SENATE, No. 2024

STATE OF NEW JERSEY

INTRODUCED APRIL 21, 1997

By Senator CAFIERO

An Act concerning the declaration and payment of estimated gross income tax by farmers and fishermen, amending N.J.S.54A:8-4, N.J.S.54A:8-5 and N.J.S.54A:9-6.

    Be It Enacted by the Senate and General Assembly of the State of New Jersey:

    1. N.J.S.54A:8-4 is amended to read as follows:

    54A:8-4. Declarations of estimated tax.

    (a) Requirement of filing. Every resident and nonresident individual shall make a declaration of his estimated New Jersey personal income tax for each taxable year beginning after June 30, 1976, if his estimated New Jersey personal income tax can reasonably be expected to be more than $100.00 in excess of any credits allowable against his tax, whether or not he is required to file a Federal declaration of estimated tax for such year.

    (b) Definition of estimated tax. The term "estimated tax" means the amount which an individual estimates to be his income tax under this act for the taxable year, less the amount which he estimates to be the sum of any credits allowable against the tax.

    (c) Joint declaration of husband and wife. A husband and wife may make a joint declaration of estimated tax as if they were one taxpayer, in which case the liability with respect to the estimated tax shall be joint and several. No joint declaration may be made if husband and wife are separated under a decree of divorce or of separate maintenance, or if they have different taxable years. If a joint declaration is made but husband and wife elect to determine their taxes under this act separately, the estimated tax for such year may be treated as the estimated tax of either husband or wife, or may be divided between them, as they may elect.

    (d) Time for filing declaration. Beginning in the taxable year 1976 and every taxable year thereafter a declaration of estimated tax of an individual other than a farmer or fisherman shall be filed on or before April 15 of the taxable year, except that if the requirements of subsection (a) are first met:

    (1) After April 1 and before June 2 of the taxable year, the declaration shall be filed on or before June 15; or

    (2) After June 1 and before September 2 of the taxable year the declaration shall be filed on or before September 15; or

    (3) After September 1 of the taxable year, the declaration shall be filed on or before January 15 of the succeeding year.

    (e) Declaration of estimated tax by a farmer or fisherman. A declaration of estimated tax of an individual having an estimated New Jersey income from farming (including oyster farming) or fishing for the taxable year which is at least two-thirds of his total estimated New Jersey income for the taxable year may be filed at any time on or before January 15 of the succeeding year, in lieu of the time otherwise prescribed.

    (f) Declaration of estimated tax of $100.00 or less. A declaration of estimated tax of an individual having a total estimated tax for the taxable year of $100.00 or less may be filed at any time on or before January 15 of the succeeding year under regulations of the director.

    (g) Amendments of declaration. An individual may amend a declaration under regulations of the director.

    (h) Return as declaration or amendment. If on or before February 15 of the succeeding taxable year, or March 1 of the succeeding taxable year if an individual is a farmer or fisherman qualified to file under subsection (e) of this section, an individual files his return for the taxable year for which the declaration is required, and pays therewith the full amount of the tax shown to be due on the return:

    (1) Such return shall be considered as his declaration if no declaration was required to be filed during the taxable year, but is otherwise required to be filed on or before January 15;

    (2) Such return shall be considered as the amendment permitted by subsection (g) to be filed on or before January 15 if the tax shown on the return is greater than the estimated tax shown in a declaration previously made.

    (i) Fiscal year. This section shall apply to a taxable year other than a calendar year by the substitution of the months of such fiscal year for the corresponding months specified in this section.

    (j) Short taxable year. An individual having a taxable year of less than 12 months shall make a declaration in accordance with regulations of the director.

    (k) Declaration for individual under a disability. The declaration of estimated tax for an individual who is unable to make a declaration by reason of minority or other disability shall be made and filed by his guardian, committee, fiduciary or other person charged with the care of his person or property (other than a receiver in possession of only a part of his property), or by his duly authorized agent.

    (l) In the taxable year 1976, no declaration shall be required until the lapse of at least one full calendar quarter following enactment of this act.

(cf: N.J.S.54A:8-4)

    2. N.J.S.54A:8-5 is amended to read as follows:

    54A:8-5. Payments of estimated tax.

    (a) General. The estimated tax with respect to which a declaration is required shall be paid as follows:

    (1) If the declaration is filed on or before April 15 of the taxable year the estimated tax shall be paid in four equal installments. The first installment shall be paid at the time of the filing of the declaration, and the second, third and fourth installments shall be paid on the following June 15, September 15, and January 15, respectively.

    (2) If the declaration is filed after April 15 and not after June 15 of the taxable year, the estimated tax shall be paid in three equal installments. The first installment shall be paid at the time of the filing of the declaration, and the second and third installments shall be paid on or before the following September 15 and January 15, respectively.

    (3) If the declaration is filed after June 15 and not after September 15 of the taxable year, and is not required to be filed on or before June 15 of the taxable year, the estimated tax shall be paid in two equal installments. The first installment shall be paid at the time of the filing of the declaration, and the second shall be paid on or before the following January 15.

