 | Revision to Division Policy on Combined Groups and P.L. 86-272 Since the publication of these instructions, the Division has revised its policy on the treatment of members of a combined group that are claiming P.L. 86-272. For information, see notice. |
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CBT-100U
State of New Jersey
Division of Taxation Corporation Business Tax
Instructions for Corporation Business Tax Unitary Return
(Form CBT-100U – 2021)
interest. Compliance with N.J.S.A. 54:50-13 is also required in
Electronic Filing Mandate the case of certain mergers, consolidations, and dissolutions.
All Corporation Business Tax returns and payments must be
made electronically. This mandate includes all returns, esti-
mated payments, extensions, and vouchers. Visit the Division’s Distortion of Net Income
website or check with your software provider to see if they sup- The Director is authorized to adjust and redetermine items of
port any or all of these filings. gross receipts and expenses as may be necessary to make
a fair and reasonable determination of tax payable under the
Note: Form CBT-100U must be filed electronically even if one Corporation Business Tax Act. For details regarding the condi-
or more members of the combined group is a banking tions under which this authority may be exercised, see regula-
corporation or financial business corporation. tion N.J.A.C. 18:7-5.10.
This is the last year that Form CBT-100U will exist Accounting Method
in this format. It will be replaced with the new stan- The return must be completed using the same method of ac-
dardized return (Form CBT-1) next year. counting, cash, accrual or other basis, that was used on the
federal income tax return. If a federal income tax return was
not filed, use the same accounting method that would have
been used if a federal return was filed.
Before You Begin
Read all instructions carefully before completing returns. Note: Members that only use I.F.R.S. as their method of ac-
counting can use I.F.R.S. when reporting their income;
Include a complete copy of the federal Form 1120 (or any however, the member must include a rider noting the
other federal corporate return) that was filed with the fed- potential differences, if any, from the rest of the group.
eral government for (or on behalf of) each member of the com-
bined group, and include all related forms and schedules that Riders
were filed as part of the full and complete federal return of the If space is insufficient, include riders as PDFs in the same form
member. For more information, see TB-98(R), Federal Return as the original printed sheets. The riders must be numbered
and the Forms and Schedules to Include with the Corporation and clearly list the schedule(s) and line(s) of each correspond-
Business Tax Return Pursuant to P.L. 2020, C. 118. ing rider item.
Managerial Member Responsibilities Federal/State Tax Agreement
The managerial member acts as the agent on behalf of the The New Jersey Division of Taxation and the Internal Revenue
combined group. The managerial member is required to ad- Service participate in a federal/State program for the mutual ex-
dress all tax matters including, but not limited to: filing and change of tax information to verify the accuracy and consistency
amending tax returns, filing extensions, and making estimated of information reported on federal and New Jersey tax returns.
tax payments and/or any tax liability payment on behalf of its
taxable members. The managerial member is also responsible
for responding to notices and assessments for its combined Mandatory Combined Reporting
group. (N.J.S.A. 54:10A-4.10) For group privilege periods ending on and after July 31, 2019,
members that are part of a combined group must file a com-
The managerial member of the combined group must register bined New Jersey return, Form CBT-100U. Combined returns
the group in order to file the combined return. Information on are mandatory, not elective.
managerial member registration is available on the Division’s
website.
Definitions
Combined group is a group of companies that have common
Personal Liability of Officers and Directors ownership and are engaged in a unitary business, and at least
Even though the managerial member is responsible for mak- one company is subject to tax under this chapter. It includes
ing payments on behalf of the combined group, each taxable all business entities except as provided for under any section
member is jointly and severally liable for the tax due. In addi- of the Corporation Business Tax Act (1945), P.L.1945, c.162
tion, any officer or director of any corporation who shall dis- (C.54:10A-1 et seq.). See N.J.S.A. 54:10A-4(z).
tribute or cause to be distributed any assets in dissolution or
liquidation to the stockholders without having first paid all cor- For privilege periods ending on and after July 31, 2020, a
poration franchise taxes, fees, penalties, and interest imposed combined group is treated as one taxpayer for purposes of
on said corporation, in accordance with N.J.S.A. 14A:6-12, paragraph (1) of subsection (c) of section 5 of P.L.1945, c.162
N.J.S.A. 54:50-18 and other applicable provisions of law, shall (C.54:10A-5) and section 1 of P.L. 2018, c.48 (C.54:10A-5.41)
be personally liable for said unpaid taxes, fees, penalties, and for the income derived from the unitary business.
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Note: Pursuant to N.J.S.A. 54:10A-4(h) a combined group is a Elective World-Wide Group Election. When making a world-
taxpayer for the purposes of the Corporation Business wide group election, the combined group must include all of the
Tax Act. income, attributes, and allocation factors of all of the worldwide
business entities that are members of the unitary combined
Common ownership means that more than 50% of the vot- group, regardless of whether such members filed a federal tax
ing control of each member of a combined group is directly or return or whether such members filed a federal consolidated
indirectly owned by a common owner or owners, either corpo- return(s).
rate or noncorporate, whether or not the owner or owners are
members of the combined group. Whether voting control is in- Elective Affiliated Group Election. For the purposes of the
directly owned shall be determined in accordance with section affiliated group election, “affiliated group” is defined pursuant to
318 of the federal Internal Revenue Code, 26 U.S.C. s.318. N.J.S.A. 54:10A-4(x). Only business entities that are U.S. do-
See: N.J.S.A. 54:10A-4(aa). The Division interprets N.J.S.A. mestic corporations (as defined in N.J.S.A. 54:10A-4(x)) for the
54:10A-4(aa) to mean that all of the ownership rules, including purposes of the definition can be included in the affiliated group
the beneficial and constructive ownership rules of I.R.C. sec- return. Non-U.S. corporations that do not file a federal return
tion 318 apply since the definition of common ownership states cannot be included in a New Jersey affiliated group combined
that the control can be direct or indirect. return.
Managerial member is the common parent corporation if that Note: In most cases, the New Jersey affiliated group com-
corporation is a taxable member. If the common parent corpo- bined return constitutes the multinational corporation’s
ration is not a taxable member, the group must select a taxable entire U.S. footprint.
member to be its managerial member or, at the discretion of
the Director or upon failure of the combined group to select its The sole U.S. domestic corporation in a world-wide combined
managerial member, the Director will designate a taxable mem- group cannot make the affiliated group election on its own. In
ber of the combined group as managerial member. this situation, the combined group must file a water’s-edge or
world-wide group combined return.
Member is a business entity that is a part of a combined group,
unless otherwise excluded. See “Corporations Required to An affiliated group election by the U.S. domestic corporations
File” for more information. does not relieve the non-U.S. corporations of their New Jersey
Corporation Business Tax liability. Thus, a non-U.S. corporation
Taxable member is a member that is subject to tax pursuant organized outside the United States that does not file a federal
to the Corporation Business Tax Act (1945), P.L.1945, c.162 return, but has nexus with New Jersey, must still file a separate
(C.54:10A-1 et seq.). See N.J.S.A. 54:10A-4(ff). New Jersey Corporation Business Tax return.
Nontaxable member is a member that is not subject to tax. Allocation Methods for Combined Returns
See N.J.S.A. 54:10A-4(ee). The two methods available to allocate the income of a com-
bined group are “Joyce” and “Finnigan.” These methods are
Unitary business is a single economic enterprise that is made differentiated by their determination of the allocation factor.
up either of separate parts of a single business entity or of a Under either method, the allocation factor attributes included
group of business entities under common ownership that are in the denominator are the same. The denominator includes all
sufficiently interdependent, integrated, and interrelated through of the combined group’s total factors, regardless of nexus. See
their activities so as to provide a synergy and mutual benefit Schedule J instructions for more information.
that produces a sharing or exchange of value among them and
a significant flow of value among the separate parts. A unitary
business shall be construed to the broadest extent permitted Nexus
Each member that has nexus with New Jersey is subject to
under the Constitution of the United States. See N.J.S.A. the $2,000 minimum tax. A member of a combined group has
54:10A-4(gg) and TB-93, The Unitary Business Principle and nexus if the member meets the standards of N.J.S.A. 54:10A-2
Combined Returns, for more information and the full definition as either part of the unitary business of the combined group
of a unitary business for the purposes of combined reporting. or independent of the combined group. If a member does not
have nexus with New Jersey, the member is not subject to the
Combined Return Filing Methods minimum tax. If one member in the combined group has nexus
A combined return is a filing method for a group of business and sufficient activities in New Jersey to be taxed based on
entities in a unitary business. Determining the combined group income, no member that has nexus with New Jersey can claim
members involves imposing certain statutory limitations, which P.L. 86-272 protection.
affect the treatment of income, allocation factors, and tax attri-
butes. This decision is commonly referred to as “world-wide vs. Note: A taxpayer that is not in a unitary business relationship
water’s-edge.” As an alternative, there is an option to file the with a combined group must file a separate return if the
New Jersey combined return as an “affiliated group” as defined taxpayer has nexus with New Jersey and the manage-
by statute. Information is available in TB-89(R), Combined rial member of the combined return does not make the
Group Filing Methods. election to file the affiliated group combined return.
Mandatory Default Water’s-Edge Group Basis returns in-
clude only entities with significant business operations within
the United States, with several inclusions and exceptions. This Corporations Required to File
If one member of a combined group has nexus, the combined
is the mandatory default filing method. Combined report- group must file a New Jersey combined return.
ing is not elective. See N.J.S.A. 54:10A-4.8; N.J.S.A. 54:10A-
4.10; N.J.S.A. 54:10A-4.11; and TB-89(R) for more information
on the entities that are statutorily required to be included.
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In general, every corporation existing under the laws of the a CBT-100S for the privilege periods that the New Jersey S
State of New Jersey is required to file a Corporation Business corporation elects to be a member of the combined group. See
Tax return. GIT-9S, Income From S Corporations for more information on
hybrid corporations.
A foreign corporation has nexus if that foreign corporation:
1. Holds a general certificate of authority to do business in this Domestic International Sales Corporations (DISC). A DISC
State issued by the Secretary of State; or must complete this return as though no election had been
made under Sections 992-999 of the Internal Revenue Code. A
2. Holds a certificate, license, or other authorization issued DISC must complete all applicable schedules on the return.
by any other department or agency of this State, authoriz-
ing the company to engage in corporate activity within this Combinable Captive Insurance Companies. Combinable
State; or captive insurance companies are no longer exempt from the
3. Derives income from this State; or Corporation Business Tax.
4. Employs or owns capital in this State; or
Note: A regular captive insurance company that does not
5. Employs or owns property in this State; or
meet the definition of a combinable captive insurance
6. Maintains an office in this State. company in N.J.S.A. 54:10A-4(y) is still exempt from the
Corporation Business Tax.
Foreign corporations see N.J.A.C. 18:7-1.6; N.J.A.C. 18:7-
1.8; N.J.A.C. 18:7-1.9; N.J.A.C. 18:7-1.10; N.J.A.C. 18:7-1.11; Foreign Sales Corporations (FSC).An FSC must complete
N.J.A.C. 18:7-1.14 and TB-79(R), Nexus for Corporation Busi- this return as though no election had been made under Sec-
ness Tax, for more information on nexus. tions 922-927 of the Internal Revenue Code. FSCs must com-
plete all applicable schedules on the return. Under Section 5,
A foreign corporation that is a partner of a New Jersey partner- P.L. 106-519, no corporation may elect to be an FSC after
ship is deemed subject to tax in the State and must file a return. September 30, 2000.
Corporations Claiming P.L. 86-272. If the entire combined Financial Business Corporations. Corporations that qualify
group is claiming immunity from tax pursuant to P.L. 86-272, as financial businesses, those that derive 75% of their gross in-
each member must complete Schedule N, Nexus – Immune come from the financial activities enumerated at N.J.A.C. 18:7-
Activity Declaration and the Nexus Questionnaire. In addition 1.16(a)1 through (a)7, must use Schedule A-7 as a worksheet
the combined group must complete page 1, the Members and and keep with their records. It does not need to be included
Affiliates Schedule, the Annual General Questionnaire, and with the return. Schedule A-7 is available on the Division’s
Schedules A, A-2, A-3, and A-4. Payment for the related min- website. The combined return must be filed electronically even
imum tax liability and the installment payment (if applicable) if one or more members of the combined group is a financial
must be submitted. P.L. 86-272 filers are not subject to the sur- business corporation.
tax imposed by N.J.S.A. 54:10A-5.41.
