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Committee Statement - Assembly Bill No. 5389, Assembly Commerce and Economic Development Committee

Summary

Statement to Assembly No. 5389 with committee amendments, State of New Jersey, dated March 8, 2021, in which the Assembly Commerce and Economic Development Committee reports Assembly Bill No. 5389 favorably. As amended, the bill allows corporation business tax and gross income tax credits for nonresidential and multifamily building improvement expenses to reduce the spread of COVID-19, for expenditures made during calendar years 2020, 2021, and 2022. The credit equals 75 percent of expenditures for a location of less than 30,000 square feet, capped at $100,000, and 50 percent for a location of 30,000 square feet or more, capped at $250,000. The statement says the bill is identical to Senate Bill No. 3305 (1R) and lists the committee amendments, including a carryforward of unused credit for up to seven years.

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“Committee Statement - Assembly Bill No. 5389, Assembly Commerce and Economic Development Committee.” Archived at Pandemic Darlings, https://pandemicdarlings.com/source-documents/2021-03-08-ace-a5389-s1-f5340975a7/, SHA-256 e4fcc9c058d2c2a5d7bfcda9c40c514342c58c9bab7bee55e99a8f6af60fdb56.

Full text

ASSEMBLY COMMERCE AND ECONOMIC DEVELOPMENT
                COMMITTEE

                          STATEMENT TO

                     ASSEMBLY, No. 5389
                         with committee amendments



       STATE OF NEW JERSEY
                           DATED: MARCH 8, 2021

          The Assembly Commerce and Economic Development Committee
      reports favorably and with committee amendments Assembly Bill No.
      5389.
          This bill, as amended, allows corporation business tax and gross
      income tax credits for nonresidential and multifamily building
      improvement expenses to reduce the spread of COVID-19. The
      credit will be allowed for expenditures made during calendar years
      2020, 2021, and 2022.
         The following expenditures will be includable in calculation of
      the credit: expenditures for (1) bi-polar ionization and ultraviolet
      lighting to disinfect indoor air and surfaces, including in elevators
      and work areas; (2) infrared thermometers for screening visitors in
      common areas; (3) transparent sneeze guards or shields; (4)
      touchless entryway and security; (5) ventilation; and (6) other
      materials, supplies, and equipment to reduce the spread of COVID-
      19 and necessary to create a safe environment for building
      occupants.
         The amount of credit allowed will be equal to: 75 percent of the
      taxpayer’s expenditures for a location of less than 30,000 square
      feet, but the credit for such expenditures cannot exceed $100,000;
      and 50 percent of the taxpayer’s expenditures for a location of
      30,000 square feet or more, but the credit for such expenditures
      cannot exceed $250,000. A taxpayer that claims a credit pursuant to
      this bill will be required to add back into their calculation of income
      the amount of any expenditures that the taxpayer deducted. This
      requirement ensures that the taxpayer does not get the double
      benefit of being allowed to deduct expenses from income and get a
      credit against their tax liability to cover the cost of those expenses.
          As amended and reported by the committee Assembly Bill No.
      5389 is identical to Senate Bill No. 3305 (1R), which also was
      amended and reported by the committee.
                                 2

COMMITTEE AMENDMENTS:
    The committee amended the bill to:
    - add a provision allowing tax credits for corporation business
taxpayers;
    - allow a credit for multifamily buildings, in addition to allowing a
credit for nonresidential buildings;
    - allow the carryforward of unused credit for up to seven years;
    - require a taxpayer to add back into their calculation of income
the amount of any expenditures outlined in the bill that the taxpayer
deducted; and
    - allow any immediately issued regulations to be in effect for 18
months, instead of 360 days.

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