§ 187-k. Empire zone investment tax credit for agricultural cooperatives. 1. A taxpayer subject to the tax imposed by section one hundred eighty-five of this article shall be allowed a credit, to be computed as herein provided, against the tax imposed by this article if the taxpayer has been certified pursuant to article eighteen-B of the general municipal law. The amount of the credit shall be ten percent 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, described in subdivision two of this section, which is located within an empire zone designated as such pursuant to article eighteen-B of such law, but only if the acquisition, construction, reconstruction or erection of such property occurred or was commenced on or after the date of such designation and prior to the expiration thereof. Provided, however, that in the case of an acquisition, construction, reconstruction or erection which was commenced during such period and continued or completed subsequently, such credit shall be ten percent of the portion of the cost or other basis for federal income tax purposes attributable to such period, which portion shall be ascertained by multiplying such cost or basis by a fraction the numerator of which shall be the expenditures paid or incurred during such period for such purposes and the denominator of which shall be the total of all expenditures paid or incurred for such acquisition, construction, reconstruction or erection. 2. A credit shall be allowed under this section with respect to tangible personal property and other tangible property, including buildings and structural components of buildings, which (i) are depreciable pursuant to section one hundred sixty-seven of the internal revenue code or recovery property with respect to which a deduction is allowable under section one hundred sixty-eight of the internal revenue code, (ii) have a useful life of four years or more, (iii) are acquired by purchase as defined in section one hundred seventy-nine (d) of the internal revenue code, (iv) have a situs in an empire zone designated as such pursuant to article eighteen-B of the general municipal law, and (v) are principally used by the taxpayer in the production of goods by processing, assembling, refining, farming, agriculture, horticulture, floriculture or viticulture. Property used in the production of goods shall include machinery, equipment or other tangible property which is principally used in the repair and service of other machinery, equipment or other tangible property used principally in the production of goods and shall include all facilities used in the production operation, including storage of material to be used in production and of the products that are produced. For purposes of this section, the term "goods" shall not include electricity. 3. A taxpayer shall not be allowed a credit under this section with respect to any tangible personal property and other tangible property, including buildings and structural components of buildings, which it leases to any other person or corporation. For purposes of the preceding sentence, any contract or agreement to lease or rent or for a license to use such property shall be considered a lease. Provided, however, in determining whether a taxpayer shall be allowed a credit under this section with respect to such property, any election made with respect to such property pursuant to the provisions of paragraph eight of subsection (f) of section one hundred sixty-eight of the internal revenue code, as such paragraph was in effect for agreements entered into prior to January first, nineteen hundred eighty-four, shall be disregarded. 4. (i) The credit allowed under this section for any taxable year shall not reduce the tax due for such year to less than the minimum taxprescribed in subdivision two of section one hundred eighty-five of this article. Provided, however, that if the amount of credit allowable under this section for any taxable year reduces the tax to such minimum tax, any amount of credit not deductible in such taxable year may be carried over to the following year or years and may be deducted from the taxpayer's tax for such year or years. In lieu of such carryover, any such taxpayer which qualifies as a new business under paragraph (ii) of this subdivision may elect, on its report for its taxable year with respect to which such credit is allowed, to treat fifty percent of the amount of such carryover as an overpayment of tax to be credited or refunded in accordance with the provisions of section one thousand eighty-six of this chapter. Provided, however, the provisions of subsection (c) of section one thousand eighty-eight of this chapter notwithstanding, no interest shall be paid thereon. (ii) For purposes of this subdivision, a new business shall include any corporation subject to tax under section one hundred eighty-five of this article, except a corporation which: (I) over fifty percent of the number of shares or amount of the membership capital entitling the holders thereof to vote for the election of directors is owned or controlled, either directly or indirectly, by a taxpayer subject to tax under section one hundred eighty-three, one hundred eighty-four or one hundred eighty-five of this article; article nine-A, article thirty-two or article thirty-three of this chapter; or (II) is substantially similar in operation and in ownership to a business entity (or entities) taxable, or previously taxable, under section one hundred eighty-three, one hundred eighty-four, one hundred eighty-five or one hundred eighty-six of this article; article nine-A, thirty-two or thirty-three of this chapter; article twenty-three of this chapter or would have been subject to tax under such article twenty-three (as such article was in effect on January first, nineteen hundred eighty) or the income (or losses) of which is (or was) includable under article twenty-two of this chapter whereby the intent and purpose of this subdivision with respect to refunding a credit to new business would be evaded; or (III) has been subject to tax under section one hundred eighty-five of this article for more than five taxable years (excluding short taxable years). 