N.Y. Tax Law § 21: Brownfield redevelopment tax credit

* § 21. Brownfield redevelopment tax credit. (a) Allowance of credit.

(1) General. A taxpayer subject to tax under article nine, nine-A,

twenty-two or thirty-three of this chapter shall be allowed a credit

against such tax, pursuant to the provisions referenced in subdivision

(f) of this section. Such credit shall be allowed with respect to a

qualified site, as such term is defined in paragraph one of subdivision

(b) of this section. The amount of the credit in a taxable year shall be

the sum of the credit components specified in paragraphs two, three and

four of this subdivision applicable in such year.

(2) Site preparation credit component. The site preparation credit

component shall be equal to the applicable percentage of the site

preparation costs paid or incurred by the taxpayer with respect to a

qualified site. The credit component amount so determined with respect

to a site's qualification for a certificate of completion shall be

allowed for the taxable year in which the effective date of the

certificate of completion occurs. The credit component amount determined

other than with respect to such qualification shall be allowed for the

taxable year in which the improvement to which the applicable costs

apply is placed in service for up to five taxable years after the

issuance of such certificate of completion; provided, however, that for

any qualified site to which a certificate of completion is issued on or

after July first, two thousand fifteen but on or before June

twenty-fourth, two thousand twenty-one, the site preparation credit

component for such costs shall be allowed for up to seven taxable years

after the issuance of such certificate of completion; and provided

further, however, that for any qualified site located in cities with a

population greater than two hundred five thousand and less than two

hundred fifteen thousand in counties with a population greater than one

million but less than one million ten thousand based on the latest

federal decennial census for which the department of environmental

conservation has issued a certificate of completion to the taxpayer on

or after January first, two thousand seventeen and before December

thirty-first, two thousand seventeen, the site preparation credit

component for such costs shall be allowed for up to fifteen taxable

years after the issuance of such certificate of completion.

(3) Tangible property credit component.

