Why are some of the top global businesses situated in New York? There are several reasons why there has been a spurt in the number of startup companies in New York being registered in that state.
New York City is considered as one of the top business-friendly destinations in the world. Whether you are considering forming an LLC or incorporating your business, this is the destination from where you can reach out to national and global markets.
The good news is that if you are planning to register a new company in New York then you might qualify for the specific incentive programs offered by the state. These programs will benefit your LLC or Corporation in the long-term.
Advantages that Businesses can capitalize on
When we talk of advantages for a startup company in New York, there are many tax advantages, credibility factor, and the most talked about “state incentives”. Let us take a look at some of the benefits:
Advantage#1: Tax Benefits
Although, New York is not known to have the most business friendly tax environment in the nation, it does make up for this by offering several types of tax benefits as well as incentives when you register a new business in New York. This helps greatly in reducing the overall tax burden on businesses. One of the most trusted and popular tax benefit program is the “Startup New York”. As part of the program, selected businesses (those that meet specific criteria) can enjoy 10 years of tax free operation in a specific location, that has been designed to encourage more start-ups.
Advantage#2: Federal Work Opportunity Tax Credit (WOTC)
It is a type of Federal tax credit that will be available to your business after you register a new company in New York. The tax credit is offered if your business hires individuals or employees from those target groups that have been consistently facing significant barriers when it comes to employment. The maximum amount of tax credit can range from $1,200 to $9,600, and the amount varies according to the type of employee hired. The targeted group includes:
- Qualified unemployed veterans including those with disability
- Temporary Assistance for Needy Families (TANF) recipients
- Designated Community Residents especially those living in rural renewal counties or empowerment zones
- Food stamp (SNAP) recipients
- Summer Youth Employees especially those living in empowerment zones
- Supplemental Security Income recipients
- Vocational rehabilitation referred individuals
- Qualified Long-Term Unemployment Recipient
There are several other business incentives that you can benefit from after you register a new business in New York. Such incentives include Excelsior Jobs Program, IDA Commercial Tax Incentives, IDA Industrial Incentive Programs, Industrial and Commercial Abatement Program (ICAP), Job Creation and Retention Program (JCRP), Lower Manhattan Sales and Use Tax Exemption, and New Markets Tax Credit (NMTC) Program among others.
Are there any Disadvantages of Incorporating in New York?
Are there any disadvantages for a startup company in New York? Disadvantages are few and the most important among them is the wide array of taxes. It simply means that there are too many types of taxes as well as fees that businesses might be subjected to. This makes it difficult for small businesses to manage their tax burden at times.
The wide array of taxes however challenging is more often than not neutralized by the variety of tax credit schemes on offer. At the end of the day, the advantages and benefits for businesses in New York far outweigh the disadvantages.