5. (a) With respect to property which is depreciable pursuant to section one hundred sixty-seven of the internal revenue code and which is disposed of or 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 months of useful life. If property on which credit has been taken is disposed of or 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 of disposition. Provided, however, if such property is disposed of or 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 subparagraph. 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 subdivision, useful life of property shall be the same as the taxpayer uses for depreciation purposes when computing his federal income tax liability.(b) Except with respect to that property to which paragraph (d) of this subdivision applies, with respect to three-year property, as defined in paragraph two of subsection (c) of section one hundred sixty-eight of the internal revenue code, which is disposed of or 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 is disposed of or 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 of disposition. 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. (c) Except with respect to that property to which paragraph (d) of this subdivision applies, with respect to five-year property and ten-year property, as defined in paragraph two of subsection (c) of section one hundred sixty-eight of the internal revenue code, fifteen-year real property, as defined in such paragraph as it was in effect for property placed in service after December thirty-first, nineteen hundred eighty in taxable years ending after such date, eighteen-year real property, as defined in such paragraph as it was in effect for property placed in service after March fifteenth, nineteen hundred eighty-four, and nineteen-year real property, as defined in such paragraph, which is disposed of or 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 is disposed of or 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 of disposition. 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. (d) With respect to any recovery 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 is disposed of or 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 section one hundred sixty-eight of the internal revenue code. If property on which credit has been taken is disposed of or ceases to be in qualified use prior to the end of the period over which the taxpayer chooses to deduct the property under section one hundred sixty-eight of the internal revenue code, the difference between the credit taken and the credit allowed for actual use must be added back in the year of disposition. Provided, however, if such property is disposed of or 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 section one hundred sixty-eight of the internal revenue code.(e) For purposes of this subdivision, disposal or cessation of qualified use shall not be deemed to have occurred solely by reason of the termination or expiration of an empire zone's designation as such. (f)(I) For purposes of this subdivision, the decertification of a business enterprise with respect to an empire zone shall constitute a disposal or cessation of qualified use of the property on which the credit was taken which is located in the zone to which the decertification applies, on the effective date of such decertification. (II) Where a business enterprise has been decertified based on a finding pursuant to clause one, two, or five of subdivision (a) of section nine hundred fifty-nine of the general municipal law, the amount required to be added back by reason of this subdivision shall be augmented by an amount equal to the product of the amount of credit, with respect to property which is disposed of or ceases to be in qualified use, which was deducted from the taxpayer's tax otherwise due under this article for all prior taxable years (subject to the limit set forth in this subparagraph) and the underpayment rate of interest (without regard to compounding) set by the commissioner of taxation and finance pursuant to subdivision (e) of section one thousand ninety-six of this chapter, in effect on the last day of the taxable year. The limit shall be (i) the amount of credit, with respect to the property which is disposed of or ceases to be in qualified use, which was deducted from the taxpayer's tax otherwise due under this article for all prior taxable years, reduced (but not below zero) by (ii) the credit allowed for actual use. For purposes of this subparagraph, the attribution to specific property of credit amounts deducted from tax shall be established in accordance with the date of placement in service of such property in the empire zone. (III) Notwithstanding any other provision of this section, in the case of a business enterprise which has been decertified, any amount of credit allowed with respect to the property of such business enterprise located in the zone to which the decertification applies which is carried over pursuant to subdivision four of this section shall not be carried over beyond the seventh taxable year next following the taxable year with respect to which the credit provided for in this section was allowed.