Banking Corporations. A banking corporation filing as part
Note: If one member in the combined group has nexus and of a combined group that uses a fiscal year basis must align
sufficient activities in New Jersey to be taxed based on its privilege period with the combined group. For more infor-
income, no member that has nexus with New Jersey mation, see TB-91, Banking Corporations and Combined Re-
can claim P.L. 86-272 protection. Check the box on turns. The combined return must be filed electronically even
page 1 to indicate the entire combined group is claiming if one or more members of the combined group is a banking
P.L. 86-272. corporation.
New Corporations. Every New Jersey corporation acquires a Professional Corporations. Corporations formed under
taxable status beginning 1) on the date of its incorporation, or N.J.S.A. 14A:17-1 et seq. or any similar laws of a possession
2) on the first day of the month following its incorporation if so or territory of the U.S., a state, or political subdivision thereof,
stated in its certificate of incorporation. Every corporation that must complete Schedule PC. Examples of licensed profes-
incorporates, qualifies or otherwise acquires a taxable status in sionals include certified public accountants, architects, optom-
New Jersey must file a Corporation Business Tax return. etrists, professional engineers, land surveyors, land planners,
chiropractors, physical therapists, registered professional
S Corporations. Federal S corporations that have not elected nurses, dentists, osteopaths, physicians and surgeons, doctors
and been authorized to be New Jersey S corporations must of medicine, doctors of dentistry, podiatrists, veterinarians, and
complete this return as though no election had been made attorneys.
underI.R.C. § 1362. A copy of Form 1120-S as filed must
be submitted. Lines 1 through 28 in Part I, Schedule A of the Inactive Corporations. Inactive corporations that, during the
CBT-100U must be completed. period covered by the return, did not conduct any business, did
not have any income, receipts or expenses, and did not own
New Jersey S Corporations. New Jersey S corporations any assets must complete Schedule I – Certificate of Inactivity
that elect to be included as a member on the combined re- in addition to page 1, the Members and Affiliates Schedule,
turn will be taxed in the same manner as the other members the Annual General Questionnaire, and Schedules A, A-2,
of the combined group. A copy of Form 1120-S as filed must A-3, and A-4. Payment for the related minimum tax liability
be submitted. Lines 1 through 28 in Part I, Schedule A of the and the installment payment (if applicable) must be submitted
CBT-100U must be completed. A New Jersey S corporation electronically.
that elects to be included as a member on a New Jersey
Combined Return is treated in the same manner as a hybrid Portion of a Company’s Operations That are Nonunitary
corporation (i.e. a non-electing Federal S corporation that is With This Combined Group. There are instances when a
a C corporation for CBT purposes), and does not need to file
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portion of a member’s business operations are independent of • Limited Liability Companies (unless treated as partnerships
the unitary business activity of the combined group. Only the or disregarded entities for federal purposes)
income, attributes, and allocation factors related to the portion • Foreign Limited Liability Companies (unless treated as part-
of a company’s operations that are part of a unitary business nerships or disregarded entities for federal purposes)
of the combined group are included in the calculation of the
combined group’s entire net income and allocation factor. The • Federal S Corporations (that have not made a New Jersey
remaining portion of a member’s business operations may S Corporation election)
be subject to tax separately from the combined group if such • New Jersey S Corporations (that have elected to be in-
member individually conducts business in New Jersey or with cluded in the combined group)
another combined group (if it is engaged in a unitary business • Combinable Captive Insurance Companies
with that combined group that also conducts business in New • Qualified Subchapter S Subsidiaries (that have not made a
Jersey and files a CBT-100U). New Jersey S Corporation election)
Note: A combined group member with business operations • New Jersey Qualified Subchapter S Subsidiaries (that
that are independent of the unitary business activity of elected to be included in the combined group)
the combined group must report such income on Sched- • Professional Corporations
ule X. Schedule X will be used to calculate the New Jer- • Any other business entities however and/or wherever in-
sey taxable net income of that separate activity income corporated or formed that are treated as corporations for
that must be reported in Part III of Schedule A of the federal purposes except when excluded by statute or as
CBT-100U. Include a copy of Schedule X if completed. described below
See Schedule X instructions for more information.
Casino Licensees
See “Additional Forms and Instructions” for details on obtaining Pursuant to the Casino Control Act, any business conducted
Schedule X. by an individual, partnership, or corporation or any other entity,
or any combination thereof, holding a license in New Jersey
Former Member of Combined Group. A taxpayer that was is required to file a consolidated return. A consolidated return
a member of a combined group filing a New Jersey combined is similar to an affiliated group combined return. See N.J.S.A.
return for part of the group privilege period and subsequently 5:12-148. All Casino licensees are taxable members. The affili-
departs the combined group to file on a separate entity basis ated businesses that are unitary with the casino licensees must
must report the income for months subsequent to departing the also be included when completing CBT-100U.
combined group on a separate return (Form CBT-100) unless
the member joined a second combined group that files a New Disregarded Entities
Jersey combined return. The taxpayer filing a separate return A business entity that is treated as a disregarded entity for
would not report the income on CBT-100 for the months the federal income tax purposes is also treated as a disregarded
member was part a the combined group. Likewise, a taxpayer entity for New Jersey Corporation Business Tax purposes pur-
that joined a second combined group that files a New Jersey suant to N.J.S.A. 42:2C-92. Disregarded entities also include
combined return would only report on the second group’s legal partnerships that are disregarded entities for federal
return the income for the months the member was part of the purposes. A disregarded entity is not itself a member of a
second combined group. If determining what amount of income combined group. However, the tax attributes of a disregarded
is attributable to the portions of the 12-month period are for entity are reported by a member of a combined group when
the periods before and after departing a combined group, the the member owns the disregarded entity. The attributes of a
taxpayer must prorate their income/losses and receipts. disregarded entity owned by a member of a combined group
are included in the income and allocation factor of that mem-
Note: For a taxpayer that is a member of a combined group ber as well as the combined group. In making a determination
filing a New Jersey combined return and that member of which members are included in a water’s-edge combined
properly dissolved and received tax clearance during group pursuant to N.J.S.A. 54:10A-4.11, the disregarded enti-
the group privilege period, the income and tax liabilities ty’s attributes shall be used by the member that owns the disre-
of that member for the part of the group privilege period garded entity. A disregarded entity is not subject to the $2,000
the member existed prior to dissolution must be reported minimum tax as a member of a combined group because a
on the combined return. disregarded entity is not a member of the combined group.
However, if a disregarded entity is part of a unitary business of
Included and Excluded Entity Types a combined group, the owner of the disregarded entity will be
Not all business entities are included in a combined group. a member of the combined group and must be included as part
The lists below provide information on which entities are or are of the combined group except as otherwise excluded.
not included. Additional information is available in TB-86(R),
Included and Excluded Business Entities in a Combined Group Entities that File as Partnerships for Federal Purposes
and the Minimum Tax of a Taxpayer that is a Member of a Partnerships, limited partnerships, or limited liability compa-
Combined Group. nies treated as partnerships for federal purposes are business
entities that can be unitary with a combined group. However,
Included Entity Types these entities are not members of a combined group for New
• U.S. Corporations Jersey Corporation Business Tax purposes. Their income
• Foreign Corporations flows through to the corporate partners that are members of
• Casino Licensees the combined group. Partnerships, limited partnerships, and
limited liability companies that are treated as partnerships for
• Banking Corporations federal purposes are not subject to the $2,000 minimum tax as
• Financial Corporations members of a combined group because they are not members
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of the combined group. However, Form NJ-CBT-1065 must still is used for federal income tax purposes. The Division is aware
be filed. that taxpayers cannot properly input dates for 52-53 week ac-
counting years. In this case, taxpayers will need to contact the
Excluded Entity Types Division for assistance.
• New Jersey S Corporations that do not elect inclusion in the
combined group The combined group’s reporting period for the New Jersey
combined return is the same tax period that the managerial
• New Jersey Qualified Subchapter S Subsidiaries that do not member uses for federal purposes. Generally, this is the same
elect inclusion in the combined group privilege period as the federal consolidated return since in
• Captive Insurance Companies that do not meet the defini- most instances the managerial member is one of the members
tion of a Combinable Captive Insurance Company as de- included in the federal consolidated return. Any members that
fined in N.J.S.A. 54:10A-4(y) operate under a different return period must file a short-period
return to align their privilege periods with the group’s privilege
• All other insurance companies that are not Combinable period. This is done on a separate return. Affected mem-
Captive Insurance Companies bers must also fiscalize or annualize their income and attri-
• Corporations exempt from the Corporation Business Tax butes reported as part of the combined group. See N.J.S.A.
under N.J.S.A. 54:10A-3 54:10A-4.10.c and N.J.S.A. 54:10A-4.8.b.
• Corporations that are regulated, in whole or in part, by the
Extension of Time to File
Federal Energy Regulatory Commission, the New Jersey The Tentative Return and Application for Extension of Time to
Board of Public Utilities, or similar regulatory body of an- File, Form CBT-200-T, must be filed and paid electronically.
other state, with respect to rates charged to customers for You can also check with your software provider to see if the
electric or gas services and water and wastewater services software you use supports filing of extensions.
• Real Estate Investment Trusts
Combined groups filing Form CBT-100U will automatically re-
• Regulated Investment Companies ceive a six-month extension only if they have paid at least 90%
• Investment Companies of the tax liability and timely filed Form CBT-200-T.
A taxpayer that has nexus with New Jersey that is excluded An extension of time is granted only to file the New Jersey
from the New Jersey combined return must file a separate combined return. There is no extension of time to pay the tax
return. due. The Division will notify you only if we deny your extension
request, but not until after you actually file your return. Pen-
alties and interest are imposed whenever tax is paid after the
original due date.
When to File
2021 Accounting Periods and Due Dates Note: An extension payment must include any applicable pro-
The 2021 Corporation Business Tax return should only be fessional corporation (PC) fees and/or installment pay-
used for accounting periods ending on and after July 31, 2021, ments. See the online application for more information.
through June 30, 2022.
In general, the New Jersey Corporation Business Tax returns
and payments, except estimated payments, are due 30 days How to Pay
The managerial member acts as the agent on behalf of the
after the original due date of the federal corporate income tax combined group and is responsible for making payments on
return. For the administrative convenience of both the Division behalf of the group.
and taxpayers, Corporation Business Tax returns filed by the
15th day of the fifth month following the close of the privilege To make payments electronically, go to the Division of Taxa-
period are considered timely even if that date is more than 30 tion’s website. Managerial members who do not have access
days after the federal due date. If the due date falls on a week- to the internet can call the Division’s Customer Service Center
end or a legal holiday, the return and payment are due on the at (609) 292-6400.
following business day. Use the following schedule for 2021
CBT-100U forms and payments: If registered, payments can also be made by Electronic Funds
Transfer (EFT). For information or to enroll in the program, visit
If accounting July 31, Aug. 31, Sept. 30, Oct. 31, Nov. 30, Dec. 31, the Division of Revenue and Enterprise Services’ website, call
period ends on: 2021 2021 2021 2021 2021 2021
Due date for Dec. 15, Jan. 15, Feb. 15, Mar. 15, Apr. 15, May 15, (609) 292-9292 and select option #6, fax (609) 984-6681, or
filing is: 2021 2022 2022 2022 2022 2022 write to NJ Division of Revenue and Enterprise Services, EFT
If accounting Jan. 31, Feb. 28, Mar. 31, Apr. 30, May 31, June 30, Section, PO Box 191, Trenton, NJ 08646-0191.
period ends on: 2022 2022 2022 2022 2022 2022
Due date for June 15, July 15, Aug. 15, Sept. 15, Oct. 15, Nov. 15, Note: Managerial members that are required to remit pay-
filing is: 2022 2022 2022 2022 2022 2022
ments by EFT can satisfy the EFT requirement by mak-
A New Jersey combined return must be filed for the account- ing e-check or credit card payments.
ing period (calendar or fiscal, as applicable) of the managerial
member of the combined group, or part of the period, begin-
ning on the date the combined group acquired a taxable sta-
tus in New Jersey regardless of whether it had any assets or
conducted any business activities. All accounting periods must
end on the last day of the month, except that the managerial
member may use the same 52-53 week accounting year that
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than 5 years prior thereto, in which it shall have transacted
Penalties and Interest business in this State without a certificate of authority. N.J.S.A.
