New York State Tax Law

Article 22 - Personal Income Tax Part 1

§ 606 - Credits against Tax

(j) Empire Zone Investment Tax Credit

(1) A taxpayer shall be allowed a credit, to be computed as hereinafter provided, against the tax imposed by this article where the taxpayer has been certified pursuant to article eighteen-B of the general municipal law. The amount of such credit shall be eight percent of the cost or other basis for federal income tax purposes of tangible personal property and other tangible property, including buildings and structural components of buildings, described in paragraph two of this subsection, which is located within an empire zone designated as such pursuant to article eighteen-B of such law, but only if the acquisition, construction, reconstruction or erection of such property occurred or was commenced on or after the date of such designation and prior to the expiration thereof. Provided, however, that in the case of an acquisition, construction, reconstruction or erection which was commenced during such period and continued or completed subsequently, the credit shall be eight percent of the portion of the cost or other basis for federal income tax purposes attributable to such period, which portion shall be ascertained by multiplying such cost or basis by a fraction the numerator of which shall be the expenditures paid or incurred during such period for such purposes and the denominator of which shall be the total of all expenditures paid or incurred for such acquisition, construction, reconstruction or erection.

* (2) A credit shall be allowed under this subsection with respect to tangible personal property and other tangible property, including buildings  and structural components of buildings which: (A) are depreciable pursuant to section one hundred sixty-seven of the internal revenue code, (B) have a useful life of four years or more, (C) are acquired by purchase as defined in section one hundred seventy-nine (d) of the internal revenue code, (D) have a situs in an empire zone designated as such pursuant to article eighteen-B of the general municipal law, and (E) 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) 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  securities 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 (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. For purposes of clauses (iv) and (v) of this subparagraph, property purchased by a taxpayer affiliated with a regulated broker or dealer is allowed a credit under this subsection if the property is used by its affiliated regulated broker or dealer in accordance with this subsection. Provided, however, a taxpayer shall not be allowed the credit provided by clauses (iv) and (v) of this subparagraph unless all or a substantial portion 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. For purposes of this subsection, the term "goods" shall not include electricity. For purposes of this paragraph, manufacturing shall mean the process of working raw materials into wares suitable for use or which gives new shapes, new quality or new combination to matter which already has gone through some artificial process by the use of machinery, tools, appliances and other similar equipment. Property used in the production of goods shall include machinery, equipment or other tangible property which is principally used in the repair and service of other machinery, equipment or other tangible property used principally in the production of goods and shall include all facilities used in the production operation, including storage of material to be used in production and of the products that are produced. For purposes of this paragraph, the terms "research and development property", "industrial waste treatment facilities", and "air pollution control facilities" shall have the meanings ascribed thereto by clauses (ii), (iii) and (iv), respectively, of subparagraph (B) of paragraph two of subsection (a) of this section, and the provisions of subparagraph (C) of such paragraph two shall apply.

  * NB Applies to property to which the amendments made by section 201 of Public Law 99-514 apply

(3) A taxpayer shall not be allowed a credit under this subsection with respect to any tangible personal property and other tangible property, including buildings and structural components of buildings, which it leases to any other person or corporation except where a taxpayer leases property to an affiliated regulated broker or dealer that uses such property in accordance with clause (iv) or (v) of subparagraph (E) of paragraph two of this subsection. For purposes of the preceding sentence, any contract or agreement to lease or rent or for a license to use such property shall be considered a lease. Provided, however, in determining whether a taxpayer shall be allowed a credit under this subsection with respect to such property, any election made with respect to such property pursuant to the provisions of paragraph eight of subsection (f) of section one hundred sixty-eight of the internal revenue code, as such paragraph was in effect for agreements entered into prior to January first, nineteen hundred eighty-four, shall be disregarded.

(4) If the amount of credit allowed under this subsection for any taxable year shall exceed the taxpayer's tax for such year, the excess may be carried over to the following year or years and may be deducted from the taxpayer's tax for such year or years. In lieu of carrying over any such excess, a taxpayer who qualifies as an owner of a new business for purposes of paragraph ten of subsection (a) of this section may, at his option, receive fifty percent of such excess as a refund. Any refund paid pursuant to this paragraph shall be deemed to be a refund of an overpayment of tax as provided in section six hundred eighty-six of this article, provided, however, that no interest shall be paid thereon.