§ 187-k. Empire zone investment tax credit for agricultural cooperatives. 1. A taxpayer subject to the tax imposed by section one hundred eighty-five of this article shall be allowed a credit, to be computed as herein provided, against the tax imposed by this article if the taxpayer has been certified pursuant to article eighteen-B of the general municipal law. The amount of the credit shall be ten percent 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, described in subdivision two of this section, which is located within an empire zone designated as such pursuant to article eighteen-B of such law, but only if the acquisition, construction, reconstruction or erection of such property occurred or was commenced on or after the date of such designation and prior to the expiration thereof. Provided, however, that in the case of an acquisition, construction, reconstruction or erection which was commenced during such period and continued or completed subsequently, such credit shall be ten percent of the portion of the cost or other basis for federal income tax purposes attributable to such period, which portion shall be ascertained by multiplying such cost or basis by a fraction the numerator of which shall be the expenditures paid or incurred during such period for such purposes and the denominator of which shall be the total of all expenditures paid or incurred for such acquisition, construction, reconstruction or erection. 2. A credit shall be allowed under this section with respect to tangible personal property and other tangible property, including buildings and structural components of buildings, which (i) are depreciable pursuant to section one hundred sixty-seven of the internal revenue code or recovery property with respect to which a deduction is allowable under section one hundred sixty-eight of the internal revenue code, (ii) have a useful life of four years or more, (iii) are acquired by purchase as defined in section one hundred seventy-nine (d) of the internal revenue code, (iv) have a situs in an empire zone designated as such pursuant to article eighteen-B of the general municipal law, and (v) are principally used by the taxpayer in the production of goods by processing, assembling, refining, farming, agriculture, horticulture, floriculture or viticulture. Property used in the production of goods shall include machinery, equipment or other tangible property which is principally used in the repair and service of other machinery, equipment or other tangible property used principally in the production of goods and shall include all facilities used in the production operation, including storage of material to be used in production and of the products that are produced. For purposes of this section, the term "goods" shall not include electricity. 3. A taxpayer shall not be allowed a credit under this section with respect to any tangible personal property and other tangible property, including buildings and structural components of buildings, which it leases to any other person or corporation. For purposes of the preceding sentence, any contract or agreement to lease or rent or for a license to use such property shall be considered a lease. Provided, however, in determining whether a taxpayer shall be allowed a credit under this section with respect to such property, any election made with respect to such property pursuant to the provisions of paragraph eight of subsection (f) of section one hundred sixty-eight of the internal revenue code, as such paragraph was in effect for agreements entered into prior to January first, nineteen hundred eighty-four, shall be disregarded. 4. (i) The credit allowed under this section for any taxable year shall not reduce the tax due for such year to less than the minimum taxprescribed in subdivision two of section one hundred eighty-five of this article. Provided, however, that if the amount of credit allowable under this section for any taxable year reduces the tax to such minimum tax, any amount of credit not deductible in such taxable year may be carried over to the following year or years and may be deducted from the taxpayer's tax for such year or years. In lieu of such carryover, any such taxpayer which qualifies as a new business under paragraph (ii) of this subdivision may elect, on its report for its taxable year with respect to which such credit is allowed, to treat fifty percent of the amount of such carryover as an overpayment of tax to be credited or refunded in accordance with the provisions of section one thousand eighty-six of this chapter. Provided, however, the provisions of subsection (c) of section one thousand eighty-eight of this chapter notwithstanding, no interest shall be paid thereon. (ii) For purposes of this subdivision, a new business shall include any corporation subject to tax under section one hundred eighty-five of this article, except a corporation which: (I) over fifty percent of the number of shares or amount of the membership capital entitling the holders thereof to vote for the election of directors is owned or controlled, either directly or indirectly, by a taxpayer subject to tax under section one hundred eighty-three, one hundred eighty-four or one hundred eighty-five of this article; article nine-A, article thirty-two or article thirty-three of this chapter; or (II) is substantially similar in operation and in ownership to a business entity (or entities) taxable, or previously taxable, under section one hundred eighty-three, one hundred eighty-four, one hundred eighty-five or one hundred eighty-six of this article; article nine-A, thirty-two or thirty-three of this chapter; article twenty-three of this chapter or would have been subject to tax under such article twenty-three (as such article was in effect on January first, nineteen hundred eighty) or the income (or losses) of which is (or was) includable under article twenty-two of this chapter whereby the intent and purpose of this subdivision with respect to refunding a credit to new business would be evaded; or (III) has been subject to tax under section one hundred eighty-five of this article for more than five taxable years (excluding short taxable years). 