Bill Text: NJ S4305 | 2026-2027 | Regular Session | Introduced
Bill Title: Increases grant limit for reassignment of employees to State in certain cases; requires publication of guidance and authorizes State intervention for income tax refund claims filed outside State.
Sponsorship: Partisan Bill (Republican 1)
Status: (Introduced) 2026-05-18 - Introduced in the Senate, Referred to Senate Economic Growth Committee [S4305 Detail]
Download: New_Jersey-2026-S4305-Introduced.html
Sponsored by:
Senator DECLAN J. O'SCANLON, JR.
District 13 (Monmouth)
SYNOPSIS
Increases grant limits for reassignment of employees to State in certain cases; requires publication of guidance and authorizes State intervention for income tax refund claims filed outside State.
CURRENT VERSION OF TEXT
As introduced.
An Act concerning the provision of incentives and assistance related to the reassignment and tax refunding of resident taxpayers subject to income taxation by other jurisdictions and amending P.L.2023, c.125.
Be It Enacted by the Senate and General Assembly of the State of New Jersey:
1. Section 4 of P.L.2023, c.125 (C.34:1B-139.4) is amended to read as follows:
4. a. There is established a pilot program, to be administered by the New Jersey Economic Development Authority, through which the authority shall provide grants to businesses to assign their employees, who are New Jersey residents assigned to locations outside of the State, to New Jersey locations. A business shall be eligible for a grant under the pilot program if the business has 25 or more full time employees and is principally located in another state.
b. A business seeking a grant pursuant to this section shall submit an application for approval to the authority on or before July 1, 2028, in the form and manner prescribed by the chief executive officer of the authority. Following approval of an application, but before the disbursement of grant funds, the authority shall require the business to enter into a grant agreement. The grant agreement shall, at a minimum, specify the amount of the grant to be awarded to the business, the minimum number of resident employees the business shall assign to the State, and, if applicable, the terms governing actions proposed to be undertaken by the business for the purpose of receiving the preference authorized by subsection c. of this section. If the authority determines that the business made a material misrepresentation on the business's grant application or if the business fails to comply with any requirement set forth in the grant agreement, then the business shall return to the authority any grant awarded pursuant to this section.
c. [The] Except as otherwise provided in subsection d. of this section, the value of the grant shall be the New Jersey Gross Income Tax withholdings of resident employees re-assigned by the business to a New Jersey location, as certified by the Director of the Division of Taxation, or $500,000, whichever is less. In awarding the grants made available by this section, the authority may establish a preference for businesses that: acquire or lease office space in this State and make a capital investment in such office space; submit to the authority a plan showing that the business will provide bonuses to, or otherwise increase the compensation of, employees relocating to the State; or both. The sum of all grants awarded pursuant to this section shall not exceed $35,000,000 in any State fiscal year.
As used in this subsection, "capital investment" means expenses that the business incurs, or are incurred on behalf of the business by its landlord, for construction, repair, renovation, improvement, equipping, or furnishing of a building or structure acquired or leased by the business and used in connection with the operation of the business.
d. Notwithstanding any provision of any other law, rule, or regulation to the contrary, the amount of the grant awarded to a business pursuant to this section may exceed the $500,000 limit set forth in subsection c. of this section, if the authority determines that the long-term gross income tax revenues generated from all resident employees re-assigned by the business to a New Jersey location are projected to exceed 200 percent of the amount of the grant.
e. The authority shall take appropriate measures to inform businesses potentially eligible under the pilot program about its benefits, which measures may include, but shall not be limited to: advertising the pilot program in areas or publications likely to reach such businesses; and designating an individual employed by the authority to serve as a liaison for the authority, who may inform businesses of the benefits of the pilot program and provide assistance concerning the submission of applications pursuant to this section.
(cf: P.L.2023, c.125, s.4)
2. Section 3 of P.L.2023, c.125 (C.54A:4-1.1) is amended to read as follows:
3. a. For taxable years beginning on and after January 1, 2020 but before January 1, 2024, a resident taxpayer who:
(1) pays any income tax or wage tax imposed for the taxable year by another state of the United States, or political subdivision of such state, or by the District of Columbia;
(2) applies for and is denied a refund from such state or jurisdiction for taxes paid to that state or jurisdiction on income derived from services rendered while the resident taxpayer was within New Jersey;
(3) files an appeal with a tax court or tribunal through which the resident taxpayer formally protests the denial by another state or jurisdiction of the refund requested by the resident taxpayer for taxes paid on income derived from services rendered while the resident taxpayer was within New Jersey; and
(4) obtains a final judgement from the tax court or tribunal resulting in the resident taxpayer being refunded taxes paid to another state or jurisdiction on income derived from services rendered while the resident taxpayer was within New Jersey shall be allowed a credit against the tax otherwise due for the taxable year under the "New Jersey Gross Income Tax Act," N.J.S.54A:1-1 et seq., in amount equal to 50 percent of the amount of taxes that are owed to the State of New Jersey as a result of the readjustment of the credit for tax of another state pursuant to subsection (e) of N.J.S.54A:4-1.
