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A1776
ASSEMBLY, No. 1776
STATE OF NEW JERSEY
222nd LEGISLATURE
�
PRE-FILED FOR INTRODUCTION IN THE 2026 SESSION
Sponsored by:
Assemblyman ANTHONY S. VERRELLI
District 15 (Hunterdon and Mercer)
Assemblyman AL BARLAS
District 40 (Bergen, Essex and Passaic)
Co-Sponsored by:
Assemblyman Sampson
SYNOPSIS
���� Allows credit against corporation business tax and
gross income tax liability for employing persons with a developmental
disability.
CURRENT VERSION OF TEXT
���� Introduced Pending Technical Review by Legislative
Counsel.
��
An Act
al
lowing a credit against the corporation
business tax and the gross income tax for employing persons with a
developmental disability, 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 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 salary and wages paid by the taxpayer during the privilege period to
an employee with a developmental disability.
���� For purposes of this section,
�employee with a developmental disability� means an employee of the taxpayer who
has a developmental disability as defined in subsection b. of section 3 of
P.L.1985, c.145 (C.30:6D-25) and for who the Division of Developmental
Disabilities in the Department of Human Services has declared eligible for its services.
���� b.��� The credit allowed
pursuant to this section shall not exceed $3,000 for each employee with a
developmental disability, and shall not exceed a total credit of $60,000 for
the taxpayer�s privilege period.
���� c.���� The director shall
prescribe the order of priority of the application of the credit allowed under
this section and any other credits allowed by law against the tax imposed under
section 5 of P.L.1945, c.162 (C.54:10A-5). The amount of the credit 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 credits allowed by
law, 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). Any remaining credit shall not be carried forward to another
privilege period.
���� d.��� A taxpayer shall not be
allowed a credit pursuant to this section and pursuant to section 1 of
P.L.2005, c.318
(C
54:10A-5.38
) for the same employee in the
same privilege period.
�
���� 2.��� a. A taxpayer shall be
allowed a credit against the tax otherwise due pursuant to �New Jersey Gross
Income Tax Act,� N.J.S.54A:1-1 et seq., in an amount equal to 10 percent
of the salary and wages paid by the taxpayer during the
taxable year to
an employee with a developmental disability.
���� For purposes of this section,
�employee with a developmental disability� means an employee of the taxpayer who
has a developmental disability as defined in subsection b. of section 3 of
P.L.1985, c.145 (C.30:6D-25) and for who the Division of Developmental
Disabilities in the Department of Human Services has declared eligible for its services.
���� b.��� The credit allowed
pursuant to this section shall not exceed $3,000 per employee with a
developmental disability, and shall not exceed a total credit of $60,000 for
the taxpayer�s taxable year.
�
���� c.���� The
order of priority of the application of the credit allowed pursuant to this
section and any other credits allowed pursuant to the �New Jersey Gross Income
Tax Act,� 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
tax imposed for a taxable year, together with any other credits allowed by law,
shall not reduce the tax liability to an amount less than zero.
Any
remaining credit shall not be carried forward to another taxable year.
���� d.��� A business entity that
is classified as a partnership for federal income tax purposes shall not be
allowed the credit directly, but the amount of credit of a 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.
���� A taxpayer that is a New
Jersey S corporation shall not be allowed the credit directly, 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.
���� e.���� A taxpayer shall not be
allowed a credit pursuant to this section and pursuant to section 2 of
P.L.2005, c.318
(C.54A:4-11) for the same employee
in the same taxable year.
���� 3.���
Notwithstanding any provision of the �Administrative Procedure Act,�
P.L.1968, c.410 (C.52:14B-1 et seq.) to the contrary, the Director of the
Division of Taxation is authorized to adopt immediately upon filing with the
Office of Administrative Law such rules and regulations as are necessary to
effectuate the provisions of this act, which shall be effective for a period
not to exceed 18 months following the date of filing and may thereafter be
amended, adopted, or readopted by the director in accordance with the
requirements of P.L.1968, c.410 (C.52:14B-1 et seq.).
���� 4.��� This act shall take
effect immediately and apply to taxable years and privilege periods beginning
on or after January 1 next following the date of enactment.
STATEMENT
����� This bill allows taxpayers to claim a credit against
their corporation business tax liability or gross income tax liability in the
amount of 10 percent of salary and wages paid to an employee with a
developmental disability.� The credit is capped at $3,000 per employee, and the
total credit is capped at $60,000 per taxpayer per year.
����� The bill defines �employee with a developmental
disability� as an employee of the taxpayer who has a developmental disability
as defined in N.J.S.A.30:6D-25 and for who the Division of Developmental
Disabilities in the Department of Human Services has declared eligible for its
services.
����� New Jersey already allows taxpayers to claim a credit
for the employment of certain persons with disabilities at an occupational
training center or sheltered workshop.� This bill allows a credit for any type
of employment, but taxpayers will be prohibited from claiming the credit
allowed by this bill if in the same year they claim a credit for employment of
the same employee at an occupational training center or sheltered workshop.