Creates a biotechnology research and development investment tax credit; provides that such credit shall be the product of fifteen percent and the qualified Bio/Med research and development costs paid or incurred in the state; allows credit for the taxable year in which the qualified Bio/Med research and development activity occurs.
STATE OF NEW YORK
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4420--A
2017-2018 Regular Sessions
IN ASSEMBLY
February 2, 2017
___________
Introduced by M. of A. SCHIMMINGER, JAFFEE, MAGNARELLI, BLAKE, STIRPE,
RIVERA, ENGLEBRIGHT, SKARTADOS, VANEL -- Multi-Sponsored by -- M. of
A. ABBATE, COOK, SOLAGES, THIELE -- read once and referred to the
Committee on Ways and Means -- recommitted to the Committee on Ways
and Means in accordance with Assembly Rule 3, sec. 2 -- committee
discharged, bill amended, ordered reprinted as amended and recommitted
to said committee
AN ACT to amend the tax law, in relation to the creation of a biotech-
nology research and development investment tax credit
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. The tax law is amended by adding a new section 24-b to read
2 as follows:
3 § 24-b. Bioscience and medical technology (Bio/Med) research and
4 development tax credit. (a) Definitions. As used in this section, the
5 following terms shall have the following meanings:
6 (1) "Qualified Bio/Med research and development costs" means qualified
7 research expenses and basic research payments as defined in sections 41
8 (b) and (e) of the internal revenue code, except it does not include
9 expenses incurred for qualified research or basic research conducted
10 outside of New York state, for purposes of developing a product or phar-
11 maceutical, instrument, apparatus, machine, contrivance, implant or
12 other similar or related article, including a component part or accesso-
13 ry that are applicable to the prevention, treatment or cure of a disease
14 or condition of human beings.
15 (2) "Qualified Bio/Med company" is a corporation, partnership, limited
16 partnership or other entity which is engaged in the production of a
17 product or pharmaceutical, instrument, apparatus, machine, contrivance,
18 implant or other similar or related article, including a component part
19 or accessory that are applicable to the prevention, treatment or cure of
20 a disease or condition of human beings.
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD06143-03-8
A. 4420--A 2
1 (b) (1) Allowance of credit. A taxpayer which is a qualified Bio/Med
2 company, sole proprietor or a member of a partnership, and which is
3 subject to tax under articles nine-A or twenty-two of this chapter,
4 shall be allowed a credit against such tax, pursuant to the provisions
5 referenced in subdivision (d) of this section, to be computed as herein-
6 after provided.
7 (2) The amount of the credit shall be the product (or pro rata share
8 of the product, in the case of a member of a partnership) of fifteen
9 percent and the qualified Bio/Med research and development costs paid or
10 incurred in the state. The credit shall be allowed for the taxable year
11 in which the qualified Bio/Med research and development activity occurs.
12 If the amount of the credit is at least one million dollars but less
13 than five million dollars, the credit shall be claimed over a two year
14 period beginning in the first taxable year in which the credit may be
15 claimed and in the next succeeding taxable year, with one-half of the
16 amount of credit allowed being claimed in each year. If the amount of
17 the credit is at least five million dollars, the credit shall be claimed
18 over a three year period beginning in the first taxable year in which
19 the credit may be claimed and in the next two succeeding taxable years,
20 with one-third of the amount of the credit allowed being claimed in each
21 year.
22 (3) No qualified Bio/Med research and development costs used by a
23 taxpayer either as the basis for the allowance of the credit provided
24 for under this section or used in the calculation of the credit provided
25 for under this section shall be used by such taxpayer to claim any other
26 credit allowed pursuant to this chapter.
27 (c) Cross-references. For application of the credit provided for in
28 this section, see the following provisions of this chapter:
29 (1) article 9-A: section 210-B: subdivision 53.
30 (2) article 22: section 606: subsection (ccc).
