NEW JERSEY DIVISION OF TAXATION 
                             REGULATORY SERVICES BRANCH                   
                                    TECHNICAL BULLETIN 
______________________________________________________________________________  
 
TB – 79(R)                                                                ISSUED: 8-13-15 
 
TAX:          CORPORATION BUSINESS TAX 
 
TOPIC:        NEXUS FOR CORPORATION BUSINESS TAX   
 
This Technical Bulletin provides general guidelines for determining whether the activities of a 
corporation create nexus with New Jersey for the purposes of imposing the corporation business tax.  
 
Corporation Business Tax Nexus 
 
The New Jersey Corporation Business Tax Act requires every domestic or nonresident corporation to 
pay an annual franchise tax for the following privileges: 
 
 1. Having or exercising its corporate franchise in this State; 
      
 2. Deriving receipts from sources within this State;   
        
 3. Engaging in contacts within this State;   
        
 4. Doing business, having employees, owning capital or property, or maintaining an office in this 
     State.   
 
A foreign corporation has a corporate franchise in this State if:  
 
1.   It has registered with the New Jersey Department of Revenue; and/or 
      
2.   Holds a certificate, license, or other authorization issued by any other State department or  
     agency authorizing the company to engage in corporate activity in this State.   
   
In determining whether a corporation is doing business in New Jersey, consideration is given to such 
factors as: 
 
    1. The nature and extent of the activities of the corporation in New Jersey; 
     
    2. The location of its offices and other places of business; 
     

     3. The continuity, frequency, and regularity of the activities of the corporation in New Jersey; 
 
     4. The employment in New Jersey of agents, officers, and employees;  
      
     5. The location of the actual seat of management or control of the corporation.  
 
Public Law 86-272. The Federal Interstate Income Act, Title 15 U.S.C.A. Section 381, “Public Law 
86-272,” prohibits a state from imposing a net income based tax on income of a foreign corporation 
earned within its borders from interstate commerce, if the corporation’s only business activity within 
the state consists of the solicitation of orders by the corporation or its representatives of tangible 
personal property, the orders are sent outside the state for approval and, if approved, are filled by 
shipment or delivery from a point outside the state.  
 
A foreign corporation that conducts business activity in New Jersey that exceeds the protection of 
Public Law 86-272 is subject to the corporation business tax as measured by the net income of the 
corporation. Even though a corporation’s activities may be protected by Public Law 86-272, if it is 
registered or otherwise has nexus in New Jersey, it is subject to the corporation business tax 
minimum tax and must file a corporation business tax return.        
 
In-State activities by a corporation that create nexus for corporation business tax purposes and which 
are outside the protection of Public Law 86-272 include, but are not limited to: 
 
1.  Repairs, maintenance, and installations; 
 
2.  Collection or repossession activities; 
 
3. Credit investigations; 
 
4.  Conducting training courses, seminars, or lectures for personnel (other than for personnel 
     involved only in solicitation); 
 
5.  Providing technical assistance;  
 
6.  Resolving customer complaints for a purpose other than to ingratiate sales personnel with the 
     customer; 
 
7.  Approving or accepting orders or securing deposits on sales; 
 
8.  Acquiring personnel for purposes other than solicitation activities; 
 
9. Maintaining a display at a single location within New Jersey in excess of two weeks during the 
     tax year; 
 
10. Carrying samples for sale, exchange, or distribution in any manner for consideration or other 
     value;  

TB 79(R):‐ Nexus for Corporation Business Tax  

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11. Picking up or replacing damaged or returned property; 
 
12. Owning, leasing, or maintaining in-State facilities such as a warehouse or telephone answering 
     service;  
 
13. Consigning tangible personal property. 
 
Further Information 
 
Information about the corporation business tax is available on the Division of Taxation website 
at http://www.state.nj.us/treasury/taxation/corp.shtml 
 
Note: A Technical Bulletin is an informational document that provides guidance on a topic of 
interest to taxpayers and may describe recent changes to the relevant laws, regulations, and/or 
Division policies. It is accurate as of the date issued. However, taxpayers should be aware that 
subsequent changes to applicable laws, regulations, and/or the Division’s interpretation thereof 
may affect the accuracy of a Technical Bulletin. The information provided in this document does 
not cover every situation and is not intended to replace the law or change its meaning. 

TB 79(R):‐ Nexus for Corporation Business Tax  

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