IT-638: START-UP NY Tax Elimination Credit (2025)
New York · NY DTF · Used for tax years 2025
Form IT-638 is used to calculate the New York START-UP NY Tax Elimination Credit. It reports business certification information, allocation and tax factors, and the total credit, with separate sections for pass-through entity information and estate or trust income shares.
Who files this form
Form IT-638 is used to claim the START-UP NY Tax Elimination Credit. The form covers:
- Individuals (sole proprietors), partnerships, and fiduciaries of estates or trusts that earned the credit.
- Partners, shareholders, and beneficiaries receiving a share of the credit.
Submit it with Form IT-201, IT-203, IT-204, or IT-205, as applicable.
What you'll need
Have the following information available, depending on the schedules you must complete:
- Form DTF-74, Certificate of Eligibility: the approved business’s certificate number and sponsor name or names.
- Your tax return: the name, identifying number, tax, income, and other credit amounts requested on IT-638.
- Business information: the year of the START-UP NY business tax benefit period, from 1 to 10.
- For Schedule A: average property values and employee wages, salaries, and other compensation for the tax-free NY area and New York State.
- For Schedule B: each entity’s name, type, EIN, certificate number, and year of its business tax benefit period.
- For Schedule C: beneficiary names and identifying numbers, and the estate’s or trust’s START-UP NY business income and its allocation to beneficiaries.
How to file
Submit Form IT-638 with Form IT-201, IT-203, IT-204, or IT-205. The supplied form does not give a mailing address or e-file instructions.
All filers must complete line A, then lines B, C, and D. Use your answer to line A to choose the schedules:
- Yes, individual (sole proprietor): Schedules A, D, and E.
- Yes, partnership: Schedule A.
- Yes, fiduciary: Schedules A, C, D, and E.
- No: Schedules B, D, and E. Fiduciaries also complete Schedule C.
Partnerships enter the Schedule A, line 6 allocation factor on Form IT-204, line 151. All other filers enter it on IT-638, line 17.
Common mistakes
- Skipping line A: the form says all filers must complete it.
- Leaving the tax period unclear: calendar-year filers must mark the box; other filers must enter beginning and ending dates.
- Entering an invalid benefit-period year: line D calls for a number from 1 to 10.
- Exceeding the line 15 limit: the result cannot exceed 1.0 and must be rounded to the fourth decimal place.
- Leaving out additional credit amounts: include any Schedule E, line 19 amounts from additional Forms IT-638 on line 20.
Questions people ask
Where do I find the certificate number and sponsor names?
Use Form DTF-74, Certificate of Eligibility, issued to the approved START-UP NY business.
What if I am certified by multiple sponsors?
Mark Yes on line C and enter the sponsor names from Form DTF-74.
How do I identify an entity in Schedule B?
Enter P for a partnership, S for an S corporation, or ET for an estate or trust. Use additional Forms IT-638 if necessary.
How is the total credit calculated on Schedule E?
Multiply the allocation factor on line 17 by the tax factor on line 18 to get line 19. Add any line 19 amounts from additional Forms IT-638 on line 20, then add lines 19 and 20 to get the total credit on line 21.