Investment Credit

• A major deduction available to New York businesses, estates and individuals is the investment tax credit, which encourages investment in new manufacturing, retail, waste treatment, pollution control and research activities in the state. Beginning in 2005, taxpayers were also able to claim investments related to film production with this deduction. The credit is generally allowed for the year the investment is placed in service, though any deduction that is not used in that year may be carried forward for up to 10 years. The credit is claimed on form IT-212 for most taxpayers and form CT-46 for corporations.
  
  

Green Building Tax Deductions

• Builders of qualified green buildings -- structures with environmentally-friendly features and high energy or water use efficiency -- are also eligible for a substantial tax deduction. To qualify for the green building credit, the taxpayer must first file with the Department of Environmental Conservation to certify the green building. The credit is not refundable, but any amounts not used in the tax year that it is applied may be carried forward for up to five tax years. The credit is figured and claimed on state form DTF-630.
  
  

Low-Income Housing Credit

• Builders of green buildings and other investments may qualify for more deductions if the building is used to provide housing units that are affordable for low-income individuals and families. Like the investment credit, the low-income housing credit should be claimed in the year a low-income housing development is placed in service, but any portion of the low-income housing credit not used in the first tax year may be deducted for up to 10 subsequent years. The Division of Housing and Community Renewal administers this deduction, which is figured on state form DTF-625.
  
  

Other State Credits and Deductions

• While the investment credit and green building credit make up large deductions available to many businesses and individual taxpayers, they are not the only deductions offered by the state. According to the "New York Times," the state does not apply an income tax to any Social Security income or pensions from state and local governments, for example. In addition, the state allows deductions for various environmental activities, including the dedication of lands for conservation, development of alternative fuels, biofuels and fuel cells, the restoration of environmentally degraded sites and the rehabilitation of historic properties. Other deductions are offered to incentivize services for people with disabilities, including deductions for taxicab companies that provide accessible transportation and employers who hire individuals with disabilities.