IT-606: Claim for QEZE Credit for Real Property Taxes (2024)
New York · NY DTF · Used for tax years 2024
New York Form IT-606 is used to claim the QEZE credit for real property taxes for a qualified empire zone enterprise. It reports employment figures, eligible real property taxes, and calculations of the credit, including recapture and limitations.
Who files this form
Form IT-606 is used to claim the credit for real property taxes for a qualified empire zone enterprise (QEZE). Submit it with Form IT-201, IT-203, IT-204, or IT-205.
The form has two sections based on when the QEZE was first certified by Empire State Development:
- Section 1: First certified before April 1, 2005.
- Section 2: First certified on or after April 1, 2005.
The form includes employment tests. If you fail the tests in your section, the form tells you to stop because you are not eligible for the credit. Partners, shareholders, and beneficiaries are directed to the instructions for their credit entries.
What you'll need
Have the following information and attachments ready, as applicable:
- Certification documents: Copies of all certificates of eligibility and EZ retention certificates, plus the date of first certification.
- Business details: Taxpayer identification number, QEZE name and EIN, empire zone names, and tax period.
- Employment information: Full-time employee counts for the current year and the applicable five-year or four-year base period. Section 1 also requests test-year employment information.
- Real property tax information: Eligible real property tax amounts. Section 2, line 46, specifically requires supporting documentation.
- New employee details for Schedule K: Names, Social Security numbers, zone locations, wages, health benefits, and retirement benefits.
- Related business information: Names and EINs of related entities, with additional sheets if needed.
- Capital investment information for Schedule Q: Property addresses, zone names if applicable, cost or other basis, and occupancy and use percentages.
If a QEZE first certified before August 1, 2002, is claiming it was formed for a valid business purpose, Schedule G requires a notarized statement explaining in detail how it meets that test.
How to file
- Complete the information above Section 1 on page 1, including your tax period and certification details.
- Complete either Section 1 or Section 2 based on your first certification date. Do not complete both.
- Include the required certificates and any other applicable attachments.
- Submit all eight pages of Form IT-606 with Form IT-201, IT-203, IT-204, or IT-205, even though you complete only one section.
The supplied form text does not give a mailing address or e-file directions.
Common mistakes
- Leaving out unused pages: The form requires all eight pages with your return.
- Completing both sections: Complete only the section that matches your first certification date.
- Leaving employees out of the all-EZ counts: Include employees within all empire zones, even zones where you are not certified.
- Rounding employment numbers: Do not round entries marked “do not round.” Follow the separate rounding directions for calculated factors.
- Continuing after a failed employment test: The form tells you to stop if you do not meet the applicable employment comparisons.
- Entering zero on line 21: The credit limitation line specifically says not to enter 0.
- Exceeding the Schedule K limit: Column E allows no more than $40,000 per employee.
- Completing both parts of Schedule Q: Complete only Part 1 or Part 2.
Questions people ask
Can unchanged employment meet the form's employment tests?
For Section 1, current-year employment must equal or exceed base-period employment both within all EZs and within New York State outside all EZs. For Section 2, current-year employment must exceed base-period employment both within all EZs and across New York State.
How long is the credit generally available for QEZEs first certified before April 1, 2005?
Schedule D says the credit is generally available for up to 14 years for taxpayers that continue to qualify. Its benefit-period factor table lists a factor of 0 for year 15.
Does certification on or after April 1, 2009, affect the calculation?
Yes. Section 2, line 47b, requires QEZEs certified on or after that date to multiply line 47a by 75%. Those certified before that date enter the full line 47a amount.
Where does the form direct me for more help?
It refers you to Form IT-606-I, Instructions for Form IT-606. Those instructions were not included in the supplied text.