A00532 Summary:

BILL NOA00532
 
SAME ASNo Same As
 
SPONSORCahill
 
COSPNSR
 
MLTSPNSR
 
Amd §§210-B & 606, Tax L
 
Establishes the qualified solar manufacturer facilities and operations credit for businesses which manufacture solar energy equipment.
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A00532 Actions:

BILL NOA00532
 
01/09/2019referred to ways and means
01/08/2020referred to ways and means
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A00532 Committee Votes:

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A00532 Floor Votes:

There are no votes for this bill in this legislative session.
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A00532 Text:



 
                STATE OF NEW YORK
        ________________________________________________________________________
 
                                           532
 
                               2019-2020 Regular Sessions
 
                   IN ASSEMBLY
 
                                       (Prefiled)
 
                                     January 9, 2019
                                       ___________
 
        Introduced by M. of A. CAHILL -- read once and referred to the Committee
          on Ways and Means
 
        AN  ACT  to  amend  the  tax law, in relation to the qualified solar and
          energy storage manufacturer facilities and operations credit

          The People of the State of New York, represented in Senate and  Assem-
        bly, do enact as follows:
 
     1    Section  1.  Section  210-B  of the tax law is amended by adding a new
     2  subdivision 53 to read as follows:
     3    53.  Qualified solar and energy storage  manufacturer  facilities  and
     4  operations  credit.  (a)  A  taxpayer that is whole or part of an entity
     5  that serves as the principal operator of a facility primarily  function-
     6  ing  to fabricate solar energy equipment or energy storage equipment and
     7  that meets the eligibility requirements in paragraph (b) of this  subdi-
     8  vision,  shall be allowed a credit against the tax imposed by this arti-
     9  cle. The amount of credit shall be equal to the sum of the amounts spec-
    10  ified in paragraphs (c) and (d) of this subdivision attributable to  the
    11  taxpayer  subject  to  the limitations in paragraph (e) of this subdivi-
    12  sion. For the purposes of this subdivision solar energy equipment  shall
    13  mean the manufacturing of material components in New York state designed
    14  to  produce  electricity  utilizing solar radiation as the energy source
    15  for such electricity; and energy storage equipment shall mean  materials
    16  and  devices intended to store some form of energy related to new energy
    17  technologies as described in subdivision one of section eighteen hundred
    18  fifty-four of the public authorities  law.  Such  equipment  may  employ
    19  electrical, electrochemical, supercapacitor, compressed gas, mechanical,
    20  thermal  or  other  demonstrable  means  singly or in combination.   The
    21  determination of whether solar energy equipment or energy storage equip-
    22  ment qualifies for eligible costs under this subdivision shall be deter-
    23  mined by the commissioner and, if requested  by  the  commissioner,  the
 
