N.Y.
Tax Law Section 24-C
New York city musical and theatrical production tax credit
(a)
(1) Allowance of credit. A taxpayer that is a qualified New York city musical and theatrical production company, or is a sole proprietor of or a member of a partnership that is a qualified New York city musical and theatrical production company, and that is subject to tax under article nine-A or twenty-two of this chapter, shall be allowed a credit against such tax, pursuant to the provisions referred to in subdivision (d) of this section, and to be computed as provided in this section.(2)
The amount of the credit shall be the product (or pro rata share of the product, in the case of a member of a partnership) of twenty-five percent and the sum of the qualified production expenditures paid for during the qualified New York city musical and theatrical production’s credit period. Provided however that the amount of the credit cannot exceed three hundred fifty thousand dollars per qualified New York city musical and theatrical production in a level two qualified New York city production facility and three million dollars per qualified New York city musical and theatrical production in a level one qualified New York city production facility. In no event shall a qualified New York city musical and theatrical production be eligible for more than one credit under this program.(3)
No qualified production expenditures used by a taxpayer either as the basis for the allowance of the credit provided pursuant to this section or used in the calculation of the credit provided pursuant to this section shall be used by such taxpayer to claim any other credit allowed pursuant to this chapter.(b)
Definitions. As used in this section, the following terms shall have the following meanings:(1)
“Qualified New York city musical and theatrical production” means a for-profit live, dramatic stage presentation that, in its original or adaptive version, is performed in a level one or level two qualified New York city production facility, whether or not such production was performed in a level one or level two qualified New York city production facility prior to the state disaster emergency pursuant to executive order two hundred two of two thousand twenty, provided, however, that productions performing in a level two qualified New York city production facility shall have a production budget greater than or equal to seven hundred fifty thousand dollars and incur qualified production expenditures greater than or equal to seven hundred fifty thousand dollars.(2)
“Qualified production expenditure” means any costs for tangible property used and services performed directly and predominantly in the production of a qualified musical and theatrical production within the state of New York, including:(i)
expenditures for design, construction and operation, including sets, special and visual effects, costumes, wardrobes, make-up, accessories and costs associated with sound, lighting, and staging;(ii)
all salaries, wages, fees, and other compensation including related benefits for services performed of which the total allowable expense shall not exceed two hundred thousand dollars per week; and(iii)
technical and crew production costs, such as expenditures for a level one or level two qualified New York city production facility, or any part thereof, props, make-up, wardrobe, costumes, equipment used for special and visual effects, sound recording, set construction, and lighting. Qualified production expenditure does not include any costs incurred prior to the credit period of a qualified New York city musical and theatrical production company.(3)
(i) “Level one qualified New York city production facility” means a facility located within the (A) borough of Manhattan, bounded by and including forty-first street and fifty-fourth street and between sixth avenue and ninth avenue in which live theatrical productions are or are intended to be primarily presented, (B) that contains at least one stage, a seating capacity of five hundred or more seats, and dressing rooms, storage areas, and other ancillary amenities necessary for the qualified musical and theatrical production, and (C) for which receipts attributable to live theatrical productions constitute seventy-five percent or more of gross receipts of the facility.(ii)
“Level two qualified New York city production facility” means a facility located within the borough of Manhattan (A) in which live theatrical productions are or are intended to be primarily presented, (B) that contains at least one stage, a seating capacity of one hundred or more seats, and dressing rooms, storage areas, and other ancillary amenities necessary for the qualified musical and theatrical production, and (C) for which receipts attributable to live theatrical productions constitute seventy-five percent or more of gross receipts of the facility.(4)
“Qualified New York city musical and theatrical production company” is a corporation, partnership, limited partnership, or other entity or individual which or who is principally engaged in the production of a qualified musical or theatrical production that is to be performed in a level one or level two qualified New York city production facility.(5)
(i) “The credit period of a qualified New York city musical and theatrical production company” is the period starting on the production start date and ending on the earlier of the date the qualified musical and theatrical production has expended sufficient qualified production expenditures to reach its credit cap, September thirtieth, two thousand twenty-five or the date the qualified musical and theatrical production closes.(ii)
“The production start date” is the date that is up to twelve weeks prior to the first performance of the qualified musical and theatrical production.(6)
“Production budget” means all estimated costs to be incurred or paid before the first public appearance.(c)
The credit shall be allowed for the taxable year beginning on or after January first, two thousand twenty-one but before January first, two thousand twenty-six. A qualified New York city musical and theatrical production company shall claim the credit in the year in which its credit period ends.(d)
Cross-references. For application of the credit provided for in this section, see the following provisions of this chapter:(1)
article 9-A: section 210-B: subdivision 57;(2)
article 22: section 606: subsection (mmm).(e)
Notwithstanding any provision of this chapter, (i) employees and officers of the department of economic development and the department shall be allowed and are directed to share and exchange information regarding the credits applied for, allowed, or claimed pursuant to this section and taxpayers who are applying for credits or who are claiming credits, including information contained in or derived from credit claim forms submitted to the department and applications for certification submitted to the department of economic development, and(ii)
the commissioner and the commissioner of the department of economic development may release the names and addresses of any qualified New York city musical and theatrical production company entitled to claim this credit and the amount of the credit earned by such company.(f)
Maximum amount of credits.(1)
The aggregate amount of tax credits allowed under this section, subdivision fifty-seven of section two hundred ten-B and subsection (mmm) of § 606 (Credits against tax)section six hundred six of this chapter shall be three hundred million dollars. Such aggregate amount of credits shall be allocated by the department of economic development among taxpayers based on the date of first performance of the qualified musical and theatrical production.(2)
The commissioner of economic development, after consulting with the commissioner, shall promulgate regulations to establish procedures for the allocation of tax credits as required by this section. Such rules and regulations shall include provisions describing the application process, the due dates for such applications, the standards that will be used to evaluate the applications, the documentation that will be provided by applicants to substantiate to the department the amount of qualified production expenditures of such applicants, and such other provisions as deemed necessary and appropriate. Notwithstanding any other provisions to the contrary in the state administrative procedure act, such rules and regulations may be adopted on an emergency basis. In no event shall a qualified New York city musical and theatrical production submit an application for this program after June thirtieth, two thousand twenty-five.(g)
Any qualified New York city musical and theatrical production company that performs in a level one or level two qualified New York city production facility and applies to receive a credit under this section shall be required to:(1)
participate in a New York state diversity and arts job training program;(2)
create and implement a plan to ensure that their production is available and accessible for low-or no-cost to low income New Yorkers; and(3)
contribute to the New York state council on the arts, cultural program fund an amount up to fifty percent of the total credits received if its production earns ongoing revenue prospectively after the end of the credit period that is at least equal to two hundred percent of its ongoing production costs, with such amount payable from twenty-five percent of net operating profits, such amounts payable on a monthly basis, up until such fifty percent of the total credit amount is reached. Any funds deposited pursuant to this subdivision may be used for arts and cultural grant programs of the New York state council on the arts as specified in subdivision five of State Finance Law § 99-LL (New York state council on the arts cultural programs fund)section ninety-nine-ll of the state finance law. * NB Repealed January 1, 2026
Source:
Section 24-C — New York city musical and theatrical production tax credit, https://www.nysenate.gov/legislation/laws/TAX/24-C (updated Jun. 23, 2023; accessed Oct. 26, 2024).
