A7608A-2011 Actions

• Jul 11, 2011: enacting clause stricken
• May 25, 2011: print number 7608a
• May 25, 2011: amend and recommit to ways and means
• May 11, 2011: referred to ways and means

A7608A-2011 Text

 S T A T E   O F   N E W   Y O R K
 
 7608--A
 2011-2012 Regular Sessions
 I N  ASSEMBLY
 May 11, 2011
 
 Introduced by M. of A. BING, COOK, WEPRIN -- Multi-Sponsored by -- M. of
 A.  P. RIVERA,  SCHIMMINGER -- read once and referred to the Committee
 on Ways and Means  --  committee  discharged,  bill  amended,  ordered
 reprinted as amended and recommitted to said committee
 

AN ACT to amend the tax law, in relation to an investment tax credit
 

THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM
 BLY, DO ENACT AS FOLLOWS:

 

Section 1. Subparagraph (i) of paragraph  (b)  of  subdivision  12  of
 section  210  of  the  tax law, as amended by chapter 637 of the laws of
 2008, is amended to read as follows:

 (i) A credit shall be allowed under this subdivision with  respect  to
 tangible personal property and other tangible property, including build
 ings  and  structural  components  of  buildings, which are: depreciable
 pursuant to section one hundred sixty-seven  of  the  [internal  revenue
 code]  INTERNAL  REVENUE CODE, have a useful life of four years or more,
 are acquired by purchase as defined in section one hundred  seventy-nine
 (d)  of  the [internal revenue code] INTERNAL REVENUE CODE, have a situs
 in this state and are (A)  principally  used  by  the  taxpayer  in  the
 production  of goods by manufacturing, processing, assembling, refining,
 mining, extracting, farming,  agriculture,  horticulture,  floriculture,
 viticulture or commercial fishing, (B) industrial waste treatment facil
 ities  or air pollution control facilities, used in the taxpayer's trade
 or business, (C) research and development property, (D) principally used
 in the ordinary course of the taxpayer's trade or business as  a  broker
 or  dealer  in connection with the purchase or sale (which shall include
 but not be limited to the issuance, entering into,  assumption,  offset,
 assignment,  termination, or transfer) of stocks, bonds or other securi
 ties as defined in section  four  hundred  seventy-five  (c)(2)  of  the
 Internal  Revenue  Code,  or  of  commodities as defined in section four
 hundred seventy-five (e) of the Internal Revenue Code,  (E)  principally
 used  in  the  ordinary  course  of  the taxpayer's trade or business of
 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
 [ ] is old law to be omitted.
 LBD10881-02-1
 
       A. 7608--A                          2
 providing investment advisory services for a regulated investment compa
 ny as defined in section eight hundred fifty-one of the Internal Revenue
 Code, or lending, loan  arrangement  or  loan  origination  services  to
 customers  in  connection with the purchase or sale (which shall include
 but not be limited to the issuance, entering into,  assumption,  offset,
 assignment,  termination,  or  transfer)  of  securities  as  defined in
 section four hundred seventy-five (c)(2) of the Internal  Revenue  Code,
 (E-1) PRINCIPALLY USED IN THE ORDINARY COURSE OF THE TAXPAYER'S TRADE OR
 BUSINESS  OF  PROVIDING  INVESTMENT ADVISORY SERVICES, OR THE SERVICE OF
 MANAGING INVESTMENT PORTFOLIOS TO ACHIEVE SPECIFIC INVESTMENT OBJECTIVES
 FOR ACCOUNTS OVER ONE MILLION DOLLARS OF ACCREDITED INVESTORS  (AS  THAT
 TERM  IS DEFINED IN RULE FIVE HUNDRED ONE OF REGULATION D OF THE SECURI
 TIES ACT OF 1933), IF THE TAXPAYER SATISFIES THE FOLLOWING CRITERIA: (I)
 THE TAXPAYER IS A REGULATED BROKER OR DEALER OR AN AFFILIATE OF A  REGU
 LATED BROKER OR DEALER, (II) THE TAXPAYER IS REGISTERED AS AN INVESTMENT
 ADVISER UNDER SECTION TWO HUNDRED THREE OF THE INVESTMENT ADVISER ACT OF
 1940,  AS  AMENDED,  AND  (III) AT LEAST ONE CLIENT OF THE TAXPAYER IS A
 REGULATED INVESTMENT COMPANY AS DEFINED IN SECTION EIGHT HUNDRED  FIFTY
 ONE  OF  THE  INTERNAL  REVENUE  CODE  THAT  HAS ASSETS IN EXCESS OF ONE
 HUNDRED MILLION DOLLARS, (F) principally used in the ordinary course  of
 the  taxpayer's business as an exchange registered as a national securi
 ties exchange within the meaning of sections 3(a)(1)  and  6(a)  of  the
 Securities  Exchange  Act  of  1934  or  a  board of trade as defined in
 section 1410(a)(1) of the New York Not-for-Profit Corporation Law or  as
 an  entity  that is wholly owned by one or more such national securities
 exchanges or boards of trade and that provides automation  or  technical
 services thereto, or (G) principally used as a qualified film production
 facility  including  qualified film production facilities having a situs
 in an empire zone designated as such pursuant to article  eighteen-B  of
 the general municipal law, where the taxpayer is providing three or more
 services  to  any  qualified film production company using the facility,
 including such services as a studio lighting  grid,  lighting  and  grip
 equipment,  multi-line  phone  service, broadband information technology
 access, industrial scale electrical capacity,  food  services,  security
 services, and heating, ventilation and air conditioning. For purposes of
 clauses (D), (E), (E-1) and (F) of this subparagraph, property purchased
 by  a  taxpayer  affiliated  with a regulated broker, dealer, registered
 investment adviser, national securities exchange or board of  trade,  is
 allowed  a  credit under this subdivision if the property is used by its
 affiliated regulated  broker,  dealer,  registered  investment  adviser,
 national  securities  exchange or board of trade in accordance with this
 subdivision. For purposes of determining if the property is  principally
 used  in  qualifying uses, the uses by the taxpayer described in clauses
 (D) [and], (E), AND (E-1) of this subparagraph  may  be  aggregated.  In
 addition,  the  uses  by  the taxpayer, its affiliated regulated broker,
 dealer, and registered investment adviser under [either or both] ANY  of
 those  clauses  may be aggregated.   Provided, however, a taxpayer shall
 not be allowed the credit provided by clauses (D), (E), (E-1) and (F) of
 this subparagraph unless (I) eighty percent or  more  of  the  employees
 performing  the  administrative  and support functions resulting from or
 related to the qualifying uses of such equipment  are  located  in  this
 state  or (II) the average number of employees that perform the adminis
 trative and support functions resulting from or related to the  qualify
 ing  uses  of  such  equipment  and are located in this state during the
 taxable year for which the credit is claimed is equal to or greater than
 ninety-five percent of the average  number  of  employees  that  perform
 
