§ 22 — Allowance of credit, amount and limitations

New York § 22

• Jurisdiction: New York
• Law PBG: Public Housing
• Art. 2-A: New York State Low Income Housing Tax Credit Program

Text

§ 22. Allowance of credit, amount and limitations. 1. A taxpayer\nsubject to tax under article nine-A, twenty-two, or thirty-three of the\ntax law which owns an interest in one or more eligible low-income\nbuildings, or a transferee of such a taxpayer as described in\nsubdivision eight of this section, shall be allowed a credit against\nsuch tax for the amount of low-income housing credit allocated by the\ncommissioner to each such building. Except as provided in subdivision\ntwo of this section, the credit amount so allocated shall be allowed as\na credit against the tax for the ten taxable years in the credit period.\n 2. Adjustment of first-year credit allowed in eleventh year. The\ncredit allowable for the first taxable year of the credit period with\nrespect to any building shall be adjusted using the rules of section\n42(f)(2) of the internal revenue code (relating to first-year adjustment\nof qualified basis by the weighted average of low-income to total\nresidential units), and any reduction in first-year credit by reason of\nsuch adjustment shall be allowable for the first taxable year following\nthe credit period.\n 3. Amount of credit. Except as provided in subdivisions four and five\nof this section, the amount of low-income housing credit shall be the\napplicable percentage of the qualified basis of each eligible low-income\nbuilding. Buildings financed by refunded bonds using the rules of\nsection 146(i)(6) of the internal revenue code, shall be eligible for\ncredit pursuant to the rules of section 42(b)(2) of the internal revenue\ncode.\n * 4. Statewide limitation. The aggregate dollar amount of credit which\nthe commissioner may allocate to eligible low-income buildings under\nthis article shall be one hundred eighty-seven million dollars. The\nlimitation provided by this subdivision applies only to allocation of\nthe aggregate dollar amount of credit by the commissioner and does not\napply to allowance to a taxpayer of the credit with respect to an\neligible low-income building for each year of the credit period.\n * NB Effective until April 1, 2026\n * 4. Statewide limitation. The aggregate dollar amount of credit which\nthe commissioner may allocate to eligible low-income buildings under\nthis article shall be two hundred seventeen million dollars. The\nlimitation provided by this subdivision applies only to allocation of\nthe aggregate dollar amount of credit by the commissioner and does not\napply to allowance to a taxpayer of the credit with respect to an\neligible low-income building for each year of the credit period.\n * NB Effective April 1, 2026 until April 1, 2027\n * 4. Statewide limitation. The aggregate dollar amount of credit which\nthe commissioner may allocate to eligible low-income buildings under\nthis article shall be two hundred forty-seven million dollars. The\nlimitation provided by this subdivision applies only to allocation of\nthe aggregate dollar amount of credit by the commissioner and does not\napply to allowance to a taxpayer of the credit with respect to an\neligible low-income building for each year of the credit period.\n * NB Effective April 1, 2027 until April 1, 2028\n * 4. Statewide limitation. The aggregate dollar amount of credit which\nthe commissioner may allocate to eligible low-income buildings under\nthis article shall be two hundred seventy-seven million dollars. The\nlimitation provided by this subdivision applies only to allocation of\nthe aggregate dollar amount of credit by the commissioner and does not\napply to allowance to a taxpayer of the credit with respect to an\neligible low-income building for each year of the credit period.\n * NB Effective April 1, 2028 until April 1, 2029\n * 4. Statewide limitation. The aggregate dollar amount of credit which\nthe commissioner may allocate to eligible low-income buildings under\nthis article shall be three hundred seven million dollars. The\nlimitation provided by this subdivision applies only to allocation of\nthe aggregate dollar amount of credit by the commissioner and does not\napply to allowance to a taxpayer of the credit with respect to an\neligible low-income building for each year of the credit period.