         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD03102-01-9

        A. 532                              2
 
     1  president of the New York state energy research and development authori-
     2  ty.
     3    (b)  An  eligible  taxpayer shall (i) have more than one hundred full-
     4  time employees employed in New York state, and  (ii)  have  a  ratio  of
     5  research  and  development funds to net sales, as referred to in section
     6  thirty-one hundred two-e of the public authorities law, which equals  or
     7  exceeds three percent during its taxable year.
     8    (c)  An  eligible  taxpayer  shall  be allowed a credit for twenty per
     9  centum of the attributable cost or similar basis for federal income  tax
    10  purposes  of  research  and  development  and  manufacturing property as
    11  defined in clause (B) of subparagraph (ii) of paragraph (b) of  subdivi-
    12  sion  one  of this section that is acquired by  the taxpayer by purchase
    13  as defined in section 179(d) of the internal revenue code and placed  in
    14  service  during the taxable year. Provided, however, for the purposes of
    15  this paragraph only, an eligible taxpayer shall be allowed a credit  for
    16  such percentage of the (i) attributable cost or similar basis for feder-
    17  al income tax purposes for property used in the testing or inspection of
    18  materials and products,
    19    (ii)  the  attributable  costs  or  expenses  associated  with quality
    20  control of the research and development or manufacturing operations,
    21    (iii) attributable fees for use of sophisticated technology facilities
    22  and processes,
    23    (iv) attributable fees  for  the  production  or  eventual  commercial
    24  distribution  of  materials  and  products  resulting from the qualified
    25  manufacturing activities of an eligible taxpayer.
    26    (v) The costs, expenses and  other  amounts  for  which  a  credit  is
    27  allowed and claimed under this paragraph shall not be used in the calcu-
    28  lation of any other credit allowed under this article.
    29    (d)  An eligible taxpayer shall be allowed a credit for ten per centum
    30  of "qualified research and manufacturing expenses" paid or  incurred  by
    31  the  taxpayer in the taxable year. For the purposes of this section, the
    32  term "qualified research and manufacturing expenses" shall mean  attrib-
    33  utable  expenses  associated  with  in-house  research and manufacturing
    34  processes, and attributable costs associated with the  dissemination  of
    35  the  results of the products that directly result from such research and
    36  development and/or manufacturing  activities;  provided,  however,  that
    37  such  costs  shall  not  include  advertising  or promotion through paid
    38  media.  In addition, costs associated with  the  preparation  of  patent
    39  applications,  patent  application  filing  fees,  patent research fees,
    40  patent examinations fees, patent post allowance fees, patent maintenance
    41  fees, and grant application expenses and fees shall be eligible for such
    42  credit.  In no case shall the credit allowed under this paragraph  apply
    43  to  expenses  for litigation or the challenge of another entity's intel-
    44  lectual property rights, or for contract expenses involving outside paid
    45  consultants.  The costs, expenses and other amounts for which  a  credit
    46  is  allowed  and  claimed  under this paragraph shall not be used in the
    47  calculation of any other credit allowed under this article.
    48    (e) An eligible taxpayer may claim credits under this subdivision  for
    49  four  consecutive  taxable years. In no case shall the credit allowed by
    50  this subdivision to a taxpayer exceed twenty-five  million  dollars  per
    51  year.
    52    (f)  The  credit  allowed  under this subdivision for any taxable year
    53  shall not reduce  the  tax  due  for  such  year  to  less  than  amount
    54  prescribed  in  paragraph  (d) of subdivision one of section two hundred
    55  ten of this article.  However, if the amount  of  credit  allowed  under
    56  this  subdivision  for  any taxable year reduces the tax to such amount,

        A. 532                              3
 
     1  any amount of credit not deductible in such taxable year shall be treat-
     2  ed as an overpayment of tax to be credited  or  refunded  in  accordance
     3  with  the provisions of section one thousand eighty-six of this chapter.
     4  Provided, however, the provisions of subsection (c) of section one thou-
     5  sand  eighty-eight of this chapter notwithstanding, no interest shall be
     6  paid thereon.
     7    § 2. Section 606 of the tax law is amended by adding a new  subsection
     8  (jjj) to read as follows:
     9    (jjj)  Qualified  solar and energy storage manufacturer facilities and
    10  operations credit. (1) A taxpayer who is a member of an entity  consist-
    11  ing  of one or more taxpayers that serves as the principal operator of a
    12  facility primarily functioning to fabricate solar  energy  equipment  or
    13  energy  storage equipment and that meets the eligibility requirements in
    14  paragraph two of this subsection, shall be allowed a credit against  the
    15  tax  imposed by this article. The amount of credit shall be equal to the
    16  sum (or pro rata share of the sum in the case of a partnership)  of  the
    17  amounts  specified  in  paragraphs  three  and  four  of this subsection
    18  subject to the limitations in paragraph five of this subsection. For the
    19  purposes of this subsection solar energy equipment shall mean the  manu-
    20  facturing  of  material components in New York state designed to produce
    21  electricity utilizing solar radiation as  the  energy  source  for  such
    22  electricity;  and  energy  storage  equipment  shall  mean materials and
    23  devices intended to store some form of  energy  related  to  new  energy
    24  technologies as described in subdivision one of section eighteen hundred
    25  fifty-four  of  the  public authorities law.   Such equipment may employ
    26  electrical, electrochemical, supercapacitor, compressed gas, mechanical,
    27  thermal or other means singly or in combination.  The  determination  of
    28  whether solar energy equipment or energy storage equipment qualifies for
    29  eligible  costs under this subsection shall be determined by the commis-
    30  sioner, and, if requested by the commissioner, the president of the  New
    31  York state energy research and development authority.
    32    (2)  An eligible entity shall (i) have more than one hundred full-time
    33  employees employed in New York state, and (ii) have a ratio of  research
    34  and development funds to net sales, as referred to in section thirty-one
    35  hundred  two-e  of  the  public authorities law, which equals or exceeds
    36  three percent during its taxable year.
    37    (3) An eligible taxpayer shall be allowed  a  credit  for  twenty  per
    38  centum  of  the  cost  or  similar basis for federal income tax purposes
    39  incurred by the entity for research and  development  and  manufacturing
    40  property  as defined in clause (B) of subparagraph (ii) of paragraph (b)
    41  of subdivision one of section two hundred ten-B of this chapter that  is
    42  acquired by purchase as defined in section 179(d) of the internal reven-
    43  ue  code and placed in service during the taxable year. Provided, howev-
    44  er, for the purposes of this paragraph only, an eligible taxpayer  shall
    45  be allowed a credit for such percentage of the (i) cost or similar basis
    46  for  federal  income  tax  purposes  for property used in the testing or
    47  inspection of materials and products,
    48    (ii) the costs or expenses associated  with  quality  control  of  the
    49  research and development or manufacturing operations,
    50    (iii)  fees  for  use of sophisticated technology facilities and proc-
    51  esses,
    52    (iv) fees for the production or eventual  commercial  distribution  of
    53  materials  and  products  resulting  from  the activities of an eligible
    54  taxpayer as long as such activities fall under the activities listed  in
    55  paragraph  (b) of subdivision one of section thirty-one hundred two-e of
    56  the public authorities law.

