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September 29, 2020
2020-2345

New Jersey extends Corporation Business Tax surcharge through 2023

On September 29, 2020, New Jersey Governor Phil Murphy signed into law A. 4721, extending through December 31, 2023, the 2.5% surtax currently imposed on Corporation Business Tax (CBT) filers with allocated taxable net income over $1 million. As originally enacted, the surtax rate was scheduled to decrease from 2.5% to 1.5% for privilege periods (i.e., tax years) beginning on or after January 1, 2020 through December 31, 2021, and expire for privilege periods beginning on or after January 1, 2022.1 The change made by A. 4721 takes effect immediately and applies retroactively to privilege periods beginning on or after January 1, 2020.

The law also directs the New Jersey Director of the Division of Taxation to waive penalties and interest incurred by a taxpayer due to the retroactive application of the increased surtax.

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Contact Information
For additional information concerning this Alert, please contact:
 
State and Local Taxation Group
   • Bill Korman (william.korman@ey.com)
   • Michael Puzyk (michael.puzyk@ey.com)

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ENDNOTES

1 N.J.S.A. Section 54:10A-5.

 

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