SENATE, No. 4095 STATE OF NEW JERSEY 221st LEGISLATURE INTRODUCED FEBRUARY 3, 2025
SENATE, No. 4095
STATE OF NEW JERSEY
221st LEGISLATURE
INTRODUCED FEBRUARY 3, 2025
Sponsored by: Senator CARMEN F. AMATO, JR. District 9 (Ocean) SYNOPSIS Provides corporation business and gross income tax credits for acquisition of qualified farming equipment. CURRENT VERSION OF TEXT As introduced.
Sponsored by:
Senator CARMEN F. AMATO, JR.
District 9 (Ocean)
SYNOPSIS
Provides corporation business and gross income tax credits for acquisition of qualified farming equipment.
CURRENT VERSION OF TEXT
As introduced.
An Act providing a tax credit for the acquisition of certain farming equipment and supplementing P.L.1945, c.162 (C.54:10A-1 et seq.) and chapter 4 of Title 54A of the New Jersey Statutes. Be It Enacted by the Senate and General Assembly of the State of New Jersey: 1. a. A taxpayer that is engaged in an eligible farming operation shall be allowed a credit against the tax imposed pursuant to section 5 of P.L.1945, c.162 (C.54:10A-5) in an amount equal to 10 percent of the amount paid by the taxpayer during the privilege period for the acquisition of qualified farming equipment. b. A credit shall not be allowed under this section for any expense for which a credit is claimed pursuant to P.L.1993, c.170 (C.54:10A-5.4 et seq.), P.L.1993, c.171 (C.54:10A-5.16 et al.), P.L.1993, c.175 (54:10A-5.24), or P.L.2001, c.321 (C.54:10A-5.31 et seq.). c. (1) In order to claim the credit allowed pursuant to this section, a taxpayer shall apply to the Secretary of Agriculture for certification that the taxpayer: (a) is engaged in an eligible farming operation; and (b) has acquired qualified farming equipment during the privilege period. The secretary shall establish an application process and prescribe the form and manner through which a taxpayer may submit an application for certification. (2) The secretary shall review each application for certification submitted by a taxpayer in accordance with this section and make a determination regarding the approval of an application for certification within 90 calendar days of the date a complete application is received. The secretary shall issue a written certification to each taxpayer whose application has been reviewed and approved by the secretary in accordance with this section within five calendar days of the date the secretary's determination is made. A copy of the certification shall be included in the filing of a return that includes a claim for the credit. (3) If the secretary fails to make a determination regarding an application submitted pursuant to this subsection within 90 calendar days of the date the application is received, or if the secretary fails to issue a written certification within five calendar days of the date a determination is made, the application shall be deemed to have been approved and the written certification shall be deemed to have been issued by the secretary. Each taxpayer that submitted an application in accordance with this subsection but fails to receive a determination from the secretary within 90 calendar days of the date the application is submitted, or fails to receive a written certification from the secretary within five calendar days of the date of the secretary's determination is made, shall include a copy of the taxpayer's application when filing a return that includes a claim for the credit allowed in accordance with subsection a. of this section. d. The order of priority of the application of the credit allowed under this section and any other credits allowed by law shall be as prescribed by the Director of the Division of Taxation. The amount of credits applied under this section against the tax imposed pursuant to section 5 of P.L.1945, c.162 (C.54:10A-5) for a privilege period, together with any other payments, credits, deductions, and adjustments allowed by law, shall not exceed 25 percent of the tax liability otherwise due and shall not reduce the tax liability for a privilege period 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). The amount of the credit otherwise allowable under this section which cannot be applied for the privilege period due to the limitations of this subsection or under other provisions of P.L.1945, c.162 (C.54:10A-1 et seq.) may be carried forward, if necessary, to the seven privilege periods following the privilege period for which the credit is allowed. e. As used in this section: "Eligible farming operation" means any activity connected to the commercial growing, harvesting, processing, producing, or raising of agricultural products in the State, including crops, dairy animals, livestock, fur-bearing animals, poultry, bees, crops used in fermented alcoholic beverages and wine, and any products therefrom, including organic agricultural products, aquacultural products, horticultural products, and silviculture products. "Qualified farming equipment" means any equipment that is used directly for an eligible farming operation. "Secretary of Agriculture" or "secretary" mean the Secretary of the Department of Agriculture. 2. a. A taxpayer that is engaged in an eligible farming operation shall be allowed a credit against the tax imposed pursuant to the "New Jersey Gross Income Tax Act," N.J.S.54A:1-1 et seq., in an amount equal to 10 percent of the amount paid by the taxpayer during the taxable year for the acquisition of qualified farming equipment. b. (1) In order to claim the credit allowed pursuant to this section, a taxpayer shall apply to the Secretary of Agriculture for certification that the taxpayer: (a) is engaged in an eligible farming operation; and (b) has acquired qualified farming equipment during the taxable year. The department shall establish an application process and prescribe the form and manner through which a taxpayer may submit an application for certification. (2) The secretary shall review each application for certification submitted by a taxpayer in accordance with this section and make a determination regarding the approval of an application for certification within 90 calendar days