§ 606. Credits against tax.
 
 
 (a) Investment tax credit (ITC). (1) A
 taxpayer shall be allowed a credit, to be computed as hereinafter
 provided, against the tax imposed by this article. The amount of the
 credit shall be the per cent provided for hereinbelow of the investment
 credit base. The investment credit base is 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 paragraph two of this subsection, less the
 amount of the nonqualified nonrecourse financing with respect to such
 property to the extent such financing would be excludible from the
 credit base pursuant to section 46(c)(8) of the internal revenue code
 (treating such property as section thirty-eight property irrespective of
 whether or not it in fact constitutes section thirty-eight property).
 If, at the close of a taxable year following the taxable year in which
 such property was placed in service, there is a net decrease in the
 amount of nonqualified nonrecourse financing with respect to such
 property, such net decrease shall be treated as if it were the cost or
 other basis of property described in paragraph two of this subsection
 acquired, constructed, reconstructed or erected during the year of the
 decrease in the amount of nonqualified nonrecourse financing. The
 percentage to be used to compute the credit allowed pursuant to this
 subsection shall be that percentage appearing in column two which is
 opposite the appropriate period in column one in which the tangible
 personal property was acquired, constructed, reconstructed or erected,
 as the case may be:
 
 Column 1 Column 2
 After December 31, 1968 and
 prior to January 1, 1974 one per cent
 After December 31, 1973 and
 prior to January 1, 1978 two per cent
 After December 31, 1977 and
 prior to January 1, 1979 three per cent
 After December 31, 1978 and
 prior to June 1, 1981 four per cent
 After May 31, 1981 and
 prior to July 1, 1982 five per cent
 After June 30, 1982 and
 before January 1, 1987 six per cent
 After December 31, 1986 four per cent, except that in the
 case of research and development
 property the applicable percentage
 shall be seven
 
 Provided, however, that in the case of an acquisition, construction,
 reconstruction or erection which was commenced in any one period and
 continued or completed in any subsequent period the credit shall be the
 sum of the portions of the investment credit base attributable to each
 such period, which portion with respect to each such period shall be
 ascertained by multiplying such investment credit base 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, multiplied by the allowable
 percentage for each such period.
 (2)(A) A credit shall be allowed under this subsection with respect to
 tangible personal property and other tangible property, including
 buildings and structural components of buildings, which are: depreciable
 pursuant to section one hundred sixty-seven of the internal revenue
 code, have a useful life of four years or more, are acquired by purchase
 as defined in section one hundred seventy-nine (d) of the internal
 revenue code, have a situs in this state and are (i) principally used by
 the taxpayer in the production of goods by manufacturing, processing,
 assembling, refining, mining, extracting, farming, agriculture,
 horticulture, floriculture, viticulture or commercial fishing, (ii)
 industrial waste treatment facilities or air pollution control
 facilities, used in the taxpayer's trade or business, (iii) research and
 development property, (iv) principally used in the ordinary course of
 the taxpayer's trade or business as a broker or dealer in connection
 with the purchase or sale (which shall include but not be limited to the
 issuance, entering into, assumption, offset, assignment, termination, or
 transfer) of stocks, bonds or other securities as defined in section
 four hundred seventy-five (c)(2) of the Internal Revenue Code, or of
 commodities as defined in section 475(e) of the Internal Revenue Code,
 (v) principally used in the ordinary course of the taxpayer's trade or
 business of providing investment advisory services for a regulated
 investment company as defined in section eight hundred fifty-one of the
 Internal Revenue Code, or lending, loan arrangement or loan origination
 services to customers in connection with the purchase or sale (which
 shall include but not be limited to the issuance, entering into,
 assumption, offset, assignment, termination, or transfer) of securities
 as defined in section four hundred seventy-five (c)(2) of the Internal
 Revenue Code, or (vi) principally used as a qualified film production
 facility including qualified film production facilities having a situs
 in an empire zone designated as such pursuant to article eighteen-B of
 the general municipal law, where the taxpayer is providing three or more
 services to any qualified film production company using the facility,
 including such services as a studio lighting grid, lighting and grip
 equipment, multi-line phone service, broadband information technology
 access, industrial scale electrical capacity, food services, security
 services, and heating, ventilation and air conditioning. For purposes of
 clauses (iv) and (v) of this subparagraph, property purchased by a
 taxpayer affiliated with a regulated broker, dealer, or registered
 investment adviser is allowed a credit under this subsection if the
 property is used by its affiliated regulated broker, dealer or
 registered investment adviser in accordance with this subsection. For
 purposes of determining if the property is principally used in
 qualifying uses, the uses by the taxpayer described in clauses (iv) and
 (v) of this subparagraph may be aggregated. In addition, the uses by the
 taxpayer, its affiliated regulated broker, dealer and registered
 investment adviser under either or both of those clauses may be
 aggregated. Provided, however, a taxpayer shall not be allowed the
 credit provided by clauses (iv) and (v) of this subparagraph unless (I)
 eighty percent or more of the employees performing the administrative
 and support functions resulting from or related to the qualifying uses
 of such equipment are located in this state, or (II) the average number
 of employees that perform the administrative and support functions
 resulting from or related to the qualifying uses of such equipment and
 are located in this state during the taxable year for which the credit
 is claimed is equal to or greater than ninety-five percent of the
 average number of employees that perform these functions and are located
 in this state during the thirty-six months immediately preceding the
 year for which the credit is claimed, or (III) the number of employees
 located in this state during the taxable year for which the credit is
 claimed is equal to or greater than ninety percent of the number of
 employees located in this state on December thirty-first, nineteen
 hundred ninety-eight or, if the taxpayer was not a calendar year
 taxpayer in nineteen hundred ninety-eight, the last day of its first
 taxable year ending after December thirty-first, nineteen hundred
 ninety-eight. If the taxpayer becomes subject to tax in this state after
 the taxable year beginning in nineteen hundred ninety-eight, then the
 taxpayer is not required to satisfy the employment test provided in the
 preceding sentence of this subparagraph for its first taxable year. For
 the purposes of clause (III) of this subparagraph the employment test
 will be based on the number of employees located in this state on the
 last day of the first taxable year the taxpayer is subject to tax in
 this state. If the uses of the property must be aggregated to determine
 whether the property is principally used in qualifying uses, then either
 each affiliate using the property must satisfy this employment test or
 this employment test must be satisfied through the aggregation of the
 employees of the taxpayer, its affiliated regulated broker, dealer, and
 registered investment adviser using the property. For purposes of this
 subsection, the term "goods" shall not include electricity.
 (B) For purposes of this paragraph, the following definitions shall
 apply:
 (i) Manufacturing shall mean the process of working raw materials into
 wares suitable for use or which gives new shapes, new quality or new
 combinations to matter which already has gone through some artificial
 process by the use of machinery, tools, appliances and other similar
 equipment. 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.
 (ii) Research and development property shall mean property which is
 used for purposes of research and development in the experimental or
 laboratory sense. Such purposes shall not be deemed to include the
 ordinary testing or inspection of materials or products for quality
 control, efficiency surveys, management studies, consumer surveys,
 advertising, promotions, or research in connection with literary,
 historical or similar projects.
 (iii) Industrial waste treatment facilities shall mean property
 constituting facilities for the treatment, neutralization or
 stabilization of industrial waste and other wastes (as the terms
 "industrial waste" and "other wastes" are defined in section 17-0105 of
 the environmental conservation law) from a point immediately preceding
  the point of such treatment, neutralization or stabilization to the
 point of disposal, including the necessary pumping and transmitting
 facilities, but excluding such facilities installed for the primary
 purpose of salvaging materials which are usable in the manufacturing
 process or are marketable.
 (iv) Air pollution control facilities shall mean property constituting
 facilities which remove, reduce, or render less noxious air contaminants
 emitted from an air contamination source (as the terms "air contaminant"
 and "air contamination source" are defined in section 19-0107 of the
 environmental conservation law) from a point immediately preceding the
 point of such removal, reduction or rendering to the point of discharge
 of air, meeting emission standards as established by the department of
 environmental conservation, but excluding such facilities installed for
 the primary purpose of salvaging materials which are usable in the
 manufacturing process or are marketable and excluding those facilities
 which rely for their efficacy on dilution, dispersion or assimilation of
 air contaminants in the ambient air after emission. Such term shall
 further include flue gas desulfurization equipment and attendant sludge
 disposal facilities, fluidized bed boilers, precombustion coal cleaning
 facilities or other facilities that conform with this subsection and
 which comply with the provisions of the State Acid Deposition Control
 Act set forth in title nine of article nineteen of the environmental
 conservation law.
 (v) For purposes of this paragraph, the terms "qualified film
 production facility" and "qualified film production company" shall have
 the same meaning as in section twenty-four of this chapter.
 (C) However, such credit shall be allowed with respect to industrial
 waste treatment facilities and air pollution control facilities only on
 condition that such facilities have been certified  by the state
 commissioner of environmental conservation or his designated
 representative, pursuant to subdivision one of section 17-0707 or
 subdivision one of section 19-0309 of the environmental conservation
 law, as complying with applicable provisions of the environmental
 conservation law, the public health law, the state sanitary code and
 codes, rules, regulations, permits or orders issued pursuant thereto.
 (3) A taxpayer shall not be allowed a credit under this subsection
 with respect to any property described in clause (i) of subparagraph (B)
 of paragraph two hereof if such property qualifies for the modification
 allowed under either paragraph three or paragraph four of subsection (g)
 of section six hundred twelve whether or not such amount shall have been
 subtracted. Provided, however, with respect to property which qualifies
 for a modification under either clause (A), (B) or (C) of paragraph four
 of subsection (g) because such property was ordered on or before
 December thirty-first, nineteen hundred sixty-eight, but with respect to
 which no expenditure has been paid or incurred at such date, the
 taxpayer may elect to subtract the amount allowable under clauses (A),
 (B) or (C) or may take the credit provided by this subsection, but not
 both.
 (4) A taxpayer shall not be allowed a credit under this subsection
 with respect to tangible personal property and other tangible property,
 including buildings and structural components of buildings, which it
 leases to any other person or corporation except where a taxpayer leases
 property to an affiliated regulated broker, dealer, or registered
 investment adviser that uses such property in accordance with clause
 (iv) or (v) of subparagraph (A) of paragraph two of this subsection. 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 subsection 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. For purposes  of this
 paragraph, the use of a qualified film production facility by a
 qualified film production company shall not be considered a lease of
 such facility to such company.
 (5) If the amount of credit allowable under this subsection for any
 taxable year shall exceed the taxpayer's tax for such year, the excess
 allowed for a taxable year commencing prior to January first, nineteen
 hundred eighty-seven may be carried over to the following year or years
 and may be deducted from the taxpayer's tax for such year or years, but
 in no event shall such credit be carried over to taxable years
 commencing on or after January first, nineteen hundred ninety-seven, and
 any amount of credit allowed for a taxable year commencing on or after
 January first, nineteen hundred eighty-seven and not deductible in such
 year may be carried over to the ten taxable years next following such
 taxable year and may be deducted from the taxpayer's tax for such year
 or years. In lieu of carrying over any such excess, a taxpayer who
 qualifies as an owner of a new business for purposes of paragraph ten of
 this subsection may, at his option, receive such excess as a refund. Any
 refund paid pursuant to this paragraph shall be deemed to be a refund of
 an overpayment of tax as provided in section six hundred eighty-six of
 this article, provided, however, that no interest shall be paid thereon.
 (6) At the option of the taxpayer for taxable years  commencing prior
 to January first, nineteen hundred eighty-seven, air or water pollution
 control facilities which qualify for elective modifications under
 subsection (h) of section six hundred twelve, or research and
 development facilities which qualify for elective modifications under
 paragraphs two and four of subsection (g) of section six hundred twelve
 may be treated as property principally used by the taxpayer in the
 production of goods by manufacturing, processing, assembling, refining,
 mining, extracting, farming, agriculture, horticulture, floriculture,
 viticulture or commercial fishing, provided the property otherwise
 qualifies under paragraph two of this subsection, in which event, a
 modification shall not be allowed under such subsection (h) and under
 such paragraphs two and four of subsection (g).
 (7) (A) With respect to 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 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 subsection 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 subparagraph, 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 subparagraph (D) of
 this paragraph applies, with respect to three-year property, as defined
 in subsection (e) 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 subsection 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 subparagraph (D) of
 this paragraph applies, with respect to property 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 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 subsection 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 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 subsection 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 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 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 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 total
 number of months over which the taxpayer chooses to deduct the property
 under the internal revenue code.
 (E) For purposes of this paragraph, property (i) which is described in
 subparagraph (B), (C) or (D) of this paragraph, and (ii) which is
 subject to paragraph twenty-six of subsection (c) and paragraph
 twenty-five of subsection (b) of section six hundred twelve of this
 chapter, shall be treated as property which is depreciable pursuant to
 section one hundred sixty-seven of the internal revenue code but is not
 subject to section one hundred sixty-eight of such code.
 (F) For purposes of this paragraph, where a credit is allowed with
 respect to an air pollution control facility on the basis of a
 certificate of compliance issued pursuant to the environmental
 conservation law and the certificate is revoked pursuant to subdivision
 three of section 19-0309 of the environmental conservation  law, such
 revocation shall constitute a disposal or cessation of qualified use,
 unless such facility is described in clause (i) or (iii) of subparagraph
 (A) of paragraph two of this subsection. Also for purposes of this
 subparagraph, the use of an air pollution control facility or an
 industrial waste treatment facility for the primary purpose of salvaging
 materials which are usable in the manufacturing process or are
 marketable shall constitute a cessation of qualified use, unless such
 facility is described in clause (i) or (iii) of subparagraph (A) of
 paragraph two of this subsection.
 (G) For taxable years commencing on or after January first, nineteen
 hundred eighty-seven, the amount required to be added back pursuant to
 this paragraph shall be augmented by an amount equal to the product of
 such amount and the underpayment rate of interest (without regard to
 compounding), set by the commissioner pursuant to subsection (j) of
 section six hundred ninety-seven, in effect on the last day of the
 taxable year.
 (H) If, as of the close of the taxable year, there is a net increase
 with respect to the taxpayer in the amount of  nonqualified nonrecourse
 financing (within the meaning of section 46(c) (8) of the internal
 revenue code) with respect to any property with respect to which the
 credit under this subsection was limited based on attributable
 nonqualified nonrecourse financing, then an amount equal to the decrease
 in such credit which would have resulted from reducing, by the amount of
 such net increase, the cost or other basis taken into account with
 respect to such property must be added back in such taxable year. The
 amount of nonqualified nonrecourse financing shall not be treated as
 increased by reason of a transfer of (or agreement to transfer) any
 evidence of an indebtedness if such transfer occurs (or such agreement
 is entered into) more than one year after the date such indebtedness was
 incurred.
 (10) For purposes of paragraph five of this subsection, an individual
 who is either a sole proprietor or a member of a partnership shall
 qualify as an owner of a new business unless:
 (A) the business of which the individual is an owner is substantially
 similar in operation and in ownership to a business entity taxable, or
 previously taxable, under section one hundred eighty-three, one hundred
 eighty-four, one hundred eighty-five or one hundred eighty-six of
 article nine; article nine-A, thirty-two or thirty-three of this
 chapter; article twenty-three of this chapter or which 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 paragraph and paragraph
 five of this subsection with respect to refunding of credit to new
 business would be evaded; or
 (B) the individual has operated such new business entity in this state
 for more than five taxable years (excluding short years of the
 business).
 (11) Retail enterprise tax credit. A retail enterprise, not eligible
 to claim the credit under paragraph one of this subsection, but eligible
 to claim the credit allowable under section thirty-eight of the internal
 revenue code pursuant solely to the provisions of subparagraph (E) of
 paragraph one of subsection (a) of section forty-eight of such code,
 shall be allowed a credit as hereinafter computed. The amount of the
 credit shall be the percentage appearing in paragraph one of this
 subsection for the periods described therein for the amount of qualified
 rehabilitation expenditures, as defined in subsection (g) of section
 forty-eight of such code, paid or incurred with respect to a qualified
 rehabilitated building, as defined in such subsection (g), located in
 this state and such expenditures shall be further limited to only the
 portion thereof paid or incurred with respect to that part of a
 qualified rehabilitated building employed by such taxpayer in the retail
 sales activity of such retail enterprise. For the purposes of this
 subsection, the term "retail enterprise" means a taxpayer which is: (A)
 a registered vendor under article twenty-eight of this chapter, (B)
 primarily engaged in the retail sale, as the term "retail sale" is
 defined in subparagraph (i) of paragraph four of subdivision (b) of
 section eleven hundred one of this chapter, of tangible personal
 property, and (C) otherwise eligible for the credit allowed pursuant to
 section thirty-eight of the internal revenue code.
 (12) Rehabilitation credit for historic barns. A taxpayer shall be
 allowed a credit, to be computed as hereinafter provided, against the
 tax imposed by this article. The amount of the credit shall be
 twenty-five percent of the taxpayer's qualified rehabilitation
 expenditures, as defined in paragraph two of subsection (c) of section
 forty-seven of the internal revenue code, which qualify as the basis for
 the credit provided for under paragraph one of subsection (b) of section
 thirty-eight of such code by reason of subsection one of section
 forty-six of such  code, paid or incurred with respect to any barn
 located in this state which is a qualified rehabilitated building, as
 such term is defined in paragraph one of subsection (c) of such section
 forty-seven. For purposes of this paragraph, the term "barn" means a
 building originally designed and used for storing farm equipment or
 agricultural products, or for housing livestock. Provided, however, such
 qualified rehabilitation expenditures shall not include any such
 expenditures which are included, directly or indirectly, in the
 computation of a credit claimed by the taxpayer pursuant to paragraph
 one of this subsection. Provided further that no rehabilitation credit
 shall be allowed for any rehabilitation of a barn which, immediately
 prior to the commencement of such rehabilitation, was used for
 residential purposes, or which converts a barn not suitable for
 residential purposes into one which is so suitable, nor shall a
 rehabilitation credit be allowed for any rehabilitation that materially
 alters the historic appearance of the barn.
 (13)(A)(i) If a taxpayer is required by paragraph seven of this
 subsection to add back a portion of the credit taken  because property
 was destroyed or ceased to be in qualified use as a direct result of the
 September eleventh, two thousand one terrorist attacks, such taxpayer
 may elect to defer the amount to be recaptured for all such property to
 the taxable year next succeeding the taxable year in which the
 destruction or cessation of qualified use occurred. The taxable year in
 which the destruction or cessation of qualified use occurred shall be
 hereinafter referred to as the "recapture event taxable year". If the
 taxpayer's total employment number in the state on the last day of the
 taxable year next succeeding the recapture event taxable year is a
 significant percentage of the taxpayer's average total employment number
 in the state for the taxpayer's recapture event taxable year and the two
 taxable years immediately preceding the recapture event taxable year,
 then the taxpayer shall not be required to recapture any credit with
 respect to such property. If the taxpayer's total employment number in
 the state on the last day of the taxable year next succeeding the
 recapture event taxable year is not a significant percentage of the
 taxpayer's average total employment number in the state for the
 taxpayer's recapture event taxable year and the two taxable years
 immediately preceding the recapture event taxable year, the taxpayer
 shall be required to recapture the portion of the credit taken under
 this subsection, as required by paragraph seven of this subsection, for
 all of its property destroyed or which ceased to be in qualified use as
 a direct result of the September eleventh, two thousand one terrorist
 attacks. The amount required to be recaptured shall be augmented as
 required pursuant to subparagraph (G) of paragraph seven of this
 subsection by using an interest rate equal to two times the rate of
 interest specified in such subparagraph seven applicable for the taxable
 year in which the recapture occurs.
 (ii) The taxpayer's total employment number shall include all
 employees of the taxpayer employed full-time by the taxpayer in the
 state. The average total employment number for the recapture event
 taxable year and the two taxable years immediately preceding the
 recapture event taxable year shall be computed by determining the
 taxpayer's total employment number on the thirty-first day of March, the
 thirtieth day of June, the thirtieth day of September and the
 thirty-first day of December during the applicable taxable years, adding
 together the number of such individuals determined to be so employed on
 each of such dates and dividing the sum so obtained by the number of
 such dates occurring within such applicable taxable years. However, in
 the case of the taxable year which included September eleventh, two
 thousand one, the average total employment number for such taxable year
 shall be determined by using the total employment number on September
 first, two thousand one in lieu of September thirtieth, two thousand one
 and, if such taxable year included December thirty-first, two thousand
 one, by excluding the total employment number on December thirty-first,
 two thousand one.
 (B) In lieu of subparagraph (A) of this paragraph, a taxpayer may
 elect to recapture the portion of the credit taken under this
 subsection, as required by paragraph seven of this subsection, for all
 of its property destroyed or which ceased to be in qualified use as a
 direct result of the September eleventh, two thousand one terrorist
 attacks, in the taxable year in which the destruction or cessation of
 qualified use occurred. If the taxpayer makes such election and acquires
 property (hereinafter referred to as "replacement property") to replace
 any property destroyed as a direct result of the September eleventh, two
 thousand one terrorist attacks (regardless of when such property was
 placed in service and whether a credit was claimed on that property
 pursuant to this subsection), and such replacement property is similar
 or related in service or use to such destroyed property, the investment
 credit base of the replacement property shall be determined without
 regard to any basis reduction required pursuant to section 1033 of the
 internal revenue code.
 (C) The election made by the taxpayer under subparagraph (A) or (B) of
 this paragraph shall be made in the manner and form prescribed by the
 commissioner.
 (D) A taxpayer, over fifty percent of whose employees died as a direct
 result of the September eleventh, two thousand one terrorist attacks,
 may make the election provided for in subparagraph (A) of this
 paragraph, and shall not be required to recapture any credit with
 respect to property which was destroyed or which ceased to be in
 qualified use as a direct result of such attacks, whether or not it
 meets the employment test specified in clause (i) of subparagraph (A) of
 this paragraph.
 (a-1) Employment incentive credit (EIC). (1)(A) Where a taxpayer  is
 allowed a credit under subsection (a) of this section, other than at the
 optional rate applicable to research and development property, the
 taxpayer shall be allowed a credit for each of the two years next
 succeeding the taxable year for which the credit under such subsection
 (a) is allowed with respect to such property, whether or not deductible
 in such taxable year or in subsequent taxable years pursuant to
 paragraph five of subsection (a) of this section. Provided, however,
 that the credit allowable under this subsection for any taxable year
 shall be allowed only if the average number of employees during such
 taxable year is at least one hundred one percent of the average number
 of employees during the employment base year. The employment base year
 shall be the taxable year immediately preceding the taxable year for
 which the credit under such subsection (a) is allowed except that in the
 case of a new business, the employment base year shall be the taxable
 year in which the credit under such subsection (a) is allowed.
 (B) The amount of the credit allowed under this subsection shall be as
 set forth in the following table:
 
 Average number of employees during Credit allowed under this
 the taxable year expressed as a subsection expressed as a
 percentage of average number of percentage of the applicable
 employees in employment base year: investment credit base:
 Less than 102% 1.5%
 at least 102% and less than 103% 2%
 at least 103% 2.5%
 
