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A4604
ASSEMBLY, No. 4604
STATE OF NEW JERSEY
222nd LEGISLATURE
�
INTRODUCED MARCH 10, 2026
Sponsored by:
Assemblywoman� CAROL A. MURPHY
District 7 (Burlington)
SYNOPSIS
���� Allows corporation business tax and gross income tax
credits to businesses employing certain persons with developmental
disabilities.�
CURRENT VERSION OF TEXT
���� As introduced.
��
An Act
allowing credits against the corporation business tax
and the gross income tax to businesses employing certain persons with
developmental disabilities, and 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.� As used in this
section, "qualified person with a developmental disability" means an
individual who:
���� (1)�� has a severe, chronic
disability, which: (a) is attributable to a mental or physical impairment or
combination of mental or physical impairments; (b) is manifest before age 22; (c)
is likely to continue indefinitely; (d) results in substantial functional
limitations in an area of major life activity; and (e) reflects the need for a
combination and sequence of special interdisciplinary or generic care,
treatment, or other services which are of lifelong or extended duration and are
individually planned and coordinated; or�
���� (2)�� has severe disabilities
attributable to an intellectual disability, autism, cerebral palsy, epilepsy,
spina bifida, or other neurological impairments.
���� b.��� The director shall allow
a taxpayer 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 40 percent of the first $6,000 of
wages paid by the taxpayer during the privilege period for the employment of a
qualified person with a developmental disability, not to exceed $2,400 for each
qualified person with a developmental disability for the privilege period.
���� c.���� A taxpayer shall apply
the credit awarded against the taxpayer�s liability under section 5 of
P.L.1945, c.162 (C.54:10A-5) for the current privilege period as of the date of
the credit's approval.�
���� d.��� 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 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).
���� e.���� (1)������� A taxpayer
shall not be granted a credit pursuant to this section for the qualified wages
paid to a qualified person with a developmental disability in a privilege
period if the qualified wages of the qualified person with a developmental disability
or the job providing qualified wages to the qualified person with a developmental
disability is included in the calculation of another credit against any State
tax or grant for a period of time that coincides with the applicable privilege
period.
���� (2)�� If the director
determines that a taxpayer is displacing employees and replacing the employees
with a qualified person with a developmental disability for the primary
purposes of obtaining the credit allowed pursuant to this section, the director
shall deny the taxpayer the credit allowed under this section and shall issue a
tax assessment for the recapture of credit previously allowed to the taxpayer
under this section plus an assessment of 50 percent of any credit subject to
recapture as penalty.
���� 2.��� a.� As used in this
section, "qualified person with a developmental disability" means an
individual who:
���� (1)�� has a severe, chronic
disability, which: (a) is attributable to a mental or physical impairment or
combination of mental or physical impairments; (b) is manifest before age 22; (c)
is likely to continue indefinitely; (d) results in substantial functional
limitations in an area of major life activity; and (e) reflects the need for a
combination and sequence of special interdisciplinary or generic care,
treatment, or other services which are of lifelong or extended duration and are
individually planned and coordinated; or�
���� (2)�� has severe disabilities
attributable to an intellectual disability, autism, cerebral palsy, epilepsy,
spina bifida, or other neurological impairments.
���� b.��� The director shall allow
a taxpayer a credit against the tax otherwise due pursuant to the �New Jersey
Gross Income Tax Act,� N.J.S.54A:1-1 et seq., in an amount equal to 40 percent
of first $6,000 of the wages paid by the taxpayer during the taxable year for
the employment of a qualified person with a developmental disability during the
taxable year, not to exceed $2,400 for each qualified person with a developmental
disability for the taxable year.
���� c.���� A taxpayer shall apply
the credit awarded against the taxpayer�s liability under N.J.S.54A:1-1 et seq.
for the current taxable year as of the date of the credit's approval.
���� d.��� 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
N.J.S.54A:1-1 et seq.� The amount of the credit applied under this section
against the tax imposed pursuant to N.J.S.54A:1-1 et seq. for a taxable year,
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 zero.
���� e.���� (1)� A taxpayer shall
not be granted a credit pursuant to this section for the qualified wages paid
to a qualified person with a developmental disability in a taxable year if the
qualified wages of the qualified person with a developmental disability or the
job providing qualified wages to the qualified person with a developmental disability
is included in the calculation of another credit against any State tax or grant
for a period of time that coincides with the applicable taxable year.
���� (2)�� If the director
determines that a taxpayer is displacing employees and replacing the employees
with a qualified person with a developmental disability for the primary
purposes of obtaining the credit allowed pursuant to this section, the director
shall deny the taxpayer the credit allowed under this section and shall issue a
tax assessment for the recapture of credit previously allowed to the taxpayer
under this section plus an assessment of 50 percent of any credit subject to
recapture as penalty.
���� f.���� A partnership 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.
���� 3.��� This act shall take
effect immediately and shall apply to wages paid in privilege periods and
taxable years beginning after enactment.�
STATEMENT
���� This bill allows corporation
business tax and gross income tax credits to businesses that employ qualified
persons with developmental disabilities.� The amount of each credit would be
equal to 40 percent of the first $6,000 of wages paid to the qualified person
with a developmental disability, a maximum of $2,400 per qualified person with a
developmental disability.
���� A qualified person with a developmental
disability is defined in the bill as a person who: (1)� has a severe, chronic
disability, which: (a) is attributable to a mental or physical impairment or
combination of mental or physical impairments; (b) is manifest before age 22; (c)
is likely to continue indefinitely; (d) results in substantial functional
limitations in an area of major life activity; and (e) reflects the need for a
combination and sequence of special interdisciplinary or generic care,
treatment, or other services which are of lifelong or extended duration and are
individually planned and coordinated; or (2) has severe disabilities attributable
to an intellectual disability, autism, cerebral palsy, epilepsy, spina bifida, or
other neurological impairments.
���� These State tax credits are
modeled on the federal Work Opportunity Tax Credit (WOTC), which encourages
employers to hire targeted groups of employees, including certain persons with
developmental disabilities.� Under the federal WOTC, employers may claim a
federal tax credit of up to 40 percent of the first $6,000 earned by the
employee, or $2,400.
���� According to the sponsor, the
tax credits allowed under this bill would encourage businesses to employ
qualified persons with developmental disabilities, who often face barriers to
employment.