Bill > A118

Introduced Session

This bill establishes credits under the corporation business tax and gross income tax for employers who employ certain disabled veterans. The purpose of the bill is to encourage employers to hire certain disabled veterans who are seeking employment. This bill provides an employer with a gross income tax or corporation business tax credit equal to 15 percent of the wages paid to a qualified disabled veteran, up to a maximum of $1,800 per disabled veteran per taxable year or privilege period. A qualified disabled veteran is a resident of the State, initially hired by the employer on or after the date of enactment, who has been honorably discharged or released under honorable circumstances from active service, on or after January 1, 1990, from any branch of the Armed Forces of the United States and who has been determined by the U.S. Department of Veterans Affairs to have a service-connected disability rating of 30 percent or higher. The VA uses a scale ranging from 10 to 100 percent, in increments of 10 percent, depending on the severity of the condition or illness to rate the extent of a veteran's disability. The credits established by this bill are temporary in that qualified wages are those wages paid by the employer to a qualified disabled veteran on or after January 1, 2017, but before January 1, 2020. The qualified disabled veteran must be employed for a least 185 business days of the taxable year or privilege period for which a credit is claimed. The bill contains provisions that prevent the potential for misuse of the tax credit. A taxpayer may not claim a credit established by this bill if the wages paid by that taxpayer to a qualified disabled veteran are already included in the calculation of any State tax credit or grant for the same tax year. If it is determined that a taxpayer is displacing current employees and replacing them with qualified disabled veterans for the primary purposes of utilizing a credit in this bill, the credit will be denied, and if any credit was previously allowed, it would be recaptured by the State and a penalty assessed against the taxpayer. The bill contains certain restrictions that prevent the corporation business tax credit provided by this bill from being used in conjunction with any other corporation business tax credit available to the taxpayer so as to exceed 50 percent of the tax liability otherwise due, or to reduce the taxpayer's corporation business tax liability to an amount less than the minimum required by statute. Similarly, the gross income tax credit provided by this bill may not be used to reduce a taxpayer's liability to an amount less than zero. Any unused credit resulting from those restrictions may be carried forward over seven tax years by the taxpayer. The bill also provides that a taxpayer eligible for a credit under this bill may apply to the Director of the Division of Taxation in the Department of the Treasury for a tax credit transfer certificate, in lieu of applying the credit against its tax liability. A tax credit transfer certificate may be sold or assigned to another taxpayer who has a corporation business tax or gross income tax liability in exchange for financial consideration of not less than 75 percent of the transferred credit amount.

Committee Categories

Don Guardian (R)*, 

Introduced, Referred to Assembly Military and Veterans' Affairs Committee (on 01/09/2024)

Official Document