of the date a complete application is received. The secretary shall issue a written certification to each taxpayer whose application has been reviewed and approved by the secretary in accordance with this section within five calendar days of the date the secretary's determination is made. A copy of the certification shall be included in the filing of a return that includes a claim for the credit. (3) If the secretary fails to make a determination regarding an application submitted pursuant to this subsection within 90 calendar days of the date the application is received, or if the secretary fails to issue a written certification within five calendar days of the date a determination is made, the application shall be deemed to have been approved and the written certification shall be deemed to have been issued by the secretary. Each taxpayer that submitted an application in accordance with this subsection but fails to receive a determination from the secretary within 90 calendar days of the date the application is submitted, or fails to receive a written certification from the secretary within five calendar days of the date of the secretary's determination is made, shall include a copy of the taxpayer's application when filing a return that includes a claim for the credit allowed in accordance with subsection a. of this section. c. (1) A business entity that is classified as a partnership for federal income tax purposes shall not be allowed the credit directly under the gross income tax, but the amount of credit of the taxpayer in respect of a distributive share of partnership income shall be determined by allocating to the taxpayer that proportion of the credit acquired by the partnership that is equal to the taxpayer's share, whether or not distributed, of the total distributive income or gain of the partnership for its taxable year ending within or with the taxpayer's taxable year. (2) A taxpayer that is a New Jersey S corporation shall not be allowed the credit directly under the gross income tax, but the amount of credit of a taxpayer in respect of a pro rata share of S corporation income shall be determined by allocating to the taxpayer that proportion of the credit acquired by the New Jersey S corporation that is equal to the taxpayer's share, whether or not distributed, of the total pro rata share of S corporation income of the New Jersey S corporation for its privilege period ending within or with the taxpayer's taxable year. d. The order of priority of the application of the credit allowed under this section and any other credits allowed by law shall be as prescribed by the secretary. The amount of a tax credit allowed pursuant to this section shall not exceed 25 percent of the amount of tax otherwise due for the taxable year under the "New Jersey Gross Income Tax Act," N.J.S.54A:1-1 et seq. The amount of a tax credit allowed pursuant to this section, together with any payments, credits, deductions, and adjustments allowed by law, shall not reduce the amount of tax otherwise due for the taxable year under the "New Jersey Gross Income Tax Act," N.J.S.54A:1-1 et seq. to an amount less than zero. The amount of credit otherwise allowable under this section which cannot be applied for the taxable year due to the limitations of this subsection may be carried forward, if necessary, to the seven taxable years following the taxable year for which the credit is allowed. e. As used in this section: "Eligible farming operation" means any activity connected to the commercial growing, harvesting, processing, producing, or raising of agricultural products in the State, including crops, dairy animals, livestock, fur-bearing animals, poultry, bees, crops used in fermented alcoholic beverages and wine, and any products therefrom, including organic agricultural products, aquacultural products, horticultural products, and silviculture products. "Qualified farming equipment" means any equipment that is used directly for an eligible farming operation. "Secretary of Agriculture" and "secretary" mean the Secretary of the Department of Agriculture. 3. The Secretary of Agriculture, in consultation with the Director of the Division of Taxation in the Department of the Treasury, shall adopt rules and regulations in accordance with the "Administrative Procedure Act," P.L.1968, c.410 (C.52:14B-1 et seq.) as necessary to implement the provisions of this act. 4. This act shall take effect immediately and shall apply to privilege periods and taxable years beginning on or after January 1 of the year next following the date of enactment. STATEMENT This bill provides corporation business and gross income tax credits to taxpayers that acquire qualified farming equipment used directly for an eligible farming operation. Specifically, the credits would be for 10 percent of the amount paid during the privilege period or taxable year for the acquisition of farming equipment, but not to exceed 25 percent of the taxpayer's tax liability. In order to claim the credit provided under the bill, a taxpayer would be required to submit an application to the Secretary of Agriculture for certification that the taxpayer is engaged in an eligible farming operation and has acquired qualified farming equipment during the privilege period or taxable year. A copy of the certification would be required to be included with the taxpayer's tax return when such return is filed. The Secretary of Agriculture would be required to establish a process by which applications for certification may be submitted. The bill defines "qualified farming equipment" as any equipment that is used directly for an eligible farming operation and "eligible farming operation" as any activity connected to the commercial growing, harvesting, processing, producing, or raising of agricultural products in the State including crops, dairy animals, livestock, fur-bearing animals, poultry, bees, crops used in fermented alcoholic beverages and wine, and any products therefrom, including organic agricultural products, aquacultural products, horticultural products, and silviculture products.
