Bill Text: NJ S3217 | 2024-2025 | Regular Session | Introduced
Bill Title: Provides tax credits equal to cost of Jersey Fresh products purchased by breweries and wineries to be used in production of beer or wine.
Spectrum: Bipartisan Bill
Status: (Introduced) 2024-05-13 - Introduced in the Senate, Referred to Senate Economic Growth Committee [S3217 Detail]
Download: New_Jersey-2024-S3217-Introduced.html
Sponsored by:
Senator MICHAEL L. TESTA, JR.
District 1 (Atlantic, Cape May and Cumberland)
Senator NILSA I. CRUZ-PEREZ
District 5 (Camden and Gloucester)
SYNOPSIS
Provides tax credits equal to cost of Jersey Fresh products purchased by breweries and wineries to be used in production of beer or wine.
CURRENT VERSION OF TEXT
As introduced.
An Act providing tax credits for certain purchases of Jersey Fresh products by owners and operators of breweries and wineries, supplementing P.L.1945, c.162 (C.54:10A-1 et seq.) and 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 owns or operates a brewery or winery in the State shall be allowed a credit against the corporation business tax imposed pursuant to section 5 of P.L.1945, c.162 (C.54:10A-5) in an amount equal to the amount paid during the privilege period to purchase commodities from a Jersey Fresh Quality Grading Program licensee to be used in the production of beer or wine. The value of the credits allowed pursuant to this section shall not exceed $10,000.
b. To qualify for the tax credit allowed pursuant to subsection a. of this section, the taxpayer shall attach receipts for sales of the commodities purchased by the taxpayer during the privilege period, documentation from the Department of Agriculture verifying that the commodities were purchased from a Jersey Fresh Quality Grading Program licensee, and a signed affidavit stating that the commodities were purchased to be used in the production of beer or wine.
c. The order of priority of the application of the credits allowed pursuant to this section and any other credits allowed by law shall be as prescribed by the director. The amount of the credits applied under this section against the corporation business tax liability of the taxpayer for a privilege period, together with any other credits allowed by law, shall not exceed 50 percent of the tax liability otherwise due and shall not reduce the tax liability 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 allowable under this section which cannot be used to reduce the taxpayer's corporation business tax liability for the privilege period due to the limitations of this section may be carried forward and applied to the earliest available use within the 20 privilege periods immediately following the privilege period for which the credits are allowed.
d. As used in this section:
"brewery" means a brewery operating under a brewery license pursuant to R.S.33:1-10.
"Jersey Fresh Quality Grading Program licensee" means any entity that has applied for and been granted approval by the Department of Agriculture to package commodities using a department-approved "Jersey Fresh" logo.
"winery" means a commercial farm where the owner or operator of the commercial farm has been issued and is operating in compliance with a plenary winery license or farm winery license pursuant to R.S.33:1-10.
2. a. A taxpayer that owns or operates a brewery or winery in the State shall be allowed a credit against the tax otherwise due under the "New Jersey Gross Income Tax Act," N.J.S.54A:1-1 et seq., in an amount equal to the amount paid during the taxable year to purchase commodities from a Jersey Fresh Quality Grading Program licensee to be used in the production of beer or wine. The value of the credits allowed pursuant to this section shall not exceed $10,000.
b. To qualify for the tax credit allowed pursuant to subsection a. of this section, the taxpayer shall attach receipts for sales of the commodities purchased by the taxpayer during the taxable year, documentation from the Department of Agriculture verifying that the commodities were purchased from a Jersey Fresh Quality Grading Program licensee, and a signed affidavit stating that the commodities were purchased for use in the production of beer or wine.
c. The order of priority of the application of the credit allowed pursuant to this section, and any other credits allowed against the tax imposed pursuant to N.J.S.54A:1-1 et seq. for a taxable year, shall be as prescribed by the director. The amount of the credit applied under this section against the New Jersey gross income tax imposed pursuant to N.J.S.54A:1-1 et seq. for a taxable year, when taken together with any other payments, credits, deductions, and adjustments allowed by law, shall not reduce a taxpayer's tax liability to an amount less than zero. The amount of the tax credit otherwise allowable under this section which cannot be applied for the taxable year due to the limitations of this section or other provisions of N.J.S.54A:1-1 et seq. may be carried forward, if necessary, to the five taxable years following the taxable year for which the tax credit was allowed.
d. (1) A business entity that is classified as a partnership for federal income tax purposes shall not be allowed a credit under this section directly, but the amount of credit of a taxpayer in respect of a distributive share of partnership income under the "New Jersey Gross Income Tax Act," N.J.S.54A:1-1 et seq., 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 New Jersey S Corporation shall not be allowed a credit under this section directly, but the amount of the tax 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 tax 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.
e. As used in this section:
"brewery" means a brewery operating under a brewery license pursuant to R.S.33:1-10.
"Jersey Fresh Quality Grading Program licensee" means any entity that has applied for and been granted approval by the Department of Agriculture to package commodities using a department-approved "Jersey Fresh" logo.
"winery" means a commercial farm where the owner or operator of the commercial farm has been issued and is operating in compliance with a plenary winery license or farm winery license pursuant to R.S.33:1-10.
3. The Director of the Division of Taxation in the Department of the Treasury shall adopt rules and regulations pursuant to the "Administrative Procedure Act," P.L.1968, c.410 (C.52:14B-1 et seq.) as the director may deem necessary to effectuate sections 1 and 2 of this act.
4. This act shall take effect immediately and shall apply to taxable years beginning on or after January 1 following enactment.
STATEMENT
This bill provides tax credits to the owners and operators of breweries and wineries for purchases of Jersey Fresh products. The amount of the credit would be equal to the amount paid to purchase commodities from a Jersey Fresh Quality Grading Program licensee to be used in the production of beer or wine. The value of the credits allowed under the bill would not exceed $10,000. To qualify for the credit, a taxpayer would be required to attach receipts for sales of the commodities purchased by the taxpayer during the tax year or tax period, documentation from the Department of Agriculture verifying that the commodities were purchased from a Jersey Fresh Quality Grading Program licensee, and a signed affidavit stating that the commodities were purchased for business use.