(5) At the option of the taxpayer, air or water pollution control facilities which qualify for elective modifications under subsection (h) of section six hundred twelve, or research and development facilities which qualify for elective modification under paragraphs three and four of subsection (g) of section six hundred twelve, or property which qualifies for the credit provided under subsection (a) or (h) of this section may be treated as property principally used by the taxpayer in the production of goods by manufacturing, processing, assembling, mining, refining, extracting, farming,  agriculture,  horticulture, floriculture, viticulture, or commercial fishing, provided the property otherwise qualifies under paragraph two of this subsection, in which event a deduction shall not be allowed under such subsection (h) or such paragraphs three and four of subsection (g) and a credit shall not be allowed under such subsection (a) or (h).

* (6) (A) With respect to property which is depreciable pursuant to section one hundred sixty-seven of the internal revenue code but is not subject to the provisions of section one hundred sixty-eight of such code and which is disposed of or ceases to be in qualified use prior to the end of the taxable year in which the credit is to be taken, the amount of the credit shall be that portion of the credit provided for in this section which represents the ratio which the months of qualified use bear to the months of useful life. If the property on which credit has been taken is disposed of or ceases to be in qualified use prior to the end of its useful life, the difference between the credit taken and the credit allowed for actual use must be added back in the year of disposition. Provided, however, if such property is disposed of or ceases to be in qualified use after it has been in qualified use for more than twelve consecutive years, it shall not be necessary to add back the credit as provided in this subsection. The amount of credit allowed for actual use shall be determined by multiplying the original credit by the ratio which the months of qualified use bear to the months of useful life. For purposes of this subsection, useful life of property shall be the same as the taxpayer uses for depreciation purposes when computing his federal income tax liability.

     (B) Except with respect to that property to which subparagraph (D) of this paragraph applies, with respect to three-year property, as defined in subsection (e) of section one hundred sixty-eight of the internal revenue code, which is disposed of or ceases to be in qualified use prior to the end of the taxable year in which the credit is to be taken, the amount of the credit shall be that portion of the credit provided for in this subsection which represents the ratio which the months of qualified use bear to thirty-six. If property on which credit has been taken is disposed of or ceases to be in qualified use prior to the end of thirty-six months, the difference between the credit taken and the credit allowed for actual use must be added back in the year of disposition. The amount of credit allowed for actual use shall be determined by multiplying the original credit by the ratio which the months of qualified use bear to thirty-six.

     (C) Except with respect to that property to which subparagraph (D) of this paragraph applies, with respect to property subject to the provisions of section one hundred sixty-eight of the internal revenue code other than three-year property as defined in subsection (e) of such section one hundred sixty-eight of the internal revenue code which is disposed of or ceases to be in qualified use prior to the end of the taxable year in which the credit is to be taken, the amount of the credit shall be that portion of the credit provided for in this subsection which represents the ratio which the months of qualified use bear to sixty. If property on which credit has been taken is disposed of or ceases to be in qualified use prior to the end of sixty months, the difference between the credit taken and the credit allowed for actual use must be added back in the year of disposition. The amount of credit allowed for actual use shall be determined by multiplying the original credit by the ratio which the months of qualified use bear to sixty.

     (D) With respect to any property to which section one hundred sixty-eight of the internal revenue code applies, which is a building or a structural component of a building and which is disposed of or ceases to be in qualified use prior to the end of the taxable year in which the credit is to be taken, the amount of the credit shall be that portion of the credit provided for in this subsection which represents the ratio which the months of qualified use bear to the total number of months over which the taxpayer chooses to deduct the property under the internal revenue code. If property on which credit has been taken is disposed of or ceases to be in qualified use prior to the end of the period over which the taxpayer chooses to deduct the property under the internal revenue code, the difference between the credit taken and the credit allowed for actual use must be added back in the year of disposition. Provided, however, if such property is disposed of or ceases to be in qualified use after it has been in qualified use for more than twelve consecutive years, it shall not be necessary to add back the credit as provided in this subparagraph. The amount of credit allowed for actual use shall be determined by multiplying the original credit by the ratio which the months of qualified use bear to the total number of months over which the taxpayer chooses to deduct the property under the internal revenue code.

     (E) For purposes of this paragraph, disposal or cessation of qualified use shall not be deemed to have occurred solely by reason of the termination or expiration of an empire zone's designation as such.

     (F)(i) For purposes of this paragraph, the decertification of a business enterprise with respect to an empire zone shall constitute a disposal or cessation of qualified use of the property on which the credit was taken which is located in the zone  to  which  the decertification applies, on the effective date of such decertification.