Each taxable member is jointly and severally liable for any
penalties and interest assessed. See N.J.S.A. 54:10A-4.8 14A:13-11(3).
and N.J.S.A. 54:10A-4.10.
Insufficiency Penalty. If the amount paid with the Tentative Amended Returns
Return, Form CBT-200-T, is less than 90% of the tax liability All CBT-100U amended returns must be submitted
computed on Form CBT-100U, or in the case of a combined electronically.
group with a preceding return covering a full 12-month period
that is less than the amount of the tax computed at the rates Final Determination of Net Income by Federal Government.
applicable to the current accounting year but on the basis of Any change or correction made by the Internal Revenue Ser-
the facts shown and the law applicable to the preceding ac- vice to the federal taxable income must be reported to the Divi-
counting year, the combined group may be liable for a penalty sion within 90 days.
of 5% per month or part of a month not to exceed 25% of the
amount of underpayment from the original due date to the date
of actual payment.
Page 1 Line-by-Line Instructions
Enter the unitary ID number, unitary group name, and complete
Late Filing Penalty. 5% per month or part of a month on the mailing address in the space provided on the return. Also pro-
amount of underpayment not to exceed 25% of that underpay- vide the managerial member’s FEIN, name, complete mailing
ment, except if no return has been filed within 30 days of the address, and contact information.
date on which the first notice of delinquency in filing the return
was sent, the penalty will accrue at 5% per month or part of a Check the box if this is an amended return.
month of the total tax liability not to exceed 25% of such tax
liability. Also, a penalty of $100 for each month the return is de- If filing an amended return, enter the applicable
linquent may be imposed. code in the boxes provided. If using code 10,
“Other,” enter the reason in the lines provided. If
Late Payment Penalty. 5% of the balance of tax due paid after more space is needed, include a rider.
the due date for filing the return may be imposed.
1. Change in allocation factor
Interest. 3% above the average predominant prime rate for 2. IRS audit
every month or part of a month the tax is unpaid, compounded 3. Amended federal 1120 filed
annually. At the end of each calendar year, any tax, penalties, 4. To take credit for payments/payments made by a
and interest remaining due will become part of the balance on partnership
which interest will be charged. The interest rates assessed by 5. Adjustments to ENI
the Division of Taxation are published online. 6. To change credit request to refund request or refund
request to credit request
Note: The average predominant prime rate is the rate as 7. Change in filing period
determined by the Board of Governors of the Federal 8. Change in tax credits reported
Reserve System, quoted by commercial banks to large 9. Adding or subtracting a combined return member
businesses on December 1st of the calendar year im- 10. Other
mediately preceding the calendar year in which payment
was due or as redetermined by the Director in accor- Check the box to indicate which filing method is being used.
dance with N.J.S.A. 54:48-2. A New Jersey combined return will default to a water’s-edge
group, unless the managerial member makes a world-wide or
Collection Fees. In addition, if the tax bill is sent to our collec- affiliated group election (N.J.S.A. 54:10A-4.11). The election
tion agency, a referral cost recovery fee of 11% of any tax, pen- must be made on a timely filed original combined return in the
alty, and interest due will be added to the liability in accordance privilege period it becomes effective. The world-wide group
with N.J.S.A. 54:49-12.3. If a certificate of debt is issued for the election and affiliated group election cannot be made at the
outstanding liability, a fee for the cost of collection of the tax same time, and the managerial member can only choose one
may also be imposed. election. The elections are binding for the privilege period of
the election plus five subsequent privilege periods. If filing on
Underpayment of Estimated Tax. To calculate the amount of an affiliated group or world-wide basis, indicate the number of
interest for the underpayment of estimated tax, complete either years into the election period of the combined group.
Form CBT-160-A or Form CBT-160-B. If the combined group
qualifies for any of the exceptions to the imposition of interest Check the box to indicate the entire combined group is claim-
for any of the installment payments, Part II must be completed ing P.L. 86-272. If one member in the combined group has
and submitted with the return as evidence of such exception. nexus and sufficient activities in New Jersey to be taxed based
on income, no member that has nexus with New Jersey can
Civil Fraud. If any part of an assessment is due to civil fraud, claim P.L. 86-272 protection.
there shall be added to the tax an amount equal to 50% of the
assessment in accordance with N.J.S.A. 54:49-9.1. If claiming P.L. 86-272, Schedule N, Nexus – Immune Activity
Declaration and the Nexus Questionaire, must be completed
Transacting Business Without a Certificate of Authority. In for each member. In addition the combined group must com-
addition to any other liabilities imposed by law, a foreign corpo- plete page 1, the Members and Affiliates Schedule, the Annual
ration that transacts business in this State without a certificate General Questionnaire, and Schedules A, A-2, A-3, and A-4.
of authority shall forfeit to the State a penalty of not less than Payment for the related minimum tax liability and the install-
$200, nor more than $1,000 for each calendar year, not more ment payment (if applicable) must be submitted. P.L. 86-272
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filers are not subject to the surtax imposed by N.J.S.A. Note: Professional corporation installment payments from the
54:10A-5.41. prior year may not be used to offset any current year tax
liability and are not eligible for refund.
Line 1 – Total Tax of Combined Group
Enter amount from line 5, column (a) of Schedule A, Part III. Line 10 – Payments Made by Partnerships
Include the total payments made by partnerships on behalf
Line 2 – Total Tax Credits Used by Combined Group of the members. Total the amounts reported in column 7 of
Enter amount from line 6, column (a) of Schedule A, Part III. Schedule P-1, Part I for all members. Submit copies of the
NJK-1s or K-1s (as applicable) reflecting payments made by
Line 3 – Total Combined Group CBT Tax Liability each partnership entity.
Enter amount from line 7, column (a) of Schedule A, Part III.
Line 11a – Total Refundable Tax Credits
Line 4 – Total Surtax of Combined Group Members Add the amounts from Schedule A-3, Part II, line 5 and Sched-
Enter amount from line 8, column (a) of Schedule A, Part III. ule A-3, Part II, line 6 and enter the total.
Line 5 – Total Combined Group Tax Due Line 11b – Total Refundable Tax Credits Refunded to
Enter amount from line 9b, column (a) of Schedule A, Part III. Members
Enter the amount from Schedule A-3, Part II, line 5. This
Line 6 – Installment Payments amount will be refunded to the managerial member, which is
The managerial member is required to make installment responsible for distributing to the appropriate group members.
payments of estimated tax on behalf of the combined group.
The requirement for making these payments is based on the Line 11c – Total Refundable Tax Credits Applied to Group
amount of the total tax liability shown on the most recent re- Enter the amount from Schedule A-3, Part II, line 6.
turn. Any payment not made under the NU number must be
transferred. Visit the Division’s website for more information. Line 12 – Total Payments and Credits
Add lines 9, 10, and 11c and enter the result.
• If the 2021 Total Tax Liability is greater than $500, the
managerial member must make installment payments to- Amount Due or Overpayment – Lines 13–18
ward 2022. These payments are to be made electronically Compare lines 12 and 8.
on Form CBT-150 and are due on or before the 15th day
of the 4th, 6th, 9th and 12th months of the tax year. If the • If line 12 is less than line 8, you have a balance due. Com-
combined group has gross receipts greater than or equal plete lines 13, 14, and 15.
to $50,000,000 must make installment payments on the • If line 12 is more than line 8, you have an overpayment.
15th day of the 4th, 6th, and 12th months of the tax year. Complete line 14 (if applicable) and lines 16 through 18.
Information on making these payments can be found on the
Division’s website. Line 13 – Balance of Tax Due
Subtract line 12 from 8 and enter the difference.
• If the 2021 Total Tax Liability is $500 or less, installment
payments may be made as indicated above OR in lieu of Line 14 – Penalty and Interest Due
making installment payments, the managerial member may Include any penalties and interest. See “Penalties and Interest”
make a payment of 50% of the 2021 total tax liability. For a for information.
combined group that qualifies and want to take advantage
of this option, enter on line 6, 50% of the amount on line 5. Note: If the group has an overpayment or no tax liability and
This will become part of the payment to be made with the has calculated penalties and interest due, such amounts
2021 return and installment payments will not be required. must be added to the balance due line or subtracted
This payment should be claimed as a credit when filing the from the overpayment.
2022 return. There are rare instances where tax credits can
take the combined group’s total tax liability below to $500 Line 15 – Total Balance Due
or less. The only way a combined group could use this esti- Enter the total of line 13 and line 14.
mated payment method is if it claims such tax credit(s).
Line 16 – Amount Overpaid
Line 7 – Professional Corporation Fees Subtract the sum of line 8 and line 14 (if applicable) from the
Enter amount from the combined group column of Sched- amount on line 12.
ule PC, line 9.
Line 17 – Refund
Line 8 – Total Tax and Professional Corporation Fees Enter the amount of the overpayment to be refunded. This
Enter the total of lines 5, 6, and 7. amount will be refunded to the managerial member.
Line 9 – Payments and Credits Line 18 – Credit to 2021
Include on this line: Enter the amount of the overpayment that you want to credit to
the 2021 combined group tax liability.
• Installment tax payments made for 2021;
• Amounts paid with tentative return (form CBT-200-T); Signature
Each return must be signed by an officer of the managerial
• Any overpayment from the preceding tax return that the member who is authorized to attest to the truth of the state-
taxpayer elected to have credited to the current year’s tax. ments contained therein and to acknowledge that they un-
Do not include any amount of the overpayment that the tax- derstand they are required to include copies of their federal
payer elected to have refunded;. return(s), forms, and schedules. The fact that an individual’s
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name is signed on the return shall be prima facie evidence that deductions. All data must match the federal return that was
such individual is authorized to sign the return on behalf of all filed or that would have been filed.
of the members of the combined group.
Note: Members that only use I.F.R.S. as their method of ac-
Tax preparers who fail to sign the return or provide their counting can use I.F.R.S. when reporting their income;
assigned tax identification number shall be liable for a $25 however, the member must include a rider noting the
penalty for each such failure. If the tax preparer is not self-em- potential differences, if any, from the rest of the group.
ployed, the name of the tax preparer’s employer and the
employer’s tax identification number should also be provided. Federal Consolidated Return Principles
In the case of a corporation in liquidation or in the hands of a Combined returns are not necessarily the same as a consoli-
receiver or trustee, certification shall be made by the person dated return, although they are similar. The principles set forth
responsible for the conduct of the affairs of such corporation. in the Treasury regulations promulgated under Section 1502
of the Internal Revenue Code generally apply to the extent
consistent with the New Jersey Corporation Business Tax Act
Members and Affiliates Schedule and the unitary business principle to a combined group filling
Enter the requested information for each member of the a New Jersey combined return. See N.J.S.A. 54:10A-4.6(h).
combined group. If necessary, include a rider detailing the re- However, for purposes of the New Jersey Corporation Busi-
quested information. This schedule is used, in part, to add and ness Tax Act, the starting point for taxable income is entire
remove members from the group. Any members included on net income before net operating losses and special deduc-
this schedule that were not included on the last CBT-100U that tions with several modifications for additions and deductions.
was filed will be added to the group. Likewise, any member See N.J.S.A. 54:10A-4.6.e; N.J.S.A. 54:10A-4(k); N.J.S.A.
that was included on the last CBT-100U but is not included on 54:10A-4(bb); and MCI Communication Services, Inc. v. Direc-
this schedule will be removed from the group. All members that tor Division of Taxation, Docket No. 013905-2010, (Tax Court
were part of the group for any part of the tax period must be of New Jersey 2015); affirmed 2018 N.J. Super. Unpub. LEXIS
included on this schedule. 1401; cert. denied 195 A.3d 528 (October 18, 2018).
For the purposes of applying I.R.C. § 163(j) and N.J.S.A.
