York Introduces Security-Training Tax Credit
Mark H. Levin
- On August 16, 2005, Governor Pataki signed Chapter 537 of
the Laws of 2005 (A8410/S5431-B), an act creating a new “security
training tax credit” for New York State. A qualified
building owner who is subject to any of the following taxes
shall be allowed a security-training credit against such tax:
Article 9, Corporation Tax
Article 9-A, Business Corporation Franchise Tax
Article 22, Personal Income Tax
Article 32, Banking Corporation Franchise Tax
Article 33, Insurance Corporation Franchise Tax.
credit is effective for tax years beginning on or after
January 1, 2005.
security-training credit shall equal the sum of the number
of qualified security officers providing protection to a
building or buildings owned by the taxpayer, multiplied
by $3,000. If any qualified security officer is employed
less than a year, the credit shall be prorated to reflect
the length of employment.
Articles 9, 9-A, 32, and 33, the credit cannot reduce the
tax payable to an amount less than the applicable fixed
dollar minimum tax. For Article 22, the credit cannot reduce
the tax payable to less than zero. If, however, the amount
of the credit allowable for any taxable year reduces the
tax to the applicable fixed dollar minimum tax for Articles
9, 9-A, 32, or 33, or to zero for Article 22, any amount
of credit not deductible in that year shall be treated as
an overpayment of tax to be refunded with no interest payable
A qualified building owner is a building owner whose building’s
entrances, exits, and common areas are protected by security
personnel, licensed under the General Business Law Article
7-A, whether such security personnel are employed directly
by the building owner or indirectly through a contractor.
A qualified security-training program is a program for
residential and commercial building security officers,
that is designed to: improve observation, detection, and
reporting skills; improve coordination with local police,
fire, and emergency services; provide and improve skills
and working knowledge of advanced security technology,
including surveillance systems and access-control procedures;
that requires at least 40 hours of training, including
three hours devoted to terrorism awareness; and has been
certified as a qualified program and that approved by
the New York State Office of Homeland Security (OHS) pursuant
to Executive Law section 709.
A security officer, as registered under General Business
Law Article 7-A, is responsible for the safety and security
of tenants and occupants of commercial buildings over
500,000 square feet, whether such security officer is
employed directly by the building owner or indirectly
through a contractor.
A qualified security officer is a security officer who
has completed a qualified security-training program and
is employed in positions which are under a legally binding
written agreement (including a service contract between
qualified building owners and security contractors) that
provides for a minimum hourly wage as follows:
For 2005, at least $9.50 per hour;
For 2006, at least $9.85 per hour; and
For 2007 and thereafter, at least $10.85 per hour.
Scope of the credit: The credit is allowed for any taxable
year in which costs relating to security personnel are
paid or incurred.
Credit certification: Upon application by a taxpayer,
the OHS may issue a credit certification where the taxpayers
meet the standards established by this law and have demonstrated
that they have provided the appropriate training, or will
provide the appropriate training within the year, to all
employees for whom they will claim the credit.
an OHS certification is required, as of this writing, the
OHS, along with the Department of Taxation and Finance,
is still developing the training requirements, applicable
regulations, and application procedures necessary for the
implementation of the security training tax credit.
and preparers should keep abreast of any further developments
in this area. It is the author’s understanding that
the OHS has promulgated draft regulations. For more information,
center the Office of Homeland Security at www.security.state.ny.us/training/security_guard_bill_document.html
H. Levin, CPA, is manager, state and local
taxes, at H.J. Behrman & Company, LLP, New York, N.Y.