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Empire Zones

The Empire Zone program (formerly called Economic Development Zones) was established in 1986 to encourage growth and expansion of new and existing business in economically depressed areas. It is a tool to attract businesses, investment, and the creation of new jobs.

In 2000, Governor George Pataki signed legislation that significantly transformed the program to improve the ability of State and local governments to designate and administer existing zones and create additional zones. At inception there were 14 original zones. Currently there are 82 zones through out the State. (85 by the end of 2007).

Empire Zone Benefits are listed below:

A. Wage Tax Credits (WTC):
The Wage Tax Credit is a credit for new or increased Empire Zone created positions/employees.

Credit Amount:
• $1,500 Credit per qualified new full-time or full-time equivalent [35 hours] employee.
• $2,000 Credit per qualified new employee paid over $40,000 in an "investment zone".
• $3,000 for targeted employees.
• $3,500 Credit per qualified new employee paid over $40,000 in an "investment zone".
• Credit is allowed for up to five (5) consecutive years beginning in the first tax year in which all three eligibility requirement are met.

B. Investment Tax Credits (ITC):
• Available to manufacturing and financial service business which purchase production equipment (as defined by the Internal Revenue Service).
• The credit may be claimed each time qualified equipment is purchased.

Credit Amount:
• C-Corps: Credit equals 10% of investment in tangible property for the year.
• S-Corps, Partnerships, & Individuals: Credit equal 8%.

C. Employment Incentive Credit (EIC):
• The Employment Incentive Credit has been available to corporations since 1986.

Credit Amount
• Credit equals 30% of Investment Tax Credit for three years immediately following the year the EZ investment tax credit was allowed.

D. Utility Rate Reductions:
• Businesses that locate or expand their operations in an EZ may receive significantly reduced rates.

Credit Amount:
• Based on increase of usage and is calculated by the utility company.

E. Zone Capital Credits:

Credit Amount:
• 25% of investment/contribution against personal or corporate income taxes.

F. Sales Tax Refunds:

Credit Amount:
• Rebate of the State portion (local where allowed) sales tax for building materials that are incorporated into a qualifying commercial or industrial structure being constructed, expanded or rehabilitated.

G. Real Property Tax Exemption [for Improvements or New Construction]:

• Ten year abatement of local property taxes (Town, County, and School District) based on improvements to property:

Credit Amount:
• 100% abatement first 7 years
• 75% abatement for 8th year
• 50% abatement for 9th year
• 25% abatement for 10th year

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