Bill Text: NJ A322 | 2024-2025 | Regular Session | Introduced
Bill Title: Allows corporation business tax credit for subcontracting work to NJ small businesses.
Spectrum: Partisan Bill (Republican 3-0)
Status: (Introduced) 2024-01-09 - Introduced, Referred to Assembly Commerce, Economic Development and Agriculture Committee [A322 Detail]
Download: New_Jersey-2024-A322-Introduced.html
STATE OF NEW JERSEY
221st LEGISLATURE
PRE-FILED FOR INTRODUCTION IN THE 2024 SESSION
Sponsored by:
Assemblywoman MICHELE MATSIKOUDIS
District 21 (Morris, Somerset and Union)
SYNOPSIS
Allows corporation business tax credit for subcontracting work to NJ small businesses.
CURRENT VERSION OF TEXT
Introduced Pending Technical Review by Legislative Counsel.
An Act allowing a corporation business tax credit for subcontracting work to NJ small businesses, supplementing P.L.1945, c.162 (C.54:10A-1 et seq.).
Be It Enacted by the Senate and General Assembly of the State of New Jersey:
1. a. A taxpayer shall be allowed a credit against the imposed pursuant to section 5 of P.L.1945, c.162 (C.54:10A-5) in an amount equal to one percent of the amount the taxpayer paid to a New Jersey small business for subcontracted work performed in New Jersey during the privilege period.
As used in this section:
"New Jersey small business" means a business entity or person located in New Jersey, with fewer than 50 total employees. A "New Jersey small business" shall not include any business entity or person that is an affiliate, subsidiary, or under the control of the taxpayer.
"Subcontracted work" means the work that the taxpayer subcontracts to a New Jersey small business for performance of all or an element of the taxpayer's own contracted duties.
b. The director shall prescribe the order of priority of the application of the credit allowed pursuant to this section and any other credits allowed against the tax imposed pursuant to section 5 of P.L.1945, c.162 (C.54:10A-5). The amount of the credit allowed pursuant to this section, when taken together with any other credits allowed, shall not exceed 50 percent of the tax liability otherwise due and shall not reduce the tax liability to an amount less than the statutory minimum provided in subsection (e) of section 5 of P.L.1945, c.162 (C.54:10A-5).
c. The director shall promulgate procedures by which a taxpayer may certify that the taxpayer qualifies for the credit allowed pursuant to this section.
2. This act shall take effect immediately and apply to privilege periods beginning after enactment.
STATEMENT
This bill allows taxpayers subject to the corporation business tax to claim a credit against that tax equal to one percent of the amount the taxpayer paid to New Jersey small businesses for subcontracted work.
For purposes of the credit, subcontracted work is that work which the taxpayer subcontracts to New Jersey small businesses for performance of all or an element of the taxpayer's own contracted duties. In addition, the subcontracted work must be performed in New Jersey and the subcontractor must have less than 50 employees.
