiplied by a ratio, the numerator of which is equal to sixty 41 less the number of months the building is owned or used as commercial 42 property by the taxpayer and the denominator of which is sixty. 43 (8) Any expenditure for which a credit is claimed under this 44 subsection shall not be eligible for any other credit under this chap- 45 ter. 46 § 2. Subparagraph (B) of paragraph 1 of subsection (i) of section 606 47 of the tax law is amended by adding a new clause (xliv) to read as 48 follows: 49 (xliv) Credit for rehabilitation Amount of credit under 50 of distressed commercial properties subdivision fifty-three 51 under subsection (jjj) of section two hundred ten-B 52 § 3. Section 210-B of the tax law is amended by adding a new subdivi- 53 sion 53 to read as follows: 54 53. Credit for rehabilitation of distressed commercial properties. (1) 55 For taxable years beginning on or after January first, two thousand 56 nineteen, a taxpayer shall be allowed a credit as hereinafter provided,S. 4905 3 1 against the tax imposed by this article, in an amount equal to thirty 2 percent of the qualified rehabilitation expenditures made by the taxpay- 3 er with respect to a qualified distressed commercial property. Provided, 4 however, the credit shall not exceed one hundred thousand dollars. 5 (2) Tax credits allowed pursuant to this subdivision shall be allowed 6 in the taxable year in which the property is deemed a certified rehabil- 7 itation. 8 (3) If the amount of the credit allowable under this subdivision for 9 any taxable year shall exceed the taxpayer's tax for such year, the 10 excess may be carried over to the following year or years, and may be 11 applied against the taxpayer's tax for such year or years, provided that 12 the total amount of the credit applied against the taxpayer's tax for a 13 given year shall not exceed twenty-five thousand dollars. 14 (4) (A) The term "qualified rehabilitation expenditure" means, for 15 purposes of this subdivision, any amount properly chargeable to a capi- 16 tal account: 17 (i) in connection with the certified rehabilitation of a qualified 18 commercial property, and 19 (ii) for property for which depreciation would be allowable under 20 section 168 of the internal revenue code. 21 (B) Such term shall not include (i) the cost of acquiring any building 22 or interest therein, (ii) any expenditure attributable to the enlarge- 23 ment of an existing building, or (iii) any expenditure made prior to 24 January first, two thousand nineteen or after December thirty-first, two 25 thousand twenty-four. 26 (5) The term "certified rehabilitation" means, for purposes of this 27 subdivision, any rehabilitation of a certified distressed commercial 28 property which has been approved and certified by a local government as 29 being completed, with a certificate of occupancy issued, and that the 30 costs are consistent with the work completed. Such certification shall 31 be acceptable as proof that the expenditures related to such rehabili- 32 tation qualify as qualified rehabilitation expenditures for purposes of 33 the credit allowed under paragraph one of this subdivision. 34 (6) (A) The term "qualified distressed commercial property" means, for 35 purposes of this subdivision, a distressed commercial property located 36 within New York state: 37 (i) which has been substantially rehabilitated, 38 (ii) which is owned by the taxpayer, and 39 (iii) which is located within a distressed commercial area, as identi- 40 fied by each locality through local law, that is deemed an area in need 41 of community renewal due to dilapidation and vacancies. 42 (B) If the distressed commercial property is rental property, such 43 property shall have been more than thirty percent vacant for twelve 44 months while actively marketed for lease. 45 (C) A building shall be treated as having been "substantially rehabil- 46 itated" if the qualified rehabilitation expenditures in relation to such 47 building total ten thousand dollars or more. 48 (7) (A) If the taxpayer disposes of such taxpayer's interest in the 49 qualified distressed commercial property, or such property ceases to be 50 used as a commercial property of the taxpayer within five years of 51 receiving the credit under this subdivision, the taxpayer's tax imposed 52 by this article for the taxable year in which such disposition or cessa- 53 tion occurs shall be increased by the recapture portion of the credit 54 allowed under this subdivision for all prior taxable years with respect 55 to such rehabilitation.S. 4905 4 1 (B) For purposes of subparagraph (A) of this paragraph, the recapture 2 portion shall be the product of the amount of credit claimed by the 3 taxpayer multiplied by a ratio, the numerator of which is equal to sixty 4 less the number of months the building is owned or used as commercial 5 property by the taxpayer and the denominator of which is sixty. 6 (8) Any expenditure for which a credit is claimed under this subdivi- 7 sion shall not be eligible for any other credit under this chapter. 8 § 4. This act shall take effect immediately and shall apply to taxable 9 years beginning on or after January 1, 2019.