Income Tax
NJCPA Applauds Signing of Pass-Through Business Alternative Income Tax Act
The act allows flow-through businesses in New Jersey, such as sub-S corporations, partnerships, LLCs or sole proprietorships, to elect to pay income taxes at the entity level instead of at the personal income tax level — helping to alleviate the tax ...
Jan. 13, 2020
The New Jersey Society of Certified Public Accountants (NJCPA) welcomes governor Murphy’s signing of the Pass-Through Business Alternative Income Tax Act (A-4807/S-3246) on Jan. 13, 2020. The act, which passed the New Jersey legislature on Dec. 16, 2019, allows flow-through businesses in New Jersey, such as sub-S corporations, partnerships, LLCs or sole proprietorships, to elect to pay income taxes at the entity level instead of at the personal income tax level — helping to alleviate the tax pressure put on small business owners from the Tax Cuts and Jobs Act’s (TCJA) state and local tax deduction cap.
The society said that it is grateful to the governor, the legislature and all those who supported the bill and for their dedication to assisting small businesses in New Jersey.
The society further commended state senate president Stephen Sweeney, assembly speaker Craig Coughlin and the primary sponsors of the Act, including state senators Paul Sarlo (D-36), Troy Singleton (D-7), Steven Oroho (R-24) and Anthony Bucco (R-25), along with assembly members Daniel Benson (D-14) and Roy Freiman (D-16).
NJCPA president-elect Alan D. Sobel, CPA, CGMA, managing member at Livingston-based SobelCo, originated the concept of the pass-through entity legislation and helped write the act, which is estimated to save New Jersey business owners $200 to $400 million annually on their federal tax bills.
The NJCPA continues to support legislation that promotes a business-friendly environment in New Jersey.