What business taxes apply to New Jersey corporations?
Update 2018: The budget agreement included a four-year increase in the Corporation Business Tax for businesses with net income over $1 million. They'll pay an additional 2.5 percent for two years and then 1.5 percent for two years before the rate returns to 9 percent.
The tax rate is 9% based upon entire net income, or the portion of entire net income allocated to New Jersey. Taxes for multistate corporations are apportioned using a weighted three-factor formula of sales, property and payroll. In New Jersey, this apportionment is weighted at 50:25:25. New Jersey allows corporation to carry forward losses from prior years. New Jersey has research and development credits capped at 50 percent of tax liability. For tax years beginning in calendar year 2002 and thereafter, the minimum Corporation Business Tax is $500 or $2,000 for all members of a controlled or affiliated group of corporations if the aggregate annual payroll for all corporations is $5 million or more.
• For New Jersey gross receipts of less than $100,000, the minimum tax is $500.
• For New Jersey gross receipts equal to or greater than $100,000, but less than $250,000, the minimum tax is $750.
• For New Jersey gross receipts equal to or greater than $250,000, but less than $500,000, the minimum tax is $1,000.
• For New Jersey gross receipts equal to or greater than $500,000, but less than $1,000,000, the minimum tax is $1,500.
• For New Jersey gross receipts equal to or greater than $1,000,000, the minimum tax is $2,000.
New Jersey’s combined rate of tax on gasoline of 27.4 cents per gallon (less than half that of Pennsylvania’s rate of 58 cents per gallon.)