An Act providing a tax credit for the acquisition of certain farming equipment and supplementing P.L.1945, c.162 (C.54:10A-1 et seq.) and chapter 4 of Title 54A of the New Jersey Statutes.
Be It Enacted by the Senate and General Assembly of the State of New Jersey:
1. a. A taxpayer that is engaged in an eligible farming operation shall be allowed a credit against the tax imposed pursuant to section 5 of P.L.1945, c.162 (C.54:10A-5) in an amount equal to 10 percent of the amount paid by the taxpayer during the privilege period for the acquisition of qualified farming equipment.
b. A credit shall not be allowed under this section for any expense for which a credit is claimed pursuant to P.L.1993, c.170 (C.54:10A-5.4 et seq.), P.L.1993, c.171 (C.54:10A-5.16 et al.), P.L.1993, c.175 (54:10A-5.24), or P.L.2001, c.321 (C.54:10A-5.31 et seq.).
c. (1) In order to claim the credit allowed pursuant to this section, a taxpayer shall apply to the Secretary of Agriculture for certification that the taxpayer: (a) is engaged in an eligible farming operation; and (b) has acquired qualified farming equipment during the privilege period. The secretary shall establish an application process and prescribe the form and manner through which a taxpayer may submit an application for certification.
(2) The secretary shall review each application for certification submitted by a taxpayer in accordance with this section and make a determination regarding the approval of an application for certification within 90 calendar days of the date a complete application is received. The secretary shall issue a written certification to each taxpayer whose application has been reviewed and approved by the secretary in accordance with this section within five calendar days of the date the secretary's determination is made. A copy of the certification shall be included in the filing of a return that includes a claim for the credit.
(3) If the secretary fails to make a determination regarding an application submitted pursuant to this subsection within 90 calendar days of the date the application is received, or if the secretary fails to issue a written certification within five calendar days of the date a determination is made, the application shall be deemed to have been approved and the written certification shall be deemed to have been issued by the secretary. Each taxpayer that submitted an application in accordance with this subsection but fails to receive a determination from the secretary within 90 calendar days of the date the application is submitted, or fails to receive a written certification from the secretary within five calendar days of the date of the secretary's determination is made, shall include a copy of the taxpayer's application when filing a return that includes a claim for the credit allowed in accordance with subsection a. of this section.
d. The order of priority of the application of the credit allowed under this section and any other credits allowed by law shall be as prescribed by the Director of the Division of Taxation. The amount of credits applied under this section against the tax imposed pursuant to section 5 of P.L.1945, c.162 (C.54:10A-5) for a privilege period, together with any other payments, credits, deductions, and adjustments allowed by law, shall not exceed 25 percent of the tax liability otherwise due and shall not reduce the tax liability for a privilege period 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). The amount of the credit otherwise allowable under this section which cannot be applied for the privilege period due to the limitations of this subsection or under other provisions of P.L.1945, c.162 (C.54:10A-1 et seq.) may be carried forward, if necessary, to the seven privilege periods following the privilege period for which the credit is allowed.
e. As used in this section:
"Eligible farming operation" means any activity connected to the commercial growing, harvesting, processing, producing, or raising of agricultural products in the State, including crops, dairy animals, livestock, fur-bearing animals, poultry, bees, crops used in fermented alcoholic beverages and wine, and any products therefrom, including organic agricultural products, aquacultural products, horticultural products, and silviculture products.
"Qualified farming equipment" means any equipment that is used directly for an eligible farming operation.
"Secretary of Agriculture" or "secretary" mean the Secretary of the Department of Agriculture.
2. a. A taxpayer that is engaged in an eligible farming operation shall be allowed a credit against the tax imposed pursuant to the "New Jersey Gross Income Tax Act," N.J.S.54A:1-1 et seq., in an amount equal to 10 percent of the amount paid by the taxpayer during the taxable year for the acquisition of qualified farming equipment.
b. (1) In order to claim the credit allowed pursuant to this section, a taxpayer shall apply to the Secretary of Agriculture for certification that the taxpayer: (a) is engaged in an eligible farming operation; and (b) has acquired qualified farming equipment during the taxable year. The department shall establish an application process and prescribe the form and manner through which a taxpayer may submit an application for certification.
