Application period open for $250 million COVID-19 Capital Costs Tax Credit Program

Small businesses with 100 or fewer employees may receive tax credits for costs incurred to increase Safety

√ Screening tool available here

Gov. Kathy Hochul announced applications are now being accepted from small businesses that have successfully completed the prescreening process to become certified for the COVID-19 Capital Costs Tax Credit Program, which supports companies that made investments to comply with emergency orders and regulations or to increase public safety in response to the coronavirus.

"When the pandemic devastated the bottom line of most small businesses across New York state, I pledged to lend them a helping hand from day one," Hochul said. "This tax credit will be a crucial lifeline to New York small businesses – the backbone of our state's economy – and I encourage all who are interested to apply for this much-needed aid."

This new, refundable tax relief program targets COVID-19-related expenses for infectious disease mitigation during 2021 and 2022. Eligible costs include, but are not limited to:

√ Supplies to disinfect or protect against coronavirus transmission

√ Costs associated with expanding, or defining space to accommodate social distancing

√ HVAC equipment

√ Expenses related to increased outdoor activity and outdoor space expansions

√ Machinery and equipment to facilitate contactless sales

Tax credits will cover 50% of eligible costs, up to $50,000, for a maximum tax credit award of $25,000, and credits will be awarded on a first-come, first-served basis until program funds are depleted. Eligible businesses must operate a location in New York, have 100 or fewer employees, $2.5 million or less of gross receipts in the 2021 tax year, and at least $2,000 in eligible costs between Jan. 1, 2021, and Dec. 31, 2022.

Applications will be accepted through March 31, 2023. To claim a tax credit for their 2022 tax return, businesses must apply soon to receive a tax credit certificate from Empire State Development (ESD) on or before Dec. 31, 2022. Tax credits issued on or after Jan. 1, 2023, can be claimed on a business's 2023 tax return.

To learn more about eligibility and qualifying expenses, visit www.esd.ny.gov/covid-19-capital-costs-tax-credit. ESD has contracted with the FORWARD Platform to screen business applications, validate expenses and distribute credits for the program.

More than $1 billion have been targeted toward small business recovery in Hochul's first budget, including the $250 million COVID-19 Capital Costs Tax Credit, the $800 million Pandemic Small Business Recovery Grant Program, and the $200 million Seed Funding Grant Program to support early stage, micro and small businesses that opened shortly before or during the pandemic.

Empire State Development President, CEO and Commissioner Hope Knight said, "Through no fault of their own, small businesses across the state had to pay for many expenses during the pandemic that were necessary to keep their employees and customers safe, but not expected or budgeted. Under Gov. Hochul's leadership, the COVID-19 Capital Costs Tax Credit Program will help ease the burden that the business community incurred during the pandemic and help it continue to get steadily back on its feet."

New York State Sen. Anna M. Kaplan said, "Small businesses had to incur significant expenses to reopen safely during the pandemic and, with those costs continuing to mount, they need our support more than ever. I was proud to sponsor the COVID-19 Capital Costs Tax Credit Program, which will help minimize the financial impacts incurred by small business owners to stay safe and stay open, and I encourage every small business owner to find out if they're eligible and apply for relief without delay."

Assembly member Al Stirpe said, "As the chair of the Assembly Small Business Committee, it remains a priority of mine to aid local entrepreneurs in any way possible because I know the dedication required, day in and day out, to keep the lights on. Small business accounts for 98% of all business in NYS, and those owners employ 53% of the work force. They are the fuel to our economic engine, and we must continue to support them as unexpected safety costs – that included everything from outdoor service areas to new HVAC systems – hit them hard. As they sacrificed to serve our communities, we must aid them to make a full recovery from the pandemic. The opening of the COVID-19 Capital Costs Tax Credit Program applications is the support that small business owners have come to expect from NYS. Let's all get back to work!"

The FORWARD Platform is an Integrated Program Administration (IPA) solution for state and local governments across America. To learn more, visit www.forwardplatform.com.

Empire State Development (ESD) is New York's chief economic development agency. Visit www.regionalcouncils.ny.gov and www.esd.ny.gov.