54:10A-4(k)(2)(K), the members included in a New Jersey
Schedule A
The managerial member must complete this schedule for each combined return will be treated in the same manner as though
member. they filed a single federal consolidated return. This is true re-
gardless of whether the members of the New Jersey combined
return are on one federal consolidated return. See TB-87, Initial
Intercompany Eliminations
Enter member’s amounts in the member’s column. In column Guidance for Corporation Business Tax Filers and the IRC §
(c), enter the total amounts of all members prior to intercom- 163(j) Limitation, for more information.
pany eliminations and adjustments. In column (b), enter the in-
tercompany eliminations and adjustments. In column (a) enter Note: For the purposes of I.R.C. § 163(j), New Jersey follows
the total amounts for the combined group after intercompany the Coronavirus Aid, Relief, and Economic Security
eliminations and adjustments. (CARES) Act.
To the extent consistent with the Corporation Business Tax Act
Income of the Combined Group (1945), the federal rules and regulations governing consoli-
The relevant portions of N.J.S.A. 54:10A-4.6 require the in- dated return net operating losses and net operating loss car-
come of the members derived from the unitary business of ryovers apply to the New Jersey net operating loss carryover
the combined group to include what was reported for federal provisions under N.J.S.A. 54:10A-4.6(h) as though the com-
purposes (federal taxable income before federal net operating bined group filed a federal consolidated return, regardless of
losses and federal special deductions) modified for New Jer- how the members of the combined group filed for federal pur-
sey modifications (additions and subtractions) required by the poses. See N.J.S.A. 54:10A-4.6(m) and N.J.S.A. 54:10A-4.5.
Corporation Business Tax Act. See N.J.S.A. 54:10A-4(k). For a
member of the combined group that is a non-U.S. corporation,
N.J.S.A. 54:10A-4.6.b requires all of the income be included Intercompany Dividend Elimination
N.J.S.A. 54:10A-4.6 allows a 100% intercompany dividend
even if the entity did not file a federal return. In instances
elimination for dividends and deemed dividends between mem-
where the other members of the combined group filed a federal
bers of the combined group included on the same New Jersey
form 5471 with the IRS reporting the non-U.S. members in-
combined return. This elimination is a pre-allocation elimination
come, the form 5471 may be used if the non-U.S. member did
that occurs in column (b) of Schedule A, Part I or on Sched-
not file Form 1120-F. However, the copy of the Form 5471 that
ule A, Part II (above line 21). Dividends and deemed dividends
was filed with the federal government must be included with
from subsidiaries that are not included as members of the
the combined return. The member’s income and tax attribute
combined group are not eligible for this elimination, but may
data from Form 5471 must be entered in Part I of Schedule A
be eligible for the dividend exclusion in Schedule R if those
in that member’s column as though the taxpayer filed a federal
dividends and deemed dividends received from the excluded
return, and in Part II, line 2, enter the amount of income that
subsidiaries are part of the unitary business of the combined
would not be in federal taxable income. If a non-U.S. corpo-
group.
ration did not file federal Form 1120-F or was not reported on
federal Form 5471, it must complete an 1120-F reporting its
income and tax attributes as though the entity filed a federal Part I – Computation of Entire Net Income
return. For New Jersey purposes, on Schedule A, in Part I and Lines 4b and 4c – FDII and GILTI
Part II, the non-U.S. corporation will make the additions and The gross I.R.C. § 951A and the gross I.R.C. § 250(b)
amounts included in income for federal purposes must be
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included for New Jersey purposes. Enter the gross I.R.C. § The managerial member must include a copy of
951A (GILTI) and/or the gross I.R.C. § 250(b) (FDII) amounts. the federal returns and any forms or schedules
Do not enter negative amounts on line 4b or 4c of Sched- that accompanied the returns that were filed with
ule A, Part I. Include a copy of federal Forms 8993 and 8992 the Internal Revenue Service. Failure to include
that were completed and submitted with federal Form 1120. Do the forms and schedules will result in an incomplete New
not enter the net numbers. The I.R.C. § 250(a) deductions Jersey Corporation Business Tax return and the taxpayer
are taken in Schedule A Part II since the I.R.C. § 250(a) deduc- may be assessed penalties and interest for noncompliance.
tions permitted by N.J.S.A. 54:10A-4.15 are special deductions See Technical Bulletin, TB-98, Federal Return and the Forms
taken below line 28 for federal purposes (and are to be taken and Schedules to Include with the Corporation Business Tax
below in Part II, and not in Part I). Return Pursuant to P.L. 2020, C. 118.
A combined group may include the controlled foreign corpora-
tions (CFC) that generated Global Intangible Low Tax Income Part II – Modifications to Entire Net Income
(GILTI) included in other members’ entire net income. Members Additions
of a combined group that are incorporated under the laws of a Line 1a – Taxable income/(loss)
foreign nation must include all world-wide income regardless Enter the amount from Schedule A, Part I, line 28.
of whether it is included as income for federal purposes. If the
CFCs are included as members in the combined return, the Line 1b – Separate activity income
GILTI income that is attributable to those CFCs should be elim- Enter the amount of entire net income that is not derived from
inated on Schedule A in column (b) rather than on an additional the unitary business of the combined group. Also enter this
special schedule. amount on Schedule X, Part I, line 1. See “Portion of a Com-
pany’s Operations That are Nonunitary With This Combined
Note: Only GILTI amounts that are directly attributable to the Group” for more information.
CFC combined group members that are included in the
same New Jersey combined return can be excluded. Line 1c – Taxable income/(loss) of combined group
GILTI that is not attributable to any of the members of Subtract line 1b from line 1a and enter the result. The amount
the same New Jersey combined return cannot be elimi- in column (a) represents the entire net income attributable to
nated in column (b) of Schedule A. the unitary business of the combined group before New Jersey
additions and subtractions.
To avoid double reporting the income on Sched- Note: The amount reported in column (a) on line 1c must
ule A, Part I, members must reduce the amounts match the amount reported on Schedule CG, line 9.
reported on any other lines by the amount of the
FDII and GILTI included on lines 4b and 4c. Line 2 – Income of non-U.S. group members
Amounts on lines 4b and 4c cannot be negative. Enter the income attributable to the unitary business of the
combined group of the members that were organized in a for-
Line 5 – Interest eign nation, if such income was not included on line 1c.
Include a copy of federal Form 8916A if it was completed.
Line 3 – Other federally exempt income
Line 8 and Line 9 All income that was exempt for federal income tax purposes
Include a rider or schedules showing the same information under any provision of the Internal Revenue Code or any fed-
shown on federal Form 1120, Schedule D and/or Form 4797. eral law must be added back. If such amounts were not added
Gains and losses resulting from the disposition of property back on any other line of Schedule A, include such amounts
where an I.R.C. § 179 expense deduction was passed through on line 3 and include a rider detailing such amounts and
to S corporation shareholders are not reported on federal Form such provisions of the Internal Revenue Code. See N.J.S.A.
4797, and should be reported on Schedule A, Part I, line 10. 54:10A-4(k)(2)(A).
If a sale of shares of stock or partnership interest resulted in a
taxable transfer of a controlling interest in certain commercial Note: Items of income excluded from federal taxable net in-
real property under N.J.S.A. 54:15C-1, indicate so on a rider. come pursuant to U.S. tax treaties with the following
countries are not required to be added back: India, Can-
Line 18 – Interest ada, Japan, Germany, Mexico, Belgium, and the United
Include a copy of federal Form 8916A and/or federal Kingdom. This list of countries is not all-inclusive. For
Form 8990 if completed. information on a specific treaty country, contact the Divi-
sion of Taxation.
Line 28 – Taxable income before federal net operating loss
deductions and federal special deductions Line 4 – Interest on federal, state, municipal, and other
The amount on line 28 must agree with line 28, page 1, of the obligations
federal Form 1120 or the appropriate line of any other federal Include any interest income that was not taxable for federal in-
corporate return that was filed or would have been filed by the come tax purposes and was not included in taxable net income
member. reported on line 1c.
Line 5 – New Jersey State and other states taxes
Enter the total taxes paid or accrued to the United States, a
possession or territory of the United States, a state, a political
subdivision thereof, or the District of Columbia, or to any for-
eign country, state, province, territory or subdivisions thereof,
on or measured by profits or income, business presence or
business activity, including any foreign withholding tax taken as
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a deduction in Part I of Schedule A and reflected in line 28. For dividends that were taxed in a prior privilege period by New
additional information, see TB-80, Addback of Other States’ Jersey. Do not include any federal previously taxed income that
Taxes, and the Schedule H instructions. was not taxed by New Jersey. Schedule PT is available on the
Division’s website.
Line 6 – Related party interest addback
Enter the total amount of interest deducted on Schedule A Lines 14(a)–14(b) – I.R.C. § 250(a) Deduction
that was paid to related members that were not included as If lines 4b and 4c of Schedule A, Part I include GILTI and/or FDII
members of this combined return and reported on Schedule G, amounts, enter the amount of the deduction allowable and taken
Part I. See Schedule G instructions for more information. for federal purposes under I.R.C. § 250(a) on the appropriate
line. The amounts claimed must match the amounts reported on
Line 7 – Related party intangible expenses and costs federal Form 8993 (federal Form 8993 must be submitted).
addback
Enter the total amount of intangible expenses and costs de- Note: If the GILTI income (or portion thereof) or FDII income
ducted on Schedule A that was paid to related members not (or portion thereof) amounts were excluded from the tax
included as members of this combined return and reported base or exempt from taxation by this State, no deduction
on Schedule G, Part II. See Schedule G instructions for more or portion of the deduction can be taken for the amount
information. of income that was excluded or exempt from taxation.
See N.J.S.A. 54:10A-4.15.
Line 9 – Depreciation modification being added to income
Enter the depreciation and other adjustments being added Line 14c – Net GILTI previously taxed by New Jersey
to income if Schedule S, line 23, is a positive number. See Enter the amount of net GILTI previously taxed by New Jersey
Schedule S instructions for more information. not deducted or excluded elsewhere on the return. Attach a
rider detailing the amount of GILTI that was previously taxed
Line 10 – Other additions and the years in which the tax was paid.
Report any other additions to income for which a place has not
been provided somewhere else on the return. This includes, Line 15 – I.R.C. § 78 Gross-Up
but is not limited to: The portion of any I.R.C. § 78 gross-up included in dividend
income on line 4 of Schedule A, Part I, that is not excluded/
• Gross income, less deductions and expenses in connection deducted from taxable net income elsewhere may be treated
with such income, from sources outside the United States, as a deduction. This line cannot include the amount deducted
not included in federal taxable income; under the I.R.C. § 250(a) deduction. Include a copy of federal
• I.R.C. § 199A amounts that were deducted for federal foreign tax credit, Form 1118.
purposes;
Note: I.R.C. § 78 gross-up amounts cannot be included in
• Any deductions for research and experimental expenditures, the dividend exclusion calculation on Schedule R or
to the extent that those research and experimental expen- Form 332, which is the form used to calculate the Tiered
ditures are qualified research expenses or basic research Subsidiary Dividend Pyramid Tax Credit. In addition, if
payments for which an amount of credit is claimed pursuant any portion of the Section 78 amount is included in the
to section 1 of P.L.1993, c.175 (C.54:10A-5.24) unless those member’s Section 250 deduction, the amount being de-
research and experimental expenditures are also used to ducted on line 15 must be reduced accordingly.
compute a federal credit claimed pursuant to I.R.C. § 41.
Line 17a – Nonoperational Activity
Note: Items of income excluded from federal taxable net in- Enter the net effect of the elimination of nonoperational activity
come pursuant to U.S. tax treaties with the following from Schedule O, Part I, line 36. Schedule O is available on
countries are not required to be added back: India, Can- the Division’s website.
ada, Japan, Germany, Mexico, and the United Kingdom.
This list of countries is not all-inclusive. For information Note: Members cannot net nonoperational losses against op-
on a specific treaty country, contact the Division of erational income.
Taxation.
Line 17b – Nonunitary Partnership Income
Include separate riders explaining any items reported. Enter the net effect of the elimination of nonunitary partnership
income and expenses from Schedule P-1, Part II, line 4.
Line 11 – Taxable income/(loss) with additions
Add line 1c through line 10 and enter the total. Note: Members cannot net nonunitary partnership losses
against operational income.
