Compliance with New Jersey Regulations for Out-of-State Wholesalers
[The following information was compiled by Riverbend Nursery for use by their shipping department and is not to be taken as absolute legal advise, use at your own discretion.]
Delivering to New Jersey Customers Background:
New Jersey imposes a Corporation Business Tax (CBT) for the privilege of having a corporate charter, doing business and employing capital in the state. Employing capital in the state is broadly defined to include a company-owned truck delivering into the state.
Steps to establish authority to do business in New Jersey:
1. Complete the "Public Records Filing for New Business Entity" form which serves as the original certificate of incorporation / authority.
a. Business name must be a unique name in the New Jersey records. Contact 609-292-9292 for fee-based service to determine if company name is available. If the current legal name is not available, the following is required:
1. Obtain a Corporate Resolution from Board of Directors authorizing the company to do business in New Jersey under the d/b/a name.
b. Obtain a current "Certificate of Good Standing" from the Virginia State Corporation Commission indicating company is currently in good standing in home state. Fee is $6.00.
c. File the completed "Public Records Filing for New Business Entity" form along with the Certificate of Good Standing and Corporate Resolution. Fee is $150.00 for company with DBA name.
This step should result in the issuance of a Corporate Charter to do business in New Jersey.
2. Complete the NJ-REG Form for Business Registration. No fee is required with this report. Check Section 11 "Will you collect New Jersey Sales Tax...." as 'No' if you will only sell wholesale into the state. This election will allow "Non-Reporting Basis" for sales tax purposes.
3. Obtain an ST-3 Exemption Certificate from all customers to verify sales tax exempt status. A copy of the Customer's ST-3 should be provided to the driver when delivering by company truck.
4. On an annual basis, the company must file a CBT-100-R due the 15th day of the Fourth Month following year-end. An automatic six-month extension is available using CBT-200. The CBT-100-R is the New Jersey Corporation Business Tax Return and requires copies of the Federal Income Tax return for completion. Estimated completion time of 8 hours.
Failure to file the CBT-100-R can result in the seizure of company assets and the levying of a Warrant of Jeopardy Assessment. For example, a company truck may be seized at a NJ weigh station and held until any back taxes and penalties are wired to the state. The minimum annual fee under CBT-100 is $500 regardless of the amount of income attributable to New Jersey.
New York
New York has similar regulations defining "doing business" as "doing business in a corporate form, employing capital, owning or leasing property or maintaining an office in New York State". "The term doing business is used in a comprehensive sense and includes all activities which occupy the time or labor of men for profit." NY Courts have ruled that non-New York employees of a company operating in the state subject the company to Business Corporation Franchise Tax.
- provided by Riverbend Nursery, jim@riverbendnursery.com ; 540-763-2022
