Do Business in New York State Tax-free?
It's possible.
Your business could qualify to become tax-free if it expands in, or relocates to, an Empire Zone (Economic Development Zones). New York State's Empire Zones (EZs) are designated areas throughout the State that offer special incentives to encourage economic development, business investment and job creation. Certified businesses located within a designated zone are eligible to receive significant tax credits and benefits. EZs are comprised of abundant vacant land, existing prime industrial and commercial buildings, skilled workers, ample power and water resources.
Zone Incentives
Qualified Empire Zone Enterprises (QEZEs) are eligible for sales tax exemption, real property and business tax credits for businesses locating and expanding in such zones. The purpose of the Empire Zones Program is to give companies increasing their employment the opportunity to operate on an almost "tax-free" basis for up to 10 years in designated areas of the State, with additional savings available on a declining basis in years 11 through 15.
QEZE Sales Tax Exemptions
Qualified Empire Zone Enterprises (QEZEs) are granted a 10-year exemption from State sales tax on purchases of goods and services (including utility services and owned vehicles) used predominantly in such zones (effective March 1, 2001).
QEZE Credit for Real Property Taxes
Qualified Empire Zone Enterprises are allowed a refundable credit against their business tax equal to a percentage of real property taxes paid based upon increased employment in the zone (effective for taxable years beginning on or after January 1, 2001).
Real Property Tax Abatement
Empire Zones may offer tax abatements from an increased assessment, with the abatement value based on improvements to real property for up to 10 years. This holds true for up to seven years at 100%, decreasing over the last three years of the exemption.
QEZE Tax Reduction Credit
Qualified Empire Zone Enterprises are allowed a credit against their tax equal to a percentage of taxes attributable to the zone enterprise (effective taxable years beginning on or after January 1, 2001).
Wage Tax Credit (WTC)
Credit is available for up to five consecutive years for companies hiring full-time employees in newly created jobs. This credit equals $1,500 per year for new hires. For new hires from targeted special groups, the credit is $3,000 per year, effective 1/1/01.
EZ Investment Tax and Employment Incentives Credit (ITC-EIC)
Businesses that create new jobs and make new investments in production, property and equipment may qualify for tax credits of up to 19% of the company's eligible investment.
New Business Refund
Businesses new to New York State are entitled to a 50% cash refund of unused EZ-WTC and ITC amounts. Other businesses may carry forward unused credits indefinitely.
Utility Rate Savings
Special reduced electric and gas rates may be available through investor-owned utilities in New York State. Businesses that locate or expand their operations in an EZ may receive significantly reduced utility rates.
Zone Capital Credit
A 25% tax credit against personal or corporate income taxes is available for contributing or purchasing shares in a zone capital corporation; or for a direct equity investment in a certified zone business; or for contributions to approved community development projects within an EZ.
Technical Assistance
Each local zone office is staffed with professionals qualified to assist businesses locating or expanding in an EZ.
Additional Information
EZ-4 Form – Application for Modifying an EZ Certified Business
Empire Zone Certification Application Instructions
Empire Zone Certification Application
2008 BAR Form Instructions
2008 BAR Form
2008 Empire Zone & Renewal Community Map
Click here to download the free Adobe Acrobat reader.
For additional information on this or any other BERC program contact:
Kathleen Peterson
Empire Zone Coordinator
920 City Hall
Buffalo, NY 14202
(716) 842-6923
email: kpeterson@berc.org