Deductions
Line 12 – Depreciation modification being subtracted from Line 18 – Other deductions
income Report any other deduction adjustments for which a place has
Enter the depreciation and other adjustments being subtracted not been provided somewhere else on the return. Include a
from income if Schedule S, line 23 is a negative number. Enter rider detailing the information.
this amount on line 12 as a positive number. See Schedule S
instructions for more information. Line 19 – Total Deductions
Add lines 12 through 18 and enter the total.
Line 13 – Previously Taxed Dividends
If line 1 includes any dividends that were previously taxed for Line 20 – Entire Net Income/(Loss) Subtotal
New Jersey purposes, complete Schedule PT and Schedule R Subtract line 19 from line 11 and enter the result.
to determine the amount that can be deducted. Include only
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If column (a) of line 20 is positive, all of the mem- Line 28 – Combined group taxable net income/(loss)
bers will have entire net income derived from the Subtract line 27b from line 26 and enter the result. If less than
unitary business of the combined group. Con- zero, enter zero.
versely, if column (a) of line 20 is negative, all of
the members will have a combined group net operating loss Part III – Calculation of Tax Credits, Minimum
derived from the unitary business of the combined group. Tax and Surtax, and Group Tax
The members will determine their share of the combined For privilege periods ending on and after July 31, 2020, a com-
group net operating loss by using the member’s current year bined group will be treated as one taxpayer for purposes of
allocation factor calculated from Schedule J. This amount be- paragraph (1) of subsection (c) of section 5 of P.L.1945, c.162
comes the member’s post allocation net operating loss for (C.54:10A-5) and section 1 of P.L. 2018, c.48 (C.54:10A-5.41)
the current period available for carryover into future privilege for the income derived from the unitary business. However,
periods. the portion of income that is attributable to a member that is a
public utility exempt from the surtax shall not be included when
Line 21 – Group Allocation Factor from Schedule J computing the surtax due.
Enter the group allocation factor from Schedule J.
Line 1 – Combined group taxable net income/(loss)
Line 22 – Allocated entire net income/(loss) before net op- Enter the amount from Schedule A, Part II, line 28.
erating loss deductions and dividend exclusion
Multiply the group entire net income on line 20, column (a) by Line 2 – Member’s taxable net income from separate
the group allocation factor on line 21 and enter the result. activities
If the member completed Schedule X, include the taxable net
If the amount is zero or less, this is the current year com- income from Part I of Schedule X on this line. If the amount is
bined group net operating loss that can be carried forward zero or less, enter zero. See Schedule X instructions for more
as a post allocation net operating loss (NOL) deduction to a information.
succeeding tax period pursuant to N.J.S.A. 54:10A-4(v) and
N.J.S.A. 54:10A-4.6.h. Skip lines 23 through 26 and enter zero Line 3a – New Jersey nonoperational income
on line 28. Enter the amount from Schedule O, Part III. See Schedule O
for more information. The schedule is available on the Divi-
Line 23 – Net operating loss (NOL) deduction sion’s website.
Enter the amount from Form 500U, Section C, line 3. Do
not enter more than the amount on line 22. See Form 500U Note: Nonoperational losses cannot be netted against opera-
instructions. tional income.
Line 24 – Allocated entire net income before allocated div- Line 3b – Nonunitary partnership income
idend exclusion Enter the amount from Schedule P-1, Part II, line 5. See
Subtract line 23 from line 22 and enter the result. If the amount Schedule P-1 instructions for more information.
is zero or less, enter zero here and on line 28.
Note: Nonunitary partnership losses cannot be netted against
Line 25 – Allocated dividend exclusion operational income.
Enter the amount from Schedule R, line 12. Do not enter more
than the amount on line 24. See Schedule R instructions for Line 4 – Tax base
more information. Add lines 1 through 3b in column (a) and enter the total.
Pursuant to N.J.S.A. 54:10A-4(k)(5), N.J.S.A. 54:10A-4(u), Line 5 – Amount of tax
N.J.S.A. 54:10A-4(v), and N.J.S.A. 54:10A-4(w), the dividend For the combined group, multiply the amount on line 4 by the
exclusion is now an allocated exclusion. applicable tax rate. The tax rate is imposed at the group level.
Line 26 – Allocated entire net income subtotal • If line 4 is greater than $100,000, the tax rate is 9% (.09).
Subtract lines 25 from line 24 and enter the result. • If line 4 is greater than $50,000 and less than or equal
to $100,000, the tax rate is 7.5% (.075). Tax periods of less
Line 27a – I.B.F. exclusion than 12 months qualify for the 7.5% rate if the prorated en-
If a combined group includes a taxable member that is a bank- tire net income does not exceed $8,333 per month.
ing corporation with an international banking facility as defined
by N.J.S.A. 54:10A-4(n), the combined group is eligible to • If line 4 is $50,000 or less, the tax rate is 6.5% (.065). Tax
deduct such income amounts that were not eliminated (so that periods of less than 12 months qualify for the 6.5% rate if
the entire combined group is treated as one banking corpo- the prorated entire net income does not exceed $4,166 per
ration). The income must have otherwise been eligible for the month.
I.B.F. deduction under N.J.S.A. 54:10A-4(k)(4) and is an allo-
cated amount. See N.J.S.A. 54:10A-4.6(o). Also enter this amount on page 1, line 1.
Note: Income that was eliminated above line 27a is not eligible Line 6 – Tax credits
for the I.B.F exclusion. Enter the amount from Schedule A-3, Part I, line 28. Also enter
this amount on page 1, line 2. Include the applicable credit
Line 27b – Allocated I.B.F. exclusion form(s) with the return. See Schedule A-3 instructions for more
Multiply the amount on line 27a, column (a) by the group allo- information.
cation factor from line 21 and enter the result.
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Line 7 – CBT tax liability Part I – Tax Credits Used Against Liability
Subtract line 6 from line 5 and enter the result. Also enter this On line 28, enter the total credits from all members in the
amount on page 1, line 3. combined group column. This amount must equal the amount
reported on Schedule A, Part III, line 6. Amounts to be entered
Line 8 – Total surtax of combined group for each member are calculated on the credit forms. See the
Enter the amount from Schedule A-5, Part II, line 5. Also enter specific New Jersey Corporation Business Tax Credit form for
this amount on page 1, line 4. information about each credit.
Line 9a – Aggregate minimum tax of combined group Note: Most tax credits cannot reduce the tax liability below the
Multiply the number of taxable group members by $2,000 and minimum tax. However, there are rare instances where it
enter the result. can. Follow the instructions on the credit form regarding
how and where to record the information to ensure the
Line 9b – Tax due credit is properly offsetting the tax liability.
Add the surtax calculated on line 8 to the greater of line 7 or
line 9a. Also enter this amount on page 1, line 5. Part II – Refundable Tax Credits
If a credit form for a member calculates an amount to be re-
Note: If a tax credit can be applied to 100% of the tax liability, funded, enter the refundable portion on the appropriate line for
add the surtax (if applicable) to any remaining liability that member. On line 5, enter the total for all members in the
not exhausted on the credit form and enter the amount combined group column. This amount must equal the amount
on line 9b. reported on page 1, line 11b. On line 6, enter the total for all
members in the combined group column. This amount must
equal the amount reported on page 1, line 11c.
Schedule A-2
Cost of Goods Sold
Enter member’s amounts in the member’s column. In column Schedule A-4
(c), enter the total amounts of all members prior to intercom- Summary Schedule
pany eliminations and adjustments. In column (b), enter the in- This schedule must be completed for each member. Report
tercompany eliminations and adjustments. In column (a), enter the information on each line of Schedule A-4 from the return
the total amounts for the combined group after intercompany schedules indicated. All lines must be completed as applicable.
eliminations and adjustments.
The amounts reported on this schedule must be the same as
the amounts reported on federal Form 1125-A. Include Form Schedule A-5
1125-A with the return. Computation of Group and Member Surtax
For privilege periods beginning on or after January 1, 2020,
a combined group or an affiliated group is a taxpayer for pur-
poses of the surtax; therefore, the surtax is calculated at the
Schedule A-3 group level. If Schedule A, Part III, line 1, column (a) is more
Summary of Tax Credits than $1,000,000, the group is subject to the surtax.
This schedule must be completed if any tax credits are being
claimed for the current tax period. There are various tax credits
Part I – Combined Group Surtax
with a variety of limitations. Each tax credit has its own limita- The combined group surtax portion of this schedule is used to
tions and carryovers. calculate the surtax imposed on the combined group. Part I is
also used to apply the shareable portion of the Pass-Through
Taxpayers must include the appropriate credit Business Alternative Income Tax credit, which is calculated
form in the year the credit was earned even if they on Form 329. The credit is only shareable if the pass-through
are not claiming the credit on their tax return. entity is unitary with both the member and the combined group.
See N.J.S.A. 54:10A-5.43(c)
In general, tax credits are earned by the member of the Line 1 – Combined group taxable net income/(loss)
combined group and are shareable among combined group Enter the amount from Schedule A, Part II, line 28. Public
members. However, members are not required to share their utilities are not subject to the surtax. If an includable public
credits. See N.J.S.A. 54:10A-4.6.i and TB-90, Tax Credits and utility (i.e., a public utility that is not excluded under N.J.S.A.
Combined Returns. See the instructions of the applicable credit 54:10A-4.6(k)) is a member of the combined group, the portion
form(s) for more information. of the taxable net income attributable to that public utility must
be excluded. Subtract the public utility’s portion of Schedule A,
Any tax credit(s) claimed on this schedule must be docu- Part II, line 28 before entering an amount on Schedule A-5,
mented with a valid New Jersey Corporation Business Tax Part I, line 1.
Credit form and must be included with the tax return. See
“Additional Forms and Instructions” for a list of available credit Line 2 – Surtax on combined group taxable net income
forms and for instructions on obtaining them. If a member is Multiply line 1 by the surtax rate. The rate is 2.5% for tax years
claiming a valid tax credit that is allowable in accordance with beginning on or after January 1, 2018, through December 31,
the New Jersey Corporation Business Tax Act for which a place 2023. See Surtax for more information.
has not been provided somewhere else on the schedule, report
the amount on the “Other” line in the appropriate section of
Schedule A-3.
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Line 3 – Pass-Through Business Alternative Income Tax Jersey combined return must be reconciled on this schedule.
Credit Furthermore, differences between federal taxable income
Enter the amount from Form 329, line 23b. Do not enter more and taxable income/(loss) of combined group as reported on
than the amount of surtax on line 2. Include the applicable Schedule A, Part II, line 1(c) must be reconciled here.
credit form(s) with the return. See Schedule A-3 instructions for
more information. Note: If filing under the affiliated group election, the New Jer-
sey combined group must match the members reported
Part II – Member’s Surtax in Section A.
The member’s surtax portion of this schedule is used to calcu-
late the remaining portion of the group’s surtax after the share- Section A – Federal Consolidated Group
able portion of the Pass-Through Business Alternative Income List the entities included in the federal consolidated return(s).
Tax credit is applied. The remaining portion of the combined List the corporation name, federal employer identification num-
group surtax is apportioned to each member and then added to ber (FEIN), and the amount on line 28 of the federal Form 1120
any amount of surtax that a member may have from activities or the appropriate line of any other federal corporate return that
independent of the group. The nonshareable portion of the was filed. The entities listed must match the entities reported
Pass-Through Business Alternative Income Tax credit then is on the federal Form 851.
applied against this amount. The Pass-Through Business Al-
ternative Income Tax credit is nonshareable if the pass through Section B – Members Included in the New Jersey Com-
entity is unitary with the member but not the combined group. bined Group Not Reported in Section A
See N.J.S.A. 54:10A-5.43(d) List any members included in the New Jersey combined group
(CBT-100U) not included in Section A. Any member of the New
Line 1a–1c – Calculating member’s share of combined Jersey CBT-100U that is not reported in Section A (federal con-
group surtax solidated group) must be reported in this section.
