New Jersey Economic Recovery Tax Credit and Instructions

Economic Recovery Tax Credit and Instructions
Form 313 Economic Recovery Tax Credit
FORM 313

New Jersey Corporation Business Tax
Economic Recovery Tax Credit

2023

Name as Shown on Return

Federal ID Number

Unitary ID Number, if applicable

NU

Read the instructions before completing this form
Combined Return Filers
	 The taxpayer is included as a taxable member on a New Jersey combined return. See instructions.
Fill in oval if member is not sharing its credit with other members of the group.

Part I	

Taxpayer and Employee Preliminary Qualifications

	 1.	 Is the taxpayer receiving a benefit under the New Jersey Urban Enterprise Zones Act?...........................

	

  YES	

NO

	 2.	 Did the new full-time position at the qualifying location exist prior to credit year one?...............................

	

  YES	

NO

	 3.	 Is the full-time position filled by an employee of the taxpayer on a temporary or seasonal basis?............

	

  YES	

NO

	 4.	 Is the employee of the taxpayer an individual with an ownership interest in the business, that
individual’s spouse or dependent, or that individual’s ancestor or descendant?........................................

	

  YES	

NO

Note:	 If the answer to any of the above questions is “YES,” do not complete the rest of this form. The taxpayer does not qualify for
this tax credit. Otherwise, complete questions 5 and 6 and go to Part II.
	 5.	 Enter the address of the qualifying location of the new or expanded operations.  
		
	 6.	 Enter the date when the new or expanded operation began at the qualifying location.  

Part II	
	

Qualifying Employee Information
Enter the required information for each of the taxpayer’s qualifying employees reported in Part III of this tax
credit form. (If more space is needed, include a rider with the additional qualifying employee’s information).

Social Security Number

Name

Employment Dates
From

a.
b.
c.
d.
e.

Part III	

Calculation of the Economic Recovery Tax Credit

	 7.	 Enter the number of new full-time positions at the location in credit year one  
x $2,500..................................................................................................................

7.

	 8.	 Enter the number of new full-time positions at the location in credit year two  
x $1,250..................................................................................................................

8.

	 9.	 Economic Recovery Tax Credit carried over from prior year..............................................................

9.

	10.	 Total credit available (add lines 7, 8, and 9).......................................................................................

10.

Part IV	
		

Calculation of the Allowable Credit Amount and Carryover
(Combined return filers DO NOT complete Part IV. Continue with Part V.)

	11.	 Enter the tax liability from page 1, line 2a of CBT-100 or CBT-100S..................................................

11.

	12.	 Enter the required minimum tax liability (see instructions)......................................................................

12.

	13.	 Subtract line 12 from line 11...............................................................................................................

13.

	14.	 Enter 50% of the tax liability reported on line 11.................................................................................

14.

	15.	 Enter the lesser of line 13 or line 14...................................................................................................

15.

To

Name as Shown on Return

Part IV	

Federal ID Number

Unitary ID Number, if applicable

NU

Calculation of the Allowable Credit Amount and Carryover (Continued)

	16.	 Other tax credits used by taxpayer on current year’s return (see instructions):
	

(a)

	

	

(b)

	

	

(c)

	

	

(d)

	

......................................... Total

16.

	17.	 Subtract line 16 from line 15. If zero or less, enter zero....................................................................

17.

	18.	 Allowable credit for the current tax period. Enter the lesser of line 10 or line 17 here and on
Schedule A-3, Part I of the CBT-100 or CBT-100S............................................................................

18.

19.	 Amount of credit carryover to following year’s return (subtract line 18 from line 10).........................

19.

Part V	

Calculation of Allowable Credit Amount – Combined Return Filers ONLY

Section A – ALL Combined Return Filers
	20.	 Enter the group tax liability from Schedule A, Section II, Part III, line 4a, column (c) of CBT-100U....

20.

	21.	 Enter the aggregate minimum tax of combined group members (see instructions).................................

21.

	22.	 Subtract line 22 from line 21................................................................................................................

22.

	23.	 Enter 50% of the tax liability reported on line 20.................................................................................

23.

	24.	 Enter the lesser of line 22 or line 23....................................................................................................

24.

	25.	 Other tax credits used by combined group on current year’s return (see instructions):
	

	

(a)

	

(b)

	

	

(c)

	

	

(d)

	

..........................................Total

25.

	26.	 Subtract line 25 from line 24. If zero or less, enter zero......................................................................

26.

	27.	 Allowable credit for the current tax period. Enter the lesser of line 10 or line 26. If sharing, also
enter in the member’s column of Schedule A-3, Part I of the CBT-100U............................................