(ii) Where a business enterprise has been decertified based on a finding pursuant to clause one, two, or five of subdivision (a) of section nine hundred fifty-nine of the general municipal law, the amount required to be added back by reason of this paragraph shall be augmented by an amount equal to the product of the amount of credit, with respect to property which is disposed of or ceases to be in qualified use, which was deducted from the taxpayer's tax otherwise due under this article for all prior taxable years (subject to the limit set forth in this subparagraph) and the underpayment rate of interest (without regard to compounding) set by the commissioner of taxation and finance pursuant to subdivision (j) of section six hundred ninety-seven of this chapter, in effect on the last day of the taxable year. The limit shall be (I) the amount of credit, with respect to the property which is disposed of or ceases to be in qualified use, which was deducted from the taxpayer's tax otherwise due under this article for all prior taxable years, reduced (but not below zero) by (II) the credit allowed for actual use. For purposes of this subparagraph, the attribution to specific property of credit amount deducted from tax shall be established in accordance with the date of placement in service of such property in the empire zone.

(iii) In no event shall the amount of the credit allowed pursuant to this subsection be rendered, solely by reason of clause (i) of this subparagraph, less than the amount of the credit to which the taxpayer would otherwise be entitled under subsection (a) of this section.

(iv) Notwithstanding any other provision of this subsection, in the case of a business enterprise which has been decertified, any amount of credit allowed with respect to the property of such business enterprise located in the zone to which the decertification applies which is carried over pursuant to paragraph four of this subsection shall not be carried over beyond the seventh taxable year next following the taxable year with respect to which the credit provided for in this subsection was allowed.

     (G) For purposes of this paragraph, where a credit is allowed with respect to an air pollution control facility on the basis of a certificate of compliance issued pursuant  to  the  environmental conservation law and the certificate is revoked pursuant to subdivision three of section 19-0309 of the environmental conservation law, such revocation shall constitute a disposal or cessation of qualified use, except with respect to property contained in or comprising such facility which is described in clause (i), (ii) or (iii) of subparagraph (E) of paragraph two of this subsection other than as part of or comprising an air pollution control facility. Also for purposes of this paragraph, the use of an air pollution control facility or an industrial waste treatment facility for the primary purpose of salvaging materials which are usable in the manufacturing process or are marketable shall constitute a cessation of qualified use, except with respect to property contained in or comprising such facility which is described in clause (i) or (iii) of subparagraph (E) of paragraph two of this subsection.

  * NB Applies to property to which the amendments made by section 201 of Public Law 99-514 apply

(j-1) Empire Zone Employment Incentive Credit

(1) Where a taxpayer is allowed a credit under subsection (j) of this section, the taxpayer shall be allowed a credit for each of the three years next succeeding the taxable year for which the credit under such subsection (j) is allowed, with respect to such property, whether or not deductible in such taxable year or in subsequent taxable years pursuant to paragraph four of subsection (j) of this section, of thirty percent of the credit allowable under such subsection (j); provided, however, that the credit allowable under this subsection for any taxable year shall only be allowed if the average number of employees employed by the taxpayer in the empire zone, designated pursuant to article eighteen-B of the general municipal law, in which such property is located during such taxable year is at least one hundred one percent of the average number of employees employed by the taxpayer in such empire zone or, where applicable, in the geographic area subsequently constituting such zone, during the taxable year immediately preceding the taxable year for which the credit under such subsection (j) is allowed and provided, further, that in the case of a new business, the credit allowable under this subsection for any taxable year shall be allowed if the average number of employees employed in such empire zone in such taxable year is at least one hundred one percent of the average number of such employees during the taxable year in which the credit under such subsection (j) is allowed.

(2) The average number of employees employed in an empire zone, or, where applicable, in the geographic area subsequently constituting such zone, in a taxable year shall be computed by ascertaining the number of such employees within such zone, or, where applicable, in the geographic area subsequently constituting such zone, employed by the taxpayer on the thirty-first day of March, the thirtieth day of June, the thirtieth day of September and the thirty-first day of December in the taxable year, by adding together the number of employees ascertained in each of such dates and dividing the sum so obtained by the number of such abovementioned dates occurring within the taxable year.

(3) If the amount of credit allowed under this subsection for any taxable year shall exceed the taxpayer's tax for such year, the excess may be carried over to the following year or years and may be deducted from the taxpayer's tax for such year or years. In lieu of carrying over any such excess, a taxpayer who qualified as an owner of a new business for purposes of paragraph ten of subsection (a) of this section may, at his option, receive fifty percent of such excess as a refund. Any refund paid pursuant to this paragraph shall be deemed to be a refund of an overpayment of tax as provided in section six hundred eighty-six of this article, provided, however, that no interest shall be paid thereon.