 (2) The average number of employees in a taxable year shall be
 computed by ascertaining the number of employees within the state
 employed by the taxpayer on the thirty-first day of March, the thirtieth
 day of June, the thirtieth day of September and the thirty-first day of
 December in the taxable year, by adding together the number of employees
 ascertained on each of such dates and dividing the sum so obtained by
 the number of such abovementioned dates occurring within the taxable
 year. For the purposes of this subsection, the term "employees within
 the state" shall not include, except with respect to the employment base
 year, any employee with respect to whom a credit provided for under
 subsection (k) of this section is claimed for the taxable year, based on
 employment within a zone equivalent area designated as such pursuant to
 article eighteen-B of the general municipal law.
 (3) If the amount of credit allowable under this subsection for any
 taxable year shall exceed the taxpayer's tax for such year, the excess
 allowed for a taxable year may be carried over to the ten taxable years
 next following such taxable year and may be deducted from the taxpayer's
 tax for such year or years. In lieu of carrying over any such excess, a
 taxpayer who qualifies as an owner of a new business for purposes of
 paragraph ten of subsection (a) of this section may, at his or her
 option, receive such excess as a refund. Any refund paid pursuant to
 this paragraph shall be deemed to be a refund of an overpayment of tax
 as provided in section six hundred eighty-six of this article, provided,
 however, that no interest shall be paid thereon.
 (b) Household credit. (1) A household credit shall be allowed against
 the tax determined under subsections (a) through (d) of section six
 hundred one of this article. The credit, computed as described in
 paragraph two of this subsection, shall not exceed the tax determined
 under subsections (a) through (d) of section six hundred one for the
 taxable year, reduced by the credits permitted under sections six
 hundred twenty and six hundred twenty-one of this article.
 (2) (A) For any individual who is not married nor the head of a
 household nor a surviving spouse, the amount of the credit allowed
 pursuant to this subsection for taxable years beginning on or after
 January first, nineteen hundred eighty-six shall be determined in
 accordance with the following table:
 
 If household gross income is The credit shall be
 Not over $5,000 $75.00
 Over $5,000 but not over $6,000 60.00
 Over $6,000 but not over $7,000 50.00
 Over $7,000 but not over $20,000 45.00
 Over $20,000 but not over $25,000 40.00
 Over $25,000 but not over $28,000 20.00
 (B) For any husband and wife, head of a household, or surviving
 spouse, the amount of the credit allowed pursuant to this subsection for
 taxable years beginning on or after January first, nineteen hundred
 eighty-six shall be determined in accordance with the following table:
 
 If household gross income is  The credit shall be
 Not over $5,000 $90.00 plus an amount equal to
 $15.00 multiplied by a number which
 is one less than the number of
 exemptions for which the taxpayer
 (or in the case of a husband and
 wife, taxpayers) is entitled to a
  deduction for the taxable year for
 federal income tax purposes under
 subsections (b) and (c) of section
 one hundred fifty-one of the
 internal revenue code
 Over $5,000 but not over $6,000 $75.00 plus such an amount
 Over $6,000 but not over $7,000 $65.00 plus such an amount
 Over $7,000 but not over $20,000 $60.00 plus such an amount
 Over $20,000 but not over $22,000 $60.00 plus an amount equal to
 $10.00 multiplied by a number which
 is one less than the number of
  exemptions for which the taxpayer
 (or in the case of a husband and
 wife, taxpayers) is entitled to a
 deduction for the taxable year for
 federal income tax purposes under
 subsections (b) and (c) of section
 one hundred fifty-one of the
  internal revenue code
 Over $22,000 but not over $25,000 $50.00 plus such an amount
 Over $25,000 but not over $28,000 $40.00 plus an amount equal to $5.00
 multiplied by a number which is one
 less than the number of exemptions
 for which the taxpayer (or in the
 case of a husband and wife,
  taxpayers) is entitled to a
 deduction for the taxable year for
 federal income tax purposes under
 subsections (b) and (c) of section
 one hundred fifty-one of the
 internal revenue code
 Over $28,000 but not over $32,000 $20.00 plus such an amount
 
 (3) For the purposes of this subsection:
 (A) "Household gross income" shall mean the aggregate federal adjusted
 gross income of a household, as the term household is defined in
 subparagraph (B) of this paragraph, for the taxable year.
 (B) "Household" means a husband and wife, a head of household, a
 surviving spouse, or an individual who is not married nor the head of a
 household nor a surviving spouse nor a taxpayer with respect to whom a
 deduction under subsection (c) of section one hundred fifty-one of the
 internal revenue code is allowable to another taxpayer for the taxable
 year.
 (C) "Household gross income of a husband and wife" shall be the
 aggregate of their federal adjusted gross incomes for the taxable year
 irrespective of whether joint or separate New York income tax returns
 are filed. Provided, however, that a husband or wife who is required to
 file a separate New York income tax return shall be permitted one-half
 the credit otherwise allowed his or her household, except as limited by
 paragraph one of this subsection.
 (c) Credit for certain household and dependent care services necessary
 for gainful employment.
 (1) A taxpayer shall be allowed a credit as provided herein equal to
 the applicable percentage of the credit allowable under section
 twenty-one of the internal revenue code for the same taxable year
 (without regard to whether the taxpayer in fact claimed the credit under
 such  section twenty-one for such taxable year). The applicable
 percentage shall be the sum of (i) twenty percent and (ii) a multiplier
 multiplied by a fraction. For taxable years beginning in nineteen
 hundred ninety-six and nineteen hundred ninety-seven, the numerator of
 such fraction shall be the lesser of (i) four thousand dollars or (ii)
 fourteen thousand dollars less the New York adjusted gross income for
 the taxable year, provided, however, the numerator shall not be  less
 than zero. For the taxable year beginning in nineteen hundred
 ninety-eight, the numerator of such fraction shall be the lesser of (i)
 thirteen thousand dollars or (ii) thirty thousand dollars less the New
 York adjusted gross income for the taxable year, provided, however, the
 numerator shall not be less than zero. For taxable years beginning in
 nineteen hundred ninety-nine, the numerator of such fraction shall be
 the lesser of (i) fifteen thousand dollars or (ii) fifty thousand
 dollars less the New York adjusted gross income for the taxable year,
 provided, however, the numerator shall not be less than zero. For
 taxable years beginning after nineteen hundred ninety-nine, the
 numerator  of such fraction shall be the lesser of (i) fifteen thousand
 dollars or (ii) sixty-five thousand dollars less the New York adjusted
 gross income for the taxable year, provided, however, the numerator
 shall not be less than zero. The denominator of such fraction shall be
 four thousand dollars for taxable years beginning in nineteen hundred
 ninety-six and nineteen hundred ninety-seven, thirteen thousand dollars
 for the taxable year beginning in nineteen hundred ninety-eight, and
 fifteen thousand dollars for taxable years beginning after nineteen
 hundred ninety-eight. The multiplier shall be ten percent for taxable
 years beginning in nineteen hundred ninety-six, forty percent for
 taxable years beginning in nineteen hundred ninety-seven, and eighty
 percent for taxable years beginning after nineteen hundred ninety-seven.
 Provided, however, for taxable years beginning after nineteen hundred
 ninety-nine, for  a person whose New York adjusted gross income is less
 than forty thousand dollars, such applicable percentage shall be equal
 to (i) one hundred percent, plus (ii) ten percent multiplied by a
 fraction whose numerator shall be the lesser of  (i) fifteen thousand
 dollars or (ii) forty thousand dollars less the New York adjusted gross
 income for the taxable year, provided such numerator shall not be less
 than zero, and whose denominator shall be fifteen thousand dollars.
 Provided, further, that if the reversion event, as defined in this
 paragraph, occurs, the applicable percentage shall, for taxable years
 ending on or after the date on which the reversion event occurred, be
 determined using the rules specified in this paragraph applicable to
 taxable years beginning in nineteen hundred ninety-nine. The reversion
 event shall be deemed to have occurred on the date on which federal
 action, including but not limited to, administrative, statutory or
 regulatory changes, materially reduces or eliminates New York state's
 allocation of the federal temporary assistance for needy families block
 grant, or materially reduces the ability of the state to spend federal
 temporary assistance for needy families block grant funds for the credit
 for certain household and dependent care services necessary for gainful
 employment or to apply state general fund spending on the credit for
 certain household and dependent care services necessary for gainful
 employment toward the temporary assistance for needy families block
 grant maintenance of effort requirement, and the commissioner of the
 office of temporary and disability assistance shall certify the date of
 such event to the commissioner, the director of the division of the
 budget, the speaker of the assembly and the temporary president of the
 senate.
 (2) Residents. In the case of a resident taxpayer, the credit under
 this subsection shall be allowed against the taxes imposed by this
 article for the taxable year reduced by the credits permitted by this
 article. If the credit exceeds the tax as so reduced, the taxpayer may
 receive, and the comptroller, subject to a certificate of the
 commissioner, shall pay as an overpayment, without interest, the amount
 of such excess.
 (3) Nonresidents. In the case of a nonresident taxpayer, the credit
 under this subsection shall be allowed against the tax determined under
 subsections (a) through (d) of section six hundred one. The amount of
 the credit shall not exceed the tax determined under such subsections
 for the taxable year reduced by the credit permitted under subsection
 (b) of this section.
 (4) Part-year residents. In the case of a part-year resident taxpayer,
 the credit under this subsection shall be allowed against the tax
 determined under subsections (a) through (d) of section six hundred one
 reduced by the credit permitted under subsection (b) of this section,
 and any excess credit after such application shall be allowed against
 the taxes imposed by sections six hundred two and six hundred three. Any
 remaining excess, after such application, shall be refunded as provided
 in paragraph two hereof, provided, however, that any overpayment under
 such paragraph shall be limited to the amount of the remaining excess
 multiplied by a fraction, the numerator of which is federal adjusted
 gross income for the period of residence, computed as if the taxable
 year for federal income tax purposes were limited to the period of
 residence, and the denominator of which is federal adjusted gross income
 for the taxable year.
 (5) In the case of a husband and wife who file a joint federal return,
 but who are required to determine their New York taxes separately, the
 credit allowed pursuant to this subsection may only be applied against
 the tax imposed on the spouse with the lower taxable income, computed
 without regard to such credit. In the case of a husband and wife who are
 not required to file a federal return, the credit under this subsection
 shall be allowed only if such taxpayers file a joint New York income tax
 return.
 (c-1) Empire state child credit. (1) A resident taxpayer shall be
 allowed a credit as provided herein equal to the greater of one hundred
 dollars times the number of qualifying children of the taxpayer or the
 applicable percentage of the child tax credit allowed the taxpayer under
 section twenty-four of the internal revenue code for the same taxable
 year for each qualifying child. Provided, however, in the case of a
 taxpayer whose federal adjusted gross income exceeds the applicable
 threshold amount set forth by section 24(b)(2) of the Internal Revenue
 Code, the credit shall only be equal to the applicable percentage of the
 child tax credit allowed the taxpayer under section 24 of the Internal
 Revenue Code for each qualifying child. For the purposes of this
 subsection, a qualifying child shall be a child who meets the definition
 of qualified child under section 24(c) of the internal revenue code and
 is at least four years of age. The applicable percentage shall be
 thirty-three percent.
 (2) If the amount of the credit allowed under this subsection for any
 taxable year shall exceed the taxpayer's tax for such year, the excess
 shall be treated as an overpayment of tax to be credited or refunded in
 accordance with the provisions of section six hundred eighty-six of this
 article, provided, however, that no interest shall be paid thereon.
 (3) In the case of a husband and wife who file a joint federal return,
 but who are required to determine their New York taxes separately, the
 credit allowed pursuant to this subsection may be applied against the
 tax imposed of either or divided between them as they may elect.
 (d) Earned income credit. (1) General. A taxpayer shall be allowed a
 credit as provided herein equal to (i) the applicable percentage of the
 earned income credit allowed under section thirty-two of the internal
 revenue code for the same taxable year, (ii) reduced by the credit
 permitted under subsection (b) of this section.
 The applicable percentage shall be (i) seven and one-half percent for
 taxable years beginning in nineteen hundred ninety-four, (ii) ten
 percent for taxable years beginning in nineteen hundred ninety-five,
 (iii) twenty percent for taxable years beginning after nineteen hundred
 ninety-five and before two thousand, (iv) twenty-two and one-half
 percent for taxable years beginning in two thousand, (v) twenty-five
 percent for taxable years beginning in two thousand one, (vi)
 twenty-seven and one-half percent for taxable years beginning in two
 thousand two, and (vii) thirty percent for taxable years beginning in
 two thousand three and thereafter. Provided, however, that if the
 reversion event, as defined in this paragraph, occurs, the applicable
 percentage shall be twenty percent for taxable years ending on or after
 the date on which the reversion event occurred. The reversion event
 shall be deemed to have occurred on the date on which federal action,
 including but not limited to, administrative, statutory or regulatory
 changes, materially reduces or eliminates New York state's allocation of
 the federal temporary assistance for needy families block grant, or
 materially reduces the ability of the state to spend federal temporary
 assistance for needy families block grant funds for the earned income
 credit or to apply state general fund spending on the earned income
 credit toward the temporary assistance for needy families block grant
 maintenance of effort requirement, and the commissioner of the office of
 temporary and disability assistance shall certify the date of such event
 to the commissioner of taxation and finance, the director of the
 division of the budget, the speaker of the assembly and the temporary
 president of the senate.
 (2) Residents. In the case of a resident taxpayer, the credit under
 this subsection shall be allowed against the taxes imposed by this
 article for the taxable year reduced by the credits permitted by this
 article. If the credit exceeds the tax as so reduced, the taxpayer may
 receive, and the comptroller, subject to a certificate of the
 commissioner, shall pay as an overpayment, without interest, the amount
 of such excess.
 (3) Nonresidents. In the case of a nonresident taxpayer, the credit
 under this subsection shall be allowed against the tax determined under
 subsections (a) through (d) of section six hundred one. The amount of
 the credit shall not exceed the tax determined under such subsections
 for the taxable year reduced by the credits permitted under subsections
 (b), (c) and (m) of this section.
 (4) Part-year residents. In the case of a part-year resident taxpayer,
 the credit under this subsection shall be allowed against the tax
 determined under subsections (a) through (d) of section six hundred one
 reduced by the credits permitted under subsections (b), (c) and (m) of
 this section, and any excess credit after such application shall be
 allowed against  the taxes imposed by sections six hundred two and six
 hundred three. Any remaining excess, after such application, shall be
 refunded as provided in paragraph two hereof, provided, however, that
 any overpayment under such paragraph shall be limited to the amount of
 the remaining excess multiplied by a fraction, the numerator of which is
 federal adjusted gross income for the period of residence, computed as
 if the taxable year for federal income tax purposes were limited to the
 period of residence, and the denominator of which is federal adjusted
 gross income for the taxable year.
 (5) Husband and wife. In the case of a husband and wife who file a
 joint federal return but who are required to determine their New York
 taxes separately, the credit allowed pursuant to this subsection may be
 applied against the tax of either or divided between them as they may
 elect.
 (6) Notification. The commissioner shall periodically, but not less
 than every three years, make efforts to alert taxpayers that may be
 currently eligible to receive the credit provided under this subsection,
 and the credit provided under any local law enacted pursuant to
 subsection (f) of section thirteen hundred ten of this chapter, as to
 their potential eligibility. In making the determination of whether a
 taxpayer may be eligible for such credit, the commissioner shall use
 such data as may be appropriate and available, including, but not
 limited to, data available from the United States Department of
 Treasury, Internal Revenue Service and New York state income tax returns
 for preceding tax years.
 (7) Reports. The commissioner shall prepare a preliminary written
 report after July thirty-first and a final written report after December
 thirty-first of each calendar year, which shall contain statistical
 information regarding the credits granted on or before such dates under
 this subsection, and under any local law enacted pursuant to subsection
 (f) of section thirteen hundred ten of this chapter, during such
 calendar year. Copies of these reports shall be submitted by such
 commissioner to the governor, the temporary president of the senate, the
 speaker of the assembly, the chairman of the senate finance committee
 and the chairman of the assembly ways and means committee within sixty
 days of July thirty-first with respect to the preliminary report, and
 within forty-five days of December thirty-first with respect to the
 final report, and copies of such reports with respect to credits under
 any local law enacted pursuant to subsection (f) of section thirteen
 hundred ten of this chapter shall be submitted in addition to the mayor
 and the speaker of the council of the city where such a local law is in
 effect. Such reports shall contain, but need not be limited to, the
 number of credits and the average amount of such credits allowed; and of
 those, the number of credits and the average amount of such credits
 allowed to taxpayers in each county; and of those, the number of credits
 and the average amount of such credits allowed to taxpayers whose earned
 income falls within ranges, determined by the commissioner, of not more
 than four thousand dollars; and of those, the number of credits and the
 average amount of such credits allowed to taxpayers who file under the
 different statuses set forth in subsections (a), (b) and (c) of section
 six hundred one of this part; and of those, the number of credits and
 the average amount of such credits allowed to taxpayers whose number of
 qualifying children falls within the categories set forth in such
 section thirty-two of the internal revenue code.
 (d-1) Enhanced earned income tax credit. (1) A taxpayer described in
 paragraph two of this subsection shall be allowed a credit equal to the
 greater of:
 (A) twenty percent of the amount of the earned income tax credit that
 would have been allowed to the taxpayer under section 32 of the internal
 revenue code, absent the application of section 32(b)(2)(B) of such
 code, if the child or children described in subparagraph (C) of
 paragraph two of this subsection satisfied the requirements for a
 qualifying child set forth in section 32(c)(3) of such code, provided
 however, that the credit shall be calculated as if the taxpayer had only
 one child; or
 (B) the product of two and one-half and the amount of the earned
 income tax credit that would have been allowed to the taxpayer under
 section 32 of the internal revenue code, if the taxpayer satisfied the
 eligibility requirements set forth in section 32(c)(1)(A)(ii) of such
 code.
 (2) To be allowed a credit under this subsection, a taxpayer must
 satisfy all of the following qualifications.
 (A) The taxpayer must be a resident taxpayer.
 (B) The taxpayer must have attained the age of eighteen.
 (C) The taxpayer must be the parent of a minor child or children with
 whom the taxpayer does not reside.
 (D) The taxpayer must have an order requiring him or her to make child
 support payments, which are payable through a support collection unit
 established pursuant to section one hundred eleven-h of the social
 services law, which order must have been in effect for at least one-half
 of the taxable year.
 (E) The taxpayer must have paid an amount in child support in the
 taxable year at least equal to the amount of current child support due
 during the taxable year for every order requiring him or her to make
 child support payments.
 (3) If the amount of the credit allowed under this subsection shall
 exceed the taxpayer's tax for such year, the excess shall be treated as
 an overpayment of tax to be credited or refunded in accordance with the
 provisions of section six hundred eighty-six of this article,  provided,
 however, that no interest shall be paid thereon.
 (4) No claim for credit under this subsection shall be allowed unless
 the department has verified, from information provided by the office of
 temporary and disability assistance, that a taxpayer has satisfied the
 qualifications set forth in subparagraphs (C), (D) and (E) of paragraph
 two of this subsection. The office of temporary and disability
 assistance shall provide to the department by January fifteenth of each
 year information applicable for the immediately preceding tax year
 necessary for the department to make such verification. Such information
 shall be provided in the manner and form agreed upon by the department
 and such office. If a taxpayer's claim for a credit under this
 subsection is disallowed because the taxpayer has not satisfied the
 qualifications set forth in subparagraphs (C), (D) and (E) of paragraph
 two of this subsection, the taxpayer may request a review of those
 qualifications by the support collection unit established pursuant to
 section one hundred eleven-h of the social services law through which
 the child support payments were payable. The support collection unit
 shall transmit the result of that review to the office of temporary and
 disability assistance on a form developed by such office. Such office
 shall then transmit such result to the department in a manner agreed
 upon by the department and such office.
 (5) A taxpayer shall not be allowed multiple credits under this
 subsection for a taxable year even if such taxpayer has more than one
 child or has more than one order requiring him or her to make child
 support payments.
 (6) If a credit is allowed under this subsection and the taxpayer is
 also allowed a credit under subsection (d) of this section, the taxpayer
 shall only be allowed to claim one credit.
 (7) In the report prepared pursuant to paragraph seven of subsection
 (d) of this section, the commissioner shall include statistical
 information concerning the credit allowed pursuant to this subsection.
 Such information shall be limited to the number of credits and the
 average amount of such credits allowed; and of those, the number of
 credits and the average amounts of such credits allowed to taxpayers in
 each county.
 (e) Real property tax circuit breaker credit. (1) For purposes of this
 subsection:
 (A) "Qualified taxpayer" means a resident individual of the state who
 has occupied the same residence for six months or more of the taxable
 year, and is required or chooses to file a return under this article.
 (B) "Household" or "members of the household" means a qualified
 taxpayer and all other persons, not necessarily related, who have the
 same residence and share its furnishings, facilities and accommodations.
 Such terms shall not include a tenant, subtenant, roomer or boarder who
 is not related to the qualified taxpayer in any degree specified in
 paragraphs one through eight of subsection (a) of section one hundred
 fifty-two of the internal revenue code. Provided, however, no person may
 be a member of more than one household at one time.
  (c) "Household gross income" means the aggregate adjusted gross income
 of all members of the household for the taxable year as reported for
 federal income tax purposes, or which would be reported as adjusted
 gross income if a federal income tax return were required to be filed,
 with the modifications in subsection (b) of section six hundred twelve
 but without the modifications in subsection (c) of such section, plus
 any portion of the gain from the sale or exchange of property  otherwise
 excluded from such amount; earned income from sources without the United
 States excludable from federal gross income by section nine hundred
 eleven of the internal revenue code; support money not included in
 adjusted gross income; nontaxable strike benefits; supplemental security
 income payments; the gross amount of any pension or annuity benefits to
 the extent not included in such adjusted gross income (including, but
 not limited to, railroad retirement benefits and all payments received
 under the federal social security act and veterans' disability
 pensions); nontaxable interest received from the state of New York, its
 agencies, instrumentalities, public corporations, or  political
 subdivisions (including a public corporation created pursuant to
 agreement or compact with another state or Canada); workers'
 compensation; the gross amount of "loss-of-time" insurance; and the
 amount of cash public assistance and relief, other than medical
 assistance for the needy, paid to or for the benefit of the qualified
 taxpayer or members of his household. Household gross income shall not
 include surplus foods or other relief in kind or payments made to
 individuals because of their status as victims of Nazi persecution as
 defined in P.L. 103-286. Provided, further, household gross income shall
 only include all such income received by all members of the household
 while members of such household.
 (D) "Residence" means a dwelling in this state, whether owned or
 rented, and so much of the land abutting it, not exceeding one acre, as
 is reasonably necessary for use of the dwelling as a home, and may
 consist of a part of a multi-dwelling or multi-purpose building
 including a cooperative or condominium, and rental units within a single
 dwelling. Residence includes a trailer or mobile home, used exclusively
 for residential purposes and defined as real property pursuant to
 paragraph (g) of subdivision twelve of section one hundred two of the
 real property tax law.
 (E) "Qualifying real property taxes" means all real property taxes,
 special ad valorem levies and special assessments, exclusive of
 penalties and interest, levied on the residence of a qualified taxpayer
 and paid during the taxable year less the credit claimed under
 subsection (n-1) of this section. In addition, for taxable years
 beginning after December thirty-first, nineteen hundred eighty-four, a
 qualified taxpayer may elect to include any additional amount that would
 have been levied in the absence of an exemption from real property
 taxation pursuant to section four hundred sixty-seven of the real
 property tax law. If tenant-stockholders in a cooperative housing
 corporation have met the requirements of section two hundred sixteen of
 the internal revenue code by which they are allowed a deduction for real
 estate taxes, the amount of taxes so allowable, or which would be
 allowable if the taxpayer had filed returns on a cash basis, shall be
 qualifying real property taxes. If a residence is owned by two or more
 individuals as joint tenants or tenants in common, and one or more than
 one individual is not a member of the household, qualifying real
 property taxes is that part of such taxes on the residence which
 reflects the ownership percentage of the qualified taxpayer and members
 of his household. If a residence is an integral part of a larger unit,
 qualifying real property taxes shall be limited to that amount of such
 taxes paid as may be reasonably apportioned to such residence. If a
 household owns and occupies two or more residences during different
 periods in the same taxable year, qualifying real property taxes shall
 be the sum of the prorated qualifying real property taxes attributable
 to the household during the periods such household occupies each of such
 residences. If the household owns and occupies a residence for part of
 the taxable year and rents a residence for part of the same taxable
 year, it may include both the proration of qualifying real property
 taxes on the residence owned and the real property tax equivalent with
 respect to the months the residence is rented. Provided, however, for
 purposes of the credit allowed under this subsection, qualifying real
 property taxes may be included by a qualified taxpayer only to the
 extent that such taxpayer or the spouse of such taxpayer occupying such
 residence for six months or more of the taxable year owns or has owned
 the residence and paid such taxes.
 (F) "Real property tax equivalent" means twenty-five percent of the
 adjusted rent actually paid in the taxable year by a household solely
 for the right of occupancy of its New York residence for the taxable
 year. If (i) a residence is rented to two or more individuals as
 cotenants, or such individuals share in the payment of a single rent for
 the right of occupancy of such residence, and (ii) each of such
 individuals is a member of a different household, one or more of which
 individuals shares such residence, real property tax equivalent is that
 portion of twenty-five percent of the adjusted rent paid in the taxable
 year which reflects that portion of the rent attributable to the
 qualified taxpayer and the members of his household.
 (G) "Adjusted rent" means rental paid for the right of occupancy of a
 residence, excluding charges for heat, gas, electricity, furnishings and
 board. Where charges for heat, gas, electricity, furnishing or board are
 included in rental but where such charges and the amount thereof are not
 separately set forth in a written rental agreement, for purposes of
 determining adjusted rent the qualified taxpayer shall reduce rental
 paid as follows:
 (i) For heat, or heat and gas, deduct fifteen percent of rental paid.
 (ii) For heat, gas and electricity, deduct twenty percent of rental
 paid.
 (iii) For heat, gas, electricity and furnishings, deduct twenty-five
 percent of rental paid.
 (iv) For  heat, gas, electricity, furnishings and board, deduct fifty
 percent of rental paid.
 If the tax commission determines that the adjusted rent shown on the
 return is excessive, the tax commission may reduce such rent, for
 purposes of the computation of the credit, to an amount substantially
 equivalent to rent for a comparable accommodation.
 (2) A qualified taxpayer shall be allowed a credit as provided in
 paragraph three hereof against the taxes imposed by this article reduced
 by the credits permitted by this article. If the credit exceeds the tax
 as so reduced for such year under this article the qualified taxpayer
 may receive, and the comptroller, subject to a certificate of the state
 tax commission, shall pay as an overpayment, without interest, any
 excess between such tax as so reduced and the amount of the credit. If a
 qualified taxpayer is not required to file a return pursuant to section
 six hundred fifty-one, a qualified taxpayer may nevertheless receive and
 the comptroller, subject to a certificate of the state tax commission,
 shall pay as an overpayment the full amount of the credit, without
 interest.
 (3) Determination of credit. (A) For qualified taxpayers who have
 attained the age of sixty-five years before the beginning of or during
 the taxable year the amount of the credit allowable under this
 subsection shall be fifty percent, or in the case of a qualified
 taxpayer who has elected to include an additional amount pursuant to
 subparagraph (E) of paragraph one of this subsection, twenty-five
 percent, of the excess of real property taxes or the excess of real
 property tax equivalent determined as follows:
 