27.

If SHARING credit, complete line 28.
If NOT sharing credit, skip line 28 and complete Section B.
	28.	 Amount of credit carryover to following year’s return (subtract line 27 from line 10)...........................

28.

Section B – Combined Return Filers NOT Sharing Credit
	29.	 a)	 Enter combined group tax liability from line 20............................. 29a.
		 b)	 Divide line 29a by the combined group allocation factor from
Schedule J, line 9......................................................................... 29b.
		 c)	 Member’s share of combined group tax liability – Multiply line 29b by member’s allocation factor
from Schedule J, line 9...................................................................................................................

29c.

	30.	 Required minimum tax liability.............................................................................................................

30.

	31.	 Subtract line 30 from line 29c..............................................................................................................

31.

	32.	 Enter 50% of the tax liability reported on line 29c...............................................................................

32.

	33.	 Enter the lesser of line 31 or line 32....................................................................................................

33.

	34.	 Other tax credits used by taxpayer on current year’s return (see instructions):
	

(a)

	

	

(b)

	

	

(c)

	

	

(d)

	

........................................Total

34.

	35.	 Subtract line 34 from line 33. If zero or less, enter zero......................................................................

35.

	36.	 Allowable credit for the current tax period. Enter the lesser of line 27 or line 35 here and in the
member’s column of Schedule A-3, Part I of the CBT-100U...............................................................

36.

	37.	 Amount of credit carryover to following year’s return (subtract line 36 from line 10)..........................

37.

2,000

Instructions for Form 313
Economic Recovery Tax Credit
The purpose of the Economic Recovery Tax Credit is to foster business investment in qualified municipalities established under the authority of the “qualified Municipality Open For Business Incentive Program.” A taxpayer that is engaged in the conduct of business within a qualified municipality and is not receiving a benefit under the New Jersey Urban Enterprise Zones
Act, P.L.1983, c.303 (C.52:27h-60 et seq.) may apply to receive a tax credit against the amount of tax otherwise imposed
under the Corporation Business Tax Act (1945), P.L.1945, c.162 (C.54:10A-1 et seq.) equal to $2,500 for each new full-time
position at that location in credit year one and $1,250 for each new full-time position at that location in credit year two. No
taxpayer shall be allowed more than a single 24-month continuous period in which credits shall be allowed for activity at a
location within a qualified municipality. The amount of this credit in addition to the amount of any other tax credits is limited to
50% of the taxpayer’s total tax liability and cannot exceed an amount that would reduce the total tax liability below the statutory minimum. If the taxpayer claims this credit on Form CBT-100, CBT-100U, or CBT-100S, a completed Form 313 must be
included with the return to validate the claim.
Any unused credit may be carried forward, if necessary, for use in the five privilege periods following the privilege period
for which the credit is allowed. The credit allowed for credit year one may be refundable at the close of the privilege period
in which or with which credit year two ends. That amount of the credit received for credit year one remaining, if any, after
the liabilities for the privilege period in which or with which credit year two ends and for any prior privilege period have been
satisfied, multiplied by the sustained effort ratio, shall be an overpayment for the purposes of section R.S.54:49-15 for the
privilege period in which or with which credit year two ends; that amount of the credit received for credit year one remaining,
if any, that is not an overpayment may be carried forward.
Parts IV and V are used to calculate the allowable credit and carryover. Taxpayers filing Forms CBT-100 or CBT-100S complete Part IV and CBT-100U filers complete Part V.

Definitions

Credit year one means the first twelve calendar months following the initial or expanded operations at a location within
a qualified municipality.
Credit year two means the twelve calendar months following credit year one.
Employee of the taxpayer does not include an individual
with an ownership interest in the business, that individual’s
spouse or dependents, or that individual’s ancestors or
descendants.
Full-time position means a position filled by an employee
of the taxpayer for at least 140 hours per month on a permanent basis, which does not include employment that is
temporary or seasonal.
New full-time position means a position that did not exist
prior to credit year one. New full-time positions shall be
measured by the increase, from the twelve month period
preceding credit year one to the measured credit year, in the
average number of full-time positions and full-time position
equivalents employed by the taxpayer at the location within a
qualified municipality. The hours of employees filling parttime positions shall be aggregated to determine the number
of full-time position equivalents.
Part-time position means a position filled by an employee
of the taxpayer for at least 20 hours per week for at least 3
months during the credit year.
Sustained effort ratio means the proportion that the credit
year two new full-time positions bear to the credit year one
new full-time positions, not to exceed one.

