New York Codes, Rules and Regulations › Title 20 - DEPARTMENT OF TAXATION AND FINANCE › Chapter I - Franchise and Certain Business Taxes › Subchapter A - Business Corporation Franchise Tax › Part 9 - SPECIAL ENTITIES › Subpart 9-1 - QUALIFIED NEW YORK MANUFACTURERS › Section 9-1.2 - Definition of qualified New York manufacturer

Current through Register Vol. 46, No. 28, July 10, 2024
(Tax Law, section 210(1)(a)(vi) and 210(1)(b)(2))
(a) A corporation or, in the case of a
					 combined report, a combined group, engaged in the production of goods by
					 manufacturing, processing, assembling, refining, mining, extracting, farming,
					 agriculture, horticulture, floriculture, viticulture, or commercial fishing
					 during the taxable year will be a qualified New York manufacturer if the
					 criteria in paragraph (1) or (2) of this subdivision are met.
(1)
(i) The
					 corporation or combined group derives more than 50% of its gross receipts
					 during the taxable year from its sale of goods produced by manufacturing,
					 processing, assembling, refining, mining, extracting, farming, agriculture,
					 horticulture, floriculture, viticulture, or commercial fishing (hereinafter
					 referred to as the "principally engaged test") and has qualified manufacturing
					 property that has a New York adjusted basis of at least one million dollars at
					 the end of the taxable year or has all its real and personal property in New
					 York State for the entire taxable year.
(ii) The corporation's sale of goods requires
					 that title be transferred from the taxpayer to another party, except in
					 instances of contracts covering more than one taxable year for the ultimate
					 sale of goods. Any receipts earned pursuant to such contracts in each taxable
					 year shall be deemed a sale of goods even though transfer of title has not yet
					 occurred. The sale of a good shall not include:
(a) the licensing of goods;
(b) the sale of a warranty;
(c) the sale of an insurance contract;
					 or
(d) the sale of advertising
					 related to the good.
(iii) To determine whether the corporation or
					 the combined group has satisfied the principally engaged test, the total
					 everywhere receipts as determined under this Subchapter of the corporation or,
					 in the case of a combined report, the combined group, shall be multiplied by a
					 fraction. The denominator of the fraction used to compute the principally
					 engaged test is the corporation's or combined group's everywhere receipts,
					 except that any global intangible low-taxed income as defined in IRC section
					 951A must be excluded. The numerator of the fraction is the portion of such
					 everywhere receipts derived from the sale, by the taxpayer or combined group,
					 of goods produced by manufacturing, processing, assembling, refining, mining,
					 extracting, farming, agriculture, horticulture, floriculture, viticulture, or
					 commercial fishing. Receipts from the foregoing activities are combined when
					 determining the numerator of the fraction for the principally engaged
					 test.
(iv) In the case of a
					 combined report, intercorporate receipts are eliminated in the computation of
					 the principally engaged test.