New York State COVID-19 Capital Costs Tax Credit Program Now Available Until Program Funds are Exhausted
If you are an independently owned and operated business in New York State that incurred additional COVID-19-related operational costs – from structural changes and building upgrades to health-related supplies and materials – you may be eligible for financial assistance in the form of a refundable tax credit to help reduce pandemic-related financial impacts on your business.
The time to act is now.
Eligibility requirements for the State’s COVID-19 Capital Costs Tax Credit Program include:
- 100 employees or less
- Gross receipts of less than $2.5 million in New York State for the taxable year that includes December 31, 2021
- Have at least $2,000 of qualifying expenses (see below) between January 1, 2021 and December 31, 2022.
Small businesses meeting eligibility requirements can receive a tax credit of 50% of qualifying expenses up to a maximum of $25,000 in tax credits (based on qualifying expenses of $50,000).
New York Capital Costs Tax Credit Program Qualifying Expenses
The Empire State Development website provides additional details on the program, including this list of qualifying expenses you may have incurred in the following categories of items:
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Qualifying Expenses
New York COVID-19 Capital Costs Tax Credit Program
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- Supplies to disinfect and/or protect against COVID-19 transmission
- Restocking of perishable goods to replace those lost during the COVID-19 pandemic
- Physical barriers and sneeze guard
- Hand sanitizer stations
- Respiratory devices such as air purifier systems installed at the business entity's location
- Signage related to the COVID-19 pandemic including, but not limited to, signage detailing vaccine and masking requirements, and social distancing
- Materials required to define and/or protect space such as barriers
- Materials needed to block off certain seats to allow for social distancing
- Certain point of sale payment equipment to allow for contactless payment
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- Equipment and/or materials and supplies for new product lines in response to the COVID-19 pandemic
- Software for online payment platforms to enable delivery or contactless purchases
- Building construction and retrofits to accommodate social distancing and installation of air purifying equipment but not for costs for non-COVID-19 pandemic related capital renovations or general "closed for renovations" upgrades
- Machinery and equipment to accommodate contactless sales
- Materials to accommodate increased outdoor activity such as heat lamps, outdoor lighting, and materials related to outdoor space expansions
- Other costs as determined by the department
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Source: https://esd.ny.gov/covid-19-capital-costs-tax-credit#regulations-&-comment-period
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How to Claim the New York Capital Costs Tax Credit
Credits will be awarded on a first come first serve basis until the $250 million program fund is depleted, so time is of the essence for businesses to apply and capture the credit.
To begin, complete a required eligibility screening tool to determine if your business qualifies for the program. Once qualified, you will be emailed a link to an application that must be completed and accompanied by documentation to show proof of expenses.
If you have any questions about eligibility, the application process, or required documentation for this New York State tax credit, please contact the Freed Maxick Tax Team.