54:10A-5.7. Determination of aggregate annual credit allowed

4. a. The aggregate annual credit allowed for a tax year shall be an amount equal to the sum of:

(1) The one-fifth part allowed under section 3 for qualified investment placed into service or use during a prior tax year, plus

(2) The one-fifth part allowed under section 3 for qualified investment placed into service or use during the current tax year.

b. (1) The amount determined under subsection a. shall be allowed as a credit against that portion of the taxpayer's corporation business tax liability which is attributable to and the direct result of the taxpayer's qualified investment. The amount determined under subsection a. and allowed as a credit against the tax imposed pursuant to section 5 of P.L.1945, c.162, for a tax year shall not reduce that tax liability by more than 50% of that portion of the taxpayer's tax liability otherwise due for the tax year which is attributable to and the direct result of the taxpayer's qualified investment and shall not reduce the tax liability for the tax year to an amount less than the statutory minimum provided in subsection (e) of section 5 of P.L.1945, c.162.

(2) If any amount of credit determined under subsection a. remains after the amount allowed as a credit under the limitations of paragraph (1) of this subsection, that amount of credit remaining shall be refunded to the taxpayer. The amount refunded to the taxpayer shall not exceed 50% of the sum of the amount of property taxes timely paid in the taxable year pursuant to R.S.54:4-1 et seq. and the amount of implicit property taxes paid through rent or lease payments in respect of property taxable pursuant to R.S.54:4-1 et seq., and for which taxes another party that is not a related person is liable, which is attributable to and the direct result of the taxpayer's qualified investment.

c. (1) If the taxes due under section 5 of P.L.1945, c.162 (determined before application of allowable credits against the tax), the sum of the amount of property taxes timely paid in the taxable year pursuant to R.S.54:4-1 et seq. and the amount of implicit property taxes paid through rent or lease payments in respect of property taxable pursuant to R.S.54:4-1 et seq., and for which taxes another party that is not a related person is liable, are not solely attributable to and the direct result of the taxpayer's qualified investment, the amount of those taxes which are so attributable shall be determined by multiplying the amount of taxes due under those acts for the tax year (determined before application of allowable credits against tax) by a fraction, the numerator of which is all compensation paid during the tax year to all employees of the taxpayer employed in this State whose positions are directly attributable to the qualified investment. The denominator of the fraction is the compensation paid during the taxable year to all employees of the taxpayer employed in this State.

(2) Any credits allowable under section 42 of P.L.1987, c.102 (C.54:10A-5.3), section 19 of P.L.1983, c.303 (C.52:27H-78), and section 12 of P.L.1985, c.227 (C.55:19-13), shall be applied against and reduce only the amount of corporation business tax not apportioned to the qualified investment under this act. Provided, that any excess of those credits may be applied against the amount of corporation business tax apportioned to the qualified investment under this act that is not offset by the amount of annual credit against the tax allowed under this act for the tax year, unless their application is otherwise prohibited by P.L.1987, c.102, P.L.1983, c.303, or P.L.1985, c.227.

(3) If any credit for the tax year pursuant to this section remains after application of the provisions of subsections a. and b. of this section, the amount thereof shall be forfeited. No carryover to a subsequent tax year or carryback to a prior tax year shall be allowed for the amount of any unused portion of any annual credit allowance.

d. For the purposes of this act, "implicit property taxes" means 15% of the amount of the rent or lease payments made by the taxpayer in respect of property taxable pursuant to R.S.54:4-1 et seq., and for which taxes another party that is not a related person is liable.

L.1993,c.170,s.4.