  Excess real property taxes are the
 excess of real property tax
 equivalent or the excess of
 qualifying real property taxes over
 the fol-
 If household gross income for the lowing percentage of household
 taxable year is: gross income:
 ----------------------------------- -----------------------------------
 $3,000 or less 3 1/2
 Over $3,000 but not over $5,000 4
 Over $5,000 but not over $7,000 4 1/2
 Over $7,000 but not over $9,000 5
 Over $9,000 but not over $11,000 5 1/2
 Over $11,000 but not over $14,000 6
 Over $14,000 but not over $18,000 6 1/2
 
 Notwithstanding the foregoing provisions, the maximum credit
  determined under this subparagraph may not exceed the amount determined
 in accordance with the following table:
 
 If household gross income for the
 taxable year is: The maximum credit is:
 ----------------------------------- -----------------------------------
 $1,000 or less $375
 Over $1,000 but not over $2,000 $358
 Over $2,000 but not over $3,000 $341
 Over $3,000 but not over $4,000  $324
 Over $4,000 but not over $5,000 $307
 Over $5,000 but not over $6,000 $290
 Over $6,000 but not over $7,000 $273
 Over $7,000 but not over $8,000 $256
 Over $8,000 but not over $9,000 $239
 Over $9,000 but not over $10,000 $222
 Over $10,000 but not over $11,000 $205
 Over $11,000 but not over $12,000 $188
 Over $12,000 but not over $13,000 $171
 Over $13,000 but not over $14,000 $154
 Over $14,000 but not over $15,000 $137
 Over $15,000 but not over $16,000 $120
 Over $16,000 but not over $17,000  $103
 Over $17,000 but not over $18,000 $ 86
 
 (B) For all other qualified taxpayers the amount of the credit
 allowable under this subsection shall be fifty percent of excess real
 property taxes or the excess of the real property tax equivalent
 determined as follows:
 
 Excess real property taxes are the
 excess of real property tax
  equivalent or the excess of
 qualifying real property taxes over
 the fol-
 If household gross income for the lowing percentage of household
 taxable year is: gross income:
 ----------------------------------- -----------------------------------
 $3,000 or less 3 1/2
 Over $3,000 but not over $5,000 4
 Over $5,000 but not over $7,000 4 1/2
 Over $7,000 but not over $9,000 5
 Over $9,000 but not over $11,000 5 1/2
 Over $11,000 but not over $14,000 6
 Over $14,000 but not over $18,000  6 1/2
 
 Notwithstanding the foregoing provisions, the maximum credit
 determined under this subparagraph may not exceed the amount determined
 in accordance with the following table:
 
 If household gross income for the
 taxable year is: The maximum credit is:
 ----------------------------------- -----------------------------------
 $1,000 or less $75
 Over $1,000 but not over $2,000 $73
 Over $2,000 but not over $3,000 $71
 Over $3,000 but not over $4,000 $69
 Over $4,000 but not over $5,000 $67
 Over $5,000 but not over $6,000 $65
 Over $6,000 but not over $7,000  $63
 Over $7,000 but not over $8,000 $61
 Over $8,000 but not over $9,000 $59
 Over $9,000 but not over $10,000 $57
 Over $10,000 but not over $11,000 $55
 Over $11,000 but not over $12,000 $53
 Over $12,000 but not over $13,000 $51
 Over $13,000 but not over $14,000 $49
 Over $14,000 but not over $15,000 $47
 Over $15,000 but not over $16,000 $45
 Over $16,000 but not over $17,000 $43
 Over $17,000 but not over $18,000 $41
 
 (4) If a qualified taxpayer occupies a residence for a period of less
 than twelve months during the taxable year or occupies two or more
 residences during different periods in such taxable year, the credit
 allowed pursuant to this subsection shall be computed in such manner as
 the tax commission may, by regulation, prescribe in order to properly
 reflect the credit or portion thereof attributable to such residence or
 residences and such period or periods.
 (5) The tax commission may prescribe that the credit under this
 subsection shall be determined in whole or in part by the use of tables
 prescribed by such commission. Such tables shall set forth the credit to
 the nearest dollar.
 (6) Only one credit per household and per qualified taxpayer shall be
 allowed per taxable year under this subsection. When two or more members
 of a household are able to meet the qualifications for a qualified
 taxpayer, the credit shall be equally divided between or among such
 individuals unless such individuals file with the tax commission a
 written agreement among such individuals setting forth a different
 division. Where two or more members of a household are able to meet the
 qualifications of a qualified taxpayer and one of them is sixty-five
 years of age or more, the credit which may be taken shall be the credit
 applicable to individuals who have attained the age of sixty-five years.
 (A) Provided, however, where a joint income tax return has been filed
 pursuant to the provisions of section six hundred fifty-one by a
 qualified taxpayer and his spouse (or where both spouses are qualified
 taxpayers and have filed such joint return), the credit, or the portion
 of the credit if divided, to which the husband and wife are entitled
 shall be applied against the tax of both spouses and any overpayment
 shall be made to both spouses.
 (B) Where any return required to be filed pursuant to the provisions
 of section six hundred fifty-one is combined with any return of tax
 imposed pursuant to the authority of this chapter or any other law if
 such tax is administered by the tax commission, the credit or the
 portion of the credit if divided, allowed to the qualified taxpayer may
 be applied by the tax commission toward any liability for the
 aforementioned taxes.
 (7) No credit shall be granted under this subsection:
 (A) If household gross income for the taxable year exceeds eighteen
 thousand dollars.
 (B) To a property owner unless: (i) the property is used for
 residential purposes, (ii) not more than twenty percent of the rental
 income, if any, from the property is from rental for nonresidential
 purposes and (iii) the property is occupied as a residence in whole or
 in part by one or more of the owners of the property.
 (C) To a property owner who owns real property, the full value of
 which exceeds eighty-five thousand dollars.
 (D) To a tenant if the adjusted rent for the residence exceeds four
 hundred fifty dollars per month on average.
 (E) To an individual with respect to whom a deduction under subsection
 (c) of section one hundred fifty-one of the internal revenue code is
 allowable to another taxpayer for the taxable year.
  (F) With respect to a residence that is wholly exempted from real
 property taxation.
 (G) To an individual who is not a resident individual of the state for
 the entire taxable year.
 (8) The right to claim a credit or the portion of a credit, where such
 credit has been divided under this subsection, shall be personal to the
 qualified taxpayer and shall not survive his death, but such right may
 be exercised on behalf of a claimant by his legal guardian or attorney
 in fact during his lifetime.
 (9) Returns. If a qualified taxpayer is not required to file a return
 pursuant to section six hundred fifty-one, a claim for a credit may be
 taken on a return filed with the tax commission within three years from
 the time it would have been required that a return be filed pursuant to
 such section had the qualified taxpayer had a taxable year ending on
 December thirty-first. Returns under this paragraph shall be in such
 form as shall be prescribed by the tax commission, which shall make
 available such forms and instructions for filing such returns.
 (10) Proof of claim. The tax commission may require a qualified
 taxpayer to furnish the following information in support of his claim
 for credit under this subsection: household gross income, rent paid,
 name and address of owner or managing agent of the property rented, real
 property taxes levied or that would have been levied in the absence of
 an exemption from real property tax pursuant to section four hundred
 sixty-seven of the real property tax law, the names of members of the
 household and other qualifying taxpayers occupying the same residence
 and their identifying numbers including social security numbers,
 household gross income, size and nature of property claimed as residence
 and all other information which may be required by the tax commission to
 determine the credit.
 (11) Administration. The provisions of this article, including the
 provisions of section six hundred fifty-three, six hundred fifty-eight,
 and six hundred fifty-nine and the provisions of part six of this
 article relating to procedure and administration, including the judicial
 review of the decisions of the tax commission, except so much of section
 six hundred eighty-seven which permits a claim for credit or refund to
 be filed after the period provided for in paragraph nine of this
 subsection and except sections six hundred fifty-seven, six hundred
 eighty-eight and six hundred ninety-six, shall apply to the provisions
 of this subsection in the same manner and with the same force and effect
 as if the language of those provisions had been incorporated in full
 into this subsection and had expressly referred to the credit allowed or
 returns filed under this subsection, except to the extent that any such
 provision is either inconsistent with a provision of this subsection or
 is not relevant to this subsection. As used in such sections and such
 part, the term "taxpayer" shall include a qualified taxpayer under this
 subsection and, notwithstanding the provisions of subsection (e) of
 section six hundred ninety-seven, where a qualified taxpayer has
 protested the denial of a claim for credit under this subsection and the
 time to file a petition for redetermination of a deficiency or for
 refund has not expired, he shall, subject to such conditions as may be
 set by the tax commission, receive such information (A) which is
 contained in any return filed under this article by a member of his
 household for the taxable year for which the credit is claimed, and (B)
 which the tax commission finds is relevant and material to the issue of
 whether such claim was properly denied. The tax commission shall have
 the authority to promulgate such rules and regulations as may be
 necessary for the processing, determination and granting of credits and
 refunds under this subsection.
 (12) The commissioner may request the cooperation of the state board
 of real property services in carrying out the provisions of this
 subsection. Such board may promulgate such rules and regulations,
 subject to prior consultation with the commissioner, as may be necessary
 to provide such assistance with respect to the determination of full
 value of real property for purposes of the credit allowed under this
 subsection.
 (13) Notwithstanding any other provision of this article, the credit
 allowed under this subsection shall be determined after the
 determination and application of any other credits permitted under the
 provisions of this article.
 (14) The commissioner of taxation and finance shall prepare a
 preliminary written report after July thirty-first and a final written
 report after December thirty-first of each calendar year, which shall
 contain statistical information regarding the credits granted on or
 before such dates under this subsection during such calendar year.
 Copies of these reports shall be submitted by such commissioner to the
 governor, the temporary president of the senate, the speaker of the
 assembly, the chairman of the senate finance committee and the chairman
 of the assembly ways and means committee within sixty days of July
 thirty-first with respect to the preliminary report, and within
 forty-five days of  December thirty-first with respect to the final
 report. Such reports shall contain, but need not be limited to, the
 number of credits and the average amount of such credits allowed; and of
 those, the number of credits and the average amount of such credits
 allowed to qualified taxpayers in each county; and of those, the number
 of credits and the average amount of such credits allowed to qualified
 taxpayers whose household gross income falls within each of the
 household gross income ranges set forth in paragraph three of this
 subsection; and of those, the number of credits and the average amount
 of such credits allowed to qualified taxpayers whose credit amount falls
 within credit amount ranges set forth in twenty-five dollar increments.
 (e-1) Volunteer firefighters' and ambulance workers' credit. (1) For
 taxable years beginning on and after January first, two thousand seven,
 a resident taxpayer who serves as an active volunteer firefighter as
 defined in subdivision one of section two hundred fifteen of the general
 municipal law or as a volunteer ambulance worker as defined in
 subdivision fourteen of section two hundred nineteen-k of the general
 municipal law shall be allowed a credit against the tax imposed by this
 article equal to two hundred dollars. In order to receive this credit a
 volunteer firefighter or volunteer ambulance worker must have been
 active for the entire taxable year for which the credit is sought.
 (2) If a taxpayer receives a real property tax exemption relating to
 such service under title two of article four of the real property tax
 law, such taxpayer shall not be eligible for this credit; provided,
 however (A) if the taxpayer receives such real property tax exemption in
 the two thousand seven taxable year as a result of making application
 therefor in a prior year or (B) if the taxpayer notifies his or her
 assessor in writing by December thirty-first, two thousand seven of the
 taxpayer's intent to discontinue such real property tax exemption by not
 re-applying for such real property tax exemption by the next taxable
 status date, such taxpayer shall be eligible for this credit for the two
 thousand seven taxable year.
 (3) In the case of a husband and wife who file a joint return and who
 both individually qualify for the credit under this subsection, the
 amount of the credit allowed shall be four hundred dollars.
 (4) If the amount of the credit allowed under this subsection for any
 taxable year shall exceed the taxpayer's tax for such year, the excess
 shall be treated as an overpayment of tax to be credited or refunded in
 accordance with the provisions of section six hundred eighty-six of this
 article, provided, however, that no interest shall be paid thereon.
 (f) Credit for the special additional mortgage recording tax. (1) For
 taxable years beginning before nineteen hundred eighty-eight, a taxpayer
 shall be allowed a credit, to be credited against the tax imposed by
 this article, after allowance of any other credit provided under this
 section and any credits permitted under sections six hundred twenty, six
 hundred twenty-one and six hundred thirty-five of this article. The
 amount of the credit shall be the amount of the special additional
 mortgage recording tax paid by the taxpayer pursuant to the provisions
 of subdivision one-a of section two hundred fifty-three of this chapter
 on mortgages recorded on and after January first, nineteen hundred
 seventy-nine. Provided, however, no credit shall be allowed with respect
 to a mortgage of real property principally improved or to be improved by
 one or more structures containing in the aggregate not more than six
 residential dwelling units, each dwelling unit having its own separate
 cooking facilities, where the real property is located in one or more of
 the counties comprising the metropolitan commuter transportation
 district and where the mortgage is recorded on or after May first,
 nineteen hundred eighty-seven. Provided, however, no credit shall be
 allowed with respect to a mortgage of real property principally improved
 or to be improved by one or more structures containing in the aggregate
 not more than six residential dwelling units, each dwelling unit having
 its own separate cooking facilities, where the real property is located
 in the county of Erie and where the mortgage is recorded on or after May
 first, nineteen hundred eighty-seven.
 (2) In no event shall the amount of the credit herein provided for be
 allowed in excess of the taxpayer's tax for such year. However, if the
 amount of credit otherwise allowable under this subsection for any
 taxable year results in such excess amount, 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.
 (3)(A) Notwithstanding the provisions of paragraphs one and two of
 this subsection, for taxable years beginning after two thousand three, a
 taxpayer shall be allowed a credit, to be credited against the tax
 imposed by this article, equal to the amount of the special additional
 mortgage recording tax paid by the taxpayer or, in the case of a
 taxpayer who is a partner in a partnership, the partner's pro rata share
 of the amount of the special additional mortgage recording tax paid by
 the partnership, pursuant to the provisions of subdivision one-a of
 section two hundred fifty-three of this chapter on mortgages recorded on
 and after January first, two thousand four. Provided, however, no credit
 shall be allowed with respect to a mortgage of real property principally
 improved by one or more structures containing in the aggregate not more
 than six residential dwelling units, each dwelling unit having its own
 separate cooking facilities, where the real property is located in one
 or more of the counties comprising the metropolitan commuter
 transportation district and where the mortgage is recorded on or after
 January first,  two thousand four. Provided further, no credit shall be
 allowed with respect to a mortgage of real property principally improved
 by one or more structures containing in the aggregate not more than six
 residential dwelling units, each dwelling unit having its own separate
 cooking facilities, where the real property is located in Erie county
 and where the mortgage is recorded on or after January first, two
 thousand four.
 (B) If the amount of credit allowable under this paragraph for any
 taxable year exceeds the taxpayer's tax for such year, any amount of
 credit exceeding such tax may be carried over to the following year or
 years and may be deducted from the taxpayer's tax for such year or
 years. Provided further, such taxpayer may elect to treat such unused
 amount of credit as an overpayment of tax to be credited or refunded in
 accordance with the provisions of section six hundred eighty-six of this
 article except that no interest shall be paid on such overpayment.
 (g) Credit for solar and wind energy systems. (1) A taxpayer shall be
 allowed a credit for taxable years beginning on or after January first,
 nineteen hundred eighty-one and ending before December thirty-first,
 nineteen hundred eighty-six against the tax imposed by this article for
 the purchase and installation of a solar or wind energy system by a
 taxpayer in his principal residence, if such residence is located within
 the state. The amount of the credit shall be fifty-five percent of the
 expenditure incurred in purchasing and installing any such system or
 combination thereof, but not to exceed the maximum credit of two
 thousand seven hundred fifty dollars.
 (2) A solar or wind system is a system whose original use begins with
 the taxpayer; which meets the eligibility criteria, if any, prescribed
 by the department of taxation and finance; and which is:
 (A) an active solar energy system which shall mean an arrangement or
 combination of components designed to provide heating, cooling, hot
 water or electricity through the process of collecting solar radiation,
 converting it to another form of energy, storing the converted energy,
 protecting against unnecessary dissipation and distributing the
 converted energy, and which requires external mechanical power for
 operation. This term shall not include pipes, controls, insulation or
 other equipment which are part of the conventional heating, cooling,
 insulation or electrical system of a building; nor shall it include any
 expenditure allocable to a swimming pool used as a storage medium;
 (B) a passive solar energy system, which shall mean a system which
 relies upon the original or retrofitted design and elements of a
 building to enhance the use of natural forces including solar radiation,
 winds and night-time coolness to provide heating, cooling or hot water
 through the process of collecting solar radiation, converting it to
 another form of energy, storing the converted energy, protecting against
 unnecessary dissipation and distributing the converted energy, and which
 is not primarily dependent upon mechanical power for operation. This
 term shall not include pipes, controls, insulation or other equipment
 which are part of the conventional heating, cooling or insulation system
 of the building; nor shall it include any expenditure allocable to a
 swimming pool used as a storage medium; or
 (C) a wind energy system, which shall mean an arrangement or
 combination of components, including power conditioning equipment,
 designed to provide electricity or mechanical energy through the process
 of converting wind energy into mechanical and/or electric energy, and
 storing or distributing such energy.
 (3) Where a solar or wind energy system is purchased and installed by
 a condominium management association  or a cooperative housing
 corporation, a taxpayer who is a member of the condominium management
 association or who is a tenant-stockholder in the cooperative housing
 corportion may for the purpose of this subsection claim a proportionate
 share of the total expense as the expenditure for the purposes of the
 credit attributable to his principal residence.
 (4) Where a solar or wind system is purchased and installed in a
 principal residence shared by two or more taxpayers the amount of the
 credit allowable under this subsection for each such taxpayer shall be
 prorated according to the percentage of the total expenditure for such
 system contributed by each taxpayer.
 (5) To the extent that a federal income tax credit shall apply to
 expenditures eligible for a credit under this subsection, the credit
 provided in this subsection shall be reduced so that the combined credit
 shall not exceed fifty-five percent of such expenditures or six thousand
 seven hundred fifty dollars, whichever is less.
 (6) If the amount of credit allowable under this subsection shall
 exceed the taxpayer's tax for such year, the excess may be carried over
 to the following year or years and may be deducted from the taxpayer's
 tax for such year or years.
 (7) If all or any part of the credit provided for under this
 subsection was allowed or carried over from a prior taxable year or
 years, a taxpayer shall reduce the allowable credit for additional
 qualifying expenditures in a subsequent tax year by the amount of the
 credit previously allowed or carried over; provided however that a
 credit previously allowed or carried over from a prior taxable year or
 years shall not be taken into account in determining the allowable
 credit for the purchase and installation of a solar or wind energy
 system in a subsequent principal residence.
 (8) For the purpose of determining the amount of the actual
 expenditure incurred in purchasing and installing a solar or wind energy
 system, the amount of any federal, state or local grant received by the
 taxpayer, which was used for the purchase and/or installation of such
 system and which was not included in the gross income of the taxpayer,
 shall not be taken into account.
 (9) Notwithstanding any other provision of law, if a credit is allowed
 under this subsection for a renewable energy system with respect to any
 property, the increase in the basis of such property which would but for
 this subsection result from such expenditure shall be reduced by the
 amount of the credit allowed. When the sale or other disposition of such
 property results in the nonrecognition of gain under section one
 thousand thirty-four of the internal revenue code, a like reduction
 shall be made to the basis of the new residence, if such residence is
 located within the state.
 (g-1) Solar energy system equipment credit. (1) General. An individual
 taxpayer shall be allowed a credit against the tax imposed by this
 article equal to twenty-five percent of qualified solar energy system
 equipment expenditures. This credit shall not exceed three thousand
 seven hundred fifty dollars for qualified solar energy equipment placed
 in service before September first, two thousand six, and five thousand
 dollars for qualified solar energy equipment placed in service on or
 after September first, two thousand six.
 (2) Qualified solar energy system equipment expenditures. (A) The term
 "qualified solar energy system equipment expenditures" means
 expenditures for the purchase of solar energy system equipment which is
 installed in connection with residential property which is (i) located
 in this state and (ii) which is used by the taxpayer as his or her
 principal residence at the time the solar energy system equipment is
 placed in service.
 (B) Such qualified expenditures shall include expenditures for
 materials, labor costs properly allocable to on-site preparation,
 assembly and original installation, architectural and engineering
 services, and designs and plans directly related to the construction or
 installation of the solar energy system equipment.
 (C) Such qualified expenditures shall not include interest or other
 finance charges.
 (3) Solar energy system equipment. The term "solar energy system
 equipment" shall mean an arrangement or combination of components
 utilizing solar radiation, which, when installed in a residence,
 produces energy designed to provide heating, cooling, hot water or
 electricity for use in such residence. Such arrangement or components
 shall not include equipment connected to solar energy system equipment
 that is a component of part or parts of a non-solar energy system or
 which uses any sort of recreational facility or equipment as a storage
 medium. Solar energy system equipment that generates electricity for use
 in a residence must conform to applicable requirements set forth in
 section sixty-six-j of the public service law. Provided, however, where
 solar energy system equipment is purchased and installed by a
 condominium management association or a cooperative housing corporation,
 for purposes of this subsection only, the term "ten kilowatts" in such
 section sixty-six-j shall be read as "fifty kilowatts."
 (4) Multiple taxpayers. Where solar energy system equipment is
 purchased and installed in a principal residence shared by two or more
 taxpayers, the amount of the credit allowable under this subsection for
 each such taxpayer shall be prorated according to the percentage of the
 total expenditure for such solar energy system equipment contributed by
 each taxpayer.
 (5) Proportionate share. Where solar energy system equipment is
 purchased and installed by a condominium management association or a
 cooperative housing corporation, a taxpayer who is a member of the
 condominium management association or who is a tenant-stockholder in the
 cooperative housing corporation may for the purpose of this subsection
 claim a proportionate share of the total expense as the expenditure for
 the purposes of the credit attributable to his principal residence.
 (6) Grants. For purposes of determining the amount of the expenditure
 incurred in purchasing and installing solar energy system equipment, the
 amount of any federal, state or local grant received by the taxpayer,
 which was used for the purchase and/or installation of such equipment
 and which was not included in the federal gross income of the taxpayer,
 shall not be included in the amount of such expenditures.
 (7) When credit allowed. The credit provided for herein shall be
 allowed with respect to the taxable year, commencing after nineteen
 hundred ninety-seven, in which the solar energy system equipment is
 placed in service.
 (8) Carryover of credit. If the amount of the credit, and carryovers
 of such credit, allowable under this subsection for any taxable year
 shall exceed the taxpayer's tax for such year, such excess amount may be
 carried over to the five taxable years next following the taxable year
 with respect to which the credit is allowed and may be deducted from the
 taxpayer's tax for such year or years.
 (g-2) Fuel cell electric generating equipment credit. (1) General.
 For taxable years beginning before January first, two thousand nine, an
 individual taxpayer shall be allowed a credit against the tax imposed by
 this article equal  to twenty percent of qualified fuel cell electric
 generating equipment expenditures. This credit shall not exceed one
 thousand five hundred dollars per generating unit with respect to any
 taxable year. The credit provided for herein shall be allowed with
 respect to the taxable year in which the fuel cell electric generating
 equipment is placed in service.
 (2) Qualified fuel cell electric generating equipment expenditures.
 (A) Qualified fuel cell electric generating equipment expenditures are
 the costs, incurred on or after July first, two thousand five,
 associated with the purchase of on-site electricity generation systems
 utilizing proton exchange membrane fuel cells, providing a rated
 baseload capacity of no less than one kilowatt and no more than one
 hundred kilowatts of electricity, which are located in this state at the
 time the qualified fuel cell electric generating equipment is placed in
 service.
 (B) Qualified fuel cell electric generating equipment expenditures
 shall also include costs, incurred on or after July first, two thousand
 five, for materials, labor for on-site preparation, assembly and
 original installation, engineering services, designs and plans directly
 related to construction or installation and utility compliance costs.
 (C) Such qualified expenditures shall not include interest or other
 finance charges.
 (3) Multiple taxpayers. Where fuel cell electric generating equipment
 is purchased and installed in a principal residence shared by two or
 more taxpayers, the amount of the credit allowable under this subsection
 for each such taxpayer shall be prorated according to the percentage of
 the total expenditure for such fuel cell electric generating equipment
 contributed by each taxpayer.
 (4) Grants. For purposes of determining the amount of the expenditure
 incurred in purchasing and installing fuel cell electric generating
 equipment, the amount of any federal, state or local grant received by
 the taxpayer, which was used for the purchase and/or installation of
 such equipment and which was not included in the federal gross income of
 the taxpayer, shall not be included in the amount of such expenditures.
 (5) Carryover of credit. If the amount of the credit, and carryovers
 of such credit, allowable under this subsection for any taxable year
 shall exceed the taxpayer's tax for such year, such excess amount may be
 carried over to the five taxable years next following the taxable year
 with respect to which the credit is allowed and may be deducted from the
 taxpayer's tax for such year or years.
 (h) Research and development tax credit. (1) For taxable years
 commencing prior to January first, nineteen hundred eighty-seven, a
 taxpayer shall be allowed a credit against the tax imposed by this
 article after allowance of any other credit provided under this section
 and any credits permitted under sections six hundred twenty, six hundred
 twenty-one and six hundred thirty-five of this article. The amount of
 the credit shall be ten percent of the cost or other basis for federal
 income tax purposes of tangible personal property, including buildings
 and other structural components of buildings, described in paragraph two
 of this subsection acquired, constructed or reconstructed, or erected
 after June thirtieth, nineteen hundred eighty-two.
 (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 are: depreciable
 pursuant to section one hundred sixty-seven of the internal revenue
 code, have a useful life of four years or more, are acquired by purchase
 as defined in section one hundred seventy-nine (d) of the internal
 revenue code, have a situs in this state and are used or are to be used
 for purposes of research and development in the experimental or
 laboratory sense. Such purposes shall not be deemed to include the
 ordinary testing or inspection of materials or products for quality
 control, efficiency surveys, management studies, consumer surveys,
 advertising, promotions, or research in connection with literary,
 historical or similar projects.
 (3) A taxpayer shall not be allowed a credit under this subsection
 with respect to any property described in paragraphs one and two of this
 subsection, if such property qualifies for the modification allowed
 under either paragraph three or paragraph four of subsection (g) of
 section six hundred twelve whether or not such amount shall have been
 subtracted, or if a credit is taken pursuant to subsection (a) of this
 section. Provided, however, with respect to property which qualifies
 under either clause (A), (B) or (C) of paragraph four of subsection (g)
 because such property was ordered on or before December thirty-first,
 nineteen hundred sixty-eight, but with respect to which no expenditure
 has been paid or incurred at such date, the taxpayer may elect to
 subtract the amount allowable under clause (A), (B) or (C) or may take
 the credit provided by this subsection, but not both.
 (4) A taxpayer shall not be allowed a credit under this subsection
 with respect to 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
 subsection 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.
 (5) If the amount of credit allowable under this subsection for any
 taxable year shall exceed the taxpayer's tax for such year, the excess
 may be carried over to the following year or years and may be deducted
 from the taxpayer's tax for such year or years but in no event shall
 such credit be carried over to taxable years commencing on or after
 January first, nineteen hundred ninety-four.
 (6) (A) With respect to 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 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 subsection 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 subparagraph, 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 subparagraph (D) of
 this paragraph applies, with respect to three-year property, as defined
 in subsection (e) 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 subsection 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 subparagraph (D) of
 this paragraph applies, with respect to property 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 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 subsection 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 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 subsection 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 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 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 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 total
 number of months over which the taxpayer chooses to deduct the property
 under the internal revenue code.
 (i) S corporation credits.
 (1) For purposes of determining the application under this section of
 the credit provisions enumerated in the following table, a shareholder
 of a New York S corporation:
 (A) shall be treated as the taxpayer with respect to his or her pro
 rata share of the corresponding credit base of such corporation,
 determined for the corporation's taxable year ending with or within the
 shareholder's taxable year and
 (B) shall be treated as the owner of a new business with respect to
 such share if the corporation qualifies as a new business pursuant to
 paragraph (j) of subdivision twelve of section two hundred ten of this
 chapter.
 
