CT-640: START-UP NY Telecommunication Services Excise Tax Credit (2024)

Who files this form

Form CT-640 is for corporations claiming the START-UP NY Telecommunication Services Excise Tax Credit. The form covers C corporations and New York S corporations, including corporate partners claiming a share of the credit received from a partnership.

All filers must complete line A to indicate whether they earned the credit themselves or are claiming it as a corporate partner.

What you'll need

Have the following information available to complete the form:

• Your corporation’s legal name, EIN, and tax period beginning and ending dates.
• The certificate number from Form DTF-74, Certificate of Eligibility, issued to the approved START-UP NY business.
• The year of the START-UP NY business tax benefit period, entered as a number from 1 to 10.
• If completing Schedule A, the average value of property and employee wages and other compensation for the tax-free NY area and New York State.
• The amount of telecommunication services excise tax paid.
• If claiming a partnership credit, each partnership’s name, EIN, certificate number, year of business tax benefit period, and allocated credit amount.
• If completing Schedule C, your tax due before credits and tax credits claimed before this credit.

How to file

File Form CT-640 with Form CT-3, CT-3-A, or CT-3-S. The supplied form does not give a mailing address or e-file directions.

Enter your tax period, corporation name, and EIN. Complete line A, then follow the route that applies to you:

| Filer | If you earned the credit: line A is Yes | If claiming as a corporate partner: line A is No |

| --- | --- | --- |

| C corporation | Complete lines B and C and Schedules A, B, and C | Complete lines B and C and Schedules B, C, and D |

| New York S corporation | Complete lines B and C and Schedules A and B | Complete lines B and C and Schedules B and D |

For Schedule D, submit additional forms as necessary. Enter the total partnership credit on line 19 and line 8.

If completing Schedule C, also enter the amounts from lines 15, 17, and 18 on your franchise tax return.

Common mistakes

• Leaving required entries blank: All filers must enter their tax period and complete line A.
• Completing Schedule C as a New York S corporation: The form says New York S corporations do not complete this schedule.
• Using the wrong precision: Carry the results on lines 2, 4, and 6 to four decimal places.
• Entering a negative amount on line 14: If line 13 is more than line 12, enter 0.
• Overstating the credit used or refund: Line 15 must be the lesser of line 9 or line 14. The refund on line 17 is limited to the unused credit on line 16.
• Using an invalid benefit-period year: Line C calls for a number from 1 to 10.

Questions people ask

How is the total credit calculated?

Add the telecommunication services excise tax paid on line 7 to the partnership credit on line 8. Enter the total on line 9.

How is the allocation factor calculated?

Divide the tax-free NY area property value by the New York State property value to get the property factor. Do the same for wages and other compensation to get the wage factor. Add those factors and divide by two. Carry the results on lines 2, 4, and 6 to four decimal places.

Where do I report credit received from partnerships?

Report partnership information and allocated credit amounts in Schedule D. Submit additional forms as necessary. Enter the total allocated credit on line 19 and line 8.

Can unused credit be refunded or applied to the next period?

Schedule C provides for both. Line 17 reports the amount to be refunded, limited to the unused credit on line 16. Line 18 reports the remainder to be applied as an overpayment to the next period. New York S corporations do not complete Schedule C.

Official sources

• https://www.tax.ny.gov/pdf/2024/corp/ct640_2024.pdf