    (4) If the declaration is filed after September 15 of the taxable year, and is not required to be filed on or before September 15 of the taxable year, the estimated tax shall be paid in full at the time of the filing of the declaration.

    (5) If the declaration is filed after the time prescribed therefor, or after the expiration of any extension of time therefor, paragraphs (2), (3), and (4) of this subsection shall not apply, and there shall be paid at the time of such filing all installments of estimated tax payable at or before such time, and the remaining installments shall be paid at the times at which, and in the amounts in which, they would have been payable if the declaration had been filed when due.

    (b) Farmers or Fishermen. If an individual referred to in subsection (e) of N.J.S.54A:8-4 (relating to income from farming or fishing) makes a declaration of estimated tax after September 15 of the taxable year and on or before the following January 15, the estimated tax shall be paid in full at the time of the filing of the declaration. If an individual files a return for the taxable year which is considered a declaration pursuant to subsection (h) of N.J.S.54A:8-4 and pays the full amount of the tax shown to be due on the return, the payment made with that return shall be considered payment in full of the estimated tax.

    (c) Amendments of declaration. If any amendment of a declaration is filed, the remaining installments, if any, shall be ratably increased or decreased (as the case may be) to reflect any increase or decrease in the estimated tax by reason of such amendment, and if any amendment is made after September 15 of the taxable year, any increase in the estimated tax by reason thereof shall be paid at the time of making such amendment.

    (d) Application to short taxable year. This section shall apply to a taxable year of less than 12 months in accordance with regulations of the director.

    (e) Fiscal year. This section shall apply to a taxable year other than a calendar year by the substitution of the months of such fiscal year for the corresponding months specified in this section.

    (f) Installments paid in advance. An individual may elect to pay any installment of his estimated tax prior to the date prescribed for its payment.

(cf: N.J.S.54A:8-5)

    3. N.J.S.54A:9-6 is amended to read as follows:

    54A:9-6. Additions to tax and civil penalties.

    (a) Failure to file tax return. In case of failure to file a tax return under this act on or before the prescribed date (determined with regard to any extension of time for filing), unless it is shown that such failure is due to reasonable cause and not due to willful neglect, there shall be added to the amount required to be shown as tax on such return such amount as is required under the State Tax Uniform Procedure Law, R.S.54:48-1 et seq. For this purpose, the amount of tax required to be shown on the return shall be reduced by the amount of any part of the tax which is paid on or before the date prescribed for payment of the tax and by the amount of any credit against the tax which may be claimed upon the return.

    (b) Deficiency due to negligence. If any part of a deficiency is due to negligence or intentional disregard of this act or rules or regulations hereunder (but without intent to defraud), there shall be added to the tax an amount equal to 10% of the deficiency.

    (c) Failure to file declaration or underpayment of estimated tax. If any taxpayer fails to file a declaration of estimated tax or fails to pay all or any part of an installment of estimated tax, he shall be deemed to have made an underpayment of estimated tax. There shall be added to the tax for the taxable year an amount at the rate as is required under the State Tax Uniform Procedure Law, R.S.54:48-1 et seq., upon the amount of the underpayment for the period of the underpayment but not beyond the 15th day of the fourth month following the close of the taxable year. The amount of underpayment shall be the excess of the amount of the installment which would be required to be paid if the estimated tax were equal to 80% of the tax (two-thirds of the tax for farmers or fishermen referred to in subsection (e) of section 54A:8-4) shown on the return for the taxable year (or if no return was filed, of the tax for such year) over the amount, if any, of the installment paid on or before the last day prescribed for such payment. No underpayment shall be deemed to exist with respect to a declaration or installment otherwise due on or after the taxpayer's death.

    (d) Exception to addition for underpayment of estimated tax. The addition to tax under subsection (c) with respect to any underpayment of any installment shall not be imposed if the total amount of all payments of estimated tax made on or before the last date prescribed for the payment of such installment equals or exceeds whichever of the following is the lesser--

    (1) The amount which would have been required to be paid on or before such date if the estimated tax were whichever of the following is the least--

     (A) The tax shown on the return of the individual for the preceding taxable year, if a return showing a liability for tax was filed by the individual for the preceding taxable year and such preceding year was a taxable year of 12 months, or

     (B) An amount equal to the tax computed, at the rates applicable to the taxable year, on the basis of the taxpayer's status with respect to his personal exemptions for the taxable year, but otherwise on the basis of the facts shown on his return for, and the law applicable to, the preceding taxable year, or

     (C) An amount equal to 80% of the tax for the taxable year (two-thirds of the tax for farmers or fishermen referred to in subsection (e) of section 54A:8-4) computed by placing on an annualized basis the income for the months in the taxable year ending before the month in which the installment is required to be paid. For purposes of this subparagraph, the income shall be placed on an annualized basis by--

      (i) Multiplying by 12 (or, in the case of a taxable year of less than 12 months, the number of months in the taxable year) the income for the months in the taxable year ending before the month in which the installment is required to be paid,

      (ii) Dividing the resulting amount by the number of months in the taxable year ending before the month in which such installment date falls, and

      (iii) Deducting from such amount the deductions for personal exemptions allowable for the taxable year (such personal exemptions being determined as of the last date prescribed for payment of the installment); or

    (2) An amount equal to 90% of the tax computed, at the rates applicable to the taxable year, on the basis of the actual income for the months in the taxable year ending before the month in which the installment is required to be paid.