\n * NB Effective April 1, 2029\n 5. Building limitation. The dollar amount of credit allocated to any\nbuilding shall not exceed the amount the commissioner determines is\nnecessary for the financial feasibility of the project and the viability\nof the building as an eligible low-income building throughout the credit\nperiod. In allocating a dollar amount of credit to any building, the\ncommissioner shall specify the applicable percentage and the maximum\nqualified basis which may be taken into account under this article with\nrespect to such building. The applicable percentage and the maximum\nqualified basis with respect to a building shall not exceed the amounts\ndetermined in subdivisions one and six, respectively, of section\ntwenty-one of this article.\n 6. Long-term commitment to low-income housing required. No credit\nshall be allowed under this article with respect to a building for the\ntaxable year unless an extended low-income housing commitment is in\neffect as of the end of such taxable year. For purposes of this\nsubdivision, the term "extended low-income housing commitment" means an\nagreement between the taxpayer and the commissioner substantially\nsimilar to the agreement specified in section 42(h)(6)(B) of the\ninternal revenue code.\n 7. Credit to successor owner. If a credit is allowed under subdivision\none of this section with respect to an eligible low-income building and\nsuch building (or an interest therein) is sold during the credit period,\nthe credit for the period after the sale which would have been allowable\nunder such subdivision one to the prior owner had the building not been\nsold shall be allowable to the new owner. Credit for the year of sale\nshall be allocated between the parties on the basis of the number of\ndays during such year that the building or interest was held by each.\n 8. (a) A taxpayer allowed a credit pursuant to this article may\ntransfer the credit, in whole or in part, to another person or entity,\nwho shall be referred to as the transferee, without regard to how any\nfederal low-income housing tax credit with respect to the low-income\nbuilding may be allocated and notwithstanding that such other person or\nentity owns no interest in the eligible low-income building or in an\nentity with an ownership interest in the eligible low-income building.\nTransferees shall be entitled to apply transferred credit to a tax\nimposed under article nine-A, twenty-two or thirty-three of the tax law,\nprovided all requirements for claiming the credit are met. A transferee\nmay not transfer any credit, or portion thereof, acquired by transfer.\n (b) A taxpayer allowed a credit pursuant to this article must enter\ninto a transfer contract with the transferee. The transfer contract must\nspecify\n (i) the building identification numbers for all buildings in the\nproject;\n (ii) the date each building was placed into service;\n (iii) the fifteen year compliance period for the project;\n (iv) the schedule of years for which the transfer credit may be\nclaimed and the amount of credit previously claimed;\n (v) the amount of consideration received by the taxpayer for the\ntransfer credit; and\n (vi) the amount of credit being transferred.\n (c) No transfer shall be effective unless the taxpayer allowed a\ncredit pursuant to this article and seeking to transfer the credit files\na transfer statement with the commissioner prior to the transfer and the\ncommissioner approves such transfer. The transfer statement shall\nprovide the name and federal identification numbers of the filing\ntransferor and the taxpayer to whom the filing transferor transferred\nthe credit, and the amount of credit transferred to each such person or\nentity. A copy of the transfer contract shall be attached to the\ntransfer statement. The statement shall also contain such other\ninformation as the commissioner may require. After reviewing the\ntransfer contract and the transfer statement, the commissioner shall\napprove or deny the transfer as provided in this subdivision. If the\ncommissioner approves the transfer, the commissioner shall issue an\napproval statement that provides the name of the transferor and\ntransferee, the amount of credit being transferred and such other\ninformation as the commissioner and the commissioner of taxation and\nfinance deem necessary. A copy of the commissioner's approval statement\nmust be attached to the transferee's tax return. If the commissioner\ndenies the transfer, the commissioner shall provide the taxpayer a\nwritten determination for such denial. The commissioner, in consultation\nwith the commissioner of taxation and finance, may establish such other\nprocedures and standards deemed necessary for the transferability of the\nlow-income housing credit.\n (d) The commissioner shall forward copies of all transfer statements\nand attachments thereto and approval statements to the department of\ntaxation and finance within thirty days after the transfer is approved\nby the commissioner.\n