       A. 7608--A                          3
 these  functions  and  are  located  in this state during the thirty-six
 months immediately preceding the year for which the credit  is  claimed,
 or  (III) the number of employees located in this state during the taxa
 ble  year  for  which  the credit is claimed is equal to or greater than
 ninety percent of the number of  employees  located  in  this  state  on
 December thirty-first, nineteen hundred ninety-eight or, if the taxpayer
 was  not  a calendar year taxpayer in nineteen hundred ninety-eight, the
 last day of its first taxable year ending after  December  thirty-first,
 nineteen hundred ninety-eight. If the taxpayer becomes subject to tax in
 this  state after the taxable year beginning in nineteen hundred ninety
 eight, then the taxpayer is not required to satisfy the employment  test
 provided  in  the  preceding sentence of this subparagraph for its first
 taxable year. For purposes of clause  (III)  of  this  subparagraph  the
 employment test will be based on the number of employees located in this
 state  on the last day of the first taxable year the taxpayer is subject
 to tax in this state. If the uses of the property must be aggregated  to
 determine  whether  the property is principally used in qualifying uses,
 then either each affiliate using the property must satisfy this  employ
 ment  test  or this employment test must be satisfied through the aggre
 gation of the  employees  of  the  taxpayer,  its  affiliated  regulated
 broker,  dealer,  and  registered investment adviser using the property.
 For purposes of this subdivision, the term  "goods"  shall  not  include
 electricity.
 

S  2. Subparagraph (A) of paragraph 2 of subsection (a) of section 606
 of the tax law, as amended by chapter  637  of  the  laws  of  2008,  is
 amended to read as follows:

 (A)  A  credit  shall be allowed under this subsection with respect to
 tangible personal property and other tangible property, including build
 ings and structural components  of  buildings,  which  are:  depreciable
 pursuant  to  section  one  hundred sixty-seven of the [internal revenue
 code] INTERNAL REVENUE CODE, have a useful life of four years  or  more,
 are  acquired by purchase as defined in section one hundred seventy-nine
 (d) of the [internal revenue code] INTERNAL REVENUE CODE, have  a  situs
 in  this  state  and  are  (i)  principally  used by the taxpayer in the
 production of goods by manufacturing, processing, assembling,  refining,
 mining,  extracting,  farming,  agriculture, horticulture, floriculture,
 viticulture or  commercial  fishing,  (ii)  industrial  waste  treatment
 facilities  or  air pollution control facilities, used in the taxpayer's
 trade or business, (iii) research and development property, (iv) princi
 pally used in the ordinary course of the taxpayer's trade or business as
 a broker or dealer in connection with the purchase or sale (which  shall
 include  but  not be limited to the issuance, entering into, assumption,
 offset, assignment, termination, or transfer) of stocks, bonds or  other
 securities as defined in section four hundred seventy-five (c)(2) of the
 Internal Revenue Code, or of commodities as defined in section 475(e) of
 the  Internal  Revenue Code, (v) principally used in the ordinary course
 of the taxpayer's trade or business  of  providing  investment  advisory
 services  for a regulated investment company as defined in section eight
 hundred fifty-one  of  the  Internal  Revenue  Code,  or  lending,  loan
 arrangement or loan origination services to customers in connection with
 the  purchase  or  sale  (which  shall include but not be limited to the
 issuance, entering into, assumption, offset, assignment, termination, or
 transfer) of securities as defined in section four hundred  seventy-five
 (c)(2)  of  the Internal Revenue Code, [or] (vi) PRINCIPALLY USED IN THE
 ORDINARY COURSE OF THE TAXPAYER'S TRADE OR BUSINESS OF PROVIDING INVEST
 MENT ADVISORY SERVICES, OR THE SERVICE OF MANAGING INVESTMENT PORTFOLIOS
 
       A. 7608--A                          4
 TO ACHIEVE SPECIFIC INVESTMENT OBJECTIVES FOR ACCOUNTS OVER ONE  MILLION
 DOLLARS  OF  ACCREDITED  INVESTORS (AS THAT TERM IS DEFINED IN RULE FIVE
 HUNDRED ONE OF REGULATION D OF THE  SECURITIES  ACT  OF  1933),  IF  THE
 TAXPAYER  SATISFIES  THE FOLLOWING CRITERIA: (I) THE TAXPAYER IS A REGU
 LATED BROKER OR DEALER OR AN AFFILIATE OF A REGULATED BROKER OR  DEALER,
 (II)  THE  TAXPAYER IS REGISTERED AS AN INVESTMENT ADVISOR UNDER SECTION
 TWO HUNDRED THREE OF THE INVESTMENT ADVISER ACT OF 1940, AS AMENDED, AND
 (III) AT LEAST ONE CLIENT OF THE  TAXPAYER  IS  A  REGULATED  INVESTMENT
 COMPANY  AS  DEFINED  IN SECTION EIGHT HUNDRED FIFTY-ONE OF THE INTERNAL
 REVENUE CODE THAT HAS ASSETS IN EXCESS OF ONE HUNDRED  MILLION  DOLLARS,
 OR  (VII)  principally  used  as  a  qualified  film production facility
 including qualified film production facilities  having  a  situs  in  an
 empire  zone  designated  as  such pursuant to article eighteen-B of the
 general municipal law, where the taxpayer is  providing  three  or  more
 services  to  any  qualified film production company using the facility,
 including such services as a studio lighting  grid,  lighting  and  grip
 equipment,  multi-line  phone  service, broadband information technology
 access, industrial scale electrical capacity,  food  services,  security
 services, and heating, ventilation and air conditioning. For purposes of
 clauses  (iv)  [and],  (v)  AND  (VI)  of  this  subparagraph,  property
 purchased by a taxpayer affiliated with a regulated broker,  dealer,  or
 registered  investment adviser is allowed a credit under this subsection
 if the property is used by its affiliated regulated  broker,  dealer  or
 registered  investment  adviser  in accordance with this subsection. For
 purposes of determining if the property is principally used in  qualify
 ing  uses, the uses by the taxpayer described in clauses (iv) and (v) of
 this subparagraph may be  aggregated.  In  addition,  the  uses  by  the
 taxpayer, its affiliated regulated broker, dealer and registered invest
 ment  adviser  under  either or both of those clauses may be aggregated.
 Provided, however, a taxpayer shall not be allowed the  credit  provided
 by  clauses  (iv)  [and],  (v)  AND (VI) of this subparagraph unless (I)
 eighty percent or more of the employees  performing  the  administrative
 and  support  functions resulting from or related to the qualifying uses
 of such equipment are located in this state, or (II) the average  number
 of  employees  that  perform  the  administrative  and support functions
 resulting from or related to the qualifying uses of such  equipment  and
 are  located  in this state during the taxable year for which the credit
 is claimed is equal to or greater than ninety-five percent of the  aver
 age  number of employees that perform these functions and are located in
 this state during the thirty-six months immediately preceding  the  year
 for  which  the  credit  is  claimed,  or  (III) the number of employees
 located in this state during the taxable year for which  the  credit  is
 claimed  is  equal  to  or  greater than ninety percent of the number of
 employees located in  this  state  on  December  thirty-first,  nineteen
 hundred ninety-eight or, if the taxpayer was not a calendar year taxpay
 er  in  nineteen hundred ninety-eight, the last day of its first taxable
 year ending after December thirty-first, nineteen hundred  ninety-eight.
 If  the  taxpayer becomes subject to tax in this state after the taxable
 year beginning in nineteen hundred ninety-eight, then  the  taxpayer  is
 not  required  to  satisfy the employment test provided in the preceding
 sentence of this subparagraph  for  its  first  taxable  year.  For  the
 purposes  of  clause (III) of this subparagraph the employment test will
 be based on the number of employees located in this state  on  the  last
 day  of  the  first  taxable year the taxpayer is subject to tax in this
 state. If the uses of the  property  must  be  aggregated  to  determine
 whether the property is principally used in qualifying uses, then either
 