(2) The secretary shall review each application for certification submitted by a taxpayer in accordance with this section and make a determination regarding the approval of an application for certification within 90 calendar days of the date a complete application is received. The secretary shall issue a written certification to each taxpayer whose application has been reviewed and approved by the secretary in accordance with this section within five calendar days of the date the secretary's determination is made. A copy of the certification shall be included in the filing of a return that includes a claim for the credit.
(3) If the secretary fails to make a determination regarding an application submitted pursuant to this subsection within 90 calendar days of the date the application is received, or if the secretary fails to issue a written certification within five calendar days of the date a determination is made, the application shall be deemed to have been approved and the written certification shall be deemed to have been issued by the secretary. Each taxpayer that submitted an application in accordance with this subsection but fails to receive a determination from the secretary within 90 calendar days of the date the application is submitted, or fails to receive a written certification from the secretary within five calendar days of the date of the secretary's determination is made, shall include a copy of the taxpayer's application when filing a return that includes a claim for the credit allowed in accordance with subsection a. of this section.
c. (1) A business entity that is classified as a partnership for federal income tax purposes shall not be allowed the credit directly under the gross income tax, but the amount of credit of the taxpayer in respect of a distributive share of partnership income shall be determined by allocating to the taxpayer that proportion of the credit acquired by the partnership that is equal to the taxpayer's share, whether or not distributed, of the total distributive income or gain of the partnership for its taxable year ending within or with the taxpayer's taxable year.
(2) A taxpayer that is a New Jersey S corporation shall not be allowed the credit directly under the gross income tax, but the amount of credit of a taxpayer in respect of a pro rata share of S corporation income shall be determined by allocating to the taxpayer that proportion of the credit acquired by the New Jersey S corporation that is equal to the taxpayer's share, whether or not distributed, of the total pro rata share of S corporation income of the New Jersey S corporation for its privilege period ending within or with the taxpayer's taxable year.
d. The order of priority of the application of the credit allowed under this section and any other credits allowed by law shall be as prescribed by the secretary. The amount of a tax credit allowed pursuant to this section shall not exceed 25 percent of the amount of tax otherwise due for the taxable year under the "New Jersey Gross Income Tax Act," N.J.S.54A:1-1 et seq. The amount of a tax credit allowed pursuant to this section, together with any payments, credits, deductions, and adjustments allowed by law, shall not reduce the amount of tax otherwise due for the taxable year under the "New Jersey Gross Income Tax Act," N.J.S.54A:1-1 et seq. to an amount less than zero. The amount of credit otherwise allowable under this section which cannot be applied for the taxable year due to the limitations of this subsection may be carried forward, if necessary, to the seven taxable years following the taxable year for which the credit is allowed.
e. As used in this section:
"Eligible farming operation" means any activity connected to the commercial growing, harvesting, processing, producing, or raising of agricultural products in the State, including crops, dairy animals, livestock, fur-bearing animals, poultry, bees, crops used in fermented alcoholic beverages and wine, and any products therefrom, including organic agricultural products, aquacultural products, horticultural products, and silviculture products.
"Qualified farming equipment" means any equipment that is used directly for an eligible farming operation.
"Secretary of Agriculture" and "secretary" mean the Secretary of the Department of Agriculture.
3. The Secretary of Agriculture, in consultation with the Director of the Division of Taxation in the Department of the Treasury, shall adopt rules and regulations in accordance with the "Administrative Procedure Act," P.L.1968, c.410 (C.52:14B-1 et seq.) as necessary to implement the provisions of this act.
4. This act shall take effect immediately and shall apply to privilege periods and taxable years beginning on or after January 1 of the year next following the date of enactment.
STATEMENT
This bill provides corporation business and gross income tax credits to taxpayers that acquire qualified farming equipment used directly for an eligible farming operation. Specifically, the credits would be for 10 percent of the amount paid during the privilege period or taxable year for the acquisition of farming equipment, but not to exceed 25 percent of the taxpayer's tax liability.
In order to claim the credit provided under the bill, a taxpayer would be required to submit an application to the Secretary of Agriculture for certification that the taxpayer is engaged in an eligible farming operation and has acquired qualified farming equipment during the privilege period or taxable year. A copy of the certification would be required to be included with the taxpayer's tax return when such return is filed. The Secretary of Agriculture would be required to establish a process by which applications for certification may be submitted.
The bill defines "qualified farming equipment" as any equipment that is used directly for an eligible farming operation and "eligible farming operation" as any activity connected to the commercial growing, harvesting, processing, producing, or raising of agricultural products in the State including crops, dairy animals, livestock, fur-bearing animals, poultry, bees, crops used in fermented alcoholic beverages and wine, and any products therefrom, including organic agricultural products, aquacultural products, horticultural products, and silviculture products.