New Jersey Assembly Bill A2699

New Jersey 2022-2023 Regular Session

• Introduced: 2/14/22
• Refer: 2/14/22

Caption

Requires submittal of Internal Revenue Service Form 1099-K with New Jersey corporation business tax and gross income tax returns.

Impact

The impact of A2699 on state laws centers on amending existing tax reporting requirements. Specifically, it modifies the New Jersey Gross Income Tax Act and the state’s corporation business tax statutes to include explicit requirements for the submission of IRS Form 1099-K. This legislative change is intended not only to streamline the reporting process for taxpayers but also to provide the Division of Taxation with better tools to verify income during audits. By integrating federal reporting standards into state tax returns, the bill aims to reduce discrepancies and challenges faced by auditors when determining compliance.

Summary

Assembly Bill A2699 aims to improve tax compliance and enforcement in New Jersey by requiring taxpayers to submit a copy of the Internal Revenue Service Form 1099-K with their corporation business tax and gross income tax returns. This form is used by payment settlement entities to report payment transactions, particularly those exceeding $20,000 and comprising more than 200 transactions. The bill's primary intention is to enhance the accuracy of reported income and bolster the state's tax enforcement efforts. By ensuring that taxpayers include the 1099-K form, officials hope to make it harder for individuals to underreport income, thereby increasing overall tax compliance.

Contention

Notable points of contention regarding A2699 may revolve around the burden it places on small businesses and individual taxpayers. Some critics may argue that requiring additional documentation complicates the tax filing process and could disproportionately affect those with less resources or understanding of tax obligations. Supporters, however, would likely contend that the requirement is a necessary measure to curb tax evasion and ensure fair taxation practices across New Jersey.