![]() ![]() In the event that the entity applies for the loan in its first year of operations, satisfaction of the requirements in the preceding sentence is determined by the employees, receipts and assets of the business on the date of the loan application. Note that if a loan satisfies the conditions set forth in 11-652(8)(t)(iii)(B)(I) and (II), the taxpayer must apply the proportionality restriction in sub-item (I).Ī loan will be considered a “small business loan” if made to an active business that has had, for federal income tax purposes, an average number of full-time employees of 100 or fewer, not including general executive officers, and gross receipts of not greater than $10,000,000 in its immediately preceding taxable year. Contemporaneous census data, used for purposes of applying section 45D of the Internal Revenue Code of 1986, as amended, that includes the location of the property securing the qualifying loan, if applicable.Contemporaneous identification of the building on the New York Division of Housing and Community Renewal registration file, together with a contemporaneous list of the rent-stabilized apartments.Leases for any apartments subject to rent control,.A rent roll that is contemporaneous with, or existing at the origination of, each qualifying loan.Loan agreement, promissory note and mortgage for each qualifying loan originated by the taxpayer, or, if the taxpayer acquired the loan immediately after origination, the purchase and sale agreement, the allonge, and assignments for the loan agreement and mortgage.Balance sheet and supporting documentation for the reported asset values.Supporting documentation for the reported interest from loans.The Department of Finance will review documents that establish your client’s eligibility for the exception and its calculation of the subtraction, including, but not limited to: If the loan is refinanced at a later date, you must re-determine the type of loan and the amount of income to apportion to New York City. The determination of the type of loan, fair market value of real property, and borrower’s location is made at the time the loan is entered into. A business entity is considered located in New York City if the entity’s commercial domicile is in New York City. An individual is considered located in New York City if the individual’s billing address is in New York City. Interest income from loans not secured by real property (and not QFI, or QFI with no election to use fixed percentage method) is apportioned to New York City if the borrower is located in New York City. If the loan is secured by real property located inside and outside of New York City, the amount of interest income apportioned to New York City is computed by multiplying the total interest income from the loan by the following ratio:įair Market Value of Real Property Located in New York City Used to Secure the Loan Fair Market Value of all Real Property Used to Secure the Loan All the interest income from a loan secured by real property located in New York City is apportioned to New York City. ![]() The loan is considered a loan secured by real property if 50% or more of the fair market value of the collateral used to secure the loan consists of real property.
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