New York Governor Andrew Cuomo is calling for new tax credits to help small businesses significantly impacted by COVID-19…
New York Governor Andrew Cuomo is calling for new tax credits to help small businesses significantly impacted by COVID-19. Gov. Cuomo announced the $130 million tax credit program — the Pandemic Recovery and Restart Program — as part of his FY 2022 Executive Budget.
“As we embark on our post-COVID reconstruction, it’s critical that we not only jump-start our economic recovery, but also ensure we find ways to support highly impacted small businesses that have been among the hardest hit throughout this pandemic,” Governor Cuomo said in a press statement. “The Executive Budget was crafted to do just that. Through the creation and expansion of $130 million in tax credits, we are working to lessen the burden on critical sectors – restaurants, the arts, and so many others – so those funds can be redirected back to the businesses themselves and get them back up and running.”
New York Pandemic Recovery and Restart Program
The new tax credit program targets industries and businesses that have been particularly hard-hit by the pandemic, including hotels, restaurants, and theaters. Below is a brief summary of the proposal:
Small Business Return-To-Work Tax Credit: The program would provide refundable tax credits to support certain small businesses highly impacted by COVID-19 in the hiring of additional workers through 2021. To qualify, small businesses must have experienced a minimum of 40 percent revenue or employment loss. The tax credit is $5,000 per employee and up to $50,000 per business. The amount of total credits available under the program would be capped at $50 million. The Small Business Return-To-Work Tax Credit would be administered by the Department of Economic Development (DED).
Restaurant Return-To-Work Tax Credit: The program would provide $50 million in tax credits to support highly-impacted restaurants hard hit by the pandemic through 2021. Eligibility is expressly limited to small, independently-owned restaurants that are located within New York City that were subject to a ban on indoor dining for over six months; or are located outside of New York City in areas that were designated as a red or orange zone for at least 30 days. Restaurants would receive the credit immediately if they choose. The credit would be $5,000 per employee and up to $50,000 per business. The Restaurant Return-To-Work Tax Credit Program would also be administered by the DED.
New York City Musical and Theatrical Production Tax Credit: The program would provide $25 million in tax credits to qualified musical and theatrical production companies, which are defined as businesses that produce a musical or theater production in New York City and spend at least $1 million dollars in qualified production expenditures. Eligible businesses could receive a refundable tax credit equal to 25 percent of the sum of their production expenditures incurred by December 31, 2021, with a maximum of $500,000 per production company. The New York City Musical and Theatrical Production Tax Credit Program would be administered by DED.
Extend and Enhance the Musical and Theatrical Production Credit for Four Years: The program would extend the sunset date of the musical and theatrical production tax credit for four additional years – to January 1, 2026. The musical and theatrical production credit encourages touring musical and theatrical productions in New York theaters outside the City of New York. Eligible production companies taxable under Tax Law Articles 9-A and 22 can claim a refundable credit equal to 25 percent of qualified production costs and transportation expenditures. Under Gov. Cuomo’s proposal, the annual tax credit cap would increase from $4 million to $8 million effective immediately.
What’s Next?
At this point, the new tax credit programs are only proposals. The New York Legislature must approve legislation establishing the Pandemic Recovery and Restart Program. Gov. Cuomo could then sign the new tax credits into law.
If you have any questions or if you would like to discuss the matter further, please contact me, Michael Sheppeard, or the Scarinci Hollenbeck attorney with whom you work, at 201-896-4100.
Assignment for the Benefit of Creditors: An Alternative to Bankruptcy for Distressed Businesses
When a business reaches the point where it can no longer service its debts or otherwise resolve its liabilities, management is often faced with a difficult question: is a bankruptcy filing necessary or is there another way to perform an orderly liquidation or sale of the business assets? While Chapters 7 and 11 of the […]
Breaking Down New Jersey’s “Mansion” Tax: What Buyers and Sellers Need to Know
For many years, the New Jersey Mansion Tax has been a significant consideration in high-value real estate transactions. Recent legislative changes, however, have substantially altered how the tax operates, including who is responsible for paying it and the amount owed in certain transactions. Whether you are purchasing, selling, or investing in New Jersey real estate, […]
Estate Planning for Digital Assets Under New Jersey Law
As our personal and financial lives increasingly move online, estate planning must evolve to address a new category of property: digital assets. From email accounts and social media profiles to cryptocurrency and cloud-stored business records, these assets often carry both financial and sentimental value. Yet, without proper planning, they can become inaccessible—or even lost—upon incapacity […]
The Role of Representation and Warranty Insurance in M&A Transactions
In today’s mergers and acquisitions market, representation and warranty (R&W) insurance has become a common feature of deal negotiations. Once used primarily in larger transactions, R&W insurance is now frequently incorporated into middle-market deals as buyers and sellers look for efficient ways to allocate risk and close deals. When structured properly, R&W insurance can help […]
You Just Received a Federal Grand Jury Subpoena in New Jersey: Now What?
Receiving a federal grand jury subpoena is not something most businesses or individuals anticipate. While it can be concerning, a federal grand jury subpoena does not necessarily mean that you are being accused of wrongdoing. It does, however, mean that a federal criminal investigation is underway and that federal prosecutors believe you may possess information […]
Why Every Business Should Conduct an Annual Insurance Coverage Review
Most New Jersey business owners purchase insurance policies, file them away, and assume they are protected if a claim arises. Without a regular insurance coverage review, many companies discover gaps only after a lawsuit, cyberattack, property loss, or other significant event occurs. An annual insurance coverage review can help businesses identify potential risks, ensure their […]
No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.
Sign up to get the latest from our attorneys!
Explore What Matters Most to You.
Consider subscribing to our Firm Insights mailing list by clicking the button below so you can keep up to date with the firm`s latest articles covering various legal topics.
Stay informed and inspired with the latest updates, insights, and events from Scarinci Hollenbeck. Our resource library provides valuable content across a range of categories to keep you connected and ahead of the curve.
Let`s get in touch!
Sign up to get the latest from the Scarinci Hollenbeck, LLC attorneys!