Divide the balance of combined group surtax by the group
allocation factor, then multiply the result by the member’s allo- Section C – Members Reported in Section A Not Included
cation factor to arrive at the member’s share of the combined in the New Jersey Combined Group
group surtax. List any entity from Section A that is not part of the New Jer-
sey combined group. Any member of the federal consolidated
Line 2a–2b – Calculating surtax on member’s independent group that is reported in Section A and is not a member of
taxable net income the CBT-100U must be reported in Section C. Members in
Multiply the member’s taxable net income from separate activ- this section will not be part of the New Jersey combined
ities from Schedule X by the surtax rate. The rate is 2.5% for return.
tax years beginning on or after January 1, 2018, through De-
cember 31, 2023. See Surtax for more information. Section D – Adjustments to Federal Taxable Income
Any adjustment to federal taxable income must be reported in
Line 4 – Pass-Through Business Alternative Income Tax this section. Include a rider detailing each adjustment and the
Credit reason for the adjustment.
Enter the amount from Form 329, line 32d. Do not enter more
than the amount of surtax on line 3. Include the applicable
credit form(s) with the return. See Schedule A-3 instructions for Schedule E
more information. Schedule E has been discontinued. If a member has
overpayments from a previously filed separate re-
Line 5 – Total surtax turn or that made payments under their own account
Subtract the amount on line 4 in the combined group column the managerial member for must provide a spreadsheet sepa-
from the amount on line 3 in the combined group column and rate from the return. Please visit the Division’s website for more
enter the result. This is the total surtax for the combined group. information.
Enter this amount on Schedule A, Part III, line 8.
Schedule F
Schedule B Corporate Officers – General Information and
Schedule B has been discontinued. The Division will
Compensation
use data from federal Form 1120, Schedule L. Provide all applicable information for each corporate
officer from the managerial member’s corporation
regardless of whether compensation was received.
Schedule C and Schedule C-1 The data reported on Schedule F must match amounts re-
Schedules C and C-1 have been discontinued. The ported on federal Form 1125-E. Include Form 1125-E with your
Division will use data from federal Form 1120, return.
Schedules M-1, M-2, and M-3.
Schedule G
Schedule CG Interest
Reconciliation With Consolidated Group If the member is claiming an exception to the disallowance of
Schedule CG is used to reconcile taxable income of the federal the expense reported in Part I or Part II of Schedule G, the
consolidated group to the taxable income of the members re- member must complete and include Schedule G-2. The sched-
ported on the New Jersey CBT-100U. Any differences between ule is available on the Division’s website.
members of the consolidated group and members on the New
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Intercompany transactions between members of the combined In computing the allocation factor for the members
group are eliminated/adjusted on Schedule A, Part I or Part II and the combined group as a whole, intercom-
and are exempt from the related party addbacks pursuant to pany receipts are eliminated.
N.J.S.A. 54:10A-4(k)(2)(i) and N.J.S.A. 54:10A-4.4. Report
those amounts on the respective line of column (b) on Sched-
ule A. Do not report these amounts on Schedule G.
Lines 1–5 – Receipts Fraction
Note: Treaty exceptions have been limited pursuant to P.L. Receipts from sales of tangible personal property are allo-
2018, c. 48. There are additional requirements to meet cated to New Jersey if the goods are shipped to points within
the treaty exceptions that are reported for the purposes New Jersey. Receipts from the sale of goods are allocable to
of Part I and Part II of Schedule G. See the instructions New Jersey if shipped to a New Jersey or a non-New Jersey
for Schedule G-2 for more information. customer where possession is transferred in New Jersey.
Receipts from the sale of goods shipped to a taxpayer from
For definitions, see N.J.S.A. 54:10A-4(k)(2)(i) and N.J.S.A. outside New Jersey to a New Jersey customer by a common
54:10A-4.4. carrier are allocable to New Jersey. Receipts from the sale
of goods shipped from outside New Jersey to a New Jersey
Part I – Interest location where the goods are picked up by a common carrier
Interest paid, accrued, or incurred to related members that and transported to a customer outside New Jersey are not allo-
was deducted in calculating taxable net income on Sched- cable to New Jersey. Receipts from the following are allocable
ule A, Part I, line 28, must be reported on Schedule G, Part I. to New Jersey: services performed if the benefit of the service
Enter the total of such interest expense on Schedule A, Part II, is received in New Jersey; rentals from property situated in
line 6. New Jersey; royalties from the use in New Jersey of patents,
copyrights, and trademarks; all other business receipts earned
Do not include interest expenses and costs that were deducted in New Jersey.
directly or indirectly for, related to, or in connection with the
direct or indirect acquisition, maintenance, management, own- Services are sourced based on market sourcing,
ership, sale, exchange, or disposition of intangible property in not cost of performance. See N.J.A.C.
Part I of Schedule G. 18:7-8.10A.
Part II – Interest expenses and costs and intangible ex-
penses and costs Receipts From Sales of Capital Assets. Receipts from sales
Interest expenses and costs and intangible expenses and of capital assets (property not held by the member for sale to
costs directly or indirectly paid, accrued, or incurred to, or in customers in the regular course of business), either within or
connection directly or indirectly with one or more direct or indi- outside New Jersey, should be included in the numerator and
rect transactions with one or more related members that were the denominator based on the net gain recognized and not on
deducted in calculating taxable net income on Schedule A, gross selling prices. If the member’s business is the buying
Part I, line 28, must be reported on Schedule G, Part II. Enter and selling of real estate or the buying and selling of securities
the total of such intangible expenses and costs on Schedule A, for trading purposes, gross receipts from the sale of such as-
Part II, line 7. sets should be included in the numerator and the denominator
of the receipts fraction.
Schedule H Note: The amount of dividends (deemed and/or paid divi-
Taxes dends) excluded from entire net income pursuant to
Itemize all taxes that were in any way deducted in arriving at N.J.S.A. 54:10A-4(k)(5), are not included in the numer-
taxable net income, whether reflected in Schedule A, Part I at ator or denominator of the receipts fraction. However,
line 2 (Cost of goods sold and/or operations), line 17 (Taxes), the dividend (deemed and/or paid dividends) values
line 26 (Other deductions) or anywhere else on Schedule A. that are not excluded are included in the numerator or
denominator.
If the member is an includable public utility corporation (i.e., a
public utility that is not excluded from the combined group per Schedule J must be completed after calculating
N.J.S.A. 54:10A-4.6(k)(2)), enter the sales tax paid by the utility the Dividend Exclusion line on the respective
vendor. parts of Schedule R but before calculating the line
for the Allocated Dividend Exclusion. The amount
from the Dividend Exclusion line from Schedule R is the
Schedule J amount to use when calculating the dividends and deemed
Computation of Group and Members’ Allocation dividends excluded from the numerator and/or denominator
Factors for the purposes of completing Schedule J.
Enter each member’s amount in the member’s column. All
members must complete this schedule to calculate the alloca- Line 9 – Allocation Factor
tion factor. Divide line 6c by the group denominator from line 8 and enter
the result. When computing the allocation factor on Sched-
Only activities related to operational activity are to be used in ule J, division must be carried to six (6) decimal places, e.g.,
computing the general allocation factors. If the member has 0.123456.
nonoperational activity, see Schedule O. If the member has
nonunitary partnership income, see Schedule P-1. Note: Eliminations and adjustments are made before calculat-
ing the Allocation Factor, and the Allocation Factor must
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be calculated using post-elimination and adjustment group’s mobile assets in this State by type of mobile asset and
numbers. the denominator of which is the total ton miles traveled by the
combined group’s mobile assets everywhere. This section ap-
Sourcing GILTI and FDII for Combined Groups plies if 50% or more of the combined group’s entire net income
Water’s-Edge Group Basis or Affiliated Group Basis Re- is derived from the transportation of freight by air or ground.”
turns – No CFCs included. Members must include the net If the combined group meets the qualifications of N.J.S.A.
GILTI (i.e., the GILTI reduced by the I.R.C. § 250(a) GILTI 54:10A-4.7.b, attach a rider and enter the applicable amounts
deduction) and net FDII income (i.e., the receipts attributable on line 9 of Schedule J.
to the FDII reduced by the I.R.C. § 250(a) FDII deduction)
amounts in the numerator (if applicable) and the group de-
nominator of the allocation factor on Schedule J pursuant to Allocation Methods for Combined Returns
N.J.S.A. 54:10A-4.7. The GILTI income and FDII income and the The two methods available to allocate the income of a combined
corresponding I.R.C. § 250(a) deductions must be reported on group are “Joyce” and “Finnigan.” These allocation methods
Schedule A. Do not include the underly ing receipts of the con- derive their names from California Franchise Tax Board cases.
trolled foreign corporation generating the GILTI in the numera- These methods are differentiated by their determination of the
tor or group denominator since the controlled foreign corpora- allocation factor. Under either method, the allocation factor attri-
tions were not included as members of the combined return. butes included in the denominator are the same. The denomina-
tor includes all of the combined group’s total factors, regardless
Water’s-Edge Group Basis or World-Wide Group Basis of nexus.
Returns – With CFCs included as members. Members must
include the CFC’s receipts (net of the I.R.C. § 250(a) deduction The Joyce method includes all of the New Jersey alloca-
for GILTI) in the numerator (if applicable) and the group de- tion factor attributes in the numerator that were derived from
nominator pursuant to N.J.S.A. 54:10A-4.7. The GILTI income members that have nexus with New Jersey. The Finnigan
is excluded from the combined group’s entire net income, as method includes all New Jersey allocation factor attributes in
described in TB-88, Combined Groups: Exclusion of Double In- the numerator that were derived from all of the members of the
clusion of GILTI and Treatment of Related Party Addbacks, and combined group, regardless of whether a member has nexus
the GILTI must be excluded in the allocation factor. This is to with New Jersey.
prevent the double taxation and double counting of the income
and receipts derived from the same source since the CFC’s The allocation method is tied to the combined return filing
income is already included in the combined group’s entire net method that the managerial member uses to file the com-
income. The combined group must include the net FDII income bined return. The Water’s-Edge Group Basis and World-Wide
(i.e., the receipts attributable to the FDII reduced by the I.R.C. § Group Basis returns follow Joyce method pursuant to N.J.S.A.
250(a) FDII deduction) amount in the numerator (if applicable) 54:10A-4.7.
and the group denominator of the allocation factor on Sched-
ule J, pursuant to N.J.S.A. 54:10A-4.7. The GILTI income, CFC Note: A member of a combined group can have nexus with
income, and FDII income and the corresponding I.R.C. § 250(a) New Jersey by deriving receipts from New Jersey or
deductions must be reported on Schedule A as part of the com- from any other factors pursuant to N.J.A.C. 18:7-1.6
bined group’s entire net income. through N.J.A.C. 18:7-1.11. The member can have
nexus as part of the unitary business of the combined
See TB-92(R), Sourcing IRC § 951A (GILTI) and IRC § 250 group or it may have nexus independently. If one mem-
(FDII), for more information. ber in the combined group has nexus and sufficient ac-
tivities in New Jersey to be taxed based on income, no
Airlines member that has nexus with New Jersey may claim P.L.
Airlines have special sourcing rules pursuant to N.J.S.A. 86-272 protection.
54:10A-6.3, which states: “Notwithstanding the provisions of
section 6 of P.L.1945, c.162 (C.54:10A-6), the sales fraction Affiliated Group Basis returns follow Finnigan method as statu-
for the transportation revenues of a taxpayer that is an airline torily prescribed by N.J.S.A. 54:10A-4.11.c.
shall be determined as the ratio of revenue miles in this State
divided by total revenue miles; provided however, that if a tax- Note: Pursuant to N.J.S.A. 54:10A-4.6, when an item of in-
payer that is an airline is engaged in the transportation of pas- come is restored to a member, such restoration must be
sengers, the transportation of freight, or the rental of aircraft, reflected in both the member’s numerator (if applicable)
the ratio under this section shall be determined by means of and the group denominator.
an average of a passenger revenue mile fraction, freight rev-
enue mile fraction, and rental revenue mile fraction weighted
to reflect the taxpayer’s relative gross receipts from passenger Schedule L
transportation, freight transportation, and rentals.” See also Allocation of New Jersey Corporation Business
N.J.S.A. 54:10A-6.3; N.J.A.C. 18:7-8.1; N.J.A.C. 18:7-8.10; Tax for Banking and Financial Corporation
and N.J.A.C. 18:7-8.10A.