(i) The tangible property credit component shall be equal to the

applicable percentage of the cost or other basis for federal income tax

purposes of tangible personal property and other tangible property,

including buildings and structural components of buildings, which

constitute qualified tangible property and may include any related party

service fee paid; provided that in determining the cost or other basis

of such property, the taxpayer shall exclude the acquisition cost of any

item of property with respect to which a credit under this section was

allowable to another taxpayer; and provided further that for the

purposes of this section, starting with taxable year two thousand

twenty-two, on sites that comply with the track one remediation

standards promulgated pursuant to subdivision four of section 27-1415 of

the environmental conservation law, stadiums, baseball parks, basketball

courts and other athletic facilities shall be considered buildings, and

that components of stadiums, baseball parks, basketball courts, and

other athletic facilities constructed on such sites, including sports

field turf, site lighting, sidewalks, access and entry ways, and other

improvements added to land, shall be considered structural components of

buildings under the internal revenue code, and shall be included in the

definition of tangible property for the purposes of this section. A

related party service fee shall be allowed only in the calculation of

the tangible property credit component and shall not be allowed in the

calculation of the site preparation credit component or the on-site

groundwater remediation credit component. The portion of the tangible

property credit component which is attributable to related party service

fees shall be allowed only as follows: (A) in the taxable year in which

the qualified tangible property described in subparagraph (iii) of this

paragraph is placed in service, for that portion of the related party

service fees which have been earned and actually paid to the related

party on or before the last day of such taxable year; and (B) with

respect to any other taxable year for which the tangible property credit

component may be claimed under this subparagraph and in which the amount

of any additional related party service fees are actually paid by the

taxpayer to the related party, the tangible property credit component

for such amount shall be allowed in such taxable year. The credit

component amount so determined shall be allowed for the taxable year in

which such qualified tangible property is first placed in service on a

qualified site with respect to which a certificate of completion has

been issued to the taxpayer, or for the taxable year in which the

certificate of completion is issued if the qualified tangible property

is placed in service prior to the issuance of the certificate of

completion. This credit component shall only be allowed for up to one

hundred twenty months after the date of the issuance of such certificate

of completion, provided, however, that for qualified sites to which a

certificate of completion is issued on or after March twentieth, two

thousand ten, but prior to January first, two thousand twelve, the

commissioner may extend the credit component for up to one hundred

forty-four months after the date of such issuance, if the commissioner,

in consultation with the commissioner of environmental conservation,

determines that the requirements for the credit would have been met if

not for the restrictions related to the state disaster emergency

declared pursuant to executive order 202 of 2020 or any extension

thereof or subsequent executive order issued in response to the novel

coronavirus (COVID-19) pandemic; provided, however, with respect to any

qualified site for which the department of environmental conservation

has issued a certificate of completion to the taxpayer on or after March

twentieth, two thousand ten and before December thirty-first, two

thousand fifteen, this credit component shall be allowed for up to one

hundred eighty months after the date of the issuance of such certificate

of completion; and provided further, with respect to any qualified site

located in cities with a population greater than two hundred five

thousand and less than two hundred fifteen thousand in counties with a

population greater than one million but less than one million ten

thousand based on the latest federal decennial census for which the

department of environmental conservation has issued a certificate of

completion to the taxpayer on or after January first, two thousand

seventeen and before December thirty-first, two thousand seventeen, this

credit component shall be allowed for up to one hundred eighty months

after the date of the issuance of such certificate of completion.

(ii) The tangible property credit component shall be allowed with

respect to property leased to a second party only if such second party

is either (A) not a party responsible for the disposal of hazardous

waste or the discharge of petroleum at the site according to applicable

principles of statutory or common law liability, or (B) a party

responsible according to applicable principles of statutory or common

law liability if such party's liability arises solely from operation of

the site subsequent to the disposal of hazardous waste or the discharge

of petroleum, and is so certified by the commissioner of environmental

conservation at the request of the taxpayer, pursuant to section 27-1419

of the environmental conservation law. Notwithstanding any other

provision of law to the contrary, in the case of allowance of credit

under this section to such a lessor, the commissioner shall have the

authority to reveal to such lessor any information, with respect to the

issue of qualified use of property by the lessee, which is the basis for

the denial in whole or in part, or for the recapture, of the credit

claimed by such lessor. For purposes of the tangible property credit

component allowed under this section the taxpayer to whom the

certificate of completion is issued, as provided for under subdivision

five of section 27-1419 of the environmental conservation law, may

transfer the benefits and burdens of the certificate of completion,

which run with the land and to the applicant's successors or assigns

upon transfer or sale of all or any portion of an interest or estate in

the qualified site. However, the taxpayer to whom certificate's benefits

and burdens are transferred shall not include the cost of acquiring all

or any portion of an interest or estate in the site and the amounts

included in the cost or other basis for federal income tax purposes of

qualified tangible property already claimed by the previous taxpayer

pursuant to this section.

(iii) The term "related party service fee" shall mean any fee or other

monetary compensation earned by a related party and calculated as a

percentage of project and/or acquisition costs, in consideration of

services rendered to or for the benefit of the taxpayer placing

qualified tangible property in service in connection with the

acquisition and development of such property. For purposes of this

subparagraph, "related party" shall have the same meaning as related

person as defined in subparagraph (c) of paragraph three of subdivision

(b) of section four hundred sixty-five of the internal revenue code.

(iv) Eligible costs for the tangible property credit component are

limited to costs for tangible property that has a depreciable life for

federal income tax purposes of fifteen years or more, costs associated

with demolition and excavation on the site and the foundation of any

buildings constructed as part of the site cover that are not properly

included in the site preparation component and costs associated with

non-portable equipment, machinery and associated fixtures and

appurtenances used exclusively on the site, whether or not such property

has a depreciable life for federal income tax purposes of fifteen years

or more.

(v) With respect to any qualified site for which the department of

environmental conservation has issued a notice to the taxpayer on or

after July first, two thousand fifteen or the date of publication in the

state register of proposed regulations defining "underutilized" as

provided in subdivision thirty of section 27-1405 of the environmental

conservation law, whichever shall be later, that its request for

participation has been accepted under subdivision six of section 27-1407

of the environmental conservation law, and the site is eligible for the

tangible property credit component because it is an affordable housing

project pursuant to subdivision one-a of section 27-1407 of the

environmental conservation law, the portion of eligible costs to be

included in the calculation of the tangible property credit component

will be determined by multiplying the total costs qualified for the

tangible property credit component by a fraction, the numerator of which

shall be the square footage of space of the affordable housing units

dedicated to residential occupancy and the denominator of which shall be

the total square footage of the building.

