§ 18 — Low-income housing credit

New York § 18

• Jurisdiction: New York
• Law TAX: Tax
• Art. 1: Short Title; Definitions; Miscellaneous

Text

§ 18. Low-income housing credit. (a) Allowance of credit. A taxpayer\nsubject to tax under article nine-A, twenty-two or thirty-three of this\nchapter shall be allowed a credit against such tax, pursuant to the\nprovisions referenced in subdivision (d) of this section, with respect\nto the ownership of eligible low-income buildings for which an\neligibility statement has been issued by the commissioner of housing and\ncommunity renewal. The amount of the credit shall be the credit amount\nfor each such building allocated by such commissioner as provided in\narticle two-A of the public housing law. The credit amount shall be\nallowed for each of the ten taxable years in the credit period, and any\nreduction in first-year credit as provided in subdivision two of section\ntwenty-two of such law shall be allowed in the eleventh taxable year.\n (b) Credit recapture. (1) General. If,\n (A) as of the close of any taxable year in the compliance period, the\namount of the qualified basis of any building with respect to the\ntaxpayer is less than\n (B) the amount of such basis as of the close of the preceding taxable\nyear,\n (C) then the credit recapture amount must be added back for the\ntaxable year.\n (2) Credit recapture amount. The credit recapture amount is an amount\nequal to the sum of\n (A) the aggregate decrease in the credits allowed to the taxpayer\nunder this section for all prior taxable years which would have resulted\nif the accelerated portion of the credit allowable by reason of this\nsection were not allowed for all prior taxable years with respect to the\nexcess of the amount described in subparagraph (B) of paragraph (1) of\nthis subdivision over the amount described in subparagraph (A) of such\nparagraph, plus\n (B) interest at the overpayment rate established under section one\nthousand ninety-six of this chapter on the amount determined under\nsubparagraph (A) of this paragraph for each prior taxable year for the\nperiod beginning on the due date for filing the report for the prior\ntaxable year involved.\n (3) Accelerated portion of credit. For purposes of paragraph two of\nthis subdivision, the accelerated portion of the credit for the prior\ntaxable years with respect to any amount of basis is the excess of\n (A) the aggregate credit allowed by reason of this section (without\nregard to this subdivision) for such years with respect to such basis,\nover\n (B) the aggregate credit which would be allowable by reason of this\nsection for such years with respect to such basis if the aggregate\ncredit which would (but for this subdivision) have been allowed for the\nentire compliance period were allowable ratably over fifteen years.\n (4) Special rules. For purposes of this subdivision, the rules of\nsection 42 (j)(4)(B) and (C) of the internal revenue code shall apply in\ndetermining the credit recapture amount.\n (5) Exceptions to recapture. Recapture under this subdivision shall\nnot apply to a reduction in qualified basis\n (A) by reason of a casualty loss, if the commissioner, in consultation\nwith the commissioner of housing and community renewal, determines that\nsuch loss is restored by reconstruction or replacement within a\nreasonable period, or\n (B) by reason of a change in floor space devoted to low-income units\nin a building, if such building remains an eligible low-income building\nafter such change, and if the commissioner, in consultation with the\ncommissioner of housing and community renewal, determines that such\nchange is de minimis, or\n (C) by reason of error in complying with low-income eligibility tests\nreferred to in subdivision five of section twenty-one of the public\nhousing law, if the commissioner, in consultation with the commissioner\nof housing and community renewal, determines that such error is de\nminimis.\n (6) Recapture by partners of a partnership. In the case of ownership\nof a building or interest therein by a partnership which has thirty-five\nor more partners, the provisions of section 42(j)(5) of the internal\nrevenue code shall apply to any recapture under this subdivision unless\nthe partnership elects not to have such provisions apply.\n (6-a) The taxpayer that originally received the credit shall remain\nsolely liable for all obligations and liabilities imposed on the\ntaxpayer with respect to the credit, none of which shall apply to a\nparty to whom the credit has been subsequently transferred.\n (7) (A) The credit recapture required under this subdivision will not\napply solely by reason of the disposition of a building or an interest\ntherein if it is reasonably expected that such building will continue to\nbe operated as an eligible low-income building for the remaining\ncompliance period with respect to such building.\n (B) Statute of limitations. If a building (or an interest therein) is\ndisposed of during any taxable year and there is any reduction in the\nqualified basis of such building which results in an increase in tax\nunder this section for such taxable or any subsequent taxable year, then\n (i) the statutory period for the assessment of any deficiency with\nrespect to such increase in tax will not expire before the expiration of\nthree years from the date the commissioner of housing and community\nrenewal is notified by the taxpayer (in such manner as the commissioner\nof housing and community renewal may prescribe) of such reduction in\nqualified basis, and\n (ii) such deficiency may be assessed before the expiration of such\nthree-year period notwithstanding the provisions of any other law or\nrule of law which would otherwise prevent such assessment.\n (c) Construction with public housing law; definitions. The provisions\nof this section shall be construed in conjunction with the provisions of\narticle two-A of the public housing law. For definitions relating to the\nlow-income housing credit, see section twenty-one of such law.\n (d) Cross-references. For application of the credit provided for in\nthis section, see the following provisions of this chapter:\n (1) Article 9-A: Section 210-B: subdivision 15,\n (2) Article 22: Section 606: subsections (i) and (x),\n (3) Article 33: Section 1511: subdivision (n).\n