Bill > A4426

Introduced Session

This bill provides credits against the New Jersey gross income tax and corporation business tax, as applicable, to vineyards and wineries for qualified capital expenses, as defined in the bill, in an amount equal to 25 percent of the qualified capital expenses made in connection with the establishment of a new vineyard or winery or the capital improvements made to an existing vineyard or winery during each taxable year in which the qualified vineyard or winery is operated for a profit by the taxpayer. Under the bill, a "qualified capital expense" means all expenditures made by the taxpayer for the purchase and installation of equipment or agricultural materials for use in the production of agricultural products at a vineyard or winery, but not for use on preserved farmland, including: 1. barrels; 2. bins; 3. bottling equipment; 4. canopy management machines; 5. capsuling equipment; 6. chemicals; 7. corkers; 8. crushers; 9. deer control fencing; 10. destemmers; 11. fermenters or other recognized fermentation devices; 12. fertilizer and soil amendments; 13. filters; 14. fruit harvesters; 15. fruit plants; 16. hoses; 17. irrigation equipment; 18. labeling equipment; 19. lugs; 20. mowers; 21. poles; 22. posts; 23. presses; 24. pruning equipment; 25. pumps; 26. refractometers; 27. refrigeration equipment; 28. seeders; 29. soil; 30. small tools; 31. tanks; 32. tractors; 33. vats; 34. weeding and spraying equipment; 35. wine tanks; 36. wire; and 37. any other items as approved by the director in consultation with the Secretary of Agriculture. The amount of credit allowed is to be taken by the taxpayer to reduce the tax otherwise due and required to be paid for the taxable year to which the credit applies. A credit is only to be taken by the taxpayer to reduce the tax otherwise due and required to be paid for the taxable year in which the vineyard or winery is conducted or operated for a profit by the taxpayer. This bill provides that the total value of the grants of tax credits approved by the director that may be applied against a gross income and corporation tax liability for a taxable year shall not exceed an aggregate annual limit of $250,000. If the amount of tax credits applied for by taxpayers exceeds the aggregate annual limit of $250,000, then a taxpayer who has first applied for and has not been allowed a tax credit amount for that reason shall be allowed, in the order in which they have submitted an application, their approved amount of tax credit on the first day of the next succeeding taxable year in which tax credits are issued and are not in excess of the amount of credits available. Under the bill, a taxpayer is not to be permitted to take any credits to reduce or offset the New Jersey gross income tax liability or corporation tax liability that is incurred and required to be paid by the taxpayer in connection with the conduct or operation of a vineyard or winery unless the taxpayer has obtained prior written authorization from the director. The director is to establish an application process and prescribe the form and manner through which a taxpayer may make and file an application to obtain the director's written authorization for the allowance of a credit. Under the bill, the director is to review each application made and filed by a taxpayer and make a determination regarding the approval of an application seeing the director's written authorization for the allowance of accredit within 90 calendar days of the date a complete application is received. The director is to issue a written authorization for the allowance of a credit to each taxpayer that made and filed a complete application that has been reviewed and approved by the director within five calendar days of the date the director's determination is made. Each taxpayer issued a written authorization for the allowance of a credit is to include a copy of the director's authorization when filing a return that includes a claim for the credit. If the director fails to make a determination regarding the approval of an application seeking the director's written authorization for the allowance of a credit within 90 calendar days of the date a complete application is received, or if the director fails to issue a written authorization for the allowance of a credit within five calendar days of the date the director's determination is made, the application is to be deemed to have been approved and the written authorization is to be deemed to have been issued by the director. Each taxpayer that made and filed a complete application but fails to receive a determination from the director is to include a copy of the taxpayer's application when filing a return that includes a claim for the credit allowed. This bill is to expire with privilege periods and taxable years first commencing after July 1, 2027.

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Bob Andrzejczak (D)*,  Ronald Dancer (R)*,  Eric Houghtaling (D)*,  Vincent Mazzeo (D)*,  Elizabeth Muoio (D)*, 

Reported out of Asm. Comm. with Amendments, and Referred to Assembly Appropriations Committee (on 06/15/2017)