Members Among New Jersey Municipalities
Transportation Companies Office Location in New Jersey – List all offices maintained by
Transportation companies have special sourcing rules for the member in this State by indicating the exact taxing district
combined groups pursuant to N.J.S.A. 54:10A-4.7.b, which (municipality) and county.
states: “All business income of a combined group engaged in
Note: The mailing address of an office is not necessarily the
the transportation of freight by air or ground shall be appor-
taxing district.
tioned to this State by multiplying the income by a fraction, the
numerator of which is the ton miles traveled by the combined
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Deposit Balances or Receipts – Banking corporations must The fee is assessed provided there are more than two pro-
use the deposit balances. Financial corporations use the re- fessionals in the PC. The fee is assessed on professionals
ceipts allocable to such location. that are owners, shareholders, and/or employees of the pro-
fessional corporation. The number of professionals should be
Percentages – The percentage indicated is based on the indi- calculated using a quarterly average. The fee for each resident
vidual deposit balances for banking corporations or receipts for and nonresident professional with physical nexus with New
financial corporations divided by total deposit balances in New Jersey is $150. The fee for each nonresident professional
Jersey, or total receipts in New Jersey, respectively. without physical nexus with New Jersey is $150 multiplied by
the allocation factor of the corporation. The fee is limited to
Member’s totals are the sum of the individual taxing district $250,000 per year.
amounts and percentages. Total percentage reported must
equal 100%. Also, each individual computation should be car- In the event of a period shorter than a year, the fee and limit
ried to six decimal places. may be prorated by months. A fraction of a month is deemed to
be a month.
Schedule P-1 Check the box on the Members and Affiliates Schedule to indi-
cate this is a professional corporation for applicable members.
Partnership Investment Analysis
Part I – Partnership Information
Itemize the investment in each partnership, limited liability com- Line 4 – Installment Payment: A 50% prepayment towards the
pany, and any other entity that is treated for federal tax pur- subsequent year’s fee is required with the current year’s return.
poses as a partnership. List the name, the federal identification
Line 8 – Credit: Amount to be credited towards next year’s fee.
number, and the date and state where organized for each part-
This fee is not eligible for refund.
nership. Also, check the type of ownership (general or limited),
the tax accounting method used to reflect your share of part-
nership activity on this return (flow through method or separate
accounting), and whether or not the partnership has nexus in Schedule R
New Jersey. Itemize in column 7 the amount of tax payments Dividend Exclusion
made on behalf of the member by partnership entities. Carry Intercompany dividends (and deemed dividends)
the total amount of taxes paid on behalf of members to page 1, between members of the combined group that
line 10. Include a copy of Schedule NJK-1 from Form NJ-1065. were eliminated/excluded above Schedule A,
Any single-member limited liability company must be included Part II, line 20 are not eligible for the dividend ex-
on this schedule. clusion and are not to be included in the computation
on Schedule R. Only dividends and deemed dividends that
Part II – Separate Accounting of Nonunitary Partnership are a part of the unitary business of the combined group that
Income were received from subsidiaries that were not included as
Members that use a Separate Tax Accounting Method on members of the same New Jersey combined return are eligi-
nonunitary partnership investments must complete Part II to ble for the exclusion. Water’s-edge and world-wide basis fil-
compute the appropriate amount of tax. Pursuant to N.J.S.A. ers, see Schedule X for more information.
54:10A-6, members must enter a single sales factor allocation
in column 3. Do not use three-factor allocation (property, pay- For privilege periods ending on and after July 31, 2020, for pur-
roll, and sales) from the partnership return (Form NJ-1065). poses of the dividend exclusion, the members of a combined
group filing a New Jersey combined return are treated as one
taxpayer with regard to dividends and deemed dividends that
Schedule PC were received as part of the unitary business of the combined
Per Capita Licensed Professional Fee group. See N.J.S.A. 54:10A-4(k)(5)(E).
Professional corporations (PC) formed under N.J.S.A.
14A:17-1 et seq. or any similar laws of a possession or territory For privilege periods ending on and after July 31, 2019, the
of the U.S., a state, or political subdivision thereof, are liable dividend exclusion is a post allocation exclusion.
for a fee on licensed professionals.
Dividends from all sources must be included in Schedule A.
Examples of licensed professionals are: certified public ac- However, taxpayers may exclude from entire net income 95%
countants, architects, optometrists, professional engineers, of dividends from qualified subsidiaries, if such dividends were
land surveyors, land planners, chiropractors, physical thera- included in the taxpayer’s gross income on Schedule A and not
pists, registered professional nurses, dentist, osteopaths, phy- eliminated.
sicians and surgeons, doctors of medicine, doctors of dentistry,
podiatrists, veterinarians and, subject to the Rules of the Su- Taxpayers cannot include the following as part of the dividend
preme Court, attorneys at law (N.J.S.A. 14A:17-3). exclusion:
• Money market fund or REIT income;
Note: Licenses acquired through vocational training and/or
apprenticeships within those trades are not considered • GILTI or FDII (this is not considered income from dividends
licensed professionals. Examples include plumbers, or deemed dividends for New Jersey Corporation Business
electricians, HVAC technicians, cosmetologists, fire and Tax purposes); or
burglar alarm services, acupuncturists, hair stylists, ele- • The portion of I.R.C. § 78 gross-up deducted on line 15,
vator, escalator, and moving walkway mechanics, lock-
Part II, Schedule A.
smiths, and court reporters.
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A qualified subsidiary is defined as ownership by the tax- circumstances, the information can be found on federal Form
payer of at least 80% of the total combined voting power of 4562.
all classes of stock entitled to vote and at least 80% of the
total number of shares of all other classes of stock, except Line 13 – New Jersey conforms to I.R.C. § 179 as in effect on
non-voting stock which is limited and preferred as to dividends. December 31, 2002, and the maximum amount that may be
With respect to other dividends, the exclusion is limited to 50% expensed is $25,000. See N.J.S.A. 54:10A-4(k)(13) for more
of such dividends included in the taxpayer’s gross income on information.
Schedule A, provided the taxpayer owns at least 50% of vot-
ing stock and 50% of the total number of shares of all other Line 16 and Line 17 – New Jersey has decoupled from the
classes of stock. federal tax code provisions on cost recovery or depreciation
and is statutorily tied to the federal depreciation laws that were
A 95% dividend exclusion will be granted for dividends that are in effect as of December 31, 2001.
included in entire net income from an 80% or greater owned
subsidiary. If the taxpayer owns 50%, but less than 80% of a Line 18 – Deduct any income included in the return with re-
subsidiary, they are entitled to a 50% exclusion. Any subsid- spect to property solely as a result of an I.R.C. § 168(f)(8)
iary that is owned less than 50% is not entitled to a dividend election.
exclusion. See N.J.S.A. 54:10A-4(k)(5), N.J.S.A. 54:10A-4(u),
N.J.S.A. 54:10A-4(v), and N.J.S.A. 54:10A-4(w) for more Line 19 – Deduct any depreciation amount that would have
information. been allowable under the Internal Revenue Code on Decem-
ber 31, 1980, had there been no safe harbor lease election.
If the taxpayer received tiered dividends from a tiered subsid-
iary that filed and paid tax to New Jersey on those same divi- Line 20 – Gain or loss on property sold or exchanged is the
dends, do not include these dividends on Schedule R. amount properly to be recognized in the determination of
federal taxable income. However, on the physical disposal of
The tiered dividend exclusion has been phased out and re- recovery property, whether or not a gain or loss is properly to
placed with the Tiered Subsidiary Dividend Pyramid Tax Credit be recognized under the federal Internal Revenue Code, there
on Form 332. The tiered dividends from certain subsidiaries shall be allowed as a deduction any excess, or there must be
may be eligible for a tax credit, which is calculated separately restored as an item of income, any deficiency of depreciation
on Form 332. See Form 332 for more information. This form is disallowed at lines 9, 10, 11, 13, or 14 over related deprecia-
available on the Division’s website. tion claimed on that property at lines 16, 17, or 21. A statutory
merger or consolidation shall not constitute a disposal of recov-
ery property.
New Jersey follows the federal ownership attribu-
tion rule changes under I.R.C. § 958(b) and I.R.C.
§ 318 that broadened the federal attribution rules
that were retroactive to January 1, 2017, in addi- Form 500U
tion to the already broad Corporation Business Tax attribution Prior Net Operating Loss Conversion Carryover
rules. (PNOL) and Post Allocation Net Operating Loss
(NOL) Deductions
Schedule PT – Previously Taxed Dividends: If a taxpayer Prior Net Operating Losses (PNOLs) are losses that were
had subsidiary dividend income that was reported in a previ- generated in privilege periods ending prior to July 31, 2019.
ous privilege period for New Jersey Corporation Business Tax To use these losses, the unused, unexpired amounts must be
purposes and for which the taxpayer paid greater than the converted to a post allocation basis. This conversion is done
New Jersey minimum tax in that privilege period and those on Form 500U-P. PNOLs can only be carried forward for the
same dividends are included in entire net income this privilege 20 privilege periods following the period of the initial loss. See
period, complete Schedule PT in conjunction with Schedule R. TB-95, Net Operating Losses and Combined Groups, for more
See Schedule PT for more information. The schedule is avail- information.
able on the Division’s website.
PNOLs must be deducted from allocated entire
net income before any NOLs can be deducted.
Schedule S
Depreciation and Safe Harbor Leasing
This schedule must be completed for each member and a
copy of a completed federal Depreciation Schedule, Form Post Allocation Net Operating Losses (NOLs) are losses that
4562 must be included with the return. Schedule S provides were generated in privilege periods ending on or after July 31,
for adjustments to depreciation and certain safe harbor leasing 2019. These losses occur on a post allocation basis.
transactions.
For New Jersey Corporation Business Tax purposes, net oper-
New Jersey has decoupled from I.R.C. § 168(k) ating losses and net operating loss carryovers have a 20-year
bonus depreciation and I.R.C. § 179 expensing carryover period and can only be carried forward. No carry-
provisions. See N.J.S.A. 54:10A-4(k)(12) and backs are allowed.
N.J.S.A. 54:10A-4(k)(13). Adjustments must be
made accordingly. For tax years beginning on and after January 1, 2020, the fed-
eral rules and regulations governing consolidated return net
Line 1 through Line 6 – These lines detail the deprecia- operating losses and net operating loss carryovers apply to the
tion deduction reflected in the Computation of Entire Net New Jersey net operating loss carryover provisions to the ex-
Income (Schedule A, Part I) into several categories. In most tent they are consistent with the provisions of the New Jersey
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Corporation Business Tax Act. If the New Jersey and federal Line 4 – Enter the amount of PNOLs reported on line 1 that
provisions differ, the New Jersey Corporation Business Tax Act was used on the current period Schedule X. An affiliated group
provisions govern. New Jersey generally follows the federal election is an election to deem all of the activities as one single
rules governing mergers, acquisitions, reorganizations, spin- business. As such, line 4 is not applicable to affiliated group
offs, split-offs, dissolution, bankruptcy, or any form of cessation basis returns.
of a business. New Jersey also follows any other provision of
the federal rules that limits or reduces federal net operating Line 5 – Enter the amount excluded from federal taxable in-
losses and federal net operating loss carryovers. See N.J.S.A. come under subparagraph (A), (B), or (C) of paragraph (1) of
54:10A-4.6(m) and N.J.S.A. 54:10A-4.5(c). subsection (a) of Internal Revenue Code (26 U.S.C. s.108) in
the current year. If the amount is greater than the PNOLs re-
Discharge of Indebtedness ported on line 1 (less lines 2, 3, and 4), carry the remainder to
If a member has a discharge of indebtedness amount that is Section B, line 5.
excluded from federal taxable income under subparagraph (A),
(B), or (C) of paragraph (1) of subsection (a) of I.R.C. section Line 6 – Subtract the amounts reported on lines 2 through 5
108, adjustments need to be made to the member’s PNOLs, from the amount on line 1. This is the total amount of PNOLs
NOLs, and/or post allocation net operating loss carryovers. available for deduction in the current year. If the amount is zero
Since the discharge of indebtedness amount is not an allo- or less, enter zero.
cated amount, the member must multiply the discharge of in-
debtedness amount by its current year allocation factor (mem- Line 7a – Enter the amount from Schedule A, Part II, line 20,
ber’s numerator over the group’s denominator) before making column (a).If the amount is less than zero, enter zero.
any adjustment to the net operating losses or net operating
loss carryovers. Line 7b – Multiply line 7a by the member’s allocation factor
from Schedule J, line 9.