(k) Empire Zone Wage Tax Credit

(1) A taxpayer shall be allowed a credit, to be computed as hereinafter provided, against the tax imposed by this article, where the taxpayer has been certified pursuant to article eighteen-B of the general municipal law. The amount of such credit shall be as prescribed in paragraph four of this subsection.

(2) For the purposes of this subsection, the following terms shall have the following meanings:

     (A) "Empire zone wages" means wages paid by the taxpayer for full-time employment during the taxable year, in an area designated or previously designated as an empire zone or zone equivalent area pursuant to article eighteen-B of the general municipal law, where such employment is in a job created in the area (i) during the period of its designation as an empire zone, (ii) within four years of the expiration of such designation, or (iii) during the ten year period immediately following the date of designation as a zone equivalent area, provided, however, that if the taxpayer's certification under article eighteen-B of the general municipal law is revoked with respect to an empire zone or zone equivalent area, any wages paid by the taxpayer, on or after the effective date of such decertification, for employment in such zone shall not constitute empire zone wages.

     (B) "Targeted employee" means a New York resident who receives empire zone wages and who is (i) an eligible individual under the provisions of the targeted jobs tax credit (section fifty-one of the internal revenue code), (ii) eligible for benefits under the provisions of the job training partnership act (P.L. 97-300, as amended), (iii) a recipient of public assistance benefits or (iv) an individual whose income is below the most recently established poverty rate promulgated by the United States department of commerce, or a member of a family whose family income is below the most recently established poverty rate promulgated by the appropriate federal agency.  An individual who satisfies the criteria set forth in clause (i), (ii) or (iv) at the time of initial employment in the job with respect to which the credit is claimed, or who satisfies the criterion set forth in clause (iii) at such time or at any time within the previous two years, shall be a targeted employee so long as such individual continues to receive empire zone wages.

     (C) "Average number of individuals employed full-time" shall be computed by ascertaining the number of such individuals employed by the taxpayer on the thirty-first day of March, the thirtieth day of June, the thirtieth day of September and the thirty-first day of December during each taxable year or other applicable period, by adding together the number of such individuals ascertained on each of such dates and dividing the sum so obtained by the number of such dates occurring within such taxable year or other applicable period.

(3) The credit provided for herein shall be allowed only where the average number of individuals employed full-time by the taxpayer in (i) the state and (ii) the empire zone or area previously constituting such zone or zone equivalent area, during the taxable year exceeds the average number of such individuals employed full-time by the taxpayer in (i) the state and (ii) such zone or area subsequently or previously constituting such zone or such zone equivalent area, respectively, during the four years immediately preceding the first taxable year in which the credit is claimed with respect to such zone or area. Where the taxpayer provided full-time employment within (i) the state or (ii) such zone or area during only a portion of such four-year period, then for purposes of this paragraph the term "four years" shall be deemed to refer instead to such portion, if any.

  * The credit shall be allowed only with respect to the first taxable year during which payments of empire zone wages are made and the conditions set forth in this paragraph are satisfied, and with respect to each of the four taxable years next following (but only, with respect to each of such years, if such conditions are satisfied), in accordance with paragraph four of this subsection. Subsequent certifications of the taxpayer pursuant to article eighteen-B of the general municipal law, at the same or a different location in the same empire zone or zone equivalent area or at a location in a different empire zone or zone equivalent area, shall not extend the five taxable year time limitation on the allowance of the credit set forth in the preceding sentence. Provided, further, however, that no credit shall be allowed with respect to any taxable year beginning more than four years following the taxable year in which designation as an empire zone expired or more than ten years after the designation as a zone equivalent area.

