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Summary of 2023 corporation tax and personal income tax changes

Alcoholic beverage production credit (Articles 9-A and 22)

For tax years beginning on or after January 1, 2023, the credit for the first 500,000 gallons of wine and liquor produced in New York State per tax year has increased to:

  • thirty cents per gallon of wine;
  • $2.54 per gallon of liquor containing over 2% but less than 24% alcohol by volume; and
  • $6.44 per gallon of liquor containing over 24% alcohol by volume.

For more information, see Alcoholic beverage production credit.

[Part FF of Chapter 59 of the Laws of 2023; Tax Law §§ 37, 210-B(39), and 606(uu)]

Allow the Tax Department to appeal certain Tax Appeals Tribunal decisions (Article 40)

The Tax Department can now seek judicial review of Tax Appeals Tribunal decisions involving interpretations of:

  • state or federal constitutional law,
  • federal law,
  • laws of other states,
  • international law, or
  • other legal matters that are beyond the reach of the state legislature.

Interest and penalty will not accrue from the date the Tax Department appeals a tribunal decision until 15 days after a final decision is issued.

This applies to decisions and orders issued on or after May 3, 2023.

[Part V of Chapter 59 of the Laws of 2023; Tax Law § 2016]

Brownfield redevelopment tax credit (Articles 9, 9-A, 22, and 33)

Effective April 9, 2022, the following amendments were made to the brownfield redevelopment tax credit.

  • Site preparation costs for a site issued a Certificate of Completion (COC) on or after July 1, 2015, but on or before June 24, 2021, includes all costs paid or incurred within 84 months after the last day of the tax year in which the COC is issued.  This technical amendment clarifies that costs for this period are measured from the issuance date of the COC rather than the issuance date of the notice of acceptance.
  • For sites issued a COC on or after January 1, 2017, and prior to December 31, 2017, located in a city with a population greater than 205,000 and less than 215,000 within a county with a population greater than 1,000,000 but less than 1,010,000 per the latest federal decennial census:
    • site preparation costs includes all costs paid or incurred within 180 months after the last day of the tax year in which the COC is issued;
    • the tangible property component is allowed for up to 180 months after the last day of the tax year in which the COC is issued; and
    • the site preparation component is allowed for up to 15 taxable years after the last day of the tax year in which the COC is issued.

For more information, see Brownfield redevelopment tax credit.

[Part J, Subpart B of Chapter 59 of the Laws of 2023; Tax Law §§ 21, 187-g, 210-B(17), 606(dd), and 1511(u)]

Business income base and capital base tax rates (Article 9-A)

The 7.25% tax rate on the business income base for taxpayers with a business income base of more than $5 million and the .1875% tax rate on the capital base have been extended through tax years beginning before January 1, 2027. 

[Part I, Subpart A of Chapter 59 of the Laws of 2023; Tax Law §§ 210(1)(a) and 210(1)(b)(1)]

Child care creation and expansion tax credit (Articles 9-A, 22 and 33)

A new refundable credit is available to businesses that:

  • operate in New York State;
  • have created or expanded child care seats, directly or through a third party, for their employees on or after April 1, 2023 and before January 1, 2025; and
  • have received a certificate of tax credit or a share of the credit listed on the certificate issued by the Office of Children and Family Services (OCFS).

OCFS administers the credit by determining eligibility and issuing tax credit certificates.

The credit is equal to the sum of:

  • the product of the number of infant child care seats that have been created or expanded and 20% (0.2) of the child care rate for the infant child care seats; and
  • the product of the number of toddler child care seats that have been created or expanded and 20% (0.2) of the child care rate for the toddler child care seats.

For more information, see Child care creation and expansion tax credit. 

[Part G of Chapter 59 of the Laws of 2023; Tax Law §§ 48, 210-B(59), 606(ooo), and 1511(ee); Social Services Law §§ 394 through 394-g]

COVID-19 capital costs tax credit (Articles 9-A and 22)

The COVID-19 Capital Costs Tax Credit Program is administered by Empire State Development (ESD). The deadline to submit an application to ESD for a certificate of this tax credit was extended through September 30, 2023.

For more information, see COVID-19 capital costs credit. 

[Part F of Chapter 59 of the Laws of 2023]

Credit for taxicabs and livery services vehicles accessible to persons with disabilities (Articles 9-A and 22)

For tax years beginning on or after January 1, 2023, the credit amount has increased to $15,000 for electric vehicles as defined by section 66-s of the Public Service Law. The credit remains at $10,000 for any other vehicle. 

