New Jersey Announces Tax Compliance Initiative for Media Companies


On August 10, 2011, New Jersey announced a new corporate tax compliance initiative for media companies. Companies that come forward voluntarily can pay reduced tax and avoid significant penalties. But companies have only until November 15 to take advantage of this program.

New Jersey is one of the most aggressive states in terms of asserting tax jurisdiction over out-of-state businesses. The state taxing authority, the New Jersey Division of Taxation (or "Division"), has previously targeted intangible licensing companies, franchisors, software companies, and the financial services industry. Now it has turned its attention to media companies, including media content companies. Under the Division's audit policy, a media company that receives advertising, subscription, or syndication revenues from New Jersey-based clients or customers is subject to New Jersey corporate income tax. Under this so-called "economic nexus" standard, a media company is subject to New Jersey tax regardless of physical presence. That is, the Division requires a media company to file returns and pay tax to New Jersey even if it has no employees and conducts no activities in the state.

Please see full alert below for more information.

LOADING PDF: If there are any problems, click here to download the file.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Reed Smith | Attorney Advertising

Written by:


Reed Smith on:

Readers' Choice 2017
Reporters on Deadline

"My best business intelligence, in one easy email…"

Your first step to building a free, personalized, morning email brief covering pertinent authors and topics on JD Supra:

Sign up to create your digest using LinkedIn*

*By using the service, you signify your acceptance of JD Supra's Privacy Policy.

Already signed up? Log in here

*With LinkedIn, you don't need to create a separate login to manage your free JD Supra account, and we can make suggestions based on your needs and interests. We will not post anything on LinkedIn in your name. Or, sign up using your email address.