Nexus for Corporation Business Tax for Privilege Periods Ending Before July 31, 2023 

                                                     TB-79(R) - Revised September 5, 2023 
                                                              Tax: Corporation Business Tax 

Revision Information: This Technical Bulletin was revised on September 5, 2023, to include 
links to TB-108 for information on the updated nexus standards established under P.L. 2023, c. 
96, as well as the updated P.L. 86-272 guidelines established by the Multistate Tax Commission 
as adopted by the Division that went onto effect for privilege periods ending on and after July 
31, 2023.  

This Technical Bulletin provides general guidelines for determining whether the activities of a 
corporation create nexus with New Jersey for the purposes of imposing the Corporation 
Business Tax for privilege periods ending before July 31, 2023. 

For privilege periods ending on and after July 31, 2023, see TB-108 for information on nexus and 
P.L. 86-272 standards for New Jersey purposes.

Corporation Business Tax Nexus 
The New Jersey Corporation Business Tax Act requires every domestic or nonresident 
corporation to pay an annual franchise tax for the following privileges:  
1. Having or exercising its corporate franchise in this State;
2.  Deriving receipts from sources within this State;
3.  Engaging in contacts within this State;
4.  Doing business, having employees, owning capital or property, or maintaining an office in this
State.

A foreign corporation has a corporate franchise in this State if: 
1. It has registered with the New Jersey Department of Revenue and Enterprise Services; and/or
2. Holds a certificate, license, or other authorization issued by any other State department or
agency authorizing the company to engage in corporate activity in this State.

In determining whether a corporation is doing business in New Jersey, consideration is given to 
such factors as: 
1. The nature and extent of the activities of the corporation in New Jersey;
2. The location of its offices and other places of business;
3. The continuity, frequency, and regularity of the activities of the corporation in New Jersey;
4. The employment in New Jersey of agents, officers, and employees;
5. The location of the actual seat of management or control of the corporation.

Public Law 86-272 
The Federal Interstate Income Act, Title 15 U.S.C.A. Section 381, “Public Law 86-272,” prohibits a 
state from imposing a net income based tax on income of a foreign corporation earned within 

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its borders from interstate commerce, if the corporation’s only business activity within the state 
consists of the solicitation of orders by the corporation or its representatives of tangible 
personal property, the orders are sent outside the state for approval and, if approved, are filled 
by shipment or delivery from a point outside the state.  

Note:  P.L. 86-272 does not apply to services or intangible personal property.  

A foreign corporation that conducts business activity in New Jersey that exceeds the protection 
of Public Law 86-272 is subject to the Corporation Business Tax as measured by the net income 
of the corporation. Even though a corporation’s activities may be protected by Public Law 86- 
272, if it is registered or otherwise has nexus in New Jersey, it is subject to the Corporation 
Business Tax minimum tax and must file a Corporation Business Tax return.  

In-State activities by a corporation that create nexus for Corporation Business Tax 
purposes and that EXCEED the protections of Public Law 86-272 include, but are not limited 
to:  
1.  Repairs, maintenance, and installations;  
2.  Collection or repossession activities;  
3.   Credit investigations;  
4.   Conducting training courses, seminars, or lectures for personnel (other than for personnel 
involved only in solicitation);  
5.   Providing technical assistance;  
6.   Resolving customer complaints for a purpose other than to ingratiate sales personnel with 
the customer;  
7.   Approving or accepting orders or securing deposits on sales;  
8.   Acquiring personnel for purposes other than solicitation activities;  
9.   Maintaining a display at a single location within New Jersey in excess of two weeks during 
the tax year;  
10.  Carrying samples for sale, exchange, or distribution in any manner for consideration or other 
value;  
11.  Picking up or replacing damaged or returned property;  
12.  Owning, leasing, or maintaining in-State facilities such as a warehouse or telephone 
answering service;  
13.  Consigning tangible personal property. 

More Information 
General information about Corporation Business Tax and Changes to the Corporation Business 
Tax Act is available online. 

For privilege periods ending on and after July 31, 2023, see TB-108 for information on nexus and 
P.L. 86-272 standards for New Jersey purposes.   

See N.J.A.C. 18:7-1.6 through 1.25 for the nexus regulations.  

Note: A Technical Bulletin is an informational document that provides guidance on a topic of interest to 
taxpayers and may describe recent changes to the relevant laws, regulations, and/or Division policies. It is 

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accurate as of the date issued. However, taxpayers should be aware that subsequent changes to the 
applicable laws, regulations, and/or the Division’s interpretation thereof may affect the accuracy of a 
Technical Bulletin. The information provided in this document does not cover every situation and is not 
intended to replace the law or change its meaning. 

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