Jan., 2012 - NY Credit Expiring: Now Is Time to Claim

Posted by Jeffrey Feingold on 01.19.12

New York State's fully refundable tax credit, the "QETC" program - ended at 12/31/2011 (though can still be claimed for 2011 and earlier years). It appears that some of the components (e.g., the $1K hiring part, and the benefit for investors/investments) will continue, but the $250K per year for up to 4 years $1m maximum refundable aspect of the program - essentially, the R&D part - ended 12/31/2011. NY companies meeting the QETC requirements, can still apply for up to four prior years at the max of $250K per year. The "Excelsior" program, which is a new program now available in NY, has four fully refundable components, but nevertheless is much more limited than the QETC in some key aspects.

PROS (Excelsior): 1) raises $1K hiring credit (in QETC) to $5K, which could be quite significant for growing companies. 2) is NOT limited to small companies like QETC is, and so doesn't have the limits of 100 or fewer employees and less than $10m in product sales, 3) still includes many industries, including sw development, manufacturing, agriculture, high tech, even financial services. 4) has 4 fully refundable components (i.e., the $5K hiring, an investment piece, a property tax piece, and an R&D credit part)

CONS (Excelsior): 1) The R&D credit part - though refundable, as noted - is a mere 10% of a company's Federal R&D credit, on in-state expenditures. 2) much more involved application process (u can submit a simple two page form to NY to see if you can pre-qualify for the QETC).

For more information about the QETC tax credit, call Tax Point Advisors, Inc., at 800-260-4138.

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