New Jersey Administrative Code
Title 18 - TREASURY - TAXATION
Chapter 24 - SALES AND USE TAX ACT
Subchapter 5 - CONTRACTORS AND SERVICES PERFORMED ON REAL PROPERTY
Section 18:24-5.19 - Unregistered contractor bonds or reports

(a) When a contractor who has not registered under provisions of 54:32B-15 enters into a contract under which tangible personal property or taxable services will be used or consumed in New Jersey, the contractor shall register for tax purposes and present to the Director of the Division of Taxation a deposit or guarantee bond equal to five percent of the total amount to be paid under the contract whenever the circumstances indicate that it is appropriate to protect the interests of the State. Such circumstances would include a situation in which an unregistered contractor is only temporarily engaged in business in the State.

(b) Any person doing business with a contractor shall obtain from the contractor a copy of the tax registration certificate issued to the contractor pursuant to 54:32B-15. If the contractor does not have a tax registration certificate, the person doing business with the contractor shall provide the name and address of the contractor and a brief description of the contract to the Division. This requirement shall be satisfied by mailing the name and address and contract summary to the New Jersey Division of Taxation, PO Box 269, Trenton, NJ 08695. Failure to comply shall be a disorderly persons offense under 54:52-6.

(c) The bond requirement is imposed to secure payment of sales and use taxes payable with respect to tangible personal property or taxable services used or consumed under a contract, or of other State taxes, and is also imposed to assure that all contractors are registered and in compliance with New Jersey tax law.