  * NB Applies to taxable years beginning on or after January 1, 2001

* (4) The amount of the credit shall equal the sum of  (i) the product of three thousand dollars and the average number of individuals employed full-time by the taxpayer, computed pursuant to the provisions of subparagraph (C) of paragraph two of this subsection, who

(I) received empire zone wages for more than half of the taxable year,

(II) received with respect to more than half of the period of employment by the taxpayer during the taxable year, an hourly wage which was at least one hundred thirty-five percent of the minimum wage specified in section six hundred fifty-two of the labor law, and

(III) are targeted employees; and  (ii) the product of fifteen hundred dollars and the average number of individuals (excluding individuals described in subparagraph (i) of this paragraph) employed full-time by the taxpayer, computed pursuant to the provisions of subparagraph (C) of paragraph two of this subsection, who received empire zone wages for more than half of the taxable year.  Provided, further, however, that the credit provided for herein with respect to the taxable year, and carryovers of such credit to the taxable year, deducted from the tax otherwise due, may not, in the aggregate, exceed fifty percent of the tax imposed under section six hundred one computed without regard to any credit provided for under this article.  (iii)  For purposes of calculating the amount of the credit, individuals employed within an empire zone or zone equivalent area within the immediately preceding sixty months by a related person, as such term is defined in subparagraph (c) of paragraph three of subsection (b) of section four hundred sixty-five of the internal revenue code, shall not be included in the average number of individuals described in subparagraph (i) or subparagraph (ii) of this paragraph, unless such related person was never allowed a credit under this subsection with respect to such employees.

  * NB Applies to taxable years beginning on or after January 1, 2001

(5) If the amount of the credit and carryovers of such credit allowed under this subsection for any taxable year shall exceed the taxpayer's tax for such year, the excess, as well as any part of the credit or carryovers of such credit, or both, which may not be deducted from the tax otherwise due by reason of the final sentence in paragraph four hereof, may be carried over to the following year or years and may be deducted from the taxpayer's tax for such year or years. In lieu of carrying over any such excess, a taxpayer who qualifies as an owner of a new business for purposes of paragraph ten of subsection (a) of this section may, at his option, receive fifty percent of such excess as a refund. Any refund paid pursuant to this paragraph shall be deemed to be a refund of an overpayment of tax as provided in section six hundred eighty-six of this article, provided, however, that no interest shall be paid thereon.

(l) Empire Zone Capital Tax Credit

(1) A taxpayer shall be allowed a credit against the tax imposed by this article. The amount of the credit shall be equal to twenty-five percent of the sum of the following investments and contributions made during the taxable year and certified by the commissioner of economic development: (A) qualified investments made in, or contributions in the form of donations made to, one or more empire zone capital corporations established pursuant to section nine hundred  sixty-four  of the general municipal law, (B) qualified investments in certified zone businesses which during the twelve month period immediately preceding the month in which such investment is made employed full-time within the state an average number of individuals of two hundred fifty or fewer, computed pursuant to the provisions of subparagraph (C) of paragraph two of subsection (k) of this section, except for investments made by or on behalf of an owner of the business including,  but  not limited to, a stockholder, partner or sole proprietor, or any related person, as defined in subparagraph (C) of paragraph three of subsection (b) of section four hundred sixty-five of the internal revenue code, and (C) contributions of money to community development projects as defined in regulations promulgated by the commissioner of economic development. "Qualified investments" means the contribution of property to a corporation in exchange for original issue capital stock or other ownership interest, the contribution of property to a partnership in exchange for an interest in the partnership, and similar contributions in the case of a business entity not in corporate or partnership form in exchange for an ownership interest in such entity. The total amount of credit allowable to a taxpayer under this provision for all years, taken in the aggregate, shall not exceed three hundred thousand dollars, and shall not exceed one hundred thousand dollars with respect to the investments and contributions described in each of subparagraphs (A), (B) and (C) of this paragraph.

* (2) The credit allowed under this subsection for any taxable year shall not exceed the tax imposed by section six hundred one of this article for the taxable year, reduced by the credits permitted under subsections (b) and (c) of this section and sections six hundred twenty, six hundred twenty-one and six hundred thirty-five of this article, nor may any unused credit be carried over to the following year or years. In addition, no taxpayer shall be allowed such credit, or such credits with respect to more than one year, taken in the aggregate, of more than one hundred thousand dollars. In addition, such credit may not exceed fifty percent of the tax imposed under section six hundred one of this article computed without regard to any credit provided for by this section.

  * NB Applies to taxable years beginning on or after January 1, 1986.

* (2) (A) If the amount of the credit and carryovers of such credit allowed under this subsection for any taxable year shall exceed the taxpayer's tax for such year, or if any part of the credit or carryovers of such credit may not be deducted from the tax otherwise due by reason of the final sentence of this subparagraph, any amount of credit or carryovers of such credit thus not deductible in such taxable year may be carried over to the following year or years and may be deducted from the tax for such year or years. In addition, the amount of such credit, and carryovers of such credit to the taxable year, deducted from the tax otherwise due may not, in the aggregate, exceed fifty percent of the tax imposed under section six hundred one computed without regard to any credit provided for by this section.