5. (a) With respect to property which is depreciable pursuant to section one hundred sixty-seven of the internal revenue code and which is disposed of or 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 months of useful life. If property on which credit has been taken is disposed of or 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 of disposition. Provided, however, if such property is disposed of or 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 subparagraph. 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 subdivision, useful life of property shall be the same as the taxpayer uses for depreciation purposes when computing his federal income tax liability.(b) Except with respect to that property to which paragraph (d) of this subdivision applies, with respect to three-year property, as defined in paragraph two of subsection (c) of section one hundred sixty-eight of the internal revenue code, which is disposed of or 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 is disposed of or 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 of disposition. 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. (c) Except with respect to that property to which paragraph (d) of this subdivision applies, with respect to five-year property and ten-year property, as defined in paragraph two of subsection (c) of section one hundred sixty-eight of the internal revenue code, fifteen-year real property, as defined in such paragraph as it was in effect for property placed in service after December thirty-first, nineteen hundred eighty in taxable years ending after such date, eighteen-year real property, as defined in such paragraph as it was in effect for property placed in service after March fifteenth, nineteen hundred eighty-four, and nineteen-year real property, as defined in such paragraph, which is disposed of or 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 is disposed of or 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 of disposition. 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. (d) With respect to any recovery 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 is disposed of or 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 section one hundred sixty-eight of the internal revenue code. If property on which credit has been taken is disposed of or ceases to be in qualified use prior to the end of the period over which the taxpayer chooses to deduct the property under section one hundred sixty-eight of the internal revenue code, the difference between the credit taken and the credit allowed for actual use must be added back in the year of disposition. Provided, however, if such property is disposed of or 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 section one hundred sixty-eight of the internal revenue code.(e) For purposes of this subdivision, disposal or cessation of qualified use shall not be deemed to have occurred solely by reason of the termination or expiration of an empire zone's designation as such. (f)(I) For purposes of this subdivision, the decertification of a business enterprise with respect to an empire zone shall constitute a disposal or cessation of qualified use of the property on which the credit was taken which is located in the zone to which the decertification applies, on the effective date of such decertification. (II) Where a business enterprise has been decertified based on a finding pursuant to clause one, two, or five of subdivision (a) of section nine hundred fifty-nine of the general municipal law, the amount required to be added back by reason of this subdivision shall be augmented by an amount equal to the product of the amount of credit, with respect to property which is disposed of or ceases to be in qualified use, which was deducted from the taxpayer's tax otherwise due under this article for all prior taxable years (subject to the limit set forth in this subparagraph) and the underpayment rate of interest (without regard to compounding) set by the commissioner of taxation and finance pursuant to subdivision (e) of section one thousand ninety-six of this chapter, in effect on the last day of the taxable year. The limit shall be (i) the amount of credit, with respect to the property which is disposed of or ceases to be in qualified use, which was deducted from the taxpayer's tax otherwise due under this article for all prior taxable years, reduced (but not below zero) by (ii) the credit allowed for actual use. For purposes of this subparagraph, the attribution to specific property of credit amounts deducted from tax shall be established in accordance with the date of placement in service of such property in the empire zone. (III) Notwithstanding any other provision of this section, in the case of a business enterprise which has been decertified, any amount of credit allowed with respect to the property of such business enterprise located in the zone to which the decertification applies which is carried over pursuant to subdivision four of this section shall not be carried over beyond the seventh taxable year next following the taxable year with respect to which the credit provided for in this section was allowed.