    (e) Deficiency due to fraud. If any part of a deficiency is due to fraud, there shall be added to the tax an amount equal to 50% of the deficiency. This amount shall be in lieu of any other addition to tax imposed by subsection (a) or (b).

    (f) Nonwillful failure to pay withholding tax. If any employer, without intent to evade or defeat any tax imposed by this act or the payment thereof, shall fail to make a return and pay a tax withheld by him at the time required by or under the provisions of section 54A:7-4, such employer shall be liable for such tax and shall pay the same together with interest thereon and the addition to tax provided in subsection (a), and such interest and addition to tax shall not be charged to or collected from the employee by the employer. The director shall have the same rights and powers for the collection of such tax, interest and addition to tax against such employer as are now prescribed by this act for the collection of tax against an individual taxpayer.

    (g) Willful failure to collect and pay over tax. Any person required to collect, truthfully account for, and pay over the tax imposed by this act who willfully fails to collect such tax or truthfully account for and pay over such tax or willfully attempts in any manner to evade or defeat the tax or the payment thereof, shall, in addition to other penalties provided by law, be liable to a penalty equal to the total amount of the tax evaded, or not collected, or not accounted for and paid over. No addition to tax under subsection (b) or (c) shall be imposed for any offense to which this subsection applies.

    (h) Failure to file certain information returns. In case of each failure to file a statement of a payment to another person, required under authority of subsection (c) of section 54A:8-6 (relating to information at source, including the duplicate statement of tax withheld on wages) on the date prescribed therefor (determined with regard to any extension of time for filing), unless it is shown that such failure is due to reasonable cause and not to willful neglect, there shall, upon notice and demand by the director and in the same manner as tax, be paid by the person so failing to file the statement, a penalty of $2.00 for each statement not so filed, but the total amount imposed on the delinquent person for all such failures during any calendar year shall not exceed $2,000.00.

    (i) Additional penalty. Any person who with fraudulent intent shall fail to pay, or to deduct or withhold and pay, any tax, or to make, render, sign or certify any return or declaration of estimated tax or to supply any information within the time required by or under this act, shall be liable to penalty of not more than $5,000.00, in addition to any other amounts required under this act, to be imposed, assessed and collected by the director. The director shall have the power, in his discretion, to waive, reduce or compromise any penalty under this subsection.

    (j) Additions treated as tax. The additions to tax and penalties provided by this section shall be paid upon notice and demand and shall be assessed, collected and paid in the same manner as taxes and any reference in this act to income tax or tax imposed by this act, shall be deemed also to refer to the additions to tax and penalties provided by this section. For purposes of section 54A:9-2, this subsection shall not apply to:

    (1) Any addition to tax under subsection (a) except as to that portion attributable to a deficiency;

    (2) Any addition to tax under subsection (e); and

    (3) Any additional penalty under subsection (i).

    (k) Determination of deficiency. For purposes of subsections (b) and (c), the amount shown as the tax by the taxpayer upon his return shall be taken into account in determining the amount of the deficiency only if such return was filed on or before the last day prescribed for the filing of such return, determined with regard to any extension of time for such filing.

    (l) Person defined. For purposes of subsections (f), (g), (h) and (i), the term person or employer includes an individual, corporation or partnership or an officer or employee of any corporation (including a dissolved corporation) or a member or employee of any partnership, who as such officer, employee, or member is under a duty to perform the act in respect of which the violation occurs.

(cf: P.L.1987, c.76, s.59)

    4. This act shall take effect immediately and shall apply to taxable years beginning on and after January 1 next following enactment.

STATEMENT

    This bill permits fishermen to file the declaration of estimated gross income tax and pay the full amount of the estimated tax by January 15 following the taxable year for which the taxes are due. Current law already permits farmers to file the declaration and pay the estimated tax by this date. In general, individuals, other than farmers, are required to file the declaration of estimated tax by April 15 of each taxable year and to pay the tax in quarterly installments during the year.

    In addition, the bill provides that if a farmer or fisherman files a personal income tax return and pays the full amount of the tax due by March 1 of the succeeding taxable year, the filing of the return will be considered the declaration of estimated tax and no penalty will be assessed for not filing a declaration and making a payment by January 15. Current law already contains this special provision for certain taxpayers, including farmers, who file a return and pay the tax by February 15 of the succeeding taxable year.

Modifies schedule for declaration and payment of estimated gross income tax by farmers and fishermen.