(3-a) (A) Notwithstanding any other provision of law to the contrary,

the tangible property credit component available for any qualified site

pursuant to paragraph three of this subdivision shall not exceed

thirty-five million dollars or three times the sum of the costs included

in the calculation of the site preparation credit component and the

on-site groundwater remediation credit component under paragraphs two

and four, respectively, of this subdivision, and the costs that would

have been included in the calculation of such components if not treated

as an expense and deducted pursuant to section one hundred ninety-eight

of the internal revenue code, whichever is less; provided, however,

that: (1) in the case of a qualified site to be used primarily for

manufacturing activities, the tangible property credit component

available for any qualified site pursuant to paragraph three of this

subdivision shall not exceed forty-five million dollars or six times the

sum of the costs included in the calculation of the site preparation

credit component and the on-site groundwater remediation credit

component under paragraphs two and four, respectively, of this

subdivision, and the costs that would have been included in the

calculation of such components if not treated as an expense and deducted

pursuant to section one hundred ninety-eight of the internal revenue

code, whichever is less; and (2) the provisions of this paragraph shall

not apply to any qualified site for which the department of

environmental conservation has issued a notice to the taxpayer before

June twenty-third, two thousand eight that its request for participation

has been accepted under subdivision six of section 27-1407 of the

environmental conservation law.

(B) For the purposes of this paragraph, the term "manufacturing

activities" means the production of goods by manufacturing, processing,

assembling, refining, mining, extracting, farming, agriculture,

horticulture, floriculture, viticulture or commercial fishing; provided

however, that the generation and distribution of electricity, the

distribution of natural gas, and the production of steam associated with

the generation of electricity, shall not constitute manufacturing

activities.

(C) In order to properly administer the credits set forth in this

subdivision, the department may disclose information about the

calculation and the amounts of the credits claimed under this

subdivision on a taxpayer's return to the department of environmental

conservation and other taxpayers claiming tax credits under this section

with respect to the same qualifying site.

(D) With respect to any qualified site for which the department of

environmental conservation has issued a notice to the taxpayer before

July first, two thousand fifteen or the date of publication in the state

register of proposed regulations defining "underutilized" as provided in

subdivision thirty of section 27-1405 of the environmental conservation

law, whichever shall be later, that its request for participation has

been accepted under subdivision six of section 27-1407 of the

environmental conservation law, or where the taxpayer has either been

issued or received a certificate of completion from another taxpayer

under section 27-1419 of the environmental conservation law before July

first, two thousand fifteen or the date of publication in the state

register of proposed regulations defining "underutilized" as provided in

subdivision thirty of section 27-1405 of the environmental conservation

law, whichever shall be later, if the qualifying site is located in a

brownfield opportunity area and is developed in conformance with the

goals and priorities established for that applicable brownfield

opportunity area as designated pursuant to section nine hundred

seventy-r of the general municipal law, the applicable percentage of the

tangible property credit component will be increased by two percent.

(4) On-site groundwater remediation credit component. The on-site

groundwater remediation credit component shall be equal to the

applicable percentage of the on-site groundwater remediation costs paid

or incurred by the taxpayer with respect to a qualified site (to the

extent that such groundwater remediation costs are not included in the

determination of the site preparation credit or the cost or other basis

included in the determination of the tangible property credit). The

credit component so determined for costs incurred and paid with respect

to and prior to the issuance of a certificate of completion shall be

allowed for the taxable year in which the effective date of the issuance

of a certificate of completion occurs. The credit component amount

determined in taxable years after the effective date of the issuance of

a certificate of completion shall be allowed in the taxable year such

qualified costs are incurred and paid for up to five taxable years after

the issuance of such certificate of completion; provided, however, that

with respect to any qualified site for which a certificate of completion

has been issued on or after July first, two thousand fifteen but on or

before June twenty-fourth, two thousand twenty-one, the credit component

amount determined in taxable years after the effective date of the

issuance of a certificate of completion shall be allowed in the taxable

year such qualified costs are incurred and paid for up to seven taxable

years after the issuance of such certificate of completion.