This credit is available through tax year 2028. 

For more information, see Credit for taxicabs and livery service vehicles accessible to persons with disabilities.

[Part L of Chapter 59 of the Laws of 2022; Tax Law §§ 210-B(38) and 606(tt)]

Empire State child credit (Article 22)

For tax years beginning on or after January 1, 2023, a qualifying child may be under four years of age.

For more information, see Empire State child credit.

[Part HH of Chapter 56 of the Laws of 2023; Tax Law § 606 (c-1)]

Empire State commercial production credit (Articles 9-A and 22)

The Empire State commercial production credit has been extended through tax year 2028.

For more information, see Empire State commercial production credit.

[Part I, Subpart C of Chapter 59 of the Laws of 2023; Tax Law §§ 28, 210-B(23) and 606(jj)]

Empire State digital gaming media production credit (Articles 9-A and 22)

For tax years beginning on or after January 1, 2023, and before January 1, 2028, a new refundable credit is available for eligible digital gaming media productions.

The credit allowed will be 25% of the qualified digital gaming media production costs, of one or more qualified digital productions, incurred in New York State. For costs incurred within New York State but outside the Metropolitan Commuter Transportation District, the credit amount increases by an additional 10%.

The aggregate total of credit allowed per year is $5 million allocated by Empire State Development (ESD). No taxpayer, however, may receive more than $1.5 million per year.

ESD administers the credit to eligible businesses by issuing tax credit certificates.

For more information, see Empire State digital gaming media production credit.

[Part OO of Chapter 59 of the Laws of 2022; Tax Law §§ 45, 210-B(55), and 606(nnn)]

Empire State film production and Empire State film post-production credits (Articles 9-A and 22)

The annual funding cap for the film production credit was increased to $700 million for 2024 through 2034, with $45 million of the $700 million dedicated to the post-production credit.  Amendments were also made, for applications received by Empire State Development (ESD) on or after April 1, 2023 (unless stated otherwise), to:

  • increase the credit rate from 25% to 30% for qualified production and post-production costs, and from 30% to 35% for the post-production credit for qualified post-production facilities located outside the Metropolitan Commuter Transportation District;
  • expand the film credit’s additional 10% rate for wages, salaries and other compensation performed in certain upstate counties to include other qualified production costs where property is used and services are performed in those upstate counties; limit the wages, salaries and other compensation of the additional 10% credit for writers, directors, composers, producers and performers to not exceed 40% of the aggregate sum total of all other qualified production costs; and remove the $5 million aggregate restriction for the additional upstate credit for tax years 2024 through 2029;
  • limit production costs of the film credit’s wages and salaries or other compensation paid to writers, directors, composers, and performers (other than background actors with no scripted lines), to $500,000 per individual.
  • reduce from 5 to 2 the number of seasons that a relocated television series must be filmed outside New York prior to its first relocated season in New York to be eligible for the credits; and
  • change the date film credits may be claimed based on the initial application date:
    • for applications filed before April 1, 2023, no credit may be claimed before the later of the tax year the production of the qualified film is complete, or the tax year immediately following the allocation year for which the film has been allocated the credit; or
    • for applications filed on or after April 1, 2023, no credit may be claimed before the later of the tax year the production of the qualified film is complete, or the tax year which includes the last day of the allocation year for which the film has been allocated the credit.

Definitions for qualified relocation costs and eligible relocated television series were added and the definition for qualified film was amended.

For certificates of tax credit issued on or after January 1, 2023, taxpayers receiving an Empire State film production credit are required to contribute half of 1% of the credit allowed to the Empire State Entertainment Diversity Job Training Development Fund. These amounts will be withheld by ESD when issuing a certificate.

Also, beginning on or after January 1, 2023, Empire State film production credit applicants are required to submit a diversity plan with the Governor’s Office of Motion Picture and Television Development outlining a specific plan for the hiring of a diverse workforce.

For more information on these credits, see Empire State film production credit and Empire State film post-production credit.

[Part D of Chapter 59 and Chapter 606 of the Laws of 2023 and Part M of Chapter 59 of the Laws of 2022; Tax Law §§ 24, 31, 210-B(20), 210-B(32), 606(gg), and 606(qq)]

Grade number 6 heating oil conversion credit (Articles 9-A and 22)

The grade number 6 heating oil conversion credit now includes conversion costs paid before January 1, 2024, rather than July 1, 2023.