The members must first reduce their PNOLs by the allocated
discharge of indebtedness amount. If the allocated discharge Line 8a – Enter the lesser of lines 6 or 7b. This is the current
of indebtedness amount exceeds all of a member’s PNOLs period PNOL deduction. Also enter this amount on line 8 of
and the member has post allocation net operating loss carry- Section B.
overs, the member must also reduce the post allocation net
operating loss carryovers by the remaining balance. If, after Line 8b – Total the member columns and enter the result in the
reducing their post allocation net operating loss carryovers combined group column. Also enter this amount on line 1 of
by the discharge of indebtedness amount, there are still post Section C.
allocation net operating loss carryovers available, the taxable
member may then reduce their allocated entire net income by Section B – Post Allocation Net Operating Losses (NOL)
the remaining post allocation net operating loss carryover. This section is only applicable to loss carryovers from periods
ending on and after July 31, 2019. Only complete this section
Members must keep accurate books and records to keep track if the total combined group allocated entire net income/(loss)
of the various PNOLs and NOLs. before net operating loss deductions and dividend exclusion on
Schedule A, Part II, line 22 is positive (i.e., income).
Section A – Computation of Prior Net Operating Losses
(PNOL) Deduction Section B is used to calculate the amount of the New Jersey
This section is only applicable if a member has loss carryovers post allocation net operating loss carryover. There are two
from periods ending prior to July 31, 2019. Only complete this types of post allocation net operating loss carryovers:
section if the total combined group allocated entire net income/ • Combined group post allocation NOLs (these are losses
(loss) before net operating loss deductions and dividend exclu- that were generated by the current combined group) and
sion on Schedule A, Part II, line 22 is positive (i.e., income).
• Separate return post allocation NOLs (these are losses that
Note: PNOLs expire 20 privilege periods after the loss was were generated outside the current combined group)
originally generated. PNOLs cannot be shared.
The post allocation net operating loss deduction is subtracted
If any members had a PNOL, check the box marked from allocated entire net income after the member uses all of
“Yes” for those members that are NOT using a its PNOLs.
PNOL and begin Form 500 at Section A, line 1 for
every member that IS USING a PNOL. Certain taxable members may be eligible to share their post
allocation net operating losses. If a loss was generated on a
If no members are claiming a PNOL Check the “No” box in the previously filed combined return, the taxable members that
group combined column. Enter zero on Section C, line 1 and were included on that return are each allotted a portion of the
continue with Section B. loss. Taxable members can use their portion of these combined
group post allocation net operating loss (NOL) carryovers, or
Line 1 – Enter the total amount reported on Form 500U-P, they can share their portion with other taxable members that
Part II, line 21 for each member. were part of the same combined group in the period in which
the loss was generated. See TB-95, Net Operating Losses and
Line 2 – Enter the amount of PNOLs reported on line 1 that Combined Groups, for more information.
was deducted in a previous year.
Note: Separate return post allocation net operating loss car-
Line 3 – Enter the amount of PNOLs reported on line 1 that ryovers and NOLs generated on Schedule X are not
has expired. shareable.
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Line 1 – Enter the total amount reported on Form 500U-PA, Line 14 – Add line 10 and line 13 and enter the total. The
Part II, line 21 for each member. amount cannot exceed the amount on line 9. This is the current
period NOL deduction. Enter the total of the members’ amounts
Line 2 – Enter the amount of NOLs reported on line 1 that was in the combined group column and on line 2 of Section C.
deducted in a previous period or was shared with another tax-
able member in a previous period. Note: A taxable member that leaves a New Jersey combined
group must take their share of the combined group post
Line 3 – Enter the amount of NOLs reported on line 1 that has allocation net operating loss carryover. The combined
previously expired. group cannot continue to use that member’s portion of
the loss.
Line 4 – Enter the amount of the separate return NOLs re-
ported on line 1 that was used on the current period Sched-
Losses generated on Schedule X cannot be
ule X. An affiliated group election is an election to deem all shared or used by the group. These losses can
of the activities as one single business. As such, line 4 is not
only be used on Schedule X.
applicable to affiliated group basis returns.
Line 5 – Enter the amount of any adjustments required under
provisions of the federal Internal Revenue Code. New Jersey
generally follows the federal rules governing mergers, acqui- Form 500U-P
sitions, reorganizations, spin-offs, split-offs, dissolution, bank- Form 500U-P was designed to help taxpayers transition to the
ruptcy, or any form of cessation of a business. New Jersey also new net operating loss regime. Taxpayers were required to
follows any other provision of the federal rules that limits or convert these losses using the allocation factor from the last
reduces federal net operating losses and federal net operating privilege period ending before July 31, 2019. A copy of this
loss carryovers. See N.J.S.A. 54:10A-4.5(c) for more informa- form must be included with the taxpayer’s return each year
tion. If the member reported an amount in Section A, line 5 of until the losses are used up or expired but is not recomputed
Form 500U, only enter the excess here. (Section A, line 1 mi- each year.
nus lines 2, 3, 4, and 5.)
Line 6 – Subtract the amounts reported on lines 2 through 5 Form 500U-PA
from the amount on line 1. This is the total amount of NOLs Part I
available for deduction in the current year. If the amount is less Enter the date on which the member entered the group.
than zero, enter zero.
Part II – Net Operating Loss
Line 7a – Enter the amount from Schedule A, Part II, line 20, Line (a) – Enter the date the privilege period ended. All periods
column (a).If the amount is less than zero, enter zero. must end on or after July 31, 2019.
Line 7b – Multiply line 7a by the member’s allocation factor Line (b) – Enter the net operating loss for each period. Enter
from Schedule J, line 9. the entire loss for the period. Do not net with previously de-
ducted or expired amounts. Amounts that have been previously
Line 8 – Enter the amount from Section A, line 8a. deducted or that are expired must be reported on Form 500U,
Section B on lines 2 and 3. The converted losses can only be
Line 9 – Subtract line 8 from line 7b and enter the result. carried forward for the 20 privilege periods following the period
of the initial loss.
Line 10 – Enter the lesser of lines 6 or 9.
Note: For privilege periods ending after June 30, 2014, the
Line 11 – Subtract line 10 from line 6. This is the amount of loss reported each year must not include any amount
NOLs available to share with other taxable members. excluded from federal taxable income under subpara-
graph (A), (B), or (C) of paragraph (1) of subsection (a)
Line 12 – Enter the amount of NOLs shared with other tax- of Internal Revenue Code (26 U.S.C. s.108).
able members in the current year. This amount cannot exceed
the amount on line 11. Taxable members can only share the Line 21 – Enter the total post allocation net operating loss
combined group post allocation net operating losses with other carryover. Add lines 1b through 20b. This is the amount that is
taxable members that were part of the same combined group carried to Form 500U, Section B, line 1.
in the period in which the loss was generated. Provide a rider
that breaks out the amount of shared NOL by each taxable
member.
Additional Forms and Instructions
Most of the forms and schedules needed to complete the re-
Line 13 – Enter the amount of NOLs received from other tax-
turn are included with Form CBT-100U. However, there are
able members in the current year. This amount cannot exceed
several stand alone forms and schedules that can be obtained
the amount on line 9 less line 10. Taxable members can only
on the Division’s website. This includes:
receive the combined group post allocation net operating
losses from other taxable members that were part of the same • Schedule A-7: Gross Income Test for Financial Businesses
combined group in the period in which the loss was generated. (Form CBT-100U Filers ONLY)
Provide a rider that breaks out the amount of received NOL by
each taxable member. • Schedule G-2: Claim for Exceptions to Disallowed Interest
and Intangible Expenses and Costs
• Schedule I: Certificate of Inactivity (Form CBT-100U Filers
ONLY
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• Schedule N: Nexus – Immune Activity Declaration and the
Nexus Questionnaire
• Schedule O: Nonoperational Activity
• Schedule PT: Dividend Exclusion for Certain Previously
Taxed Dividends
• Schedule X: Member’s Taxable Income From Sources Other
Than the Unitary Business of the Combined Group (Form
CBT-100U Filers ONLY)
• Form 300: Urban Enterprise Zone Employees Tax Credit
• Form 301: Urban Enterprise Zone Investment Tax Credit
• Form 302: Redevelopment Authority Project Tax Credit
• Form 304: New Jobs Investment Tax Credit
• Form 305: Manufacturing Equipment and Employment In-
vestment Tax Credit
• Form 306: Research and Development Tax Credit
• Form 311: Neighborhood Revitalization State Tax Credit
• Form 312: Effluent Equipment Tax Credit
• Form 313: Economic Recovery Tax Credit
• Form 315: AMA Tax Credit
• Form 316: Business Retention and Relocation Tax Credit
• Form 317: Sheltered Workshop Tax Credit
• Form 318: Film Production Tax Credit
• Form 319: Urban Transit Hub Tax Credit
• Form 320: Grow New Jersey Tax Credit
• Form 321: Angel Investor Tax Credit
• Form 322: Wind Energy Facility Tax Credit
• Form 323: Residential Economic Redevelopment and
Growth Tax Credit
• Form 324: Business Employment Incentive Program Tax
Credit
• Form 325: Public Infrastructure Tax Credit
• Form 327: Film and Digital Media Tax Credit
• Form 328: Tax Credit for Employers of Employees With
Impairments
• Form 329: Pass-Through Business Alternative Income Tax
Credit
• Form 330: Apprenticeship Program Tax Credit
• Form 331: Tax Credit for Employer of Organ/Bone Marrow
Donor
• Form 332: Tiered Subsidiary Dividend Pyramid Tax Credit
• Form 333: Tax Credit for Investing in a Qualified Facility
and Hiring Employees to Manufacture Personal Protective
Equipment
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State of New Jersey
Department of the treasury
Division of taxation
Dear Taxpayer,
The year 2021 has continued to deliver challenges not seen in generations. Through it all, the Division has remained committed to our
mission of administering the State’s tax laws uniformly, equitably, and efficiently.
To that end, we paused the roll out of a standardized return. This has allowed us more time to collaborate both internally and with our
stakeholders on how to best collect the data for the new format. The Division anticipates releasing a standardized return for tax year
2022, which will be used instead of Forms CBT-100, BFC-1, or CBT-100U.
This collaboration has shed some light on some of the areas of the return that taxpayers find redundant. While the Division intends
to address more of the concerns in the standardized return, this year’s tax return was updated with any changes that could be
incorporated without too much manipulation. This includes removing Schedules B, C, and C-1. The Division will be using the Federal
data in lieu of collecting the same information on our State-specific schedules. In addition, Schedule A-GR has been removed. The
same information appears on Schedule J. So all filers, regardless of whether they’re nonallocating or only subject to the minimum tax,
will need to complete Schedule J for 2021.
Many of the Executive Orders affecting Corporation Business Tax (CBT) that were signed in response to the pandemic are expiring.
One EO that I want to make sure you are aware expired on October 1, 2021, is the waiver period for CBT nexus for teleworking
employees. New Jersey had temporarily waived the CBT nexus standard, which is generally met if an out-of-State corporation has an
employee working in New Jersey. As long as an out-of-State corporation did not meet any of the factors giving rise to nexus other than
employees working from home in New Jersey solely due to the pandemic, New Jersey did not consider the out-of-State corporation to
have nexus for CBT purposes during the waiver time period.
I think it’s also important to remind you that expenses paid for with Paycheck Protection Program (PPP) Loans are deductible and
forgiven loans are excluded from CBT. See Loan and Grant Information for more information.
As you file this year’s return, look for the “New for 2021” graphic throughout the instructions, which highlights this year’s tax changes.
Lastly, I want to make sure that all taxpayers are aware of the New Jersey Economic Recovery Act of 2020. This legislation created or
revised certain economic programs in the State. I encourage taxpayers to review the Act and see if they’re eligible for any of the various
incentives.
As we continue through this unprecedented time, I can assure you that the Division will continue to do its best to be responsive to
the needs of our taxpayers. We are all on this journey together as we navigate through this global pandemic. We hope that all your
employees, colleagues, and families remain safe and healthy during this time.
Sincerely,
John Ficara
Acting Director
Division of Taxation
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