(5) Applicable percentage. (A) For purposes of computing the site

preparation and on-site groundwater remediation credit components

pursuant to paragraphs two and four of this subdivision, with respect to

such qualified sites for which the department of environmental

conservation has issued a notice to the taxpayer before June

twenty-third, two thousand eight that its request for participation has

been accepted under subdivision six of section 27-1407 of the

environmental conservation law, or where the taxpayer has either been

issued or received a certificate of completion from another taxpayer

under section 27-1419 of the environmental conservation law for such a

site, and, for purposes of computing the tangible property component

pursuant to paragraph three of this subdivision with respect to such

qualified sites for which the department of environmental conservation

has issued a notice to the taxpayer before July first, two thousand

fifteen or the date of publication in the state register of proposed

regulations defining "underutilized" as provided in subdivision thirty

of section 27-1405 of the environmental conservation law, whichever

shall be later, that its request for participation has been accepted

under subdivision six of section 27-1407 of the environmental

conservation law, or where the taxpayer has either been issued or

received a certificate of completion from another taxpayer under section

27-1419 of the environmental conservation law for such a site, the

applicable percentage shall be twelve percent in the case of credits

claimed under article nine, nine-A or thirty-three of this chapter, and

ten percent in the case of credits claimed under article twenty-two of

this chapter, except that where at least fifty percent of the area of

the qualified site relating to the credit provided for in this section

is located in an environmental zone as defined in paragraph six of

subdivision (b) of this section, the applicable percentage shall be

increased by an additional eight percent. Provided, however, as afforded

in section 27-1419 of the environmental conservation law, if the

certificate of completion indicates that the qualified site has been

remediated to Track 1 as that term is described in subdivision four of

section 27-1415 of the environmental conservation law, the applicable

percentage set forth in the first sentence of this paragraph shall be

increased by an additional two percent.

(B) With respect to such qualified site for which the department of

environmental conservation has issued a notice to the taxpayer on or

after July first, two thousand fifteen, that its request for

participation has been accepted under subdivision six of section 27-1407

of the environmental conservation law, the applicable percentage for the

tangible property credit component of the brownfield redevelopment tax

credit pursuant to paragraph three of this subdivision shall be the sum

of ten percent and the following additional percentages, provided that

if the sum is greater than twenty-four percent, the total percentage of

the tangible property credit component shall be twenty-four percent and

is otherwise subject to the limitations set forth in paragraphs three

and three-a of this subdivision:

(i) five percent for a site which:

(1) is located within an environmental zone; or

(2) is in a disadvantaged community as that term is defined in section

27-1405 of the environmental conservation law for which the department

of environmental conservation has issued a notice to the taxpayer on or

after January first, two thousand twenty-three that its request for

participation has been accepted under subdivision six of section 27-1407

of the environmental conservation law;

(ii) five percent for a site located within a designated brownfield

opportunity area and is developed in conformance with the goals and

priorities established for that applicable brownfield opportunity area

and meets the conformance determinations pursuant to subdivision ten of

section nine hundred seventy-r of the general municipal law;

(iii) five percent for a site developed as affordable housing, as

defined in section 27-1405 of the environmental conservation law;

(iv) five percent for a site to be used primarily for manufacturing

activities as such term is defined in subparagraph (B) of paragraph

three-a of this subdivision;

(v) five percent for sites remediated to Track 1 as that term is

defined in subdivision four of section 27-1415 of the environmental

conservation law; and

(vi) for a qualified site for which the department of environmental

conservation has issued a notice to the taxpayer on or after January

first, two thousand twenty-three that its request for participation has

been accepted under subdivision six of section 27-1407 of the

environmental conservation law, five percent for sites developed as

renewable energy facility sites as defined in section 27-1405 of the

environmental conservation law.