 The corporation's credit base under
 section two hundred ten or section
 With respect to the following fourteen hundred fifty-six of this
 credit under this section: chapter is:
 
 (i) Investment tax credit under Investment credit base or qualified
 subsection (a) rehabilitation expenditures under
 subdivision twelve of section two
 hundred ten
 
 (ii) Empire zone investment Cost or other basis under
 tax credit under subsection (j) subdivision twelve-B of section
 two hundred ten
 
 (iii) Empire zone wage tax credit Eligible wages under subdivision
 under subsection (k) nineteen of section two hundred
 ten or subsection (e) of section
 fourteen hundred fifty-six
 
 (iv) Empire zone capital tax Qualified investments and
 credit under subsection (l) contributions under subdivision
  twenty of section two hundred ten
 or subsection (d) of section
 fourteen hundred fifty-six
 
 (v) Agricultural property tax Allowable school district property
 credit under subsection (n) taxes under subdivision twenty-two
 of section two hundred ten
 
 (vi) Credit for employment of Qualified first-year wages or
 persons with disabilities  qualified second-year wages under
 under subsection (o) subdivision twenty-three of
 section two hundred ten or
 subsection (f) of section
  fourteen hundred fifty-six
 
 (vii) Employment incentive credit Applicable investment credit base
 under subsection (a-1) under subdivision twelve-D of
 section two hundred ten
 
 (viii) Empire zone employment Applicable investment credit
 incentive credit under subsection under subdivision twelve-C of
 (j-1) section two hundred ten
 
 (ix) Alternative fuels credit Cost under subdivision twenty-four
 under subsection (p) of section two hundred ten
 
 (x) Qualified emerging technology Applicable credit base under
 company employment credit under subdivision twelve-E of section
 subsection (q) two hundred ten
 
 (xi) Qualified emerging technology Qualified investments under
 company capital tax credit under subdivision twelve-F of section
 subsection (r) two hundred ten
 
 (xii) Credit for purchase of an Cost of an automated external
 automated external defibrillator defibrillator under subdivision
 under subsection (s) twenty-five of section two hundred
 ten or subsection (j) of section
 fourteen hundred fifty-six
 
 (xiii) Low-income housing credit Credit amount under subdivision
 under subsection (x) thirty of section two hundred ten
  or subsection (l) of section
 fourteen hundred fifty-six
 (xiv) Credit for transportation For taxable years beginning
 improvement contributions under before January first, two thousand
 subsection (z) nine, amount of credit under
 subdivision thirty-two of
 section two hundred ten
 or subsection (n) of section
  fourteen hundred fifty-six
 
 (xv) QEZE credit for real property Amount of credit under subdivision
 taxes under subsection (bb) twenty-seven of section two hundred
 ten or subsection (o) of section
 fourteen hundred fifty-six
 
 (xvi) QEZE tax reduction credit Amount of benefit period factor,
 under subsection (cc) employment increase factor and zone
  allocation factor (without regard
 to pro ration) under subdivision
 twenty-eight of section two hundred
 ten or subsection (p) of section
 fourteen hundred fifty-six and
 amount of tax factor as determined
 under subdivision (f) of section
  sixteen
 
 (xvii) Green building credit under Amount of green building credit
 subsection (y) under subdivision thirty-one of
 section two hundred ten or
  subsection (m) of section fourteen
 hundred fifty-six
 
 (xviii) Credit for long-term care Qualified costs under subdivision
 insurance premiums under subsection twenty-five-a of section two
 (aa) hundred ten or subsection (k) of
 section fourteen hundred fifty-six
 
 (xix) Brownfield redevelopment Amount of credit under subdivision
 credit under subsection (dd) thirty-three of section two hundred
 ten or subsection (q) of section
 fourteen hundred fifty-six
 
 (xx) Remediated brownfield credit Amount of credit under subdivision
 for real property taxes for thirty-four of section two hundred
 qualified sites under subsection ten or subsection (r) of section
 (ee) fourteen hundred fifty-six
 
 (xxi) Environmental remediation Amount of credit under subdivision
 insurance credit under subsection thirty-five of section two hundred
 (ff) ten or subsection (s) of section
 fourteen hundred fifty-six
 
 *(xxii) Empire state film Amount of credit for qualified
 production credit under production costs in production of a
 subsection (gg) qualified film under subdivision
  thirty-six of section two hundred
 ten
 * NB Repealed January 1, 2014
 
 (xxiii) Qualified emerging Qualifying expenditures and
 technology company facilities, development activities under
 operations and training credit subdivision twelve-G of section two
 under subsection (nn) hundred ten
 
 (xxiv) Security training tax credit Amount of credit under subdivision
 under subsection (ii) thirty-seven of section two hundred
 ten or under subsection (t) of
 section fourteen hundred fifty-six
 
 (xxv) Credit for qualified fuel For taxable years beginning before
 cell electric generating January first, two thousand nine,
 equipment expenditures amount of credit under subdivision
 under subsection (g-2) thirty-seven of section two hundred
  ten or subsection (t) of section
 fourteen hundred fifty-six
 
 *(xxvi) Empire state commercial Amount of credit for qualified
 production credit under subsection production costs in production of
 (jj)  a qualified commercial under
 subdivision thirty-eight of
 section two hundred ten
 * NB Repealed December 31, 2011
 
 (xxvii) Biofuel production tax Amount of credit under subdivision
 credit under subsection (jj) thirty-eight of section two hundred
 ten
 
 (xxviii) Clean heating fuel credit Amount of credit under subdivision
 under subsection (mm) thirty-nine of section two hundred
 ten
 
 (xxix) Credit for rehabilitation Amount of credit under subdivision
 of historic properties under forty of section two hundred ten
 subsection (oo)
 
 *(xxx) Credit for companies who Amount of credit under subdivision
 provide transportation to forty of section two hundred ten
 individuals with disabilities
 under subsection (oo)
 * NB Repealed December 31, 2010
 