For more information, see Grade Number 6 Heating Oil Conversion credit.

[Part I, Subpart D of Chapter 59 of the Laws of 2023; Tax Law §§ 47, 210-B(58) and 606(nnn)]

Investment tax credit (Articles 9-A and 22)

Eligible farmers as defined in Tax Law sections 210-B.11 and 606(n) may elect to receive a refund of their unused investment tax credit earned on property placed in service on or after January 1, 2023.

For more information, see Investment tax credit (ITC).

[Part C of Chapter 59 of the Laws of 2023; Tax Law §§ 210-B.1(d) and 606(a)(5)]

Metropolitan commuter transportation mobility tax (MCTMT) definition of net earnings from self-employment (Article 23)

The definition of net earnings from self-employment has been clarified for purposes of computing the MCTMT.

Generally, net earnings from self-employment has the same meaning as in Internal Revenue Code (IRC) § 1402.   However, in determining if the exclusion under IRC § 1402(a)(13) applies, an individual shall not be considered a limited partner if they, directly or indirectly, take part in the control, or participate in the management or operations of the partnership such that they are not a passive investor, regardless of their title or characterization in a partnership or operating agreement.

For more information, see Metropolitan commuter transportation mobility tax (ny.gov).

[Part B of Chapter 59 of the Laws of 2023; Tax Law § 800(e)]

Metropolitan commuter transportation mobility tax (MCTMT) rates for employers (Article 23)

For tax quarters beginning on or after July 1, 2023, the Metropolitan Commuter Transportation District (MCTD) is now divided into two zones for purposes of calculating the MCTMT. 

  • Zone 1 includes the counties of New York (Manhattan), Bronx, Kings (Brooklyn), Queens, and Richmond (Staten Island).
  • Zone 2 includes the counties of Rockland, Nassau, Suffolk, Orange, Putnam, Dutchess, and Westchester.

The MCTMT rates for employers with payroll expense in the MCTD greater than $312,500 are as follows:

For employers who engage in business within the MCTD in the counties of Bronx, Kings, New York, Queens, and Richmond (Zone 1):

MCTD Zone 1

Payroll expense

MCTMT rate

No greater than $375,000

.11% (.0011)

Over $375,000 but not over $437,500

.23 % (.0023)

Over $437,500

.60% (.0060)

For employers who engage in business within the MCTD in the counties of Dutchess, Nassau, Orange, Putnam, Rockland, Suffolk, and Westchester (Zone 2):

MCTD Zone 2

Payroll expense

MCTMT rate

No greater than $375,000

.11% (.0011)

Over $375,000 but not over $437,500

.23 % (.0023)

Over $437,500

.34% (.0034)

For more information, see Metropolitan commuter transportation mobility tax (ny.gov).

[Part Q of Chapter 58 of the Laws of 2023; Tax Law § 801(a)]

Metropolitan commuter transportation mobility tax (MCTMT) rates for self-employed individuals (Article 23)

For tax years beginning on or January 1, 2023, the Metropolitan Commuter Transportation District (MCTD) is divided into two zones for purposes of calculating the MCTMT for self-employed individuals. 

  • Zone 1 includes the counties of New York (Manhattan), Bronx, Kings (Brooklyn), Queens, and Richmond (Staten Island).
  • Zone 2 includes the counties of Rockland, Nassau, Suffolk, Orange, Putnam, Dutchess, and Westchester.

For tax years beginning on or after January 1, 2023 and before January 1, 2024, the MCTMT rates for self-employed individuals engaging in business within the MCTD are:

  • .47 % (.0047) of the net earnings from self-employment that are attributable to the MCTD within Zone 1, if such earnings exceed $50,000 for the tax year, and
  • .34% (.0034) of the net earnings from self-employment that are attributable to the MCTD within Zone 2, if such earnings exceed $50,000 for the tax year.

For tax years beginning on or after January 1, 2024, the MCTMT rates for self-employed individuals engaging in business within the MCTD are:

  • .60 % (.0060) of the net earnings from self-employment that are attributable to the MCTD within Zone 1, if such earnings exceed $50,000 for the tax year, and
  • .34% (.0034) of the net earnings from self-employment that are attributable to the MCTD within Zone 2, if such earnings exceed $50,000 for the tax year.

Note: The $50,000 thresholds are computed on an individual basis for each zone, even if you file a joint income tax return.