(C) The taxpayer shall submit, in the manner prescribed by the

commissioner, information sufficient to demonstrate that the site

qualifies for any credit components available under subparagraph (B) of

this paragraph. If the site is receiving the credit component authorized

pursuant to clause (ii) of subparagraph (B) of this paragraph for being

located within a designated brownfield opportunity area, the taxpayer

shall submit a certification from the secretary of state that the

development is in conformance with such brownfield opportunity area plan

pursuant to section nine hundred seventy-r of the general municipal law.

(6) Site preparation costs and on-site groundwater remediation costs

paid or incurred by the taxpayer with respect to a qualified site and

the cost or other basis for federal income tax purposes of tangible

personal property and other tangible property, including buildings and

structural components of buildings, which constitute qualified tangible

property shall only include costs paid or incurred by the taxpayer on or

after the date of the brownfield site cleanup agreement executed by the

taxpayer and the department of environmental conservation pursuant to

section 27-1409 of the environmental conservation law.

(7) The amount of any grant received from the federal, state or a

local government or an instrumentality or public benefit corporation

thereof received by the taxpayer and used to pay for any of the costs

described in paragraphs two, three and four of this subdivision, which

was not included in the federal gross income of the taxpayer, shall be

subtracted in computing the credit components under this section.

(b) Definitions. As used in this section, the following terms shall

have the following meanings:

(1) Qualified site. A "qualified site" is a site with respect to which

a certificate of completion has been issued to the taxpayer by the

commissioner of environmental conservation pursuant to section 27-1419

of the environmental conservation law.

(2) Site preparation costs. The term "site preparation costs" shall

mean all amounts properly chargeable to a capital account, which are

paid or incurred which are necessary to implement a site's

investigation, remediation, or qualification for a certificate of

completion, and shall include costs of: excavation; demolition;

activities undertaken under the oversight of the department of labor or

in accordance with standards established by the department of health to

remediate and dispose of regulated materials including asbestos, lead or

polychlorinated biphenyls; environmental consulting; engineering; legal

costs; transportation, disposal, treatment or containment of

contaminated soil; remediation measures taken to address contaminated

soil vapor; cover systems consistent with applicable regulations;

physical support of excavation; dewatering and other work to facilitate

or enable remediation activities; sheeting, shoring, and other

engineering controls required to prevent off-site migration of

contamination from the qualified site or migrating onto the qualified

site; and the costs of fencing, temporary electric wiring, scaffolding,

and security facilities until such time as the certificate of completion

has been issued. Site preparation shall include all costs paid or

incurred within sixty months after the last day of the tax year in which

the certificate of completion is issued that are necessary for

compliance with the certificate of completion or subsequent

modifications thereof, or the remedial program defined in such

certificate of completion including but not limited to institutional

controls, engineering controls, an approved site management plan, and an

environmental easement with respect to the qualified site; provided,

however, with respect to any qualified site for which a certificate of

completion was issued on or after July first, two thousand fifteen but

on or before June twenty-fourth, two thousand twenty-one, site

preparation shall include all costs paid or incurred within eighty-four

months after the last day of the tax year in which the certificate of

completion is issued that are necessary for compliance with the

certificate of completion or subsequent modifications thereof, or the

remedial program defined in such certificate of completion including but

not limited to institutional controls, engineering controls, an approved

site management plan, and an environmental easement with respect to the

qualified site, provided, however, with respect to any qualified site

located in cities with a population greater than two hundred five

thousand and less than two hundred fifteen thousand in counties with a

population greater than one million but less than one million ten

thousand based on the latest federal decennial census for which the

department of environmental conservation has issued a certificate of

completion to the taxpayer on or after January first, two thousand

seventeen and before December thirty-first, two thousand seventeen, this

credit component shall be allowed for up to one hundred eighty months

after the date of the issuance of such certificate of completion. Site

preparation cost shall not include the costs of foundation systems that

exceed the cover system requirements in the regulations applicable to

the qualified site.

