Sales and Use Tax Exemption Program
The Sales and Use Tax Exemption Program allows companies to make purchases for construction and renovation of their new business location without having to pay state sales tax. This program is often used in conjunction with the Business Retention and Relocation Assistance Grant (BRRAG) program. Eligible companies must have 1,000 or more employees in New Jersey and relocate 500 or more to a new business location. Life sciences, pharmaceutical and manufacturing companies may be eligible if they relocate 250 or more employees to a new research and development facility, a new headquarters or a new manufacturing facility.
Site Selection Services
New Jersey offers a full range of site selection tools including development services, land assemblage, structuring financing and facilitating the permitting process. This full-service approach provides considerable financing advantages for companies considering moving to or expanding in New Jersey.
Small Business Fund
Small Business Fund provides expedited approvals of loans, loan participations and guarantees up to $300,000 to creditworthy small, women and minority-owned businesses that have been in operation for at least one year, as well as not-for-profit corporations that have been in operation for at least three years. These loans may be used for fixed assets or working capital.
Small Business Services:
Entrepreneurial Training Initiative
To help New Jersey's entrepreneurs and small businesses start, run and grow, the New Jersey Economic Development Authority (EDA) has formed a strategic partnership with UCEDC, a statewide, not-for-profit economic development corporation dedicated to assisting and financing small businesses, minority- and women-owned enterprises. Whether you are an entrepreneur looking for assistance to create a business plan and get your idea up and running, or you are an existing small business looking to grow, UCEDC offers programs to help. Business basics workshops, entrepreneurial training, business mentoring, International Organization for Standardization (ISO) Training 9001 and more are available.
New Jersey Small Business Development Centers (NJSBDC)
The NJSBDC network consists of eleven full-service Regional Centers and additional offices in every county of New Jersey providing management consulting services and training to small business owners and entrepreneurs. The network helps small businesses expand operations, manage growth and launch new ventures.
Latin American Economic Development Association (LAEDA)
The Latin American Economic Development Association, Inc. (LAEDA) was incorporated in New Jersey in 1987 as a nonprofit, 501 (c) (3) tax-exempt corporation. The organization was established through the efforts of the National Puerto Rican Coalition along with local community and business leaders to create economic opportunities for minorities while facilitating the redevelopment of Camden City. LAEDA is a successfully governed and managed minority enterprise.
Rising Tide Capital, Inc.
Rising Tide Capital is a 501-c-3 non-profit organization based in Jersey City, NJ, transforming lives and communities through entrepreneurship. Rising Tide Capital's programs support women, minorities, immigrants and other traditionally marginalized populations to start and grow successful businesses.
Solar Renewable Energy Certificate (SREC) Registration Program (SRP)
The SRP is used to register the intent to install non-rebated solar projects in New Jersey. Owners of non-rebated solar projects must register their projects in the SRP prior to the start of construction in order to establish the project's eligibility to earn SRECs. Registration of the intent to participate in New Jersey's solar marketplace provides market participants with information about the pipeline of anticipated new solar capacity and insight into future SREC pricing. Each time a system generates 1,000 kWh of electricity, an SREC is earned and placed in the customer's electronic account. SRECs can then be sold on the SREC tracking system, providing revenue for the first 15 years of the system's life. Electricity suppliers, the primary purchasers of SRECs, are required to pay a Solar Alternative Compliance Payment (SACP) if they do not meet the requirements of New Jersey's solar renewable portfolio standard (RPS). One way they can meet their RPS requirement is by purchasing SRECs. As SRECs are traded in a competitive market, the price may vary significantly. The actual price of an SREC during a trading period can and will fluctuate depending on supply and demand.
Statewide Loan Pool
Under the Statewide Loan Pool program, the New Jersey Economic Development Authority (EDA) participates in loans from EDA participating banks. The EDA may also guarantee a portion of the remaining lender's exposure when a bank requires additional comfort on a particular project. Up to $1.25 million is available for fixed asset financing, and up to $750,000 is available for working capital. Additionally, $1.5 million is available under either program for loan guarantees. To qualify, eligible businesses or not-for-profits must create one new full-time job for every $50,000 of EDA assistance. In addition, preference is given to businesses that are job intensive, will create or maintain tax ratables, are located in an economically distressed area, represent an important economic sector of the state and/or will contribute to its growth and diversity.
Technology Business Tax Certificate Transfer Program
Qualified biotechnology and technology companies may be eligible to sell unused net operating losses and R&D tax credits to unrelated profitable corporations for at least 80 percent of their value, up to a maximum lifetime benefit of $15 million. To qualify, the applicant must have at least one full-time employee working in New Jersey if incorporated less than three years, five full-time employees in New Jersey if incorporated more than three years but less than five years, and 10 full-time employees in New Jersey if incorporated more than five years.