§ 187-k. Empire zone investment tax credit for agricultural cooperatives. 1. A taxpayer subject to the tax imposed by section one hundred eighty-five of this article shall be allowed a credit, to be computed as herein provided, against the tax imposed by this article if the taxpayer has been certified pursuant to article eighteen-B of the general municipal law. The amount of the credit shall be ten percent 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, described in subdivision two of this section, which is located within an empire zone designated as such pursuant to article eighteen-B of such law, but only if the acquisition, construction, reconstruction or erection of such property occurred or was commenced on or after the date of such designation and prior to the expiration thereof. Provided, however, that in the case of an acquisition, construction, reconstruction or erection which was commenced during such period and continued or completed subsequently, such credit shall be ten percent of the portion of the cost or other basis for federal income tax purposes attributable to such period, which portion shall be ascertained by multiplying such cost or basis by a fraction the numerator of which shall be the expenditures paid or incurred during such period for such purposes and the denominator of which shall be the total of all expenditures paid or incurred for such acquisition, construction, reconstruction or erection. 2. A credit shall be allowed under this section with respect to tangible personal property and other tangible property, including buildings and structural components of buildings, which (i) are depreciable pursuant to section one hundred sixty-seven of the internal revenue code or recovery property with respect to which a deduction is allowable under section one hundred sixty-eight of the internal revenue code, (ii) have a useful life of four years or more, (iii) are acquired by purchase as defined in section one hundred seventy-nine (d) of the internal revenue code, (iv) have a situs in an empire zone designated as such pursuant to article eighteen-B of the general municipal law, and (v) are principally used by the taxpayer in the production of goods by processing, assembling, refining, farming, agriculture, horticulture, floriculture or viticulture. Property used in the production of goods shall include machinery, equipment or other tangible property which is principally used in the repair and service of other machinery, equipment or other tangible property used principally in the production of goods and shall include all facilities used in the production operation, including storage of material to be used in production and of the products that are produced. For purposes of this section, the term "goods" shall not include electricity. 3. A taxpayer shall not be allowed a credit under this section with respect to any tangible personal property and other tangible property, including buildings and structural components of buildings, which it leases to any other person or corporation. For purposes of the preceding sentence, any contract or agreement to lease or rent or for a license to use such property shall be considered a lease. Provided, however, in determining whether a taxpayer shall be allowed a credit under this section with respect to such property, any election made with respect to such property pursuant to the provisions of paragraph eight of subsection (f) of section one hundred sixty-eight of the internal revenue code, as such paragraph was in effect for agreements entered into prior to January first, nineteen hundred eighty-four, shall be disregarded. 4. (i) The credit allowed under this section for any taxable year shall not reduce the tax due for such year to less than the minimum taxprescribed in subdivision two of section one hundred eighty-five of this article. Provided, however, that if the amount of credit allowable under this section for any taxable year reduces the tax to such minimum tax, any amount of credit not deductible in such taxable year may be carried over to the following year or years and may be deducted from the taxpayer's tax for such year or years. In lieu of such carryover, any such taxpayer which qualifies as a new business under paragraph (ii) of this subdivision may elect, on its report for its taxable year with respect to which such credit is allowed, to treat fifty percent of the amount of such carryover as an overpayment of tax to be credited or refunded in accordance with the provisions of section one thousand eighty-six of this chapter. Provided, however, the provisions of subsection (c) of section one thousand eighty-eight of this chapter notwithstanding, no interest shall be paid thereon. (ii) For purposes of this subdivision, a new business shall include any corporation subject to tax under section one hundred eighty-five of this article, except a corporation which: (I) over fifty percent of the number of shares or amount of the membership capital entitling the holders thereof to vote for the election of directors is owned or controlled, either directly or indirectly, by a taxpayer subject to tax under section one hundred eighty-three, one hundred eighty-four or one hundred eighty-five of this article; article nine-A, article thirty-two or article thirty-three of this chapter; or (II) is substantially similar in operation and in ownership to a business entity (or entities) taxable, or previously taxable, under section one hundred eighty-three, one hundred eighty-four, one hundred eighty-five or one hundred eighty-six of this article; article nine-A, thirty-two or thirty-three of this chapter; article twenty-three of this chapter or would have been subject to tax under such article twenty-three (as such article was in effect on January first, nineteen hundred eighty) or the income (or losses) of which is (or was) includable under article twenty-two of this chapter whereby the intent and purpose of this subdivision with respect to refunding a credit to new business would be evaded; or (III) has been subject to tax under section one hundred eighty-five of this article for more than five taxable years (excluding short taxable years). 