Why do the largest global companies choose New York as their headquarters?
There are several significant reasons why there has been a surge in the number of businesses registered in the state.
New York is considered one of the most business-friendly places not only in the United States but also in the world. Regardless of what form of business you plan to set up, it is a place from which you can easily reach both domestic and global markets.
The good news is that if you are preparing to register a new company in New York, you may qualify for special incentive programs that are offered by the state. These programs are sure to bring long-term benefits to your LLC or corporation.
Advantages of New York State that new businesses can take advantage of
When we talk about the potential benefits for a start-up company that is registered in New York, there are many tax advantages, credibility factor and recently the most discussed “state incentives”. Here are some benefits:
Benefit number 1: Tax benefits
While New York City is not widely known as the most business-friendly tax environment in the United States, it makes up for it by offering several types of tax breaks, as well as incentives for registering a new company in New York City. This significantly reduces the overall tax burden on enterprises. One of the most trusted and popular tax credit programs in New York is "Startup New York". As part of the program, selected companies (that meet certain criteria) can enjoy a 10-year tax exemption in the location specified in the program regulations, which is to encourage more start-ups to choose New York as their headquarters.
Benefit #2: Federal Work Opportunity Tax Credit (WOTC)
This is a type of federal tax credit that will generally be available to your company once it is registered in New York. This type of tax credit is offered if your business employs people or workers from those groups of job seekers who consistently face significant obstacles when it comes to employment. The maximum amount of the tax credit mentioned above can range from $1,200 to $9,600, and this amount varies depending on the type of employee your company hires. The target group includes:
- Qualified unemployed veterans, including those with disabilities
- Persons who have been convicted in the past by a criminal sentence
- Temporary Assistance for Needy Families (TANF).
- Selected community residents, especially those living in rural areas
- Individuals who are Food Stamp (SNAP) recipients.
- Summer Youth Employees, especially those living in empowerment zones
- Supplemental Security Income recipients
- People who have been referred for vocational rehabilitation
- Qualified Long Term Unemployment Receiver
Additionally, New York offers several other business incentives that you can take advantage of when you register a new company in the state. These incentives include the Excelsior Jobs Program, IDA Industrial Incentive Programs, IDA Commercial Tax Incentives, , Industrial and Commercial Abatement Program (ICAP), Job Creation and Retention Program (JCRP), New Markets Tax Credit (NMTC) and Lower Manhattan Sales and Use Tax Credit Program.
Potential Disadvantages of Starting a Business in New York City
Considering the issue of possible disadvantages in terms of choosing New York as the place of registration of the company, it must be said that there are relatively few such disadvantages. The most important obstacle in choosing New York is the wide range of taxes, which can cause difficulties in interpretation. It simply means that there are a great many types of taxes and levies that businesses incorporated in the state may be subject to. This sometimes makes it difficult for small businesses to manage their tax burden.
The wide variety of taxes, while challenging, is often counterbalanced by the large number of tax relief programs on offer. Ultimately, analyzing all the advantages and potential disadvantages for registering a company in New York, it must be said that the advantages far outweigh the few disadvantages.
