Bill Text: NY A07126 | 2023-2024 | General Assembly | Introduced
NOTE: There are more recent revisions of this legislation. Read Latest Draft
Bill Title: Amends the eligibility criteria for game development companies by changing the yearly timeframe structure, lowering the dollar threshold per production, and removing the in-state cost incurred threshold to accurately fit current digital gaming industry models.
Spectrum: Slight Partisan Bill (Democrat 9-4)
Status: (Introduced) 2024-05-17 - print number 7126b [A07126 Detail]
Download: New_York-2023-A07126-Introduced.html
Bill Title: Amends the eligibility criteria for game development companies by changing the yearly timeframe structure, lowering the dollar threshold per production, and removing the in-state cost incurred threshold to accurately fit current digital gaming industry models.
Spectrum: Slight Partisan Bill (Democrat 9-4)
Status: (Introduced) 2024-05-17 - print number 7126b [A07126 Detail]
Download: New_York-2023-A07126-Introduced.html
STATE OF NEW YORK ________________________________________________________________________ 7126 2023-2024 Regular Sessions IN ASSEMBLY May 11, 2023 ___________ Introduced by M. of A. McDONALD -- read once and referred to the Commit- tee on Ways and Means AN ACT to amend the tax law, in relation to the eligibility criteria for the digital gaming tax credit The People of the State of New York, represented in Senate and Assem- bly, do enact as follows: 1 Section 1. Subdivisions (b) and (c) of section 45 of the tax law, as 2 added by section 1 of part OO of chapter 59 of the laws of 2022, is 3 amended to read as follows: 4 (b) Allocation of credit. The aggregate amount of tax credits allowed 5 under this section, subdivision fifty-five of section two hundred ten-B 6 and subsection (nnn) of section six hundred six of this chapter in any 7 taxable year shall be five million dollars. Such credit shall be allo- 8 cated by the department of economic development in order of priority 9 based upon the date of filing an application for allocation of digital 10 gaming media production credit with such office. An applicant shall 11 submit an annual application which shall include all qualified digital 12 gaming media productions for the taxable year along with an estimate of 13 the digital gaming media production costs. The application shall be 14 submitted no later than the end of the applicable taxable year. If the 15 total amount of allocated credits applied for in any particular year 16 exceeds the aggregate amount of tax credits allowed for such year under 17 this section, such excess shall be treated as having been applied for on 18 the first day of the subsequent taxable year. 19 (c) Definitions. As used in this section: 20 (1) "Qualified digital gaming media production" means: (i) a website, 21 the digital media production costs of which are paid or incurred predo- 22 minately in connection with (A) video simulation, animation, text, 23 audio, graphics or similar gaming related property embodied in digital 24 format, and (B) interactive features of digital gaming (e.g., links, 25 message boards, communities or content manipulation); (ii) video or EXPLANATION--Matter in italics (underscored) is new; matter in brackets [] is old law to be omitted. LBD11262-01-3A. 7126 2 1 interactive games produced primarily for distribution over the internet, 2 wireless network or successors thereto; and (iii) animation, simulation 3 or embedded graphics digital gaming related software intended for 4 commercial distribution regardless of medium; provided, however, that 5 the qualified digital game development media productions described in 6 subparagraphs (i) through (iii) of this paragraph must have digital 7 media production costs equal to or in excess of [one hundred] fifty 8 thousand dollars per production. A qualified digital gaming media 9 production does not include a website, video, interactive game or soft- 10 ware that is used predominately for: electronic commerce (retail or 11 wholesale purposes other than the sale of video interactive games), 12 gambling (including activities regulated by a New York gaming agency), 13 or political advocacy purposes. 14 (2) "Digital gaming media production costs" means any costs for wages 15 or salaries paid to individuals, other than actors or writers, directly 16 employed for services performed by those individuals directly and 17 predominantly in the creation of a digital gaming media production or 18 productions. Up to one hundred thousand dollars in wages and salaries 19 paid to such employees, other than actors and writers, directly employed 20 shall be used in the calculation of this credit. Digital gaming media 21 production costs include but shall not be limited to payments for 22 services performed directly and predominantly in the development 23 (including concept creation), design, production (including concept 24 creation), design, production (including testing), editing (including 25 encoding) and compositing (including the integration of digital files 26 for interaction by end users) of digital gaming media. Digital gaming 27 media production costs shall not include expenses incurred for the 28 distribution, marketing, promotion, or advertising content generated by 29 end users, other costs not directly and predominantly related to the 30 creation, production or modification of digital gaming media or costs 31 used by the taxpayer as a basis of the calculation of any other tax 32 credit allowed under this chapter. In addition, salaries or other income 33 distribution related to the creation of digital gaming media for any 34 person who serves in the role of chief executive officer, chief finan- 35 cial officer, president, treasurer or similar position shall not be 36 included as digital gaming media production costs if the digital gaming 37 media production entity has more then ten employees. Salaries or other 38 income to a person serving in such a role for the digital gaming media 39 production entity shall also not be included if the person was employed 40 by a related person of the digital gaming media production entity within 41 sixty months of the date the digital gaming media production entity 42 applied for the tax credit certificate described in subdivision (d) of 43 this section. For purposes of the preceding sentence, a related person 44 shall have the same meaning as the term "related person" in section four 45 hundred sixty-five of the internal revenue code. Furthermore, any income 46 or other distribution to any individual including, but not limited to, 47 licensing or royalty fees, who holds an ownership interest in a digital 48 gaming media production entity, whether or not such individual is serv- 49 ing in the role of chief executive officer, chief financial officer, 50 president, treasurer or similar position for such an entity, shall not 51 be included as digital gaming media production costs. Up to four million 52 dollars in qualified digital gaming media production costs per 53 production shall be used in the calculation of this credit. Digital 54 gaming media production costs shall not include those costs used by the 55 taxpayer or another taxpayer as the basis calculation of any other tax 56 credit allowed under this chapter.A. 7126 3 1 (3) "Qualified digital gaming media production costs" means digital 2 gaming media production costs only to the extent such costs are attrib- 3 utable to the use of property or the performance of services by any 4 persons within the state directly and predominantly in the creation, 5 production or modification of digital gaming related media. [Such total6production costs incurred and paid in this state shall be equal to or7exceed seventy-five percent of total cost of an eligible production8incurred and paid within and without this state.] 9 (4) "Digital gaming media production entity" means a corporation, 10 partnership, limited partnership or other entity or individual engaged 11 in qualified digital game development media production. 12 § 2. This act shall take effect immediately.
