New Jersey Administrative Code › Title 18 - TREASURY - TAXATION › Chapter 7 - CORPORATION BUSINESS TAX ACT › Subchapter 1 - CORPORATIONS SUBJECT TO TAX UNDER THE ACT › Section 18:7-1.8 - Foreign corporations subject to tax

Current through Register Vol. 56, No. 14, July 15, 2024
(a) Qualifications for
				subject corporations. The tax is imposed on every foreign corporation subject to tax
				as described in
				N.J.A.C.
				18:7-1.6, and includes every corporation that
				derives receipts from sources within New Jersey or engages in contacts within New
				Jersey or does business, employs or owns capital or property, or maintains an office
				in New Jersey in a corporate or organized capacity, regardless of whether it has
				formally qualified or is authorized to do business in New Jersey, provided that the
				taxpayer's business activity in New Jersey is sufficient to give this State
				jurisdiction to impose the tax under the Constitution and statutes of the United
				States.
Example 1
A foreign manufacturing corporation has its factory outside New
				  Jersey. Its only activity in New Jersey is the maintenance of an office within the
				  State. The orders are forwarded to its home office outside the State for acceptance
				  and the merchandise is shipped from the factory direct to the purchasers. The
				  corporation is subject to the corporation business tax because it maintains an
				  office within the State.
Example 2
A foreign corporation, which operates several retail stores
				  outside New Jersey, leases an office in New Jersey for the convenience of its buyers
				  when they come to New Jersey. It has several employees permanently assigned to such
				  office. Salesmen call at the office to solicit orders from the buyers, and the
				  merchandise is shipped to such office by the sellers. Upon receipt, the merchandise
				  is examined and sent to the various stores of the corporation outside New Jersey.
				  The corporation is subject to the corporation business tax because it maintains an
				  office, is regularly doing business through its constituted representatives, and
				  owns property in New Jersey.
Note: The foregoing examples illustrate conditions giving rise to
				  subjectivity to the corporation business tax without regard to whether or not the
				  corporation holds a general or special certificate of authority to do business in
				  New Jersey.
Example 3
A foreign corporation has applied for and has received a
				  certificate of authority to do business in New Jersey by the Division of Revenue and
				  Enterprise Services, but does not actually do any business in New Jersey, nor does
				  it have any office or property or any employees in New Jersey, nor does it own or
				  employ capital here. The corporation has sought and received the privilege of
				  exercising its corporate franchise in New Jersey and is, therefore, subject to the
				  corporation business tax and must file a return and pay the minimum tax.
(b) A financial business corporation, a
				banking corporation, a credit card company, or similar business that has its
				commercial domicile in another state is subject to corporation business tax in this
				State if during any year it obtains or solicits business or receives gross receipts
				from sources within this State.
(c)
				Mandatory submission of affidavit; proof of authorization to do business. A foreign
				corporation, which is subject to tax under the Corporation Business Tax Act, must
				submit an affidavit by a duly authorized corporate officer, stating whether or not
				the corporation at any time prior to the date of admitted subjectivity under the
				Corporation Business Tax Act held any authorization to do business in New Jersey or
				carried on in this State any of the activities set forth in
				N.J.A.C.
				18:7-1.6(a).