Combined Return Filers

If filing a combined return, the form must be completed by
the member that earned the credit. All combined return filers
must check the combined return filers box at the top of the
form and complete Part V, Section A.
Members Opting Not to Share. In general, tax credits are
earned by a member of the combined group and are shareable with the combined group. However, members are not
required to share their credits. See N.J.S.A. 54:10A-4.6.i and
TB-90(R), Tax Credits and Combined Returns. In addition
to Section A, members that choose not to share must also
complete Part V, Section B and fill in the oval at the top of
the form to indicate they are not sharing the credit.
Taxpayers must include the appropriate credit form
in the year the credit was earned even if they are
not claiming the credit on their tax return.

Part I – Taxpayer and Employee Preliminary
Qualification

Questions 1 through 4 pertain to the taxpayer and the
employee qualifications that must be met prior to taking the
Economic Recovery Tax Credit. If the answer to any of these
questions is “YES,” the taxpayer is not eligible to take this
tax credit. If the answer to all of the questions is “NO,” the
taxpayer must first fill in line items 5 and 6, and then complete the balance of the form computing the amount of tax
credit that is allowed to be taken on the current tax return.

Part II – Qualifying Employee Information

Complete the information requested for each qualifying
employee entered in Part III of this form. Include a rider if
additional space is required.

Part III – Calculation of the Economic Recovery
Tax Credit
The tax credit is computed in this section, and is equal
to $2,500 for each new full-time position at the qualified
location in credit year one and $1,250 for each new full-time
position at the location in credit year two.
Line 7 – Enter the information for line 7 on the form filed for
credit year one only.
Line 8 – Enter the information for line 8 on the form filed for
credit year two only.

Part IV – Calculation of the Allowable Credit
Amount and Carryover (for CBT-100 and
CBT-100S Filers only)

For CBT-100 and CBT-100S filers, the allowable Economic
Recovery Tax Credit for the current period is calculated in
Part IV. Combined return filers do not complete Part IV, and
must complete Part V instead. The amount of this credit in
addition to the amount of any other tax credits taken cannot
exceed 50% of the tax liability otherwise due and cannot
reduce the liability to an amount less than the statutory minimum.
Line 12 – The minimum tax is assessed based on the New
Jersey Gross Receipts as follows:
New Jersey Gross Receipts
Less than $100,000	

CBT-100
$ 500

CBT-100S
$ 375

$100,000 or more but less than $250,000

750

562

$250,000 or more but less than $500,000

1,000

750

$500,000 or more but less than $1,000,000

1,500

1,000

$1,000,000 or more

2,000

1,500

If a taxpayer is filing a separate return and is a member of
an affiliated or controlled group that has a total payroll of
$5,000,000 or more for the return period, the minimum tax
is $2,000. Tax periods of less than 12 months are subject to
the higher minimum tax if the prorated total payroll exceeds
$416,667 per month.
Line 16 – Taxpayers claiming multiple credits must list any
credits already applied to the tax liability to ensure accuracy
of the calculation for maximum credit allowable.

Part V – Calculation of the Allowable Credit
Amount and Carryover for Combined Return
Filers

For CBT-100U filers, the total and allowable Economic Recovery Tax Credit for the current year is calculated in Part V.
All combined return filers must complete Section A. Members that choose not to share their credit must also complete
Section B.

Section A – To be completed by ALL combined return
filers
This section calculates the amount of credit allowable for the
group. If a member chooses not to share their credit with the
group, Section A must still be completed to ensure the credit
allowed for the member does not exceed the amount that
would otherwise be allowed against the group tax liability.
The amount of the credit calculated in this section cannot exceed 50% of the group tax liability otherwise due and cannot
reduce the tax liability to an amount less than the aggregate
statutory minimum tax of the group members.
Line 21 – Multiply the number of taxable group members by
$2,000 and enter the result.
Line 25 – Combined groups claiming multiple credits must
list any credits already applied to the group tax liability
to ensure accuracy of the calculation for maximum credit
allowable.
Section B
This section is used to calculate the amount of credit allowable for members that choose not to share their credit with
the group. Section B is completed based on the member’s
share of the group tax liability. The amount of the credit calculated in this section cannot exceed 50% of the member’s
tax liability otherwise due and cannot reduce the tax liability
to an amount less than $2,000. The amount of the credit is
also limited to the amount that would otherwise be allowed
against the group tax liability if the member had been sharing
the credit.
Line 34 – Members claiming multiple credits must list any
credits already applied to the member’s tax liability to ensure
accuracy of the calculation for maximum credit allowable.