5. (a) With respect to property which is depreciable pursuant to section one hundred sixty-seven of the internal revenue code and which is disposed of or 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 months of useful life. If property on which credit has been taken is disposed of or 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 of disposition. Provided, however, if such property is disposed of or 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 subparagraph. 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 subdivision, useful life of property shall be the same as the taxpayer uses for depreciation purposes when computing his federal income tax liability.(b) Except with respect to that property to which paragraph (d) of this subdivision applies, with respect to three-year property, as defined in paragraph two of subsection (c) of section one hundred sixty-eight of the internal revenue code, which is disposed of or 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 is disposed of or 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 of disposition. 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. (c) Except with respect to that property to which paragraph (d) of this subdivision applies, with respect to five-year property and ten-year property, as defined in paragraph two of subsection (c) of section one hundred sixty-eight of the internal revenue code, fifteen-year real property, as defined in such paragraph as it was in effect for property placed in service after December thirty-first, nineteen hundred eighty in taxable years ending after such date, eighteen-year real property, as defined in such paragraph as it was in effect for property placed in service after March fifteenth, nineteen hundred eighty-four, and nineteen-year real property, as defined in such paragraph, which is disposed of or 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 is disposed of or 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 of disposition. 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. (d) With respect to any recovery 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 is disposed of or 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 section one hundred sixty-eight of the internal revenue code. If property on which credit has been taken is disposed of or ceases to be in qualified use prior to the end of the period over which the taxpayer chooses to deduct the property under section one hundred sixty-eight of the internal revenue code, the difference between the credit taken and the credit allowed for actual use must be added back in the year of disposition. Provided, however, if such property is disposed of or 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 section one hundred sixty-eight of the internal revenue code.(e) For purposes of this subdivision, disposal or cessation of qualified use shall not be deemed to have occurred solely by reason of the termination or expiration of an empire zone's designation as such. (f)(I) For purposes of this subdivision, the decertification of a business enterprise with respect to an empire zone shall constitute a disposal or cessation of qualified use of the property on which the credit was taken which is located in the zone to which the decertification applies, on the effective date of such decertification. (II) Where a business enterprise has been decertified based on a finding pursuant to clause one, two, or five of subdivision (a) of section nine hundred fifty-nine of the general municipal law, the amount required to be added back by reason of this subdivision shall be augmented by an amount equal to the product of the amount of credit, with respect to property which is disposed of or ceases to be in qualified use, which was deducted from the taxpayer's tax otherwise due under this article for all prior taxable years (subject to the limit set forth in this subparagraph) and the underpayment rate of interest (without regard to compounding) set by the commissioner of taxation and finance pursuant to subdivision (e) of section one thousand ninety-six of this chapter, in effect on the last day of the taxable year. The limit shall be (i) the amount of credit, with respect to the property which is disposed of or ceases to be in qualified use, which was deducted from the taxpayer's tax otherwise due under this article for all prior taxable years, reduced (but not below zero) by (ii) the credit allowed for actual use. For purposes of this subparagraph, the attribution to specific property of credit amounts deducted from tax shall be established in accordance with the date of placement in service of such property in the empire zone. (III) Notwithstanding any other provision of this section, in the case of a business enterprise which has been decertified, any amount of credit allowed with respect to the property of such business enterprise located in the zone to which the decertification applies which is carried over pursuant to subdivision four of this section shall not be carried over beyond the seventh taxable year next following the taxable year with respect to which the credit provided for in this section was allowed.
