N.J. Admin. Code § 18:35-11.1
For the purposes of this subchapter only, the following terms shall have the following meanings:
"Common trust fund" means a fund maintained by a bank, which fund is subject to I.R.C. § 584 and which is free from New Jersey taxation pursuant to 17:9A-44.
"Income" means income, loss, gain, or expense.
" Partner" means, and includes without necessarily being limited thereto, each entity that receives a K-1 or NJ-K1 from a partnership. For the purposes of this section, a partner refers to the definition in this section, although a partner can at the same time also be a partner in a civil union.
" Partnership" means any entity classified as a partnership for Federal income tax purposes. The term includes, but is not limited to, a general partnership, a limited liability partnership, a limited partnership, a family limited partnership, and a limited liability company. The term includes partnerships whose members receive nontaxable income pursuant to 54A:5-8(c), commonly referred to as hedge funds and qualified investment partnerships as defined in 54:10A-4(r). However, the term does not include investment clubs or common trust funds. For the purposes of this section, a partnership shall not mean partners of a civil union couple.
"Investment club" means an entity that is classified as a partnership for Federal income tax purposes and, all of whose owners are individuals. All of the entity's assets must be securities, cash, or cash equivalents, and its assets must be valued on a consistent basis at the lower of cost or fair market value. In calculating assets for a privilege period, a quarterly average must be used, and the total value must be less than $ 60,000. See also 18:35-1.3. To illustrate, an investment club is formed when a group of friends, neighbors, business associates, or others pool their money to invest in stock or other securities. The club may or may not have a written agreement, a charter, or bylaws.
Usually the group operates informally, with members pledging to pay a regular amount into the club, monthly. Some clubs have a committee that gathers information on securities, selects the most promising securities, and recommends that the club invest in them. Other clubs rotate these responsibilities among all their members. Most clubs require all members to vote for or against all investments, sales, trades, and other transactions.
N.J. Admin. Code § 18:35-11.1