     (B) In the case of a husband or wife who is required to file a separate return, the limitation provided for in paragraph one of this subsection shall be fifty thousand dollars in lieu of one hundred thousand dollars and one hundred fifty thousand dollars in lieu of three hundred thousand dollars, unless the spouse of the taxpayer has no credit allowable under this subsection for the taxable year of such spouse which ends within or with the taxpayer's taxable year.

     (C) In the case of an estate or trust, the limitation provided for in paragraph one of this subsection shall be reduced to an amount which bears the same ratio to one hundred thousand dollars and an amount which bears the same ratio to three hundred thousand dollars as the portion of the income of the estate or trust which is not allocated to beneficiaries bears to the total income of the estate or trust.

  * NB Applies to taxable years beginning after 1986

(3) Where the stock, partnership interest or other ownership interest arising from a qualified investment as described in subparagraphs (A) and (B) of paragraph one of this subsection is disposed of, the taxpayer's New York taxable income shall be computed, pursuant to regulations promulgated by the commissioner, so as to properly reflect the reduced cost thereof arising from the application of the credit provided for herein.

(4) (A) Where a taxpayer sells, transfers or otherwise disposes of corporate stock, a partnership interest or other ownership interest arising from the making of a qualified investment which was the basis, in whole or in part, for the allowance of the credit provided for under this subsection, or where a contribution or investment which was the basis for such allowance is in any manner, in whole or in part, recovered by such taxpayer, and such disposition or recovery occurs during the taxable year or within thirty-six months from the close of the taxable year with respect to which such credit is allowed, subparagraph (B) of this paragraph shall apply.

     (B) The taxpayer shall add back with respect to the taxable year in which the disposition or recovery described in subparagraph (A) of this paragraph occurred the required portion of the credit originally allowed.

    (C) The required portion of the credit originally allowed shall be the product of (i) the portion of such credit attributable to the property disposed of or the payment or contribution recovered and (ii) the applicable percentage.

     (D) The applicable percentage shall be:  (i) one hundred percent, if the disposition or recovery occurs within the taxable year with respect to which the credit is allowed or within twelve months of the end of such taxable year,  (ii) sixty-seven percent, if the disposition or recovery occurs more than twelve but not more than twenty-four months after the end of the taxable year with respect to which the credit is allowed, or  (iii) thirty-three percent, if the disposition or recovery occurs more than twenty-four but not more than thirty-six months after the end of the taxable year with respect to which the credit is allowed.

(bb) QEZE Credit for Real Property Taxes

(1) Allowance of credit. A taxpayer which is a sole proprietor of a qualified empire zone enterprise (QEZE), or a member of a partnership which is a QEZE, shall be allowed a credit for eligible real property taxes, to be computed as provided in section fifteen of this chapter, against the tax imposed by this article.

(2) Application of credit. If the amount of the credit allowed under this subsection for any taxable year shall exceed the taxpayer's tax for such year, the excess shall be treated as an overpayment of tax to be credited or refunded in accordance with the provisions of section six hundred eighty-six of this article, provided, however, that no interest shall be paid thereon.

(cc) QEZE Tax Reduction Credit

Allowance of credit. A taxpayer which is a sole proprietor of a qualified empire zone enterprise (QEZE), or a member of a partnership which is a QEZE, shall be allowed a QEZE tax reduction credit against the tax imposed by subsections (a) through (e) of section six hundred one of this part.

(dd) Order of Credits

Credits allowable under this article which cannot be carried over and which are not refundable shall be deducted first.  Credits allowable under this article which can be carried over, and carryovers of such credits, shall be deducted next, and among such credits, those whose carryover is of limited duration shall be deducted before those whose carryover is of unlimited duration. Credits allowable under this article which are refundable shall be deducted last.

(ee) Cross References

For credit in respect of:

(1) taxes withheld on wages, see section six hundred seventy-three,

(2) taxes imposed on a resident by other states, see section six hundred twenty,

(3) taxes overpaid for a prior taxable year, see section six hundred eighty-six,

* (4) taxes paid by a trust for a prior taxable year on income subsequently distributed, see sections six hundred twenty-one and six hundred forty.

  * NB Applies to taxable years beginning prior to 1988

* (4) taxes paid by a trust for a prior taxable year on income subsequently distributed, see sections six hundred twenty-one and six hundred thirty-five.

  * NB Applies to taxable years beginning after 1987