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The New York State Empire Zone (EZ) Program offers an array of incentives including tax credits and utility discounts in eleven New York City Empire Zones. Businesses must be located in an empire zone or qualify as a regionally significant project, and become zone certified. Zone Coordinators are available to assist businesses determine if they qualify for zone certification.
New York City Empire Zones include: • Bronx: Hunts Point and Port Morris • Brooklyn: East Brooklyn, North Brooklyn/ Brooklyn Navy Yard, and Southwest Brooklyn • Manhattan: Chinatown and East Harlem • Queens: Far Rockaway and South Jamaica • Staten Island: North Shore and West Shore
Qualified Empire Zone Enterprises (QEZEs) In addition to the benefits available to certified firms in Empire Zones, additional incentives are available for Qualified Empire Zone Enterprises (QEZE). Certified EZ businesses that meet an annual employment test are entitled to the QEZE Tax Reduction Credit and QEZE Property Tax Credit, among other benefits. See Additional Notes, below, for details of the employment test.
QEZE Tax Reduction Credit The QEZE Tax Reduction Credit is a credit against taxes equal to a percentage of income taxes attributable to the zone enterprise based on its employment growth in the zone. This credit is available for 10 years and can reduce a company’s tax liability to zero – eliminating the alternative minimum and fixed dollar minimum tax.
QEZE Real Property Tax Credit QEZEs that own real property may receive a credit against their business corporate taxes, personal income taxes, banking corporate taxes or insurance corporate taxes. Unused credits are refundable in the year that they were earned. The credit is available for 15 years: 10 years at 100%, decreasing 20% each year thereafter. The Credit is calculated based on the number of jobs created and the real property taxes paid on property in the Zone. The company’s eligibility is determined annually.
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Businesses must first become EZ certified, and then pass an annual employment test for QEZE certification. Contact local zone coordinators for more information regarding the certification process.
In order to qualify as a QEZE, businesses must pass an employment test which compares employment (from base period to current taxable year), for employment levels within New York State and the Empire Zone. Employment in the current taxable year must exceed employment during the base period in the Empire Zone and New York State.
“Taxable year” means the business enterprise’s taxable year for federal income tax purposes. Employment number means the average number of individuals (excluding general executive officers, in the case of a corporation) employed full-time by the business. “Base period” means the four taxable years prior to the taxable year it was first Empire Zone certified. The base period is zero years for a business enterprise which is first doing business in New York State in the tax year that the enterprise is first certified.
Contact information for local Zone Coordinators is provided under Links to Additional Information, above.
This page provides general information only. The information does not address all relevant regulatory requirements of City, State or Federal Agencies, nor does it address requirements with which the business must comply on an ongoing basis. It is the business owner's responsibility to meet all City, State and Federal requirements. Failure to comply with all applicable laws and regulations may result in fines or in the suspension and/or revocation of licenses or permits, or other penalties as allowed by law.
Please note that this information is not legal advice; you can only obtain legal advice from a lawyer. For more information or assistance, please contact the issuing Agency, using the contact information above, or call 311 (or 212-NEW-YORK if outside of New York City).
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