31 (d) Allocation of credit. (1) The aggregate amount of tax credits
32 allowed under this section, subdivision fifty-three of section two
33 hundred ten-B and subsection (ccc) of section six hundred six of this
34 chapter in any calendar year shall be fifty million dollars in two thou-
35 sand eighteen, and each succeeding year up to and including two thousand
36 twenty-one.
37 (2) For the period two thousand nineteen through two thousand twenty-
38 two, in addition to the amount of credit established in paragraph one of
39 this subdivision, a taxpayer shall be allowed a credit equal to the
40 product (or pro rata share of the product, in the case of a member of a
41 partnership) of five percent and the amount of the qualified Bio/Med
42 research and development costs by a qualified Bio/Med company in one of
43 the counties specified in this paragraph. For purposes of this addi-
44 tional credit, the services must be performed or the personal property
45 must be installed in one or more of the following counties: Albany,
46 Allegany, Broome, Cattaraugus, Cayuga, Chautauqua, Chemung, Chenango,
47 Clinton, Columbia, Cortland, Delaware, Dutchess, Erie, Essex, Franklin,
48 Fulton, Genesee, Greene, Hamilton, Herkimer, Jefferson, Lewis, Living-
49 ston, Madison, Monroe, Montgomery, Niagara, Oneida, Onondaga, Ontario,
50 Orleans, Oswego, Otsego, Rensselaer, Saratoga, Schenectady, Schoharie,
51 Schuyler, Seneca, St. Lawrence, Steuben, Sullivan, Tioga, Tompkins,
52 Ulster, Warren, Washington, Wayne, Wyoming, or Yates. The aggregate
53 amount of tax credits allowed pursuant to the authority of this para-
54 graph shall be ten million dollars each year during the period two thou-
55 sand nineteen through two thousand twenty-two of the annual allocation
56 made available to the program pursuant to this subdivision. If the total
A. 4420--A 3
1 amount of allocated credits applied for under this paragraph in any year
2 exceeds the aggregate amount of tax credits allowed for such year under
3 this paragraph, such excess shall be treated as having been applied for
4 on the first day of the next year. If the total amount of allocated tax
5 credits applied for under this paragraph at the conclusion of any year
6 is less than ten million dollars, the remainder shall be treated as part
7 of the annual allocation made available to the program pursuant to
8 subdivision (d) of this section. However, in no event may the total of
9 the credits allocated under this paragraph exceed ten million dollars in
10 any year during the period two thousand nineteen through two thousand
11 twenty-two.
12 § 2. Section 210-B of the tax law is amended by adding a new subdivi-
13 sion 53 to read as follows:
14 53. Bio/Med research and development investment credit. A taxpayer
15 shall be allowed a credit, to be computed as provided in section twen-
16 ty-four-b of this chapter, against the tax imposed by this article. In
17 no event shall the credit allowed under this subdivision for any taxable
18 year reduce the tax due for such year to less than the amount prescribed
19 in paragraph (d) of subdivision one of section two hundred ten of this
20 article. However, if the amount of credit allowed under this subdivision
21 for any taxable year reduces the tax to such amount or if the taxpayer
22 otherwise pays tax based on the fixed dollar minimum amount, any amount
23 of credit thus not deductible in such taxable year shall be treated as
24 an overpayment of tax to be credited in accordance with the provisions
25 of section one thousand eighty-six of this chapter. Provided, however,
26 the provisions of subsection (c) of section one thousand eighty-eight of
27 this chapter notwithstanding, no interest shall be paid thereon.
28 § 3. Section 606 of the tax law is amended by adding a new subsection
29 (ccc) to read as follows:
30 (ccc) Bio/Med research and development investment credit. A taxpayer
31 shall be allowed a credit, to be computed as provided in section twen-
32 ty-four-b of this chapter, against the tax imposed by this article. If
33 the amount of the credit allowed under this subsection for any taxable
34 year shall exceed the taxpayer's tax for such year, the excess shall be
35 treated as an overpayment of tax to be credited or refunded in accord-
36 ance with the provisions of section six hundred eighty-six of this arti-
37 cle, provided, however, that no interest shall be paid thereon.
38 § 4. This act shall take effect immediately.