Bill > S604

Introduced Session

This bill allows corporation business tax (CBT) credits and gross income tax (GIT) credits for small business employers and farm employers for payment of the increased State minimum wage. The bill provides small business employers and farm employers with a tax credit equal to the difference of: 1) the minimum hourly wage required to be paid to an employee pursuant to section 5 of P.L.1966, c.113, following the enactment of P.L.2019, c.32, which phases the State minimum wage up to $15.00 per hour, multiplied by the number of hours worked by an employee during a privilege period or taxable year; minus 2) that minimum hourly wage required to be paid on the day prior to the enactment of that same law, factoring in any adjustments to the minimum hourly wage, such as inflation, as required by law at that time. The term "small business employer" means a taxpayer that: 1) employs fewer than 25 employees in this State, which employees shall have been employed by the employer for not less than 48 weeks of the calendar year and which are employed by the taxpayer as of the last day of the calendar year; and 2) generates less than $1 million in annual net receipts, based on the average of the three preceding privilege periods or taxable years. The term "farm employer" means a taxpayer in this State who engages individuals in this State on a piece-rate or regular hourly rate basis to labor on a farm. The bill restricts the number of employees that can be used in calculating the tax credit amount, caps the credit amount at $12,500 for each employee included in the calculation of the credit, and limits the credit's availability to the ten subsequent privilege periods or taxable years that commence immediately following the effective date of the bill. Any amount of the tax credit that cannot be taken against a small business employer's or farm employer's CBT liability can be carried forward for four privilege periods following the privilege period for which a portion of the tax credit was allowed. If the GIT credit exceeds a small business employer's or farm employer's liability, the small business employer or farm employer can receive a refund for the amount in excess. The bill requires the Director of the Division of Taxation in the Department of the Treasury to determine the form and manner by which a taxpayer can apply for the tax credit.

AI Summary

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Latham Tiver (R)*, 

Introduced in the Senate, Referred to Senate Budget and Appropriations Committee (on 01/09/2024)

Official Document