For more information, see Metropolitan commuter transportation mobility tax (ny.gov).

[Part Q of Chapter 58 of the Laws of 2023; Tax Law § 801(a)]

MTA surcharge rate (Article 9-A)

The MTA surcharge rate for Article 9-A taxpayers was legislatively set at a permanent rate of 30% for tax years beginning on or after January 1, 2024. 

For more information, see Form CT-3-M, General Business Corporation MTA Surcharge Return, and its instructions. 

[Part GG of Chapter 59 of the Laws of 2023; Tax Law §§ 209-B(1)(a) and (f)]

New York City musical and theatrical production tax credit (Articles 9-A and 22)

The credit has been extended through tax year 2025. Amendments were also made to:

  • extend the tax credit application deadline through June 30, 2025;
  • extend the credit period of a qualified New York City musical and theatrical production company to the later of when the date the qualified production closes or September 30, 2025;
  • increase the overall dollar cap for the credit to $300 million;
  • remove the $1.5 million per production cap;
  • limit the credit to $350,000 per qualified New York City musical and theatrical production in a level two qualified New York City production facility and $3 million per qualified production in a level one facility; and
  • continue the qualified production company’s obligation to make contributions to the New York State Council on the Arts, Cultural Program Fund found in Tax Law section 24-c(g)(3) through December 31, 2027.

Additionally, definitions were added for level one and level two qualified New York City production facilities and for production budget.  The definitions for qualified New York City production and qualified production expenditure were amended.

The above amendments are effective May 3, 2023, unless otherwise noted. 

This credit is administered by Empire State Development.

For more information, see New York City musical and theatrical production tax credit.

[Part I, Subpart E of Chapter 59 of the Laws of 2023; Tax Law §§ 24-c, 210-B(57), and 606(mmm)]

New York State Voluntary Contributions (Article 9-A)

For tax years beginning on or after October 25, 2023, New York State has added a new voluntary contribution fund for general business corporation franchise (Article 9-A) taxpayers:  the Diabetes Research and Education Fund. 

For more information, see Form CT-227, New York State Voluntary Contributions. 

For a description of the currently available voluntary contribution funds, see Voluntary contributions (ny.gov).

[Chapter 548 of the Laws of 2023; Tax Law § 209-Q]

Pass-through entity tax (PTET) and New York City pass-through entity tax (NYC PTET) (Articles 22, 24-A, and 24-B)

Several retroactive amendments were made to the PTET and the NYC PTET.

The Tax Law was amended to clarify that the add back of all pass-through entity taxes for pass-through entity taxable income (PTE taxable income) and NYC PTE taxable income purposes includes:

  • taxes paid under Article 24-A to New York,
  • taxes paid under Article 24-B to New York City, and
  • taxes paid to other jurisdictions that are substantially similar to the taxes paid under Article 24-A,

to the extent each of these taxes are paid and deducted for federal income tax purposes in the tax year and are included in the taxable income of the partners, members, or shareholders subject to tax under Article 22 for the tax year. The PTE taxable income provision for PTET is effective for tax years beginning on or after January 1, 2021. The NYC PTE taxable income provision for NYC PTET is effective for tax years beginning on or after January 1, 2022.

The Tax Law was amended to clarify the deadlines to revoke the PTET and NYC PTET elections. The elections are irrevocable after the due date of the entity’s first PTET or NYC PTET estimated payment. The PTET provision is effective for tax years beginning on or after January 1, 2021. The NYC PTET provision is effective for tax years beginning on or after January 1, 2022.

The Tax Law was amended to allow a city resident trust or estate, as defined in Tax Law section 1305(c), to be an eligible credit claimant for NYC PTET. This provision is effective for tax years beginning on or after January 1, 2023.

For more information, see Pass-through entity tax and New York City pass-through entity tax.

[Part J, Subpart C of Chapter 59 of the Laws of 2023; Tax Law §§ 860(h)(1)-(3), 861(c), 867(b)(1) & (2), 867(e), 867(i), 867(j), and 868(c)]

Rehabilitation of historic properties credit (Articles 9-A, 22 and 33)

The rehabilitation of historic properties credit has been extended through tax year 2029.

For more information, see Rehabilitation of historic properties credit. 

[Part I, Subpart B of Chapter 59 of the Laws of 2023; Tax Law §§ 210-B.26, 606(oo), and 1511(y)]

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