COVID-19 Capital Costs Tax Credit Program

COVID-19 Capital Costs Tax Credit Program

New York State has announced another program designed to help small businesses that have been, and continue to be, impacted by the COVID-19 Pandemic. The COVID-19 Capital Costs Tax Credit Program has made $250 million available to small businesses that made investments to comply with emergency orders and regulations or to increase public safety in response to COVID-19. There is an online screening tool that business owners can follow to see if they are pre-approved for this tax credit. The actual application form will be sent via email that contains a link once the business is deemed eligible.

In order to be considered “eligible” for this tax credit, businesses must meet the following requirements:

  • Operate a location in New York State
  • Have less than 100 full-time equivalent (FTE) employees
  • $2.5 million or less of gross receipts during the 2021 tax year
  • At least $2,000 of eligible costs between January 1, 2021 and December 31, 2022.
  • Not owe past due state taxes or local property taxes

Eligible COVID-19 related costs include, but are not limited to;

  • Supplies to disinfect or protect against COVID-19 transmission
  • Costs associated with expanding, or defining space to accommodate social distancing
  • Expenses related to increased outdoor activity and outdoor space expansions
  • Machinery and equipment to facilitate contactless sales

The Tax Credit will cover 50% of eligible costs, up to $50,000, for a maximum tax credit award of $25,000. The credits will be awarded on a first come first serve basis until program funds are depleted.

The application form has not yet been finalized, but proof of expenses for anything over $1,000 will be required to submit with the form in order to receive the tax credit. For eligible costs less than $1,000 we advise our clients to keep receipts readily available because a random sample will be selected and proof of expense will be required for those selected items. Support documentation can include the invoice showing the bill was paid, bank statements or credit card statements showing the amount was withdrawn from the account, or cancelled checks.

To find out more information about this Tax Credit, as well as a full list of eligible COVID-19 costs, please use the link below:

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