 (2)  The reduction of a shareholder's proportionate interest in the
 corporation shall be treated as a disposition of property for which a
 redetermination of credit is required under subsections (a), (j) and (l)
 of this section.
 (3) Transition  provisions relating to S corporation credits allowed
 for taxable years beginning before nineteen hundred ninety-four. (A)
 Credit carryover. Any excess credit under subparagraph (A) of paragraph
 one of this subsection, as it was in effect for taxable years beginning
 before nineteen hundred ninety-four, may be carried over to the
 shareholder's following year or years and may be deducted from such
 shareholder's tax for such year or years, except that any excess credit
 attributable to subdivision twelve of section two hundred ten of this
 chapter shall in no event be carried over beyond the ten taxable years
 next following the taxable year of origin.
 (B) Credit recapture. Any redetermination of credit required by this
 subsection as it was in effect for taxable years beginning before
 nineteen hundred ninety-four, upon disposition or cessation of qualified
 use of property pursuant to paragraph (g) of subdivision twelve,
 paragraph (f) of subdivision twelve-B or paragraph (f) of subdivision
 eighteen of section two hundred ten of this chapter shall be attributed
 in pro rata shares to the shareholders who were allowed credit under
 this subsection with respect to such property, and the reduction of a
 shareholder's proportionate stock interest shall be treated as a
 disposition of property for which a redetermination of credit under such
 paragraphs is required with respect to such shareholder.
 (4) Transition provisions relating to credit for special additional
 mortgage recording tax. In the case of the special additional mortgage
 recording tax credit, in addition to any carryover thereof under
 paragraph three of this subsection (relating to carryover from taxable
 years of the shareholder beginning before nineteen hundred ninety-four),
 there also shall be allowed a credit for such tax which is due and paid
 by an S corporation in a taxable year of the corporation beginning in
 nineteen hundred ninety-three, which year ends within the shareholder's
 taxable year beginning in nineteen hundred ninety-four. Any such credit,
 and carryover thereof, shall be allowed as provided under this
 subsection as it was in effect for taxable years beginning before
 nineteen hundred ninety-four.
 (j) Empire zone investment tax credit (EZ-ITC). (1) A taxpayer shall
 be allowed a credit, to be computed as hereinafter provided, against the
 tax imposed by this article where the taxpayer has been certified
 pursuant to article eighteen-B of the general municipal law. The amount
 of such credit shall be eight 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 paragraph two of this subsection, 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, the credit shall be
 eight 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 subsection with respect to
 tangible personal property and other tangible property, including
 buildings and structural components of buildings which: (A) are
 depreciable pursuant to section one hundred sixty-seven of the internal
 revenue code, (B) have a useful life of four years or more, (C) are
 acquired by purchase as defined in section one hundred seventy-nine (d)
 of the internal revenue code, (D) have a situs in an empire zone
 designated as such pursuant to article eighteen-B  of the general
 municipal law, and (E) are (i) principally used by the taxpayer in the
 production of goods by manufacturing, processing, assembling, refining,
 mining, extracting, farming, agriculture, horticulture, floriculture,
 viticulture or commercial fishing, (ii) industrial waste treatment
 facilities or air pollution control facilities used in the taxpayer's
 trade or business, (iii) research and development property, (iv)
 principally used in the ordinary course of the taxpayer's trade or
 business as a broker or dealer in connection with the purchase or sale
 (which shall include but not be limited to the issuance, entering into,
 assumption, offset, assignment, termination, or transfer) of stocks,
 bonds or other securities as defined in section four hundred
 seventy-five (c)(2) of the Internal Revenue Code, or of commodities as
 defined in section four hundred seventy-five (e) of the Internal Revenue
 Code, or (v) principally used in the ordinary course of the taxpayer's
 trade or business of providing investment advisory services for a
 regulated investment company as defined in section eight hundred
 fifty-one of the Internal Revenue Code, or lending, loan arrangement or
 loan origination services to customers in connection with the purchase
 or sale (which shall include but not be limited to the issuance,
 entering into, assumption, offset, assignment, termination, or transfer)
 of securities as defined in section four hundred seventy-five (c)(2) of
 the Internal Revenue Code. For purposes of clauses (iv) and (v) of this
 subparagraph, property purchased by a taxpayer affiliated with a
 regulated broker, dealer or registered investment adviser is allowed a
 credit under this subsection if the property is used by its affiliated
 regulated broker, dealer or registered investment adviser in accordance
 with this subsection. For purposes of determining if the property is
 principally used in qualifying uses, the uses by the taxpayer described
 in clauses (iv) and (v) of this subparagraph may be aggregated. In
 addition, the uses by the taxpayer, its affiliated regulated broker,
 dealer, and registered investment adviser under either or both of those
 clauses may be aggregated. Provided, however, a taxpayer shall not be
 allowed the credit provided by clauses (iv) and (v) of this subparagraph
 unless (I) eighty percent or more of the employees performing the
 administrative and support functions resulting from or related to the
 qualifying uses of such equipment are located in this state, or (II) the
 average number of employees that perform the administrative and support
 functions resulting from or related to the qualifying uses of such
 equipment and are located in this state during the taxable year for
 which the credit is claimed is equal to or greater than ninety-five
 percent of the average number of employees that perform these functions
 and are located in this state during the thirty-six months immediately
 preceding the year for which the credit is claimed, or (III) the number
 of employees located in this state during the taxable year for which the
 credit is claimed is equal to or greater than ninety percent of the
 number of employees located in this state on December thirty-first,
 nineteen hundred ninety-eight or, if the taxpayer was not a calendar
 year taxpayer in nineteen hundred ninety-eight, the last day of its
 first taxable year ending after December thirty-first, nineteen hundred
 ninety-eight. If the taxpayer becomes subject to tax in this state after
 the taxable year beginning in nineteen hundred ninety-eight, then the
 taxpayer is not required to satisfy the employment test provided in the
 preceding sentence of this subparagraph for its first taxable year. For
 purposes of clause (III) of this subparagraph, the employment test will
 be based on the number of employees located in this state on the last
 day of the first taxable year the taxpayer is subject to tax in this
 state. If the uses of the property must be aggregated to determine
 whether the property is principally used in qualifying uses, then either
 each affiliate using the property must satisfy this employment test or
 this employment test must be satisfied through the aggregation of the
 employees of the taxpayer, its affiliated regulated broker, dealer, and
 registered investment adviser using the property. For purposes of this
 subsection, the term "goods" shall not include electricity. For purposes
 of this paragraph, manufacturing shall mean the process of working raw
 materials into wares suitable for use or which gives new shapes, new
 quality or new combination to matter which already has gone through some
 artificial process by the use of machinery, tools, appliances and other
  similar equipment. 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 paragraph,  the terms
 "research and development property", "industrial waste treatment
 facilities", and "air pollution control facilities" shall have the
 meanings ascribed thereto by clauses (ii), (iii) and (iv), respectively,
 of subparagraph (B) of paragraph two of subsection (a) of this section,
 and the provisions of subparagraph (C) of such paragraph two shall
 apply.
 (3) A taxpayer shall not be allowed a credit under this subsection
 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 except where a
 taxpayer leases property to an affiliated regulated broker, dealer, or
 registered investment adviser that uses such property in accordance with
 clause (iv) or (v) of subparagraph (E) of paragraph two of this
 subsection. 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 subsection 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) If the amount of credit allowed under this subsection for any
 taxable year shall exceed the taxpayer's tax for such year, the excess
 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 carrying over
 any such excess, a taxpayer who qualifies as an owner of a new business
 for purposes of paragraph ten of subsection (a) of this section may, at
 his option, receive fifty percent of such excess as a refund. Any refund
 paid pursuant to this paragraph shall be deemed to be a refund of an
 overpayment of tax as provided in section six hundred eighty-six of this
 article, provided, however, that no interest shall be paid thereon.
 (4-a) Any carry over of a credit from prior taxable years will not be
 allowed if an empire zone retention certificate is not issued pursuant
 to subdivision (w) of section nine hundred fifty-nine of the general
 municipal law to the empire zone enterprise which is the basis of the
 credit.
 (5) At the option of the taxpayer, air or water pollution control
 facilities which qualify for elective modifications under subsection (h)
 of section six hundred twelve, or research and development facilities
 which qualify for elective modification under paragraphs three and four
 of subsection (g) of section six hundred twelve, or property which
 qualifies for the credit provided under subsection (a) or (h) of this
 section may be treated as property principally used by the taxpayer in
 the production of goods by manufacturing, processing, assembling,
 mining, refining, extracting, farming, agriculture, horticulture,
 floriculture, viticulture, or commercial fishing, provided the property
 otherwise qualifies under paragraph two of this subsection, in which
 event a deduction shall not be allowed under such subsection (h) or such
 paragraphs three and four of subsection (g) and a credit shall not be
 allowed under such subsection (a) or (h).
 (6) (A) With respect to 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 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 the 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 subsection. 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 subsection, 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 subparagraph (D) of
 this paragraph applies, with respect to three-year property, as defined
 in subsection (e) 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 subsection 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 subparagraph (D) of
 this paragraph applies, with respect to property 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 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
 subsection 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 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 subsection 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 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 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 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 total
 number of months over which the taxpayer chooses to deduct the property
 under the internal revenue code.
 (E) For purposes of this paragraph, 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 paragraph, 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 paragraph 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 (j) of section six hundred ninety-seven 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 amount deducted from tax shall be established in accordance
 with the date of placement in service of such property in the empire
 zone.
 (iii) In no event shall the amount of the credit allowed pursuant to
 this subsection be rendered, solely by reason of clause (i) of this
 subparagraph, less than the amount of the credit to which the taxpayer
 would otherwise be entitled under subsection (a) of this section.
 (iv) Notwithstanding any other provision of this subsection, 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 paragraph four of this subsection 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 subsection
 was allowed.
 (G) For purposes of this paragraph, where a credit is allowed with
 respect to an air pollution control facility on the basis of a
 certificate of compliance issued pursuant to the environmental
 conservation law and the certificate is revoked pursuant to subdivision
 three of section 19-0309 of the environmental conservation law, such
 revocation shall constitute a disposal or cessation of qualified use,
 except with respect to property contained in or comprising such facility
 which is described in clause (i), (ii) or (iii) of subparagraph (E) of
 paragraph two of this subsection other than as part of or comprising an
 air pollution control facility. Also for purposes of this paragraph, the
 use of an air pollution control facility or an industrial waste
 treatment facility for the primary purpose of salvaging materials which
 are usable in the manufacturing process or are marketable shall
 constitute a cessation of qualified use, except with respect to property
 contained in or comprising such facility which is described in clause
 (i) or (iii) of subparagraph (E) of paragraph two of this subsection.
 (H) Except as provided in this subparagraph, this paragraph shall not
 apply to a credit allowed by this subsection to a taxpayer that is a
 partner in a partnership in the case of manufacturing property;
 provided, at the time such property was placed in service by such
 partnership in an empire zone the basis for federal income tax purposes
 of such property (or a project that includes such property) equaled or
 exceeded three hundred million dollars and such partner owned his or her
 partnership interest for at least three years from the date such
 property was placed in service. If such property ceases to be in
 qualified use after it is placed in service, this paragraph shall apply
 to such partner in the year such property ceases to be in qualifying
 use.
 (j-1) Empire zone employment incentive credit. (1) Where a taxpayer is
 allowed a credit under subsection (j) of this section, the taxpayer
 shall be allowed a credit for each of the three years next succeeding
 the taxable year for which the credit under such subsection (j) is
 allowed, with respect to such property, whether or not deductible in
 such taxable year or in subsequent taxable years pursuant to paragraph
 four of subsection (j) of this section, of thirty percent of the credit
 allowable under such subsection (j); provided, however, that the credit
 allowable under this subsection for any taxable year shall only be
 allowed if the average number of employees employed by the taxpayer in
 the empire zone, designated pursuant to article eighteen-B of the
 general municipal law, in which such property is located during such
 taxable year is at least one hundred one percent of the average number
 of employees employed by the taxpayer in such empire zone or, where
 applicable, in the geographic area subsequently constituting such zone,
 during the taxable year immediately preceding the taxable year for which
 the credit under such subsection (j) is allowed and provided, further,
 that in the case of a new business, the credit allowable under this
 subsection for any taxable year shall be allowed if the average number
 of employees employed in such empire zone in such taxable year is at
 least one hundred one percent of the average number of such employees
 during the taxable year in which the credit under such subsection (j) is
 allowed.
 (2) The average number of employees employed in an empire zone, or,
 where applicable, in the geographic area subsequently constituting such
 zone, in a taxable year shall be computed by ascertaining the number of
 such employees within such zone, or, where applicable, in the geographic
 area subsequently constituting such zone, employed by the taxpayer on
 the thirty-first day of March, the thirtieth day of June, the thirtieth
 day of September and the thirty-first day of December in the taxable
 year, by adding together the number of employees ascertained in each of
 such dates and dividing the sum so obtained by the number of such
 abovementioned dates occurring within the taxable year.
 (3) If the amount of credit allowed under this subsection for any
 taxable year shall exceed the taxpayer's tax for such year, the excess
 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 carrying over
 any such excess, a taxpayer who qualified as an owner of a new business
 for purposes of paragraph ten of subsection (a) of this section may, at
 his option, receive fifty percent of such excess as a refund. Any refund
 paid pursuant to this paragraph shall be deemed to be a refund of an
 overpayment of tax as provided in section six hundred eighty-six of this
 article, provided, however, that no interest shall be paid thereon.
 (3-a) Any carry over of a credit from prior taxable years will not be
 allowed to an empire zone enterprise which is the basis of the credit,
 if an empire zone retention certificate is not issued to such entity
 pursuant to subdivision (w) of section nine hundred fifty-nine of the
 general municipal law.
 (k) Empire zone wage tax credit. (1) A taxpayer shall be allowed a
 credit, to be computed as hereinafter provided, against the tax imposed
 by this article, where the taxpayer has been certified pursuant to
 article eighteen-B of the general municipal law. The amount of such
 credit shall be as prescribed in paragraph four of this subsection.
 (2) For the purposes of this subsection, the following terms shall
 have the following meanings: (A) "Empire zone wages" means wages paid by
 the taxpayer for full-time employment during the taxable year, in an
 area designated or previously designated as an empire zone or zone
 equivalent area pursuant to article eighteen-B of the general municipal
 law, where such employment is in a job created in the area (i) during
 the period of its designation as an empire zone, (ii) within four years
 of the expiration of such designation, or (iii) during the ten year
 period immediately following the date of designation as a zone
 equivalent area, provided, however, that if the taxpayer's certification
 under article eighteen-B of the general municipal law is revoked with
 respect to an empire zone or zone equivalent area, any wages paid by the
 taxpayer, on or after the effective date of such decertification, for
 employment in such zone shall not constitute empire zone wages.
 (B) "Targeted employee" means a New York resident who receives empire
 zone wages and who is (i) an eligible individual under the provisions of
 the targeted jobs tax credit (section fifty-one of the internal revenue
 code), (ii) eligible for benefits under the provisions of the workforce
 investment act as a dislocated worker or low-income individual (P.L.
 105-220, as amended), (iii) a recipient of public assistance benefits,
 (iv) an individual whose income is below the most recently established
 poverty rate promulgated by the United States department of commerce, or
 a member of a family whose family income is below the most recently
 established poverty rate promulgated by the appropriate federal agency
 or (v) an honorably discharged member of any branch of the armed forces
 of the United States.
 An individual who satisfies the criteria set forth in clause (i),
 (ii), (iv) or (v) at the time of initial employment in the job with
 respect to which the credit is claimed, or who satisfies the criterion
 set forth in clause (iii) at such time or at any time within the
 previous two years, shall be a targeted employee so long as such
 individual continues to receive empire zone wages.
 (C) "Average number of individuals employed full-time" shall be
 computed by ascertaining the number of such individuals employed by the
 taxpayer on the thirty-first day of March, the thirtieth  day of June,
 the thirtieth day of September and the thirty-first day of December
 during each taxable year or other applicable period, by adding together
 the number of such individuals ascertained on each of such dates and
 dividing the sum so obtained by the number of such dates occurring
 within such taxable year or other applicable period.
 (3) The credit provided for herein shall be allowed only where the
 average number of individuals employed full-time by the taxpayer in (i)
 the state and (ii) the empire zone or area previously constituting such
 zone or zone equivalent area, during the taxable year exceeds the
 average number of such individuals employed full-time by the taxpayer in
 (i) the state and (ii) such zone or area subsequently or previously
 constituting such zone or such zone equivalent area, respectively,
 during the four years immediately preceding the first taxable year in
 which the credit is claimed with respect to such zone or area. Where the
 taxpayer provided full-time employment within (i) the state or (ii) such
 zone or area during only a portion of such four-year period, then for
 purposes of this paragraph the term "four years" shall be deemed to
 refer instead to such portion, if any.
 The credit shall be allowed only with respect to the first taxable
 year during which payments of empire zone wages are made and the
 conditions set forth in this paragraph are satisfied, and with respect
 to each of the four taxable years next following (but only, with respect
 to each of such years, if such conditions are satisfied), in accordance
 with paragraph four of this subsection. Subsequent certifications of the
 taxpayer pursuant to article eighteen-B of the general municipal law, at
 the same or a different location in the same empire zone or zone
 equivalent area or at a location in a different empire zone or zone
 equivalent area, shall not extend the five taxable year time limitation
 on the allowance of the credit set forth in the preceding sentence.
 Provided, further, however, that no credit shall be allowed with respect
 to any taxable year beginning more than four years following the taxable
 year in which designation as an empire zone expired or more than ten
 years after the designation as a zone equivalent area.
 (4) The amount of the credit shall equal the sum of
 (i) the product of three thousand dollars and the average number of
 individuals employed full-time by the taxpayer, computed pursuant to the
 provisions of subparagraph (C) of paragraph two of this subsection, who
 (I) received empire zone wages for more than half of the taxable year,
 (II) received with respect to more than half of the period of
 employment by the taxpayer during the taxable year, an hourly wage which
 was at least one hundred thirty-five percent of the minimum wage
 specified in section six hundred fifty-two of the labor law, and
 (III) are targeted employees; and
 (ii) the product of fifteen hundred dollars and the average number of
 individuals (excluding individuals described in subparagraph (i) of this
 paragraph) employed full-time by the taxpayer, computed pursuant to the
 provisions of subparagraph (C) of paragraph two of this subsection, who
 received empire zone wages for more than half of the taxable year.
 Provided, further, however, that the credit provided for herein with
 respect to the taxable year, and carryovers of such credit to the
 taxable year, deducted from the tax otherwise due, may not, in the
 aggregate, exceed fifty percent of the tax imposed under section six
 hundred one computed without regard to any credit provided for under
 this article.
 (iii) For purposes of calculating the amount of the credit,
 individuals employed within an empire zone or zone equivalent area
 within the immediately preceding sixty months by a related person, as
 such term is defined in subparagraph (c) of paragraph three of
 subsection (b) of section four hundred sixty-five of the internal
 revenue code, shall not be included in the average number of individuals
 described in subparagraph (i) or subparagraph (ii) of this paragraph,
 unless such related person was never allowed a credit under this
 subsection with respect to such employees. For purposes of this
 subparagraph, a "related person" shall include an entity which would
 have qualified as a "related person" to the taxpayer if it had not been
 dissolved, liquidated, merged with another entity or otherwise ceased to
 exist or operate.
 (iv) If a taxpayer is certified in an empire zone designated under
 subdivision (a) or (d) of section nine hundred fifty-eight of the
 general municipal law, the dollar amounts specified under subparagraph
 (i) or (ii) of this paragraph shall be increased by five hundred dollars
 for each qualifying individual under such subparagraph who received,
 during the taxable year, wages in excess of forty thousand dollars.
 (v) The requirement in this paragraph that an employee must receive
 empire zone wages for more than half the taxable year shall not apply in
 the first taxable year of a taxpayer satisfying the criteria set forth
 in this subparagraph. In such a case, the credit allowed under  this
 subsection shall be computed by utilizing the number of individuals
 (excluding general executive officers) employed full time by the
 taxpayer on the last day of its first taxable year. A taxpayer shall
 satisfy the following criteria: (I) such taxpayer acquired real or
 tangible personal property during its first taxable year from an entity
 which is not a related person (as such term is defined in subdivision
 (g) of section fourteen of this chapter); (II) the first taxable year of
 such taxpayer shall be a short taxable year of not more than seven
 months in duration; and (III) the number of individuals employed
 full-time on the last day of such first taxable year shall be at least
 one hundred ninety and substantially all of such individuals must have
 been previously employed by the entity from whom such taxpayer purchased
 its assets.
 (5) If the amount of the credit and carryovers of such credit allowed
 under this subsection for any taxable year shall exceed the taxpayer's
 tax for such year, the excess, as well as any part of the credit or
 carryovers of such credit, or both, which may not be deducted from the
 tax otherwise due by reason of the final sentence in paragraph four
 hereof, 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
 carrying over any such excess, a taxpayer who qualifies as an owner of a
 new business for purposes of paragraph ten of subsection (a) of this
 section may, at his option, receive fifty percent of such excess as a
 refund. Any refund paid pursuant to this paragraph shall be deemed to be
 a refund of an overpayment of tax as provided in section six hundred
 eighty-six of this article, provided, however, that no interest shall be
 paid thereon.
 (5-a) Any carry over of a credit from prior taxable years will not be
 allowed if an empire zone retention certificate is not issued pursuant
 to subdivision (w) of section nine hundred fifty-nine of the general
 municipal law to the empire zone enterprise which is the basis of the
 credit.
 (l) Empire zone capital tax credit. (1) A taxpayer shall be allowed a
 credit against the tax imposed by this article. The amount of the credit
 shall be equal to twenty-five percent of the sum of the following
 investments and contributions made during the taxable year and certified
 by the commissioner of economic development: (A) for taxable years
 beginning before January first, two thousand five, qualified investments
 made in, or contributions in the form of donations made to, one or more
 empire zone capital corporations established pursuant to section nine
 hundred sixty-four of the general municipal law prior to January first,
 two thousand five, (B) qualified investments in certified zone
 businesses which during the twelve month period immediately preceding
 the month in which such investment is made employed full-time within the
 state an average number of individuals of two hundred fifty or fewer,
 computed pursuant to the provisions of subparagraph (C) of paragraph two
 of subsection (k) of this section, except for investments made by or on
 behalf of an owner of the business including, but not limited to, a
 stockholder, partner or sole proprietor, or any related person, as
 defined in subparagraph (C) of paragraph three of subsection (b) of
 section four hundred sixty-five of the internal revenue code, and (C)
 contributions of money to community development projects as defined in
 regulations promulgated by the commissioner of economic development.
 "Qualified investments" means the contribution of property to a
 corporation in exchange for original issue capital stock or other
 ownership interest, the contribution of property to a partnership in
 exchange for an interest in the partnership, and similar contributions
 in the case of a business entity not in corporate or partnership form in
 exchange for an ownership interest in such entity. The total amount of
 credit allowable to a taxpayer under this provision for all years, taken
 in the aggregate, shall not exceed three hundred thousand dollars, and
 shall not exceed one hundred thousand dollars with respect to the
 investments and contributions described in each of subparagraphs (A),
 (B) and (C) of this paragraph.
 (1-a) Any carry over of a credit from prior taxable years will not be
 allowed to an empire zone enterprise which is the basis of the credit,
 if an empire zone retention certificate is not issued to such entity
 pursuant to subdivision (w) of section nine hundred fifty-nine of the
 general municipal law.
 (2) (A) If the amount of the credit and carryovers of such credit
 allowed under this subsection for any taxable year shall exceed the
 taxpayer's tax for such year, or if any part of the credit or carryovers
 of such credit may not be deducted from the tax otherwise due by reason
 of the final sentence of this subparagraph, any amount of credit or
 carryovers of such credit thus not deductible in such taxable year may
 be carried over to the following year or years and may be deducted from
 the tax for such year or years. In addition, the amount of such credit,
 and carryovers of such credit to the taxable year, deducted from the tax
 otherwise due may not, in the aggregate, exceed fifty percent of the tax
 imposed under section six hundred one computed without regard to any
 credit provided for by this section.
 (B) In the case of a husband or wife who is required to file a
 separate return, the limitation provided for in paragraph one of this
 subsection shall be fifty thousand dollars in lieu of one hundred
 thousand dollars and one hundred fifty thousand dollars in lieu of three
 hundred thousand dollars, unless the spouse of the taxpayer has no
 credit allowable under this subsection for the taxable year of such
 spouse which ends within or with the taxpayer's taxable year.
 (C) In the case of an estate or trust, the limitation provided for in
 paragraph one of this subsection shall be reduced to an amount which
 bears the same ratio to one hundred thousand dollars and an amount which
 bears the same ratio to three hundred thousand dollars as the portion of
 the income of the estate or trust which is  not allocated to
 beneficiaries bears to the total income of the estate or trust.
 (3) Where the stock, partnership interest or other ownership interest
 arising from a qualified investment as described in subparagraphs (A)
 and (B) of paragraph one of this subsection is disposed of, the
 taxpayer's New York taxable income shall be computed, pursuant to
 regulations promulgated by the commissioner, so as to properly reflect
 the reduced cost thereof arising from the application of the credit
 provided for herein.
 (4) (A) Where a taxpayer sells, transfers or otherwise disposes of
 corporate stock, a partnership interest or other ownership interest
 arising from the making of a qualified investment which was the basis,
 in whole or in part, for the allowance of the credit provided for under
 this subsection, or where a contribution or investment which was the
 basis for such allowance is in any manner, in whole or in part,
 recovered by such taxpayer, and such disposition or recovery occurs
 during the taxable year or within thirty-six months from the close of
 the taxable year with respect to which such credit is allowed,
 subparagraph (B) of this paragraph shall apply.
 (B) The taxpayer shall add back with respect to the taxable year in
 which the disposition or recovery described in subparagraph (A) of this
 paragraph occurred the required portion of the credit originally
 allowed.
 (C) The required portion of the credit originally allowed shall be the
 product of (i) the portion of such credit attributable to the property
 disposed of or the payment or contribution recovered and (ii) the
 applicable percentage.
 (D) The applicable percentage shall be:
 (i) one hundred percent, if the disposition or recovery occurs within
 the taxable year with respect to which the credit is allowed or within
 twelve months of the end of such taxable year,
 (ii) sixty-seven percent, if the disposition or recovery occurs more
 than twelve but not more than twenty-four months after the end of the
 taxable year with respect to which the credit is allowed, or
 (iii) thirty-three percent, if the disposition or recovery occurs more
 than twenty-four but not more than thirty-six months after the end of
 the taxable year with respect to which the credit is allowed.
 (m) Excess deductions credit. (1) General. For taxable years beginning
  in nineteen hundred ninety-five, an excess deductions credit shall be
 allowed against the tax determined under subsections (a) through (d) of
 section six hundred one of this article. The credit shall be allowed to
 an individual taxpayer whose New York itemized deduction determined
 under section six hundred fifteen (whether or not the taxpayer elects
 the New York itemized deduction for the taxable year) exceeds the base
 amount determined under paragraph two hereof. The credit  shall not
 exceed the tax determined under subsections (a) through (d) of section
 six hundred one for the taxable year, reduced by the credits permitted
 under subsection (c) of this section and sections six hundred twenty and
 six hundred twenty-one of this article.
 (2) Base amount. The base amount shall be determined by the taxpayer's
 standard deduction status under section six hundred fourteen (whether or
 not the taxpayer employs the standard deduction for the taxable year) as
 follows:
 
 If the taxpayer's standard The base amount is:
 deduction status is:
 
 Unmarried individual who is
 not a head of household nor a
 surviving spouse nor an
 individual whose federal
 exemption amount is zero $6,000
 Husband and wife whose New York
 taxable income is determined
 jointly, or a surviving spouse $9,500
 
 Head of household $7,000
 
 Married individual filing a
 separate New York return $4,750
 
 (3) Credit amount.
 (A) Married individuals filing joint returns and surviving spouses.
 The amount of the credit allowed pursuant to this subsection for married
 individuals filing jointly under subsection (b) of section six hundred
 fifty-one and for a surviving spouse shall be:
 
 If New York taxable income is: The credit is the following
 percentage of New York
 taxable income:
 Not over $11,500 0.57%
 Over $11,500 but not over $17,500 0.51%
 Over $17,500 but not over $24,100  0.36%
 Over $24,100 but not over $31,500 0.26%
 Over $31,500 but not over $35,500 0.16%
 Over $35,500 but not over $42,000 0.11%
 Over $42,000 but not over $49,000 0.06%
 Over $49,000 0.00%
 
 (B) Heads of households. The amount of the credit allowed pursuant to
 this subsection for a head of household shall be:
 
 If New York taxable income is: The credit is the following
 percentage of New York
 taxable income:
 Not over $7,600 0.57%
 Over $7,600 but not over $11,700 0.51%
  Over $11,700 but not over $16,400 0.36%
 Over $16,400 but not over $20,500 0.26%
 Over $20,500 but not over $23,800 0.16%
 Over $23,800 but not over $28,650 0.11%
 Over $28,650 but not over $33,400 0.06%
 Over $33,400 0.00%
 
 (C) Unmarried individuals and married individuals filing separate
 returns. The amount of the credit allowed pursuant to this subsection
  for an individual who is not a married individual filing jointly under
 subsection (b) of section six hundred fifty-one nor a head of a
 household nor a surviving spouse shall be:
 
 If New York taxable income is: The credit is the following
 percentage of New York
 taxable income:
 Not over $5,600 0.57%
 Over $5,600 but not over $8,600  0.51%
 Over $8,600 but not over $12,000 0.36%
 Over $12,000 but not over $15,700 0.26%
 Over $15,700 but not over $17,600 0.16%
 Over $17,600 but not over $21,000 0.11%
 Over $21,000 but not over $24,500 0.06%
 Over $24,500 0.00%
 