       A. 7608--A                          5
 each  affiliate  using the property must satisfy this employment test or
 this employment test must be satisfied through the  aggregation  of  the
 employees  of the taxpayer, its affiliated regulated broker, dealer, and
 registered  investment  adviser using the property. For purposes of this
 subsection, the term "goods" shall not include electricity.
 

S 3. Paragraph 2 of subsection (i) of section 1456 of the tax law,  as
 amended  by  chapter  637  of  the  laws  of 2008, is amended to read as
 follows:

 (2) A credit shall be allowed under this subsection  with  respect  to
 tangible personal property and other tangible property, including build
 ings  and  structural  components  of  buildings, which are: depreciable
 pursuant to section one hundred  sixty-seven  of  the  Internal  Revenue
 Code, have a useful life of four years or more, are acquired by purchase
 as  defined  in  section  one  hundred  seventy-nine (d) of the Internal
 Revenue Code, have a situs in this state and are (A) principally used in
 the ordinary course of the taxpayer's trade or business as a  broker  or
 dealer  in connection with the purchase or sale (which shall include but
 not be limited to  the  issuance,  entering  into,  assumption,  offset,
 assignment,  termination, or transfer) of stocks, bonds or other securi
 ties as defined in section four hundred  seventy-five  (c)  (2)  of  the
 Internal  Revenue  Code,  or  of  commodities as defined in section four
 hundred seventy-five (e) of the Internal Revenue Code, [or] (B)  princi
 pally used in the ordinary course of the taxpayer's trade or business of
 providing investment advisory services for a regulated investment compa
 ny as defined in section eight hundred fifty-one of the Internal Revenue
 Code,  or  lending,  loan  arrangement  or  loan origination services to
 customers in connection with the purchase or sale (which  shall  include
 but  not  be limited to the issuance, entering into, assumption, offset,
 assignment, termination,  or  transfer)  of  securities  as  defined  in
 section  four  hundred seventy-five (c) (2) of the Internal Revenue Code
 OR (C) PRINCIPALLY USED IN THE ORDINARY COURSE OF THE  TAXPAYER'S  TRADE
 OR BUSINESS OF PROVIDING INVESTMENT ADVISORY SERVICES, OR THE SERVICE OF
 MANAGING INVESTMENT PORTFOLIOS TO ACHIEVE SPECIFIC INVESTMENT OBJECTIVES
 FOR  ACCOUNTS  OVER ONE MILLION DOLLARS OF ACCREDITED INVESTORS (AS THAT
 TERM IS DEFINED IN RULE FIVE HUNDRED ONE OF REGULATION D OF THE  SECURI
 TIES  ACT OF OF 1933), IF THE TAXPAYER SATISFIES THE FOLLOWING CRITERIA:

 (I) THE TAXPAYER IS A REGULATED BROKER OR DEALER OR AN  AFFILIATE  OF  A
 REGULATED  BROKER  OR  DEALER,  (II)  THE  TAXPAYER  IS REGISTERED AS AN
 INVESTMENT ADVISER UNDER SECTION TWO HUNDRED  THREE  OF  THE  INVESTMENT
 ADVISER  ACT  OF  1940, AS AMENDED, AND (III) AT LEAST ONE CLIENT OF THE
 TAXPAYER IS A REGULATED INVESTMENT COMPANY AS DEFINED IN  SECTION  EIGHT
 HUNDRED FIFTY-ONE OF THE INTERNAL REVENUE CODE THAT HAS ASSETS IN EXCESS
 OF ONE HUNDRED MILLION DOLLARS. For purposes of subparagraphs (A) [and],
 (B)  AND  (C) of this paragraph, property purchased by a taxpayer affil
 iated with a regulated broker, dealer, or registered investment  adviser
 is allowed a credit under this subsection if the property is used by its
 affiliated regulated broker, dealer, or registered investment adviser in
 accordance  with  this  subsection.  For  purposes of determining if the
 property is principally used in qualifying uses, the uses by the taxpay
 er described in subparagraphs (A) [and], (B) AND (C) of  this  paragraph
 may be aggregated. In addition, the uses by the taxpayer, its affiliated
 regulated  broker, dealer and registered investment adviser under either
 or both of such subparagraphs may be aggregated.
 

S 4. This act shall take effect immediately.

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