Form IT-212: Investment Credit (2026)

Q: How much income can be excluded on IT-221?

You may exclude up to <b>$5,000 ($10,000 for joint filers)</b> of qualifying disability income, reduced by any NY pension or annuity exclusion previously claimed.

Q: Are HSA contributions deductible for New York tax?

No—unlike the federal system, New York does <b>not</b> allow an HSA deduction.

Last reviewed: 2025-10-29

Use the New York Tax Form Calculator Form IT-212 — Investment Credit as a stand alone tax form calculator to quickly calculate specific amounts for your 2026 New York state tax return. Alternatively, you can use one of our Combined Federal and State Tax Estimators to quickly calculate your salary, tax, and take-home pay.

Form IT-212 is used by individuals, estates/trusts, partners, or S-corporation shareholders to claim the New York State Investment Credit under Tax Law section 606(a). The credit applies to qualified property placed in service in New York, including manufacturing and production equipment, waste treatment and pollution control property, and certain retail enterprise property. Additional credits for historic barn rehabilitation or employment incentive property are claimed via the attachment IT-212-ATT.

If you placed qualified property in service this year, or are carrying forward unused credits from prior years, complete Form IT-212 and attach it to your return (IT-201, IT-203, IT-204, or IT-205 as applicable). Maintain documentation of the property’s New York location and its qualified use.

Who must file: Individuals, estates, trusts, partners in partnerships, and S-corporation shareholders claiming the investment credit, historic barn rehabilitation credit, or employment incentive credit under the IT-212 series.
Eligible property: Property must be placed in service in New York State; exclude automobiles and trucks used on public roads, property used for production/distribution of electricity or steam through mains, and property used outside NY. Property from retail enterprises may qualify if used in qualified rehabilitation.
Credit rate and carryforward: Under NY law, the investment credit rate for individuals, partners, or S-corporation shareholders is generally 4% of the qualified investment. Credit carryforward is allowed for unused certifiable credit — review your entity type for specific carry-forward periods.
Historic barn & employment incentive credits: To claim these special credits, complete Form IT-212-ATT with Form IT-212. Attach certificates where required (e.g., from NYS Parks for historic barns) and follow applicable rules for early dispositions and recapture.
Documentation: Retain a schedule of each item of qualified property: description, date placed in service, cost or adjusted basis, location in NY, NAICS code, and percentage of qualified use. If the property is disposed of or ceases qualified use early, recapture provisions may apply.

Tax Law – Article 22, Section 606(a)
Part 1 – Computation of credit (see Form IT-212-I, Instructions for Form IT-212)
Individual or fiduciary		1	Credit from line 25, column F						1
		2	Credit from line 25, column G						2
Beneficiary		3	Share of investment tax credit from the estate or trust.						3
		4	Share of research and development credit from the estate or trust						4
Partner			Partnership name:
			Employer identification number
		5	Partner’s share of credit shown on Form IT-204-IP, line 49						5
		6	Partner’s share of credit shown on Form IT-204-IP, line 50						6
S corporation shareholder			S corporation name:
			Employer identification number
		7	Shareholder’s share of investment credit from the S corporation (see instructions)						7
		8	Shareholder’s share of research and development credit from the S corporation (see instr.)						8
		9	Total (add lines 1 through 8)						9
10	Fiduciaries: Enter credit allocated to beneficiaries								10
11	Subtract line 10 from line 9								11
12	Available carryover credit from last year’s Form IT-212								12
13	Investment credit (add lines 11 and 12)								13
14	Total addback of credit from line 21 (fiduciaries: see instructions)								14
15a	Total investment credit (see instructions)								15a
15b	Net investment credit recapture (see instructions)								15b
Part 2 – Summary of addback of credit on early dispositions (see instructions)
16	Individual’s and partnership’s addback of credit on early dispositions (from line 31)								16
17	Beneficiary’s share of addback of credit on early dispositions								17
18	Partner’s share of addback of credit on early dispositions								18
19	S corporation shareholder’s share of addback of credit on early dispositions								19
20	Estate’s or trust’s addback of credits on early dispositions (from line 31)								20
21	Total (add lines 16 through 20)								21
Part 3 – Investments in qualified property (see instructions)
A – Description of property (list each asset and submit a schedule if needed)		B – Principal use of property		C – Date acquired		D - Useful life in years	E – Investment credit base	F – Investment credit for manufacturing and production, retail enterprise, waste treatment, and pollution control property (column E × % ())	G – Investment credit for research and development property (column E × % ())
22



