N.J. Admin. Code § 19:31K-1.8

Current through Register Vol. 56, No. 21, November 4, 2024

Section 19:31K-1.8 - Recapture of tax benefits

(a) Unless excepted pursuant to (b) below, if a selling business fails to use the private financial assistance received for the surrender of tax benefits as required by this subchapter or fails to maintain a headquarters or a base of operation in the State during the five years following receipt of the private financial assistance, the seller shall forfeit and remit the face value of the tax credit certificate received for the surrender of tax benefits to the Department of the Treasury in accordance with the provisions at (c) and (d) below. The face value of the tax credit certificate is the amount of surrendered tax benefits.

(b) The forfeiture requirement at (a) above pertaining to the failure to maintain a headquarters or a base of operation in this State shall not be applicable if the failure is due to the liquidation of the new or expanding emerging technology or biotechnology business.

(c) In the event a selling business fails to maintain a headquarters or base of operation in the State during the five years following the receipt of the private financial assistance, the Authority will allow the selling business to retain 20 percent of the face value of the tax credit certificate for each full year the business remained in New Jersey providing the business forfeits and remits to the Department of the Treasury 20 percent per year on a cumulative basis for each year the business had remaining on the five year requirement to maintain a headquarters or base of operation in New Jersey.

Examples:

Move within one year of disbursement, recapture percentage equal to 100 percent of the face value of the tax credit certificate

Move within two years of disbursement, recapture percentage equal to 80 percent of the face value of the tax credit certificate

Move within three years of disbursement, recapture percentage equal to 60 percent of the face value of the tax credit certificate

Move within four years of the disbursement, recapture percentage equal to 40 percent of the face value of the tax credit certificate

Move within five years of the disbursement, recapture percentage equal to 20 percent of the face value of the tax credit certificate

(d) In the event a selling business fails to use the tax benefits or cash benefits as required by the Act, the Authority shall require the selling business to remit to the Department of the Treasury 100 percent of the amount of the unallowable expenditures.

N.J. Admin. Code § 19:31K-1.8

New Rule, R.2010 d.206, effective 10/4/2010.
See: 42 N.J.R. 1348(a), 42 N.J.R. 2322(b).
Amended by R.2015 d.135, effective 8/17/2015.
See: 47 N.J.R. 987(a), 47 N.J.R. 2186(a).
In (a), inserted "in subsections (c) and (d)" and the last sentence.

Recodified from 19:31-12.8 56 N.J.R. 807(a), effective 5/6/2024