Provides corporation business and gross income tax credit for employment of persons who have experienced job loss due to automation.

A4359

ASSEMBLY, No. 4359

STATE OF NEW JERSEY

222nd LEGISLATURE

�

INTRODUCED FEBRUARY 19, 2026

Sponsored by:

Assemblyman� ALEX SAUICKIE

District 12 (Burlington, Middlesex, Monmouth and Ocean)

Co-Sponsored by:

Assemblyman Scharfenberger

SYNOPSIS

���� Provides corporation business and gross income tax
credit for employment of persons who have experienced job loss due to
automation.�

CURRENT VERSION OF TEXT

���� As introduced.

��

An Act
providing a tax credit for the employment of persons
who have experienced job loss due to automation 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 with a
headquarters in New Jersey shall be allowed a credit against the tax due
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 to each person employed by the taxpayer
whose previous employment with another taxpayer was terminated as a result of
automation during the immediately preceding privilege period.� In order to
qualify for the credit, the taxpayer shall employ the person for at least seven
months of the privilege period for which the taxpayer claims the credit.� The
credit allowed pursuant to this section shall not exceed $2,500 per employee
per privilege period.�

���� b.��� 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 section 5 of P.L.1945,
c.162 (C.54:10A-5) for a privilege period shall be as prescribed by the director.�
The amount of the credit applied pursuant to this section against the tax
imposed pursuant to section 5 of P.L.1945, c.162 (C.54:10A-5) shall not reduce
a qualified taxpayer�s 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 priority in which credits allowed pursuant to this
section and any other credits allowed against the tax imposed pursuant to
section 5 of P.L.1945, c.162 (C.54:10A-5) shall be as determined by the
director.� 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 may be carried over, if necessary, to the seven privilege periods
following the privilege period for which the credit was allowed.

���� c.��� As used in this section,
�automation� means a device, process, or system that functions without
continuous input from a human operator.

���� 2.��� a.� A taxpayer with a
headquarters in New Jersey shall be allowed a credit against the �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 to each person employed by the taxpayer whose
previous employment with another taxpayer was terminated as a result of
automation during the immediately preceding taxable year.� In order to qualify
for the credit, the taxpayer shall employ the person for at least seven months
of the taxable year for which the taxpayer claims the credit.� The credit
allowed pursuant to this section shall not exceed $2,500 per qualifying
employee per taxable year.

���� b.��� 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 pursuant to this section against the tax imposed pursuant to
N.J.S.54A:1-1 et seq. shall not reduce a taxpayer�s tax liability for a taxable
year 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 subsection may be carried forward, if necessary, to
the seven taxable years following the taxable year for which the tax credit was
allowed.

���� c.��� (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.

���� d.��� As used in this section,
�automation� means a device, process, or system that replaces human labor and
functions without continuous input from an operator.

���� 3.��� 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 would provide a
corporation business and gross income tax credit for businesses with a
headquarters in New Jersey for employment of persons who have experienced job
loss due to automation.�

���� According to a 2020 ALICE (Asset
Limited, Income Constrained, Employed) report from United Way of New Jersey
analyzing living conditions for households with incomes above the Federal
Poverty Level, but below the basic cost of living, found that 84 percent of
jobs paying less than $20 per hour and 42 percent of jobs paying more than $20
per hour in the State are at high risk of becoming automated. �The sponsor
notes that Ocean County is among the State�s counties with the highest rates of
these types of jobs, leaving many of the county�s residents and families
vulnerable to the impact of job loss due to automation.�

���� The amount of the credit would
be equal to 10 percent of the salary and wages paid to each person employed by
the taxpayer whose previous employment with another taxpayer was terminated as
a result of automation during the immediately preceding privilege period or
taxable year, as the case may be.� In order to qualify for the credit, the
taxpayer would be required to employ the person for at least seven months of
the privilege period or taxable year for which the taxpayer claims the credit.�
The amount of the credit would not exceed $2,500 per employee per privilege
period or taxable year.� The bill defines �automation� as a device, process, or
system that replaces human labor and functions without continuous input from an
operator.