b. If the amount of the credit allowed pursuant to subsection a. of this section exceeds the amount of tax otherwise due, that amount of excess shall be an overpayment for the purposes of N.J.S.54A:9-7; provided however, that subsection (f) of N.J.S.54A:9-7 shall not apply.
c. The Division of Taxation in the Department of the Treasury shall, in consultation with the Division of Law in the Department of Law and Public Safety, develop and publish on its Internet website general, plain-language guidance for a resident taxpayer who: applies for a refund from a state or jurisdiction on income derived from services rendered while the resident taxpayer was within New Jersey; and seeks a judgement granting such refund, including a judgement on appeal, from the state or jurisdiction's appropriate tax court or tribunal. The guidance published pursuant to this subsection may include, but shall not be limited to:
(1) an overview of the circumstances under which a resident taxpayer may be entitled to a refund from a state or jurisdiction as described in this section, including information about which states or jurisdictions may issue a refund on this basis;
(2) resources by which a resident taxpayer may obtain more information about the process of applying for or appealing the denial of a refund as described in this section, which may include, but shall not limited to, information specific to states or jurisdictions from which resident taxpayers are likely to seek a refund, including states or jurisdictions geographically contiguous to this State; and
(3) contact information for individuals employed by the Division of Taxation in the Department of the Treasury or the Division of Law in the Department of Law and Public Safety who may be designated to answer questions from, or provide further resources to, a resident taxpayer with respect to an application or appeal for a refund.
d. The Division of Taxation in the Department of the Treasury, in consultation with the Division of Law in the Department of Law and Public Safety, shall be authorized to join or intervene on behalf of a State resident who is suing for a refund or contesting the collection of taxes on that State resident's income by another state or jurisdiction.
(cf: P.L.2023, c.125, s.3)
3. This act shall take
effect immediately.
STATEMENT
This bill amends current provisions of law governing the New Jersey Re-Assigning In-State Employees pilot program (program) administered by the New Jersey Economic Development Authority (authority). The bill also requires the Division of Taxation in the Department of the Treasury to publish certain guidance for resident taxpayers seeking a refund from other states or jurisdictions.
Under the program, a business may apply for a grant to support the re-assignment of employees, who are New Jersey residents assigned to locations outside of the State, to New Jersey locations. Current law authorizes the authority, pursuant to a grant agreement with a business, to issue a grant with a value equal to the New Jersey Gross Income Tax withholdings of resident employees re-assigned by the business to a New Jersey location or $500,000, whichever is less. The total value of grants under the program is limited to $35 million.
This bill authorizes the authority to issue a grant to a business in excess of the $500,000 limit, when the authority determines that the long-term gross income tax revenues generated from all resident employees re-assigned by the business to a New Jersey location are projected to exceed 200 percent of the grant award. The bill also requires the authority to take appropriate measures to inform businesses potentially eligible under the pilot program about its benefits, which measures may include, but not be limited to: (1) advertising the program in areas or publications likely to reach such businesses; and (2) designating an individual employed by the authority to serve as a liaison for the program.
Additionally, the bill requires the Division of Taxation, in consultation with the Division of Law in the Department of Law and Public Safety, to develop and publish on its Internet website plain-language guidance for a resident taxpayer who: (1) applies for a refund from a state or jurisdiction on income derived from services rendered while the resident taxpayer was within New Jersey; and (2) seeks a judgement granting such refund, including a judgement on appeal, from the state or jurisdiction's appropriate tax court or tribunal. This guidance may include, but not be limited to: (1) an overview of the circumstances under which a resident taxpayer may be entitled to a refund from a state or jurisdiction; (2) resources by which a resident taxpayer may obtain more information about the process of applying for or appealing the denial of a refund; and (3) contact information for individuals employed by the Division of Taxation or the Division of Law who may be designated to answer questions from, or provide further resources to, a resident taxpayer with respect to an application or appeal for a refund.
The bill also authorizes the Division of Taxation, in consultation with the Division of Law in the Department of Law and Public Safety, to join or intervene on behalf of a State resident who is suing for a refund or contesting the collection of taxes on that State resident's income by another state or jurisdiction.