(3) Qualified tangible property. "Qualified tangible property" is

property described in either subparagraph (A) or (B) of this paragraph

which:

(A) (i) is depreciable pursuant to section one hundred sixty-seven of

the internal revenue code,

(ii) has a useful life of four years or more,

(iii) has been acquired by purchase as defined in section one hundred

seventy-nine (d) of the internal revenue code,

(iv) has a situs on a qualified site in this state, and

(v) is principally used by the taxpayer for industrial, commercial,

recreational or environmental conservation purposes (including the

commercial development of residential housing); or

(B) (i) is, or when occupied becomes, part of a dwelling whose primary

ownership structure is covered under either article nine-B of the real

property law or meets the requirements of section 216 (b)(1) of the

Internal Revenue Code or is part of an affordable housing project as

defined in subdivision twenty-nine of section 27-1405 of the

environmental conservation law, where units are sold as single family

homes or multiple family dwellings;

(ii) has been acquired by purchase (as defined in section one hundred

seventy-nine (d) of the Internal Revenue Code);

(iii) has a situs on a qualified site in this state; and

(iv) for purposes of this subparagraph only, and notwithstanding any

other section of law to the contrary, property qualifying under this

subparagraph shall be deemed to be qualified tangible property for the

purposes of paragraph one of subdivision (d) of this section; and in

addition, for the purposes of this subdivision only, property qualifying

under this subparagraph shall be deemed to have been placed in service

for the purposes of paragraph three of subdivision (a) of this section

when a certificate of occupancy is issued for such property.

(4) On-site groundwater remediation costs. The term "on-site

groundwater remediation costs" shall mean all amounts properly

chargeable to a capital account, which are paid or incurred which are

necessary to implement a site's groundwater investigation, remediation,

or qualification for a certificate of completion not already covered

under site preparation costs, and shall include costs of: environmental

consulting; engineering; legal costs; transportation, disposal,

treatment or containment of contaminated groundwater; sheeting, shoring,

and other engineering controls required to prevent off-site migration of

groundwater contamination from the qualified site or migrating onto the

qualified site; and the costs of fencing, temporary electric wiring and

security facilities until such time as the certificate of completion is

issued. On-site groundwater remediation costs shall include all costs

paid or incurred within sixty months after the last day of the tax year

in which the certificate of completion is issued that are necessary for

compliance with the certificate of completion or subsequent

modifications thereof, or the groundwater remedial program defined in

such certificate of completion including but not limited to

institutional controls, engineering controls, an approved site

management plan specific to on-site groundwater remediation, and an

environmental easement with respect to the qualified site. Provided,

however, with respect to any qualified site for which a certificate of

completion has been issued on or after July first, two thousand fifteen

but on or before June twenty-fourth, two thousand twenty-one, on-site

groundwater remediation costs shall include all such costs paid or

incurred within eighty-four months after the last day of the tax year in

which the certificate of completion is issued.

(5) Certificate of completion. A "certificate of completion" issued by

the commissioner of environmental conservation pursuant to section

27-1419 of the environmental conservation law.

(6) Environmental zones (EN-Zones). An "environmental zone" shall mean

an area designated as such by the commissioner of labor. Such areas

shall be census tracts that satisfy either of the following criteria:

(A) areas that have both:

(i) a poverty rate of at least twenty percent based on the most recent

five year American Community Survey; and

(ii) an unemployment rate of at least one and one-quarter times the

statewide unemployment rate based on the most recent five year American

Community Survey, or;

(B) areas that have a poverty rate of at least two times the poverty

rate for the county in which the areas are located based on the most

recent five year American Community Survey.

Such designation shall be made and a list of all such environmental

zones shall be established by the commissioner of labor based on the two

thousand nine through two thousand thirteen American Community Survey

estimate. Upon request of the commissioner of environmental

conservation, the commissioner of labor shall update such designation

based on the most recent American Community Survey, or its successor.

The determination of whether a site is located in an environmental

zone shall be based on the date the department of environmental

conservation issued a notice to the taxpayer that its request for

participation in the brownfield cleanup program has been deemed complete

pursuant to subdivision three of section 27-1407 of the environmental

conservation law.

(c) Qualifying property. Property which qualifies for the credit

provided for under this section and also for a credit provided for (1)

under either subdivision one or subdivision three of section two hundred

ten-B of this chapter, or both, or (2) subsection (a) or subsection (j)

of section six hundred six of this chapter, or both may be the basis for

either the credit provided for under this section or one of the credits

enumerated in paragraph one or two of this subdivision, but not both.