 (n) Agricultural property tax credit. (1) General. In the case of a
 taxpayer who is an eligible farmer or an eligible farmer who has paid
 taxes pursuant to a land contract, there shall be allowed a credit for
 the allowable school district property taxes. The term "allowable school
 district property taxes" means the school district property taxes paid
 during the taxable year on qualified agricultural property, subject to
 the acreage limitation provided in paragraph five of this subsection and
 the income limitation provided in paragraph six of this subsection. Such
 credit shall be allowed against the taxes imposed by this article for
 the taxable year reduced by the credits permitted by this article. If
 the credit exceeds the tax as so reduced, the taxpayer may receive, and
 the comptroller, subject to a certificate of the commissioner, shall pay
 as an overpayment, without interest, the amount of such excess.
 (2) Eligible farmer. For purposes of this subsection, the term
 "eligible farmer" means a taxpayer whose federal gross income from
 farming for the taxable year is at least two-thirds of excess federal
 gross income. The term "eligible farmer" also includes an individual
 other than the taxpayer of record for qualified agricultural land who
 has paid the school district property taxes on such land pursuant to a
 contract for the future purchase of such land; provided that such
 individual has a federal gross income from farming for the taxable year
 which is at least two-thirds of excess federal gross income; and
 provided further that, in determining such income eligibility, a
 taxpayer may, for any taxable year, use the average of such federal
 gross income from farming for that taxable year and such income for the
 two consecutive taxable years immediately preceding such taxable year.
 Excess federal gross income means the amount of federal gross income
 from all sources for the taxable year reduced by the sum (not to exceed
 thirty thousand dollars) of those items included in federal gross income
 which consist of (i) earned income, (ii) pension payments, including
 social security payments, (iii) interest, and (iv) dividends. For
 purposes of this paragraph, the term "earned income" shall mean wages,
 salaries, tips and other employee compensation, and those items of gross
 income which are includible in the computation of net earnings from
 self-employment.
 (3) School district property taxes. For purposes of this subsection,
 the term "school district property taxes" means all property taxes,
 special ad valorem levies and special assessments, exclusive of
 penalties and interest, levied for school district purposes on the
 qualified agricultural property (A) owned by the taxpayer or (B) owned
 by the father, mother, grandfather, grandmother, brother or sister of
 the taxpayer and a written agreement expressing intent to eventually
 purchase the land has been entered into.
 (4) Qualified agricultural property. For purposes of this subsection,
 the term "qualified agricultural property" means land located in this
 state which is used in agricultural production, and land improvements,
 structures and buildings (excluding buildings used for the taxpayer's
 residential purpose) located on such land which are used or occupied to
 carry out such production. Qualified agricultural property also includes
 land set aside or retired under a federal supply management or soil
 conservation program or land that at the time it becomes subject to a
 conservation easement, as defined under subsection (kk) of this section,
 met the requirements under this paragraph.
 (5) Acreage limitation. (A) Eligible taxes. In the event that the
 qualified agricultural property owned by the taxpayer includes land in
 excess of the base acreage as provided in this paragraph, the amount of
 school district property taxes eligible for credit under this subsection
 shall be that portion of the school district property taxes which bears
 the same ratio to the total school district property taxes paid during
 the taxable year, as the acreage allowable under this paragraph bears to
 the entire acreage of such land.
 (B) Allowable acreage. The allowable acreage is the sum of the base
 acreage set forth below and fifty percent of the incremental acreage.
 The incremental acreage is the excess of the entire acreage of qualified
 agricultural land owned by the taxpayer over the base acreage. Except as
 provided in subparagraph (C) of this paragraph:
 
 For taxable years beginning: The base acreage is:
 in 1997 100
 after 1997 but before 2006 250
 2006 and thereafter  350
 
