New York – New Reporting Requirement for Industrial Development Agencies and Authorities

SALT Report 2419 – The New York Department of Taxation and Finance issued a special notice that provides interim guidance for the new reporting requirement for Industrial Development Agencies and Authorities that took effect on March 28, 2013.

Part J of Chapter 59 of the Laws of 2013 was amended make several changes to how Industrial Development Agencies and Authorities (IDAs) report the state and local sales and use tax exemption benefits it provides to a project. The amendments follow:

  • IDA’s must report to the Department the amount of state and local sales and use tax exemption benefits it provides to a project within 30 calendar days of providing the benefit,
  • IDA’s must also provide the estimated value of all goods and services to be exempted, and
  • IDA’s must indicate the project that is receiving the benefits and agree to supply any other information the Department may request

The Department notes that Form ST-60, IDA Appointment of a Project Operator or Agent, has been updated so that the IDA can meet the new reporting requirement. Failure to file the report may result in the revocation of the IDA’s ability to provide sales and use tax exemption benefits.

Additionally, Form ST-60 cannot be used as an exemption certificate. Instead, all contractors or purchasers appointed as an agent for the IDA are required to obtain a signed letter from the IDA that identifies the contract, the project, the purchaser, and also authorizes the purchaser to make purchases for the project as agent of the IDA.

When making purchases as an approved agent, the purchaser must provide the supplier with a copy of the letter to verify the exemption. The supplier is required to clearly indicate the project on each bill or invoice as well as that the IDA or an agent for the IDA was the purchaser.

Finally, if an IDA amends, revokes, or cancels an agent’s position, or if an agent’s position becomes invalid for any reason, the IDA must send a letter to the Department within 30 days indicating the change in appointment.

For Further Information

New York Department of Taxation – Important Notice N-13-3