Find Out If Your Business Qualifies for New York Pandemic Tax Credits Before They Are Gone

As we previously informed you, included within New York’s 2023 fiscal year budget is a new refundable tax relief program for pandemic-related expenditures by certain businesses. The $250 million COVID-19 Capital Costs Tax Credit Program is aimed at supporting businesses that made investments to comply with emergency orders and regulations to increase public safety in response to the COVID-19 outbreak.

The program provides tax credits covering 50% of eligible costs, up to $50,000, for a maximum tax credit award of $25,000 per eligible applicant. Such credits will be awarded on a first-come, first-served basis until the program’s funds are depleted. To be eligible a business must:

• Operate a location in New York;
• Have 100 or fewer employees;
• Have $2.5 million or less of gross receipts in the 2021 tax year; and
• At least $2,000 in eligible costs incurred between January 1, 2021 and December 31, 2022.

Pandemic-related expenditures that are eligible for the credit include, but are not limited to:

• Supplies to disinfect or protect against virus transmission;
• Costs associated with expanding or defining space to accommodate social distancing;
• HVAC equipment;
• Expenses related to increased outdoor activity and outdoor space expansions; and
• Machinery and equipment to facilitate contactless sales.

Businesses seeking to apply for the credit program are encouraged to complete the newly released Empire State Development (ESD) COVID-19 Capital Cost Tax Credit screening tool as soon as possible. If deemed eligible by the screening tool, a link to the application will be provided when the program application opens. The ESD is overseeing the program and will be issuing the tax credit certificates on a rolling basis.

If you have questions about your business’ eligibility for the COVID-19 Capital Cost Tax Credit Program or to determine which expenses you incurred qualify for the credit, please contact Alan Goldenberg, Principal and Leader of the State and Local Taxation and Tax Controversy groups, or your Anchin Relationship Partner.