David J. Maines & Tami L. Maines v. Commissioner

OPINION

Holmes, Judge:

New York State uses extremely targeted tax credits as an incentive for extremely targeted economic development in extremely targeted locations. Those who receive these credits may be extremely benefited — even if they do not owe any state income tax, New York calls the credits overpayments of income tax and makes them refundable. David and Tami Maines say that none of the credits should be taxable because New York labels them “overpay-ments” of past state income tax, and they never claimed prior deductions for state income tax. The Commissioner disagrees and argues that…