(d) Depreciable property. (1) With respect to qualified tangible

property which is depreciable pursuant to section one hundred

sixty-seven of the internal revenue code but is not subject to the

provisions of section one hundred sixty-eight of such code and which

ceases to be in qualified use prior to the end of the taxable year in

which the credit is to be taken, the amount of the credit shall be that

portion of the credit provided for in this subdivision which represents

the ratio which the months of qualified use bear to the months of useful

life. If property on which credit has been taken ceases to be in

qualified use prior to the end of its useful life, the difference

between the credit taken and the credit allowed for actual use must be

added back in the year in which the property ceased to be in qualified

use. Provided, however, if such property ceases to be in qualified use

after it has been in qualified use for more than twelve consecutive

years, it shall not be necessary to add back the credit as provided in

this paragraph. The amount of credit allowed for actual use shall be

determined by multiplying the original credit by the ratio which the

months of qualified use bear to the months of useful life. For purposes

of this paragraph, the useful life of property shall be the same as the

taxpayer uses for depreciation purposes when computing its federal

income tax liability.

(2) Except with respect to that property to which paragraph four of

this subdivision applies, with respect to qualified tangible property

which is three-year property, as defined in subsection (e) of section

one hundred sixty-eight of the internal revenue code, which ceases to be

in qualified use prior to the end of the taxable year in which the

credit is to be taken, the amount of the credit shall be that portion of

the credit provided for in this section which represents the ratio which

the months of qualified use bear to thirty-six. If property on which

credit has been taken ceases to be in qualified use prior to the end of

thirty-six months, the difference between the credit taken and the

credit allowed for actual use must be added back in the year in which

the property ceased to be in qualified use. The amount of credit allowed

for actual use shall be determined by multiplying the original credit by

the ratio which the months of qualified use bear to thirty-six.

(3) Except with respect to that property to which paragraph four of

this subdivision applies, with respect to qualified tangible property

which is subject to the provisions of section one hundred sixty-eight of

the internal revenue code other than three-year property as defined in

subsection (e) of such section one hundred sixty-eight which ceases to

be in qualified use prior to the end of the taxable year in which the

credit is to be taken, the amount of the credit shall be that portion of

the credit provided for in this section which represents the ratio which

the months of qualified use bear to sixty. If property on which credit

has been taken ceases to be in qualified use prior to the end of sixty

months, the difference between the credit taken and the credit allowed

for actual use must be added back in the year in which the property

ceased to be in qualified use. The amount of credit allowed for actual

use shall be determined by multiplying the original credit by the ratio

which the months of qualified use bear to sixty.

(4) With respect to any qualified tangible property to which section

one hundred sixty-eight of the internal revenue code applies, which is a

building or a structural component of a building and which ceases to be

in qualified use prior to the end of the taxable year in which the

credit is to be taken, the amount of the credit shall be that portion of

the credit provided for in this section which represents the ratio which

the months of qualified use bear to the total number of months over

which the taxpayer chooses to deduct the property under the internal

revenue code. If property on which credit has been taken ceases to be in

qualified use prior to the end of the period over which the taxpayer

chooses to deduct the property under the internal revenue code, the

difference between the credit taken and the credit allowed for actual

use must be added back in the year in which the property ceased to be in

qualified use. Provided, however, if such property ceases to be in

qualified use after it has been in qualified use for more than twelve

consecutive years, it shall not be necessary to add back the credit as

provided in this paragraph. The amount of credit allowed for actual use

shall be determined by multiplying the original credit by the ratio

which the months of qualified use bear to the total number of months

over which the taxpayer chooses to deduct the property under the

internal revenue code.

(e) If the certificate of completion issued to the taxpayer with

respect to a qualified site is revoked by a determination issued

pursuant to section 27-1419 of the environmental conservation law, the

amount of any credit allowed by this section shall be added back in the

taxable year in which such determination is final and no longer subject

to judicial review.

(f) Cross-references. For application of the credit provided for in

this section, see the following provisions of this chapter:

(1) Article 9: Section 187-g

(2) Article 9-A: Section 210-B, subdivision 17

(3) Article 22: Section 606, subsections (i) and (dd)

(4) Article 33: Section 1511, subdivision (u).

* NB There are 2 § 21's