Incentives Watch: Tax Credit Highlights From New York’s 2014-2015 Budget Plan

With the enactment of its FY2014-2015 budget, New York made several key changes related to tax credits.  New tax credits were enacted, such as the Musical and Theatrical Production Tax Credit, while existing credits were amended.

Starting with the 2015 tax year, the Musical and Theatrical Production Tax Credit is available for musical and theatrical productions touring in certain parts of the state.  The credit equals 25 percent of production and transportation expenditures for productions in a facility with a seating capacity of at least 1,000 that is not located in New York City.

Speaking of the arts, New York expanded its Empire State Film Production Credit by adding Albany and Schenectady counties to the list of areas where taxpayers may qualify for the wage credit.  The wage credit equals 10 percent of wages paid to certain individuals employed by a qualified film production company or a qualified independent film production company for services performed by those individuals in certain counties in connection with a film having a minimum budget of $500,000. 

New York also enacted a real property tax credit for manufacturers, which is equal to 20 percent of the real property taxes paid on owned or leased property principally used during the taxable year for manufacturing.  The credit is refundable for individual income tax purposes.

Businesses taking advantage of the START-UP NY Program will be happy to know that they can now take advantage of another tax incentive:  a telecommunication services excise tax credit.  This credit is in addition to the other incentives available through the program such as a refundable tax elimination credit against franchise tax and personal income tax, an organization tax exemption, a maintenance and license fee exemption, a metropolitan commuter transportation district mobility tax exemption, a real estate transfer tax exemption, and sales and use tax incentives.

In addition, New York established a tax credit for employers hiring individuals with developmental disabilities.  The so-called Workers with Disabilities Tax Credit equals 15 percent of wages paid to full-time employees (10 percent for part-time employees).

Other tax credit highlights include:

-The commercial production tax credit received a two-year extension and now expires Dec. 31, 2016.

-The low-income housing tax credit cap is increased to $56 million, starting March 31, 2014.

For more information about other New York tax credits and incentives, check out Bloomberg BNA’s Credits and Incentives Portfolios by signing up for a free trial of the Bloomberg BNA Premier State Tax Library today.

In other developments . . .

Kentucky expanded its historic rehabilitation tax credit program to allow larger projects with rehabilitation expenses exceeding $15 million to qualify for the expanded credit, which is not subject to a cap, according to a Bloomberg BNA Weekly State Tax Reportarticle.

By: Kathleen Caggiano

Follow Kathleen on Twitter at:  @katcaggiano .

Follow BBNA on Twitter at: @BBNATax .