Bill > S1422

This bill allows taxpayers to use an alternative method for depreciating certain costs associated with building new affordable housing developments, impacting both the Corporation Business Tax Act (C.54:10A-1 et seq.) and the New Jersey Gross Income Tax Act (Title 54A). Specifically, for eligible property expenditures, which are capital costs for constructing a new affordable housing development owned by the taxpayer, taxpayers can now depreciate a percentage of these costs over a 10-year period, rather than following the standard depreciation rules. The percentage eligible for this accelerated depreciation is calculated using a formula: twice the ratio of affordable housing units to the total number of units in the development. Affordable housing is defined as housing for households earning no more than 80% of the regional median income, and an affordable housing development is one where construction begins on or after the bill's effective date, does not receive certain tax exemptions or subsidies (like those under the "Long Term Tax Exemption Law" or from specific state/local housing agencies, excluding energy efficiency incentives), and has at least 20% of its units qualifying as affordable housing. The Director of the Division of Taxation will establish the necessary rules and regulations for implementing this provision, which applies to developments placed in service starting January 1, 2025.

Budget and Finance, Business and Industry

https://www.njleg.state.nj.us/bill-search/2024/S1422