        A. 532                              4
 
     1    (v) The costs, expenses and  other  amounts  for  which  a  credit  is
     2  allowed and claimed under this paragraph shall not be used in the calcu-
     3  lation of any other credit allowed under this article.
     4    (4)  An eligible taxpayer shall be allowed a credit for ten per centum
     5  of "qualified research and manufacturing expenses" paid or  incurred  by
     6  the  entity  in  the taxable year. For the purposes of this section, the
     7  term "qualified research and manufacturing expenses" shall mean expenses
     8  associated with in-house research and manufacturing processes, and costs
     9  associated with the dissemination of the results of  the  products  that
    10  directly  result from such research and development and/or manufacturing
    11  activities; provided, however, that such costs shall not include  adver-
    12  tising  or  promotion  through paid media. In addition, costs associated
    13  with the preparation of patent applications, patent  application  filing
    14  fees, patent research fees, patent examinations fees, patent post allow-
    15  ance  fees,  patent maintenance fees, and grant application expenses and
    16  fees shall be eligible for such credit. In  no  case  shall  the  credit
    17  allowed  under  this  paragraph  apply to expenses for litigation or the
    18  challenge of another  entity's  intellectual  property  rights,  or  for
    19  contract   expenses  involving  outside  paid  consultants.  The  costs,
    20  expenses and other amounts for which a credit  is  allowed  and  claimed
    21  under  this  paragraph shall not be used in the calculation of any other
    22  credit allowed under this article.
    23    (5) An eligible taxpayer may claim credits under this  subsection  for
    24  four  consecutive  taxable years. In no case shall the credit allowed by
    25  this subdivision to a taxpayer exceed twenty-five  million  dollars  per
    26  year.  If the taxpayer is a partner in a partnership or shareholder of a
    27  New York S corporation, then the cap imposed by this paragraph shall  be
    28  applied at the entity level, so that the aggregate credit allowed to all
    29  the  partners, shareholders, or other members of each such entity in the
    30  taxable year does not exceed twenty-five million dollars per year for up
    31  to four consecutive taxable years.
    32    (6) If the amount of credit allowed  under  this  subsection  for  any
    33  taxable  year  shall exceed the taxpayer's tax for such year, the excess
    34  shall be treated as an overpayment of tax to be credited or refunded  in
    35  accordance with the provisions of section six hundred eighty-six of this
    36  article, provided, however, that no interest shall be paid thereon.
    37    §  3. Subparagraph (B) of paragraph 1 of subsection (i) of section 606
    38  of the tax law is amended by adding a  new  clause  (xliv)  to  read  as
    39  follows:
    40  (xliv) Credit for                    Amount of credit under
    41  qualified solar and energy storage   subdivision fifty-three
    42  manufacturer facilities              of section two hundred
    43  and operations credit                ten-B
    44  under subsection (jjj)
    45    § 4. This act shall take effect immediately and shall apply to taxable
    46  years commencing on or after January 1, 2020.
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