 For taxable years beginning after two thousand, total base acreage may
 be increased by any acreage enrolled or participating during the taxable
 year in a federal environmental conservation acreage reserve program
 pursuant to title three of the federal agriculture improvement and
 reform act of nineteen hundred ninety-six.
 (C) Base acreage of related persons. Where the taxpayer and one or
 more related persons each own qualified agricultural property on the
 first day of March of any year, the base acreage under subparagraph (B)
 of this paragraph shall be divided equally and allotted among the
 taxpayer and such related persons, and the taxpayer's base acreage for
 the taxable year which includes such March first shall be limited to its
 allotted share. Provided, however, if the taxpayer and all such related
 persons consent (at such time and in such manner as the commissioner may
 prescribe) to an unequal division, the taxpayer's base acreage for such
 taxable year shall be limited to its allotted share under such unequal
 division.
 (D) Related persons. (i) For purposes of subparagraph (C) of this
 paragraph, the term "related person" means:
 (I) a spouse;
 (II) a corporation subject to tax under article nine-A of this
 chapter, where more than fifty percent in value of the outstanding stock
 of the corporation is owned, directly or indirectly, by or for the
 taxpayer, or, where the taxpayer is a trust, where such stock is owned
 directly or indirectly by or for the grantor of such trust;
 (III) a partnership, estate or trust of which the taxpayer owns,
 directly or indirectly, more than fifty percent of the capital, profits
 or beneficial interest.
 (ii) For purposes of subparagraph (C) of this paragraph, where the
 taxpayer is an estate or trust, the term "related person" shall also
 mean a corporation subject to tax under article nine-A of this chapter,
 a partnership, an estate or trust:
 (I) where more than fifty percent of the beneficial interest in the
 taxpayer is owned, directly or indirectly, by or for such corporation,
 partnership, estate or trust or by or for the grantor of such trust; or
  (II) if the same person owns more than fifty percent of the beneficial
 interest in the taxpayer and more than fifty percent in value of the
 outstanding stock of the corporation, or more than fifty percent of the
 capital or profits interest in  the partnership, or more than fifty
 percent of the beneficial interest in the estate or trust.
 (iii) In determining whether a person is a related person within the
 meaning of this subparagraph:
 (I) stock owned, directly or indirectly, by or for a corporation,
 partnership, estate or trust shall be considered as being owned
 proportionately by or for its shareholders, partners or beneficiaries;
 (II) an individual shall be considered as owning the stock owned,
 directly or indirectly, by or for his spouse;
 (III) stock constructively owned by a person by reason of the
 application of item (I) of this clause shall, for the purpose of
 applying item (I) or (II) of this clause, be treated as actually owned
 by such person.
 (6) Income limitation. (A) In the event that the modified New York
 adjusted gross income of the taxpayer exceeds one hundred thousand
 dollars for taxable years beginning before two thousand six or two
 hundred thousand dollars for taxable year two thousand six and
 thereafter, the allowable school district property taxes under paragraph
 one of this subsection shall be the eligible taxes under subparagraph
 (A) of paragraph five of this subsection reduced by the product of the
 amount of such eligible taxes and a percentage, such percentage to be
 determined by multiplying one hundred percent by a fraction, the
 numerator of which is the lesser of fifty thousand dollars for taxable
 years beginning before two thousand six or one hundred thousand dollars
 for taxable year two thousand six and thereafter or the excess of the
 taxpayer's modified New York adjusted gross income over one hundred
 thousand dollars for taxable years beginning before two thousand six or
 two hundred thousand dollars for taxable year two thousand six and
 thereafter and the denominator of which is fifty thousand dollars for
 taxable years beginning before two thousand six or one hundred thousand
 dollars for taxable year two thousand six and thereafter. For purposes
 of the preceding sentence, the term "eligible taxes", where the acreage
 limitation of paragraph five of this subsection does not apply, shall
 mean the total school district property taxes paid during the taxable
 year.
 (B) The term "modified New York adjusted gross income" means the New
 York adjusted gross income for the taxable year reduced by the amount of
 principal paid on farm indebtedness during the taxable year. The term
 "farm indebtedness" means debt incurred or refinanced which is secured
 by farm property, where the proceeds of the debt are disbursed for
 expenditures incurred in the business of farming.
 (7) Nonqualified use. (A) No credit in conversion year. In the event
 that qualified agricultural property is converted by the taxpayer to
 nonqualified use, credit under this subsection shall not be allowed with
 respect to such property for the taxable year of conversion (the
 conversion year).
 (B) Credit recapture. If the conversion by the taxpayer of qualified
 agricultural property to nonqualified use occurs during the period of
 the two taxable years following the taxable year for which the credit
 under this subsection was first claimed with respect to such property,
 the credit allowed with respect to such property for the taxable years
 prior to the conversion year must be added back in the conversion year.
 Where the property converted includes land, and where the conversion is
 of only a portion of such land, the credit allowed with respect to the
 property converted shall be determined by multiplying the entire credit
 under this subsection for the taxable years prior to the conversion year
 by a fraction, the numerator of which is the acreage converted and the
 denominator of which is the entire acreage of such land owned by the
 taxpayer immediately prior to the conversion.
 (C) Exception to recapture. Subparagraph (B) of this paragraph shall
 not apply to the conversion of property where the conversion is by
 reason of involuntary conversion, within the meaning of section one
 thousand thirty-three of the internal revenue code.
 (D) Conversion to nonqualified use. For purposes of this paragraph, a
 sale or other disposition of qualified agricultural property alone shall
 not constitute a conversion to a nonqualified use.
  (8) Special rules. For purposes of this subsection, the term "federal
 gross income from farming" shall include gross income from the
 production of maple syrup, cider, Christmas trees derived from a managed
 Christmas tree operation whether dug for transplanting or cut from the
 stump, or from a commercial horse boarding operation as defined in
 subdivision thirteen of section three hundred one of the agriculture and
 markets law, or from the sale of wine from a licensed farm winery as
 provided for in article six of the alcoholic beverage control law.
 (9) Election to deem gross income of New York C corporation to
 shareholders. (A) General. For purposes of the credit under this
 subsection, the shareholders of an eligible corporation may elect to
 take into account their pro rata shares of the corporation's income and
 principal payments on farm indebtedness as provided in subparagraph (B)
 of this paragraph, for the taxable year of the corporation ending with
 or within the taxable year of each shareholder. No election under this
 paragraph shall be effective unless shareholders holding more than
 one-half, by vote and value, of the shares of stock of the corporation
 on the day on which the election is made have so elected.
 (B) Inclusion in gross and adjusted gross income. (i) For any taxable
 year of the corporation for which the election under this paragraph is
 in effect, the shareholders of the corporation shall include:
 (I) in gross income, for purposes of paragraph two of this subsection,
 their pro rata shares of the corporation's gross income, which income
 shall have the same character as in the hands of the corporation, and
 (II) in adjusted gross income, for purposes of paragraph six of this
 subsection, their pro rata shares of the corporation's entire net
 income, and
 (III) in principal payments on farm indebtedness, for purposes of
 paragraph six of this subsection, their pro rata shares of such payments
 made by the corporation.
 (ii) Tiered New York C and New York S corporation. In the event that a
 shareholder of the corporation is a New York S corporation, the New York
 S corporation shall make the inclusions prescribed by clause (i) of this
 subparagraph (except that the inclusion prescribed by subclause (II) of
 such clause shall be in the entire net income of the New York S
 corporation), and the New York S corporation shall pass through such
 inclusions in pro rata shares to its shareholders for purposes of their
 calculation of credit under this subsection.
 (C) Eligible corporation. The term "eligible corporation" means a
 corporation subject to tax under article nine-A of this chapter which is
 a New York C corporation for federal income tax purposes.
 (D) Pro rata share. For purposes of this paragraph, the pro rata share
 of any item of income or farm indebtedness principal payments for a
 taxable year of the corporation shall be determined with respect to a
 shareholder by assigning an equal portion of the item to each day of
 such taxable year, and then by dividing that portion pro rata among the
 shares outstanding on such day.
 (E) Election. (i) An election under subparagraph (A) of this paragraph
 shall be made on such form and in such manner as the commissioner may
 prescribe.
 (ii) When made. Such election shall be made no later than the due date
 of the corporation tax return (determined without regard to extensions)
 for the corporation's taxable year for which the election is to be
 effective.
 (iii) When effective. Such election shall be effective for the taxable
 year of the corporation for which it is made and for all succeeding
 taxable years of the corporation, until such election is terminated
 under subparagraph (F) of this paragraph.
 (F) Termination. (i) Revocation. An election under subparagraph (A) of
 this paragraph shall be terminated if shareholders holding more than
 one-half, by vote and value, of the shares of stock of the corporation
 on the day on which the revocation is made revoke the election. Such
 revocation shall be made on such form and in such manner as the
 commissioner may prescribe, and shall be effective on the first day of
 the corporation's taxable year following the date on which the
 revocation is made.
 (ii) Ineligible corporation. An election under subparagraph (A) of
 this paragraph shall be terminated on the first day of the corporation's
 taxable year with respect to which the corporation ceases to be an
 eligible corporation.
 (G) Election after termination. If an election is terminated under
 subparagraph (F) of this paragraph, no further election under
 subparagraph (A) of this paragraph shall be made before the fifth
 taxable year of the corporation following the taxable year during which
 the termination occurred, unless the commissioner consents to such
 election.
 (H) Waiver of secrecy. The commissioner shall have authority to reveal
 to shareholders of the corporation any information with respect to
 income or farm indebtedness principal payments of the corporation, for
 any taxable year of the corporation for which the election under this
 paragraph is in effect, which is the basis for denial in whole or in
 part of the credit claimed by such shareholders.
 (o) Credit for employment of persons with disabilities. (1) Allowance
 of credit. A taxpayer shall be allowed a credit, to be computed as
 hereinafter provided, against the tax imposed by this article, for
 employing within the state a qualified employee.
 (2) Qualified employee. A qualified employee is an individual:
 (A) who is certified by the education department, or in the case of an
 individual who is blind or visually handicapped, by the state agency
 responsible for provision of vocation rehabilitation services to the
 blind and visually handicapped: (i) as a person with a disability which
 constitutes or results in a substantial handicap to employment and (ii)
 as having completed or as receiving services under an individualized
 written rehabilitation plan approved by the education department or
 other state agency responsible for providing vocational rehabilitation
 services to such individual; and
 (B) who has worked on a full-time basis for the employer who is
 claiming the credit for at least one hundred eighty days or four hundred
 hours.
 (3) Amount of credit. Except as provided in paragraph four of this
 subsection, the amount of credit shall be thirty-five percent of the
 first six thousand dollars in qualified first-year wages earned by each
 qualified employee. "Qualified first-year wages" means wages paid or
 incurred by the taxpayer during the taxable year to qualified employees
 which are attributable, with respect to any such employee, to services
 rendered during the one-year period beginning with the day the employee
 begins work for the taxpayer.
 (4) Credit where federal work opportunity tax credit applies. With
 respect to any qualified employee whose qualified first-year wages under
 paragraph three of this subsection also constitute qualified first-year
 wages for purposes of the work opportunity tax credit for vocational
 rehabilitation referrals under section fifty-one of the internal revenue
 code, the amount of credit under this subsection shall be thirty-five
 percent of the first six thousand dollars in qualified second-year wages
 earned by each such employee. "Qualified second-year wages" means wages
 paid or incurred by the taxpayer during the taxable year to qualified
 employees which are attributable, with respect to any such employee, to
 services rendered during the one-year period beginning one year after
 the employee begins work for the taxpayer.
 (5) Carryover. If the amount of credit allowable under this subsection
 for any taxable year shall exceed the taxpayer's tax for such year, the
 excess may be carried over to the following year or years, and may be
 deducted from the taxpayer's tax for such year or years.
 (6) Coordination with federal work opportunity tax credit. The
 provisions of sections fifty-one and fifty-two of the internal revenue
 code, as such sections applied on October first, nineteen hundred
 ninety-six, that apply to the work opportunity tax credit for vocational
 rehabilitation referrals shall apply to the credit under this subsection
 to the extent that such sections are consistent with the specific
 provisions of this subsection, provided that in the event of a conflict
 the provisions of this subsection shall control.
 (p) Alternative fuels credit. (1) General. A taxpayer shall be allowed
 a credit, to be computed as hereinafter provided, against the tax
 imposed by this article, for alternative fuel vehicle refueling property
 placed in service during the taxable year.
 (2) Alternative fuel vehicle refueling property. The credit under this
 subsection for clean-fuel vehicle refueling property shall equal fifty
 percent of the cost of any such property
 (A) which is located in this state and
 (B) for which a credit is allowed under section thirty C of the
 internal revenue code but not including alternative fuel vehicle
 refueling property relating to a qualified hybrid vehicle as such
 vehicle is defined in subparagraph (B) of paragraph three of this
 subsection.
 (3) Definitions. (A) The term "alternative fuel vehicle refueling
 property" means any such property which is qualified within the meaning
 of section thirty C of the internal revenue code, but such term shall
 not include alternative fuel vehicle refueling property relating to a
 qualified hybrid vehicle as such vehicle is defined in subparagraph (B)
 of this paragraph.
 (B) The term "qualified hybrid vehicle" means a motor vehicle, as
 defined in section one hundred twenty-five of the vehicle and traffic
 law,, that:
 (i) draws propulsion energy from both
  (a) an internal combustion engine (or heat engine that uses
 combustible fuel); and
 (b) an energy storage device; and
 (ii) employs a regenerative vehicle braking system that recovers waste
 energy to charge such energy storage device.
 (4) Carryovers. If the amount of credit allowable under this
 subsection shall exceed the taxpayer's tax for such year, the excess may
 be carried over to the following year or years and may be deducted from
 the taxpayer's tax for such year or years.
 (5) Credit recapture. (A) Vehicles.
 (i) If, within three full years from the date a qualified hybrid
 vehicle or a vehicle of which alternative fuel vehicle property is a
 part is placed in service, such qualified hybrid vehicle or vehicle of
 which alternative fuel vehicle property is a part ceases to be
 qualified, a recapture amount must be added back in the tax year in
 which such cessation occurs.
 (ii) Cessation of qualification. (I) A qualified hybrid vehicle ceases
 to be qualified if
 (a) it is modified by the taxpayer so that it no longer meets the
 requirements of a qualified hybrid vehicle as defined in subparagraph
 (B) of paragraph three of this subsection.
 (b) the taxpayer receiving the credit under this subsection sells or
 disposes of the vehicle and knows or has reason to know that the vehicle
 will be so modified.
 (B) Alternative fuel vehicle refueling property. (i) If, at any time
 before the end of its recovery period, alternative fuel vehicle
 refueling property ceases to be qualified, a recapture amount must be
 added back in the year in which such cessation occurs.
 (ii) Cessation of qualification. Clean-fuel vehicle refueling property
 ceases to be qualified if
 (I) the property no longer qualifies as property described in section
 thirty C of the internal revenue code, or
 (II) fifty percent or more of the use of the property in  a taxable
 year is other than in a trade or business in this state, or
 (III) the taxpayer receiving the credit under this subsection sells or
 disposes of the property and knows or has reason to know that the
 property will be used in a manner described in item (I) or (II) of this
 clause.
 (iii) Recapture amount. The recapture amount is equal to the credit
 allowable under this subsection multiplied by a fraction, the numerator
 of which is the total recovery period for the property minus the number
 of recovery years prior to, but not including, the recapture year, and
 the denominator of which is the total recovery period.
 (6) Termination. The credit allowed by paragraph two of this
 subsection shall not apply in taxable years beginning after December
 thirty-first, two thousand ten.
 (q) Qualified emerging technology company employment credit. (1) A
 taxpayer shall be allowed a credit, to be computed as hereinafter
 provided, against the tax imposed by this article, provided:
 (A) the taxpayer is a sole proprietor of a qualified emerging
 technology company, a member of a partnership which is a qualified
 emerging technology company, or a shareholder of a New York S
 corporation which is a qualified emerging technology company, as defined
 in section thirty-one hundred two-e of the public authorities law; and
 (B) the average number of individuals employed full-time by such
 company in New York  state during the taxable year is at least one
 hundred one percent of such company's base year employment. For the
 purposes of this subsection, "base year employment" means the average
 number of individuals employed full-time by such company in the state
 during the three taxable years immediately preceding the first taxable
 year in which the credit is claimed. Where such company provided
 full-time employment within the state during only a portion of such
 three-year period, then for purposes of this subsection, the term "three
 years" shall be deemed to refer instead to such portion, provided,
 however, the first taxable year for which this credit may be taken with
 respect to such company shall be the next year following the first full
 taxable year that such company had full-time employment in New York
 state.
 (2) The credit shall be allowed only in the first taxable year in
 which the credit is claimed and in each of the next two taxable years,
 provided that the conditions of paragraph one of this subsection are
 satisfied in each taxable year.
 (3) For the purposes of this subsection, average number of individuals
 employed full-time shall be computed by adding the number of such
 individuals employed by such company at the end of each quarter during
 each taxable year or other applicable period and dividing the sum so
 obtained by the number of such quarters occurring within such taxable
 year or other applicable period; provided, however, that in computing
 base year employment there shall be excluded therefrom any employee with
 respect to whom a credit provided for under subsection (k) of this
 section is claimed for the taxable year.
 (4) The amount of the credit shall equal the product of one thousand
 dollars multiplied by the number of individuals employed full-time by
 such company in the taxable year that are in excess of one hundred
 percent of such company's base year employment.
 (5) If the amount of credit allowed under this subsection for any
 taxable year shall exceed the taxpayer's tax for such year, the excess
 shall be treated as an overpayment of tax to be credited or refunded in
 accordance with the provisions of section six hundred eighty-six of this
 article, provided, however, that no interest shall be paid thereon.
 (r) Qualified emerging technology company capital tax credit. (1) A
 taxpayer shall be allowed a credit against the tax imposed by this
 article. The amount of the credit shall be equal to one of the following
 percentages, per each qualified investment in a qualified emerging
 technology company as defined in section thirty-one hundred two-e of the
 public authorities law, made during the taxable year, and certified by
 the commissioner, either:
 (A) ten percent of qualified investments in qualified emerging
 technology companies, except for investments made by or on behalf of an
 owner of the business, including, but not limited to, a stockholder,
 partner or sole proprietor, or any related person, as defined in
 subparagraph (C) of paragraph three of subsection (b) of section four
 hundred sixty-five of the internal revenue code, and provided, however,
 that the taxpayer certifies to the commissioner that the qualified
 investment will not be sold, transferred, traded, or disposed of during
 the four years following the year in which the credit is first claimed;
 or
 (B) twenty percent of qualified investments in qualified emerging
 technology companies, except for investments made by or on behalf of an
 owner of the business, including, but not limited to, a stockholder,
 partner or sole proprietor, or any related person, as defined in
 subparagraph (C) of paragraph three of subsection (b) of section four
 hundred sixty-five of the internal revenue code, and provided, however,
 that the taxpayer certifies to the commissioner that the qualified
 investment will not be sold, transferred, traded, or disposed of during
 the nine years following the year in which the credit is first claimed.
 (C) "Qualified investment" means the contribution of property to a
 corporation in exchange for original issue capital stock or other
 ownership interest, the contribution of property to a partnership in
 exchange for an interest in the partnership, and similar contributions
 in the case of a business entity not in corporate or partnership form in
 exchange for an ownership interest in such entity. The total amount of
 credit allowable to a taxpayer under this provision for all years, taken
 in the aggregate, shall not exceed one hundred fifty thousand dollars in
 the case of investments made pursuant to subparagraph (A) of this
 paragraph and shall not exceed three hundred thousand dollars in the
 case of investments made pursuant to subparagraph (B) of this paragraph.
 (2) (A) If the amount of the credit and carryovers of such credit
 allowed under this subsection for any taxable year shall exceed the
 taxpayer's tax for such year, any amount of credit or carryovers of such
 credit thus not deductible in such taxable year may be carried over to
 the following year or years and may be deducted from the tax for such
 year or years. In addition, the amount of such credit, and carryovers of
 such credit to the taxable year, deducted from the tax otherwise due may
 not, in the aggregate, exceed fifty percent of the tax imposed under
 section six hundred one computed without regard to any credit provided
 for by this section.
 (B) In the case of a husband or wife who is required to file a
 separate return, the limitations provided for in subparagraph (c) of
 paragraph one of this subsection shall be seventy-five thousand dollars
 in lieu of one hundred fifty thousand dollars, and one hundred fifty
 thousand dollars in lieu of three hundred thousand dollars, unless the
 spouse of the taxpayer has no credit allowable under this subsection for
 the taxable year of such spouse which ends within or with the taxpayer's
 taxable year.
 (C) In the case of an estate or trust, the limitations provided for in
 paragraph one of this subsection shall be reduced to an amount which
 bears the same ratio to one hundred fifty thousand dollars and an amount
 which bears the same ratio to three hundred thousand dollars as the
 portion of the income of the estate or trust which is not allocated to
 beneficiaries bears to the total income of the estate or trust.
 (3) (A) Where a taxpayer sells, transfers or otherwise disposes of
 corporate stock, a partnership interest or other ownership interest
 arising from the making of a qualified investment which was the basis,
 in whole or in part, for the allowance of the credit provided for under
 subparagraph (A) of paragraph one of this subsection, or where an
 investment which was the basis for such allowance is, in whole or in
 part, recovered by such taxpayer, and such disposition or recovery
 occurs during the taxable year or within forty-eight months from the
 close of the taxable year with respect to which such credit is allowed,
 the taxpayer shall add back, with respect to the taxable year in which
 the disposition or recovery described above occurred, the required
 portion of the credit originally allowed.
 (B) Where a taxpayer sells, transfers or otherwise disposes of
 corporate stock, a partnership interest or other ownership interest
 arising from the making of a qualified investment which was the basis,
 in whole or in part, for the allowance of the credit provided for under
 subparagraph (B) of paragraph one of this subsection, or where an
 investment which was the basis for such allowance is in any manner, in
 whole or in part, recovered by such taxpayer, and such disposition or
 recovery occurs during the taxable year or within one hundred eight
 months from the close of the taxable year with respect to which such
 credit is allowed, the taxpayer shall add back, with respect to the
 taxable year in which the disposition or recovery described in
 subparagraph one of this paragraph occurred the required portion of the
 credit originally allowed.
 (C) The required portion of the credit originally allowed shall be the
 product of (i) the portion of such credit attributable to the property
 disposed of and (ii) the applicable percentage.
 (D) The applicable percentage shall be:
 (i) for credits allowed pursuant to subparagraph (A) of paragraph one
 of this subsection:
 (I) one hundred percent, if the disposition or recovery occurs within
 the taxable year with respect to which the credit is allowed or within
 twelve months of the end of such taxable year,
 (II) seventy-five percent, if the disposition or recovery occurs more
 than twelve but not more than twenty-four months after the end of the
 taxable year with respect to which the credit is allowed,
 (III) fifty percent, if the disposition or recovery occurs more than
 twenty-four months but not more than thirty-six months after the end of
 the taxable year with respect to which the credit is allowed, or
 (IV) twenty-five percent, if the disposition or recovery occurs more
 than thirty-six months but not more than forty-eight months after the
 end of the taxable year with respect to which the credit is allowed; or
 (ii) for credits allowed pursuant to subparagraph (B) of paragraph one
 of this subsection:
 (I) one hundred percent, if the disposition or recovery occurs within
 the taxable year with respect to which the credit is allowed or within
 twelve months of the end of such taxable year,
 (II) eighty percent, if the disposition or recovery occurs more than
 twelve but not more than forty-eight months after the end of the taxable
 year with respect to which the credit is allowed,
 (III) sixty percent, if the disposition or recovery occurs more than
 forty-eight months but not more than seventy-two months after the end of
 the taxable year with respect to which the credit is allowed,
 (IV) forty percent, if the disposition or recovery occurs more than
 seventy-two months but not more than ninety-six months after the end of
 the taxable year with respect to which the credit is allowed, or
 (V) twenty percent, if the disposition or recovery occurs more than
 ninety-six months but not more than one hundred eight months after the
 end of the taxable year with respect to which the credit is allowed.
 (s) Credit for purchase of an automated external defibrillator. A
 taxpayer shall be allowed a credit as hereinafter provided, against the
 tax imposed by this article for the purchase, other than for resale, of
 an automated external defibrillator, as such term is defined in section
 three thousand-b of the public health law. The amount of credit shall be
 the cost to the taxpayer of automated external defibrillators purchased
 during the taxable year, such credit not to exceed five hundred dollars
 with respect to each unit purchased.
 (t) College tuition credit. (1) General. A resident taxpayer shall be
 allowed the option of claiming a credit, to be computed as provided in
 paragraph four of this subsection, against the tax imposed by this
 article, or an itemized deduction, to be computed as provided in
 paragraph four of subsection (d) of section six hundred fifteen of this
 article, for allowable college tuition expenses.
  (2) Allowable and qualified college tuition expenses. For the purposes
 of this credit and the itemized deduction provided by paragraph four of
 subsection (d) of section six hundred fifteen of this article:
 (A) The term "allowable college tuition expenses" shall mean the
 amount of qualified college tuition expenses of eligible students paid
 by the taxpayer during the taxable year, limited to ten thousand dollars
 for each such student;
 (B) The term "eligible student" shall mean the taxpayer, the
 taxpayer's spouse, and any dependent of the taxpayer with respect to
 whom the taxpayer is allowed an exemption under section six hundred
 sixteen of this article for the taxable year;
 (C) The term "qualified  college tuition expenses" shall mean the
 tuition required for the enrollment or attendance of an eligible student
 at an institution of higher education. Provided, however, tuition
 payments made pursuant to the receipt of any scholarships or financial
 aid, or tuition required for enrollment or attendance in a course of
 study leading to the granting of a post baccalaureate or other graduate
 degree, shall be excluded from the definition of "qualified college
 tuition expenses".
 (D) Expenses paid by dependent. If an exemption under section six
 hundred sixteen of this article with respect to an individual is allowed
 to another taxpayer for a taxable year beginning in the calendar year in
 which such individual's taxable year begins,
 (i) no credit under this subsection or deduction under paragraph four
 of subsection (d) of section six hundred fifteen of this article shall
 be allowed to such individual for such individual's taxable year, and
 (ii) for purposes of such credit or deduction, qualified college
 tuition expenses paid by such individual during such individual's
 taxable year shall be treated as paid by such other taxpayer.
 (3) Institution of higher education. For the purposes of this credit
 and the itemized deduction provided by paragraph four of subdivision (d)
 of section six hundred fifteen of this article, the term "institution of
 higher education" shall mean any institution of higher education or
 business, trade, technical or other occupational school, recognized and
 approved by the regents, or any successor organization, of the
 university of the state of New York or accredited by a nationally
 recognized accrediting agency or association accepted as such by the
 regents, or any successor organization, of the university of the state
 of New York, which provides a course of study leading to the granting of
 a post-secondary degree, certificate or diploma.
 (4) Amount of credit. If allowable college tuition expenses are less
 than five thousand dollars, the amount of the credit provided under this
 subsection shall be equal to the applicable percentage of the lesser of
 allowable college tuition expenses or two hundred dollars. If allowable
 college tuition expenses are five thousand dollars or more, the amount
 of the credit provided under this subsection shall be equal to the
 applicable percentage of the allowable college tuition expenses
 multiplied by four percent. Such applicable percentage shall be
 twenty-five percent for taxable years beginning in two thousand one,
 fifty percent for taxable years beginning in two thousand two,
 seventy-five percent for taxable years beginning in two thousand three
 and one hundred percent for taxable years beginning after two thousand
 three.
 (5) Refundability. The credit under this subsection shall be allowed
 against the taxes imposed by this article for the taxable year reduced
 by the credits permitted by this article. If the credit exceeds the tax
 as so reduced, the taxpayer may receive, and the comptroller, subject to
 a certificate of the commissioner, shall pay as an overpayment, without
 interest, the amount of such excess.
 (6) Limitation. No credit shall be allowed under this subsection to a
 taxpayer who claims the itemized deduction provided under paragraph four
 of subdivision (d) of section six hundred fifteen of this article.
 * (t-1) IMB credit for energy taxes. (1) Allowance of credit. A
 taxpayer which is a sole proprietor of an industrial or manufacturing
 business (IMB), or a member of a partnership which is an IMB, shall be
 allowed a credit for energy taxes, to be computed as provided in section
 fourteen-a of this chapter, against the tax imposed by this article.
 (2) Application of credit. If the amount of the credit allowed under
 this subsection for any taxable year shall exceed the taxpayer's tax for
 such year, the excess shall be treated as an overpayment of tax to be
 credited or refunded in accordance with the provisions of section six
 hundred eighty-six of this article, provided, however, that no interest
 shall be paid thereon.
 * NB Expired for taxable years ending on and after January 1, 2007
 (x) Low-income housing credit. (1) Allowance of credit. A taxpayer
 shall be allowed a credit against the tax imposed by this article with
 respect to the ownership of eligible low-income buildings, computed as
 provided in section eighteen of this chapter.
 (2) Application of credit. If the amount of credit allowable under
 this subsection for any taxable year shall exceed the taxpayer's tax for
 such year, the excess may be carried over to the following year or
 years, and may be deducted from the taxpayer's tax for such year or
 years.
 (3) Credit recapture. For provisions requiring recapture of credit,
 see subdivision (b) of section eighteen of this chapter.
 (y) Green building credit. (1) Allowance of credit. A taxpayer shall
 be allowed a credit, to be computed as provided in section nineteen of
 this chapter, against the tax imposed by this article.
 (2) Carryovers. If the amount of the credit and carryovers of such
 credit allowed under this subsection for any taxable year shall exceed
 the taxpayer's tax for such year, the excess, as well as any part of the
 credit or carryovers of such credit, or both, may be carried over to the
 following year or years and may be deducted from the taxpayer's tax for
 such year or years.
 (z) Credit for transportation improvement contributions. (1) Allowance
 of credit. A taxpayer shall be allowed a credit, to be computed as
 provided in section twenty of this chapter, against the tax imposed by
 this article.
 (2) Application of credit. If the amount of the credit allowed under
 this subsection for any taxable year shall exceed the taxpayer's tax for
 such year, the excess shall be treated as an overpayment of tax to be
 credited or refunded in accordance with the provisions of section six
 hundred eighty-six of this article, provided, however, that no interest
 shall be paid thereon.
 (3) Credit recapture. For provisions requiring recapture of credit,
 see subdivision (c) of section twenty of this chapter.
 (aa) Long-term care insurance credit. (1) Residents. A taxpayer shall
 be allowed a credit against the tax imposed by this article equal to
 twenty percent of the premium paid during the taxable year for long-term
 care insurance. In order to qualify for such credit, the taxpayer's
 premium payment must be for the purchase of or for continuing coverage
 under a long-term care insurance policy that qualifies for such credit
 pursuant to section one thousand one hundred seventeen of the insurance
 law. If the amount of the credit allowable under this subsection for any
 taxable year shall exceed the taxpayer's tax for such year, the excess
 may be carried over to the following year or years and may be deducted
 from the taxpayer's tax for such year or years.
 (2) Nonresidents and part-year residents. In the case of a nonresident
 taxpayer or a part-year resident taxpayer, the credit determined under
 this subsection shall be limited to the amount determined by multiplying
 the amount of such credit by the New York source fraction as set forth
 in paragraph three of subsection (e) of section six hundred one of this
 article. The credit as so limited shall be applied as provided in
 paragraph one of this subsection.
 (bb) QEZE credit for real property taxes. (1) Allowance of credit. A
 taxpayer which is a sole proprietor of a qualified empire zone
 enterprise (QEZE), or a member of a partnership which is a QEZE, shall
 be allowed a credit for eligible real property taxes, to be computed as
 provided in section fifteen of this chapter, against the tax imposed by
 this article.
 (2) Application of credit. If the amount of the credit allowed under
 this subsection for any taxable year shall exceed the taxpayer's tax for
 such year, the excess shall be treated as an overpayment of tax to be
 credited or refunded in accordance with the provisions of section six
 hundred eighty-six of this article, provided, however, that no interest
 shall be paid thereon.
 (cc) QEZE tax reduction credit. Allowance of credit. A taxpayer which
 is a sole proprietor of a qualified empire zone enterprise (QEZE), or a
 member of a partnership which is a QEZE, shall be allowed a QEZE tax
 reduction credit against the tax imposed by subsections (a) through (e)
 of section six hundred one of this part.
 (dd) Brownfield redevelopment tax credit. (1) Allowance of credit. A
 taxpayer shall be allowed a credit, to be computed as provided in
 section twenty-one of this chapter, against the tax imposed by this
 article.
 (2) Application of credit. If the amount of the credit allowed under
 this subsection for any taxable year shall exceed the taxpayer's tax for
 such year, the excess shall be treated as an overpayment of tax to be
 credited or refunded in accordance with the provisions of section six
 hundred eighty-six of this article, provided, however, that no interest
 shall be paid thereon.
 (ee) Remediated brownfield credit for real property taxes for
 qualified sites. (1) Allowance of credit. A taxpayer which is a
 developer of a qualified site shall be allowed a credit for eligible
 real property taxes, to be computed as provided in subdivision (b) of
 section twenty-two of this chapter, against the tax imposed by this
 article. For purposes of this subsection, the terms "qualified site" and
 "developer" shall have the same meaning as set forth in paragraphs two
 and three, respectively, of subdivision (a) of section twenty-two of
 this chapter.
 (2) Application of credit. If the amount of the credit allowed under
 this subsection for any taxable year shall exceed the taxpayer's tax for
 such year, the excess shall be treated as an overpayment of tax to be
 credited or refunded in accordance with the provisions of section six
