New Jersey Administrative Code
Title 18 - TREASURY - TAXATION
Chapter 7 - CORPORATION BUSINESS TAX ACT
Subchapter 7 - ALLOCATION
Section 18:7-7.5 - Allocation factor; application

(a) If the taxpayer had a regular place of business outside New Jersey during the period covered by the return, its tax liability under the New Jersey Corporation Business Tax Act is measured by that part of its entire net income allocated to New Jersey according to a formula called the business allocation factor.

(b) If the taxpayer is deemed to be a "part year allocating" taxpayer because it had a regular place of business outside New Jersey for less than 50 percent of the period of time covered by the return, it will determine its overall business allocation factor by prorating the overall business allocation factor computed by the number of months, or part thereof, that a regular place of business was maintained and adding this to 100 percent prorated by the number of months, or part thereof, a regular place of business was not maintained.

Example: Corporation X establishes its only regular place of business outside New Jersey on November 16 of its 12 month calendar year. The overall business allocation factor computed on Schedule J for the entire period was 62.2424 percent. The prorated allocation factor would be 93.7071 percent computed as follows:

62. 2424 x 2) + (100 x 10)

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