Urban Enterprise Zones (UEZ)
New Jersey's UEZ Program was created to foster an economic climate that revitalizes designated urban communities and stimulates their growth by encouraging businesses to develop and create private sector jobs through public and private investment. Participating businesses may be eligible for a variety of incentives. The program currently has over 30 zones located in over 35 municipalities throughout the state.
Urban Enterprise Zones (UEZ) Manufacturers Energy Sales Tax Exemption
Certified UEZ manufacturers with at least 250 full-time employees, 50 percent of whom are involved in the manufacturing process, may be eligible for an exemption from the sales and use tax on energy and utility services.
Urban Enterprise Zones (UEZ) Sales Tax Exemption on Purchases
Businesses located in a designated UEZ may be eligible for an exemption from sales tax on most purchases, with certain exceptions. The exemption applies to the full sales tax otherwise due on purchases of tangible personal property (except motor vehicles, parts or supplies), and most services (except telecommunications services). Businesses with total gross receipts of less than $10 million (for all locations, in and out of the zones) may be eligible for the exemption at time of purchase, while businesses with total gross receipts over $10 million (for all locations, in and out of the zones) will pay the prevailing sales tax at time of purchase and apply quarterly for a refund of sales taxes paid. A separate exemption, not guided by total gross receipts, applies to materials, supplies and services for the exclusive use in erecting structures or building on, or improving, altering or repairing, the real property of a qualified business located in the zone that are purchased for the benefit of the business property located in the zone, whether purchased by the qualified business or a contractor.
Urban Enterprise Zones (UEZ) Employment Tax Credit
UEZ-based businesses receive employment tax credits for hiring new, additional full-time employees. A credit of $1,500 is allowed for each new, additional full-time employee living in a UEZ municipality who immediately prior to employment by the taxpayer was unemployed for at least 90 days, or was dependent upon public assistance as the primary source of income. For new, additional full-time employees not qualifying for the $1,500 credit, a credit of $500 is allowed if the employee lives in a UEZ municipality and was not employed in the UEZ municipality immediately prior to being hired. Employees must be employed for at least six continuous months to earn the credit.
Urban Enterprise Zones (UEZ) Investment Tax Credit
Certified UEZ businesses that are not entitled to a UEZ Employee Tax Credit may be entitled to the UEZ Investment Tax Credit. This credit is available to non-retail and non-warehouse corporations with fewer than 50 employees. For employers with fewer than 10 employees, qualified investments must be at least $5,000. For employers with more than 10 employees, the minimum investment requirement of $5,000 increases by $500 per each additional employee beyond 10. The tax credit may be equal to up to 8 percent of the qualified investment.
Medium-sized projects in any one of nine endorsed urban municipalities (Camden, Trenton, Newark, Jersey City, Paterson, Elizabeth, East Orange, New Brunswick, or Atlantic City) may be eligible for loans up to $3 million for fixed asset financing.
Urban Transit Hub Tax Credit Program
A developer, owner or tenant making a qualified capital investment within a designated Urban Transit Hub may be eligible for tax credits equal up to 100 percent of the investments made within an eight-year period. Taxpayers may apply 10 percent of the total credit amount per year over a ten-year period against their corporate business tax, insurance premiums tax or gross income tax liability. Developers or owners must make a minimum $50 million capital investment in a single business facility, and at least 250 fulltime employees must work at that facility. Tenants in a qualified business facility can represent at least $17.5 million of the capital investment in the facility, and up to three tenants may aggregate to meet the 250 employee requirement. In addition, developers making capital investments in qualified residential projects may be eligible for tax credits up to 20 percent of the capital investment. Urban Transit Hubs are located within one-half mile of New Jersey Transit, PATH, PATCO, or light rail stations in East Orange, Elizabeth, Hoboken, Jersey City, Newark, New Brunswick, Paterson, or Trenton. An additional Urban Transit Hub is located in Camden, where the one-half mile radius is extended to one mile within New Jersey Transit, PATH, PATCO or light rail stations. Eligibility is expanded to locations within any of the nine listed municipalities that have active freight adjacent or connected to the proposed building, and utilized by the occupant. The expiration date for the commercial portion of this program is January 13, 2013. The expiration date for the residential portion of this program is July 28, 2014.
New Jersey State Contact:
New Jersey Business Action Center
Trenton, NJ 08625-0820
Incentive and tax information is provided to Area Development by each state's economic development or commerce agency for information purposes only and is subject to revision at any time by the state government. Please contact the state agency directly for full requirements and offerings.