23	Enter amount from Form IT-212-ATT, line 11							23
24	Enter amount from Form IT-212-ATT, line 19, column C							24
25	Total investment credit (add amounts in columns F and G) Individuals: Enter the line 25, column F amount on line 1. Enter the line 25, column G amount on line 2. Fiduciaries: Enter the line 25, column F amount on line 1 and on the Total line of Part 5, column C. Enter the line 25, column G amount on line 2 and on the Total line of Part 5, column D. Partnerships: See instructions.							25
Part 4 – Early dispositions of qualified property and addback of credit on early dispositions (see instructions)
A – Description of property (list each asset and submit a schedule if needed)		B – Date acquired		C – Date property ceased to qualify	D – Life (months)	E – Unused life (months)	F – Percentage (E ÷ D)	G – Total investment credit allowed (see instructions)	H – Addback of credit on early dispositions (F × G)
26



27	Enter amount from Form IT-212-ATT, line 12								27
28	Total (add lines 26 and 27, column H, and enter total here)								28
29	Interest rate								29
30	Multiply line 28 by line 29								30
31	Total addback of credit on early dispositions (add amounts on lines 28 and 30) Fiduciaries: Enter the line 31 amount on line 20. All others: Enter the line 31 amount on line 16.								31
Part 5 – Beneficiary’s and fiduciary’s share of investment credit and addback of credit on early dispositions
A – Beneficiary’s name (same as in Form IT-205, Schedule C)		B – Identifying number		C – Share of investment credit for manufacturing and production, retail enterprise, waste treatment, and pollution control property				D – Share of investment credit for research and development property	E – Share of addback of credit on early dispositions
Total



Fiduciary
Part 6 – Application of credit and computation of refund and carryover (see instructions)
32a	Total credit (from line 15a)								32a
32b	Tax due before credits								32b
33	Credits that you applied before this credit								33
34	Net tax (subtract line 33 from line 32b)								34
35	Amount of credit used for the current tax year								35
36	Amount of credit available for refund or carryover to next year (subtract line 35 from line 32a)								36
37	Amount of credit to be refunded								37
38	Amount of credit available for carryover to next year (subtract line 37 from line 36)								38
39	Unused expired tax credits (see instructions) Enter the earliest year (yyyy) of unused credit carryover included in the carryforward								39
40	Amount of credit to be carried over to next year (subtract line 39 from line 38)								40

Calculating the Investment Credit

Start by listing all qualified property placed in service or acquired during the tax year. Enter the total cost or adjusted basis of each item in NY. On IT-212, Part I collects credits from various categories (lines 1-9); line 9 includes total credits from lines 1-8a.

Part II addresses add-back of credit for early disposition of property. If you disposed of the qualified property, returned it to non-qualified use, or transferred it before the required holding period, compute the recapture amount and include it in the add-back section.

Carryforward: If your current-year tax liability is insufficient to use the full credit, the unused portion may be carried forward in accordance with entity type rules. Monitor your carry-forward balances each year and enter them on IT-212 as applicable.

Example: You place $500,000 of qualified manufacturing equipment in service in New York and are eligible at a 4% credit rate. Your credit is $20,000. If your NY tax liability this year is only $15,000, you claim $15,000 this year and carry forward $5,000 to future years.

Historic barn rehabilitation and employment incentive: If eligible, complete IT-212-ATT and include the result on IT-212 line 2 or the applicable line for those credits. For employment incentive credit, you must have increased net New York employees by at least 1% compared to the base period.

Last reviewed: 2025-10-29: If you believe this form requires an update, please contact us.

Planning & Audit-Defense Strategies

Maintain a permanent file for each qualified property item. Include invoices, proof of location in New York, depreciation schedules, service date records, and questionnaires substantiating qualified use. In audits, NY DTF will review the allocation of property to New York and the disqualification of public-road vehicles or non-qualified use.

Before year-end, review planned asset acquisitions and service-dates to maximize classification into NY-qualified property. If you anticipate minimal tax this year, consider whether waiting to place the asset(s) in service until your liability is higher improves utilization of the credit.

Track carryforward balances diligently in your tax-department ledger. Untimely or inaccurate carry-forward tracking is a frequent audit trigger. If you disposed of property that generated a credit, run the recapture–add-back computation and document it thoroughly.

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Frequently Asked Questions

Does IT-203-ATT replace IT-112-R or IT-112-C?

No. Those forms calculate credits for taxes paid to other jurisdictions, and their totals are then entered onto IT-203-ATT where indicated.

How much income can be excluded on IT-221?

You may exclude up to $5,000 ($10,000 for joint filers) of qualifying disability income, reduced by any NY pension or annuity exclusion previously claimed.

Can part-owners of a property claim IT-119?

Yes — if the notice issued reflects the property key and entity ownership, each owner must enter their share of the underpayment on IT-119 and may attach separate forms as required.

Can I use IT-203-B to claim the NY College Tuition Deduction?

Yes. Part 2 of IT-203-B calculates the allowable college tuition itemized deduction or credit, depending on your AGI and tuition amounts paid.

Are HSA contributions deductible for New York tax?

No—unlike the federal system, New York does not allow an HSA deduction.

Important Notes

All calculations are estimates for guidance only. Always review your return and consider professional advice when submitting official filings.