Instructions For Form Ct-605 - Claim For Ez Investment Tax Credit And Ez Employment Incentive Credit For The Financial Services Industry - New York State Department Of Taxation And Finance - 2004 Page 3
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4CT-605-I (2004) Page 3 of 4
Column E: Enter your cost or other basis (see Definitions on
Example
page 1). Corporate partners enter your allocable share of the cost
A corporation acquired qualified property in 2003 at a cost of
or other basis in the partnership’s property listed in column A.
$100,000. The EZ-ITC allowed was $10,000.
Line 7a — New York C corporations: Add column E to obtain the
Average number of
EZ-EIC
total cost or other basis of all property claimed in this schedule.
Year
EZ employees
available for use
Multiply this figure by 10% (0.10).
2002
200
—
Line 7b — New York S corporations: Add column E to obtain the
2003
not required
—
total cost or other basis of all property claimed in this schedule.
2004
202
$ 3,000 (30% of $ 10,000)
Multiply this figure by 8% (0.08).
2005
199
0*
2006
205
$ 3,000 (30% of $10,000)
Schedule B — EZ-EIC
* In 2005, the average number of EZ employees was less than
If you acquire, construct, reconstruct, or erect property for which
101% of the number employed in 2002.
an EZ-ITC is allowed, an EZ-EIC may be allowed in the following
three years.
Schedule C — Computation of recapture of EZ-ITC
The amount of the EZ-EIC allowed is 30% of the original EZ-ITC
and EZ-EIC
for each of the three years following the year for which the EZ-ITC
When property on which an EZ-ITC has been allowed is disposed
was originally allowed. However, the credit is allowed only for
of, or ceases to be in qualified use before the end of its useful life,
those years during which your average number of employees
the difference between the credit taken and the credit allowed for
(except general executive officers) in the EZ is at least 101% of
actual use must be added back to the tax otherwise due in the year
the average number of employees (except general executive
of disposition or disqualification. The decertification of a business
officers) in the EZ, during the tax year immediately preceding the
enterprise in an EZ constitutes a disposal or cessation of qualified
tax year for which the original EZ-ITC was allowed.
use on the effective date of the decertification.
If you have claimed an EZ-ITC for property purchased that is
For purposes of the recapture, the termination or expiration of an
principally used by your affiliate, you may also be eligible for an
EZ’s designation as an EZ will not be considered a disposal or
EZ-EIC. In this case, the credit is allowed based on your average
cessation of qualified use.
number of employees in the EZ. The number of the affiliate’s
employees is not taken into consideration.
Section 210.12-B(f) provides different formulas to compute the
amount of EZ-ITC required to be recaptured.
If you did not have a tax year for New York State immediately
preceding the year in which the EZ-ITC is originally allowed, the
1.
For property depreciated under IRC section 167, the formula
average number of employees in the EZ in the tax year in which
is:
the EZ-EIC is claimed must be at least 101% of its average
months of unused life
original EZ-ITC
×
number of employees in the EZ in the tax year in which the EZ-ITC
months of useful life
allowed
was originally allowed.
2.
For three-year property depreciated under IRC section 168,
New York C corporations: The EZ-EIC can reduce the corporate
the formula is:
tax liability to the fixed dollar minimum. Any EZ-EIC that cannot be
used to reduce the current year’s tax liability may be carried over
36 minus the number
to the following year or years.
of months of qualified use
original EZ-ITC
×
allowed
36
A corporation may not claim a refund of the EZ-EIC.
Recapture is only required if the property is disposed of or ceases
Schedule B — Part I — Employment information
to be in qualified use prior to the end of 36 months.
required to determine eligibility for EZ-EIC
3.
For property depreciated under IRC section 168, other than
Complete Part I to determine if you are eligible for the credit. If you
three-year property or buildings or structural components of
are eligible, complete Part II.
buildings, the formula is:
All references to current tax year mean the tax year covered by this
60 minus the number
claim.
of months of qualified use
original EZ-ITC
×
Column A — Enter in column A the current tax year and the base
allowed
60
year. The base year is the year before the year you claimed the
original EZ-ITC. However, if your business was not in operation in
Recapture is only required if the property is disposed of or ceases
New York State during that year, the base year is the year in which
to be in qualified use prior to the end of 60 months.
you claimed the EZ-ITC.
4.
For buildings or structural components of buildings
Columns B, C, D, and E — Enter the total number of employees
depreciated under IRC section 168, the formula is:
employed within the EZ on each of the dates listed that occur
months of unused life
original EZ-ITC
during your tax year.
×
number of months
allowed
Example: A taxpayer filing for a fiscal year beginning
allowed by IRC and
September 1, 2003, and ending August 31, 2004, would enter
used by taxpayer
the number of employees employed in the EZ on the
If qualified property has a useful life of more than 12 years, no
following dates: September 30, 2003, December 31, 2003,
credit need be added back if it has been in use more than 12
March 31, 2004, and June 30, 2004.
consecutive years.
Column G — Unless you have a short tax year, divide the amount
Column G — Enter the total amount of EZ-ITC credit allowed.
in column F by four. If you have a short tax year (a tax year of less
Include the original EZ-ITC but not any EZ-EIC allowed.
than 12 months), divide the amount in column F by the number of
dates shown in columns B through E that occur during the short tax
Column I — Multiply 30% of amount in column H by the number of
year.
years the EZ-EIC was allowed. If the recapture of the EZ-ITC
Column H — Divide the average number of employees covered by
occurred in a prior year, enter 30% of the recaptured EZ-ITC.
this claim by the average number of employees in the base year
Line 11 — In certain instances when an EZ corporation has been
(column G), and carry the result to two decimal places. If the
decertified, the amount of credit to be recaptured must be
percentage in column H is at least 101% (1.01), complete Part II
augmented by an interest charge. For information on how to
below. If the percentage in column H is less than 101%, stop.
compute the augmented recapture amount, see TSB-M-86(13.3)C,
You do not qualify for the employment incentive tax credit for this
(5.3)I, Decertification of Economic Development Zone Business .
year.
Schedule B — Part II — Computation of EZ-EIC
Use Schedule B, Part II, to determine the amount of the EZ-EIC
allowed for each year of eligibility listed in Schedule B, Part I.
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