 hundred eighty-six of this article, provided, however, that no interest
 shall be paid thereon.
 (ff) Environmental remediation insurance credit. (1) Allowance of
 credit. A taxpayer shall be allowed a credit, to be computed as provided
 in section twenty-three of this chapter, against the tax imposed by this
 article.
 (2) Application of credit. If the amount of the credit allowed under
 this subsection for any taxable year shall exceed the taxpayer's tax for
 such year, the excess shall be treated as an overpayment of tax to be
 credited or refunded in accordance with the provisions of section six
 hundred eighty-six of this article, provided, however, that no interest
 shall be paid thereon.
 * (gg) Empire state film production credit. (1) Allowance of credit. A
 taxpayer who is eligible pursuant to section twenty-four of this chapter
 shall be allowed a credit to be computed as provided in such section
 twenty-four against the tax imposed by this article.
 (2) Application of credit. If the amount of the credit allowable under
 this subsection for any taxable year exceeds the taxpayer's tax for such
 year, the excess shall be treated as an overpayment of tax to be
 credited or refunded as provided in section six hundred eighty-six of
 this article, provided, however, that no interest shall be paid thereon.
 * NB Repealed January 1, 2014
 (hh)  Nursing home assessment credit. (1) Allowance of credit. A
 taxpayer shall be allowed a credit against the tax imposed by this
 article equal to the amount that directly relates to the assessment
 imposed on a residential health care facility pursuant to paragraph (b)
 of subdivision two of section twenty-eight hundred seven-d of the public
 health law which is separately stated and accounted for on the billing
 statement of a resident of a residential health care facility and  is
 paid directly by the individual taxpayer.
 (2) Application of credit. If the amount of the credit allowed under
 this subsection for any taxable year shall exceed the taxpayer's tax for
 such year, the excess shall be treated as an overpayment of tax to be
 credited or refunded in accordance with the provisions of section six
 hundred eighty-six of this article, provided, however, that no interest
 shall be paid thereon.
 (ii) Security training tax credit. (1) Allowance of credit. A taxpayer
 shall be allowed a credit, to be computed as provided in section
 twenty-six of this chapter, against the tax imposed by this article.
 (2) Application of credit. If the amount of the credit allowed under
 this subsection for any taxable year shall exceed the taxpayer's tax for
 such year, the excess shall be treated as an overpayment of tax to be
 credited or refunded in accordance with the provisions of section six
 hundred eighty-six of this article, provided, however, that no interest
 shall be paid thereon.
 * (jj) Empire state commercial production credit. (1) Allowance of
 credit. A taxpayer that is eligible pursuant to the provisions of
 section twenty-eight of this chapter shall be allowed a credit to be
 computed as provided in such section against the tax imposed by this
 article.
 (2) Application of credit. If the amount of the credit allowable under
 this subsection for any taxable year exceeds the taxpayer's tax for such
 year, fifty percent of the excess shall be treated as an overpayment of
 tax to be credited or refunded as provided in section six hundred
 eighty-six of this article, provided, however, that no interests shall
 be paid thereon. The balance of such credit not credited or refunded in
 such taxable year may be carried over to the immediately succeeding
 taxable year and may be deducted from the taxpayer's tax for such year.
 The excess, if any, of the amount of the credit over the tax for such
 succeeding year shall be treated as an overpayment of tax to be credited
 or refunded as provided in section six hundred eighty-six of this
 article, provided, however, that no interest shall be paid thereon.
  * NB Repealed December 31, 2011
 * NB There are 2 sb (jj)'s
 * (jj) Biofuel production credit. A taxpayer shall be allowed a credit
 to be computed as provided in section twenty-eight of this chapter,
 against the tax imposed by this article. If the amount of the credit
 allowed under this subsection for any taxable year shall exceed the
 taxpayer's tax for such year, the excess shall be treated as an
 overpayment of tax to be credited or refunded in accordance with the
 provisions of section six hundred eighty-six of this article, provided,
 however, that no interest shall be paid thereon.
 * NB There are 2 sb (jj)'s
 (kk) Conservation easement tax credit. (1) Credit allowed. In the case
 of a taxpayer who owns land that is subject to a conservation easement
 held by a public or private conservation agency, there shall be allowed
 a credit for twenty-five percent of the allowable school district,
 county and town real property taxes on such land. In no event shall the
 credit allowed under this subsection in combination with any other
 credit for such school district, county and town real property taxes
 under this section exceed such taxes.
 (2) Conservation easement. For purposes of this subsection, the term
 "conservation easement" means a perpetual and permanent conservation
 easement as defined in article forty-nine of the environmental
 conservation law that serves to protect open space, scenic, natural
 resources, biodiversity, agricultural, watershed and/or historic
 preservation resources. Any conservation easement for which a tax credit
 is claimed under this subsection shall be filed with the department of
 environmental conservation, as provided for in article forty-nine of the
 environmental conservation law and such conservation easement shall
 comply with the provisions of title three of such article, and the
 provisions of subdivision (h) of section 170 of the internal revenue
 code. Dedications of land for open space through the execution of
 conservation easements for the purpose of fulfilling density
 requirements to obtain subdivision or building permits shall not be
 considered a conservation easement under this subsection.
 (3) Land. For purposes of this subsection, the term "land" means a fee
 simple title to real property located in this state, with or without
 improvements thereon; rights of way; water and riparian rights;
 easements; privileges and all other rights or interests of any land or
 description in, relating to or connected with real property, excluding
 buildings, structures, or improvements.
  (4) Public or private conservation agency. For purposes of this
 subsection, the term "public or private conservation agency" means any
 state, local, or federal governmental body; or any private
 not-for-profit charitable corporation or trust which is authorized to do
 business in the state of New York, is organized and operated to protect
 land for natural resources, conservation or historic preservation
 purposes, is exempt from federal income taxation under section 501(c)(3)
 of the internal revenue code, and has the power to acquire, hold and
 maintain land and/or interests in land for such purposes.
 (5) Credit limitation. The amount of the credit that may be claimed by
 a  taxpayer pursuant to this subsection shall not exceed five thousand
 dollars in any given year.
 (6) Application of the credit. If the amount of the credit under this
 subsection for any taxable year shall exceed the taxpayer's tax for such
 year, the excess shall be treated as an overpayment of tax to be
 credited or refunded in accordance with the provisions of section six
 hundred eighty-six of this article, provided, however, that no interest
 shall be paid therein.
 (ll) Home heating system credit. (1) Allowance of credit for
 replacement. A taxpayer shall be allowed a credit against the tax
 imposed by this article for costs incurred on or after July first, two
 thousand six and before July first, two thousand seven by a taxpayer
 which are directly associated with the replacement of an existing home
 heating system, in his or her principal residence, if such residence is
 located in this state, provided such home heating system after such
 replacement qualifies for, and is labeled with, an Energy Star label by
 the manufacturer, pursuant to an agreement among the manufacturer, the
 United States environmental protection agency and the United States
 department of energy. The amount of the credit shall be equal to fifty
 percent of the cost of such replacement but such credit shall not exceed
 five hundred dollars.
 (2) Multiple taxpayers. If the principal residence is shared by two or
 more taxpayers, the amount of the credit allowable under this subsection
 for each such eligible taxpayer shall be prorated according to the
 percentage of the total expenditure for such replacement incurred by
 each taxpayer.
 (3) Application of credit. If the amount of the credit allowed under
 this subsection for any taxable year shall exceed the taxpayer's tax for
 such year, the excess shall be treated as an overpayment of tax to be
 credited or refunded in accordance with the provisions of section six
 hundred eighty-six of this article, provided, however, that no interest
 shall be paid thereon.
 (mm) Clean heating fuel credit. (1) A taxpayer shall be allowed a
 credit against the tax imposed by this article. Such credit, to be
 computed as hereinafter provided, shall be allowed for bioheat, used for
 space heating or hot water production for residential purposes within
 this state and purchased on or after July first, two thousand six and
 before July first, two thousand seven and on or after January first, two
 thousand eight and before January first, two thousand twelve. Such
 credit shall be $0.01 per percent of biodiesel per gallon of bioheat,
 not to exceed twenty cents per gallon, purchased by such taxpayer.
 (2) For purposes of this subsection, the following definitions shall
 apply:
 (a) "Biodiesel" shall mean a fuel comprised exclusively of mono-alkyl
 esters of long chain fatty acids derived from vegetable oils or animal
 fats, designated B100, which meets the specifications of American
 Society of Testing and Materials designation D 6751.
 (b) "Bioheat" shall mean a fuel comprised of biodiesel blended with
 conventional home heating oil, which meets the specifications of the
 American Society of Testing and Materials designation D 396 or D 975.
 (3) If the amount of the credit allowed under this subsection for any
 taxable year shall exceed the taxpayer's tax for such year, the excess
 shall be treated as an overpayment of tax to be credited or refunded in
 accordance with the provisions of section six hundred eighty-six of this
 article, provided, however, that no interest shall be paid thereon.
 (nn) Qualified emerging technology company facilities, operations and
 training credit. (1) A taxpayer that is a qualified emerging technology
 company pursuant to the provisions of section thirty-one hundred two-e
 (and specifically for the activities referenced in paragraph (b) of
 subdivision one of such section thirty-one hundred two-e) of the public
 authorities law, and that meets the eligibility requirements in
 paragraph two of this subsection, shall be allowed a credit against the
 tax imposed by this article. The amount of credit shall be equal to the
 sum (or pro rata share of the sum in the case of a partnership) of the
 amounts specified in paragraphs three, four, and five of this
 subsection, subject to the limitations in paragraph six of this
 subsection.
 (2) An eligible taxpayer shall (i) have no more than one hundred
 full-time employees, of which at least seventy-five percent are employed
 in New York state,
 (ii) have a ratio of research and development funds to net sales, as
 referred to in section thirty-one hundred two-e of the public
 authorities law, which equals or exceeds six percent during its taxable
 year, and
 (iii) have gross revenues, along with the gross revenues of its
 affiliates and related members, not exceeding twenty million dollars for
 the taxable year immediately preceding the year the taxpayer is allowed
 a credit under this subsection. For purposes of this paragraph, the term
 "related member" shall have the same meaning as set forth in clauses (A)
 and (B) of subparagraph one of paragraph (o) of subdivision 9 of section
 two hundred eight of this chapter, and the term "affiliates" shall mean
 those corporations that are members of the same affiliated group (as
 defined in section fifteen hundred four of the internal revenue code) as
 the taxpayer.
 (3) An eligible taxpayer shall be allowed a credit for eighteen per
 centum of the cost or other basis for federal income tax purposes of
 research and development property as defined in subparagraph (B) of
 paragraph two of subsection (a) of this section that is acquired by the
 taxpayer by purchase as defined in section 179(d) of the internal
 revenue code and is placed in service during the taxable year. Provided,
 however, for the purposes of this paragraph only, an eligible taxpayer
 shall be allowed a credit for such percentage of the (i) cost or other
 basis for federal income purposes for property used in the testing or
 inspection of materials and products,
 (ii) the costs or expenses associated with quality control of the
 research and development,
 (iii) fees for use of sophisticated technology facilities and
 processes, and
 (iv) fees for production or eventual commercial distribution of
 materials and products resulting from the activities of an eligible
 taxpayer as long as such activities fall under the activities listed in
 paragraph (b) of subdivision one of section thirty-one hundred two-e of
 the public authorities law. The costs, expenses and other amounts for
 which a credit is allowed and claimed under this paragraph shall not be
 used in the calculation of any other credit allowed under this article.
 (4) An eligible taxpayer shall be allowed a credit for nine percentum
 of "qualified research expenses", paid or incurred by the taxpayer in
 the taxable year. "Qualified research expenses" shall mean expenses
 associated with in-house research, use of sophisticated technology
 facilities and processes, and costs associated with the dissemination of
 the results of the products that directly result from such research and
 development activities; provided, however, that  such costs shall not
 include advertising or promotion through media. In addition, costs
 associated with the preparation of patent applications, patent
 application filing fees, patent research fees, patent examinations fees,
 patent post allowance fees, patent maintenance fees, and grant
 application expenses and fees shall be eligible for such credit. In no
 case shall the credit allowed by this paragraph apply to expenses for
 litigation or the challenge of another entity's intellectual property
 rights, or for contract expenses involving outside paid consultants.
 (5) An eligible taxpayer shall be allowed a credit for qualified
 high-technology training expenditures as described in this paragraph
 paid or incurred by the taxpayer.
 (a) The amount of credit shall be one hundred percent of the training
 expenses described in subparagraph (c) of this paragraph, subject to a
 limitation of no more than four thousand dollars per employee per year
 for such training expenses.
 (b) Qualified high-technology training shall include a course or
 courses taken and satisfactorily completed by an employee of the
 taxpayer at an accredited, degree granting post-secondary college or
 university in New York state that
 (i) directly relates to the activities referred to in paragraph (b) of
 subdivision one of section thirty-one hundred two-e of the public
 authorities law, and
 (ii) is intended to upgrade, retrain or improve the productivity or
 theoretical awareness of the employee. Such course or courses may
 include, but are not limited to, instruction or research relating to
 techniques, meta, macro, or micro-theoretical or practical knowledge
 bases or frontiers, or ethical concerns related to such activities. Such
 course or courses shall not include classes in the disciplines of
 management, accounting or the law or any class designed to fulfill the
 discipline specific requirements of a degree program at the associate,
 baccalaureate, graduate or professional level of these disciplines.
 Satisfactory completion of a course or courses shall mean the earning
 and granting of credit or equivalent unit, with the attainment of a
 grade of "B" or higher in a graduate level course or courses, a grade of
 "C" or higher in an undergraduate level course or courses, or a similar
 measure of competency for a course that is not measured according to a
 standard grade formula.
 (c) Qualified high-technology training expenditures shall include
 expenses for tuition and mandatory fees, and software required by the
 institution, fees for textbooks or other literature required by the
 institution offering the course or courses, minus applicable
 scholarships and tuition or fee waivers not granted by the taxpayer or
 any affiliate of the taxpayer, paid or reimbursed by the taxpayer.
 Qualified high technology expenditures do not include room and board,
 computer hardware or software not specifically assigned for such course
 or courses, late-charges, fines or membership dues and similar expenses.
 Such qualified expenditures shall not be eligible for the credit allowed
 by this subsection unless the employee for whom the expenditures are
 disbursed is continuously employed by the taxpayer in a full-time,
 full-year position primarily located at a qualified site during the
 period of such coursework and lasting through at least one hundred and
 eighty days after the satisfactory completion of the qualifying
 course-work. Qualified high-technology training expenditures shall not
 include expenses for in house or shared training outside of a New York
 state higher education institution or the use of consultants outside of
 credit granting courses whether such consultants function inside of such
 higher education institution or not.
 (d) If a taxpayer relocates from an academic business incubator
 facility partnered with an accredited post-secondary education
 institution located within New York state, which provides space and
 business support services to taxpayers, to another site, the credit
 provided in this subsection shall be allowed for all expenditures
 referenced in subparagraph (c) of this paragraph paid or incurred in the
 two preceding taxable years that the taxpayer was located in such an
 incubator facility for employees of the taxpayer who also relocate from
 said incubator facility to such New York site and are employed and
 primarily located by the taxpayer in New York. Such expenditures in the
 two preceding years shall be added to the amounts otherwise qualifying
 for the credit provided by this subsection that were paid or incurred in
 the taxable year that the taxpayer relocated from such a facility. Such
 expenditures shall include expenses paid or incurred for an eligible
 employee who is a full-time, full-year employee of said taxpayer during
 the taxable year that the taxpayer relocated from an incubator facility
 notwithstanding (i) that such employee was employed full or part-time as
 an officer, staff-person or paid intern of the taxpayer when such
 taxpayer was located at such incubator facility or (ii) that such
 employee was not continuously employed when such taxpayer was located at
 the incubator facility during the one hundred eighty day period
 referenced in subparagraph (c) of this paragraph, provided such employee
 received wages or equivalent income for at least seven hundred fifty
 hours during any twenty-four month period when the taxpayer was located
 at the incubator facility. Such expenditures shall include payments made
 to such an employee after the taxpayer has relocated from the incubator
 facility for qualified expenditures if such payments are made to
 reimburse such an employee for qualified expenditures paid by the
 employee during such two preceding years. The credit provided under this
 subparagraph shall be allowed, in any year that said taxpayer qualifies
 as an eligible taxpayer.
 (e) For purposes of this subsection the term "academic year" shall
 mean the annual period of sessions of a post-secondary college or
 university.
 (f) For the purposes of this subsection the term "academic incubator
 facility" shall mean a facility providing low-cost space, technical
 assistance, support services and educational opportunities, including
 but not limited to central services provided by the manager of the
 facility to the tenants of the facility, to an entity located in New
 York state. Such entity's primary activity must be an activity described
 in paragraph (b) of subdivision one of section thirty-one hundred two-e
 of the public authorities law, and such entity must be in the formative
 stage of development. The academic incubator facility and the entity
 must act in partnership with an accredited post-secondary college or
 university located in New York state. An academic incubator facility's
 mission shall be to promote job creation, entrepreneurship, technology
 transfer, and provide support services to incubator tenants, including,
 but not limited to, business planning, management assistance,
 financial-packaging, linkages to financing services, and coordinating
 with other sources of assistance.
 (6) An eligible taxpayer may claim credits under this subsection for
 four consecutive taxable years, except, if a taxpayer is located in an
 academic incubator facility and relocates within New York state to a
 nonacademic incubator site, then the taxpayer (i) may make a revocable
 election to defer the credit provided under this subsection to the first
 taxable year beginning after the taxpayer relocates from an academic
 incubator facility, and (ii) shall be eligible for such credit for five
 consecutive years. In no case shall the credit allowed by this
 subsection to a taxpayer exceed two hundred fifty thousand dollars per
 year.
 (7) If the amount of credit allowed under this subsection for any
 taxable year shall exceed the taxpayer's tax for such year, the excess
 shall be treated as an overpayment of tax to be credited or refunded in
 accordance with the provisions of section six hundred eighty-six of this
 article, provided, however, that no interest shall be paid thereon.
 (8) The credit allowed under this subsection shall not be applicable
 for taxable years beginning on or after January first, two thousand
 twelve.
 * (oo) Credit for rehabilitation of historic properties. (1) For
 taxable years beginning on or after January first, two thousand ten, any
 person, firm, partnership, limited liability company, corporation or
 other business entity shall be allowed a credit as hereinafter provided,
 against the tax imposed by this article, in an amount equal to one
 hundred percent of the amount of credit allowed the taxpayer for the
 same taxable year with respect to a certified historic structure under
 subsection (c) (2) of section 47 of the federal internal revenue code
 with respect to a certified historic structure located within the state.
 Provided, however, the credit shall not exceed five million dollars.
 (2) Tax credits allowed pursuant to this subsection shall be allowed
 in the taxable year that the qualified rehabilitation is placed in
 service under section 167 of the federal internal revenue code.
 (3) If the credit allowed the taxpayer pursuant to section 47 of the
 internal revenue code with respect to a qualified rehabilitation is
 recaptured pursuant to subsection (a) of section 50 of the internal
 revenue code, a portion of the credit allowed under this subsection must
 be added back in the same taxable year and in the same proportion as the
 federal recapture.
 (4) If the amount of the credit allowable under this subsection for
 any taxable year shall exceed the taxpayer's tax for such year, the
 excess may be carried over to the following year or years, and may be
 applied against the taxpayer's tax for such year or years.
 (5) To be eligible for the credit allowable under this subsection the
 rehabilitation project shall be in whole or in part a targeted area
 residence within the meaning of section 143(j) of the internal revenue
 code or located within a census tract which is identified as being at or
 below one hundred percent of the state median family income in the most
 recent federal census.
 * NB Effective until December 31, 2014
 * (oo) Credit for rehabilitation of historic properties. (1) For
 taxable years beginning on or after January first, two thousand seven, a
 taxpayer shall be allowed a credit as hereinafter provided, against the
 tax imposed by this article, in an amount equal to thirty percent of the
 amount of credit allowed the taxpayer for the same taxable year with
 respect to a certified historic structure under subsection (c)(3) of
 section 47 of the federal internal revenue code with respect to a
 certified historic structure located within the state. Provided,
 however, the credit shall not exceed one hundred thousand dollars.
 (2) If the credit allowed the taxpayer pursuant to subsection (c)(3)
 of section 47 of the internal revenue code is recaptured pursuant to
 subsection (a) of section 50 of the internal revenue code, a portion of
 the credit allowed under this subsection must be added back in the same
 taxable year as such recapture equal to thirty percent times the amount
 of the federal recapture.
 (3) If the amount of the credit allowable under this subsection for
 any taxable year shall exceed the taxpayer's tax for such year, the
 excess may be carried over to the following year or years, and may be
 deducted from the taxpayer's tax for such year or years.
 * NB Effective December 31, 2014
 * NB There are 2 sb§(oo)'s
 * (oo) Credit for companies who provide transportation to individuals
 with disabilities. (a) Allowance and amount of credit. A taxpayer, who
 provides a taxicab service as defined in section one hundred
 forty-eight-a of the vehicle and traffic law, or a livery service as
 defined in section one hundred twenty-one-e of the vehicle and traffic
 law, shall be allowed a credit, to be computed as provided in this
 subsection, against the tax imposed by this article. The amount of the
 credit shall be equal to the incremental cost associated with upgrading
 a vehicle so that it is accessible by individuals with disabilities as
 defined in paragraph (b) of this subsection. Provided, however, that
 such credit shall not exceed $10,000 per vehicle.
 (b) Definition. The term "accessible by individuals with disabilities"
 shall, for the purposes of this subsection, refer to a vehicle that
 complies with federal regulations promulgated pursuant to the Americans
 with Disabilities Act applicable to vans under 22 feet in length, by the
 federal Department of Transportation, in Code of Federal Regulations,
 title 49, parts 37 and 38, and by the federal Architecture and
 Transportation Barriers Compliance Board, In Code of Federal
 Regulations, title 36, sections 1192.23, and the Federal Motor Vehicle
 Safety Standards, Code of Federal Regulations, title 49, part 57.
 (c) Application of credit. If the amount of the credit shall exceed
 the taxpayer's tax for such year the excess shall be carried over to the
 following year or years, and may be deducted from the taxpayer's tax for
 such year or years.
 * NB Repealed December 31, 2010
 * NB There are 2 sb§(oo)'s
 (pp) Historic homeownership rehabilitation credit. (1) For taxable
 years beginning on or after January first, two thousand seven, a
 taxpayer shall be allowed a credit, to be computed as hereinafter
 provided, against the tax imposed by this article. The amount of the
 credit shall be equal to twenty percent of the qualified rehabilitation
 expenditures made by the taxpayer with respect to a qualified historic
 home and may be allowed in the taxable year in which the final
 certification step of the certified rehabilitation is completed.
 (A) If such expenditures relate only to exterior work, the credit
 shall be allowed for qualified rehabilitation expenditures if the
 exterior work has been approved by a local landmark commission
 established pursuant to section ninety-six-a or one hundred nineteen-dd
 of the general municipal law or by the office of parks, recreation and
 historic preservation.
 (B) If such expenditures relate to both exterior and interior work,
 the credit shall be allowed for qualified rehabilitation expenditures
 that have been approved by the office of parks, recreation and historic
 preservation or by a local government certified pursuant to section
 101(c)(1) of the national historic preservation act. Under this
 subparagraph, approval is necessary for the qualified rehabilitation
 expenditures related to both the exterior work on the qualified historic
 home and interior work affecting primary significant historic spaces of
 the qualified historic home.
 (2) * (A) With respect to any particular residence of a taxpayer, the
 credit allowed under paragraph one of this subsection shall not exceed
 fifty thousand dollars. In the case of a husband and wife, the amount of
 the credit shall be divided between them equally or in such other manner
  as they may both elect. If a taxpayer incurs qualified rehabilitation
 expenditures in relation to more than one residence in the same year,
 the total amount of credit allowed under paragraph one of this
 subsection for all such expenditures shall not exceed twenty-five
 thousand dollars.
 * NB Effective until December 31, 2014
 * (A) With respect to any particular residence of a taxpayer, the
 credit allowed under paragraph one of this subsection shall not exceed
 twenty-five thousand dollars. In the case of a husband and wife, the
 amount of the credit shall be divided between them equally or in such
 other manner as they may both elect. If a taxpayer incurs qualified
 rehabilitation expenditures in relation to more than one residence in
 the same year, the total amount of credit allowed under paragraph one of
 this subsection for all such expenditures shall not exceed twenty-five
 thousand dollars.
 * NB Effective December 31, 2014
 * (B) If the amount of credit allowable under this subsection shall
 exceed the taxpayer's tax for such year, and the taxpayer's New York
 adjusted gross income for such year does not exceed sixty thousand
 dollars, the excess shall be treated as an overpayment of tax to be
 credited or refunded in accordance with the provisions of section six
 hundred eighty-six of this article, provided, however, that no interest
 shall be paid thereon. If the taxpayer's New York adjusted gross  income
 for such year exceeds sixty thousand dollars, the excess credit that may
 be carried over to the following year or years and may be deducted from
 the taxpayer's tax for such year or years.
 * NB Effective until December 31, 2014
 * (B) If the amount of credit allowable under this subsection shall
 exceed the taxpayer's tax for such year, the excess may be carried over
 to the following year or years and may be deducted from the taxpayer's
 tax for such year or years.
 * NB Effective December 31, 2014
 (3)(A) The term "qualified rehabilitation expenditure" means, for
 purposes of this subsection, any amount properly chargeable to a capital
 account:
 (i) in connection with the certified rehabilitation of a qualified
 historic home, and
 (ii) for property for which depreciation would be allowable under
 section 168 of the internal revenue code if the qualified historic home
 were used in a trade or business.
 (B) Such term shall not include (i) the cost of acquiring any building
 or interest therein, (ii) any expenditure attributable to the
 enlargement of an existing building, or (iii) any expenditure made prior
 to January first, two thousand seven.
 (C) Such term shall not include any expenditure in connection with the
 rehabilitation of a qualified historic home unless at least five percent
 of the total expenditures made in the rehabilitation process are
 allocable to the rehabilitation of the exterior of such building.
 (D) If only a portion of a building is used as a residence of the
 taxpayer, only qualified rehabilitation expenditures which are properly
 allocable to such residential portion shall be taken into account under
 this subsection.
  (4)(A) The term "certified rehabilitation" means, for purposes of this
 subsection, any rehabilitation of a certified historic structure which
 has been approved and certified as being consistent with the standards
 established by the commissioner of parks, recreation and historic
 preservation for rehabilitation by the office of parks, recreation and
 historic preservation, a local government certified pursuant to section
 101(c)(1) of the national historic preservation act or a local landmark
 commission established pursuant to section ninety-six-a or one hundred
 nineteen-dd of the general municipal law.
 (B) A certified rehabilitation shall require:
 (i) an initial certification that the structure meets the definition
 of the term "certified historic structure";
 (ii) a second certification, to be issued prior to construction,
 certifying that the proposed rehabilitation work is consistent with
 standards established by the commissioner of parks, recreation and
 historic preservation for rehabilitation; and
 (iii) a final certification issued when construction is completed,
 certifying that the work was completed as proposed and that the  costs
 are consistent with the work completed. Such final certification shall
 be acceptable as proof that the expenditures related to such
 construction qualify as qualified rehabilitation expenditures for
 purposes of the credit allowed under either subparagraph (A) or (B) of
 paragraph one of this subsection.
 (5)(A) The term "qualified historic home" means, for purposes of this
 subsection, a certified historic structure located within New York
 state:
 (i) which has been substantially rehabilitated,
 (ii) which, or any portion of which, is owned, in whole or part, by
 the taxpayer,
 (iii) in which the taxpayer resides during the taxable year in which
 the taxpayer is allowed a credit under this subsection, and
 * (iv) which is in whole or in part a targeted area residence within
 the meaning of section 143(j) of the internal revenue code or is located
 within a census tract which is identified as being at or below one
 hundred percent of the state median family income in the most recent
 federal census.
 * NB Effective until December 31, 2014
 * (iv) which is in whole or in part a targeted area residence within
 the meaning of section 143(j) of the internal revenue code and located
 within an area of a city, town or village whose governing body has
 identified by resolution that such area is in need of community renewal
 because of deteriorated and/or vacant buildings and, by local law, has
 adopted a historic preservation and community renewal program to
 preserve and/or revitalize such area. A historic preservation and
 community renewal program is a program that coordinates all applicable
 governmental benefits and programs with the aims of preserving and/or
 revitalizing neighborhoods, encouraging property owners to complete
 substantial rehabilitation projects and promoting smart growth economic
 development. Such local laws shall be filed with the office of parks,
 recreation and historic preservation. The office of parks, recreation
 and historic preservation shall assist local governments in developing
 historic preservation and community renewal programs.
 * NB Effective December 31, 2014
 (B) A building shall be treated as having been "substantially
 rehabilitated" if the qualified rehabilitation expenditures in relation
 to such building total five thousand dollars or more.
 (6) The term "certified historic structure" means, for purposes of
 this subsection, any building (and its structural components) which:
 (i) is listed in the state or national register of historic places, or
 (ii) is located in a state or national registered historic district
 and is certified as being of historic significance to the district.
 (7) If the taxpayer holds stock as a tenant-shareholder in a
 cooperative housing corporation, such taxpayer shall be treated as
 owning the house or apartment which the taxpayer is entitled to occupy
 as such shareholder.
 (8)(A) A percentage of the total expenditures made in the
 rehabilitation of the exterior of a building containing cooperative or
 condominium dwelling units shall be attributed to each such unit within
 the building based on the percentage of space each such unit occupies
 within the building.
 (B) In the case of a building where less than the entire building is
 used as a residence of the taxpayer, only the portion of the total
 expenditures made in the rehabilitation of the building that is
 attributable to the residence of the taxpayer shall be treated as
 qualified rehabilitation expenditures for the purposes of this
 subsection.
 (C) In the case of a building that is owned by and is a residence of
 two or more persons, other than a husband and wife, the portion of the
 total expenditures made in the rehabilitation of the building that  is
 attributable to each taxpayer shall be equal to the taxpayer's share of
 ownership in such building.
 (9) In the case of a building other than a building to which paragraph
 ten of this subsection applies, qualified rehabilitation expenditures
 shall be treated for purposes of this subsection as made on the date of
 the final certification referred to in clause (iii) of subparagraph (B)
 of paragraph four of this subsection.
 (10)(A) In the case of a purchased qualified historic home, the
 taxpayer shall be treated as having made, on the date of purchase, the
 qualified rehabilitation expenditures made by the seller of such home.
 For purposes of this subsection, expenditures made by the seller shall
 be deemed qualified rehabilitation expenditures if such expenditures, if
 made by the purchaser, would have so qualified.
 (B) The term "purchased qualified historic home" means any qualified
 historic home purchased by the taxpayer if:
 (i) the taxpayer is the first purchaser of such home after the date of
 the final certification referred to in clause (iii) of subparagraph (B)
 of paragraph four of this subsection, and the purchase occurs within
 five years after such date,
 (ii) the taxpayer, during the taxable year in which the taxpayer is
 allowed a credit under this subsection, resides in such home,
 (iii) no credit was allowed to the seller under this subsection with
 respect to such rehabilitation, and
 (iv)  the taxpayer is furnished with such information as the
 commissioner determines is necessary to determine any credit under this
 subsection.
 (11)(A) If, before the end of the two-year period beginning either on
 the date of the final certification referred to in clause (iii) of
 subparagraph (B) of paragraph four of this subsection or, if paragraph
 ten of this subsection applies, on the date of purchase of such building
 by the taxpayer, the taxpayer disposes of such taxpayer's interest in
 such building, or such building ceases to be used as a residence of the
 taxpayer, the taxpayer's tax imposed by this article for the taxable
 year in which such disposition or cessation occurs shall be increased by
 the recapture portion of the credit allowed under this subsection for
 all prior taxable years with respect to such rehabilitation.
 (B) For purposes of subparagraph (A) of this paragraph, the recapture
 portion shall be the product of the amount of credit claimed by the
 taxpayer multiplied by a ratio, the numerator of which is equal to
 twenty-four less the number of months the building is used as the
 taxpayer's residence and the denominator of which is twenty-four.
 (12) Nothing contained in this subsection shall be construed to impose
 a duty upon a local landmark commission established pursuant to section
 ninety-six-a or one hundred nineteen-dd of the general municipal law or
 a local government certified pursuant to section 101(c)(1) of the
 national historic preservation act to undertake any review or approval
 of an application for the certification of the rehabilitation of
 historic structures and of rehabilitation expenditures provided for in
 this subsection.
 (yy) Order of credits. Credits allowable under this article which
 cannot be carried over and which are not refundable shall be deducted
 first. Credits allowable under this article which can be carried over,
 and carryovers of such credits, shall be deducted next, and among such
 credits, those whose carryover is of limited duration shall be deducted
 before those whose carryover is of unlimited duration. Credits allowable
 under this article which are refundable shall be deducted last.
 (zz) Cross references.--For credit in respect of:
 (1) taxes withheld on wages, see section six hundred seventy-three,
 (2) taxes imposed on a resident by other states, see section six
 hundred twenty,
 (3) taxes overpaid for a prior taxable year, see section six hundred
 eighty-six,
 (4) taxes paid by a trust for a prior taxable year on income
 subsequently distributed, see sections six hundred twenty-one and six
 hundred thirty-five.