New Jersey

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In a recent unpublished decision, Residuary Trust A v. Director, Division of Taxation (Kassner), the New Jersey Appellate Division relied on the “square corners doctrine” to hold that the New Jersey Division of Taxation was prohibited from imposing tax for the 2006 tax year based on a policy change not announced until 2011. In…

By Nicole Boutros and Amy Nogid

The New Jersey Tax Court ruled that the Division of Taxation (“Division”) properly required a foreign (non-New Jersey domesticated) corporation to file corporation business tax (“CBT”) returns reporting licensing revenue from its parent attributable to New Jersey, based on New Jersey’s economic presence nexus standard, despite the parent’s royalty…

By Robert P. Merten III and Prentiss Willson

The New Jersey Division of Taxation has issued a technical advisory memorandum (TAM) explaining New Jersey’s tax position that transactions involving convertible virtual currency— “electronic/digital money” with an equivalent or substitute value in real currency, such as bitcoins—are subject to state tax liability, including sales and use…

New Jersey law contains a little-known, one-sentence provision with substantial implications for companies contesting corporate tax assessments in the New Jersey Tax Court: Filing a Tax Court complaint for one tax year causes the statute of limitations period for assessing additional tax for all subsequent open years to remain open—with no defined closing date—for any…

In New Jersey, Governor Christie conditionally vetoed AB939/S1403. The bill, as written, would modify tax expenditure reports produced by the Department of the Treasury during the annual budget process. “Tax expenditures” includes credits such as the film tax credit. Further, the legislation would require additional reports regarding tax expenditures associated with development subsidies primarily…

On October 2, in PPL Electric Utilities Corporation v. Director, Division of Taxation, No. 000005-2011, the New Jersey Tax Court determined that federal deductions for the taxpayer’s payments of Pennsylvania gross receipts tax and Pennsylvania capital stock tax are not subject to addback in New Jersey. As a result, taxpayers that added back those…